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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

(Mark One)

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

         For the fiscal year ended December 31, 2000 or

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

         For the transition period from __________ to __________

         Commission file number 0-17171

                             URANIUM RESOURCES, INC.
                 (Name of Small Business Issuer in its Charter)

                  DELAWARE                               75-2212772
          (State of Incorporation)          (I.R.S. Employer Identification No.)

650 S. EDMONDS LANE, SUITE 108 LEWISVILLE, TEXAS           75067
   (Address of principal executive offices)              (Zip code)

                                 (972) 219-3330
                (Issuer's telephone number, including area code)

        SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                                                   NAME OF EACH EXCHANGE
        TITLE OF EACH CLASS                         ON WHICH REGISTERED
Common Stock, $.001 par value per share                    None

Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the issuer was required to file such
reports) and (2) has been subject to such filing requirements for the past 90
days. Yes     No  X
          ---    ---

Check if there is disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

The Issuers revenues for the year ended December 31, 2000 was $ 1,081,895.

The aggregate market value of the Common Stock of the Issuer held by
non-affiliates at April 12, 2001 was approximately $ 4,176,454.

Number of shares of Common Stock outstanding as of April 12, 2001: 48,992,278
shares.

                      Documents Incorporated by Reference:

                                      None


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                             URANIUM RESOURCES, INC.
                          ANNUAL REPORT ON FORM 10-KSB
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000

                                TABLE OF CONTENTS

                                                                                                              
PART I............................................................................................................1

   ITEM 1. DESCRIPTION OF BUSINESS................................................................................1
     Going Concern/Uncertain Future Operations....................................................................1
     The Company..................................................................................................2
        Marketing Strategy/Uranium Sales Contracts................................................................3
        Resources.................................................................................................3
        The ISL Mining Process....................................................................................3
        Environmental Considerations and Permitting; Water Rights.................................................5
     The Uranium Industry.........................................................................................7
        General...................................................................................................7
        Market Price Formation....................................................................................8
        Sources of Supply.........................................................................................8
        Required Primary Production...............................................................................9
        Uranium Prices............................................................................................9
        Competition..............................................................................................10

   ITEM 2. DESCRIPTION OF PROPERTY...............................................................................10
        South Texas Producing Properties.........................................................................10
        South Texas Development Properties.......................................................................11
        New Mexico Development Properties........................................................................12
        Santa Fe Properties......................................................................................15
        Reclaimed Properties.....................................................................................16
        Reclamation and Restoration Costs and Bonding Requirements...............................................16

   ITEM 3. LEGAL PROCEEDINGS.....................................................................................17
        Benton Bankruptcy........................................................................................17
        Other....................................................................................................17
        Indian Lands Jurisdictional Dispute......................................................................17

   ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...................................................17

PART II..........................................................................................................25

   ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS..............................................25
        Market Information.......................................................................................25
        Recent Sales of Unregistered Securities..................................................................25
        Holders..................................................................................................26
        Dividends................................................................................................26

   ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.............................................27

   ITEM 7. FINANCIAL STATEMENTS..................................................................................27

   ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE..................27

PART III.........................................................................................................28

   ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;COMPLIANCE WITH SECTION 16(a) OF THE
           EXCHANGE ACT..........................................................................................28

   ITEM 10. EXECUTIVE COMPENSATION...............................................................................31

   ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.......................................36

   ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.......................................................38

PART IV..........................................................................................................39

   ITEM 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K......................................39


         SIGNATURES..............................................................................................40





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                             URANIUM RESOURCES, INC.

                          ANNUAL REPORT ON FORM 10-KSB
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000

                                     PART I

         The "Company" or "Registrant" is used in this report to refer to
Uranium Resources, Inc. and its consolidated subsidiaries. Items 1 and 2 contain
"forward-looking statements" and are made pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995. These
statements include, without limitation, statements relating to management's
expectations regarding the Company's resource base, timing of receipt of mining
permits, production capacity of mining operations planned for properties in
South Texas and New Mexico and planned dates for commencement of production at
such properties, business strategies and other plans and objectives of the
Company's management for future operations and activities and other such
matters. The words "believes," "plans," "intends," "strategy," "projects,"
"targets," or "anticipates" and similar expressions identify forward-looking
statements. The Company does not undertake to update, revise or correct any of
the forward-looking information. Readers are cautioned that such forward-looking
statements should be read in conjunction with the Company's disclosures under
the heading: "Cautionary Statement for the Purposes of the `Safe Harbor'
Provisions of the Private Securities Litigation Reform Act of 1995" beginning on
page 19.

         Certain terms used in this Form 10-KSB are defined in the "Glossary of
Certain Terms" appearing at the end of Part I hereto.

ITEM 1. DESCRIPTION OF BUSINESS

GOING CONCERN/UNCERTAIN FUTURE OPERATIONS

         Because uranium prices were depressed to a level below the cost of
production, the Company ceased production activities in 1999 at both of its two
producing properties. In 1999 and the first quarter of 2000 the Company
monetized all of its remaining long-term uranium sales contracts and sold
certain of its property and equipment to maintain a positive cash position. The
market price of uranium continues to be below the Company's cost to produce
uranium and the price needed to obtain the necessary financing to allow
development of new production areas at the Company's South Texas sites.

         During 2000, the Company sought to raise funds to permit it to continue
operations until such time uranium prices increase to a level that will permit
the Company to resume mining operations. In August 2000 and April 2001 the
Company completed two private placements raising an aggregate of $2,835,000
through the issuance of 33,562,500 shares of common stock and warrants expiring
in August 2005 to purchase an additional 5,625,000 shares of Common Stock. As
adjusted for the April offering, the exercise price of the warrants is $0.14
per share. The funds raised in the private placements are to be used to fund the
non-restoration overhead costs of the Company.

         In addition, in October 2000 the Company finalized an agreement with
Texas regulatory authorities and the Company's bonding company, that provided
the Company access to up to $2.2 million in additional funding. Approximately
$1,527,000 has been released to the Company through March 31, 2001 to perform
restoration at the Company's Kingsville Dome and Rosita mine sites in South
Texas. The term of the restoration agreement runs through the end of 2001.

         The Company has engaged the independent audit firm of Hein + Associates
LLP to perform the audit of its financial statements for the years ended
December 31, 1999 and 2000. Such audit is currently



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being undertaken and is expected to be completed by the April 30, 2001. Funds
from the private placement will be used to pay for such an audit.

         The shares issued in the private placements represent approximately 69%
of the outstanding Common Stock of the Company. The completion of the private
placement resulted in a significant dilution of the current stockholders' equity
in the Company.

         Assuming that the Company is able to continue funding its restoration
of the Kingsville Dome and Rosita mine sites through extensions to its agreement
with Texas regulatory authorities and the Company's bonding company, the Company
estimates it will have the funds to remain operating into approximately the
first quarter of 2003. Additional funds will be required for the Company to
continue operating after that date. The Company's current agreement with the
Texas regulatory authorities and its bonding company extends through 2001. The
Company cannot guarantee that it will be able to extend such agreement beyond
2001, or that any extension of the agreement that is negotiated will contain the
same terms and conditions as the current agreement.

         The Company would require additional capital resources to fund the
development of its undeveloped properties. There is no assurance the Company
will be successful in raising such capital or that uranium prices will recover
to levels which would enable the Company to operate profitably.

         The Company's financial statements for the year ended December 31, 1999
and 2000 are not included in this Annual Report on Form 10-KSB. The Company will
file an amended Annual Report on Form 10-KSB/A upon completion of the audit.


THE COMPANY

         The Company was formed in 1977 to acquire, explore and develop
properties for the mining of uranium in the United States using the in situ
leach ("ISL") mining process. The Company is recognized as a leader in the field
of ISL mining.

         In the ISL process, groundwater fortified with oxidizing agents is
pumped into the ore body causing the uranium contained in the ore to dissolve.
The resulting solution is pumped to the surface where it is further processed to
a dried form of uranium, which is shipped to conversion facilities for sale to
the Company's customers. The ISL process is generally a more cost effective and
environmentally benign mining method than conventional mining techniques.

         In March 1988, the Company commenced production from its Kingsville
Dome property in South Texas and produced a total of approximately 1.5 million
pounds of uranium from that property prior to September 1990 when it was shut-in
because of low uranium prices. Production was reestablished in March 1996 and an
additional 2.0 million pounds of uranium were produced through 1999. In the
first quarter of 1999 the Company placed production at Kingsville Dome on
stand-by but continued to maintain nominal production through July 1999. Total
production for 1999 was 61,000 pounds. Additional uranium resources exist at
Kingsville Dome, but additional capital investment will be required in order to
begin development of these resources.

         In October 1990, the Company commenced production from its Rosita
property in South Texas and produced a total of approximately 1.1 million pounds
of uranium from that property prior to March 1992 when it was shut-in because of
low uranium prices. Production was reestablished in June 1995 and an additional
1.5 million pounds of uranium have been produced through 1999. In the first
quarter of 1999 the Company placed production at Rosita on stand-by but
continued to maintain nominal production through July 1999. Total production for
1999 was 48,000 pounds. The Rosita property is essentially at the end of its
productive capacity, although some minor resources still remain that could be
produced.



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         The weakness of the uranium market saw spot prices that ranged from
$9.60 to $10.85 in 1999 and $7.10 to $9.60 in 2000. The continued weak market
for uranium prices during 1999 and 2000, which primarily resulted from the
actions of aggressive sellers, including the disposition of former U.S.
Government stockpiles have continued to depress uranium prices. The current spot
market price of $8.25 remains below the level needed by the Company to obtain
the necessary financing to allow development of new production areas at its
Kingsville Dome and Vasquez sites.

         The Company continues to hold its Vasquez development project in South
Texas and has three development projects in two districts in New Mexico, the
Churchrock district and the Crownpoint district. Commencement of production at
these properties will be dependent on a rebound in uranium prices to profitable
levels, the availability of sales contracts and the availability of capital.

         As of April 10, 2001, the Company had 18 employees, including its
professional staff consisting of 1 geologist, four engineers and two certified
public accountants. To support its operations the Company maintains field
offices at the Kingsville Dome site, the Rosita site and in Crownpoint, New
Mexico.


MARKETING STRATEGY/URANIUM SALES CONTRACTS

         Long-term contracts have historically been the primary source of
revenue to the Company. At the beginning of 1999 the Company had four long-term
contracts for deliveries over the next two, three and four years of
approximately $26.9 million in revenues. During 1999, the Company assigned its
delivery rights for 2000 through 2002 under one of these contracts for
$1,290,000 and also accelerated the scheduled deliveries under another contract
into the fourth quarter of 1999, effectively bringing forward $1,069,000 of cash
originally scheduled for the fourth quarter of 2000. These transactions coupled
with transactions made in the first quarter of 2000 monetized the Company's
long-term sales contracts and exhausted the Company's sales contract portfolio.
Currently, the Company does not have any remaining scheduled uranium deliveries
under contract for 2001 or beyond.

         In 2000 and 1999, the Company had sales to one and four customers,
respectively, that amounted to more than 10% of total sales. These customers
represented 100% of sales in 2000 and 31%, 29%, 25% and 15% of sales in 1999.


RESOURCES

         The Company has previously reported the proven and probable reserve
base for each of its producing and development projects in Texas and New Mexico
assuming that each of these projects would be placed into production at a future
date. In December 1999 the Company wrote down the carrying value of its uranium
properties. As a result of this writedown the Company has reclassified its
significant uranium holdings from reserves to resources consistent with the
Securities and Exchange Commission definitions. See "Glossary".

THE ISL MINING PROCESS

         The ISL mining process, a form of solution mining, differs dramatically
from conventional mining techniques. The ISL technique avoids the movement and
milling of significant quantities of rock and ore as well as mill tailings waste
associated with more traditional mining methods and generally results in a more
cost-effective and more environmentally benign extraction operation in
comparison to conventional uranium mining. Historically, the majority of U.S.
uranium production resulted from either open pit surface mines or underground
shaft operations. These conventional mining methods are, in many cases,



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capital and labor intensive and are not cost competitive with the majority of
non-U.S. conventional producers.

         The ISL process was first tested for the production of uranium in the
mid-1960's and was first applied to a commercial-scale project in 1975 in South
Texas. The ISL process had become well established in the South Texas uranium
district by the late 1970's, where it was employed in connection with
approximately twenty commercial projects, including two operated by the Company.

         In the ISL process, groundwater fortified with oxygen and other
solubilizing agents is pumped into a permeable ore body causing the uranium
contained in the ore to dissolve. The resulting solution is pumped to the
surface where the uranium is removed from the solution and processed to a dried
form of uranium, which is shipped to conversion facilities for sale to the
Company's customers.

         An ISL project involves several major components:

         ORE BODY EVALUATION

         Ore bodies which are currently being mined by the ISL process are
associated with groundwater saturated permeable sandstone formations typically
located between 100 and 2,000 feet below the surface. The uranium ore is
deposited in a roll front configuration where the groundwater passing through
the sandstone passes from a natural oxidizing environment to a naturally
occurring reducing environment. This change causes the dissolved uranium in the
groundwater to become insoluble and it then attaches to the grains of the
sandstone. Some important factors in evaluating an ore body for the ISL process
are permeability, the thickness of the ore zone, depth, size, grade of ore,
shape of the ore body, nature of uranium mineralization, host rock mineralogy,
and the hydrology. These factors are important in determining the design of the
wellfield, the type and flow of the leaching solution, and the nature of the
surface ISL facilities.

