-----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, Ka5GET7978Ij4WwRLVygAbuGCSNHtSp9Q4WFUvKckgG0k8R/xTS1TfIqf5gHP62/ 9HwJMoHg9U/2W3w2AU596w== 0000950134-99-010475.txt : 19991122 0000950134-99-010475.hdr.sgml : 19991122 ACCESSION NUMBER: 0000950134-99-010475 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991119 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: 10-Q SEC ACT: SEC FILE NUMBER: 000-17171 FILM NUMBER: 99760878 BUSINESS ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 1210 CITY: DALLAS STATE: TX ZIP: 75251 BUSINESS PHONE: 9723877777 MAIL ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 1210 CITY: DALLAS STATE: TX ZIP: 75251 10-Q 1 FORM 10-Q FOR QUARTER ENDED SEPTEMBER 30, 1999 1 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q X Quarterly report pursuant to Section 13 or 15(d) of the Securities - ---- Exchange Act of 1934 For the quarterly period ended September 30, 1999 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 Registrant as specified in its Charter) DELAWARE 75-2212772 (State of Incorporation) (I.R.S. Employer Identification No.) 12750 MERIT DRIVE, SUITE 720, DALLAS, TEXAS 75251 (Address of principal executive offices, including zip code) (972) 387-7777 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ------ ------ 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 12,341,290 as of November 12, 1999 - -------------------------------------------------------------------------------- 2 URANIUM RESOURCES, INC. 1999 THIRD QUARTERLY REPORT ON FORM 10-Q TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets - September 30, 1999 (Unaudited) and December 31, 1998 3 Consolidated Statements of Operations - Three and Nine Months Ended September 30, 1999 and 1998 (Unaudited) 5 Consolidated Statements of Cash Flows - Nine Months Ended September 30, 1999 and 1998 (Unaudited) 6 Notes to Consolidated Financial Statements - September 30, 1999 (Unaudited) 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II -- OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 14 SIGNATURES 15 INDEX TO EXHIBITS E-1
2 3 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 1999 AND DECEMBER 31, 1998 (NOTE 1) ASSETS
September 30, December 31, --------------- --------------- 1999 1998 --------------- --------------- (Unaudited) Current assets: Cash and cash equivalents $ 215,542 $ 3,713,566 Short-term investment: Certificate of deposit, restricted 585,055 582,623 Receivables, net 84,046 1,482,806 Uranium inventory 1,400,962 956,590 Materials and supplies inventory 75,314 92,495 Prepaid and other current assets 101,076 244,301 --------------- --------------- Total current assets 2,461,995 7,072,381 --------------- --------------- Property, plant and equipment, at cost: Uranium properties 99,751,130 98,073,350 Other property, plant and equipment 507,971 538,974 Less-accumulated depreciation and depletion (59,614,258) (59,059,968) --------------- --------------- Net property, plant and equipment 40,644,843 39,552,356 Other assets 4,299 4,299 Long-term investment: Certificate of deposit, restricted 3,066,703 3,066,703 --------------- --------------- $ 46,177,840 $ 49,695,739 =============== ===============
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 3 4 URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 1999 AND DECEMBER 31, 1998 (NOTE 1) LIABILITIES AND SHAREHOLDERS' EQUITY
September 30, December 31, --------------- --------------- 1999 1998 --------------- --------------- (Unaudited) Current liabilities: Accounts payable $ 327,218 $ 1,829,255 Notes payable 450,000 1,685,000 Accrued interest payable 3,993 113,778 Current portion of long-term debt 7,000 8,000 Royalties payable -- 132,626 Current portion of restoration reserve 83,000 324,000 Other accrued liabilities 256,775 348,337 --------------- --------------- Total current liabilities 1,127,986 4,440,996 --------------- --------------- Other long-term liabilities and deferred credits 6,325,208 5,469,394 Long-term debt, less current portion 6,238,955 6,189,007 Deferred federal income taxes 19,810 263,810 Shareholders' equity: Common stock, $0.001 par value, shares authorized: 1999 - 35,000,000 1998 - 25,000,000; shares issued and outstanding (net of treasury shares): 1999 - 12,341,290 1998 - 12,053,027 12,494 12,205 Paid-in capital 40,737,736 40,629,923 Retained earnings (accumulated deficit) (8,274,931) (7,300,178) Less: Treasury stock (152,500 shares), at cost (9,418) (9,418) --------------- --------------- Total shareholders' equity 32,465,881 33,332,532 --------------- --------------- $ 46,177,840 $ 49,695,739 =============== ===============
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 NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998 (NOTE 1) (UNAUDITED)
Three Months Ended Nine Months Ended September 30, September 30, -------------------------------- -------------------------------- 1999 1998 1999 1998 -------------- -------------- -------------- -------------- Revenues: Uranium sales - Produced uranium $ 2,092,244 $ 2,579,457 $ 3,128,594 $ 8,689,883 Purchased uranium 1,036,350 1,924,100 1,037,862 4,321,400 -------------- -------------- -------------- -------------- Uranium sales 3,128,594 4,503,557 4,166,456 13,011,283 Other uranium revenues 1,289,600 -- 1,289,600 -- -------------- -------------- -------------- -------------- Total revenue 4,418,194 4,503,557 5,456,056 13,011,283 Costs and expenses: Cost of uranium sales - Direct cost of purchased uranium 2,500,046 1,574,701 2,500,046 3,591,371 Royalties 9,000 132,345 66,234 407,862 Operating expenses 417,979 1,358,149 2,125,599 3,979,050 Provision for restoration and reclamation costs 16,440 165,818 152,383 493,252 Depreciation and depletion 118,930 1,357,225 468,107 4,426,509 Writedown of uranium properties -- 18,034,694 -- 18,034,694 -------------- -------------- -------------- -------------- Total cost of uranium sales 3,062,395 22,622,932 5,312,369 30,932,738 -------------- -------------- -------------- -------------- Earnings (loss) from operations before corporate expenses 1,355,799 (18,119,375) 143,687 (17,921,455) Corporate expenses - General and administrative 498,000 530,978 1,491,639 1,806,461 Depreciation 6,011 4,966 18,954 14,698 -------------- -------------- -------------- -------------- Total corporate expenses 504,011 535,944 1,510,593 1,821,159 -------------- -------------- -------------- -------------- Income (loss) from operations 851,788 (18,655,319) (1,366,906) (19,742,614) Other income (expense): Interest expense, net of capitalized interest (38,514) (37,863) (115,358) (114,270) Interest and other income, net 158,705 47,513 263,511 144,317 -------------- -------------- -------------- -------------- Total other income 120,191 9,650 148,153 30,047 -------------- -------------- -------------- -------------- Income (loss) before federal income taxes 971,979 (18,645,669) (1,218,753) (19,712,567) Federal income tax expense (benefit): Deferred 19,810 (3,730,000) (244,000) (3,942,000) -------------- -------------- -------------- -------------- Net income (loss) $ 952,169 $ (14,915,669) $ (974,753) $ (15,770,567) ============== ============== ============== ============== Net income (loss) per common share and common equivalent (basic and diluted) $ 0.08 $ (1.24) $ (0.08) $ (1.31) ============== ============== ============== ============== Weighted average common shares and common equivalent shares per share data: Basic 12,257,310 12,053,027 12,122,614 12,053,027 ============== ============== ============== ============== Diluted 12,257,310 12,053,027 12,122,614 12,053,027 ============== ============== ============== ==============
