-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AdfdPYfBgV4nWUdA0z6hZWvm7eJlA2ZvRRonwbdLsOdjb2ztDV+uuHnPW6/r97Hl 9dHOKYAQWMCdPZYcjx6shA== 0000950134-01-505157.txt : 20010814 0000950134-01-505157.hdr.sgml : 20010814 ACCESSION NUMBER: 0000950134-01-505157 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010813 FILER: COMPANY DATA: COMPANY CONFORMED NAME: URANIUM RESOURCES INC /DE/ CENTRAL INDEX KEY: 0000839470 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-METALS, MINERALS (NO PETROLEUM) [5050] IRS NUMBER: 752212772 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-17171 FILM NUMBER: 1706329 BUSINESS ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 720 CITY: DALLAS STATE: TX ZIP: 75251 BUSINESS PHONE: 9723877777 MAIL ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 720 CITY: DALLAS STATE: TX ZIP: 75251 10QSB 1 d89730e10qsb.txt FORM 10QSB FOR QUARTER ENDING JUNE 30, 2001 1 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB X Quarterly report pursuant to Section 13 or 15(d) of the Securities - ----- Exchange Act of 1934 For the quarterly period ended June 30, 2001 or Transition report pursuant to Section 13 or 15(d) of the Securities - ----- Exchange Act of 1934 For the transition period from __________ to __________ Commission file number 0-17171 URANIUM RESOURCES, INC. (Exact Name of Small Business Issuer as Specified 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) (972) 219-3330 (Issuer's Telephone Number, Including Area Code) 650 S. EDMONDS LANE, SUITE 108, LEWISVILLE, TEXAS 75067 (Former Address if Changed From Last Report) 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 past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No X ----------- ------------- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Title of Each Class of Common Stock Number of Shares Outstanding ----------------------------------- -------------------------------- Common Stock, $0.001 par value 48,992,278 as of August 10, 2001 - -------------------------------------------------------------------------------- 2 URANIUM RESOURCES, INC. 2001 SECOND QUARTERLY REPORT ON FORM 10-QSB TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1. Financial Statements 3 Consolidated Balance Sheets - June 30, 2001 (Unaudited) and December 31, 2000 3 Consolidated Statements of Operations - Three and Six Months Ended June 30, 2001 and 2000 (Unaudited) 5 Consolidated Statements of Cash Flows - Six Months Ended June 30, 2001 and 2000 (Unaudited) 6 Notes to Consolidated Financial Statements - June 30, 2001 (Unaudited) 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10 PART II -- OTHER INFORMATION Item 1. Legal Proceedings 15 Item 2. Changes in Securities and Use of Proceeds 15 Item 3. Defaults Upon Senior Securities 15 Item 4. Submission of Matters to a Vote of Security Holders 15 Item 5. Other Information 15 Item 6. Exhibits and Reports on Form 8-K. 15 SIGNATURES 16 INDEX TO EXHIBITS E-1
2 3 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS JUNE 30, 2001 AND DECEMBER 31, 2000 (NOTE 1) ASSETS
June 30, December 31, ------------ ------------ 2001 2000 ------------ ------------ (Unaudited) Current assets: Cash and cash equivalents $ 1,351,912 $ 212,523 Receivables, net 10,885 20,883 Materials and supplies inventory 67,769 69,598 Prepaid and other current assets 21,827 19,912 ------------ ------------ Total current assets 1,452,393 322,916 ------------ ------------ Property, plant and equipment, at cost: Uranium properties 99,731,394 99,532,193 Other property, plant and equipment 280,241 383,166 Less-accumulated depreciation and depletion (99,282,854) (99,141,105) ------------ ------------ Net property, plant and equipment 728,781 774,254 Long-term investment: Certificate of deposit, restricted 2,133,823 2,858,895 Other assets 4,299 4,299 ------------ ------------ $ 4,319,296 $ 3,960,364 ============ ============
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 3 4 URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS JUNE 30, 2001 AND DECEMBER 31, 2000 (NOTE 1) LIABILITIES AND SHAREHOLDERS' DEFICIT
June 30, December 31, ------------ ------------ 2001 2000 ------------ ------------ (Unaudited) Current liabilities: Accounts payable $ 60,109 $ 199,183 Notes payable -- -- Accrued interest payable -- -- Current portion of long-term debt -- 581 Current portion of restoration reserve 83,000 83,000 Other accrued liabilities 158,070 201,281 ------------ ------------ Total current liabilities 301,179 484,045 ------------ ------------ Other long-term liabilities and deferred credits 4,313,049 5,010,631 Long-term debt, less current portion 585,000 585,000 Shareholders' equity: Common stock, $0.001 par value, shares authorized: 2001 - 100,000,000 and 2000 - 35,000,000 shares issued and outstanding (net of treasury shares): 2001 - 48,992,278 and 2000 - 22,740,366 49,145 22,893 Paid-in capital 50,299,223 48,240,477 Retained earnings (accumulated deficit) (51,218,882) (50,373,264) Less: Treasury stock (152,500 shares), at cost (9,418) (9,418) ------------ ------------ Total shareholders' deficit (879,932) (2,119,312) ------------ ------------ $ 4,319,296 $ 3,960,364 ============ ============
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 4 5 URANIUM RESOURCES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (NOTE 1) (UNAUDITED)
Three Months Ended Six Months Ended June 30, June 30, ---------------------------- ---------------------------- 2001 2000 2001 2000 ------------ ------------ ------------ ------------ Revenues: Uranium sales - Produced uranium $ -- $ -- $ -- $ 121,954 Purchased uranium -- -- -- 815,148 ------------ ------------ ------------ ------------ Uranium sales 0 0 0 937,102 Other uranium revenues -- -- -- 144,793 ------------ ------------ ------------ ------------ Total revenue 0 0 0 1,081,895 Costs and expenses: Cost of uranium sales - Direct cost of purchased uranium -- 0 -- 799,850 Royalties -- 0 -- 16,626 Operating expenses 5,781 257,984 22,368 617,179 Provision for restoration and reclamation costs -- 107 -- 12,297 Depreciation and depletion 9,635 44,469 20,403 155,927 Writedown of uranium properties 82,938 80,798 199,434 274,723 ------------ ------------ ------------ ------------ Total cost of uranium sales 98,354 383,358 242,205 1,876,602 ------------ ------------ ------------ ------------ Loss from operations before corporate expenses (98,354) (383,358) (242,205) (794,707) Corporate expenses - General and administrative 266,154 363,165 618,916 814,279 Depreciation 4,595 5,989 8,898 11,556 ------------ ------------ ------------ ------------ Total corporate expenses 270,749 369,154 627,814 825,835 ------------ ------------ ------------ ------------ Loss from operations (369,103) (752,512) (870,019) (1,620,542) Other income (expense): Interest expense, net