10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2022

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 001-33404

WESTWATER RESOURCES, INC.

(Exact Name of Registrant as Specified in Its Charter)

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

6950 S. Potomac Street, Suite 300, Centennial, Colorado 80112

(Address of Principal Executive Offices, Including Zip Code)

(303) 531-0516

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.001 par value	WWR	NYSE American

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 ☒ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated Filer ☐	Accelerated Filer ☐
Non-accelerated Filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ 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	48,066,682 as of November 9, 2022

WESTWATER RESOURCES, INC.

TABLE OF CONTENTS

DEFINITIONS	3
PART I — FINANCIAL INFORMATION	5
ITEM 1. FINANCIAL STATEMENTS	5
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	22
ITEM 4. CONTROLS AND PROCEDURES	22
PART II - OTHER INFORMATION	23
ITEM 1. LEGAL PROCEEDINGS	23
ITEM 1A. RISK FACTORS	23
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	24
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	24
ITEM 4. MINE SAFETY DISCLOSURES	24
ITEM 5. OTHER INFORMATION	24
ITEM 6. EXHIBITS	25
SIGNATURES	26

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2

DEFINITIONS

When used in this Form 10-Q, the following terms have the meaning indicated.

Term	Meaning
Alabama Graphite	Alabama Graphite Company, Inc., an Alabama corporation and wholly owned subsidiary of Westwater Resources.
Annual Report	Westwater Resources, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2021.
AGP	Alabama Graphite Products, LLC, an Alabama limited liability company and wholly owned subsidiary of Westwater Resources.
ASC	FASB Accounting Standards Codification.
ASU	FASB Accounting Standards Update.
ATM Offering Agreement	Controlled Equity Offering Sale Agreement between Westwater Resources and Cantor Fitzgerald & Co. dated April 14, 2017.
Cantor	Cantor Fitzgerald & Co.
Coosa Graphite Deposit	The Company’s graphite mineral deposit located near Rockford, Alabama.
EU Critical Raw Minerals List	The list of raw materials that are crucial to the economy of the European Union published by the European Commission.
Inducement Plan	The Employment Inducement Incentive Award Plan. The Inducement Plan provides for the grant of equity-based awards, including restricted stock units, restricted stock, performance shares and performance units, and its terms are substantially similar to the Company’s 2013 Omnibus Incentive Plan.
Kellyton Graphite Plant	The Company’s planned battery-grade graphite processing facility near Kellyton, Alabama.
FASB	The Financial Accounting Standards Board.
graphite	A naturally occurring carbon material with electrical properties that enhance the performance of electrical storage batteries, listed on the U.S. Critical Minerals List and the EU Critical Raw Materials List.
Gross acres	Total acreage of land under which we have mineral rights. May include unleased fractional ownership.
Lincoln Park	Lincoln Park Capital Fund, LLC.
U.S. Critical Minerals List	The list of critical minerals that are crucial to the economy of the United States of America published by the Department of Interior.
vanadium	A rare-earth metal used as a strengthening alloy in steelmaking, and in certain types of batteries, listed on the U.S. Critical Minerals List.
Westwater Resources	Westwater Resources, Inc.
2020 Lincoln Park PA	Purchase Agreement dated as of December 4, 2020 between Westwater Resources and Lincoln Park Capital Fund, LLC.

USE OF NAMES

In this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms “we,” “us,” “our,” “WWR,” “Westwater,” “Westwater Resources,” or the “Company” refer to Westwater Resources, Inc. and its subsidiaries.

3

CURRENCY

The accounts of the Company are maintained in U.S. dollars. All dollar amounts referenced in this Quarterly Report on Form 10-Q and the consolidated financial statements are stated in U.S. dollars.

4

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(expressed in thousands of dollars, except share amounts)

(unaudited)

	September 30,		December 31,
	2022		2021
ASSETS
Current Assets:
Cash and cash equivalents	$	100,308	$	115,293
Prepaid and other current assets		516		320
Total Current Assets		100,824		115,613
Property, plant and equipment, at cost:
Property, plant and equipment		64,472		14,593
Less: Accumulated depreciation		(213)		(114)
Net property, plant and equipment		64,259		14,479
Operating lease right-of-use assets		122		226
Other long-term assets		—		2,665
Total Assets	$	165,205	$	132,983
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	18,521	$	3,043
Accrued liabilities		2,122		2,129
Operating lease liability, current		128		152
Total Current Liabilities		20,771		5,324
Operating lease liability, net of current		—		83
Other long-term liabilities		1,378		1,378
Total Liabilities		22,149		6,785
Commitments and Contingencies (see note 8)
Stockholders’ Equity:
Common stock, 100,000,000 shares authorized, $.001 par value
Issued shares - 48,066,843 and 35,279,724, respectively
Outstanding shares - 48,066,682 and 35,279,563, respectively		48		35
Paid-in capital		494,840		468,578
Accumulated deficit		(351,574)		(342,157)
Less: Treasury stock (161 shares), at cost		(258)		(258)
Total Stockholders’ Equity		143,056		126,198
Total Liabilities and Stockholders’ Equity	$	165,205	$	132,983

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(expressed in thousands of dollars, except share and per share amounts)

(unaudited)

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Operating Expenses:
Product development expenses	$	(257)	$	(1,834)	$	(857)	$	(5,766)
Exploration expenses		(235)		(348)		(644)		(877)
General and administrative expenses		(2,611)		(2,189)		(7,466)		(6,470)
Arbitration costs		—		(644)		(142)		(2,190)
Mineral property expenses		(11)		(94)		(18)		(94)
Depreciation and amortization		(43)		(1)		(99)		(3)
Total operating expenses		(3,157)		(5,110)		(9,226)		(15,400)
Non-Operating Income:
Unrealized gain on equity securities		—		507		—		1,918
Other (expense) income, net		(296)		35		(191)		44
Total other (expense) income		(296)		542		(191)		1,962
Net Loss	$	(3,453)	$	(4,568)	$	(9,417)	$	(13,438)
BASIC AND DILUTED LOSS PER SHARE	$	(0.07)	$	(0.13)	$	(0.21)	$	(0.42)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING		47,462,656		34,331,778		43,807,123		31,808,215

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(expressed in thousands of dollars)

(unaudited)

	For the Nine Months Ended September 30,
	2022		2021
Operating Activities:
Net loss	$	(9,417)	$	(13,438)
Reconciliation of net loss to cash used in operations:
Non-cash lease expense		(3)		(1)
Depreciation and amortization		99		3
Stock compensation expense		703		594
Unrealized gain on equity securities		—		(1,918)
Effect of changes in operating working capital items:
(Increase) decrease in prepaids and other assets		(196)		55
Increase in payables and accrued liabilities		225		1,665
Net Cash Used In Operating Activities		(8,589)		(13,040)
Cash Flows From Investing Activities:
Proceeds from PPP loan escrow		—		333
Building deposit		—		(245)
Capital expenditures		(31,968)		(119)
Net Cash Used In Investing Activities		(31,968)		(31)
Cash Flows From Financing Activities:
Issuance of common stock, net		25,604		81,865
Payment of minimum withholding taxes on net share settlements of equity awards		(32)		(150)
Net Cash Provided By Financing Activities		25,572		81,715
Net (decrease) increase in Cash, Cash Equivalents and Restricted Cash		(14,985)		68,644
Cash, Cash Equivalents and Restricted Cash, Beginning of Period		115,293		50,325
Cash, Cash Equivalents and Restricted Cash, End of Period	$	100,308	$	118,969
Supplemental Non-Cash Information with Respect to Investing and Financing Activities:
Accrued capital expenditures (at end of period)		16,028		—
Total Non-Cash Investing and Financing Activities for the Period	$	16,028	$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

7

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(expressed in thousands of dollars, except share amounts)

(unaudited)

Nine months ended September 30, 2022	Common Stock			Paid-In		Accumulated		Treasury
	Shares	Amount		Capital		Deficit		Stock		Total
Balances, December 31, 2021	35,279,724	$	35	$	468,578	$	(342,157)	$	(258)	$	126,198
Net loss	—		—		—		(9,417)		—		(9,417)
Common stock issued, net of issuance costs	12,619,147		13		25,591		—		—		25,604
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	167,972		—		703		—		—		703
Minimum withholding taxes on net share settlements of equity awards	—		—		(32)		—		—		(32)
Balances, September 30, 2022	48,066,843	$	48	$	494,840	$	(351,574)	$	(258)	$	143,056
Three months ended September 30, 2022
Balances, June 30, 2022	47,218,863	$	47	$	493,445	$	(348,121)	$	(258)	$	145,113
Net loss	—		—		—		(3,453)		—		(3,453)
Common stock issued, net of issuance costs	796,781		1		1,062		—		—		1,063
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	51,199		—		333		—		—		333
Balances, September 30, 2022	48,066,843	$	48	$	494,840	$	(351,574)	$	(258)	$	143,056
Nine months ended September 30, 2021	Common Stock			Paid-In		Accumulated		Treasury
	Shares	Amount		Capital		Deficit		Stock		Total
Balances, December 31, 2020	19,172,020	$	19	$	383,723	$	(326,013)	$	(258)	$	57,471
Net loss	—		—		—		(13,438)		—		(13,438)
Common stock issued, net of issuance costs	15,407,018		15		81,850		—		—		81,865
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	57,186		—		594		—		—		594
Minimum withholding taxes on net share settlements of equity awards	—		—		(150)		—		—		(150)
Balances, September 30, 2021	34,636,224	$	34	$	466,017	$	(339,451)	$	(258)	$	126,342
Three months ended September 30, 2021
Balances, June 30, 2021	33,536,476	$	33	$	461,717	$	(334,883)	$	(258)	$	126,609
Net loss	—		—		—		(4,568)		—		(4,568)
Common stock issued, net of issuance costs	1,099,748		1		4,001		—		—		4,002
Stock compensation expense and related share issuances, net of shares withheld for the payment of taxes	—		—		299		—		—		299
Balances, September 30, 2021	34,636,224	$	34	$	466,017	$	(339,451)	$	(258)	$	126,342

The accompanying notes are an integral part of these condensed consolidated financial statements.

8

WESTWATER RESOURCES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements for Westwater Resources, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  The accompanying statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021.  The interim condensed consolidated financial statements are unaudited. In the opinion of management, all adjustments (which are of a normal, recurring nature) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for any other period including the full year ending December 31, 2022.

Significant Accounting Policies

Our significant accounting policies are detailed in Note 1, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements within our Annual Report.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to estimate lifetime expected credit losses and recognize an allowance against the related instruments. For available for sale debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. The adoption of this update, if applicable, will result in earlier recognition of losses and impairments. ASU 2016-13 will be effective for interim and annual periods beginning after December 15, 2022.

In November 2018, the FASB issued ASU 2018-19, “Codification Improvements to ASC 326, Financial Instruments – Credit Losses”, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. ASU 2018-19 will be effective for interim and annual periods beginning after December 15, 2022.