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 NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998 (NOTE 1) (UNAUDITED)
September 30, ---------------------------- 1999 1998 ------------ ------------ Cash flows from operations: Net loss $ (974,753) $(15,770,567) Reconciliation of net income to cash provided by operations- Provision for restoration and reclamation costs 152,383 493,252 Depreciation and depletion 487,061 4,441,207 Writedown of uranium property and other assets -- 18,034,694 Credit for deferred income taxes (244,000) (3,942,000) Decrease in restoration and reclamation accrual (330,045) (23,891) Other non-cash items, net 1,209,572 528,549 ------------ ------------ Cash flow provided by operations, before changes in operating working capital items 300,218 3,761,244 Effect of changes in operating working capital items- Decrease in receivables 1,398,760 1,213,521 Increase in inventories (208,318) (170,220) Increase in prepaid and other current assets (149,007) (219,030) Decrease in payables and accrued liabilities (1,836,010) (2,009,514) ------------ ------------ Net cash provided by (used in) operations (494,357) 2,576,001 ------------ ------------ Investing activities: Increase in investments (2,432) (257,768) Additions to property, plant and equipment - Kingsville Dome (125,170) (2,974,452) Rosita (59,622) (227,218) Vasquez (50,656) (427,271) Alta Mesa (33,724) (55,103) Churchrock (558,361) (833,416) Crownpoint (741,598) (594,670) Other property (191,221) (405,672) Increase in other assets -- (26,752) ------------ ------------ Net cash used in investing activities (1,762,784) (5,802,322) ------------ ------------ Financing activities: Payments and refinancings of principal (3,390,883) (5,455,322) Proceeds from borrowings 2,150,000 7,335,000 ------------ ------------ Net cash provided by (used in) financing activities (1,240,883) 1,879,678 ------------ ------------ Net decrease in cash and cash equivalents (3,498,024) (1,346,643) Cash and cash equivalents, beginning of period 3,713,566 2,325,158 ------------ ------------ Cash and cash equivalents, end of period $ 215,542 $ 978,515 ============ ============
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-Q and Rule 10-01 of Regulation S-X. 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 1998 Annual Report on Form 10-K. 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 three and nine months ended September 30, 1999 are not necessarily indicative of the results that may be expected for the full calendar year ending December 31, 1999. 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. Due to a continued period of depressed prices for uranium as compared to the Company's cost to produce uranium, the Company has generated operating losses in each of the last two years. Operating losses have continued during the first nine months of 1999. Such price declines have reduced the market price of uranium to levels that are currently below the Company's cost to produce uranium and below levels needed by the Company to obtain the necessary financing to allow development of new production areas at its South Texas sites. Due to circumstances described above, during the first quarter of 1999 the Company shut-in its current producing operations until uranium prices recover. The Company has limited financial resources available to support its ongoing operations, fund payments of debt, potential claims in litigation and provide for restoration of its properties until such time, if ever, uranium prices recover to profitable levels. Further, the Company will require additional capital resources to fund the cost to resume production and to fund 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. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon a recovery of uranium prices, its ability to restart its uranium production facilities and successfully produce uranium at economically feasible levels and its ability to successfully raise capital to support ongoing operations and future development efforts. 3. REALIZABILITY OF URANIUM PROPERTIES VALUATION The Company had uranium properties with a net carrying value of approximately $40,557,000 at September 30, 1999. The Company's ability to recover its investment in these properties will be dependent upon a number of factors including an increase in the sales price of uranium, the Company's ability to deliver profitable uranium production into its existing and future sales contracts, the Company's ability to access the financing/capital that will be necessary to develop and commence uranium production and ultimately, its ability to continue to operate as a going concern. The valuation of each of the Company's uranium properties at September 30, 1999 was performed assuming that uranium production would commence at each property, at a future date. The valuation utilized a number of estimates and assumptions, including an increase in uranium prices to levels significantly above current uranium prices, the ability of the Company to secure the necessary financing to bring these properties into production and projected the timing and costs of future development and production activities. There can be no assurance that the estimates and assumptions used in the valuation will be able to be accomplished. 7 8 If the Company is unable to bring any of these properties into production it is unlikely that the Company would be able to realize its investment in that property. Should the Company sell, dispose or otherwise liquidate any of its uranium properties, the Company believes that the value from such sale would be significantly below the carrying value of the property and would result in a significant charge against operations. WRITEDOWN OF URANIUM PROPERTIES At September 30, 1998 the Company reviewed the carrying value of its uranium properties and determined that a writedown was required at that date with respect to its then producing properties (Kingsville Dome and Rosita projects) of approximately $18,000,000. The writedown for the Kingsville Dome and Rosita properties totaled $12,300,000 and $5,600,000 respectively. 4. LONG-TERM DEBT RESTRUCTURING OF NOTE In June 1999, the Company entered into an agreement to restructure the $6,000,000 secured convertible note that was issued to mutual funds managed by Ryback Management Company. The restructuring provides for the mandatory conversion of the debt into 6,000,000 shares of the Company's common stock, providing the Company obtains the necessary long-term uranium sales contracts and financing to allow the commencement of production at one of its uranium projects. Interest on the debt will accrue but not be payable until the maturity date, which was extended to December 31, 2000. Upon the maturity or the date of conversion, the noteholders will have the option to be paid the accrued interest in eighteen monthly installments or to convert the interest into shares of common stock at the lesser of the then market price for such stock or $1.00 per share. The noteholders also granted to the Company a right of first offer on the transfer of the notes or any shares into which the notes are convertible. CAPITALIZED INTEREST Interest capitalized in the nine months ended September 30, 1999 and 1998 was $462,000 and $497,000, respectively. Total interest costs in these periods were $577,000 and $611,000, respectively. 5. SHAREHOLDERS' EQUITY COMMON STOCK In September and June 1999, the Company issued 84,903 and 203,360 shares, respectively, of common stock to certain officers and directors of the Company in connection with the Uranium Resources, Inc. 1999 Deferred Compensation Plan (the "Plan"). The Plan was approved by a vote of the shareholders at the June 18, 1999 Annual Meeting. 