of capitalized interest (29,136) (14,643) (36,195) (53,742) Interest and other income, net 24,427 168,037 60,596 232,102 ------------ ------------ ------------ ------------ Total other income (4,709) 153,394 24,401 178,360 ------------ ------------ ------------ ------------ Loss before federal income taxes (373,812) (599,118) (845,618) (1,442,182) Federal income tax benefit: Current -- -- -- -- Deferred -- -- -- -- ------------ ------------ ------------ ------------ Net loss $ (373,812) $ (599,118) $ (845,618) $ (1,442,182) ============ ============ ============ ============ Net loss per common share and common equivalent (basic and diluted) $ (0.01) $ (0.04) $ (0.02) $ (0.10) ============ ============ ============ ============ Weighted average common shares and common equivalent shares per share data Basic 46,128,267 14,520,366 34,567,992 14,038,017 ============ ============ ============ ============ Diluted 46,128,267 14,520,366 34,567,992 14,038,017 ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these consolidated statements. 5 6 URANIUM RESOURCES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2001 AND 2000 (NOTE 1) (UNAUDITED)
June 30 ---------------------------- 2001 2000 ------------ ------------ Cash flows from operations: Net loss $ (845,618) $ (1,442,182) Reconciliation of net income to cash provided by operations- Provision for restoration and reclamation costs -- 12,297 Depreciation and depletion 29,301 167,483 Writedown of uranium properties 199,434 274,723 Credit for deferred income taxes -- -- Decrease in restoration and reclamation accrual (765,124) (86,738) Other non-cash items, net 83,661 80,625 ------------ ------------ Cash flow used in operations, before changes in operating working capital items (1,298,346) (993,792) Effect of changes in operating working capital items- Decrease in receivables 9,998 1,074,907 Decrease in inventories 1,829 47,688 (Increase) decrease in prepaid and other current assets (1,915) 911 Increase (decrease) in payables and accrued liabilities (182,285) 127,658 ------------ ------------ Net cash provided by (used in) operations (1,470,719) 257,372 ------------ ------------ Investing activities: Decrease in investments 725,072 -- (Additions to) proceeds from property, plant and equipment - Kingsville Dome (44,196) 113,445 Rosita (35,646) (36,315) Vasquez (51,041) (38,756) Churchrock (20,839) (65,633) Crownpoint (39,304) 355,096 Other property (8,355) (3,075) ------------ ------------ Net cash provided by investing activities 525,691 324,762 ------------ ------------ Financing activities: Payments and refinancings of principal (581) (578,971) Proceeds from borrowings 250,000 -- Issuance of common stock and warrants, net 1,834,998 -- ------------ ------------ Net cash provided (used in) financing activities 2,084,417 (578,971) ------------ ------------ Net increase in cash and cash equivalents 1,139,389 3,163 Cash and cash equivalents, beginning of period 212,523 493,567 ------------ ------------ Cash and cash equivalents, end of period $ 1,351,912 $ 496,730 ============ ============
The accompanying notes to financial statements are an integral part of these consolidated statements. 6 7 1. BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying statements should be read in conjunction with the audited financial statements included in the Company's 2000 Annual Report on Form 10-KA. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2001 are not necessarily indicative of the results that may be expected for the full calendar year ending December 31, 2001. 2. FUTURE OPERATIONS The financial statements of the Company have been prepared on the basis of accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. 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. The shares issued in the private placements represent approximately 69% of the outstanding Common Stock of the Company. The completion of the private placements resulted in a significant dilution of the current stockholders' equity in 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 June 30, 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. 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 mid to late 2002. 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. 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. These factors, raise substantial doubt concerning the ability of the Company to continue as a going concern. 7 8 3. DEBT/SHAREHOLDERS' EQUITY INCREASE IN AUTHORIZED SHARES 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. MARKET FOR COMMON STOCK Effective March 24, 1999, the Company's Common Stock began being quoted on the OTC Bulletin Board. 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. SETTLEMENT OF REGULATORY COUNSEL INDEBTEDNESS The Company reached a compromise in August 2000 with its regulatory counsel settling an outstanding indebtedness of approximately $566,000 for a payment of $100,000 in cash, the assignment of certain claims, the issuance of 720,000 shares of Common Stock and an agreement to issue up to an additional 200,000 shares upon the occurrence of certain events. In January 2001 the Company issued 189,000 shares of Common Stock in final settlement of this agreement. SHORT TERM DEBT 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 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. EQUITY INFUSION 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. STOCK OPTION GRANTS Employee Option Grant In February 2001, the Company granted certain key employees stock options under the Company's Employees' Stock Option Plan to acquire a total of 475,500 shares of Common Stock at $0.19 per share, the fair market value of the Company's stock on the date of the grant. One-third of the options were exercisable upon their grant with the remaining options vesting one-third in February 2002 and one-third in February 2003. The options are exercisable for a period of ten years from the date of grant. 