         WELLFIELD DESIGN

         The wellfield is the mechanism by which the leaching solution, or
lixiviant, is circulated through the ore body. The wellfield consists of a
series of injection, production (extraction) and monitoring wells drilled in
specified patterns. These patterns will vary primarily with the configuration of
the ore and the hydrologic characteristics of each deposit. Determining the
wellfield pattern is crucial to minimizing costs and maximizing efficiencies of
production. Injection and production wells vary in diameter from four to six
inches. Generally, these wells are drilled down to the bottom of the ore zone
(through which the lixiviant must be circulated to achieve production).
Injection and production wells are cased with polyvinyl chloride ("PVC") or
fiberglass casings, which are cemented in place from the bottom of the ore zone
to the surface. The wells are then completed into the ore zone.

         LIXIVIANT CHEMISTRY

         The lixiviant, consisting of native groundwater fortified with an
oxidant and an anionic complexing agent, is introduced via the injection wells
to the ore bearing aquifer. The oxidant (gaseous oxygen) changes the uranium
valence state making the uranium soluble in the lixiviant. The lixiviant (sodium
bicarbonate) complexes the original uranium to a soluble ion, uranyl
dicarbonate, which dissolves the uranium. The dissolved uranium then flows to
the surface with the lixiviant fluid, which is circulated through the ore body
until economic recovery is achieved.

         URANIUM RECOVERY PROCESS

         The uranium recovery process consists of a lixiviant circuit, an
elution/precipitation circuit and a drying and packaging process. The lixiviant
circuit flows from the ore body, where the uranium is dissolved. The lixiviant
stream is then circulated to an ion exchange column on the surface where uranium



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is extracted from the lixiviant by absorption onto the resin beads of the ion
exchange columns. The lixiviant is then refortified and reinjected into the ore
body. When the ion exchange column's resin beads are loaded with uranium, the
loaded uranium is removed and placed into the elution circuit where the uranium
is flushed with a salt-water solution, which precipitates the uranium from the
beads. This leaves the uranium in slurry, which is then dried and packaged for
shipment as uranium powder.

         The Company has historically utilized a central plant for the ion
exchange portion of the production process. In order to increase operating
efficiency and reduce future capital expenditures, the Company began the design
and development of wellfield-specific remote ion exchange methodology. Instead
of piping the solutions over large distances through large diameter pipe lines
and mixing the waters of several wellfields together, each wellfield will be
mined using a dedicated satellite ion exchange facility. This will allow for ion
exchange to take place at the wellfield instead of at the central plant.

         Nominal design for the remote ion exchange facilities flow will be in
the range of 1,200 gpm, about 25% of the design flow of the central plant at the
Kingsville Dome project. Each of these units will consist of several
ion-exchange columns and a resin transfer facility. When fully loaded with
uranium, the resin will be transferred to a trailer and the resin trucked to the
central plant for elution. After stripping the uranium from the resin, the resin
will be transferred into the trailer and transported back to the satellite plant
at the wellfield.

         These satellite facilities will allow each wellfield to be mined using
its own native groundwater only, thus eliminating the problems associated with
progressive buildup of dissolved solids in the groundwater and thereby enhancing
mining efficiencies and uranium recoveries.

         WELLFIELD RESTORATION

         At the conclusion of mining, the mine site is decommissioned and
decontaminated and the wellfield is restored and reclaimed. Wellfield
restoration involves returning the aquifer to a condition consistent with its
pre-mining use and removing evidences of surface disturbance. The restoration of
the wellfield can be accomplished by flushing the ore zone for a time with
native ground water and/or using reverse osmosis to remove ions, minerals and
salts to provide clean water for reinjection to flush the ore zone.
Decommissioning and decontamination of the mine site entails decontamination,
dismantling and removal for disposal or reuse of the structures, equipment and
materials used at the site during the mining and restoration activities.

ENVIRONMENTAL CONSIDERATIONS AND PERMITTING; WATER RIGHTS

         The production of uranium is subject to extensive regulations,
including federal and state (and potentially tribal) environmental regulations,
that have a material effect on the economics of the Company's operations and the
timing of project development. The Company's primary regulatory costs have been
related to obtaining and complying with the regulatory licenses and permits that
must be obtained from federal and state agencies prior to the commencement of
uranium mining activities.

         Environmental considerations include the prevention of groundwater
contamination by escape of leaching solution (through proper design and
operation of the wellfield and the use of monitoring wells to detect any
potential excursions from the mining area) and the treatment and disposal of
liquid and/or solid discrete surface waste or by-product materials (so-called
"11e. (2) by-product material" under federal law). The majority of by-product
material that is generated is liquid and generally is disposed of by a
combination of reverse osmosis, brine concentration and evaporation or, after
treatment, by surface deposition or discharge or through underground injection
wells. Any such disposal must be approved by the governing authority having
jurisdiction over that aspect of the Company's activities. Once mining is
completed, the Company is required to reclaim the surface areas and restore
underground water quality to the level of quality mandated by applicable
regulations or license requirements. A small amount of solid



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discrete surface waste materials generated by the ISL process is disposed of by
delivery to a licensed by-product material disposal site or to a licensed
conventional uranium mill tailings pile. While such sites may not be readily
available in the future, the Company believes that any increase in the cost of
such disposal will continue to be insignificant relative to total costs of
production and will not be a material portion of restoration/reclamation costs.

         In both Texas and New Mexico there are two primary regulatory
authorizations required prior to operations: a radioactive material license and
underground injection control ("UIC") permits which relate both to the injection
of water for production purposes and to the disposal of by-product material
through underground injection wells. Uranium mining is subject to regulation by
the U.S. Nuclear Regulatory Commission ("NRC") under the federal Atomic Energy
Act ("AEA"); however, the AEA also allows for states with regulatory programs
deemed satisfactory by the NRC to take primary responsibility for licensing and
regulating certain activities, such as uranium recovery operations. When a state
seeks this responsibility, it enters into an agreement with the NRC whereby the
NRC agrees to recede from the exercise of most of its counterpart jurisdiction,
leaving the matters to be administered by the state. Texas has entered into such
an agreement; however, New Mexico is not a party to such an agreement.

         The federal Safe Drinking Water Act ("SDWA") creates a nationwide
regulatory program protecting groundwater which is administered by the U.S.
Environmental Protection Agency ("EPA"). To avoid the burden of dual federal and
state (or Indian tribal) regulation, the SDWA allows for the permits issued by
the UIC regulatory programs of states and Indian tribes determined eligible for
treatment as states to suffice in place of a UIC permit required under the SDWA.
A state whose UIC program has been determined sufficient for this purpose is
said to have been granted "primary enforcement responsibility" or "primacy," and
a UIC permit from a state with primacy suffices in lieu of an EPA-issued permit,
provided the EPA grants, upon request by the permitting state, an "aquifer
exemption" or "temporary aquifer designation" modifying the permitting state's
UIC program to recognize the temporary placement of mining fluids into the
intended mining zone within the horizontal confines of the proposed mining area.
Although the EPA's consent to aquifer exemptions or temporary aquifer
designations for certain mineral deposits is often issued almost automatically,
the EPA may delay or decline to process the state's application if the EPA
questions the state's jurisdiction over the mine site. Both Texas and New Mexico
have been granted "primacy" for their UIC programs, and the Navajo Nation has
been determined eligible for treatment as a state but is not due to submit its
program for EPA approval for several years. Until such time as the Navajo Nation
has been granted "primacy," ISL uranium mining activities within Navajo Nation
jurisdiction will require a UIC permit from the EPA. Despite some procedural
differences, the substantive requirements of the Texas, New Mexico and EPA UIC
programs are very similar.

         In addition to its radioactive materials licenses and UIC permit, the
Company is also required to obtain from appropriate governmental authorities a
number of other permits or exemptions, such as for waste water discharge, land
application of treated waste water, or for air emissions.

         The current environmental regulatory program for the ISL industry is
well established. Many ISL mines have gone full cycle through the
permit-operating-restoration cycle without any significant environmental impact.
However, the public anti-nuclear lobby can make environmental permitting
difficult and permit timing less than predictable.

         In Texas, the radioactive materials license required for ISL uranium
mining is granted by the Texas Department of Health ("TDH") and the UIC permits
are granted by the Texas Natural Resource Conservation Commission ("TNRCC"). The
TNRCC also regulates air quality and surface deposition or discharge of treated
wastewater associated with the ISL mining process. In order for a licensee to
receive final release from further radioactive materials license obligations
after all of its mining and post-mining clean-up has been completed, approval
must be issued by the TDH along with concurrence from the NRC.

         In New Mexico, radioactive materials' licensing is handled directly by
the NRC, rather than by the State of New Mexico. Furthermore, depending upon
whether a site located within New Mexico falls under



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state or Navajo Nation jurisdiction, the permitting of the UIC aspects of ISL
mining may be conducted by either the New Mexico Environmental Department
("NMED") or the EPA or possibly both in case of jurisdictional conflict. The
jurisdictional issue when raised as to any development property could result in
litigation between the state and the EPA, with the possibility of delays in the
issuance of affected UIC permits. The Company is currently a party to such
litigation with respect to certain of its New Mexico properties. See
"Litigation".

         Water is essential to the ISL process. It is readily available in South
Texas for the Company's operations and obtaining water rights is not required
because water is subject to capture. In New Mexico the use of water rights is
administered through the New Mexico State Engineer subject to Indian tribal
jurisdictional claims. The State Engineer carefully and strictly regulates
obtaining new water rights, and the transfer or change in use of existing water
rights. The State Engineer may also grant an application for a "temporary water
right" which will not establish a vested right but may provide a sufficient
quantity of water to fulfill the applicant's needs. The State Engineer exercises
jurisdiction over underground water basins with "reasonably ascertainable
boundaries." Accordingly, new appropriations or changes in purpose or place of
use or points of diversion of existing water rights, such as those in the San
Juan and Gallup Basins where the Company's properties are located, must be
obtained by permit from the State Engineer. Applications are required to be
published and are subject to hearing if protested. There are three criteria for
decision, that the application: (1) not impair existing water rights, (2) not be
contrary to the conservation of water within New Mexico, and (3) not be
detrimental to the public welfare. Applications may be approved subject to
conditions that govern exercise of the water rights. Appeals from decisions of
the State Engineer are to the district court of the county in which the work or
point of desired appropriation is situated and from there to the New Mexico
Court of Appeals. Finally, jurisdiction over water rights may become an issue in
New Mexico when an Indian nation, such as the Navajo Nation, objects to the
State Engineer's authority to grant or transfer a water right or to award a
temporary water right, claiming tribal jurisdiction over Indian country. This
issue could result in litigation between the Indian nation and the state which
may delay action on water right applications, and, depending on who prevails as
to any particular property, could result in a requirement to make applications
to the appropriate Indian nation and continuing jurisdiction by the Indian
nation over use of the water. All of the foregoing issues arise to a greater or
lesser extent in connection with the Company's New Mexico properties.

         There can be no assurance that additional regulatory permits or
licenses in Texas or New Mexico, or the applications for water rights in New
Mexico, required for any project of the Company will be approved by the
necessary governing authority in the form contemplated by management, or in any
other form, or within the time periods necessary to commence timely production.
Additionally, regulations and permit requirements are subject to revisions and
changes that may materially affect the Company's operations. Any delay or
failure in obtaining such permits or water rights could materially and adversely
affect the business and operations of the Company.

         In addition to the costs and responsibilities associated with obtaining
and maintaining permits, and the regulation of production activities, the
Company is subject to those environmental laws and regulations applicable to the
ownership and operation of real property in general, including but not limited
to the potential responsibility for the activities of prior owners and
operators.

THE URANIUM INDUSTRY

GENERAL

         The only significant commercial use for uranium is to fuel nuclear
power plants for the generation of electricity. During 2000, 435 nuclear power
plants were operating in the world. It is estimated that these plants consumed
159 million pounds of uranium during 2000.



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MARKET PRICE FORMATION

         At December 31, 2000 the spot price was $7.10 per pound U(3)O(8) (the
form in which the Company sells its production) compared to $9.60 at December
31, 1999. Utility spot market contract activity for uranium decreased by
10.3 million pounds and long-term contracting decreased by 14.3 million pounds
in 2000 from 1999 levels. This lack of demand contributed to the softening of
uranium prices seen in the market in 2000.

SOURCES OF SUPPLY

Traditional Supply Sources

         Based on reports by the Ux Consulting Company, LLC ("Ux") and the
Uranium Institute ("UI"), worldwide production of uranium (U(3)O(8)) for 2000 is
estimated to be approximately 91 million pounds, compared to 81 million pounds
in 1999. This production accounted for approximately 54% of the year's utility
requirements. Production for 2001 is estimated to be 90 million pounds, which
will result in production again meeting only 54% of the estimated 166 million
pounds to be consumed during 2001.

         Production from existing mines is projected by Ux to decline during the
next few years as lower cost resources are exhausted. Accordingly, new
production is expected to replace that from existing mines beginning in the year
2005 with a ramp-up of total production projected by Ux to be 102-103 million
pounds in 2006. This represents approximately 59% of consumption as projected by
the UI for 2006 of approximately 176 million pounds. Consumption has outstripped
production in each year since 1985 with the shortfalls filled by drawdowns of
inventories amassed prior to that time.