6. OTHER URANIUM REVENUES In June 1999 the Company assigned its rights to deliver uranium for the years 2000 through 2002 (the final three years) under a uranium sales contract. In exchange for the assignment, the Company received 124,000 pounds of uranium inventory in July 1999. The transaction was valued at $10.40 per pound for the uranium inventory received (the spot market price of uranium) and resulted in increased revenue, earnings from operations and income before income taxes of $1,290,000 in the third quarter of 1999. 8 9 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. Among the factors that could cause actual results to differ materially include: the ability of the Company to meet its working capital and liquidity needs, the availability of sufficient collateral to support borrowings under the Company's existing $3.0 million revolving credit facility, the outcome of rulings from state and federal regulatory bodies that regulate all aspects of the Company's operations, the market price of uranium remaining at levels which would preclude the Company from securing additional long-term sales contracts and other risks which may have a significant impact on the Company, its property development or its operations. 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 1998 Annual Report on Form 10-K. Going Concern In connection with the issuance of the Company's December 31, 1998 audited financial statements the Company's Independent Public Accountants issued a modified opinion regarding substantial doubt concerning the Company's ability to continue as a going concern. The Company has implemented significant steps in 1999 to restructure its long-term debt, to reduce costs and to accelerate revenues from future periods into this year which have allowed the Company to maintain positive liquidity in 1999. The Company's continuing viability as a going concern will be dependent upon its ability to satisfy the terms of the restructured long-term debt, which would allow for the conversion of the debt into common stock, its ability to raise sufficient working capital through existing or alternative sources of financing and to meet liquidity needs that may exceed the Company's availability under its current revolving credit facility. In the event that the Company is unable to conclude these steps and other sources of capital or financing are not available the Company would not be able to continue as a going concern. CAPITAL RESOURCES AND LIQUIDITY Operating Cash Flows and Liquidity For the quarter ended September 30, 1999, the Company's cash and cash equivalents were $216,000 a decrease in the quarter of $131,000 as compared to an decrease of $515,000 for the third quarter of 1998. Cash and cash equivalents decreased by $3,498,000 for the nine months ended September 30, 1999 compared to a decrease of $1,347,000 for the same period in 1998. The Company's uranium operations generated cash flow from operations of $632,000 for the quarter ended September 30, 1999, in comparison to negative cash flow from operations in the same period in 1998 of $1,751,000. Net cash used in operations for the nine months ended September 30, 1999 was $494,000 compared to net cash provided by operations of $2,576,000 for the same period in 1998. The Company's net working capital at September 30, 1999 was $1,334,000. 9 10 As a result of the volatility of spot prices in the uranium marketplace, during the first quarter of 1999 the Company shut-in and placed on stand-by its two South Texas facilities. Nominal production from these sites continued through July 1999 because their incremental production costs were at or below the cost of purchasing uranium in the marketplace. The Company will continue to maintain certain activities at these locations including its ongoing groundwater restoration efforts. Investing Cash Flows South Texas Projects During the nine months ending September 30, 1999, capital expenditures at the Company's South Texas locations totaled $235,000. The Company's decision to put its Kingsville Dome and Rosita sites on stand-by has significantly reduced capital spending at these locations. The Company expects to fund its 1999 expenditures at its South Texas projects from cash on hand, sales proceeds under 1999 uranium deliveries and through existing financing arrangements. Funding of operations into 2000 will be dependent upon the Company's ability to secure new or expand existing sources of financing, raise capital and/or monetize the Company's existing assets. New Mexico Projects Capital expenditures at the Company's Churchrock and Crownpoint projects for permitting and land holding costs totaled approximately $1,300,000 for the nine months ending September 30, 1999 compared to costs of $1,428,000 for the same period in 1998. Capital requirements for 1999 for these projects is expected to be met from cash on hand, sales proceeds under 1999 uranium deliveries and through existing financing arrangements. Funding into 2000 will be dependent upon the Company's ability to secure new or expand existing sources of financing, raise capital and/or monetize the Company's existing assets. Financing Cash Flows In May 1996, the Company entered into a $3.0 million revolving credit facility. This facility was renewed and expanded for a two-year term to a $5.0 million credit facility in July 1997. In July 1999, the facility was amended to extend the term for one year and to adjust the amount available under the agreement to $3.0 million. This facility is secured by the Company's uranium inventory and/or by receivables from its uranium sales contracts. Principal and interest payments under the loan are due monthly, with interest on the loan accruing at the prime rate plus 1%. Borrowings under this facility at September 30, 1999 totaled $450,000. 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 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-K as of December 31, 1998. 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. The Company's customers have generally elected, where possible, to take delivery of the bulk of the annual deliveries under their long-term sales contracts later in each year. 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. 10 11 Three and Nine Months Ended September 30, 1999 and 1998 The following is a summary of the key operational and financial statistics related to the Results of Operations:
Three Months Ended Nine Months Ended September 30, September 30, ------------------------------ ------------------------------ 1999 1998 1999 1998 ------------ ------------- ------------ ------------ (In thousands, except per pound data) Uranium sales revenue(a) $ 3,129 $ 4,504 $ 4,166 $ 13,011 Other uranium revenues 1,290 -- 1,290 -- Total pounds delivered 235 328 305 860 Average sales price/pound(b) $ 13.29 $ 15.00 $ 13.64 $ 15.66 Pounds produced 3 162 107 519 Pounds purchased 274 160 274 360 Average production cost of produced pounds (c) $ 16.69 (c) $ 17.23 Average cost of purchased pounds $ 10.59 $ 9.84 $ 10.59 $ 10.29 Average cost of produced pounds sold N/A $ 14.35 $ 13.01 $ 14.85 Average cost of purchased pounds sold $ 10.62 $ 9.84 $ 10.62 $ 10.29