The Company is currently evaluating ASU 2016-13 and ASU 2018-19 for the potential impact of adopting this guidance on its financial reporting.

2. LIQUIDITY

The Company last recorded revenues from operations in 2009. Since 2009, the Company has relied on equity financings, debt financings and asset sales to fund its operations. The Company expects to rely on debt and equity financings to fund its operations for the foreseeable future.

During the first nine months of 2022, the Company continued construction activities related to the Kellyton Graphite Plant. The Company also continued its exploration project to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit. Drilling was completed in April 2022 and the Company expects to complete a resource model by the end of the year 2022.

On September 30, 2022, the Company’s cash balance was approximately $100.3 million. During the nine months ended September 30, 2022, the Company sold 12.6 million shares of common stock for net proceeds of $25.6 million pursuant to the ATM Offering Agreement (see Note 4).

9

Management believes the Company’s current cash balance is sufficient to fund its planned non-discretionary expenditures through the fourth quarter of 2023. The Company has in place the ATM Offering Agreement and the 2020 Lincoln Park PA, both of which could be used to support construction of Phase I of the Kellyton Graphite Plant and the Company’s planned non-discretionary expenditures. While the Company has been successful in the past in raising funds through equity and debt financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Stock price volatility, rising interest rates, inflation and generally uncertain economic conditions could significantly impact the Company’s ability to raise funds through equity or debt financing. Further, market conditions, including but not limited to, inflation, labor shortages and supply chain disruptions could also adversely impact the planned cost and the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant.

Along with evaluating the continued use of the ATM Offering Agreement and the 2020 Lincoln Park PA, the Company is considering other forms of project financing to fund the construction of the Kellyton Graphite Plant, including both Phase I and Phase II. The alternative sources of project financing could include, but are not limited to, project debt, convertible debt, or pursuing a partnership or joint venture. If funds are not available to fund the construction of Phase I of the Kellyton Graphite Plant under the Company’s financing facilities or through alternative financing sources, the Company expects to be able to fund the Company’s non-discretionary expenditures with the Company’s current cash balance, however in such instance, the Company may be required to change its planned development strategies related to the Coosa Deposit and Phase I of the Kellyton Graphite Plant, including the construction and commissioning timeline of Phase I of the Kellyton Graphite Plan, or putting the construction of Phase I on hold until additional funding is obtained.

3. PROPERTY, PLANT AND EQUIPMENT

	Net Book Value of Property Plant and Equipment at September 30, 2022
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		5,755		26		5,781
Construction in progress		49,506		—		49,506
Total	$	64,233	$	26	$	64,259

	Net Book Value of Property Plant and Equipment at December 31, 2021
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		4,462		28		4,490
Construction in progress		1,017		—		1,017
Total	$	14,451	$	28	$	14,479

Construction in Progress

Construction in progress represents assets that are not ready for service or are in the construction stage. Assets are depreciated based on the estimated useful life of the asset once it is placed in service.

During the first quarter of 2022, the manufacturing of certain equipment commenced, for which the Company made cash deposits of $2.7 million as of December 31, 2021.  As such, the deposits as of December 31, 2021 are now reflected as construction in progress, and will continue to be included in construction in progress until such assets are placed into service.

10

Impairment of Property, Plant and Equipment

The Company reviews and evaluates its long-lived assets for impairment on an annual basis or more frequently when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. For the nine months ended September 30, 2022 no events or changes in circumstance are believed to have impacted recoverability of the Company’s long-lived assets. Accordingly, it was determined that no interim impairment was necessary.

4. COMMON STOCK

Common Stock Issued, Net of Issuance Costs

December 2020 Purchase Agreement with Lincoln Park Capital Fund, LLC

On December 4, 2020, the Company entered into the 2020 Lincoln Park PA with Lincoln Park to place up to either $100.0 million or 16.0 million shares in the aggregate of the Company's common stock on an ongoing basis over a term of 36 months. The Company controls the timing and amount of any sales to Lincoln Park, and Lincoln Park is obligated to make purchases in accordance with the 2020 Lincoln Park PA. Any common stock that is sold to Lincoln Park will occur at a purchase price that is based on an agreed upon fixed discount to the Company's prevailing market prices at the time of each sale and with no upper limits on the price Lincoln Park may pay to purchase common stock. The Lincoln Park PA may be terminated by the Company at any time, in its sole discretion, without any additional cost or penalty.

The 2020 Lincoln Park PA specifically provides that the Company may not issue or sell any shares of its common stock under the agreement if such issuance or sale would breach any applicable rules of the NYSE American Stock Exchange (“NYSE American”). In particular, NYSE American General Rule 713(a) provides that the Company may not issue or sell more than 19.99% of the number of shares of the Company’s common stock that were outstanding immediately prior to the execution of the 2020 Lincoln Park PA unless (i) shareholder approval is obtained or (ii) the average price of all applicable sales of common stock to Lincoln Park under the 2020 Lincoln Park PA, equals or exceeds $6.15. The Company held its 2021 Annual Shareholders Meeting on May 21, 2021 and obtained shareholder approval for the issuance of more than 19.99% of the shares of the Company’s common stock outstanding under the 2020 Lincoln Park PA.

Lincoln Park has no right to require the Company to sell any shares of common stock to Lincoln Park, but Lincoln Park is obligated to make purchases as the Company directs, subject to certain conditions. In all instances, the Company may not sell shares of its common stock to Lincoln Park under the 2020 Lincoln Park PA if it would result in Lincoln Park beneficially owning more than 9.99% of the Company’s common stock at any one point in time.

Since inception, the Company has sold 6.3 million shares of common stock to Lincoln Park pursuant to the 2020 Lincoln Park PA.

During the three and nine months ended September 30, 2022, the Company did not sell any shares of common stock pursuant to the 2020 Lincoln Park PA compared to 1.1 million and 6.1 million shares of common stock sold for net proceeds of $4.0 million and $34.6 million, respectively, for the three and nine months ended September 30, 2021.

Controlled Equity Offering Sales Agreement with Cantor Fitzgerald & Co.

On April 14, 2017, the Company entered into the ATM Offering Agreement with Cantor acting as the sales agent. Under the ATM Offering Agreement, the Company may from time to time sell shares of its common stock in “at-the-market” offerings. The Company pays Cantor a commission of up to 2.5% of the gross proceeds from the sale of any shares pursuant to the ATM Offering Agreement.

During the three and nine months ended September 30, 2022, the Company sold 0.8 million and 12.6 million shares of common stock for net proceeds of $1.1 million and $25.6 million, respectively, pursuant to the ATM Offering Agreement. During the nine months ended September 30, 2021, the Company sold 9.3 million shares of common stock

11

for net proceeds of  $47.3 million, pursuant to the ATM Offering Agreement.  The Company did not sell any shares of common stock pursuant to the ATM Offering Agreement for the three months ended September 30, 2021.  

Sales made under the ATM Offering Agreement are made pursuant to a prospectus supplement filed pursuant to Rule 424(b)(5), which registered for sale up to a total of $50.0 million of the Company’s common stock, which was filed on August 20, 2021 as a takedown off the Company’s shelf registration statement on Form S-3, which was declared effective by the Commission on July 8, 2021.  

As of September 30, 2022, the Company has received total gross proceeds of $28.8 million since inception under the ATM Offering Agreement.

5. STOCK-BASED COMPENSATION

Stock-based compensation awards consist of stock options, restricted stock units and bonus shares issued under the Company’s equity incentive plans, which include the 2013 Omnibus Incentive Plan (the “2013 Plan”) and the Amended and Restated 2004 Directors’ Stock Option and Restricted Stock Plan (the “2004 Directors’ Plan”). Upon approval of the 2013 Plan by the Company’s stockholders on June 4, 2013, the Company’s authority to grant new awards under all plans other than the 2013 Plan was terminated. On July 18, 2017, April 18, 2019, April 28, 2020, and May 21, 2021, the Company’s stockholders approved amendments to the 2013 Plan to increase the authorized number of shares of common stock available and reserved for issuance under the 2013 Plan by 20,000, 66,000, 350,000, and 1,500,000 shares, respectively, and in 2017 re-approved the material terms of the performance goals under the 2013 Plan. Under the 2013 Plan, the Company may grant awards of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), unrestricted stock, dividend equivalent rights, performance shares and other performance-based awards, other equity-based awards and cash bonus awards to eligible persons. Equity awards under the 2013 Plan are granted from time to time at the discretion of the Compensation Committee of the Board (the “Committee”), with vesting periods and other terms as determined by the Committee with a maximum term of 10 years. The 2013 Plan is administered by the Committee, which can delegate the administration to the Board, other committees or to such other officers and employees of the Company as designated by the Committee and permitted by the 2013 Plan.

As of September 30, 2022, shares available for future issuances under the 2013 Plan were 215,025. For the three and nine months ended September 30, 2022 the Company recorded stock-based compensation expense of $0.3 million and $0.7 million, respectively, compared to $0.3 million and $0.6 million, respectively, in the same periods in 2021. Stock compensation expense is recorded in general and administrative expenses.

In addition to the plans above, on May 9, 2022, the Board of Directors adopted the Inducement Plan and on May 13, 2022, the Company filed a registration statement on Form S-8 to register an aggregate of 250,000 shares of the Company’s common stock.  These shares may be issued pursuant to the Inducement Plan as equity awards to be granted for the sole purpose of recruiting and hiring new employees. No shares have been issued under the Inducement Plan as of September 30, 2022.  Subsequent to September 30, 2022, on October 4, 2022 the Company issued 58,946 restricted stock units under the Inducement Plan that vest over two years.

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Stock Options

Stock options are valued using the Black-Scholes option pricing model on the date of grant. The Company accounts for forfeitures upon occurrence.

The following tables summarize stock options outstanding and changes for the nine months ended September 30, 2022:

	September 30, 2022			September 30, 2021
		Weighted			Weighted
	Number of	Average		Number of	Average
	Stock	Exercise		Stock	Exercise
	Options	Price		Options	Price
Stock options outstanding at beginning of period	277,576	$	6.18	185,054	$	7.99
Granted	78,720		1.09	94,522		3.91
Expired	—		—	(2,000)		73.54
Stock options outstanding at end of period	356,296		5.06	277,576		6.18
Stock options exercisable at end of period	277,576	$	6.18	183,054	$	7.35

The weighted average remaining term for stock options outstanding as of September 30, 2022, is approximately 8.2 years.

The following table summarizes stock options outstanding and exercisable by stock option plan at September 30, 2022:

	Outstanding Stock Options			Exercisable Stock Options
	Number of	Weighted		Number of	Weighted
	Outstanding	Average		Stock Options	Average
Stock Option Plan	Stock Options	Exercise Price		Exercisable	Exercise Price
2004 Plan	92	$	1,638.00	92	$	1,638.00
2004 Directors’ Plan	3		10,380.00	3		10,380.00
2013 Plan	356,201		4.55	277,481		5.53
	356,296	$	5.06	277,576	$	6.18

As of September 30, 2022, the Company had less than $0.1 million of unrecognized compensation costs related to non-vested stock options that will be recognized over a period of approximately nine months.

