-----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, LRhXw+gE39Thlsi4vOzve235cLW+S5tlKPCgtFylU8XHrCcrseTUfQ6knHr04YvL T2JWWHjbF/aa6gSkRRvmtA== 0001021408-01-510008.txt : 20020410 0001021408-01-510008.hdr.sgml : 20020410 ACCESSION NUMBER: 0001021408-01-510008 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011114 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: 1785460 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 d10qsb.txt FORM 10-QSB 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 September 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) (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 November 12, 2001 - -------------------------------------------------------------------------------- 1 URANIUM RESOURCES, INC. 2001 THIRD QUARTERLY REPORT ON FORM 10-QSB TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1. Financial Statements 3 September 30, 2001 (Unaudited) and December 31, 2000 3 Consolidated Statements of Operations - Three and Nine months Ended September 30, 2001 and 2000 (Unaudited) 5 Consolidated Statements of Cash Flows - Nine months Ended September 30, 2001 and 2000 (Unaudited) 6 Notes to Consolidated Financial Statements - September 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 13 Item 2. Changes in Securities and Use of Proceeds 13 Item 3. Defaults Upon Senior Securities 13 Item 4. Submission of Matters to a Vote of Security Holders 13 Item 5. Other Information 13 Item 6. Exhibits and Reports on Form 8-K. 13 SIGNATURES 14 Index to Exhibits E-1
2 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS URANIUM RESOURCES, INC. ----------------------- CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2001 AND DECEMBER 31, 2000 (NOTE 1) ------------------------------------------------- ASSETS
September 30, December 31, -------------- -------------- 2001 2000 -------------- -------------- (Unaudited) Current assets: Cash and cash equivalents $ 1,280,417 $ 212,523 Receivables, net 10,884 20,883 Materials and supplies inventory 67,775 69,598 Prepaid and other current assets 20,871 19,912 -------------- -------------- Total current assets 1,379,947 322,916 -------------- -------------- Property, plant and equipment, at cost: Uranium properties 99,889,689 99,532,193 Other property, plant and equipment 280,436 383,166 Less-accumulated depreciation and depletion (99,452,459) (99,141,105) -------------- -------------- Net property, plant and equipment 717,666 774,254 Long-term investment: Certificate of deposit, restricted 1,793,460 2,858,895 Other assets 4,299 4,299 -------------- -------------- $ 3,895,372 $ 3,960,364 ============== ==============
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 3 URANIUM RESOURCES, INC. ----------------------- CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2001 AND DECEMBER 31, 2000 (NOTE 1) ------------------------------------------------- LIABILITIES AND SHAREHOLDERS' DEFICIT
September 30, December 31, -------------- -------------- 2001 2000 -------------- -------------- (Unaudited) Current liabilities: Accounts payable $ 88,406 $ 199,183 Current portion of long-term debt -- 581 Current portion of restoration reserve 83,000 83,000 Other accrued liabilities 529,661 201,281 -------------- -------------- Total current liabilities 701,067 484,045 -------------- -------------- Other long-term liabilities and deferred credits 3,939,941 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 Accumulated deficit (51,669,586) (50,373,264) Less: Treasury stock (152,500 shares), at cost (9,418) (9,418) -------------- -------------- Total shareholders' deficit (1,330,636) (2,119,312) -------------- -------------- $ 3,895,372 $ 3,960,364 ============== ==============
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 4 URANIUM RESOURCES, INC. ----------------------- CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 (NOTE 1) (Unaudited)
Three Months Ended Nine Months Ended September 30, September 30, ---------------------------- ---------------------------- 2001 2000 2001 2000 ------------ ------------ ------------ ------------ Revenues: Uranium sales - Produced uranium $ -- $ -- $ -- $ 121,954 Purchased uranium -- -- -- 815,148 ------------ ------------ ------------ ------------ Uranium sales -- -- -- 937,102 Other uranium revenues -- -- -- 144,793 ------------ ------------ ------------ ------------ Total revenue -- -- -- 1,081,895 Costs and expenses: Cost of uranium sales - Direct cost of purchased uranium -- -- -- 799,850 Royalties -- -- -- 16,626 Operating expenses 19,746 32,877 42,114 650,056 Provision for restoration and reclamation costs -- -- -- 12,297 Depreciation and depletion 8,393 24,985 28,796 180,912 Writedown of uranium properties 158,296 195,463 357,730 470,186 ------------ ------------ ------------ ------------ Total cost of uranium sales 186,435 253,325 428,640 2,129,927 ------------ ------------ ------------ ------------ Loss from operations before corporate expenses (186,435) (253,325) (428,640) (1,048,032) Corporate expenses - General and administrative 281,917 343,682 900,833 1,157,961 Depreciation 2,916 6,483 11,814 18,039 ------------ ------------ ------------ ------------ Total corporate expenses 284,833 350,165 912,647 1,176,000 ------------ ------------ ------------ ------------ Loss from operations (471,268) (603,490) (1,341,287) (2,224,032) Other income (expense): Interest expense, net of capitalized interest (2,064) (32,510) (38,259) (86,252) Interest and other income, net 22,628 55,499 83,224 287,601 ------------ ------------ ------------ ------------ Total other income 20,564 22,989 44,965 201,349 ------------ ------------ ------------ ------------ Loss before federal income taxes (450,704) (580,501) (1,296,322) (2,022,683) Federal income tax benefit: Current -- -- -- -- Deferred -- -- -- -- ------------ ------------ ------------ ------------ Net loss $ (450,704) $ (580,501) $ (1,296,322) $ (2,022,683) ============ ============ ============ ============ Net loss per common share and common equivalent (basic and diluted) $ (0.01) $ (0.03) $ (0.03) $ (0.13) ============ ============ ============ ============ Weighted average common shares and common equivalent shares per share data Basic 48,992,278 18,451,670 39,428,923 15,519,974 ============ ============ ============ ============ Diluted 48,992,278 18,451,670 39,428,923 15,519,974 ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these consolidated statements. 5 URANIUM RESOURCES, INC. ----------------------- CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 (NOTE 1) (Unaudited)