(a) Revenues for the three and nine months ended September 30, 1998 include approximately $655,000 for the sales of Russian uranium sold under the Matched Sales Amendment. (b) Average sales price in 1998 does not include the sale of Russian material which is considered as a "pass through" sale under the Matched Sales Amendment. (c) 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 has been valued at the current spot market cost. The Company delivered 305,000 pounds of uranium in the nine months ended 1999 at an average sales price of $13.64 per pound. The Company also generated $1,290,000 in revenue in the third quarter of 1999 from the assignment of future uranium deliveries under one of its long-term sales contracts. Total uranium deliveries in the nine months of 1998 of 860,000 pounds were at an average sales price of $15.66 per pound and generated revenues of $13,011,000. 11 12 Details of the cost of uranium sales were as follows:
Three Months Ended Nine Months Ended September 30, September 30, ----------------------------- ----------------------------- 1999 1998 1999 1998 ------------- ------------- ------------- ------------- (In thousands) (In thousands) Cost of purchased uranium $ 2,500 $ 1,575 $ 2,500 $ 3,591 Royalties 9 132 66 408 Operating expenses 418 1,358 2,126 3,979 Provision for restoration and reclamation costs 16 166 152 493 Depreciation and depletion of uranium properties 119 1,357 468 4,427 ------------- ------------- ------------- ------------- $ 3,062 $ 4,588 $ 5,312 $ 12,898 ------------- ------------- ------------- -------------
The Company placed its South Texas production facilities on stand-by in the first quarter of 1999 but continued to maintain nominal production through July 1999. Total production of 107,000 pounds during the first nine months of 1999 compared to 519,000 pounds of production in the nine months ended September 30, 1998. Certain production related activities continued in 1999 while the facilities were on stand-by because the incremental cash costs (costs incurred in addition to those required to maintain the projects while in a stand-by mode) were below the cost uranium could be purchased in the spot market. Operating expenses in the first nine months of 1999 were $2,126,000 and consisted of stand-by costs ($1,131,000) production sold ($572,000 or $8.17 per pound) and a lower of cost or market adjustment ($423,000). Operating expenses in the nine months ended September 30, 1998 were attributable to the sale of Kingsville Dome and Rosita produced pounds of $3,127,000 ($6.12 per pound) and lower of cost or market adjustment of $852,000. The provision for restoration and reclamation in the first nine months of 1999 was $152,000 and consisted of $66,000 ($0.94 per pound) for production sold and $86,000 for restoration related to a previous production site. The costs incurred in the first nine months of 1998 were $493,000 and were made up of $482,000 ($0.94 per pound) related to production sold during the period and $11,000 for other restoration activities. The depreciation and depletion provision in the nine months ended September 30, 1999 was $468,000 and consisted of $273,000 ($3.90 per pound) for produced uranium sold and $195,000 for depreciation while on stand-by. Comparable costs for 1998 were $3,975,000 ($7.78 per pound) resulting from Rosita and Kingsville Dome production sold during that period and a lower of cost or market adjustment of $452,000. The Company incurred royalty expenses of $66,000 in the first nine months of 1999 compared to royalty expenses in the first nine months of 1998 of $408,000. The reduction in expense in the first nine months of this year is attributable to lower deliveries of produced pounds when compared to the same period of 1998. The Company purchased 274,000 pounds of uranium in the first three quarters of 1999 at an average cost of $10.59 per pound. Uranium purchases of 360,000 were made in the first nine months of 1998 at an average cost of $10.29 per pound. Corporate expenses consisting of general and administrative ("G&A") expenses decreased by $310,000, to $1,511,000 in the first nine months of 1999 from $1,821,000 in the same period of 1998. This reduction resulted primarily from the implementation of the Company's cost reduction program which began in the fourth quarter of 1998 and continues throughout 1999. 12 13 YEAR 2000 READINESS The Company currently utilizes computer software in the management of its operations and in accounting for its operating results that could be affected by the date change in the year 2000 (the "Y2K issue"). All critical information technology software and systems utilized by the Company has been purchased from and are supported by third party vendors. The Company has conducted a review of the potential impact of the year 2000 on such systems, and believes that it will not encounter significant operational or financial costs related to compliance with this issue. The Y2K issue also involves the impact of the date change in the year 2000 on machines and process controls which may utilize embedded technology as a part of their components. The Company relies on certain non-information technology systems such as telephones, facsimile machines, and other equipment which may have embedded technology such as microprocessors, which may or may not be year 2000 compliant. The assessment of this technology is outside of the Company's control and such technology could adversely affect the Company's ability to conduct business. Management believes any such disruption is not likely to have a significant effect on the Company's financial position or operations. The Company may also be impacted by the Y2K issues of certain of the Company's third-party suppliers and its customers. The third-party suppliers, vendors, and customers area is currently in the assessment phase. Formal communications have been initiated with the Company's vendors, customers and others with whom the Company has significant business relationships. The Company continues to evaluate responses and make additional inquiries as needed. As the Company is in the process of collecting this information from third parties, management cannot currently determine whether third party compliance issues will materially affect its operations. However, the Company is not currently aware of any third party issues that would cause a significant business disruption. 13 14 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. None ITEM 2. CHANGES IN SECURITIES. In September 1999, the Company issued 84,903 shares of common stock to certain officers and directors of the Company in connection with the Uranium Resources, Inc. 1999 Deferred Compensation Plan (the "Plan"). The Plan was approved by a vote of the shareholders at the June 18, 1999 Annual Meeting. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None ITEM 5. OTHER INFORMATION. None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Financial Data Schedule (b) 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. 14 15 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: November 18, 1999 By: /s/ Paul K. Willmott -------------------------------------------- Paul K. Willmott Director, President and Chief Executive Officer Dated: November 18, 1999 By: /s/ Thomas H. Ehrlich -------------------------------------------- Thomas H. Ehrlich Vice President - Finance and Chief Financial Officer (Principal Financial and Accounting Officer) 15 16 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* Restated Bylaws of the Company (filed with the Company's Form S-3 Registration No. 333-17875 on December 16, 1996). 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* Non-Qualified Stock Option Agreement dated May 25, 1995, between the Company and James B. Tompkins (filed with the Company's Annual Report on Form 10-K dated March 27, 1996). 10.7* Stock Option Agreement dated March 6, 1995 between the Company and James P. Congleton, as amended on May 25, 1995 (filed with the Company's Annual Report on Form 10-K dated March 27, 1996). 10.8* Warrant to Purchase Common Stock dated May 25, 1995, between the Company and Grant Bettingen, Inc. (filed with the Company's Annual Report on Form 10-K dated March 27, 1996). 10.9* Non-Qualified Stock Option Agreement dated July 31, 1995, between the Company and Wallace M. Mays (filed with the Company's Form S-8 Registration Statement No. 33-64481 on November 21, 1995). 10.10* Contract for the Purchase of Natural Uranium Concentrates (U3O8) dated April 5, 1994 between Uranium Resources, Inc., URI, Inc. and Pacific Gas & Electric Company (filed with the Company's Annual Report on Form 10-K for the year ended December 31, 1994).(1)