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Restricted Stock Units

Time-based and performance-based RSUs are valued using the closing share price of the Company’s common stock on the date of grant. The final number of shares issued under performance-based RSUs is generally based on the Company’s prior year performance as determined by the Committee at each vesting date, and the valuation of such awards assumes full satisfaction of all performance criteria.

The following table summarizes RSU activity for the nine months ended September 30, 2022 and 2021:

	September 30,			September 30,
	2022			2021
		Weighted-			Weighted-
		Average			Average
	Number of	Grant Date		Number of	Grant Date
	RSUs	Fair Value		RSUs	Fair Value
Unvested RSUs at beginning of period	385,004	$	3.18	236,403	$	2.10
Granted	1,168,003		1.16	240,125		3.93
Forfeited/Expired	(225,091)		2.39	—		—
Vested	(181,991)		2.31	(78,801)		2.10
Unvested RSUs at end of period	1,145,925	$	1.42	397,727	$	3.20

As of September 30, 2022, the Company had $0.8 million of unrecognized compensation costs related to non-vested restricted stock units that will be recognized over a period of approximately 2.25 years.

6. OTHER (EXPENSE) INCOME, NET

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
(thousands of dollars)	2022		2021		2022		2021
Other (expense) income:
Foreign exchange loss		(649)		—		(645)		—
Interest income		352		8		453		18
Other income		1		27		1		26
Total other (expense) income, net	$	(296)	$	35	$	(191)	$	44

As of the three and nine months ended September 30, 2022, the Company recognized $0.6 million of foreign currency exchange loss related to our Euro denominated bank account.  As of September 30, 2022, the Company’s cash balance included approximately 9.5 million Euros. The foreign exchange loss was calculated using the exchange rate as of the balance sheet date.  A change in the Euro to USD exchange rate of $0.01 results in a foreign exchange adjustment of less than $0.1 million.

As of the three and nine months ended September 30, 2022, the Company recognized interest income of $0.4 million and $0.5 million, respectively, in our investment account.  

7. EARNINGS PER SHARE

Basic and diluted loss per common share have been calculated based on the weighted-average shares outstanding during the period. Additionally, potentially dilutive shares of 1,502,221 from the unvested RSUs and the outstanding stock options at the end of the period were excluded from the calculation of earnings per share because the effect on the basic income per share would be anti-dilutive, as the Company had a net loss for the three and nine months ended September 30, 2022.

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8. COMMITMENTS AND CONTINGENCIES

Future operations on the Company’s properties are subject to federal and state regulations for the protection of the environment, including air and water quality. The Company evaluates the status of current environmental laws and their potential impact on current operating costs and accrual for future costs. The Company believes its operations are materially compliant with current, applicable environmental regulations.

At any given time, the Company may enter into negotiations to settle outstanding legal proceedings and any resulting accruals will be estimated based on the relevant facts and circumstances applicable at that time. We do not expect that such settlements will, individually or in the aggregate, have a material effect on our financial position, results of operations or cash flows.

9. LEASES

The Company’s lease portfolio consists of an operating lease for the corporate office, storage space and equipment. The corporate office lease has a remaining lease term of 0.83 years and includes an option to extend the lease for 3 years. Under our corporate office lease, we are required to reimburse the lessor each month for common use expenses such as maintenance and security services. Because these amounts are variable from year to year and not specifically set in the lease terms, they are not included in the measurement of the right-of-use asset and related lease liability, but rather expensed in the period incurred.

The Company is party to several leases that have terms that are less than a year in length. These include leases for land used in exploration activities, office equipment, machinery, office space, storage and other. The Company has elected the short-term lease exemption allowed under the new leasing standards, whereby leases with initial terms of one year or less are not capitalized and instead expensed on a straight-line basis over the lease term. In addition, the Company holds several leases related to mineral exploration and production to which it has not applied the new leasing standard. Leases to explore or use minerals and similar nonregenerative resources are specifically excluded by ASC 842, “Leases.”

The right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities were recognized at the commencement date of the lease based on the present value of lease payments over the lease term using a discount rate of 9.5%. This rate is the Company’s estimated incremental borrowing rate at the lease commencement date.

The components of lease expense are as follows:

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Operating lease cost	$	115	$	115

Supplemental cash flow information related to the Company’s operating leases is as follows:

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Cash paid for amounts included in lease liabilities:
Operating cash flows from operating leases	$	119	$	115
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	122	$	258

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Supplemental balance sheet information related to the Company’s operating leases is as follows:

	September 30,		December 31,
(thousands of dollars)	2022		2021
Operating Leases
Operating lease right-of-use assets	$	122	$	226
Operating lease liability, current		128		152
Operating lease liabilities – long term portion		—		83
Total operating lease liabilities	$	128	$	235

Weighted-average remaining lease term and discount rate for the Company’s operating lease are as follows:

	For the Nine Months Ended
	September 30,
	2022		2021
Weighted Average Remaining Lease Term (in years)	0.8		1.8
Discount Rate	9.5	%	9.5	%

Maturities of lease liabilities for the Company’s operating leases are as follows:

Lease payments by year	September 30,
(in thousands)	2022
2022 (remainder of year)	$	40
2023		92
Total lease payments		132
Less imputed interest		(4)
Total	$	128

As of September 30, 2022, the Company has $0.1 million in right-of-use assets and $0.1 million in related lease liabilities, all of which is current. The most significant operating lease is for the Company’s corporate office in Centennial, Colorado, with $0.1 million remaining in undiscounted cash payments through the end of the lease term in 2023. The total undiscounted cash payments remaining on operating leases through the end of their respective terms is $0.1 million.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis of the consolidated financial results and condition of Westwater for the three and nine months ended September 30, 2022, has been prepared based on information available to us as of November 9, 2022. This discussion should be read in conjunction with the unaudited Condensed Consolidated Financial Statements and notes thereto included herewith and the audited Consolidated Financial Statements of Westwater for the period ended December 31, 2021 and the related notes thereto included in our Annual Report, which were prepared in accordance with U.S. GAAP. This management’s discussion and analysis contains forward-looking statements that are subject to risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those set forth elsewhere in this report. See “Cautionary Note Regarding Forward-Looking Statements” herein.

INTRODUCTION

Westwater Resources, Inc., originally incorporated in 1977, is a 45-year-old energy technology company focused on developing battery-grade natural graphite materials after its acquisition of Alabama Graphite in April 2018. Alabama Graphite holds mineral rights to explore and potentially mine the Coosa Graphite Deposit. During the first nine months of 2022, AGP continued construction activities related to Phase I of the Kellyton Graphite Plant and in April of 2022 Alabama Graphite completed the initial drilling stage of its exploration program to further investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit. The Coosa Graphite Deposit is located near Rockford, Alabama at 32 ° 54’ 30” North and 86 ° 24’ 00” West.

RECENT DEVELOPMENTS

Kellyton Graphite Plant – Construction Update

During the third quarter of 2022, the Company continued construction activities related to Phase I of its Kellyton Graphite Plant, including the completion of earthwork and site grading.  Construction activity during the third quarter also included receipt of more long-lead equipment components, and further work on underground utilities, foundations, and the manufacturing of plant buildings.

As previously announced, in April 2022, the Company completed the buildout of its Kellyton administrative offices, hosted a groundbreaking ceremony at the site of the Kellyton Graphite Plant, and selected a general contractor for the construction of the Kellyton Graphite Plant. In June 2022, the Company received its air permit from the Alabama Department of Environmental Management and consequently has all necessary permits to complete the construction of Phase I of the Kellyton Graphite Plant. The Company also applied for its wastewater disposal permit, which will be required before the Kellyton Graphite Plant commences operations. The Company has estimated the cost to construct and commission Phase I of the Kellyton Graphite Plant to be approximately $202 million, of which approximately $50.5 million has been incurred to date. Subject to global supply chain disruptions and challenges, and the Company’s ability to raise the remaining capital necessary to complete Phase I of the Kellyton Graphite Plant, the Company is targeting that it will begin testing and commissioning Phase I of the Kellyton Graphite Plant in mid-year 2023 and expects the testing and commissioning to continue in the second half of 2023.

Coosa Graphite Deposit – Exploration Program

The Company began an exploration project in April 2021 to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit.  In April 2022, the Company completed the drilling activity related to this exploration program and expects to complete a resource model by the end of the year 2022. The exploration program was conducted on approximately 4,000 acres out of a total of the approximately 41,965 acres for which Westwater holds mineral rights. In addition, as part of the resource model, vanadium mineralization is expected to be evaluated using extractive metallurgy techniques to ascertain the economic potential, if any, of the vanadium at the Coosa Graphite Deposit. Subject to its own definitive feasibility study, the availability and costs of financing, and regulatory approval, the Company anticipates that the mining operations related to the Coosa Graphite Deposit will commence by the end of 2028.

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Graphite and Vanadium as Critical Materials

Presently, the United States is almost 100% dependent on imports for battery-grade graphite, which is currently the primary anode material in the Lithium-ion batteries that power electric vehicles, smartphones, laptops, and store power generated from intermittent renewable energy sources. Westwater intends to process natural flake graphite into battery-grade graphite for all types of batteries including Lithium-ion batteries.

On March 31, 2022, President Biden invoked the Defense Production Act to encourage the domestic production of critical materials, including graphite, for advanced batteries for electric vehicles and clean energy storage.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act (“IRA”).  This legislation includes an investment of $369 billion in climate programs.  The IRA provides a 10% tax credit for the costs of producing certain critical minerals, including graphite and vanadium.  This credit is eligible for direct pay and is also transferable to unrelated taxpayers.  In addition, a key provision of the IRA that could indirectly benefit the Company is the Clean Vehicle credit.  Prior to the passage of the IRA, there was a limit placed on manufacturers once a manufacturer had sold at least 200,000 electric vehicles; however, the IRA eliminates the limitation on the number of electric vehicles a manufacturer can sell before the Clean Vehicle credit is phased out or eliminated.  Further, the IRA sets a minimum domestic content threshold for the percentage of the value of applicable critical minerals contained in the battery of the electric vehicles. As Westwater intends to produce battery grade graphite for lithium-ion batteries to be used in electric vehicles in the United States, management believes the domestic content requirement could provide indirect future benefit to the Company.

Westwater has and will continue to support the efforts by the relevant United States governmental agencies to ensure that they remain aware of the importance of natural battery-grade graphite, its importance to the nation’s security, and how the Kellyton Graphite Plant and the Coosa Graphite Deposit fit into the critical minerals-equation.

Equity Financings

Capital Raises during three and nine months ended September 30, 2022

During the three and nine months ended September 30, 2022 the Company sold 0.8 million and 12.6 million shares of common stock for net proceeds of $1.1 million and $25.6 million, respectively, pursuant to the ATM Offering Agreement, resulting in a cash balance of approximately $100.3 million at September 30, 2022.