Non-Traditional Supply Sources

As excess inventory is reduced, the availability of non-traditional supplies
will play an increasingly important role in establishing market equilibrium.
These supplies consist of Government stockpiles, Russian and U.S. highly
enriched uranium ("HEU"), inventory of the United States Enrichment Corporation
("USEC"), tails re-enrichment, and savings achieved through the reprocessing of
spent fuel. Ux has projected that the following categories represent those
sources of non-traditional supplies that could be available to the market place
through 2005:

         Russian HEU: In 1993, the U.S. and Russia entered into an Agreement to
convert highly enriched uranium ("HEU") derived from dismantling Russian nuclear
weapons into fuel suitable for use in commercial reactors. At a maximum
conversion rate of 30 metric tons HEU per annum approximately 24 million pounds
of U(3)O(8) would be available in each year of which approximately 6.7 million
pounds per year will be used internally by Russia.

         U.S. HEU: Sales are subject to a determination to be made by the
Secretary of Energy, as required under the USEC Privatization Act, that such
sales will have no adverse impact on the domestic mining industry or the
U.S./Russia HEU Agreement.

         USEC Inventory: In July 1998, USEC consummated its privatization with a
public offering of stock. In its prospectus USEC disclosed that it had inventory
of approximately 75 million pounds U(3)O(8) equivalent of which approximately
46-52 million pounds would be available to sell through 2005. This inventory
represents amounts of uranium transferred to it by the DOE. Additional inventory
may be realized through USEC's ability to underfeed its enrichment plants
through the same period.

         Reprocessing: It is expected that reprocessing of spent fuel will save
5-7 million pounds of demand in each year through 2005. This activity is
primarily focused in Europe and Japan.



                                       8
   11

         Tails Re-enrichment: This is a new activity primarily pursued by Russia
in order to utilize their excess enrichment capacity. The Company estimates that
this activity could yield approximately 6.0 million pounds U(3)O(8) per annum
through 2005.

         The potential disposition of Government inventories is the most
significant non-traditional supply factor effecting the market. On March 24,
1999 an agreement between Tenex, the commercial arm of the Russian Federations'
Ministry of Atomic Energy, and three Western commercial entities was executed
that will provide more certainty regarding the disposition of Russian HEU
derived uranium. In an effort to support this transaction and the continuation
of the U.S./Russia HEU Agreement, DOE budgeted $325 million to pay for
approximately 28 million pounds of HEU derived uranium delivered to the U.S.
during 1997-1998. As part of this agreement, DOE will hold this purchased
uranium, and its own remaining inventory (approximately 30 million pounds) off
the market for a ten-year period beginning in 1999.


REQUIRED PRIMARY PRODUCTION

         New production will be needed to fill the gap between utility demand
and the estimated supply sources. This production, however, will not be
forthcoming at current market prices. Further any change in the availability of
non-traditional supplies or the emergence of additional non-traditional sources
could impact the need for new production.

URANIUM PRICES

         Spot prices reflect the price at which uranium may be purchased for
delivery within one year. Historically, spot prices have been more volatile than
long-term contract prices, increasing from $6.00 per pound in 1973 to $43.00 per
pound in 1978, then declining to a low of $7.25 per pound in October 1991. The
spot price per pound was $7.10 at December 31, 2000 and $8.25 at April 9, 2001.

         The following graph shows spot prices per pound from 1980 to March 31,
2001, as reported by Trade Tech.

                                     [CHART]

                 AVERAGE ANNUAL SPOT PRICE PER POUND OF URANIUM



                    PRICE
                     PER
                    POUND
                    -----
                 
         1980      $31.79
         1981       24.19
         1982       19.90
         1983       22.98
         1984       17.27
         1985       15.60
         1986       17.00
         1987       16.78
         1988       14.55
         1989       10.00
         1990        9.76
         1991        8.70
         1992        8.53
         1993        9.98
         1994        9.31
         1995       11.46
         1996       15.60
         1997       12.00
         1998       10.22
         1999       10.21
         2000        8.15
         2001        7.74


- ---------
All prices beginning in 1993 represent U(3)O(8) deliveries available to U.S.
utilities.



                                       9
   12

COMPETITION

         The Company markets uranium to utilities in direct competition with
supplies available from various sources worldwide. The Company competes
primarily on the basis of price.

ITEM 2. DESCRIPTION OF PROPERTIES

SOUTH TEXAS PRODUCING PROPERTIES

         The Company has two properties located in South Texas, Rosita and
Kingsville Dome. These properties have had recent production, one of which
(Kingsville Dome) would be capable of resuming production given improved market
conditions and available funding. The following is a description of these
properties.

KINGSVILLE DOME

         The Property. The Kingsville Dome property consists of mineral leases
from private landowners on 3,068 gross (3,043 net) acres located in central
Kleberg County, Texas. The leases provide for royalties based upon uranium
sales. The leases have expiration dates ranging from 2000 to 2007. With a few
minor exceptions, all the leases contain shut-in royalty clauses, which permit
the Company to extend the leases not held by production by payment of a royalty.

         Production History. Initial production commenced in May 1988. In May
1989, due to the continuing decline in the spot price of uranium, the Company
deferred development of the next wellfield, and the plant was shut-in in
September 1990. Total production from May 1988 through September 1990 was
approximately 1.5 million pounds.

         Wellfield development activities resumed in December 1995 and
production commenced in March 1996. Production at Kingsville Dome was
approximately 2.0 million pounds from recommencement of production in March 1996
through July 1999 with 61,000 pounds produced in 1999.

         The Company shut-in and placed on stand-by production at the Kingsville
Dome site in the first quarter of 1999 because of depressed uranium market
conditions. Nominal production from this site continued until July 1999 when the
incremental production costs at this facility exceeded the cost of purchasing
uranium in the marketplace.

         Further Development Potential. Further exploration and development
activities are not currently planned and are not anticipated until uranium
market conditions firm. The Company believes that there is a significant
quantity of uranium resource remaining at the Kingsville Dome site that would be
mined if market conditions were favorable and sufficient funding for delineation
and development were available. The Company spent approximately $105,000 in
capital expenditures in 2000 and does not project to make significant
expenditures in 2001.

         Permitting Status. Radioactive material licensing and UIC permit
hearings for currently producing areas have been completed, and the necessary
permits were issued. In the first quarter of 2000 the District Court of Travis
County Texas ruled that the decision of the TNRCC to grant the Company's PAA#3
without granting a hearing to certain intervenors in the case would require
further review by the TNRCC. The District Court remanded the issue back to the
TNRCC for further action which has the effect of placing the Company's PAA#3 on
hold from future production pending a decision by the TNRCC. The Company
anticipates a favorable outcome in this matter. With regard to future production
areas certain minor amendments to the license and permit for further production
within the permit area will be required as development proceeds. The term of the
license and UIC permit is effectively open-ended.



                                       10
   13

         Restoration and Reclamation.

         In October 2000 the Company finalized an agreement with Texas
regulatory authorities and the Company's bonding company, that provided the
Company access to up to $2.2 million in funding for restoration. Approximately
$1,527,000 has been released to the Company through March 31, 2001 to perform
restoration at the Company's Kingsville Dome and Rosita mine sites. The term of
the restoration agreement runs through the end of 2001. The Company incurred
approximately $415,000 in restoration costs at the Kingsville Dome site from
July to December 2000 under the restoration agreement.

ROSITA

         The Property. The Rosita property consists of mineral leases on 3,359
gross and net acres located in northeastern Duval County, Texas. All the leases,
except minor leases, are held by production. The leases provide for royalties
based upon uranium sales.

         Production History. The Company began initial production at Rosita in
October 1990. Total production from Rosita for the eighteen months through March
31, 1992 was approximately 1.1 million pounds. In March 1992, due to depressed
uranium prices, the Company shut-in production.

         Wellfield development activities resumed at Rosita in March 1995 and
production recommenced in June 1995. From that date through July 1999
approximately 1.6 million pounds were produced with 48,000 pounds produced in
1999.

         The Company shut-in and placed on stand-by production at the Rosita
site in the first quarter of 1999 because of depressed uranium market
conditions. Nominal production from this site continued until July 1999 when the
incremental production costs at this facility exceeded the cost of purchasing
uranium in the marketplace.

         Further Development Potential. The Company estimates that there are
approximately 261,000 recoverable pounds of uranium remaining to be produced
from the Rosita project. The timing of production from this property will be
dependent upon future uranium prices, the availability of sales contracts and
the availability of capital. The Company spent approximately $160,000 for
development activities, permitting and land holding costs in 2000. Significant
expenditures for these activities are not expected in 2001.

         Permitting Status. Radioactive materials licensing and UIC permit
hearings for currently producing areas have been completed, and the necessary
permits have been issued. Some minor amendments for further production within
the permit area will be required as development proceeds. The term of the
license and UIC permit is effectively open-ended.

         Restoration and Reclamation.

         The Company incurred approximately $410,000 in restoration costs at the
Rosita site from July to December 2000 under the restoration agreement with the
Texas regulatory agencies and the Company's bonding company.


SOUTH TEXAS DEVELOPMENT PROPERTIES

VASQUEZ

         The Property. The property consists of two mineral leases on 842 gross
and net acres located in southwestern Duval County, Texas.



                                       11
   14

         The secondary lease term for this property expired in February 2000.
URI tendered payment under the shut-in royalty clause of the lease in 2000 and
2001 and also holds its rights to the property through continuous development
clauses in the lease. The lessor returned the Company's shut-in royalty payments
for 2000 without disclosing their reasons for rejecting the Company's payment.
The Company believes that it will continue to hold its rights to the property
under either the shut-in royalty or the continuing development clauses of the
lease. The leases provide for royalties based on uranium sales.

         Reserves. The Company estimates that the property contained
approximately 2.8 million pounds of recoverable resources at December 31, 2000.

         Development Plan. The timing of production will be dependent on a
number of factors. Prior to the commencement of production at Vasquez the
Company will require new capital inflows of approximately $2.5 million for
construction, development and financial surety needs.

         Permitting Status. All of the required permits for this property have
been received from the TNRCC and the TDH.


NEW MEXICO DEVELOPMENT PROPERTIES

GENERAL

         The Company has various interests in properties located in the
Churchrock and Crownpoint districts in New Mexico. As to these properties, the
Company holds both patented and unpatented mining claims, mineral leases and
some surface leases from private parties, the Navajo Nation and Navajo
allottees. In addition, in March 1997, the Company acquired from Santa Fe
certain uranium mineral interests and exploration rights for uranium on
significant acreage in New Mexico, a small portion of which falls within the
Churchrock district.

         In keeping with its overall corporate strategy, the Company's
development plan for its New Mexico properties will proceed incrementally,
subject to timely permitting, the availability of water rights, the availability
of sales contracts and the availability of capital. The Company plans to develop
the Churchrock district first and the Crownpoint district next.

REGULATORY FRAMEWORK

         NRC License. In New Mexico, uranium production requires a radioactive
materials license issued by the NRC. The Company has applied for one NRC license
covering all properties located in both the Churchrock and Crownpoint districts
(except the Mancos property) and has included the properties in both districts
(except the Mancos leases) under one Final Environmental Impact Statement
("FEIS"), which is a prerequisite for the NRC license.

         The NRC finalized and completed the publication of the FEIS in the
first quarter of 1997. The NRC issued an operating license in January 1998 that
would allow operations to begin in the Churchrock district. In mid-1998, the NRC
determined that certain Churchrock and Crownpoint residents who requested a
hearing were qualified as to standing. Under the source materials licensing
procedures of the NRC, a hearing covering the license was conducted during 1999.
The administrative law judge has ruled on all of the contentions and upheld the
license. Subsequently, the ruling by the administrative law judge was appealed
to the full NRC. On January 31 the full Nuclear Regulatory Commission ruled on
the Churchrock License and concurred with the technical, substantive and legal
findings of the Atomic Safety Licensing Board Presiding Officer for the
Churchrock Section 8 site. The Commission also determined that the Company must
proceed with the hearing process for other New Mexico properties beyond
Churchrock



                                       12
   15

Section 8. It is projected that the hearing process will resume in early 2002.
Although all the decisions to date have been favorable to the Company, there can
be no assurance that the license will be maintained in its current form allowing
the Company to proceed with its planned operations, or that the NRC process will
be concluded on a timely basis.

         UIC Permit. NMED has jurisdiction under the New Mexico Water Quality
Act to regulate UIC activities within the State of New Mexico, and the New
Mexico UIC program has received "primary enforcement responsibility" from the
EPA under the federal SDWA. However, by the terms of regulations issued by the
EPA and the primacy determination made for the State of New Mexico, New Mexico's
UIC primacy does not extend to New Mexico's exercise of UIC regulation or
permitting over facilities located on "Indian lands," a term whose geographic
reach the EPA has defined as coextensive with that of "Indian country". Because
even a permit issued by a state holding UIC primacy cannot suffice in lieu of a
federal UIC permit issued under the SDWA unless the EPA issued a corresponding
aquifer exemption or temporary aquifer designation, the EPA's opinion that a
site lies within Indian country virtually compels a state UIC applicant to
secure an EPA UIC permit for UIC activities to be conducted on such a site.