E-1 17
EXHIBIT NUMBER DESCRIPTION ------- ----------- 10.11* Agreement for the Sale of Uranium Concentrates dated as of August 23, 1990 between OES Fuel, Incorporated, Uranium Resources, Inc. and URI, Inc. (filed with Post-Effective Amendment No. 3 to the Company's Form S-1 Registration Statement as filed with the Securities and Exchange Commission on December 7, 1990).(1) 10.12* 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). 10.13* Note and Warrant Purchase Agreement entered into May 25, 1995 by and among Lindner Investments, Lindner Dividend Fund and the Company (filed with the Company's Current Report on Form 8-K dated May 25, 1995). 10.14* Loan Agreement entered into June 18, 1996 by and between Lindner Dividend Fund and the Company (filed with the Company's Annual Report on Form 10-K dated March 27, 1997). 10.15* Uranium Concentrates Sales Agreement dated August 21, 1996 by and between the Company and Commonwealth Edison Company (filed with the Company's Quarterly Report on Form 10-Q/A-2 for the quarter ended September 30, 1996).(1) 10.16* 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) 10.17* 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). 10.18* 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) 10.19* 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) . 10.20* 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). 10.21* Amendment #1 to Nonqualified Stock Option Agreement dated November 17, 1997 between the Company and James B. Tompkins (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.22* 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).
E-2 18
EXHIBIT NUMBER DESCRIPTION ------- ----------- 10.23* Compensation Agreement dated June 2, 1997 between the Company and Richard F. Clement, Jr. (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.24* Compensation Agreement dated June 2, 1997 between the Company and Joe H. Card (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.25* 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). 10.26* 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). 10.27* 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). 10.28* Warrant to Purchase Common Stock for 625,000 shares dated March 23, 1998 between the Company and Lindner Investments (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.29* Warrant to Purchase Common Stock for 325,000 shares dated March 23, 1998 between the Company and Lindner Investments (filed with the Company's Annual Report on Form 10-K dated March 27, 1998). 10.30* Uranium Resources, Inc. 1999 Deferred Compensation Plan (filed with the Company's Annual Report on Form 10-K dated March 31, 1999). 10.31* Certificate of Amendment of Restated Certificate of Incorporation dated June 22, 1999 (filed with the Company's Report on Form 10-Q dated June 30, 1999). 10.32* Note Exchange Agreement dated June 30, 1999 between the Company and Lindner Investments (filed with the Company's Report on Form 10-Q dated June 30, 1999). 10.33* 6.5% Secured Convertible Note for $1,500,000 dated June 30, 1999 between the Company and Lindner Investments (filed with the Company's Report on Form 10-Q dated June 30, 1999). 10.34* 6.5% Secured Convertible Note for $4,500,000 dated June 30, 1999 between the Company and Lindner Investments (filed with the Company's Report on Form 10-Q dated June 30, 1999). 10.35 Uranium Resources, Inc. Amended and Restated 1999 Deferred Compensation Plan. 27.1 Financial Schedule.
*Incorporated by reference pursuant to Rule 12b-32 under the Securities and Exchange Act of 1934, as amended. (1)Certain provisions have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. E-3 EX-10.35 2 AMENDED & RESTATED 1999 DEFERRED COMPENSATION PLAN 1 EXHIBIT 10.35 URANIUM RESOURCES, INC. AMENDED AND RESTATED 1999 DEFERRED COMPENSATION PLAN EFFECTIVE SEPTEMBER 17, 1999 ARTICLE I INTRODUCTION 1.1 This Amended and Restated 1999 Deferred Compensation Plan (the "Plan") provides selected executive employees and directors of Uranium Resources, Inc. and its wholly owned subsidiaries an opportunity to defer a portion of their compensation for calendar year 1999. This document constitutes the entire Plan. Any and all prior or contemporaneous oral or written communications hereby are superseded and abolished. ARTICLE II DEFINITIONS AND GENERAL PROVISIONS 2.1 "ACCOUNT" or "ACCOUNTS" means the individual deferral accounts separately maintained under this Plan on the books of the Corporation for the benefit of each Participant. Each Account shall be credited with a Participant's Deferred Amount of Earned Compensation less any portion of such Earned Compensation as to which shares of Common Stock have been distributed in accordance with Article V. 2.2 "ADDITIONAL DEFERRED AMOUNT" means the additional amount of Compensation that a Participant has elected to defer pursuant to Section 4.1(b) hereof. 2.3 "ADDITIONAL SHARE PERCENT" means the portion (expressed as a percentage) of the Additional Deferred Amount that a Participant elects to receive in shares of Common Stock. 2.4 "CODE" means the Internal Revenue Code of 1986, as amended and then in effect. 2.5 "COMMITTEE" means the Plan Committee described in Article VII hereof. 2.6 "COMMON STOCK" means the shares of the Corporation's common stock, $.001 par value per share. 2.7 "COMPENSATION" means those amounts otherwise payable in cash or by check or electronic deposit by the Corporation to an Eligible Person as salary for a Plan Year, which amounts are includable in his gross income for federal income tax purposes (without regard to Compensation deferred under this or any other plan maintained by the Corporation), including 2 but not limited to directors' fees, salary and bonus, but excluding any and all nonelective contributions (including matching contributions) made by the Corporation to any employee benefit plan (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended). Without limiting the generality of the foregoing, the limitations imposed by Code Section 401(a)(17) do not apply to Compensation as defined under the Plan. 2.8 "CORPORATION" means Uranium Resources, Inc, a Delaware corporation, together with any successor thereto which adopts this Plan by appropriate written action. 2.9 "DEFERRED AMOUNT" means the sum of the Initial Deferred Amount and the Additional Deferred Amount. 2.10 "DESIGNATED RECIPIENT" means any person who becomes entitled to receive any distribution hereunder by reason of the death of a Participant. 2.11 "EARNED COMPENSATION" means at any date the amount of Compensation that the Corporation is obligated to pay Participant for services rendered before giving effect to the Participant's deferral election. 2.12 "EFFECTIVE DATE" means January 11, 1999 as to the original Plan and September 17, 1999 as to the Amended and Restated Plan. 2.13 "ELIGIBLE PERSON" means any employee or director of the Corporation or any of its wholly owned subsidiaries, but only so long as such person meets all of the requirements of Section 3.1(a) of the Plan. 2.14 "ERISA" means The Employee Retirement Income Security Act of 1974, as amended and then in effect. 