See Note 4 to the financial statements for additional information.

RESULTS OF OPERATIONS

Summary

Our net loss for the three months ended September 30, 2022, was $3.5 million, or $0.07 per share, as compared with a net loss of $4.6 million, or $0.13 per share for the same period in 2021. The $1.1 million decrease in our net loss was due primarily to lower product development expenses, arbitration costs, and exploration expenses; offset partially by increases in general and administrative expenses, foreign exchange loss adjustment for our Euro denominated bank account and no unrealized gain on equity securities, which were sold in the fourth quarter of 2021.

Our net loss for the nine months ended September 30, 2022 was $9.4 million, or $0.21 per share, as compared with a net loss of $13.4 million, or $0.42 per share for the same period in 2021. The $4.0 million decrease in our net loss was due primarily to decreases in product development expenses, arbitration costs, and exploration expenses; offset partially by increases in general and administrative expenses, foreign exchange loss adjustment for our Euro denominated bank account and no unrealized gain on equity securities, which were sold in the fourth quarter of 2021.

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Product Development Expenses

Product development expenses for three and nine months ended September 30, 2022, were $0.3 million and $0.9 million, respectively, a decrease of $1.6 million and $4.9 million, respectively, compared to the same periods in 2021. Product development costs for the three and nine months ended September 30, 2022, primarily relate to continued product development, product optimization costs, and continued sample production of battery-grade natural graphite products for evaluation by potential customers. Product development costs in the comparable periods of 2021 were primarily comprised of expenses for our definitive feasibility study related to Phase I of the Kellyton Graphite Plant, which began in February 2021 and was completed in October 2021, and our graphite processing pilot program that was completed in 2021.

Arbitration Costs

During the three months and nine months ended September 30, 2022, arbitration costs decreased by $0.6 million and $2.0 million, respectively, compared to the same periods in 2021. The decrease in arbitration costs during the first three quarters of 2022 was due to lower legal fees related the Company’s request for Arbitration against the Republic of Turkey. During the first three quarters of 2021, the Company incurred legal fees for the hearing on substantive issues, which was conducted during the week of September 13-17, 2021. For further reference, see Part I, Item 3 of the Annual Report.

General and Administrative Expenses

General and administrative expenses for three and nine months ended September 30, 2022, increased by $0.4 million and $1.0 million, respectively, compared to the same periods in 2021. The increases are due primarily to increased personnel costs as the Company continues to build its team.

Exploration Expenses

Exploration expenses for the three and nine months ended September 30, 2022, decreased by $0.1 million and $0.2 million compared to the same periods in 2021.  The decrease for the three and nine month periods of 2022 compared to the same periods in 2021 is due primarily to the Company completing the drilling stage of its exploration program in April 2022.

Other Expenses

Other expenses for the three and nine months ended September 30, 2022, increased by $0.3 million and $0.2 million, respectively, compared to the same periods in 2021.  The increase for the three and nine month periods of 2022 compared to the same periods in 2021 is due primarily to foreign exchange loss adjustment of $0.6 million for our Euro denominated bank account; offset partially by interest income of $0.4 million on our investment account.  A change in the Euro to USD exchange rate of $0.01 results in a foreign exchange adjustment of less than $0.1 million.

FINANCIAL POSITION

Operating Activities

Net cash used in operating activities of $8.6 million for the nine months ended September 30, 2022, represents a decrease of $4.5 million compared to the same period in 2021. The decrease in cash used in operating activities was due primarily to decreases in product development expenses and arbitration costs; offset partially, by a foreign exchange loss on our Euro denominated bank account and higher general and administrative expenses as discussed in Results of Operations.

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Investing Activities

Net cash used in investing activities increased by $31.9 million for the nine months ended September 30, 2022, as compared to the same period in 2021. The increase was a result of capital expenditures related to the construction of Phase I of the Kellyton Graphite Plant, which began construction related activities in December 2021. The capital expenditures in the first nine months of 2022 primarily related to earthwork and site grading, progress payments related to long-lead equipment items, work on underground utilities and foundations, and detailed design engineering and project management activities.

Financing Activities

Net cash provided by financing activities was $25.6 million for the nine months ended September 30, 2022, due to sales of common stock through the Company’s ATM Offering Agreement. Net cash provided by financing activities for the same period in 2021 was $81.7 million. The $56.1 million decrease was due to lower sales activity under the 2020 Lincoln Park PA and the ATM Offering Agreement during the first nine months of 2022 compared to the same period in 2021.

LIQUIDITY AND CAPITAL RESOURCES

The Company last recorded revenues from operations in 2009. Since 2009, the Company has relied on equity financings, debt financings and asset sales to fund its operations. The Company expects to rely on debt and equity financing to fund its operations and business plan for the foreseeable future.

During the first nine months of 2022, the Company continued construction activities related to the Kellyton Graphite Plant. Subject to global supply chain disruptions and challenges, and the Company’s ability to raise the remaining capital necessary to complete Phase I of the Kellyton Graphite Plant, the Company is targeting that it will begin testing and commissioning of Phase I of the Kellyton Graphite Plant in mid-year 2023 and expects the testing and commissioning to continue in the second half of 2023.  Also during the first nine months of 2022, the Company continued its exploration project to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit. Drilling was completed in April 2022 and the Company expects to complete the resource model by the end of the year 2022.

On September 30, 2022, the Company’s cash balance was approximately $100.3 million inclusive of approximately 9.5 million Euros. The Company plans to use its Euro cash balance to pay for long lead equipment denominated in Euros.  During the three and nine months ended September 30, 2022, the Company sold 0.8 million and 12.6 million shares of common stock for net proceeds of $1.1 million and $25.6 million, respectively, pursuant to the ATM Offering Agreement. As of September 30, 2022, the Company has $21.2 million remaining available for future sales under the ATM Offering Agreement and has 9.7 million shares of common stock available for future sales pursuant to the 2020 Lincoln Park PA.

Management believes the Company’s current cash balance is sufficient to fund its planned non-discretionary expenditures through the fourth quarter of 2023. The Company has in place the ATM Offering Agreement and the 2020 Lincoln Park PA, both of which could be used to support construction of Phase I of the Kellyton Graphite Plant and the Company’s planned non-discretionary expenditures.  While the Company has been successful in the past in raising funds through equity and debt financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Stock price volatility, rising interest rates, inflation and generally uncertain economic conditions could significantly impact the Company’s ability to raise funds through equity or debt financing. Further, market conditions, including but not limited to, inflation, labor shortages and supply chain disruptions could adversely impact the planned cost and the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant.

Along with evaluating the continued use of the ATM Offering Agreement and the 2020 Lincoln Park PA, the Company is considering other forms of project financing to fund the construction of the Kellyton Graphite Plant, including both Phase I and Phase II. The alternative sources of project financing could include, but are not limited to, project debt, convertible debt, or pursuing a partnership or joint venture. If funds are not available to fund the construction of Phase I

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of the Kellyton Graphite Plant under the Company’s financing facilities or through alternative financing sources, the Company expects to be able to fund its non-discretionary expenditures with the Company’s current cash balance, however in such instance, the Company may be required to change its planned business development strategies related to the Coosa Deposit and Phase I of the Kellyton Graphite Plant, including the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant, or putting the construction of Phase I on hold until additional funding is obtained.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

With the exception of historical matters, the matters discussed in this report are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding the adequacy of funding, liquidity, access to capital, financing activities, the timing or occurrence of any future drilling or production from the Company’s properties, economic conditions, the strategic goals of the business, arbitration matters, costs of Phase I of the Kellyton Graphite Plant and estimated construction and commissioning timeline and completion date, the outcome of the feasibility study and start date for the mining of the Coosa Graphite Deposit, and the Company’s anticipated cash burn rate and capital requirements. Words such as “may,” “could,” “should,” “would,” “believe,” “estimate,” “expect,” “anticipate,” “plan,” “forecast,” “potential,” “intend,” “continue,” “project,” “target” and variations of these words, comparable words and similar expressions generally indicate forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Actual results may differ materially from those expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, among others:

● the spot price and long-term contract price of graphite (both flake graphite feedstock and purified graphite products) and vanadium, and the world-wide supply and demand of graphite and vanadium;

● the effects, extent and timing of the entry of additional competition in the markets in which we operate;

● our ability to obtain contracts with customers;

● available sources and transportation of graphite feedstock;

● the ability to control costs and avoid cost and schedule overruns during the development, construction and operation of the Kellyton Graphite Plant;

● the ability to construct and operate the Kellyton Graphite Plant in accordance with the requirements of permits and licenses and the requirements of tax credits and other incentives;

● the effects of inflation, including labor shortages and supply chain disruptions;

● rising interest rates and the associated impact on the availability and cost of financing sources;

● the availability and supply of equipment and materials needed to construct the Kellyton Graphite Plant;

● stock price volatility;

● government regulation of the mining and processing industries in the United States;

● unanticipated geological, processing, regulatory and legal or other problems we may encounter;

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● the results of our exploration activities, and the possibility that future exploration results may be materially less promising than initial exploration results;

● any graphite or vanadium discoveries not being in high enough concentration to make it economic to extract the metals;

● our ability to finance growth plans;

● the potential effects of the continued COVID-19 pandemic;

● currently pending or new litigation or arbitration; and

● our ability to maintain and timely receive mining and other permits from regulatory agencies.

In addition, other factors are described in our Annual Report, and the other reports we file with the SEC. Most of these factors are beyond our ability to predict or control. Future events and actual results could differ materially from those set forth herein, contemplated by or underlying the forward-looking statements. Forward-looking statements speak only as of the date on which they are made. We disclaim any obligation to update any forward-looking statements made herein, except as required by law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a smaller reporting company, we are not required to provide this information in our Quarterly Reports.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its filings with the Securities and Exchange Commission (“SEC”) is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management has recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating the Company’s controls and procedures.

During the fiscal period covered by this report, the Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of September 30, 2022.

Changes in Internal Controls

There were no changes in our internal control over financial reporting during the nine months ended September 30, 2022 that materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Information regarding reportable legal proceedings is contained in Part I, Item 3, “Legal Proceedings,” in our Annual Report. There have been no material changes to the legal proceedings previously disclosed in the Annual Report.

ITEM 1A. RISK FACTORS.

An investment in our common stock involves various risks.  When considering an investment in us, careful consideration should be given to the risk factors discussed in “Risk Factors” in Item 1A in our Annual Report.  There are no material changes to the risk factors described in our Annual Report, except as follows:

Our business could be negatively impacted by inflationary pressures, which may result in increased costs of operations and negatively impact the securities markets generally, which could have a material adverse effect on our ability to access capital.