8 9 New Director Grant On June 19, 2001, the Company appointed a new member to the Company's Board of Directors. Mr. Rudolf J. Mueller was appointed as a Board Member and also as a member of the Company's Audit committee. In connection with his appointment Mr. Mueller was granted 20,000 options under the Company's Directors Stock Option Plan to purchase the Company's common stock at $0.22 per share, the fair market value of the common stock on the date of the grant. The options vest ratably over a four year period and may be exercised within ten years of the date of the grant. Directors Stock Option Grants In 1995, the Company granted options to certain directors of URI, to purchase 100,000 shares of the Company's common stock at an exercise price of $4.50 per share and 100,000 shares of the Company's common stock at an exercise price of $8.38 per share. All such options were immediately exercisable and were originally scheduled to expire in 1998. In 1997, the term of these options was revised for three years and the exercise price was increased by $0.25 per share. All of these options expired unexercised in May 2001. On June 19, 2001, the Company granted options to each of the three non-employee directors of URI, to purchase 100,000 shares of the Company's common stock at an exercise price of $0.22 per share, the fair market value of a share of common stock on the date of grant. Such options are immediately exercisable and may be exercised within ten years of the date of the grant. CAPITALIZED INTEREST Interest capitalized in the six months ended June 30, 2001 and 2000 was $0 and $61,000, respectively. Total interest costs in these periods were $36,000 and $115,000, respectively. 9 10 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward Looking Statements This Item 2 contains "forward-looking statements" which 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 liquidity, financing of operations, continued volatility of uranium prices, estimates of future capital expenditures, proved undeveloped reserves and other such matters. The words "believes," "expects," "projects," "targets," or "estimates" 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" in the Company's 2000 Annual Report on Form 10-KA. GOING CONCERN/UNCERTAIN FUTURE OPERATIONS The Company ceased production activities in 1999 at both of its two producing properties because of depressed uranium prices. 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. In August, 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 5,475,000 shares of Common Stock at an exercise price of $0.14 per share. In October 2000, the Company signed an agreement with Texas regulatory authorities and the Company's bonding company (the "Restoration Agreement") that provides the Company access to up to $2.2 million of Company funds pledged to secure the Company's restoration bonds. The funds are being used by the Company to perform restoration at the Company's Kingsville Dome and Rosita mine sites in South Texas. On January 31, 2001 the Company obtained a $250,000 loan by issuing demand notes to private investors. The $250,000 in 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. 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. Assuming that the Company is able to continue funding its restoration of the Kingsville Dome and Rosita mine sites through extensions to the Restoration Agreement, the Company estimates it will have the funds to remain operating into approximately mid to late 2002. 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. 10 11 CAPITAL RESOURCES AND LIQUIDITY Operating Cash Flows and Liquidity For the quarter ended June 30, 2001, the Company's cash and cash equivalents of $1,352,000 represented an increase of $979,000 for the quarter. This compares to a decrease of $349,000 for the second quarter of 2000. The Company's cash flow used in operations was $1,131,000 for the quarter ended June 30, 2001, in comparison to cash flow used in operations in the same period in 2000 of $427,000. The Company's net working capital at June 30, 2001 was $1,151,000. Investing Cash Flows Restoration Funding 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. In the six months ended June 30, 2001 approximately $725,000 has been released to the Company 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. South Texas Projects During the six months ending June 30, 2001, capitalized expenditures at the Company's South Texas locations totaled $131,000. Capital expenditures for the balance of 2001 for these properties is expected to be minimal. The Company expects to fund its 2001 activities at the Kingsville Dome, Rosita and Vasquez locations from existing cash and from cash to be received under the Restoration Agreement. New Mexico Projects Capital expenditures at the Company's Churchrock and Crownpoint projects for permitting and land holding costs totaled approximately $68,000 for the six months ending June 30, 2001. Capital expenditures for the remainder of 2001 for these properties is expected to be minimal. In March 2000, the Company received $440,000 in escrowed funds related to certain of the Company's Crownpoint Unit I properties. Financing Cash Flows On January 31, 2001 the Company obtained a $250,000 loan by issuing demand notes to private investors. The $250,000 in 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. 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. In July 1999, the Company extended its revolving credit facility through July 2000. Principal advances, outstanding under the facility totaled $575,000 at December 31, 1999 and such amount was repaid in the first quarter of 2000. At March 31, 2000, the Company had monetized all of its uranium sales contracts and uranium inventories. Without these underlying assets the Company was unable to draw on the credit facility or utilize it as a source of working capital, and terminated the agreement in the second quarter of 2000. ENVIRONMENTAL ASPECTS The Company utilizes ISL solution mining technology as its only mining method. Unlike conventional uranium mining companies, the Company's mining technology does not create "tailings". Nevertheless, the Company is highly regulated. Its primary environmental costs to date have been related to obtaining and complying with environmental mining permits and, once mining is completed, the reclamation and restoration of the surface areas and underground water quality to a condition consistent with applicable requirements. Accruals for the 11 12 estimated future cost of such activities are made on a per-pound basis as part of production costs. See the Consolidated Statements of Operations for the applicable provisions for such future costs. See also Note 1 - "Restoration and Reclamation Costs" of Notes to Consolidated Financial Statements in the Company's Form 10-KA as of December 31, 2000. 12 13 RESULTS OF OPERATIONS Revenues, earnings from operations and net income for the Company can fluctuate significantly on a quarter to quarter basis during the year because of the timing of deliveries requested by its utility customers. Accordingly, operating results for any quarter or year-to-date period are not necessarily comparable and may not be indicative of the results which may be expected for future quarters or for the entire year. Three and Six Months Ended June 30, 2001 and 2000 The following is a summary of the key operational and financial statistics related to the Results of Operations:
Three Months Ended Six Months Ended June 30, June 30, ------------------- ------------------- 2001 2000 2001 2000 -------- -------- -------- -------- (In thousands, except per pound data) Uranium sales revenue $ -- $ -- $ -- $ 937 Other uranium revenues -- -- -- 145 Total pounds delivered -- -- -- 98 Average sales price/pound N/A N/A N/A $ 9.58 Pounds purchased -- -- -- 85 Average production cost of produced pounds N/A N/A N/A (a) Average cost of purchased pounds N/A N/A N/A $ 9.41 Average cost of produced pounds sold N/A N/A N/A (a) Average cost of purchased pounds sold N/A N/A N/A $ 9.41
(a) The Company ceased uranium production operations in the first quarter of 1999 when its South Texas projects were placed on stand-by. Costs while on stand-by are expensed to operating expenses as they are incurred. A nominal amount of production has occurred while the projects have been on stand-by, the inventory resulting from such incidental production was valued at the spot market cost. The Company delivered 98,000 pounds of uranium in the first quarter of 2000, no deliveries were made in the second quarter of 2000 or in 2001. The Company does not have any remaining deliveries scheduled for the balance of 2001 or beyond. 13 14 Details of the cost of uranium sales were as follows:
Three Months Ended Six Months Ended June 30, June 30, ------------------- ------------------- 2001 2000 2001 2000 -------- -------- -------- -------- (In thousands) (In thousands) Cost of purchased uranium $ -- $ -- $ -- $ 800 Royalties -- -- -- 17 Operating expenses 5 258 22 617 Provision for restoration and reclamation costs -- -- -- 12 Depreciation and depletion of uranium properties 10 44 20 156 Writedown of uranium properties 83 81 199 275 -------- -------- -------- -------- Total cost of uranium sales $ 98 $ 383 $ 242 $ 1,877 ======== ======== ======== ========
Operating expenses in the first six months of 2001 consisted of stand-by costs in the Company's South Texas projects. Operating expenses in the first quarter of 2000 resulted from the sale of uranium inventory ($43,000) and restoration and stand-by related costs ($574,000). The provision for restoration and reclamation in the first six months ended June 30, 2001 was nil, compared to $12,000 for the same period in 2000. The depreciation and depletion provision in the six months ended June 30, 2001 was $20,000 compared to $156,000 in the first two quarters of 2000. The Company incurred royalties from production sold in the first two quarters of 2000 of $17,000. No royalty expense was incurred in 2001. Uranium purchases were made in the first quarter of 2000 at $9.41 per pound. No such purchases were made in 2001. Corporate expenses consisting of general and administrative ("G&A") expenses decreased to $627,000 in the first half of 2001 from $826,000 in the first quarter of 2000. The lower G&A costs in 2001 reflect the continued focus on reducing costs throughout all corporate levels and activities. 14 15 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS. In April 2001, Uranium Resources, Inc. (the "Company") completed a private placement of 26,062,500 shares of Common Stock of the Company at $0.08 per share, consisting of $1,835,000 in cash and the cancellation of $250,000 of debt. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None 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. ITEM 5. OTHER INFORMATION. None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits See the Index to Exhibits on Page E-1 for a listing of the exhibits that are filed as part of this Quarterly Report. (b) Reports on Form 8-K The Company filed a Current Report on Form 8-K on April 18, 2001 disclosing the completion of the private placement of 26,062,500 shares of Common Stock of the Company at $0.08 per share, consisting of $1,835,000 in cash and the cancellation of $250,000 of debt. 15 16 SIGNATURES Pursuant to the requirements 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. URANIUM RESOURCES, INC. Dated: August 13, 2001 By: /s/ Paul K. Willmott --------------------- Paul K. Willmott Director, President and Chief Executive Officer Dated: August 13, 2001 By: /s/ Thomas H. Ehrlich ---------------------- Thomas H. Ehrlich Vice President - Finance and Chief Financial Officer (Principal Financial and Accounting Officer) 16 17 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------ ----------- 3.1* Restated Certificate of Incorporation of the Company, as amended (filed with the Company's Annual Report on Form 10-K dated March 27, 1997). 3.2* Certificate Amendment to the Certificate of Incorporation dated June 22, 1999 (filed with the Company's Quarterly Report on Form 10-Q dated August 12, 1999). 3.3* Restated Bylaws of the Company (filed with the Company's Form S-3 Registration No. 333-17875 on December 16, 1996). 3.4* Certificate Amendment to the Certificate of Incorporation dated March 23, 2001 (filed with the Company's Annual Report on Form 10-K/A dated July 26, 2001). 4.1* Registration Rights Agreement dated March 25, 1997 between the Company and Santa Fe Pacific Gold Corporation (filed with the Company's Annual Report on Form 10-K dated March 27, 1997). 10.1* Amended and Restated Directors Stock Option Plan (filed with the Company's Form S-8 Registration No. 333-00349 on January 22, 1996). 10.2* Amended and Restated Employee's Stock Option Plan (filed with the Company's Form S-8 Registration No. 333-00403 on January 22, 1996). 10.3* 1995 Stock Incentive Plan (filed with the Company's Form S-8 Registration No. 333-00405 on January 22, 1996). 10.4* Non-Qualified Stock Option Agreement dated August 16, 1995, between the Company and Leland O. Erdahl (filed with the Company's Annual Report on Form 10-K dated March 27, 1996). 10.5* Non-Qualified Stock Option Agreement dated May 25, 1995, between the Company and George R. Ireland (filed with the Company's Annual Report on Form 10-K dated March 27, 1996). 10.6* Summary of Supplemental Health Care Plan (filed with Amendment No. 1 to the Company's Form S-1 Registration Statement (File No. 33-32754) as filed with the Securities and Exchange Commission on February 20, 1990). 10.7* Agreement of Santa Fe Pacific Gold Corporation as Uranco, Inc. Shareholder with the Company and Guarantee of the Company dated as of March 25, 1997 (filed with the Company's Annual Report on Form 10-K dated March 27, 1997). (1) 10.8* Stock Exchange Agreement and Plan of Reorganization dated as of March 25, 1997 (filed with the Company's Annual Report on Form 10-K dated March 27, 1997). 10.9* License to Explore and Option to Purchase dated March 21, 1997 between Santa Fe Pacific Gold Corporation and Uranco, Inc. (filed with the Company's Annual Report on Form 10-K dated March 27, 1997).(1) 10.10* Amendment #1 to Nonqualified Stock Option Agreement dated November 17, 1997 between the Company and Leland O. Erdahl (filed with the Company's Annual Report on Form 10-K dated March 27, 1998).