2.15 "INITIAL DEFERRAL PERCENT" means the portion (expressed as a percentage) of the Compensation that a Participant elects to defer pursuant to Section 4.1 hereof. 2.16 "INITIAL DEFERRED AMOUNT" means the amount of Compensation that a Participant has elected to defer on January 11, 1999 pursuant to Section 4.1(a) hereof. 2.17 "INITIAL SHARE PERCENT" means the portion (expressed as a percentage) of the Initial Deferred Amount that a Participant elects to receive in shares of Common Stock. 2.18 "PARTICIPANT" means any Eligible Person who defers Compensation under the Plan. 2.19 "PLAN YEAR" means the period of time commencing January 11, 1999 and ending on December 31, 1999. 3 2.20 "SHARE PRICE" means (a) with respect to shares to be received in connection with the Initial Deferred Amounts $0.375, which was the price of the last trade of the Common Stock on NASDAQ on January 11, 1999, the date this Plan was originally adopted and (b) with respect to shares to be received in connection with the Additional Deferred Amounts $0.156, which was the price of the last trade of the Common Stock on OTCBB on September 17, 1999, the date that the Board of Directors adopted the Amended and Restated Plan. 2.21 "VESTED SHARES" means the number of shares of Common Stock determined in accordance with Section 5.4. 2.22 GENERAL PROVISIONS. The masculine wherever used herein shall include the feminine and singular and plural forms are interchangeable. Certain terms of more limited application have been defined in the provisions to which they are principally applicable. The division of the Plan into Articles and Sections with captions has been done for convenience only and is not to be taken as limiting or extending the meaning of any of its provisions. ARTICLE III ELIGIBILITY AND PARTICIPATION 3.1 General Eligibility Conditions. (a) To become eligible to participate in this Plan, an individual must be (i) an executive employee or a director of the Corporation or any of its wholly owned subsidiaries and (ii) designated as an Eligible Person on Exhibit A. (b) Once an Eligible Person becomes a Participant, such individual shall continue to be eligible to defer Compensation under the terms of this Plan until such individual fails to meet at least one of the conditions described above. If a Participant ceases to meet such conditions, his interest in the Plan and amounts deferred prior to the date he ceases to be an Eligible Person shall continue to be held subject to the terms of the Plan, and Vested Shares and Deferred Amounts shall be distributable to him in accordance with Article VI. For the purposes of Deferred Amounts that are to be distributed thereafter and for such purpose only, such person shall continue to be a Participant. 3.2 Election to Participate. To actively participate in the Plan, an Eligible Person must execute a Deferred Compensation Election in the form attached hereto as Exhibit C and shall file such election with the Committee. 4 ARTICLE IV DEFERRAL OF COMPENSATION 4.1 Deferral Elections. (a) Initial Deferred Percent. An Eligible Person may elect to defer receipt of up to 100% of his Compensation. As of January 11, 1999, the Participants have elected to defer the portion of their Compensation set forth on Exhibit B hereto. Such elections are irrevocable for the Plan Year unless the Corporation and the Participant agree otherwise. (b) Additional Deferred Amounts. With the consent of the Committee, a Participant may at any time elect, in writing, to increase the percentage of his Compensation to be deferred. 4.2 Period of Deferral. All amounts that the Participant elects to defer shall be paid on January 11, 2006, subject to the Participant's right to receive all or any portion of the amount deferred in shares of Common Stock as set forth in Article V. 4.3 Vesting. A Participant shall always be one hundred percent (100%) vested in amounts credited to his Account. 4.4 Base Salary for Other Purposes. Except as otherwise expressly prohibited by law or the terms of a benefit plan, any Deferred Amounts shall continue to be counted as part of the Participant's base salary for purposes of any other contracts between Participant and the Corporation, including, without limitation, those certain compensation agreements dated June 2, 1997 between the Corporation and certain of the Participants. 5 ARTICLE V ELECTION TO RECEIVE COMMON STOCK 5.1 Share Election. (a) Initial Share Percent. The Participants may elect to receive up to 100% of the Initial Deferred Amount in shares of Common Stock. With respect to the Initial Deferred Amounts the Participants have made the Initial Share Percent elections set forth on Exhibit B. The Participants may not change the Initial Share Percent elections without the consent of the Committee, except on the last day of each calendar quarter during the Plan Year. Any such change shall be effective only with respect to Initial Deferred Amounts credited for the calendar quarters following such change. (b) Additional Share Percent. A Participant shall have the right, with respect to Additional Deferred Amounts, to elect at any time prior to January 11, 2006 to receive shares of Common Stock in lieu of a payment of all or any portion of the Additional Deferred Amount. 5.2 Number of Shares to be Received. (a) The number of shares of Common Stock to be credited with respect to any election to receive shares for all or any portion of the Initial Deferred Amount shall equal the Initial Deferred Amount multiplied by the Initial Share Percent and divided by the Share Price. No fractional shares shall be issued. (b) The number of shares of Common Stock to be credited with respect to any election to receive shares for all or any portion of the Additional Deferred Amount shall equal the Additional Deferred Amount divided by the Share Price. No fractional shares shall be issued. 5.3 Distribution of Shares. (a) With respect to any election to receive shares for all or any portion of the Initial Deferred Amount, there shall be issued to Participant as of the last day of March, June, September and December during the Plan Year his Vested Shares as set forth in Section 5.4; provided, however, that the Committee may elect to distribute shares of Common Stock at different times in its sole and absolute discretion. (b) With respect to any election to receive shares for all or any portion of the Additional Deferred Amount, there shall be issued to Participant, within 30 days after a Participant's election to receive shares, his Vested Shares as set forth in Section 5.4. (c) The Term "Distribution Date" means each of the last day of March, June, September and December during a Plan Year and January 11, 2006. 6 5.4 Vested Shares. (a) With regard to shares issuable with respect to the Initial Deferred Amount, a Participant shall have a vested interest only in that number of shares of Common Stock determined in accordance with the following formula: Vested Shares = Earned Compensation, Multiplied by Initial Deferral Percent, Multiplied by Initial Share Percent and divided by the Share Price. (b) With regard to shares issuable with respect to the Additional Deferred Amount, a Participant shall have a vested interest only in that number of shares of Common Stock determined in accordance with the following formula: Vested Shares = the portion of the Additional Deferred Amount that constitutes Earned Compensation, Multiplied by the Additional Share Percent and divided by the Share Price. 