         In addition to the EPA's assertions, the Navajo Nation claims
regulatory jurisdiction over a significant portion of the Company's New Mexico
development properties. These claims subject the development of those properties
within the area claimed as "Indian country" to further uncertainties, including
a potential for delays in UIC permitting. For certain properties not permitted
by the EPA at the time a Navajo regulatory program is promulgated and accepted
by the EPA for a determination of primacy, the Company would then apply to the
Navajo EPA for its UIC permits. Although a Navajo UIC program may adopt unique
application, permitting, and enforcement procedures, it would, nonetheless, be
required to impose virtually the same substantive requirements that the Company
is prepared to satisfy under existing New Mexico and EPA UIC programs.

         This dispute over UIC jurisdiction is currently focused on a portion of
the Churchrock and Crownpoint properties. Despite this current jurisdictional
dispute among the EPA, the State of New Mexico, and the Navajo Nation, the
Company maintains good relations with the State of New Mexico, the Navajo
Nation, and the EPA. However, there can be no assurance that the jurisdictional
dispute will not have a material adverse effect on the Company's development
plans in New Mexico.

         Water Rights. For general information on water rights in New Mexico,
see "Business-Environmental Considerations and Permitting; Water Rights."

CHURCHROCK DISTRICT

         The Property. The Churchrock properties encompass 2,225 gross and net
acres and include mineral leases, patented mining claims and unpatented mining
claims. The properties are located in McKinley County, New Mexico, and consist
of three parcels, known as Section 8, Section 17 and Mancos. None of these
parcels lies within the area generally recognized as constituting the Navajo
Reservation. The Company owns the mineral estate in fee for both Sections 17 and
the Mancos properties. The surface estate on Section 17 is owned by the U.S.
Government and held in trust for the Navajo Nation. The Company owns patented
and unpatented mining claims on Section 8.

         Resources. The Company estimates that as of December 31, 2000, Section
8 contained approximately 4.2 million pounds of recoverable uranium resources.
Section 17 contained approximately 5.5 million pounds of recoverable resources
and the Mancos property contained approximately 2.7 million pounds of
recoverable resources.

         Development Plan. It is anticipated that the first property to be
developed will be Churchrock. Costs related to permitting activities and land
holding costs were approximately $110,000 in 2000. The Company does not
anticipate significant spending for permitting and land holding costs in 2001.
The Company anticipates having to demonstrate financial surety in connection
with production activities.



                                       13
   16

         Water Rights. The Company originally acquired mineral leases on
Sections 8 and 17 from United Nuclear Corporation ("UNC") and, in connection
therewith, acquired certain rights to use water from UNC. An application to use
one of these rights was the subject of extensive administrative proceedings and
litigation with the New Mexico State Engineer and the Navajo Nation over the
nature and extent of UNC's water rights. The State Engineer approved HRI's water
rights application in October 1999 and granted it sufficient water rights for
the life of the Churchrock mine.

         Permitting Status. On June 21, 1989 the EPA issued its aquifer
exemption covering that portion of the Churchrock site known as Section 8, and
on November 1, 1989, NMED issued its permit, covering UIC activities on Section
8. On October 7, 1994, NMED issued an amended permit covering UIC activities on
both Section 8 and Section 17. The permit for Section 17 was contested by the
Navajo Nation who claimed UIC regulatory jurisdiction over the site, based on
the fact that the surface estate is owned by the Navajo Nation. The EPA, acting
as an advocate for the Navajo Nation, has asserted the Navajo Nation's claim and
has refused to amend its previously issued aquifer exemption covering Section 8
to add the portion of the Churchrock facility on Section 17. The Company does
not plan to pursue permits for Mancos at this time.

         In June 1996, the Company filed with the NMED two applications to renew
the permit in two distinct parts, one covering the Section 8 portion and the
other the Section 17 portion of Churchrock. This was to assure that the Company
maintained a "clear" UIC authorization on the Section 8 portion of the site. The
surface estate on Section 8 is not owned by the Navajo Nation or Navajo
allottees. Because the renewal application was timely filed, the permit covering
the Section 8 property has remained continuously in effect pending final
determination on the renewal application by the NMED.

         The Navajo Nation has asserted jurisdiction over the UIC for Section 8,
claiming that the land lies within a "dependent Indian community." While the EPA
has not yet taken a final position on this issue, they have determined that a
dispute does exist between the NMED and the Navajo tribe. As a result of this
dispute, the EPA has indicated that an EPA permit will be required on this
property. The State of New Mexico and the Company appealed the action of the EPA
to the United States Court of Appeals for the Tenth Circuit. The Tenth Circuit
in January 2000, determined that EPA had jurisdiction and remanded the matter
back to EPA for further evaluation. The Company cannot predict the impact of
this decision and there can be no assurance that EPA will reissue a UIC permit
in its current form or on a timely basis. This situation could potentially delay
or obstruct development of Section 8.

CROWNPOINT DISTRICT

         The Property. The Crownpoint properties are located in the San Juan
Basin, 22 miles northeast of the Company's Churchrock deposits and 35 miles
northeast of Gallup, New Mexico, adjacent to the town of Crownpoint. The
Properties consist of 1,578 gross and net acres, as follows:

                  (a) 162 gross and net acres on Section 24. The Company has
         100% of the mineral estate on this acreage pursuant to a combination of
         a 40% fee interest, a mineral lease on the other 60% of the mineral
         estate unpatented mining claims. This acreage is subject to an
         obligation of the Company to pay a production payment on the first
         50,000 pounds of uranium produced and an override based on uranium
         sales;

                  (b) 959 gross and net acres on Sections 19 and 29 pursuant to
         a lease from private mineral owners (expiring August 2007) which
         provides for royalties and an override based on uranium sales; and

                  (c) 457 gross and net acres of unpatented mining claims in
         Sections 9, 24 and 25.



                                       14
   17

         Resources. With respect to all the Crownpoint acreage, the Company
estimates as of December 31, 2000, the property contained approximately 25.3
million pounds of recoverable resources.

         Development Plan. The New Mexico properties will be developed according
to the license conditions issued by the NRC. Under the license, the first
operating property will be Churchrock followed by Crownpoint. Costs relating to
permitting activities and land holding costs for Crownpoint were $200,000 in
2000, and are not expected to be significant in 2001.

         Water Rights. With respect to Crownpoint and Unit I, the Company has
acquired three applications for appropriations of water which give the Company
the first three "positions in line" on the hearings list for the San Juan Basin.
Certain aspects of all three applications were protested and were subject to
hearings, however all protests were subsequently withdrawn. On January 4, 2001
the State Engineer remanded the three applications to the Water Rights Division
staff for further review and analysis. The Company has informed the Water Rights
Division staff that it intends to proceed with the three pending applications.
Water rights relating to Unit 1 may likely involve the claim of the jurisdiction
of the Navajo Nation, and this jurisdictional issue might also be present for
other parts of Crownpoint.

         Permitting Status. The NRC license is part of the overall development
plan for both the Churchrock and Crownpoint districts discussed above. The
Company has recently submitted a revised UIC permit application for Section 24.
There can be no assurance that the UIC permit will be granted. The surface
estate on Section 19 and 29 is owned by the U.S. Government and held in trust
for the Navajo Nation and may be subject to the same jurisdictional dispute as
for Section 17 in Churchrock.

         Unit I Property. In addition to the foregoing, at December 31 1999 the
Company had 1,440 gross and net acres of mineral leases on nine separate parcels
(hereinafter referred to as "Unit 1") from Navajo allottees who are the
beneficial owners of the surface and mineral rights. The leases have been and
are subject to approval by the Bureau of Indian Affairs (the "BIA"). Such
approval had not been received at December 31, 1999 and as a result, the Company
reviewed each of the nine agreements to determine those that have been executed
by all the necessary parties to finalize each agreement. Three of the agreements
have received the required signatures from the allottees to complete the leases.
The remaining six require additional efforts to complete the leasing process. As
a result of this review, the Company has requested that the BIA return those
funds that have been held in escrow related to those six leases that require
further completion. This request was made and the Company received funds
totaling approximately $440,000 in the first quarter of 2000 related to these
leases.


SANTA FE PROPERTIES

GENERAL

         In March 1997 the Company acquired from Santa Fe certain uranium
mineral interests and exploration rights for uranium in New Mexico.

         The Properties. The properties consist of: (a) 37,000 acres as to which
the Company has acquired a fee interest in the entire mineral estate, excluding
coal ("Category I Properties"); (b) approximately 140,000 acres as to which the
Company has acquired the fee interest in uranium (the "Category II Properties");
and (c) approximately 346,000 acres as to which the Company has acquired the
exclusive right to explore for uranium and other minerals excluding coal (the
"Category III Properties").

         The Company is obligated to spend on exploration $200,000 per year for
the ten-year period starting in March 1997 and $400,000 per year for the
seven-year period starting in March 2007. This expenditure can be made on any of
the Category II or Category III properties. The Company intends to seek a waiver
of this requirement for 2001.



                                       15
   18

         The license is for 17 years, expiring in March 2014. In the event that
the sale price of uranium shall exceed $25 per pound for any twelve-month period
URI has committed to spend on exploration (or pay to Santa Fe) during the
following 5 years an aggregate of $5 million; and in the event that the sale
price of uranium shall exceed $30 per pound for any twelve-month period URI has
committed to spend on exploration (or pay to Santa Fe) during the following 5
years an aggregate of $10 million.

         With respect to Category II and Category III properties, at such time
as URI shall apply for a mining permit with respect to any such properties Santa
Fe has the right to put the remaining mineral interests owned by it (excluding
coal) to the Company at a price of $200 per acre for any acreage in any section
which is covered by the mining application. The acreage price shall be increased
by the same percentage as the percentage increase in the price of uranium on the
date of such application over $15.80 per pound. URI has the option to purchase
at any time the entire mineral estates (excluding coal) on such properties on
the same terms.

         Resources. The Company estimates that the Category I Properties contain
9.6 million pounds of recoverable resources.

         Development Plan. The planned development strategy is to integrate
qualified properties from the Santa Fe lands into the production plans for
Churchrock and Crownpoint.

         Exploration Potential. There is significant exploration potential for
the Santa Fe properties. Numerous ore grade holes drilled on the properties
demonstrates this potential; however, because the deposits are not delineated,
development costs are uncertain.


RECLAIMED PROPERTIES

         The Company has completed production and groundwater restoration on its
Benavides and Longoria projects in South Texas. The Company completed the final
stages of surface reclamation on these projects and received full and final
release for these sites in 1999.

         The Company acquired the Section 17 leases in the New Mexico Churchrock
district from United Nuclear Corporation ("UNC"). UNC had conducted underground
mining for uranium on Section 17 and had reclaimed these properties. In
connection with the acquisition, the Company assumed any liability of UNC for
any remaining remediation work that might be required. NMED has not determined
what, if any, additional remediation will be required under the New Mexico
Mining Act. If more remediation work is required, the Company believes it will
not involve material expenditures.

RECLAMATION AND RESTORATION COSTS AND BONDING REQUIREMENTS

         Upon completion of production from a wellfield, the Company is
obligated under state and federal law to restore the aquifer to a condition
consistent with its pre-mining use. This involves restoration of the aquifer,
plugging and abandoning the injection and production wells and reclaiming the
surface. With respect to operations at Kingsville Dome and Rosita the TNRCC and
TDH requires the Company to provide financial surety to cover the costs of such
restoration and reclamation. The surety bond requirement at December 31, 2000
was approximately $5.6 million. The Company fulfills this requirement through
the issuance of surety bonds from the United States Fidelity and Guaranty
Company ("USF&G") and has deposited as collateral for such bonds cash of
approximately $2.8 million. The Company is obligated to fund the cash collateral
account with an additional $0.50 for each pound of uranium production until the
account accumulates an additional $1.0 million. The Company estimates that its
future reclamation liabilities with respect to current operations at December
31, 2000 approximates $4.4 million, which has been charged to earnings. These
financial surety obligations are reviewed and revised annually by the TNRCC and
TDH.



                                       16
   19

         The Company anticipates that it will be required to provide financial
surety of approximately $1.0 million as a condition to receipt of the requisite
permits for the mining of the Vasquez project.

         In New Mexico surety bonding will be required prior to development of
the properties. The Company anticipates that it will be required to provide
financial surety as a condition to receipt of the requisite permits for the
Churchrock project. The amount of the surety bond will be subject to annual
review and revision by the NRC and State of New Mexico.

ITEM 3. LEGAL PROCEEDINGS

BENTON BANKRUPTCY

         During 1994, the Company engaged in certain transactions with companies
controlled by Mr. Oren L. Benton (the "Benton Companies"). In 1995, Benton and
various of the Benton Companies filed for protection under Chapter 11 of the
Federal Bankruptcy Code (the "Benton Bankruptcy"). In 1998 the Trustee sought
recovery of approximately $1.6 million of payments made by certain of the Benton
Companies to the Company, claiming that the payments and advances were avoidable
as preferential and/or fraudulent transfers. On July 17, 2000, the parties
entered into a settlement agreement whereby the Company issued a $135,000
Convertible Note due July 17, 2005, assigned its rights under a $65,000
Promissory Note from Benton and assigned certain claims against Union Bank of
Switzerland in settlement of the complaint. Interest on the Convertible Note is
due at maturity and the Note bears interest at rate of 6% per annum. The Company
may prepay the Note at any time and the holder of the Note may convert all
principal and accrued interest into shares of the Company's common stock at a
conversion price of $0.75 per share.