The U.S. has experienced rising inflation in 2022 and U.S. inflation is currently at a 40-year high. A sustained increase in inflation may continue to raise our costs for labor, services, and materials. Further, our suppliers face inflationary impacts such as the tight labor market and supply chain disruptions, that could increase the costs to construct and commission the Kellyton Graphite Plant, explore and develop the Coosa Graphite Deposit, and our day to day operations. The rate and scope of these various inflationary factors may increase our operating costs materially, which may not be readily recoverable, and have an adverse effect on our costs, operating margins, results of operations and financial condition.

Further, sustained inflation has caused and may continue to cause the Federal Reserve Board to raise the target for the federal funds rate, which correspondingly increases interest rates.  Increased interest rates could have a negative effect on the securities markets generally which may, in turn, have a material adverse effect on the Company’s ability to access capital, particularly debt financing, and the market price of equity securities, including the Company’s common stock, which usually decrease as interest rates rise.  To the extent that we access debt financing or issue variable interest rate instruments in the future, any increase in interest rates would increase our cost of borrowing and our interest expense.

We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability, an ongoing military conflict between Russia and Ukraine, and record inflation. Our business, financial condition and results of operations could be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine, geopolitical tensions, or record inflation.

In February of 2022, Russian military forces invaded Ukraine, and sustained conflict and disruption in the region is likely. Although the length, impact and outcome of the ongoing military conflict in Ukraine is highly unpredictable, this conflict could lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, instability in financial markets, higher inflation, supply chain interruptions, political and social instability, changes in consumer or purchaser preferences as well as increase in cyberattacks and espionage. We are continuing to monitor the conflict and assessing its potential impact on our business.

The extent and duration of the military action or future escalation of such hostilities, the extent and impact of existing and future sanctions, market disruptions and volatility, and the result of any diplomatic negotiations cannot be predicted. While we expect any direct impacts to our business to be limited, the indirect impacts on the economy and on the mining industry and other industries in general could negatively affect our business and may make it more difficult for us to raise equity or debt financing. In addition, the impact of other current macro-economic factors on our business, which may be exacerbated by the war in Ukraine - including inflation, supply chain constraints and geopolitical events - is likely to have an adverse effect on our business

.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

ITEM 4. MINE SAFETY DISCLOSURES.

ITEM 5. OTHER INFORMATION.

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ITEM 6. EXHIBITS.

Exhibit Number	Description
3.1	Restated Certificate of Incorporation of the Company, as amended through April 22, 2019 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019).
3.2	Amended and Restated Bylaws of the Company, as amended August 21, 2017 (incorporated by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2017).
10.1*	Employment Agreement, effective August 26, 2022, between the Company and Steven M. Cates (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 20, 2022)
10.2*	Agreement and Release, effective August 26, 2022, between the Company and Jeffrey L. Vigil (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 20, 2022)
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS:	Inline XBRL Instance Document
101.SCH:	Inline XBRL Taxonomy Extension Schema Document
101.CAL:	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF:	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB:	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE:	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Indicates management contract or compensatory plan or arrangement.

25

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.

	WESTWATER RESOURCES, INC.
Dated: November 9, 2022	By:	/s/ Chad M. Potter
		Chad M. Potter
		President and Chief Executive Officer (Principal Executive Officer)
Dated: November 9, 2022	By:	/s/ Steven M. Cates
		Steven M. Cates
		Vice President - Finance and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

26

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Chad M. Potter, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Westwater Resources, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

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

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

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

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

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

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

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

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2022

/s/ Chad M. Potter

Title: President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Steven M Cates, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Westwater Resources, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

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

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

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

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

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

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

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

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 9, 2022

/s/ Steven M. Cates

Title: Vice President - Finance and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Chad M. Potter, President and Chief Executive Officer of Westwater Resources, Inc. (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended September 30, 2022 (the “Report”), which this certification accompanies, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

/s/ Chad M. Potter

Chad M. Potter

President and Chief Executive Officer

November 9, 2022

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Steven M. Cates, Vice President - Finance and Chief Financial Officer of Westwater Resources, Inc. (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended September 30, 2022 (the “Report”), which this certification accompanies, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

/s/ Steven M. Cates

Steven M. Cates

Vice President - Finance and Chief Financial Officer

November 9, 2022

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2022	Nov. 09, 2022
Document And Entity Information
Document Type	10-Q
Document Transition Report	false
Document Quarterly Report	true
Entity File Number	001-33404
Document Period End Date	Sep. 30, 2022
Entity Registrant Name	WESTWATER RESOURCES, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	75-2212772
Entity Address, Address Line One	6950 S. Potomac Street, Suite 300
Entity Address, City or Town	Centennial
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80112
City Area Code	303
Local Phone Number	531-0516
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	WWR
Security Exchange Name	NYSEAMER
Entity's Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		48,066,682
Entity Central Index Key	0000839470
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current Assets:
Cash and cash equivalents	$ 100,308	$ 115,293
Prepaid and other current assets	516	320
Total Current Assets	100,824	115,613
Property, plant and equipment, at cost:
Property, plant and equipment	64,472	14,593
Less: Accumulated depreciation	(213)	(114)
Net property, plant and equipment	64,259	14,479
Operating lease right-of-use assets	122	226
Other long-term assets		2,665
Total Assets	165,205	132,983
Current Liabilities:
Accounts payable	18,521	3,043
Accrued liabilities	2,122	2,129
Operating lease liability - current	128	152
Total Current Liabilities	20,771	5,324
Operating lease liability, net of current		83
Other long-term liabilities	1,378	1,378
Total Liabilities	22,149	6,785
Commitments and Contingencies (see note 8)
Stockholders' Equity:
Common stock, 100,000,000 shares authorized, $.001 par value; Issued shares - 48,066,843 and 35,279,724 respectively Outstanding shares - 48,066,682 and 35,279,563 respectively	48	35
Paid-in capital	494,840	468,578
Accumulated deficit	(351,574)	(342,157)
Less: Treasury stock (161 shares), at cost	(258)	(258)
Total Stockholders' Equity	143,056	126,198
Total Liabilities and Stockholders' Equity	$ 165,205	$ 132,983

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
CONDENSED CONSOLIDATED BALANCE SHEETS
Common stock, shares authorized	100,000,000	100,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares issued	48,066,843	35,279,724
Common stock, shares outstanding	48,066,682	35,279,563
Treasury stock, shares	161	161

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Operating Expenses:
Product development expenses	$ (257)	$ (1,834)	$ (857)	$ (5,766)
Exploration expenses	(235)	(348)	(644)	(877)
General and administrative expenses	(2,611)	(2,189)	(7,466)	(6,470)
Arbitration costs		(644)	(142)	(2,190)
Mineral property expenses	(11)	(94)	(18)	(94)
Depreciation and amortization	(43)	(1)	(99)	(3)
Total operating expenses	(3,157)	(5,110)	(9,226)	(15,400)
Non-Operating Income:
Unrealized gain on equity securities		507		1,918
Other (expense) income, net	(296)	35	(191)	44
Total other income	(296)	542	(191)	1,962
Net Loss	$ (3,453)	$ (4,568)	$ (9,417)	$ (13,438)
BASIC AND DILUTED LOSS PER SHARE
LOSS PER SHARE, BASIC	$ (0.07)	$ (0.13)	$ (0.21)	$ (0.42)
LOSS PER SHARE, DILUTED	$ (0.07)	$ (0.13)	$ (0.21)	$ (0.42)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC	47,462,656	34,331,778	43,807,123	31,808,215
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, DILUTED	47,462,656	34,331,778	43,807,123	31,808,215

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating Activities:
Net Loss	$ (9,417)	$ (13,438)
Reconciliation of net loss to cash used in operations:
Non-cash lease expense	(3)	(1)
Depreciation and amortization	99	3
Stock compensation expense	703	594
Unrealized gain on equity securities		(1,918)
Effect of changes in operating working capital items:
(Increase) decrease in prepaids and other assets	(196)	55
Increase in payables and accrued liabilities	225	1,665
Net Cash Used In Operating Activities	(8,589)	(13,040)
Cash Flows From Investing Activities:
Proceeds from PPP loan escrow		333
Building deposit		(245)
Capital expenditures	(31,968)	(119)
Net Cash Used In Investing Activities	(31,968)	(31)
Cash Flows From Financing Activities:
Issuance of common stock, net	25,604	81,865
Payment of minimum withholding taxes on net share settlements of equity awards	(32)	(150)
Net Cash Provided By Financing Activities	25,572	81,715
Net (decrease) increase in Cash, Cash Equivalents and Restricted Cash	(14,985)	68,644
Cash, Cash Equivalents and Restricted Cash, Beginning of Period	115,293	50,325
Cash, Cash Equivalents and Restricted Cash, End of Period	100,308	$ 118,969
Supplemental Non-Cash Information with Respect to Investing and Financing Activities:
Accrued capital expenditures (at end of period)	16,028
Total Non-Cash Investing and Financing Activities for the Period	$ 16,028

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Paid-In Capital	Accumulated Deficit	Treasury Stock	Total
Balance at Dec. 31, 2020	$ 19	$ 383,723	$ (326,013)	$ (258)	$ 57,471
Balance, shares at Dec. 31, 2020	19,172,020
Net loss			(13,438)		(13,438)
Common stock issued, net of issuance costs	$ 15	81,850			81,865
Common stock issued, net of issuance costs (in shares)	15,407,018
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes		594			594
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes (in shares)	57,186
Minimum withholding taxes on net share settlements of equity awards		(150)			(150)
Balance at Sep. 30, 2021	$ 34	466,017	(339,451)	(258)	126,342
Balance, shares at Sep. 30, 2021	34,636,224
Balance at Jun. 30, 2021	$ 33	461,717	(334,883)	(258)	126,609
Balance, shares at Jun. 30, 2021	33,536,476
Net loss			(4,568)		(4,568)
Common stock issued, net of issuance costs	$ 1	4,001			4,002
Common stock issued, net of issuance costs (in shares)	1,099,748
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes		299			299
Balance at Sep. 30, 2021	$ 34	466,017	(339,451)	(258)	126,342
Balance, shares at Sep. 30, 2021	34,636,224
Balance at Dec. 31, 2021	$ 35	468,578	(342,157)	(258)	126,198
Balance, shares at Dec. 31, 2021	35,279,724
Net loss			(9,417)		(9,417)
Common stock issued, net of issuance costs	$ 13	25,591			25,604
Common stock issued, net of issuance costs (in shares)	12,619,147
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes		703			703
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes (in shares)	167,972
Minimum withholding taxes on net share settlements of equity awards		(32)			(32)
Balance at Sep. 30, 2022	$ 48	494,840	(351,574)	(258)	143,056
Balance, shares at Sep. 30, 2022	48,066,843
Balance at Jun. 30, 2022	$ 47	493,445	(348,121)	(258)	145,113
Balance, shares at Jun. 30, 2022	47,218,863
Net loss			(3,453)		(3,453)
Common stock issued, net of issuance costs	$ 1	1,062			1,063
Common stock issued, net of issuance costs (in shares)	796,781
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes		333			333
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes (in shares)	51,199
Balance at Sep. 30, 2022	$ 48	$ 494,840	$ (351,574)	$ (258)	$ 143,056
Balance, shares at Sep. 30, 2022	48,066,843

XML

BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2022

BASIS OF PRESENTATION

BASIS OF PRESENTATION

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements for Westwater Resources, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  The accompanying statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021.  The interim condensed consolidated financial statements are unaudited. In the opinion of management, all adjustments (which are of a normal, recurring nature) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for any other period including the full year ending December 31, 2022.