E-1 18
EXHIBIT NUMBER DESCRIPTION ------ ----------- 10.11* Amendment #1 to Nonqualified Stock Option Agreement dated November 17, 1997 between the Company and George R. Ireland (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.12* Compensation Agreement dated June 2, 1997 between the Company and Paul K. Willmott (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.13* Compensation Agreement dated June 2, 1997 between the Company and Richard A. Van Horn (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.14* Compensation Agreement dated June 2, 1997 between the Company and Thomas H. Ehrlich (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.15* Compensation Agreement dated June 2, 1997 between the Company and Mark S. Pelizza (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.16* Uranium Resources, Inc. 1999 Deferred Compensation Plan (filed with the Company's Annual Report on Form 10-K dated March 31, 1999). 10.17* Note Exchange Agreement dated June 30,1999 between the Company and Lindner Investments (filed with the Company's Quarterly Report on Form 10-Q dated August 12, 1999). 10.18* Kingsville Dome and Rosita Mines Agreement dated October 11, 2000 between the Company, the Texas Natural Resources Conservation Commission, the Texas Department of Health and the United States Fidelity & Guaranty Company (filed with the Company's Annual Report on Form 10-K/A dated July 26, 2001). 10.19* Common Stock Purchase Agreement dated February 28, 2001 between the Company and Purchasers of the Common Stock of the Company (filed with the Company's Annual Report on Form 10-K/A dated July 26, 2001). 10.20 Nonqualified Stock Option Agreement dated June 19, 2001, between the Company and Leland O. Erdahl. 10.21 Nonqualified Stock Option Agreement dated June 19, 2001, between the Company and George R. Ireland. 10.22 Nonqualified Stock Option Agreement dated June 19, 2001, between the Company and Rudolf J. Mueller.
*Incorporated by reference pursuant to Rule 12b-32 under the Securities and Exchange E-2 EX-10.20 3 d89730ex10-20.txt NONQUALIFIED STOCK OPTION AGRMNT - LELAND ERDAHL 1 EXHIBIT 10.20 NONQUALIFIED STOCK OPTION AGREEMENT THIS NONQUALIFIED STOCK OPTION AGREEMENT is entered into as of June 19, 2001 between Uranium Resources, Inc., a Delaware corporation (the "Company"), and Leland O. Erdahl, an individual (the "Optionee"). RECITALS: A. The Company desires to grant an option to Optionee to purchase shares of the Company's common stock; and B. Optionee desires to accept such option. NOW, THEREFORE, in consideration of the foregoing and the mutual promises set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Grant of Option. The Company hereby grants to Optionee an irrevocable option to purchase up to 100,000 shares of the Common Stock of the Company (the "Shares") at a price of $0.22 per share. 2. Term of Option. This option shall expire, terminate, and be of no further force and effect upon the earliest to occur of the following (the "Expiration Date"): (a) at 5:00 p.m., Central Time, on June 18, 2011; (b) on the thirtieth day after the Optionee ceases to be a director of the Company, if the Optionee ceases to be a director of the Company for any reason other than removal for cause or death; (c) if the Optionee is removed as a director for cause, at the time of such removal; or (d) if the Optionee dies before this option otherwise expires, this option shall be exercisable for a period of one year after the date of death by the Optionee's heirs or legal representatives to the same extent it was exercisable by the Optionee on the date of death. 3. Exercise of Option. This option shall be exercised at any time prior to the Expiration Date by delivery of written notice to the Company setting forth the number of Shares with respect to which this option is being exercised and the address to which the certificates representing the Shares shall be mailed. In order to be effective, such written notice shall be accompanied at the time of its delivery to the Company by payment by certified check or by bank cashier's check payable to the Company of the option price of such Shares. In addition, the Optionee hereby agrees to pay to the Company at the time such written notice of exercise is delivered to the Company any federal, state, or local taxes which the Company deems necessary or appropriate to be withheld in connection with the exercise of the option granted hereunder. As promptly as practicable after the receipt by the Company of the foregoing, the Company shall cause to be delivered to the Optionee a certificate or certificates representing the number of Shares with respect to which this option has been so exercised. 1 2 4. Reserved Shares. The Company has duly reserved for issuance a number of authorized but unissued shares adequate to fulfill its obligations under this agreement. During the term of this agreement the Company shall take such action as may be necessary to maintain at all times an adequate number of shares reserved for issuance or treasury shares to fulfill its obligations hereunder. 5. Assignment or Transfer. This option may not be assigned or transferred without the prior written consent of the Company. 6. Compliance with Law. This option shall not be exercised, and no Shares shall be issued in respect hereof, unless (a) in compliance with federal and applicable state securities or other laws and (b) the Company obtains any approval or other clearance from any federal or state governmental agency which the Company in its sole discretion shall determine to be necessary or advisable. Any determination in this connection by the Company shall be final, binding, and conclusive on all parties. 7. Legends and Representations. (a) The certificates evidencing Shares purchased pursuant to this option shall bear the following legends: THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS, THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. (b) Upon delivery of the Notice specified in Section 3 above and as a condition to the exercise of this option, Optionee shall be deemed to have made the following representations to the Company: (1) Investment Intent; Capacity to Protect Interests. Optionee is receiving the Shares solely for Optionee's own account for investment and not with a view to or for sale in connection with any distribution and not with any present intention of selling, offering to sell or otherwise disposing of or distributing thereof in any transaction other than a transaction exempt from registration under the Securities Act of 1933, as amended (the "Act"). Optionee is experienced in evaluating and investing in companies such as the Company. (2) Information Concerning the Company. Optionee has received all such information as Optionee has deemed necessary and appropriate to evaluate an investment in the Shares, and Optionee has received satisfactory and complete information concerning the business