September 30 ---------------------------------- 2001 2000 --------------- --------------- Cash flows from operations: Net loss $ (1,296,322) $ (2,022,683) Reconciliation of net loss to cash provided by operations- Provision for restoration and reclamation costs -- 12,297 Depreciation and depletion 40,610 198,951 Writedown of uranium properties 357,730 470,186 Decrease in restoration and reclamation accrual (1,174,502) (412,031) Other non-cash items, net 119,931 178,552 --------------- --------------- Cash flow used in operations, before changes in operating working capital items (1,952,553) (1,574,728) Effect of changes in operating working capital items- Decrease in receivables 9,999 1,134,088 Decrease in inventories 1,823 48,064 Increase in prepaid and other current assets (959) (1,614) Increase (decrease) in payables and accrued liabilities 217,603 (89,916) --------------- --------------- Net cash used in operations (1,724,087) (484,106) --------------- --------------- Investing activities: Decrease in investments 1,065,435 259,130 (Additions to) proceeds from property, plant and equipment - Kingsville Dome (92,769) 69,573 Rosita (45,744) (111,290) Vasquez (65,141) (40,043) Churchrock (33,353) (92,782) Crownpoint (100,711) 265,279 Other property (20,153) (17,015) --------------- --------------- Net cash provided by investing activities 707,564 332,852 --------------- --------------- Financing activities: Payments and refinancings of principal (581) (579,875) Proceeds from borrowings 250,000 -- Issuance of common stock and warrants, net 1,834,998 750,000 --------------- --------------- Net cash provided by financing activities 2,084,417 170,125 --------------- --------------- Net increase in cash and cash equivalents 1,067,894 18,871 Cash and cash equivalents, beginning of period 212,523 493,567 --------------- --------------- Cash and cash equivalents, end of period $ 1,280,417 $ 512,438 =============== ===============
The accompanying notes to financial statements are an integral part of these consolidated statements. 6 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 nine months ended September 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. All of the $2.2 million available under the agreement has been released to the Company through September 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. The Company is currently negotiating an extension of the agreement which would provide the Company access to approximately $1.4 million in funding to perform restoration activities in 2002. 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. 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 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 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 from the filing of its Annual Report on Form 10-K for 1999 with unaudited financial statements. The Company's common stock began trading on the Pink Sheets on November 14, 2000. On August 22, 2001 the Company met the compliance requirements of the OTC Bulletin Board and became eligible for quotation on the OTC Bulletin Board. 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 $1.835 million. 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 $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 has filed 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 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 nine months ended September 30, 2001 and 2000 was $0 and $61,000, respectively. Total interest costs in these periods were $38,000 and $147,000, respectively. 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. 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 2000, the Company raised $750,000 of equity by the issuance of 7.5 million shares of Common Stock at $0.10 per share to a group of private investors. The investors were also issued five-year warrants to purchase an aggregate of 5,475,000 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 provided 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 $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 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. Capital Resources and Liquidity Operating Cash Flows and Liquidity For the quarter ended September 30, 2001, the Company's cash and cash equivalents of $1,280,000 represented a decrease of $71,000 for the quarter. This compares to an increase of $16,000 for the third quarter of 2000. The Company's cash flow used in operations was $253,000 for the quarter ended September 30, 2001 and related primarily to restoration activities at the Company's South Texas locations. Cash flow used in operations in the same period in 2000 of $741,000. The Company's net working capital at September 30, 2001 was $678,000. 