Significant Accounting Policies

Our significant accounting policies are detailed in Note 1, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements within our Annual Report.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to estimate lifetime expected credit losses and recognize an allowance against the related instruments. For available for sale debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. The adoption of this update, if applicable, will result in earlier recognition of losses and impairments. ASU 2016-13 will be effective for interim and annual periods beginning after December 15, 2022.

In November 2018, the FASB issued ASU 2018-19, “Codification Improvements to ASC 326, Financial Instruments – Credit Losses”, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. ASU 2018-19 will be effective for interim and annual periods beginning after December 15, 2022.

The Company is currently evaluating ASU 2016-13 and ASU 2018-19 for the potential impact of adopting this guidance on its financial reporting.

XML

LIQUIDITY

9 Months Ended

Sep. 30, 2022

LIQUIDITY

LIQUIDITY

2. LIQUIDITY

The Company last recorded revenues from operations in 2009. Since 2009, the Company has relied on equity financings, debt financings and asset sales to fund its operations. The Company expects to rely on debt and equity financings to fund its operations for the foreseeable future.

During the first nine months of 2022, the Company continued construction activities related to the Kellyton Graphite Plant. The Company also continued its exploration project to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit. Drilling was completed in April 2022 and the Company expects to complete a resource model by the end of the year 2022.

On September 30, 2022, the Company’s cash balance was approximately $100.3 million. During the nine months ended September 30, 2022, the Company sold 12.6 million shares of common stock for net proceeds of $25.6 million pursuant to the ATM Offering Agreement (see Note 4).

Management believes the Company’s current cash balance is sufficient to fund its planned non-discretionary expenditures through the fourth quarter of 2023. The Company has in place the ATM Offering Agreement and the 2020 Lincoln Park PA, both of which could be used to support construction of Phase I of the Kellyton Graphite Plant and the Company’s planned non-discretionary expenditures. While the Company has been successful in the past in raising funds through equity and debt financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Stock price volatility, rising interest rates, inflation and generally uncertain economic conditions could significantly impact the Company’s ability to raise funds through equity or debt financing. Further, market conditions, including but not limited to, inflation, labor shortages and supply chain disruptions could also adversely impact the planned cost and the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant.

Along with evaluating the continued use of the ATM Offering Agreement and the 2020 Lincoln Park PA, the Company is considering other forms of project financing to fund the construction of the Kellyton Graphite Plant, including both Phase I and Phase II. The alternative sources of project financing could include, but are not limited to, project debt, convertible debt, or pursuing a partnership or joint venture. If funds are not available to fund the construction of Phase I of the Kellyton Graphite Plant under the Company’s financing facilities or through alternative financing sources, the Company expects to be able to fund the Company’s non-discretionary expenditures with the Company’s current cash balance, however in such instance, the Company may be required to change its planned development strategies related to the Coosa Deposit and Phase I of the Kellyton Graphite Plant, including the construction and commissioning timeline of Phase I of the Kellyton Graphite Plan, or putting the construction of Phase I on hold until additional funding is obtained.

XML

PROPERTY, PLANT AND EQUIPMENT

9 Months Ended

Sep. 30, 2022

PROPERTY, PLANT AND EQUIPMENT.

PROPERTY, PLANT AND EQUIPMENT

3. PROPERTY, PLANT AND EQUIPMENT

	Net Book Value of Property Plant and Equipment at September 30, 2022
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		5,755		26		5,781
Construction in progress		49,506		—		49,506
Total	$	64,233	$	26	$	64,259

	Net Book Value of Property Plant and Equipment at December 31, 2021
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		4,462		28		4,490
Construction in progress		1,017		—		1,017
Total	$	14,451	$	28	$	14,479

Construction in Progress

Construction in progress represents assets that are not ready for service or are in the construction stage. Assets are depreciated based on the estimated useful life of the asset once it is placed in service.

During the first quarter of 2022, the manufacturing of certain equipment commenced, for which the Company made cash deposits of $2.7 million as of December 31, 2021.  As such, the deposits as of December 31, 2021 are now reflected as construction in progress, and will continue to be included in construction in progress until such assets are placed into service.

Impairment of Property, Plant and Equipment

The Company reviews and evaluates its long-lived assets for impairment on an annual basis or more frequently when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. For the nine months ended September 30, 2022 no events or changes in circumstance are believed to have impacted recoverability of the Company’s long-lived assets. Accordingly, it was determined that no interim impairment was necessary.

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COMMON STOCK

9 Months Ended

Sep. 30, 2022

COMMON STOCK [Abstract]

COMMON STOCK

4. COMMON STOCK

Common Stock Issued, Net of Issuance Costs

December 2020 Purchase Agreement with Lincoln Park Capital Fund, LLC

On December 4, 2020, the Company entered into the 2020 Lincoln Park PA with Lincoln Park to place up to either $100.0 million or 16.0 million shares in the aggregate of the Company's common stock on an ongoing basis over a term of 36 months. The Company controls the timing and amount of any sales to Lincoln Park, and Lincoln Park is obligated to make purchases in accordance with the 2020 Lincoln Park PA. Any common stock that is sold to Lincoln Park will occur at a purchase price that is based on an agreed upon fixed discount to the Company's prevailing market prices at the time of each sale and with no upper limits on the price Lincoln Park may pay to purchase common stock. The Lincoln Park PA may be terminated by the Company at any time, in its sole discretion, without any additional cost or penalty.

The 2020 Lincoln Park PA specifically provides that the Company may not issue or sell any shares of its common stock under the agreement if such issuance or sale would breach any applicable rules of the NYSE American Stock Exchange (“NYSE American”). In particular, NYSE American General Rule 713(a) provides that the Company may not issue or sell more than 19.99% of the number of shares of the Company’s common stock that were outstanding immediately prior to the execution of the 2020 Lincoln Park PA unless (i) shareholder approval is obtained or (ii) the average price of all applicable sales of common stock to Lincoln Park under the 2020 Lincoln Park PA, equals or exceeds $6.15. The Company held its 2021 Annual Shareholders Meeting on May 21, 2021 and obtained shareholder approval for the issuance of more than 19.99% of the shares of the Company’s common stock outstanding under the 2020 Lincoln Park PA.

Lincoln Park has no right to require the Company to sell any shares of common stock to Lincoln Park, but Lincoln Park is obligated to make purchases as the Company directs, subject to certain conditions. In all instances, the Company may not sell shares of its common stock to Lincoln Park under the 2020 Lincoln Park PA if it would result in Lincoln Park beneficially owning more than 9.99% of the Company’s common stock at any one point in time.

Since inception, the Company has sold 6.3 million shares of common stock to Lincoln Park pursuant to the 2020 Lincoln Park PA.

During the three and nine months ended September 30, 2022, the Company did not sell any shares of common stock pursuant to the 2020 Lincoln Park PA compared to 1.1 million and 6.1 million shares of common stock sold for net proceeds of $4.0 million and $34.6 million, respectively, for the three and nine months ended September 30, 2021.

Controlled Equity Offering Sales Agreement with Cantor Fitzgerald & Co.

On April 14, 2017, the Company entered into the ATM Offering Agreement with Cantor acting as the sales agent. Under the ATM Offering Agreement, the Company may from time to time sell shares of its common stock in “at-the-market” offerings. The Company pays Cantor a commission of up to 2.5% of the gross proceeds from the sale of any shares pursuant to the ATM Offering Agreement.

During the three and nine months ended September 30, 2022, the Company sold 0.8 million and 12.6 million shares of common stock for net proceeds of $1.1 million and $25.6 million, respectively, pursuant to the ATM Offering Agreement. During the nine months ended September 30, 2021, the Company sold 9.3 million shares of common stock

for net proceeds of  $47.3 million, pursuant to the ATM Offering Agreement.  The Company did not sell any shares of common stock pursuant to the ATM Offering Agreement for the three months ended September 30, 2021.  

Sales made under the ATM Offering Agreement are made pursuant to a prospectus supplement filed pursuant to Rule 424(b)(5), which registered for sale up to a total of $50.0 million of the Company’s common stock, which was filed on August 20, 2021 as a takedown off the Company’s shelf registration statement on Form S-3, which was declared effective by the Commission on July 8, 2021.  

As of September 30, 2022, the Company has received total gross proceeds of $28.8 million since inception under the ATM Offering Agreement.

XML

STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2022

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

5. STOCK-BASED COMPENSATION

Stock-based compensation awards consist of stock options, restricted stock units and bonus shares issued under the Company’s equity incentive plans, which include the 2013 Omnibus Incentive Plan (the “2013 Plan”) and the Amended and Restated 2004 Directors’ Stock Option and Restricted Stock Plan (the “2004 Directors’ Plan”). Upon approval of the 2013 Plan by the Company’s stockholders on June 4, 2013, the Company’s authority to grant new awards under all plans other than the 2013 Plan was terminated. On July 18, 2017, April 18, 2019, April 28, 2020, and May 21, 2021, the Company’s stockholders approved amendments to the 2013 Plan to increase the authorized number of shares of common stock available and reserved for issuance under the 2013 Plan by 20,000, 66,000, 350,000, and 1,500,000 shares, respectively, and in 2017 re-approved the material terms of the performance goals under the 2013 Plan. Under the 2013 Plan, the Company may grant awards of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), unrestricted stock, dividend equivalent rights, performance shares and other performance-based awards, other equity-based awards and cash bonus awards to eligible persons. Equity awards under the 2013 Plan are granted from time to time at the discretion of the Compensation Committee of the Board (the “Committee”), with vesting periods and other terms as determined by the Committee with a maximum term of 10 years. The 2013 Plan is administered by the Committee, which can delegate the administration to the Board, other committees or to such other officers and employees of the Company as designated by the Committee and permitted by the 2013 Plan.

As of September 30, 2022, shares available for future issuances under the 2013 Plan were 215,025. For the three and nine months ended September 30, 2022 the Company recorded stock-based compensation expense of $0.3 million and $0.7 million, respectively, compared to $0.3 million and $0.6 million, respectively, in the same periods in 2021. Stock compensation expense is recorded in general and administrative expenses.

In addition to the plans above, on May 9, 2022, the Board of Directors adopted the Inducement Plan and on May 13, 2022, the Company filed a registration statement on Form S-8 to register an aggregate of 250,000 shares of the Company’s common stock.  These shares may be issued pursuant to the Inducement Plan as equity awards to be granted for the sole purpose of recruiting and hiring new employees. No shares have been issued under the Inducement Plan as of September 30, 2022.  Subsequent to September 30, 2022, on October 4, 2022 the Company issued 58,946 restricted stock units under the Inducement Plan that vest over two years.