and financial condition of the Company in response to all inquiries in respect thereof. (3) Restricted Securities. Optionee understands and acknowledges that: 2 3 (a) The Shares have not been registered under the Act, and the Shares must be held indefinitely unless subsequently registered under the Act or an exemption from such registration is available and the Company is under no obligation to register the Shares; (b) the share certificate representing the Shares will be stamped with legends specified in Section 7(a) hereof; and (c) the Company will make a notation in its records of the aforementioned restrictions on transfer and legends. (4) Further Limitations on Disposition. Without in any way limiting his representations set forth above, Optionee further agrees that he shall in no event make any disposition of all or any portion of the Shares unless and until: (a) there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or (b)(1) Optionee shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, (2) Optionee shall have furnished the Company with an opinion of Optionee's counsel to the effect that such disposition will not require registration of such Shares under the Act, and (3) such opinion of Optionee's counsel shall have been concurred in by counsel for the Company and the Company shall have advised Optionee of such concurrence. 8. Notice. All notices or other communications desired to be given hereunder shall be in writing and shall be deemed to have been duly given upon receipt, if personally delivered, or on the third business day following mailing by United States first class mail, postage prepaid, and addressed as follows: If to the Company: Paul Willmott, President Uranium Resources, Inc. 650 South Edmonds, Suite 108 Lewisville, TX 75067 If to Optionee: Leland O. Erdahl or to such other address as either party shall give to the other in the manner set forth above. 9. Tax Treatment. Optionee acknowledges that the tax treatment of this option, Shares subject to this option or any events or transactions with respect thereto may be dependent upon various factors or events which are not determined by this Agreement. The Company makes no representations with respect to and hereby disclaims all responsibility as to such tax treatment. 10. Nonqualified Status. This option is not intended to be an "Incentive Stock Option" as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and it shall not be treated as an Incentive Stock Option, whether or not, by its terms, it meets the requirements of Section 422. 11. Adjustments. The number of shares of Common Stock covered by the Option, as well as the price per share of Common Stock covered by the Option, shall be proportionately adjusted for any increase or decrease in the number of issued and outstanding shares of Common Stock resulting from a stock split, reverse stock split, stock 3 4 dividend, combination or reclassification of the Common Stock of the Company. Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. In the event of the proposed merger or consolidation of the Company or dissolution or liquidation of the Company, the Board shall notify the Optionee at least fifteen (15) days prior to such proposed action. To the extent it has not been previously exercised, the option will terminate immediately prior to the consummation of such proposed action. IN WITNESS WHEREOF, the Company and Optionee have executed this Stock Option Agreement effective as of the date first set forth above. URANIUM RESOURCES, INC. By: -------------------------------------- Paul K. Willmott, President ----------------------------------------- Leland O. Erdahl 4 EX-10.21 4 d89730ex10-21.txt NONQUALIFIED STOCK OPTION AGMNT - GEORGE IRELAND 1 EXHIBIT 10.21 NONQUALIFIED STOCK OPTION AGREEMENT THIS NONQUALIFIED STOCK OPTION AGREEMENT is entered into as of June 19, 2001 between Uranium Resources, Inc., a Delaware corporation (the "Company"), and George R. Ireland, an individual (the "Optionee"). RECITALS: A. The Company desires to grant an option to Optionee to purchase shares of the Company's common stock; and B. Optionee desires to accept such option. NOW, THEREFORE, in consideration of the foregoing and the mutual promises set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Grant of Option. The Company hereby grants to Optionee an irrevocable option to purchase up to 100,000 shares of the Common Stock of the Company (the "Shares") at a price of $0.22 per share. 2. Term of Option. This option shall expire, terminate, and be of no further force and effect upon the earliest to occur of the following (the "Expiration Date"): (a) at 5:00 p.m., Central Time, on June 18, 2011; (b) on the thirtieth day after the Optionee ceases to be a director of the Company, if the Optionee ceases to be a director of the Company for any reason other than removal for cause or death; (c) if the Optionee is removed as a director for cause, at the time of such removal; or (d) if the Optionee dies before this option otherwise expires, this option shall be exercisable for a period of one year after the date of death by the Optionee's heirs or legal representatives to the same extent it was exercisable by the Optionee on the date of death. 3. Exercise of Option. This option shall be exercised at any time prior to the Expiration Date by delivery of written notice to the Company setting forth the number of Shares with respect to which this option is being exercised and the address to which the certificates representing the Shares shall be mailed. In order to be effective, such written notice shall be accompanied at the time of its delivery to the Company by payment by certified check or by bank cashier's check payable to the Company of the option price of such Shares. In addition, the Optionee hereby agrees to pay to the Company at the time such written notice of exercise is delivered to the Company any federal, state, or local taxes which the Company deems necessary or appropriate to be withheld in connection with the exercise of the option granted hereunder. As promptly as practicable after the receipt by the Company of the foregoing, the Company shall cause to be delivered to the Optionee a certificate or certificates representing the number of Shares with respect to which this option has been so exercised. 1 2 4. Reserved Shares. The Company has duly reserved for issuance a number of authorized but unissued shares adequate to fulfill its obligations under this agreement. During the term of this agreement the Company shall take such action as may be necessary to maintain at all times an adequate number of shares reserved for issuance or treasury shares to fulfill its obligations hereunder. 5. Assignment or Transfer. This option may not be assigned or transferred without the prior written consent of the Company. 