5.5 Limitation on Sale of Shares. All certificates representing any of the shares of Common Stock shall have endorsed thereon the following legend: "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED." 5.6 Withholding. The Corporation will make appropriate withholding for all relevant federal, state and local tax purposes from the non-deferred portion of Compensation for any Participant with respect to the shares of Common Stock that a Participant has elected to receive based on the Share Price. On each Distribution Date if the fair market value of the Common Stock is in excess of the Share Price, the Corporation will be required to withhold additional amounts based upon such excess. The source of such additional amounts will be Compensation otherwise payable to the Participant on a Distribution Date, to the extent sufficient. If such amounts are insufficient, the Participant will be required to pay to the Corporation the appropriate amounts as a condition to receipt of the shares. ARTICLE VI DISTRIBUTIONS 6.1 Distribution of Cash. All amounts credited to an Account as to which a Participant has not elected to take such amount in shares of Common Stock shall be distributed to the Participant or his Designated Recipient on January 11, 2006; provided that the Committee may elect, in its sole and absolute discretion, to distribute such Deferred Amounts at an earlier date. 7 6.2. Distribution of Shares of Common Stock. Any amounts as to which the Participant has elected to receive shares of Common Stock as provided in Article V shall be distributed to the Participant or his Designated Recipient as provided in Article V. 6.3 If No Designated Recipient. If Participant has not designated a Designated Recipient, any distribution hereunder after the death of a Participant shall be payable first to his surviving spouse, if any, and if none, to his estate. 6.4 Effect of Termination of Employment. Upon termination of employment of a Participant for any reason, including death, such Participant's Account will be frozen on the date of termination. The Account shall be credited with a Participant's Deferred Amount of the Earned Compensation through the date of termination, and the Participant shall be entitled to receive on January 11, 2006 the Deferred Amount of the Earned Compensation less any of the Deferred Amount received in shares of Common Stock pursuant to Article V. ARTICLE VII PLAN ADMINISTRATION 7.1 Administration. The Plan shall be administered by a committee as provided in Section 7.2 hereof, as an unfunded deferred compensation plan. 7.2 Plan Committee. (a) The Committee shall be the Corporation's Board of Directors. No member of the Committee shall act or participate in any action of the Committee directly affecting his own Account under the Plan, unless such action is of general application to all Participants. The Committee is authorized to interpret the Plan and, from time to time, may adopt such rules and regulations, consistent with the provisions of the Plan, as it may deem advisable to carry out the purposes of the Plan. (b) The Committee shall have all powers necessary to accomplish the purpose of the Plan, including, but not limited to, (i) the discretionary authority to interpret the Plan; (ii) the discretionary authority to determine all questions relating to the rights and status of Eligible Persons, Participants and Designated Recipients; and (iii) the discretionary authority to make any and all rules and regulations needed or advisable for the administration of the Plan as are not inconsistent with the terms and provisions hereof. (c) Without limiting the powers set forth herein, the Committee shall have the power to: (i) change or waive in writing any requirements of the Plan to conform with law or to meet special circumstances not anticipated or covered in the Plan; (ii) determine the times and places for holding meetings of the Committee and the notice to be given of such meetings; (iii) employ or otherwise retain such agents and assistants, counsel (who may be of counsel to the Corporation herein), and clerical and other service providers as 8 the Committee may require in carrying out the provisions of the Plan; and (iv) authorize one or more of their number, or any agent thereof, to execute or deliver any instrument on behalf of the Committee. 7.3 Statement of Participant's Account. As soon as practicable following the close of each Plan Year, and otherwise from time to time as the Committee in its sole discretion may direct, the Committee shall mail, via first class mail, to each Participant a written statement setting forth the Account of such Participant as of the end of a Plan Year. Any statement provided in accordance with this Section shall be deemed to have been accepted as correct, unless written notice to the contrary is received by the Committee within thirty (30) days after the mailing of such statement to the Participant. 7.4 Payment of Expenses. All costs and expenses incurred in administering the Plan shall be paid by the Corporation. ARTICLE VIII AMENDMENT AND TERMINATION 8.1 Amendment. The Corporation hereby reserves the right, at any time and from time to time, by written action of its Board of Directors (or by written action of an officer or officers of the Corporation to whom such Board of Directors has expressly delegated the authority to amend the Plan), to amend, modify or alter any or all of the provisions of the Plan without the consent of any Eligible Person, Participant, Designated Recipient or other person; however, no amendment shall operate retroactively so as to affect adversely any rights to which a Participant may be entitled under the provisions of the Plan as in effect prior to such action. Any such amendment, modification or alteration shall be expressed in an instrument executed by an authorized officer or officers of the Corporation, and shall become effective as of the date designated in such instrument. 8.2 Termination. The Corporation reserves the right to suspend, discontinue or terminate the Plan, at any time, in whole or in part, by written action of its Board of Directors, effective as of the date designated in such written action, without the consent any Eligible Person, Participant, Designated Recipient or other person. ARTICLE IX MISCELLANEOUS PROVISIONS 9.1 Employment Remains At Will. Nothing in the adoption, maintenance or operation of the Plan shall confer on any employee, Eligible Person or Participant the right to continued employment by the Corporation or by any affiliate or subsidiary corporation thereof, or be treated or considered evidence of an intent to provide continued employment to such individual, or affect in any way the right of the Corporation or such affiliate or subsidiary, to terminate such individual's employment, at any time and for any reason. Any question as to whether and when there has been a termination of a Participant's employment, and the cause of 9 such termination, shall be determined by the Committee; any such determination by the Committee shall be final, binding and conclusive. 9.2 Facility of Payments. Whenever, in the opinion of the Committee, a person entitled to receive any payment, or installment thereof, is under a legal disability or is unable to manage his financial affairs, the Committee shall have the discretionary authority to direct payments to such person's legal representative, or to a relative or friend of such person for his benefit. Alternatively, the Committee may in its discretion apply the payment for the benefit of such person in such manner as the Committee deems advisable. Any such payment or application of benefits, made in good faith and in accordance with the provisions of this Section, shall completely discharge any liability of the Plan, the Corporation and the Committee with respect to such payment or application of benefits. 