Stock Options

Stock options are valued using the Black-Scholes option pricing model on the date of grant. The Company accounts for forfeitures upon occurrence.

The following tables summarize stock options outstanding and changes for the nine months ended September 30, 2022:

	September 30, 2022			September 30, 2021
		Weighted			Weighted
	Number of	Average		Number of	Average
	Stock	Exercise		Stock	Exercise
	Options	Price		Options	Price
Stock options outstanding at beginning of period	277,576	$	6.18	185,054	$	7.99
Granted	78,720		1.09	94,522		3.91
Expired	—		—	(2,000)		73.54
Stock options outstanding at end of period	356,296		5.06	277,576		6.18
Stock options exercisable at end of period	277,576	$	6.18	183,054	$	7.35

The weighted average remaining term for stock options outstanding as of September 30, 2022, is approximately 8.2 years.

The following table summarizes stock options outstanding and exercisable by stock option plan at September 30, 2022:

	Outstanding Stock Options			Exercisable Stock Options
	Number of	Weighted		Number of	Weighted
	Outstanding	Average		Stock Options	Average
Stock Option Plan	Stock Options	Exercise Price		Exercisable	Exercise Price
2004 Plan	92	$	1,638.00	92	$	1,638.00
2004 Directors’ Plan	3		10,380.00	3		10,380.00
2013 Plan	356,201		4.55	277,481		5.53
	356,296	$	5.06	277,576	$	6.18

As of September 30, 2022, the Company had less than $0.1 million of unrecognized compensation costs related to non-vested stock options that will be recognized over a period of approximately nine months.

Restricted Stock Units

Time-based and performance-based RSUs are valued using the closing share price of the Company’s common stock on the date of grant. The final number of shares issued under performance-based RSUs is generally based on the Company’s prior year performance as determined by the Committee at each vesting date, and the valuation of such awards assumes full satisfaction of all performance criteria.

The following table summarizes RSU activity for the nine months ended September 30, 2022 and 2021:

	September 30,			September 30,
	2022			2021
		Weighted-			Weighted-
		Average			Average
	Number of	Grant Date		Number of	Grant Date
	RSUs	Fair Value		RSUs	Fair Value
Unvested RSUs at beginning of period	385,004	$	3.18	236,403	$	2.10
Granted	1,168,003		1.16	240,125		3.93
Forfeited/Expired	(225,091)		2.39	—		—
Vested	(181,991)		2.31	(78,801)		2.10
Unvested RSUs at end of period	1,145,925	$	1.42	397,727	$	3.20

As of September 30, 2022, the Company had $0.8 million of unrecognized compensation costs related to non-vested restricted stock units that will be recognized over a period of approximately 2.25 years.

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OTHER (EXPENSE) INCOME, NET

9 Months Ended

Sep. 30, 2022

OTHER (EXPENSE) INCOME, NET

OTHER (EXPENSE) INCOME, NET

6. OTHER (EXPENSE) INCOME, NET

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
(thousands of dollars)	2022		2021		2022		2021
Other (expense) income:
Foreign exchange loss		(649)		—		(645)		—
Interest income		352		8		453		18
Other income		1		27		1		26
Total other (expense) income, net	$	(296)	$	35	$	(191)	$	44

As of the three and nine months ended September 30, 2022, the Company recognized $0.6 million of foreign currency exchange loss related to our Euro denominated bank account.  As of September 30, 2022, the Company’s cash balance included approximately 9.5 million Euros. The foreign exchange loss was calculated using the exchange rate as of the balance sheet date.  A change in the Euro to USD exchange rate of $0.01 results in a foreign exchange adjustment of less than $0.1 million.

As of the three and nine months ended September 30, 2022, the Company recognized interest income of $0.4 million and $0.5 million, respectively, in our investment account.  

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EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2022

EARNINGS PER SHARE

EARNINGS PER SHARE

7. EARNINGS PER SHARE

Basic and diluted loss per common share have been calculated based on the weighted-average shares outstanding during the period. Additionally, potentially dilutive shares of 1,502,221 from the unvested RSUs and the outstanding stock options at the end of the period were excluded from the calculation of earnings per share because the effect on the basic income per share would be anti-dilutive, as the Company had a net loss for the three and nine months ended September 30, 2022.

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COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2022

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

8. COMMITMENTS AND CONTINGENCIES

Future operations on the Company’s properties are subject to federal and state regulations for the protection of the environment, including air and water quality. The Company evaluates the status of current environmental laws and their potential impact on current operating costs and accrual for future costs. The Company believes its operations are materially compliant with current, applicable environmental regulations.

At any given time, the Company may enter into negotiations to settle outstanding legal proceedings and any resulting accruals will be estimated based on the relevant facts and circumstances applicable at that time. We do not expect that such settlements will, individually or in the aggregate, have a material effect on our financial position, results of operations or cash flows.

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LEASES

9 Months Ended

Sep. 30, 2022

LEASES

LEASES

9. LEASES

The Company’s lease portfolio consists of an operating lease for the corporate office, storage space and equipment. The corporate office lease has a remaining lease term of 0.83 years and includes an option to extend the lease for 3 years. Under our corporate office lease, we are required to reimburse the lessor each month for common use expenses such as maintenance and security services. Because these amounts are variable from year to year and not specifically set in the lease terms, they are not included in the measurement of the right-of-use asset and related lease liability, but rather expensed in the period incurred.

The Company is party to several leases that have terms that are less than a year in length. These include leases for land used in exploration activities, office equipment, machinery, office space, storage and other. The Company has elected the short-term lease exemption allowed under the new leasing standards, whereby leases with initial terms of one year or less are not capitalized and instead expensed on a straight-line basis over the lease term. In addition, the Company holds several leases related to mineral exploration and production to which it has not applied the new leasing standard. Leases to explore or use minerals and similar nonregenerative resources are specifically excluded by ASC 842, “Leases.”

The right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities were recognized at the commencement date of the lease based on the present value of lease payments over the lease term using a discount rate of 9.5%. This rate is the Company’s estimated incremental borrowing rate at the lease commencement date.

The components of lease expense are as follows:

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Operating lease cost	$	115	$	115

Supplemental cash flow information related to the Company’s operating leases is as follows:

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Cash paid for amounts included in lease liabilities:
Operating cash flows from operating leases	$	119	$	115
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	122	$	258

Supplemental balance sheet information related to the Company’s operating leases is as follows:

	September 30,		December 31,
(thousands of dollars)	2022		2021
Operating Leases
Operating lease right-of-use assets	$	122	$	226
Operating lease liability, current		128		152
Operating lease liabilities – long term portion		—		83
Total operating lease liabilities	$	128	$	235

Weighted-average remaining lease term and discount rate for the Company’s operating lease are as follows:

	For the Nine Months Ended
	September 30,
	2022		2021
Weighted Average Remaining Lease Term (in years)	0.8		1.8
Discount Rate	9.5	%	9.5	%

Maturities of lease liabilities for the Company’s operating leases are as follows:

Lease payments by year	September 30,
(in thousands)	2022
2022 (remainder of year)	$	40
2023		92
Total lease payments		132
Less imputed interest		(4)
Total	$	128

As of September 30, 2022, the Company has $0.1 million in right-of-use assets and $0.1 million in related lease liabilities, all of which is current. The most significant operating lease is for the Company’s corporate office in Centennial, Colorado, with $0.1 million remaining in undiscounted cash payments through the end of the lease term in 2023. The total undiscounted cash payments remaining on operating leases through the end of their respective terms is $0.1 million.

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BASIS OF PRESENTATION (Policies)

9 Months Ended

Sep. 30, 2022

BASIS OF PRESENTATION

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to estimate lifetime expected credit losses and recognize an allowance against the related instruments. For available for sale debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. The adoption of this update, if applicable, will result in earlier recognition of losses and impairments. ASU 2016-13 will be effective for interim and annual periods beginning after December 15, 2022.

In November 2018, the FASB issued ASU 2018-19, “Codification Improvements to ASC 326, Financial Instruments – Credit Losses”, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. ASU 2018-19 will be effective for interim and annual periods beginning after December 15, 2022.

The Company is currently evaluating ASU 2016-13 and ASU 2018-19 for the potential impact of adopting this guidance on its financial reporting.

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PROPERTY, PLANT AND EQUIPMENT (Tables)

9 Months Ended

Sep. 30, 2022

PROPERTY, PLANT AND EQUIPMENT.

Net Book Value of Property, Plant and Equipment

	Net Book Value of Property Plant and Equipment at September 30, 2022
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		5,755		26		5,781
Construction in progress		49,506		—		49,506
Total	$	64,233	$	26	$	64,259

	Net Book Value of Property Plant and Equipment at December 31, 2021
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		4,462		28		4,490
Construction in progress		1,017		—		1,017
Total	$	14,451	$	28	$	14,479

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STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2022

STOCK-BASED COMPENSATION

Summary of Stock Options Outstanding

	September 30, 2022			September 30, 2021
		Weighted			Weighted
	Number of	Average		Number of	Average
	Stock	Exercise		Stock	Exercise
	Options	Price		Options	Price
Stock options outstanding at beginning of period	277,576	$	6.18	185,054	$	7.99
Granted	78,720		1.09	94,522		3.91
Expired	—		—	(2,000)		73.54
Stock options outstanding at end of period	356,296		5.06	277,576		6.18
Stock options exercisable at end of period	277,576	$	6.18	183,054	$	7.35

Summary of Stock Options Outstanding and Exercisable by Stock Option Plan

	Outstanding Stock Options			Exercisable Stock Options
	Number of	Weighted		Number of	Weighted
	Outstanding	Average		Stock Options	Average
Stock Option Plan	Stock Options	Exercise Price		Exercisable	Exercise Price
2004 Plan	92	$	1,638.00	92	$	1,638.00
2004 Directors’ Plan	3		10,380.00	3		10,380.00
2013 Plan	356,201		4.55	277,481		5.53
	356,296	$	5.06	277,576	$	6.18

Summary of RSU Activity

	September 30,			September 30,
	2022			2021
		Weighted-			Weighted-
		Average			Average
	Number of	Grant Date		Number of	Grant Date
	RSUs	Fair Value		RSUs	Fair Value
Unvested RSUs at beginning of period	385,004	$	3.18	236,403	$	2.10
Granted	1,168,003		1.16	240,125		3.93
Forfeited/Expired	(225,091)		2.39	—		—
Vested	(181,991)		2.31	(78,801)		2.10
Unvested RSUs at end of period	1,145,925	$	1.42	397,727	$	3.20

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OTHER (EXPENSE) INCOME, NET (Tables)

9 Months Ended

Sep. 30, 2022

OTHER (EXPENSE) INCOME, NET

Schedule of total other (expense) income, net

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
(thousands of dollars)	2022		2021		2022		2021
Other (expense) income:
Foreign exchange loss		(649)		—		(645)		—
Interest income		352		8		453		18
Other income		1		27		1		26
Total other (expense) income, net	$	(296)	$	35	$	(191)	$	44