OTHER
         The Company is subject to periodic inspection by certain regulatory
agencies for the purpose of determining compliance by the Company with the
conditions of its licenses. In the ordinary course of business, minor violations
may occur; however, these are not expected to cause material expenditures.


INDIAN LANDS JURISDICTIONAL DISPUTE

         See "Churchrock District-Permitting Status" for a discussion of
permitting jurisdiction over certain of the Company's mineral properties in New
Mexico.


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

         In March 2001 the Company's stockholders approved an amendment to the
Company's Restated Certificate of Incorporation to increase the authorized
shares of Common Stock, par value $0.001 per share (the "Common Stock"), from
35,000,000 to 100,000,000. Stockholders also approved an amendment to the
Company's 1995 Stock Incentive Plan (the "1995 Plan") to increase the number of
shares of the Company's Common Stock eligible for issuance under the 1995 Plan
from 1,250,000 shares to 4,000,000 shares.

                                   ----------

           CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR"
       PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995



                                       17
   20

         The Company is including the following cautionary statement to take
advantage of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995 for any forward-looking statement made by, or on behalf of,
the Company. The factors identified in this cautionary statement are important
factors (but not necessarily all of the important factors) that could cause
actual results to differ materially from those expressed in any forward-looking
statement made by, or on behalf of, the Company. Where any such forward-looking
statement includes a statement of the assumptions or bases underlying such
forward-looking statement, the Company cautions that, while it believes such
assumptions or bases to be reasonable and makes them in good faith, assumed
facts or bases almost always vary from actual results, and the differences
between assumed facts or bases and actual results can be material, depending
upon the circumstances. Where, in any forward-looking statement, the Company, or
its management, expresses an expectation or belief as to the future results,
such expectation or belief is expressed in good faith and believed to have a
reasonable basis, but there can be no assurance that the statement of
expectation or belief will result, or be achieved or accomplished. Taking into
account the foregoing, the following are identified as important risk factors
that could cause actual results to differ materially from those expressed in any
forward-looking statement made by, or on behalf of, the Company:

COMPANY LIQUIDITY

         As a result of the depressed spot prices in the uranium marketplace,
the Company shut-in and placed on stand-by its two South Texas facilities in the
first quarter of 1999. Nominal production from these sites continued to July
1999 until their incremental production costs exceeded the cost of purchasing
uranium in the marketplace. The Company continues perform activities at these
locations related to its ongoing groundwater restoration efforts.

         Between August 2000 and April 2001 the Company entered into a series of
equity transactions which raised $2.835 million in proceeds to the Company. In
October 2000 the Company finalized an agreement with Texas regulatory
authorities and the Company's bonding company, that provides the Company access
to up to $2.2 million in additional funding for restoration activities. The term
of the restoration agreement runs through the end of 2001.

         Assuming that the Company is able to continue funding its restoration
of the Kingsville Dome and Rosita mine sites through extensions to restoration
agreement, the Company estimates that the cash generated from its most recent
equity infusion should provide it with the resources to remain operating into
approximately the first quarter of 2003. Additional funds will be required for
the Company to continue operating after that date. The Company cannot guarantee
that it will be able to extend such agreement beyond 2001, or that any extension
of the agreement that is negotiated will contain the same terms and conditions
as the current agreement.

         Even if the market price of uranium increases and the demand for new
production increases, there can be no assurance that the Company can survive
long enough to participate in these changes or that it will have access to the
capital necessary to bring new production on line.

CONTINUING SIGNIFICANT CAPITAL REQUIREMENTS

         An ISL mining operation requires a substantial amount of capital prior
to the commencement of, and in connection with, production of uranium, including
costs related to acquiring the rights to mine uranium, securing regulatory
permits and licenses, exploration and definitional drilling to determine the
underground configuration of the ore body, designing and constructing the
uranium processing plant, drilling and developing in order to establish the
infrastructure for the production wells for each wellfield and complying with
financial surety requirements established by various regulatory agencies
regarding the future restoration and reclamation activities for each property.

         The Company expects to be able to fund its 2001 and 2002 capital
requirements from existing cash sources



                                       18
   21

POTENTIAL ADVERSE EFFECT OF FEDERAL AND STATE REGULATIONS

         The development and production of uranium is subject to extensive
governmental regulations that materially affect the economics of the Company's
operations and the timing of project development. To produce uranium, the
Company must secure and maintain multiple permits, obtain adequate water rights
and comply with extensive federal, state and potential tribal regulations for
environmental protection, including regulations relating to air and water
quality, the prevention of groundwater contamination, the reclamation and
restoration of wellfield aquifers and the treatment, transportation and disposal
of liquid and/or byproduct material and solid wastes generated by the Company's
uranium mining and processing activities. To date, the Company's operations have
not been materially and adversely affected by the inability to obtain or
maintain required permits or water rights or by any groundwater contamination or
the disposal of waste or byproduct material. However, should the Company be
unable to obtain or maintain permits or water rights for development of its
properties or otherwise fail to adequately handle future environmental issues,
the Company's operations could be materially and adversely affected by
expenditures or delays in the Company's ability to initiate or continue
production at its properties.

         The Company must obtain all necessary permits from the appropriate
governmental agency before it can commence production at any of its development
properties. The Company's future production is highly dependent on its ability
to bring these development properties into production. Applications for
permitting of certain of these properties have been filed. There can be no
assurances that all the necessary permits will be obtained or that such permits
will be obtained in a timely manner. Any significant delays in obtaining the
necessary permits could have a material adverse effect upon the Company and its
developmental plans for these properties.

         The Company has expended significant resources, both financial and
managerial; to comply with environmental protection laws, regulations and
permitting requirements and anticipates that it will be required to continue to
do so in the future. Although the Company believes its producing properties
comply in all material respects with all relevant permits, licenses and
regulations pertaining to worker health and safety as well as those pertaining
to the environment, the historical trend toward stricter environmental
regulation may continue. The uranium industry is subject to not only the worker
health and safety and environmental risks associated with all mining businesses,
but also to additional risks uniquely associated with uranium mining and
processing. The possibility of more stringent regulations exists in the areas of
worker health and safety, the disposal of wastes and byproduct material, the
decommissioning, decontamination and reclamation of mining, milling, refining
and conversion sites, and other environmental matters, each of which could have
a material adverse effect on the costs or the viability of a particular project.

         The Company is required to provide financial surety to state
environmental agencies for plugging wells, groundwater restoration and site
decommissioning, decontamination and reclamation. The Company estimates that
it's current restoration, decommissioning, decontamination and reclamation costs
are approximately $4.4 million, which amount the Company has accrued as a
liability on its financial statements. The Company satisfied its financial
surety requirements imposed by environmental regulators with surety bonds
totaling approximately $5.6 million at December 31, 2000, $2.8 million of which
is collateralized by the Company with cash. The Company anticipates that its
future financial surety requirements will increase significantly when future
development and production occurs at its sites in Texas and New Mexico. The
amount of the financial surety for each producing property is subject to annual
review and revision by regulators. There can be no assurance that the Company
will have sufficient capital to meet these future financial surety obligations.

NEED TO REPLACE RESERVES

         When in production, the Company's producing uranium mines are, in
general, characterized by a series of individual wellfields that produce at
differing declining production rates. Each wellfields



                                       19
   22

production decline rate depends on ore reserve characteristics, and, in the case
of the Company, varies from a steep decline rate of six months, to a relatively
slow production decline rate of eighteen months. The Company's future uranium
reserve production, and therefore cash flow and income, are highly dependent
upon the Company's level of success in exploiting its current resources and
acquiring or developing additional reserves. Reserves at the Company's producing
sites were depleted in 1999, although there is the potential for developing
additional wellfields at Kingsville Dome. There can be no assurance that the
Company's development properties will be placed into production or that the
Company will be able to continue to find and develop or acquire additional
reserves.

COMPETITION

         There is global competition in the uranium industry for mineral
properties, capital, customers and the employment and retention or qualified
personnel. In the production and marketing of uranium concentrates there are
approximately 15 major uranium-producing entities, some of which are government
controlled and all of, which are significantly larger and better, capitalized
than the Company.

         The Company competes with larger producers in Canada, Australia and
Africa, as well as with other United States ISL producers of uranium and other
producers that recover uranium as a by-product of other mineral recovery
processes. The Company also expects to compete with uranium recovered from the
de-enrichment of highly enriched uranium obtained from the dismantlement of U.S.
and Russian nuclear weapons and sold in the market by the United States
Enrichment Corporation and/or the United States Department of Energy, as well as
from imports to the United States of uranium from the CIS. The amount of uranium
produced by competitors or imported into the United States may have a material
impact on uranium prices.

URANIUM PRICE VOLATILITY

         The Company's existence is dependent on the price of uranium, which is
determined primarily by global supply and demand and by the relationship of that
price to the Company's costs of production. Historically, uranium prices have
been subject to fluctuation, and the price of uranium has been and will continue
to be affected by numerous factors beyond the Company's control, including the
demand for nuclear power, political and economic conditions, and governmental
legislation in uranium producing and consuming countries and production levels
and costs of production of other producing companies. Certain of the Company's
current long and medium-term contracts have pricing mechanisms related to spot
market prices. In recent years, prior to 1996, imports of uranium, including
imports of uranium from the CIS, have resulted in significant downward pressure
on uranium prices.

         The spot market price for uranium has demonstrated a large range since
January 1995. Prices have risen from $9.65 per pound as of January 31, 1995 to a
high of $16.50 per pound as of May 31, 1996. The spot price as of December 31,
2000 and March 31, 2001 was $7.10 and $8.25 per pound, respectively.

URANIUM CONTRACT PORTFOLIO

         Long-term contracts have historically been the primary source of
revenue to the Company. At the beginning of 1999 the Company had four long-term
contracts for deliveries over the next two, three and four years of
approximately $26.9 million in revenues. During 1999, the Company assigned its
delivery rights for 2000 through 2002 under one of these contracts and also
accelerated the scheduled deliveries under another contract into the fourth
quarter of 1999. These transactions coupled with additional transactions made in
the first quarter of 2000 converting the value of the Company's long-term sales
contracts into cash have had the effect of exhausting its sales contract
portfolio. Currently, the Company does not have any remaining scheduled uranium
deliveries under contract for 2001 or beyond.

         The Company must secure new profitable uranium sales contracts as the
basis for its continued long-term existence. Demonstrated profitability under
such new contracts will form the basis for the



                                       20
   23

Company to be able to secure the requisite financing/equity infusion to resume
production at its mine sites. The profitability under such new contracts will
depend on a number of factors including the cost of producing uranium at the
Company's mining properties, the Company's ability to produce uranium to meet
its sales commitments and the spot market price of uranium.

LIMITED MARKET; DEPENDENCE ON A FEW CUSTOMERS

         The Company's primary source of revenue is derived from its sale of
uranium to U.S. nuclear power plants. Uranium's only current commercial use is
as fuel for nuclear power reactors. Accordingly, the Company's past and
potential customers are electric utilities that operate nuclear power plants.
The United States is the world's largest producer of nuclear-generated
electricity. There can be no assurance that the Company can continue to compete
successfully for such customers.

         Historically, a significant portion of the Company's contracted sales
of uranium has been from a small number of customers. This trend is expected to
continue if the Company is able to secure new sales contracts. The inability to
secure these new customers or the loss of any of these customers or curtailment
of purchases by such customers would have a significant materially adverse
effect on the Company including its inability to remain in business.

COMPETITION FROM ALTERNATIVE ENERGY SOURCES AND PUBLIC ACCEPTANCE OF NUCLEAR
ENERGY

         Nuclear energy competes with other sources of energy, including oil and
gas, coal and hydro-electricity. These alternative energy sources are to some
extent interchangeable with nuclear energy, particularly over the longer term.
Lower prices of oil, gas, coal and hydro-electricity for an extended period of
time, as well as the possibility of developing in the future other low cost
sources for energy, have made and could continue to make nuclear power a less
attractive fuel source for the generation of electricity, thus resulting in
lower demand for uranium. Furthermore, the growth of the uranium and nuclear
power industry beyond or maintenance at its current level will depend upon
continued and increased acceptance of nuclear technology as a means of
generating electricity. Because of unique political, technological and
environmental factors that affect the nuclear industry, the industry is subject
to public opinion risks which have and could continue to have an adverse impact
on the demand for nuclear power and increase the regulation of the nuclear power
industry.

POTENTIAL ADVERSE IMPACT OF LOSS OF KEY PERSONNEL

         Certain of the Company's employees have significant experience in the
uranium ISL mining industry. The number of individuals with ISL experience is
small. The continuation of the Company is dependent upon the efforts of these
key individuals, and the loss of any one or more of such persons' services could
have a material adverse effect on the Company's business operations and
prospects.