9.3 Plan Is Unfunded; No Obligation to Fund. All Accounts or interests in the Plan are unfunded and the Corporation shall have no obligation to establish any special or separate fund, or segregate any of its assets in order to assure the payment of any amounts due or becoming due and payable under the Plan; however, to provide for the discharge of its obligations under the Plan, the Corporation may in its sole discretion establish a fund in its name, or acquire property or contract rights in its name; provided that no Participant or other person (other than the Corporation) shall acquire a legal or equitable interest in any such fund, property or contract. The right of a Participant or his Designated Recipient to receive a distribution hereunder shall constitute an unsecured claim against the general assets of the Corporation, and no Participant or Designated Recipient or other person shall have any right in or against any amounts credited under the Plan or any other specific assets of the Corporation. All amounts credited under the Plan to any Accounts maintained for or on behalf of a Participant shall constitute general assets of the Corporation and may be disposed of by the Corporation at such time and for such purposes as it may deem appropriate. 9.4 Anti-Alienation. No right, benefit or interest in the Plan shall be subject to anticipation, alienation, sale, assignment, pledge, partition, lien, levy, encumbrance or charge; and any attempt to anticipate, alienate, sell, assign, pledge, partition, lien, levy, encumber or charge the same shall be void. No such right, benefit or interest shall be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such benefits, including claims for alimony, marital assets or property, support, or separate maintenance by the spouse of the Participant. If a Participant should become insolvent or bankrupt, or attempt to anticipate, alienate, sell, assign, pledge, encumber or charge any right to benefits under this Plan, such Participant's interest in the Plan, in the discretion of the Committee, shall be extinguished; in such event, the Committee in its sole discretion may hold or apply the interest at issue, or any part thereof, for the benefit of such Participant, such Participant's spouse, or such Participant's Designated Recipient, in such manner as the Committee in its sole discretion may deem proper. Notwithstanding the generality of the foregoing, the Corporation shall have the unrestricted right to set off against or recover out of any payments or benefits becoming payable to or for the benefit of a Participant, at the time such payments or benefits otherwise become payable hereunder, any amounts owed or owing to the Corporation by such Participant. 10 9.5 Indemnification. Each Participant, by executing a Compensation Deferral Agreement and becoming a Participant hereunder, acknowledges and agrees to indemnify and hold the Corporation harmless from and against any damages, losses and expenses (including without limitation litigation costs incurred by the Corporation in connection with the administration of the Plan) arising from third-party claims disputes involving such Participant's Plan interest (including without limitation, tax liens and levies, creditors' claims, garnishment and bankruptcy proceedings, and proceedings in domestic relations court). 9.6 Unclaimed Interests. If the Committee shall at any time be unable to make distribution or payment of benefits hereunder to a Participant or any Designated Recipient of a Participant by reason of the fact that such Participant's or Designated Recipient's whereabouts is unknown, the Committee shall so certify, and thereafter the Committee shall attempt to locate such missing person. In the event that such missing person is not located with seven (7) years, then the Committee shall cause the Corporation to pay over to the Secretary of State of the state whose law has jurisdiction over such matters any and all amounts then owed to such person, in accordance with the unclaimed funds law of such state, and the Corporation's obligations thereto shall thereupon be considered fully and completely discharged and satisfied. 9.7 References to Code, Statutes and Regulations. Any and all references in this Plan to any provision of the Code, ERISA, or any other statute, law, regulation, ruling or order shall be deemed to refer also to any successor statute, law, regulation, ruling or order. 9.8 Liability. The Corporation, and its directors, officers and employees, shall be free from liability, joint or several, for personal acts, omissions, and conduct, and for the acts, omissions and conduct of duly appointed agents, in the administration of this Plan. 9.9 Governing Law; Severability. The Plan shall be construed according to the laws of the State of Texas, and all provisions hereof shall be administered according to the laws of that State, except to the extent preempted by federal law (including, without limitation, ERISA). In the event that any one or more of the provisions of the Plan shall for any reason be held to be invalid, illegal, or unenforceable, such invalidity, illegality or unenforceability shall not affect any other provision of the Plan; rather, the Plan shall be construed as if such invalid, illegal, or unenforceable provisions had never been contained herein, and there shall be deemed substituted such other provision as will most nearly accomplish the intent of the parties to the extent permitted by applicable law. 9.10 Taxes. The Corporation shall be entitled to withhold and remit any federal, state and local taxes from any distribution made hereunder which the Corporation believes are necessary, appropriate or required by relevant law, regulation or ruling. 9.11 Tax Consequences of Participation. While the Plan is designed to provide Eligible Persons the opportunity to defer Compensation on a tax-deferred basis, the Corporation makes no representation, warranty or guarantee of any federal, state or local tax consequences of participation in the Plan to any Participant or Designated Recipient (or personal representative or attorney-in-fact for such Participant or Designated Recipient). 11 9.12 Stockholder Approval. Implementation of the portion of this Plan that allows a Participant to make a share election is subject to the approval of the stockholders of the Corporation. In the event that the stockholders of the Corporation do not approve the share election aspect of this Plan, such aspect of the Plan will be deleted and the remainder of the Plan shall continue to be in full force and effect. IN WITNESS WHEREOF, URANIUM RESOURCES, INC, by action of its Board of Directors, has duly adopted Uranium Resources, Inc. 1999 Deferred Compensation Plan, effective as of the 11th day of January 1999 and the Amended and Restated Plan effective as of the 17th day of September 1999. URANIUM RESOURCES, INC By /s/ PAUL K. WILLMOTT ----------------------------------- Title Director, President and --------------------------------- Chief Executive Officer (Principal Executive Officer) EX-27.1 3 FINANCIAL DATA SCHEDULE
5 9-MOS DEC-31-1999 SEP-30-1999 215,542 585,055 84,046 0 1,476,276 2,461,995 100,259,101 (59,614,258) 46,177,840 1,127,986 6,238,955 0 0 12,494 32,453,387 46,177,840 4,166,456 5,456,283 5,312,369 6,822,962 0 0 115,358 (1,218,753) (244,000) (974,753) 0 0 0 (974,753) (0.08) (0.08)
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