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LEASES (Tables)

9 Months Ended

Sep. 30, 2022

LEASES

Schedule of Components of lease expense

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Operating lease cost	$	115	$	115

Schedule of Supplemental Cash Flow Information Related to Leases

	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Cash paid for amounts included in lease liabilities:
Operating cash flows from operating leases	$	119	$	115
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	122	$	258

Schedule of Supplemental Balance Sheet Information Relating to Leases

	September 30,		December 31,
(thousands of dollars)	2022		2021
Operating Leases
Operating lease right-of-use assets	$	122	$	226
Operating lease liability, current		128		152
Operating lease liabilities – long term portion		—		83
Total operating lease liabilities	$	128	$	235

Schedule of Weighted-average Remaining Lease Term and Discount Rate for Operating Leases

	For the Nine Months Ended
	September 30,
	2022		2021
Weighted Average Remaining Lease Term (in years)	0.8		1.8
Discount Rate	9.5	%	9.5	%

Schedule of Maturities of Lease Liabilities for Operating Leases

Lease payments by year	September 30,
(in thousands)	2022
2022 (remainder of year)	$	40
2023		92
Total lease payments		132
Less imputed interest		(4)
Total	$	128

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LIQUIDITY (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended		25 Months Ended
	Aug. 20, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2022	Dec. 31, 2021	Dec. 04, 2020
Cash balances		$ 100,308		$ 100,308			$ 115,293
Issuance of common stock, net		$ 1,100		$ 25,604	$ 81,865
2020 Lincoln Park PA
Number of common stock issued		0	1,100,000	0	6,100,000
Issuance of common stock, net			$ 4,000		$ 34,600
Registered share available for future sales								16,000,000.0
ATM Offering Agreement
Number of common stock issued				12,600,000
Issuance of common stock, net	$ 50,000			$ 25,600
Lincoln Park | 2020 Lincoln Park PA
Number of common stock issued						6,300,000

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PROPERTY, PLANT AND EQUIPMENT - Net Book Value of Property, Plant and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	$ 64,259	$ 14,479
Mineral rights and properties
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	8,972	8,972
Other property, plant and equipment
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	5,781	4,490
Construction in progress
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	49,506	1,017
Alabama
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	64,233	14,451
Alabama | Mineral rights and properties
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	8,972	8,972
Alabama | Other property, plant and equipment
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	5,755	4,462
Alabama | Construction in progress
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	49,506	1,017
Corporate
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	26	28
Corporate | Other property, plant and equipment
Property, Plant and Equipment [Line Items]
Total Property, Plant and Equipment	$ 26	$ 28

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PROPERTY, PLANT AND EQUIPMENT - Construction in Progress & Impairment of Property, Plant and Equipment (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Impairment	$ 0
Construction in progress
Property, Plant and Equipment [Line Items]
Cash deposits		$ 2,700

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COMMON STOCK - Common Stock Issued, Net of Issuance Costs (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended		9 Months Ended		25 Months Ended	69 Months Ended
	Aug. 20, 2021	Dec. 04, 2020	Apr. 14, 2017	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2022	Dec. 31, 2022
Net proceeds from common stock				$ 1,100		$ 25,604	$ 81,865
Cantor Fitzgerald & Co
Number of common stock issued				800,000		12,600,000
2020 Lincoln Park PA
Maximum aggregate offering price		$ 100,000
Period for financing from common stock		36 months
Number of common stock issued				0	1,100,000	0	6,100,000
Net proceeds from common stock					$ 4,000		$ 34,600
Threshold average sale price per share of common stock		$ 6.15
Registered share available for future sales		16,000,000.0
2020 Lincoln Park PA | Maximum
Percentage of common stock issuable		19.99%
2020 Lincoln Park PA | Lincoln Park
Number of common stock issued								6,300,000
Minimum percentage considered for not to sale common stock		9.99%
ATM Offering Agreement
Number of common stock issued						12,600,000
Net proceeds from common stock	$ 50,000					$ 25,600
ATM Offering Agreement | Cantor Fitzgerald & Co | Maximum
Sales commission percentage			2.50%
Controlled Equity Offering Sales Agreement with Cantor Fitzgerald and Co.
Number of common stock issued							9,300,000
Net proceeds from common stock						$ 25,600	$ 47,300		$ 28,800

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STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
	Oct. 04, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	May 13, 2022	May 21, 2021	Apr. 28, 2020	Apr. 18, 2019	Jul. 18, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average remaining term for stock options outstanding				8 years 2 months 12 days
Unrecognized compensation costs related to non-vested stock options		$ 0.1		$ 0.1
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs related to non-vested stock options, period recognized				9 months
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs related to non-vested stock options, period recognized				2 years 3 months
Unrecognized compensation costs related to non-vested stock units, period recognized		$ 0.8		$ 0.8
2013 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock shares reserved for future issuance		215,025		215,025
Stock-based compensation expense		$ 0.3	$ 0.3	$ 0.7	$ 0.6
2013 Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock shares reserved for future issuance							1,500,000	350,000	66,000	20,000
Stock option vesting period				10 years
Inducement Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock shares reserved for future issuance						250,000
Equity awards issued				0
Inducement Plan | Subsequent Event
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vesting period	2 years
Equity awards issued	58,946

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STOCK-BASED COMPENSATION - Summary of Stock Options Outstanding (Details) - $ / shares	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
STOCK-BASED COMPENSATION
Number of stock options outstanding, Beginning of period	277,576	185,054
Number of stock options outstanding, Granted	78,720	94,522
Number of stock options outstanding, Expired	0	(2,000)
Number of stock options outstanding, End of period	356,296	277,576
Number of stock options Exercisable, End of period	277,576	183,054
Weighted average exercise price, Beginning of period	$ 6.18	$ 7.99
Weighted average exercise price, Granted	1.09	3.91
Weighted average exercise price, Expired	0	73.54
Weighted average exercise price, End of period	5.06	6.18
Weighted average exercise price Exercisable, End of period	$ 6.18	$ 7.35

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STOCK-BASED COMPENSATION - Summary of Stock Options Outstanding and Exercisable by Stock Option Plan (Details) - $ / shares	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding Stock Options, Number of Outstanding Stock Options	356,296	277,576	277,576	185,054
Outstanding Stock Options, Weighted Average Exercise Price	$ 5.06	$ 6.18	$ 6.18	$ 7.99
Exercisable Stock Options, Number of Exercisable Stock Options	277,576		183,054
Exercisable Stock Options, Weighted Average Exercise Price	$ 6.18		$ 7.35
2004 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding Stock Options, Number of Outstanding Stock Options	92
Outstanding Stock Options, Weighted Average Exercise Price	$ 1,638.00
Exercisable Stock Options, Number of Exercisable Stock Options	92
Exercisable Stock Options, Weighted Average Exercise Price	$ 1,638.00
2004 Directors Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding Stock Options, Number of Outstanding Stock Options	3
Outstanding Stock Options, Weighted Average Exercise Price	$ 10,380.00
Exercisable Stock Options, Number of Exercisable Stock Options	3
Exercisable Stock Options, Weighted Average Exercise Price	$ 10,380.00
2013 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding Stock Options, Number of Outstanding Stock Options	356,201
Outstanding Stock Options, Weighted Average Exercise Price	$ 4.55
Exercisable Stock Options, Number of Exercisable Stock Options	277,481
Exercisable Stock Options, Weighted Average Exercise Price	$ 5.53

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STOCK-BASED COMPENSATION - Summary of RSU Activity (Details) - Restricted Stock Units - $ / shares	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of RSUs, Unvested beginning of period	385,004	236,403
Number of RSUs, Granted	1,168,003	240,125
Number of RSUs, Forfeited/Expired	(225,091)	0
Number of RSUs, Vested	(181,991)	(78,801)
Number of RSUs, Unvested end of period	1,145,925	397,727
Weighted Average Grant Date Fair Value, Unvested RSUs beginning of period	$ 3.18	$ 2.10
Weighted Average Grant Date Fair Value, Granted	1.16	3.93
Weighted Average Grant Date Fair Value, Forfeited/Expired	2.39	0
Weighted Average Grant Date Fair Value, Vested	2.31	2.10
Weighted Average Grant Date Fair Value, Unvested RSUs end of period	$ 1.42	$ 3.20

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OTHER (EXPENSE) INCOME, NET (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Other (expense) income:
Foreign exchange loss	$ (649)		$ (645)
Interest income	352	$ 8	453	$ 18
Other income	1	27	1	26
Total other (expense) income, net	$ (296)	$ 35	$ (191)	$ 44

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OTHER (EXPENSE) INCOME, NET - Narrative (Details) € in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 EUR (€)
OTHER (EXPENSE) INCOME, NET
Foreign currency exchange loss related to our Euro denominated bank account	$ 649,000		$ 645,000
Cash balance in Euros | €					€ 9.5
Euro to USD exchange rate resulting in foreign exchange adjustment			0.01
Effect of exchange rate on cash			100,000
Interest income	$ 352,000	$ 8,000	$ 453,000	$ 18,000

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LEASES - Narrative (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Lessee, Lease, Description [Line Items]
Right-of-use lease asset	$ 122		$ 226
Lease liability	128		235
Operating lease liability, current	$ 128		152
Lease term using a discount rate	9.50%
Lease expense:
Operating lease cost	$ 115	$ 115
Supplemental cash flow information related to leases:
Cash flows from operating leases	119	115
Operating leases	122	$ 258
Supplemental balance sheet information related to leases:
Operating lease right-of-use assets	122		226
Operating lease liability, current	128		152
Operating lease liabilities - long term portion			83
Total operating lease liabilities	$ 128		$ 235
Weighted Average Remaining Lease Term (in years)	9 months 18 days	1 year 9 months 18 days
Discount Rate	9.50%	9.50%
Corporate office
Lessee, Lease, Description [Line Items]
Variable lease terms	Because these amounts are variable from year to year and not specifically set in the lease terms, they are not included in the measurement of the right-of-use asset and related lease liability, but rather expensed in the period incurred.
Lessee, Operating Lease, Existence of Option to Extend [true false]	true
Option to extend, renewal term	3 years
Supplemental balance sheet information related to leases:
Lessee, Operating Lease, Variable Lease Payment, Terms and Conditions	Because these amounts are variable from year to year and not specifically set in the lease terms, they are not included in the measurement of the right-of-use asset and related lease liability, but rather expensed in the period incurred.
Maximum | Land used in exploration and mining activities, office equipment, machinery, office space, storage and other
Lessee, Lease, Description [Line Items]
Term of contract	1 year

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LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Undiscounted cash payments:
2022 (remainder of year)	$ 40
2023	92
Total lease payments	132
Less imputed interest	(4)
Total operating lease liabilities	128	$ 235
Centennial, Colorado
Undiscounted cash payments:
Total lease payments	$ 100