MINING RISKS AND INSURANCE

         The business of uranium mining generally is subject to a number of
risks and hazards, including environmental hazards, industrial accidents,
flooding, interruptions due to weather conditions and other acts of nature. Such
risks could result in damage to or destruction of the Company's wellfield
infrastructure and production facilities, as well as to adjacent properties,
personal injury, environmental damage and processing and production delays,
causing the Company monetary losses and possible legal liability. While the
Company maintains, and intends to continue to maintain, liability, property
damage and other insurance consistent with industry practice, no assurance can
be given that such insurance will continue to be available, be available at
economically acceptable premiums or be adequate to cover any resulting
liability.



                                       21
   24

                            GLOSSARY OF CERTAIN TERMS



                                         
claim...............................        A claim is a tract of land, the right to mine of which is held under the
                                            federal General Mining Law of 1872 and applicable local laws.

concentrates........................        A product from a uranium mining and milling facility, which is commonly
                                            referred to as uranium concentrate or U(3)O(8).

conversion..........................        A process whereby uranium concentrates are converted into forms suitable for
                                            use as fuel in commercial nuclear reactors.

cut-off grade.......................        Cut-off grade is determined by the following formula parameters: estimates
                                            over the relevant period of mining costs, ore treatment costs, general and
                                            administrative costs, refining costs, royalty expenses, process and refining
                                            recovery rates and uranium prices.

gross acres.........................        Total acres under which the Company has mineral rights and can mine for
                                            uranium.

Indian country......................        A term derived from jurisdictional determinations in criminal law
                                            enforcement proceedings under 18 U.S.C. Section 1151 and understood to encompass
                                            territory situated within Indian reservations, land owned by Indian
                                            allottees and land within a dependent Indian community.

lixiviant...........................        When used in connection with uranium in situ leach mining, a solution that
                                            is pumped into a permeable uranium ore body to dissolve uranium in order
                                            that a uranium solution can be pumped from production wells.

net acres...........................        Actual acres under lease which may differ from gross acres when fractional
                                            mineral interests are not leased.

ore.................................        Naturally occurring material from which a mineral or minerals of economic
                                            value can be extracted at a reasonable profit.

over feeding........................        Operating enrichment plants in a manner that reduces plant operating costs
                                            but increases the amount of uranium required to produce a given quantity of
                                            enriched uranium.

probable reserves...................        Reserves for which quantity and grade and/or quality are computed from
                                            information similar to that used for proven (measured) reserves, but the
                                            sites for inspection, sampling, and measurement are farther apart or are
                                            otherwise less adequately spaced. The degree of assurance, although lower
                                            than that for proven (measured) reserves, is high enough to assume
                                            continuity between points of observation.





                                       22
   25

                                         
proven reserves.....................        Reserves for which (a) quantity is computed from dimensions revealed in
                                            outcrops, trenches, workings or drill holes; grade and/or quality are
                                            computed from the results of detailed sampling and (b) the sites for
                                            inspection, sampling and measurement are spaced so closely and the geologic
                                            character is so well defined that size, shape, depth and mineral content of
                                            reserves are well-established.

reclamation.........................        Reclamation involves the returning of the surface area of the mining and
                                            wellfield operating areas to a condition similar to pre-mining.

recoverable reserves................        Reserves that are either proven or probable, are physically minable, and can
                                            be profitably recovered under conditions specified at the time of the
                                            appraisal, based on a positive feasibility study. The calculation of minable
                                            reserves is adjusted for potential mining recovery and dilution.

reserve.............................        That part of a mineral deposit which could be economically and legally
                                            extracted or produced at the time of the reserve determination.

restoration.........................        Restoration involves returning an aquifer to a condition consistent with its
                                            pre-mining use and removing evidences of surface disturbance. The
                                            restoration of the wellfield can be accomplished by flushing the ore zone
                                            with native ground water and/or using reverse osmosis to remove ions to
                                            provide clean water for reinjection to flush the ore zone.

resources...........................        A resource is a concentration of naturally occurring minerals in such a form
                                            that economic extraction is potentially feasible.

roll front..........................        The configuration of sedimentary uranium ore bodies as they appear within
                                            the host sand. A term that depicts an elongate uranium ore mass that is "C"
                                            shaped.

spot price..........................        The price at which uranium may be purchased for delivery within one year.

surety obligations..................        A bond, letter of credit, or financial guarantee posted by a party in favor
                                            of a beneficiary to ensure the performance of its or another party's
                                            obligations, e.g., reclamation bonds, workers' compensation bond, or
                                            guarantees of debt instruments.

tailings............................        Waste material from a mineral processing mill after the metals and minerals
                                            of a commercial nature have been extracted; or that portion of the ore which
                                            remains after the valuable minerals have been extracted.

Trade Tech..........................        A Denver-based publisher of information for the nuclear fuel industry; the
                                            successor to the information services business of Nuexco.





                                       23
   26

                                         
uranium or uranium
concentrates........................        U(3)O(8), or triuranium octoxide.

U(3)O(8)............................        Triuranium octoxide equivalent contained in uranium concentrates, referred
                                            to as uranium concentrate.

waste...............................        Barren rock in a mine, or mineralized material that is too low in grade to
                                            be mined and milled at a profit.





                                       24
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                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

         Prior to March 24, 1999 the Company's Common Stock was traded on NASDAQ
under the trading symbol URIX. On March 23, 1999, the Company's common stock was
delisted from the NASDAQ National Market. Effective March 24, 1999, the
Company's common stock began being quoted on the OTC Bulletin Board. Beginning
with trading on October 16, 2000 the Company's trading symbol on the OTCBB was
changed to URIXE and its common stock traded on the OTCBB under this symbol
through November 13, 2000. On November 14, 2000 the Company became ineligible
for trading on the OTC Bulletin Board. The company's non-compliance resulted
from the filing of its Annual Report on Form 10-K for 1999 with unaudited
financial statements. Beginning with trading on November 14, 2000, the Company's
common stock has traded on the Pink Sheets.

         The following table sets forth the high and low sales prices for the
Common Stock as reported on the applicable markets for the periods indicated:




                                            Common Stock
                                        ---------------------
Fiscal Quarter Ending                   High             Low
- ---------------------                   ----             ---
                                                   
December 31, 2000                        1/8             2/64
September 30, 2000                      9/64             5/64
June 30, 2000                           3/16             3/32
March 31, 2000                         14/32             7/64
December 31, 1999                      13/64             7/64
September 30, 1999                      9/32             5/32
June 30, 1999                          27/64             5/32
March 31, 1999                           1/2              1/8


         The high and low sales prices for the common stock for the period
January 1, 2001 to April 10, 2001, was $0.25 and $0.04 respectively.


RECENT SALES OF UNREGISTERED SECURITIES

         In August 2000, the Company raised $750,000 of equity by the issuance
of 7.5 million shares of Common Stock at $0.10 per share to a group of private
investors. The investors were also issued five-year warrants to purchase an
aggregate of 5,625,000 shares of Common Stock with an initial exercise price of
$0.20 per share. These exercise price of the warrants have been adjusted to
$0.14 per share in accordance to the terms of the warrant as a result of the
equity transaction completed in April 2001.

         On January 31, 2001 the Company obtained a $250,000 loan by issuing
demand notes to private investors. Principal on the notes was due upon demand by
the noteholders, and interest was due and payable on the first day of every May,
August, November and February at the rate of 11% per annum. Holders of the notes
had the right, but not the obligation, to purchase Common Stock or other equity
securities offered by the Company in any subsequent private placements by paying
for such purchase by forgiving unpaid interest and/or principal due and unpaid
on the notes at $0.08 per share. The $250,000 in



                                       25
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principal under the demand notes was converted on April 11, 2001 into 3,125,000
shares of common stock of the Company in connection with an equity transaction
which raised an additional $1.835 million capital. Interest on the demand notes
of approximately $5,400 was paid in cash at the closing of the equity
transaction.

         In April 2001, the Company raised an additional $1,835,000 of equity by
the issuance of 26,062,500 million shares of Common Stock at $0.08 per share to
a group of private investors pursuant to a Common Stock Purchase Agreement.
Included in the issuance was the conversion of the $250,000 loan entered into on
January 30, 2001 with the holders of the demand notes. Under that Agreement the
Company will file a Registration Statement with the Securities and Exchange
Commission registering for resale the shares issued pursuant to the Stock
Purchase Agreement and the shares issued and issuable upon the exercise of
warrants issued in the August 2000 private placement within 60 days of the
closing date of the private placement.

HOLDERS

         As of April 12, 2001, the Company had 48,992,278 shares of Common Stock
outstanding held of record by 156 persons.

DIVIDENDS

         The Company did not declare or pay any cash or other dividends on its
Common Stock during the years ending December 31, 2000, 1999, or 1998. The
Company does not anticipate paying dividends for the foreseeable future.



                                       26
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ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         To be filed upon completion of the December 31, 2000 year-end audit on
Form 10-KSB/A.

ITEM 7. FINANCIAL STATEMENTS

         The information called for by Item 7 to be filed upon completion of the
December 31, 2000 year-end audit on Form 10-KSB/A.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

         As previously reported on Form 8-K dated February 16, 2001, on February
9, 2001 the Board of Directors of the Company recommended and approved the
replacement of its principal accountants, Arthur Andersen LLP with the firm of
Hein + Associates LLP, independent auditors. Hein + Associates LLP have been
engaged to perform the audit of the Company's financial statements for the two
years ended December 31, 1999 and 2000.



                                       27
   30

                                    PART III


ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS: COMPLIANCE
        WITH SECTION 16(a) OF THE EXCHANGE ACT

DIRECTORS

         The Board of Directors of the Company consists of the three individuals
shown below. Directors hold office until the next annual meeting of stockholders
and until their successors are elected and qualified. Directors are elected by
plurality vote.

         The following table sets forth certain information concerning the
individuals nominated for election as directors of the Company:



                                                                          Positions and Offices
                          Name                        Age                    with the Company
                          ----                        ---                 ---------------------
                                                              
                    Paul K. Willmott                  61            Chairman, Chief Executive Officer,
                                                                          President and Director

                    Leland O. Erdahl                  72                         Director

                   George R. Ireland                  44                         Director



NOMINEES FOR DIRECTOR

         PAUL K. WILLMOTT has served as a director of the Company since August
1994, as President of the Company since February 1995 and as Chairman of the
Board and Chief Executive Officer since July 31, 1995. Mr. Willmott served as
the Company's Chief Financial Officer from April 12, 1995 to September 25, 1995.
Mr. Willmott retired from Union Carbide Corporation ("Union Carbide") where he
was involved for 25 years in the finance and operation of Union Carbide's
world-wide mining and metals business. Most recently, Mr. Willmott was President
of UMETCO Minerals Corporation, a wholly-owned subsidiary of Union Carbide, from
1987 to 1991, where he was responsible for Union Carbide's uranium and vanadium
businesses. From January 1993 until February 1995, Mr. Willmott was engaged by
the Concord Mining Unit as a senior vice president where he was primarily
involved in the acquisition of UMETCO Minerals Corporation's uranium and
vanadium operating assets. Mr. Willmott graduated from Michigan Technological
University with a Bachelor of Science degree in Mining in 1964 and a Bachelor of
Science Degree in Engineering Administration in 1967. He has been an active
member of the American Institute of Mining Engineers, the Canadian Institute of
Mining Engineers and a number of state professional organizations.

         LELAND O. ERDAHL has served as a director of the Company since July 11,
1994. From 1986 to 1991, Mr. Erdahl served as President and Chief Executive
Officer for Stolar, Inc., a high-tech company involved in the radio wave imaging
of geologic media and underground radio transmission for voice and data. He was
also President and CEO of Albuquerque Uranium Corporation, a uranium mining
company, from 1987 to 1991. He is a Certified Public Accountant and is a
graduate from the College of Santa Fe. He is currently a director of Hecla
Mining Company, Canyon Resources Corporation and a trustee for a group of John
Hancock Mutual Funds. Mr. Erdahl also serves on the compensation committee of
Hecla Mining Company and Canyon Resources Corporation.

         GEORGE R. IRELAND has served as a director since May 25, 1995. Mr.
Ireland is a General Partner in Ring Partners, LLC, a private investment
partnership. From February 1991 to February 2000, Mr.



                                       28
   31

Ireland was a financial analyst for and a partner in Knott Partners L.P., a
private investment partnership. Mr. Ireland specialized in investing in
securities of natural resource and other basic industrial companies, both
domestically and abroad. From 1987 to 1991, he was a Vice President of Fulcrum
Management, Inc., which was the manager of the VenturesTrident Limited
Partnerships, (venture capital funds dedicated to investing in the mining
industry), and Senior Vice President and Chief Financial Officer of MinVen Gold
Corporation, a company in which the VenturesTrident funds had a significant
investment. Mr. Ireland graduated from the University of Michigan with degrees
in Geology and Resource Economics. He also attended the Graduate School of
Business Administration of New York University. Mr. Ireland is a director of
Merrill & Ring, Inc., a private land and timber holding company in the state of
Washington. Mr. Ireland acted as a consultant to Ryback Management Corporation
and performed due diligence on the Company in connection with Ryback's loan of
$6 million to the Company on behalf of members of the Lindner Group in 1995. Mr.
Ireland is not otherwise affiliated with the Lindner Group or Ryback.

ARRANGEMENTS REGARDING ELECTION OF DIRECTORS

         In 1995, George R. Ireland was appointed to the Board of Directors
following the closing of certain transactions with the Lindner Group. In
connection with these transactions, the Company has agreed to nominate two
individuals designated by the Lindner Group for election to the Board. Mr.
Ireland was the Lindner Group's sole designee for membership to the Board. In
February 2000 the Lindner Group's agreement terminated.