6. Compliance with Law. This option shall not be exercised, and no Shares shall be issued in respect hereof, unless (a) in compliance with federal and applicable state securities or other laws and (b) the Company obtains any approval or other clearance from any federal or state governmental agency which the Company in its sole discretion shall determine to be necessary or advisable. Any determination in this connection by the Company shall be final, binding, and conclusive on all parties. 7. Legends and Representations. (a) The certificates evidencing Shares purchased pursuant to this option shall bear the following legends: THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS, THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. (b) Upon delivery of the Notice specified in Section 3 above and as a condition to the exercise of this option, Optionee shall be deemed to have made the following representations to the Company: (1) Investment Intent; Capacity to Protect Interests. Optionee is receiving the Shares solely for Optionee's own account for investment and not with a view to or for sale in connection with any distribution and not with any present intention of selling, offering to sell or otherwise disposing of or distributing thereof in any transaction other than a transaction exempt from registration under the Securities Act of 1933, as amended (the "Act"). Optionee is experienced in evaluating and investing in companies such as the Company. (2) Information Concerning the Company. Optionee has received all such information as Optionee has deemed necessary and appropriate to evaluate an investment in the Shares, and Optionee has received satisfactory and complete information concerning the business and financial condition of the Company in response to all inquiries in respect thereof. (3) Restricted Securities. Optionee understands and acknowledges that: 2 3 (a) The Shares have not been registered under the Act, and the Shares must be held indefinitely unless subsequently registered under the Act or an exemption from such registration is available and the Company is under no obligation to register the Shares; (b) the share certificate representing the Shares will be stamped with legends specified in Section 7(a) hereof; and (c) the Company will make a notation in its records of the aforementioned restrictions on transfer and legends. (4) Further Limitations on Disposition. Without in any way limiting his representations set forth above, Optionee further agrees that he shall in no event make any disposition of all or any portion of the Shares unless and until: (a) there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or (b)(1) Optionee shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, (2) Optionee shall have furnished the Company with an opinion of Optionee's counsel to the effect that such disposition will not require registration of such Shares under the Act, and (3) such opinion of Optionee's counsel shall have been concurred in by counsel for the Company and the Company shall have advised Optionee of such concurrence. 8. Notice. All notices or other communications desired to be given hereunder shall be in writing and shall be deemed to have been duly given upon receipt, if personally delivered, or on the third business day following mailing by United States first class mail, postage prepaid, and addressed as follows: If to the Company: Paul Willmott, President Uranium Resources, Inc. 650 South Edmonds, Suite 108 Lewisville, TX 75067 If to Optionee: George R. Ireland or to such other address as either party shall give to the other in the manner set forth above. 9. Tax Treatment. Optionee acknowledges that the tax treatment of this option, Shares subject to this option or any events or transactions with respect thereto may be dependent upon various factors or events which are not determined by this Agreement. The Company makes no representations with respect to and hereby disclaims all responsibility as to such tax treatment. 10. Nonqualified Status. This option is not intended to be an "Incentive Stock Option" as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and it shall not be treated as an Incentive Stock Option, whether or not, by its terms, it meets the requirements of Section 422. 11. Adjustments. The number of shares of Common Stock covered by the Option, as well as the price per share of Common Stock covered by the Option, shall be proportionately adjusted for any increase or decrease in the number of issued and outstanding shares of Common Stock resulting from a stock split, reverse stock split, stock 3 4 dividend, combination or reclassification of the Common Stock of the Company. Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. In the event of the proposed merger or consolidation of the Company or dissolution or liquidation of the Company, the Board shall notify the Optionee at least fifteen (15) days prior to such proposed action. To the extent it has not been previously exercised, the option will terminate immediately prior to the consummation of such proposed action. IN WITNESS WHEREOF, the Company and Optionee have executed this Stock Option Agreement effective as of the date first set forth above. URANIUM RESOURCES, INC. By: -------------------------------------- Paul K. Willmott, President ----------------------------------------- George R. Ireland 4 EX-10.22 5 d89730ex10-22.txt NONQUALIFIED STOCK OPTION AGMNT - RUDOLPH MUELLER 1 EXHIBIT 10.22 NONQUALIFIED STOCK OPTION AGREEMENT THIS NONQUALIFIED STOCK OPTION AGREEMENT is entered into as of June 19, 2001 between Uranium Resources, Inc., a Delaware corporation (the "Company"), and Rudolph J. Mueller, an individual (the "Optionee"). RECITALS: A. The Company desires to grant an option to Optionee to purchase shares of the Company's common stock; and B. Optionee desires to accept such option. NOW, THEREFORE, in consideration of the foregoing and the mutual promises set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Grant of Option. The Company hereby grants to Optionee an irrevocable option to purchase up to 100,000 shares of the Common Stock of the Company (the "Shares") at a price of $0.22 per share. 2. Term of Option. This option shall expire, terminate, and be of no further force and effect upon the earliest to occur of the following (the "Expiration Date"): (a) at 5:00 p.m., Central Time, on June 18, 2011; (b) on the thirtieth day after the Optionee ceases to be a director of the Company, if the Optionee ceases to be a director of the Company for any reason other than removal for cause or death; (c) if the Optionee is removed as a director for cause, at the time of such removal; or (d) if the Optionee dies before this option otherwise expires, this option shall be exercisable for a period of one year after the date of death by the Optionee's heirs or legal representatives to the same extent it was exercisable by the Optionee on the date of death. 