10 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 $2.244 million in funding. In 2000, the Company received $821,000 under the agreement and in the nine months ended September 30, 2001 the remaining $1.423 million was 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 nine months ending September 30, 2001, capitalized expenditures for land holding costs at the Company's South Texas locations totaled $204,000. 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 $154,000 for the nine months ending September 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 $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 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. 11 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 Nine months Ended September 30, 2001 and 2000 In the first quarter of 2000 the Company had revenues of $937,102 resulting from the sale of 13,000 pounds of produced uranium and 85,000 pounds of uranium purchased at $9.41 per pound. The Company has neither purchased nor sold any uranium since then and has no sales scheduled for the remainder of the year or beyond and also does not have any remaining inventory of uranium. Our cost of uranium sales in first nine months of 2001 was $429,000 compared to $2,130,000 in 2000. The largest single cost reduction came from the lack of uranium sales in the current year and the corresponding decrease in the cost of purchased uranium. Purchased uranium costs in the first quarter of 2000 totaled $799,850 and were zero in the same period of 2001. The cost of the produced uranium sold in 2000 totaled $112,900 and was made up of operating expenses of $42,111 depreciation and depletion cost of $58,782 and restoration charges of $12,007. The other significant cost reduction in the first nine months of 2001 compared to 2000 was the change in the Company's activities from a stand-by mode to full scale restoration in the third quarter of 2000. With the restoration agreement reached covering the 18 month period beginning July 1, 2000, virtually all activities occurring after that date in South Texas were directly related to the restoration process. As a result such costs incurred after July 1, 2000 were recorded as a reduction of the Company's restoration liability rather than an ongoing operations cost. Costs prior to that date were determined to be holding costs from the uranium facilities being held on stand-by. Stand-by costs recorded in the first nine months of 2000 totaled $730,000 ($608,00 to operations and $122,000 in depreciation) compared to $71,000 ($42,000 in operating costs and $29,000 in depreciation) for the same period in 2001. The Company incurred $358,000 in writedowns of its uranium properties in the nine months ended September 30, 2001 compared to $470,000 in the same period of 2000. The Company capitalizes expenditures related to non-restoration costs incurred to maintain and hold its properties and performs realizability tests each quarter to determine if their recorded values require adjustment. While uranium prices are below the costs projected to be needed to produce these properties, the costs capitalized during the quarter are written down to their net realizable value. The provision for restoration and reclamation in the first nine months ended September 30, 2001 was nil, compared to $12,000 for the same period in 2000. General and administrative expenses decreased to $913,000 in the nine months of 2001 from $1,176,000 in the nine months of 2000, reflecting the continued focus on reducing costs. 12 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS. None 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) 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) None 13 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 13, 2001 By: /s/ Paul K. Willmott ----------------------------- Paul K. Willmott Director, President and Chief Executive Officer Dated: November 13, 2001 By: /s/ Thomas H. Ehrlich ----------------------------- Thomas H. Ehrlich Vice President - Finance and Chief Financial Officer (Principal Financial and Accounting Officer) 14 EXHIBIT INDEX Exhibit Description Number 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). 3.1.1* 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). 3.1.2* Certificate Amendment to the Certificate of Incorporation dated March 23, 2001 (filed with the Company's Annual Report on Form 10-KA dated July 26, 2001). 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* 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-KA dated July 26, 2001). 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 Amended and restated 1995 Stock Incentive Plan. 10.4* Non-Qualified Stock Option Agreement dated June 19, 2000 between the Company and Leland O. Erdahl (filed with the Company's 10-QSB dated August 13, 2001). 10.5* Non-Qualified Stock Option Agreement dated June 19, 2000 between the Company and George R. Ireland (filed with the Company's 10-QSB dated August 13, 2001). Non-Qualified Stock Option Agreement dated June 19, 2000 between the Company and Rudolf J. Mueller (filed with the Company's 10-QSB dated August 13, 2001). 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). 10.9* License to Explore and Option to Purchase dated March 25, 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). 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 ___________________ * Not filed herewith. Incorporated by reference pursuant to Rule 12b-32 under the Securities and Exchange. E-1 Exhibit Description Number 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). 10.18* 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-KA dated July 26, 2001). 16* Letter on change in certifying accountant (filed with the Company's Current Report on Form 8-K dated February 21, 2001). ___________________ * Not filed herewith. Incorporated by reference pursuant to Rule 12b-32 under the Securities and Exchange. E-2 -----END PRIVACY-ENHANCED MESSAGE-----