OTHER EXECUTIVE OFFICERS

         The executive officers of the Company serve at the discretion of the
Board of Directors and are subject to annual appointment by the Board at its
first meeting following the Annual General Meeting of the Stockholders. The
officers of the Company hold office until their successors are appointed by the
Board of Directors. All officers of the Company are employed on a full-time
basis. There is no family relationship between any director and executive
officer of the Company.

         The following table sets forth certain information concerning executive
officers who are not also directors of the Company:



                                                                               Positions and Offices
                           Name                       Age                         with the Company
                           ----                       ---                      ---------------------
                                                           
                   Richard A. Van Horn                 54                Senior Vice President - Operations

                    Thomas H. Ehrlich                  41        Vice President, Chief Financial Officer, Secretary
                                                                                   and Treasurer

                     Mark S. Pelizza                   48        Vice President - Health, Safety and Environmental
                                                                   Affairs and President - Hydro Resources, Inc.




                                       29
   32

         The following sets forth certain information concerning the business
experience of the foregoing executive officers during the past five years.

         RICHARD A. VAN HORN joined the Company in March 1997 and assumed the
position of Senior Vice President of Operations on April 1, 1997. Previously, he
spent three years with Energy Fuels Nuclear, Inc. as General Manager - Colorado
Plateau Operations with responsibility for the daily management of and planning
for Energy Fuels Nuclear, Inc. mining activities on the Colorado Plateau. Prior
to his work at Energy Fuels Nuclear, Inc., Mr. Van Horn spent eighteen years
with Union Carbide Corporation where he was involved with the finance and
operation of that company's worldwide mining and metals business. From 1990 to
1994, Mr. Van Horn was Director of Operations of UMETCO Minerals Corporation, a
wholly owned subsidiary of Union Carbide Corporation, responsible for all
operating aspects of UMETCO's uranium and vanadium business on the Colorado
Plateau prior to its sale to Energy Fuels Nuclear, Inc. Mr. Van Horn graduated
from the Colorado School of Mines with a Engineer of Mines degree in mining in
1973.

         THOMAS H. EHRLICH, a certified public accountant, rejoined the Company
in September 1995 as Vice President and Chief Financial Officer and was
appointed Secretary and Treasurer of the Company in December 1995. Immediately
prior to that, Mr. Ehrlich spent nine months as a Division Controller with
Affiliated Computer Services, Inc., an information technology services provider
in Dallas, Texas. Mr. Ehrlich originally joined the Company in November 1987 as
Controller-Public Reporting and was promoted to Controller and Chief Accounting
Officer in February 1990. In February 1993, Mr. Ehrlich assumed the additional
duties of Vice President and Secretary of the Company. Prior to joining the
Company, he spent four years with Deloitte Haskins & Sells and worked primarily
with clients that were publicly held companies. Prior to his work at Deloitte
Haskins & Sells, he spent three years in various accounting duties at Enserch
Exploration, Inc., an oil and gas company in Dallas, Texas. Mr. Ehrlich received
his B.S. B.A. degree in Accounting from Bryant College in 1981.

         MARK S. PELIZZA has served as the Company's Environmental Manager since
1980, and as such, he has been responsible for all environmental regulatory
activities. In February 1996, he was appointed Vice President - Health, Safety
and Environmental Affairs of the Company. In November 1999, he was appointed
President and a Director of Hydro Resources, Inc., a wholly owned subsidiary of
the Company. Prior to joining the Company, he was employed for two years by
Union Carbide as an Environmental Planning Engineer at Union Carbide's Palangana
solution mining plant in South Texas. Mr. Pelizza received a M.S. degree in
Engineering Geology from Colorado School of Mines in 1978 and a B.S. degree in
Geology from Fort Lewis College in 1974.



                                       30
   33

ITEM 10. EXECUTIVE COMPENSATION

         The following table sets forth certain information with respect to
annual and long-term compensation for services in all capacities for the years
ended December 31, 2000, 1999 and 1998 paid to the Company's Chief Executive
Officer and certain other executive officers of the Company.

         SUMMARY COMPENSATION TABLE



                                                          ANNUAL COMPENSATION                     LONG-TERM COMPENSATION
                                               -----------------------------------------     --------------------------------
                                                                             OTHER           SECURITIES
                                                                             ANNUAL          UNDERLYING          ALL OTHER
             NAME AND PRINCIPAL                 SALARY      BONUS        COMPENSATION(1)      OPTIONS         COMPENSATION(2)
                  POSITION           YEAR        ($)         ($)              ($)               (#)                 ($)
           -----------------------   ----       ------      -----        ---------------     ----------       ---------------
                                                                                            
           Paul K. Willmott(3)       2000      $198,799       $0            $1,152             750,000           $ 1,788
           Chairman, President and   1999      $187,859       $0            $  942                  --           $ 9,818
           Chief Executive Officer   1998      $200,701       $0            $  561              40,000           $ 1,887

           Richard A. Van Horn(4)    2000      $134,982       $0            $3,189             500,000           $ 1,686
           Senior Vice President -   1999      $115,283       $0            $  863                  --           $11,036
           Operations                1998      $132,749       $0            $1,960              25,000           $ 1,200

           Mark S. Pelizza           2000      $104,924       $0            $5,636             500,000           $ 1,533
           Vice President - Health,  1999      $ 95,384       $0            $7,456                  --           $ 6,166
           Safety and                1998      $107,634       $0            $6,386               9,000           $ 1,010
           Environmental Affairs

           Thomas H. Ehrlich(5)      2000      $105,237       $0            $  100             500,000           $ 1,358
           Vice President and        1999      $ 94,069       $0            $  200                  --           $ 7,309
           Chief Financial           1998      $107,260       $0            $  297              12,000           $ 1,050
           Officer




- ----------
1 Represents amount paid for out-of-pocket medical and dental expenses under the
Company's Supplemental Health Care Plan.

2 Represents contributions made by the Company under the Company's 401(k) Profit
Sharing Plan (see "401(k) Profit Sharing Plan" below) and compensation in shares
of the Company's Common Stock under the 1999 Deferred Compensation Plan (See
"Deferred Compensation Plans" below). The shares issued under the 1999 Deferred
Compensation Plan were valued at $0.375 per share, which exceeded the fair
market value of such shares when issued.

3 Salary for 2000 and 1999 includes $90,000 and $99,904, respectively which was
deferred under the Company's 1999 Deferred Compensation Plan and 2000-2001
Deferred Compensation Plan.

4 Salary for 2000 includes $20,800 that was deferred under the Company's
2000-2001 Deferred Compensation Plan.

5 Salary for 2000 and 1999 includes $17,140 and $6,163, respectively which was
deferred under the Company's 1999 Deferred Compensation Plan and 2000-2001
Deferred Compensation Plan.



                                       31

   34

SUPPLEMENTAL HEALTH CARE PLAN

         The Company has adopted a health care plan (the "Supplemental Plan")
for the officers of the Company and certain of the employees of the Company who
are also stockholders, which supplements the standard health care plan available
to all eligible employees of the Company (the "Standard Plan"). The Supplemental
Plan pays directly to the participant 80% of all out-of-pocket medical and
dental expenses not covered under the Standard Plan, including deductibles and
co-insurance amounts. Additionally, the Supplemental Plan provides to each
participant $100,000 of accidental death and dismemberment insurance protection
and a world wide medical assistance benefit. Each participant in the
Supplemental Plan may receive a maximum annual benefit of $50,000 or $100,000,
at the Company's option. The Company pays an annual premium under the
Supplemental Plan equal to $250 per participant plus 10% of claims paid. There
are currently three officers and employees covered by the Supplemental Plan.


401(k) PROFIT SHARING PLAN

         The Company maintains a defined contribution profit sharing plan for
employees of the Company (the "401(k)") that is administered by a committee of
trustees appointed by the Company. All Company employees are eligible to
participate upon the completion of six months of employment, subject to minimum
age requirements. Each year the Company makes a contribution to the 401(k) out
of its current or accumulated net profits (as defined) in an amount determined
by the Board of Directors but not exceeding 15% of the total compensation paid
or accrued to participants during such fiscal year. The Company's contributions
are allocated to participants in amounts equal to 25% (or a higher percentage,
determined at the Company's discretion) of the participants' contributions, up
to 4% of each participant's gross pay. For the plan year ended July 31, 2000,
the Company contributed amounts equal to 25% of the participant's contributions,
up to 4% of gross pay. For the plan years ended July 31, 1999 and July 31, 1998,
the Company contributed amounts equal to 25% of the participant's contributions,
up to 4% of gross pay. Participants become 20% vested in their Company
contribution account for each year of service until full vesting occurs upon the
completion of five years of service. Distributions are made upon retirement,
death or disability in a lump sum or in installments.

EMPLOYEES' STOCK OPTION PLANS

         On December 19, 1995 the Company's stockholders approved the 1995 Stock
Incentive Plan (the "1995 Plan") for key employees of the Company. The 1995 Plan
initially authorized grants of incentive stock options and non-qualified options
to purchase up to an aggregate of 750,000 shares of Common Stock. In 1998 the
Company adopted an amendment to the 1995 Plan which increased the number of
shares of Common Stock authorized to be issued to 1,250,000 shares. In March
2001 the stockholders approved an amendment to the 1995 Plan which increased the
number of shares of Common Stock authorized to be issued to 4,000,000. The Stock
Option Committee of the Board of Directors is responsible for the administration
of the 1995 Plan and has the full authority, subject to the provisions of the
1995 Plan, to determine to whom and when to grant options and the number of
shares of Common Stock covered by each grant.

         As of February 28, 2001, a total of 3,079,145 shares are reserved for
issuance upon exercise of currently outstanding options granted under the 1995
Plan. As of that date 920,855 shares were reserved for issuance pursuant to
options that may be granted in the future under the 1995 Plan. No shares have
been issued upon the exercise of options under the 1995 Plan.

         The Company also maintains an Employee's Stock Option Plan under which
the Company may grant non-qualified options. As of February 28, 2001, a total of
268,137 shares are reserved for issuance under options outstanding under that
plan.



                                       32
   35

DEFERRED COMPENSATION PLANS

         Under the Company 1999 Deferred Compensation Plan (the "1999 Plan")
executive officers and directors of the Company and its subsidiaries were
permitted to defer until January 11, 2006 up to 100% of their 1999 salary. At
the time of the deferral election, a participant could elect to receive payment
of up to 100% of the deferred amount of salary in shares of the Company's Common
Stock. A total of $231,844 was deferred under the 1999 Plan of which $50,116 was
paid by issuing 302,939 shares of the Company's Common Stock at $0.375 per
share.

         The Company also has a 2000-2001 Deferred Compensation Plan (the
"2000-2001 Plan"). Under that plan executive officers and directors of the
Company and its subsidiaries were permitted to defer up to 100% of their 2000
and 2001 salary with payment thereof to be made on January 11, 2006. On or
before that date, the participant may elect to receive the deferred amount in
shares of the Company's Common Stock valued at $0.20 per share. At January 31,
2001, a total of $171,813 has been deferred under that plan and no elections
have yet been made to convert any such amounts into shares.

OPTION GRANTS IN LAST FISCAL YEAR

         The following table sets forth certain information with respect to
options granted to the executive officers named in the Summary Compensation
Table in the fiscal year ended December 31, 2000.



                                                                                                   POTENTIAL REALIZABLE
                                                                                                     VALUE AT ASSUMED
                                                                                                   ANNUAL RATES OF STOCK
                                                                                                    PRICE APPRECIATION
                                                      INDIVIDUAL GRANTS                               FOR OPTION TERM
                             -------------------------------------------------------------------   ---------------------
                                                PERCENT OF
                                NUMBER OF      TOTAL OPTIONS
                               SECURITIES       GRANTED TO       EXERCISE OF
                               UNDERLYING      EMPLOYEES IN      BASE PRICE
  NAME                       OPTIONS GRANTED    FISCAL YEAR       ($/SHARE)     EXPIRATION DATE     5%($)       10% ($)
  ----                       ---------------   -------------     -----------    ---------------    ------       -------
                                                                                              
  Paul K. Willmott           750,000               33.3%            $0.20         09/27/2010       $94,334      $239,061

  Richard A. Van Horn        500,000               22.2%            $0.20         09/27/2010       $62,889      $159,374

  Mark S. Pelizza            500,000               22.2%            $0.20         09/27/2010       $62,889      $159,374

  Thomas H. Ehrlich          500,000               22.2%            $0.20         09/27/2010       $62,889      $159,374




                                       33
   36

AGGREGATED STOCK OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES

         The following sets forth information with respect to each exercise of
stock options during the fiscal year ended December 31, 2000 and the year-end
value of unexercised options held by each of the executive officers named in the
Summary Compensation Table.