3. Exercise of Option. This option shall be exercised at any time prior to the Expiration Date by delivery of written notice to the Company setting forth the number of Shares with respect to which this option is being exercised and the address to which the certificates representing the Shares shall be mailed. In order to be effective, such written notice shall be accompanied at the time of its delivery to the Company by payment by certified check or by bank cashier's check payable to the Company of the option price of such Shares. In addition, the Optionee hereby agrees to pay to the Company at the time such written notice of exercise is delivered to the Company any federal, state, or local taxes which the Company deems necessary or appropriate to be withheld in connection with the exercise of the option granted hereunder. As promptly as practicable after the receipt by the Company of the foregoing, the Company shall cause to be delivered to the Optionee a certificate or certificates representing the number of Shares with respect to which this option has been so exercised. 1 2 4. Reserved Shares. The Company has duly reserved for issuance a number of authorized but unissued shares adequate to fulfill its obligations under this agreement. During the term of this agreement the Company shall take such action as may be necessary to maintain at all times an adequate number of shares reserved for issuance or treasury shares to fulfill its obligations hereunder. 5. Assignment or Transfer. This option may not be assigned or transferred without the prior written consent of the Company. 6. Compliance with Law. This option shall not be exercised, and no Shares shall be issued in respect hereof, unless (a) in compliance with federal and applicable state securities or other laws and (b) the Company obtains any approval or other clearance from any federal or state governmental agency which the Company in its sole discretion shall determine to be necessary or advisable. Any determination in this connection by the Company shall be final, binding, and conclusive on all parties. 7. Legends and Representations. (a) The certificates evidencing Shares purchased pursuant to this option shall bear the following legends: THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS, THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. (b) Upon delivery of the Notice specified in Section 3 above and as a condition to the exercise of this option, Optionee shall be deemed to have made the following representations to the Company: (1) Investment Intent; Capacity to Protect Interests. Optionee is receiving the Shares solely for Optionee's own account for investment and not with a view to or for sale in connection with any distribution and not with any present intention of selling, offering to sell or otherwise disposing of or distributing thereof in any transaction other than a transaction exempt from registration under the Securities Act of 1933, as amended (the "Act"). Optionee is experienced in evaluating and investing in companies such as the Company. (2) Information Concerning the Company. Optionee has received all such information as Optionee has deemed necessary and appropriate to evaluate an investment in the Shares, and Optionee has received satisfactory and complete information concerning the business and financial condition of the Company in response to all inquiries in respect thereof. (3) Restricted Securities. Optionee understands and acknowledges that: 2 3 (a) The Shares have not been registered under the Act, and the Shares must be held indefinitely unless subsequently registered under the Act or an exemption from such registration is available and the Company is under no obligation to register the Shares; (b) the share certificate representing the Shares will be stamped with legends specified in Section 7(a) hereof; and (c) the Company will make a notation in its records of the aforementioned restrictions on transfer and legends. (4) Further Limitations on Disposition. Without in any way limiting his representations set forth above, Optionee further agrees that he shall in no event make any disposition of all or any portion of the Shares unless and until: (a) there is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or (b)(1) Optionee shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, (2) Optionee shall have furnished the Company with an opinion of Optionee's counsel to the effect that such disposition will not require registration of such Shares under the Act, and (3) such opinion of Optionee's counsel shall have been concurred in by counsel for the Company and the Company shall have advised Optionee of such concurrence. 8. Notice. All notices or other communications desired to be given hereunder shall be in writing and shall be deemed to have been duly given upon receipt, if personally delivered, or on the third business day following mailing by United States first class mail, postage prepaid, and addressed as follows: If to the Company: Paul Willmott, President Uranium Resources, Inc. 650 South Edmonds, Suite 108 Lewisville, TX 75067 If to Optionee: Rudolph J. Mueller or to such other address as either party shall give to the other in the manner set forth above. 9. Tax Treatment. Optionee acknowledges that the tax treatment of this option, Shares subject to this option or any events or transactions with respect thereto may be dependent upon various factors or events which are not determined by this Agreement. The Company makes no representations with respect to and hereby disclaims all responsibility as to such tax treatment. 10. Nonqualified Status. This option is not intended to be an "Incentive Stock Option" as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and it shall not be treated as an Incentive Stock Option, whether or not, by its terms, it meets the requirements of Section 422. 11. Adjustments. The number of shares of Common Stock covered by the Option, as well as the price per share of Common Stock covered by the Option, shall be proportionately adjusted for any increase or decrease in the number of issued and outstanding shares of Common Stock resulting from a stock split, reverse stock split, stock 3 4 dividend, combination or reclassification of the Common Stock of the Company. Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. In the event of the proposed merger or consolidation of the Company or dissolution or liquidation of the Company, the Board shall notify the Optionee at least fifteen (15) days prior to such proposed action. To the extent it has not been previously exercised, the option will terminate immediately prior to the consummation of such proposed action. IN WITNESS WHEREOF, the Company and Optionee have executed this Stock Option Agreement effective as of the date first set forth above. URANIUM RESOURCES, INC. By: -------------------------------------- Paul K. Willmott, President ----------------------------------------- Rudolph J. Mueller 4 -----END PRIVACY-ENHANCED MESSAGE-----