                                                                        NUMBER OF
                                                                        SECURITIES             VALUE OF
                                                                        UNDERLYING            UNEXERCISED
                                      SHARES                            UNEXERCISED          IN-THE-MONEY
                                    ACQUIRED ON     VALUE REALIZED   OPTIONS AT FISCAL     OPTIONS AT FISCAL
              NAME                  EXERCISE (#)         ($)           YEAR END (#)           YEAR END ($)
              ----                  ------------    --------------   -----------------     -----------------
                                                                        EXERCISABLE/          EXERCISABLE/
                                                                       UNEXERCISABLE         UNEXERCISABLE
                                                                     -----------------     -----------------
                                                                               
Paul K. Willmott(1)                      --              --              100,000/0               **
                                                                         100,000/0               **
                                                                         40,200/0                **
                                                                         37,670/0                **
                                                                       19,710/6,570              **
                                                                       20,000/20,000             **
                                                                         0/750,000               **
                                                                         19,000/0                **
                                                                          1,000/0                **

Richard A. Van Horn(2)                   --              --            41,250/13,750             **
                                                                       12,500/12,500             **
                                                                         0/500,000               **

Mark S. Pelizza(3)                       --              --              14,437/0                **
                                                                          9,360/0                **
                                                                        5,775/1,925              **
                                                                        4,500/4,500              **
                                                                         0/500,000               **

Thomas H. Ehrlich(4)                     --              --              35,000/0                **
                                                                          4,260/0                **
                                                                       10,500/3,500              **
                                                                        6,000/6,000              **
                                                                         0/500,000               **


- ----------

** Represents an option whose grant price is above the December 31, 2000 closing
price on the Pink Sheets.

1 Based on the closing price on the Pink Sheets on December 31, 2000 ($0.05)
less the grant prices of $4.13, $8.38, $6.88, $9.75, $7.125, $2.9375, $0.20,
$4.25 and $5.88, respectively.

2 Based on the closing price on the Pink Sheets on December 31, 2000 ($0.05)
less the grant price of $5.50 $2.9375, and $0.20 respectively.

3 Based on the closing price on the Pink Sheets on December 31, 2000 ($0.05)
less the grant price of $2.94, $9.75, $7.125 $2.9375, and $0.20 respectively.

4 Based on the closing price on the Pink Sheets on December 31, 2000 ($0.05)
less the grant price of $6.94, $9.75, $7.125 $2.9375, and $0.20 respectively



                                       34
   37

DIRECTOR COMPENSATION

         Under the Company's Directors' Stock Option Plan ("Directors' Plan"),
each new non-employee director elected or appointed to the Board of Directors
for the first time is granted an option to purchase 20,000 shares of Common
Stock as of the date of such election or appointment and, upon the re-election
of a non-employee director at an annual meeting of the Company's stockholders,
such director is granted an option to purchase an additional 1,000 shares as of
the date of such election. As of December 31, 2000, a total of 71,000 shares are
reserved for issuance upon exercise of options granted under the Directors' Plan
and 50,500 shares were reserved for exercise upon the future grant of options
under the Directors' Plan.

         Mr. Erdahl holds options covering 26,000 shares under the Directors'
Plan. Mr. Ireland holds options covering 25,000 shares under the Directors'
Plan. Mr. Willmott holds options covering 20,000 shares under the Directors'
Plan.

         In addition, Messrs. Ireland and Erdahl each hold options to purchase
100,000 shares of Common Stock. Those options were not granted under the
Directors' Plan. On November 17, 1997, the expiration date of the options was
extended for three years until 2001 and the exercise price was increased by
$0.25 per share.

         Compensation for 2000 to the non-employee directors was awarded at the
rate of $3,000 per quarter plus $1,000 per meeting attended of the Board and
committees of the Board. Each director deferred a total of $16,000 in 2000 under
the 2000-2001 Plan, which represented all of their compensation for that year.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

         In August 1994, the Company formed a Compensation Committee to
determine the compensation of the executive officers and to set the guidelines
for compensation for the employees of the Company. During the fiscal year ended
December 31, 2000, the Compensation Committee was comprised of Leland O. Erdahl
and George R. Ireland . No member of the Compensation Committee has been or was
during the fiscal year ended December 31, 2000, an officer or employee of the
Company or any of the Company's subsidiaries. In addition, no member of the
Compensation Committee during the fiscal year ended December 31, 2000 had any
relationship requiring disclosure under the caption "Certain Relationships and
Related Transactions." No executive officer of the Company serves or served on
the compensation committee of another entity during the fiscal year ended
December 31, 2000 and no executive officer of the Company serves or served as a
director of another entity who has or had an executive officer serving on the
Compensation Committee of the Company.

COMPENSATION AGREEMENTS WITH KEY EXECUTIVES

         In June 1997 the Company entered into Compensation Agreements with each
of the executive officers named in the compensation table that provide that in
the event of a change in control of the Company, the executive will have certain
rights and benefits for a period of either twenty-four or thirty-six months
following such change in control. The agreements specify that the executive will
continue to receive compensation and benefits for the remainder of the
applicable period if the Company terminates the executive or if the executive
terminates his employment following the occurrence of certain actions without
the executive's consent. However, the Company is not obligated to provide such
rights and benefits to the executive if the executive was terminated for cause.



                                       35
   38

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of April 12, 2001, certain
information regarding persons known by the Company to be the beneficial owner of
more than 5% of the outstanding shares of the Company's Common Stock. Shown
separately in the second table below is information regarding the beneficial
ownership of the Company's Common Stock by (i) each director of the Company,
(ii) each of the executive officers, and (iii) all directors and executive
officers as a group.

PRINCIPAL STOCKHOLDERS



                                               AMOUNT AND NATURE OF BENEFICIAL                    PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER                    OWNERSHIP(1)                            OF CLASS(2)
- ------------------------------------           -------------------------------                  -----------
                                                                                          
Rudolf J. Mueller                                       6,787,700(3)                               13.5%
c/o The Winchester Group
153 East 53rd Street, Suite 5101
New York, NY 10022

Arnold Spellun                                          4,062,500(4)                                8.1%
529 Fifth Avenue
8th Floor
New York, NY 10017

                                                        3,987,350(5)                                8.0%
Robert M. Manning
119 Cooper Ave.
Upper Montclair, NJ 07043

William D. Witter                                       3,750,000                                   7.7%
153 East 53rd Street
New York, NY 10022


Central Bank and Trust Co.
Trustee of the John C. Mull IRA                         3,500,000(6)                                7.0%
P.O. Box 1366
Hutchinson, KS 67504-1366



- ----------
1 Each person has sole voting and investment power with respect to the shares
listed, unless otherwise indicated. Beneficial ownership includes shares over
which the indicated beneficial owner exercises voting and/or investment power.

2 The shares owned by each person, and the shares included in the total number
of shares outstanding, have been adjusted, and the percentages owned have been
computed, in accordance with Rule 13d-3(d)(1) under the Securities Exchange Act
of 1934. Shares subject to options or warrants currently exercisable or
exercisable within 60 days are deemed outstanding for computing the percentage
ownership of the person holding such options or warrants, but are not deemed
outstanding for computing the percentage ownership of any other person.

3 Includes (i) 78,300 shares owned by members of Mr. Mueller's family in which
Mr. Mueller shares voting and dispositive power, and (ii) 1,125,000 shares
obtainable at $0.20 per share pursuant to warrants that are exercisable through
August 21, 2005.

4 Includes 937,500 shares obtainable at $0.20 per share pursuant to warrants
that are exercisable through August 21, 2005.

5 Includes 618,750 shares obtainable at $0.20 per share pursuant to warrants
that are exercisable through August 21, 2005.

6 Includes 750,000 shares obtainable at $0.20 per share pursuant to warrants
that are exercisable through August 21, 2005.



                                       36
   39

DIRECTORS AND EXECUTIVE OFFICERS



                           NAME OF                     AMOUNT AND NATURE OF
                       BENEFICIAL OWNER               BENEFICIAL OWNERSHIP(1)        PERCENT OF CLASS(2)
                       ----------------               -----------------------        -------------------
                                                                               
                       Paul K. Willmott                      494,512(3)                      1.0%

                       Leland O. Erdahl                      157,323(4)                      0.3%

                       George R. Ireland                     194,073(5)                      0.4%

                      Richard A. Van Horn                    148,416(6)                      0.3%

                        Mark S. Pelizza                      320,568(7)                      0.6%

                       Thomas H. Ehrlich                     112,060(8)                      0.2%

             All executive officers and directors
                    as a group (6 persons)                 1,426,952(9)                      2.8%


- ----------

1 Each person has sole voting and investment power with respect to the shares
listed, unless otherwise indicated. Beneficial ownership includes shares over
which the indicated beneficial owner exercises voting and/or investment power.

2 The shares owned by each person, and the shares included in the total number
of shares outstanding, have been adjusted, and the percentages owned have been
computed, in accordance with Rule 13d-3(d)(1) under the Securities Exchange Act
of 1934. Shares subject to options currently exercisable or exercisable within
60 days are deemed outstanding for computing the percentage ownership of the
person holding such options, but not deemed outstanding for computing the
percentage ownership of any other person.

3 Includes 451,249 shares that may be obtained by Mr. Willmott through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 954,201 shares that may be obtained
by Mr. Willmott through the exercise of stock options exercisable more than 60
days from the date hereof.

4 Includes 124,250 shares that may be obtained by Mr. Erdahl through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 1,750 shares that may be obtained
by Mr. Erdahl through the exercise of stock options exercisable more than 60
days from the date hereof.

5 Includes 123,500 shares that may be obtained by Mr. Ireland through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 1,500 shares that may be obtained
by Mr. Ireland through the exercise of stock options exercisable more than 60
days from the date hereof.

6 Includes 95,083 shares that may be obtained by Mr. Van Horn through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 548,917 shares that may be obtained
by Mr. Van Horn through the exercise of stock options exercisable more than 60
days from the date hereof.

7 Includes 49,047 shares that may be obtained by Mr. Pelizza through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 523,850 shares that may be obtained
by Mr. Pelizza through the exercise of stock options exercisable more than 60
days from the date hereof.

8 Includes 79,660 shares that may be obtained by Mr. Ehrlich through the
exercise of stock options that are currently exercisable or will become
exercisable within 60 days. Does not include 537,800 shares that may be obtained
by Mr. Ehrlich through the exercise of stock options exercisable more than 60
days from the date hereof.

9 Includes 922,789 shares that may be obtained through the exercise of stock
options that are currently exercisable or will become exercisable within 60
days.



                                       37
   40

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

EXTENSION OF MATURITY DATE AND ADJUSTMENT OF CONVERSION PRICE OF LINDNER LOAN

         In May 1995, the Company borrowed $6,000,000 from two Lindner funds and
issued 6.5% secured convertible notes, convertible at $4.00 per share into
shares of Common Stock and maturing on May 25, 1998. In addition, the Company
issued warrants to purchase an aggregate of 1,500,000 shares of Common Stock at
an exercise price of $4.00 per share to the two Lindner Funds.

         In March 1998, the Company and the Lindner Funds extended the maturity
date of the loan to May 31, 2000, reduced the conversion price to $3.00 per
share, reduced the exercise price of the warrants to $3.00 per share and
extended expiration date of the warrants to May 31, 2000. In February 2000, the
$6,000,000 loan and accrued interest of $334,000 was converted into 2,111,478
shares of the Company's Common Stock. The warrants expired unexercised on May
31, 2000 except for warrants covering 500,000 shares, which were exercised in
1996 at $4.00 per share.



                                       38
   41

                                     PART IV


ITEM 13. EXHIBITS REPORTS ON FORM 8-K

(a) (1)  Financial Statements.

         To be filed upon completion of the December 31, 2000 year end audit on
         Form 10-KSB/A.

(a) (2)  Financial Statement Schedules.

         To be filed upon completion of the December 31, 2000 year end audit on
         Form 10-KSB/A.

(a) (3)  Exhibits.

         To be filed upon completion of the December 31, 2000 year end audit on
         Form 10-KSB/A.

(b)      Reports on Form 8-K.

         The Company filed a report on Form 8-K dated October 16, 2000 which
disclosed the Company had entered into a definitive agreement with Texas
regulatory authorities and the Company's bonding company providing access to
$2.3 million of funds to perform restoration at the Company's Kingsville Dome
and Rosita mine sites in South Texas.

         The Company also disclosed that it received notification that the
Company no longer met the eligibility rules for quotation on the OTC Bulletin
Board. The Company's non-compliance resulted from the filing of its Annual
Report Form on 10-K for 1999 with unaudited financial statements. Beginning
November 14, 2000 the Company's common stock was quoted on the "Pink Sheets".



                                       39
   42

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

Date: April 14, 2000

                  URANIUM RESOURCES, INC.

                  By: /s/ Paul K. Willmott
                     -------------------------------
                     Paul K. Willmott, President and
                     Chief Executive Officer


         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.



         Signature                                                                          Date
         ---------                                                                          ----
                                                                                     
         /s/ Paul K. Willmott                                                           April 14, 2001
         ----------------------------------------------------
         Paul K. Willmott,
         Director, President and Chief Executive Officer

         /s/ Thomas H. Ehrlich                                                          April 14, 2001
         ----------------------------------------------------
         Thomas H. Ehrlich,
         Vice President - Finance and Chief Financial Officer
         (Principal Financial and Accounting Officer)

         /s/ Leland O. Erdahl                                                           April 14, 2001
         ----------------------------------------------------
         Leland O. Erdahl, Director

         /s/ George R. Ireland                                                          April 14, 2001
         ----------------------------------------------------
         George R. Ireland, Director




                                       40