URANIUM ENERGY CORP - FORM 10-Q

Attached files

file	filename
EX-32.1 - EXHIBIT 32.1 - URANIUM ENERGY CORP	ex_175862.htm
EX-31.2 - EXHIBIT 31.2 - URANIUM ENERGY CORP	ex_175861.htm
EX-31.1 - EXHIBIT 31.1 - URANIUM ENERGY CORP	ex_175860.htm

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 January 31, 2020

☐	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: 001-33706

URANIUM ENERGY CORP.

(Exact name of registrant as specified in its charter)

Nevada		98-0399476
State or other jurisdiction of incorporation of organization)		(I.R.S. Employer Identification No.)

1030 West Georgia Street, Suite 1830, Vancouver, B.C., Canada		V6E 2Y3
(Address of principal executive offices)		(Zip Code)

(604) 682-9775

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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	UEC	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: 183,910,180 shares of common stock outstanding as of March 9, 2020.

URANIUM ENERGY CORP.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION		4

Item 1.	Financial Statements	4

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	25

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32

Item 4.	Controls and Procedures	32

PART II – OTHER INFORMATION		33

Item 1.	Legal Proceedings	33

Item 1A.	Risk Factors	34

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44

Item 3.	Defaults Upon Senior Securities	45

Item 4.	Mine Safety Disclosures	45

Item 5.	Other Information	45

Item 6.	Exhibits	46

SIGNATURES		47

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

URANIUM ENERGY CORP.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JANUARY 31, 2020

(Unaudited)

URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

	Note(s)	January 31, 2020			July 31, 2019

CURRENT ASSETS
Cash and cash equivalents	5	$	10,272,315		$	6,058,186
Term deposits			-			11,831,671
Inventories			211,662			211,662
Prepaid expenses and deposits			1,459,916			1,343,458
Other current assets			124,351			264,956
TOTAL CURRENT ASSETS			12,068,244			19,709,933

MINERAL RIGHTS AND PROPERTIES	3		63,606,605			63,536,895
PROPERTY, PLANT AND EQUIPMENT	4		7,021,321			7,042,359
RESTRICTED CASH	5		1,834,746			1,821,392
EQUITY-ACCOUNTED INVESTMENT	6		10,994,683			8,680,449
OTHER LONG-TERM ASSETS	7		988,712			249,214
TOTAL ASSETS		$	96,514,311		$	101,040,242


CURRENT LIABILITIES
Accounts payable and accrued liabilities		$	1,917,939		$	3,002,688
Other current liabilities	11		198,108			-
Due to a related party	8		32,306			68,680
TOTAL CURRENT LIABILITIES			2,148,353			3,071,368

LONG-TERM DEBT	9		19,044,764			19,599,963
ASSET RETIREMENT OBLIGATIONS	10		3,637,698			3,541,082
OTHER LONG-TERM LIABILITIES	11		551,931			50,010
DEFERRED TAX LIABILITIES			546,941			550,551
TOTAL LIABILITIES			25,929,687			26,812,974

STOCKHOLDERS' EQUITY
Capital stock
Common stock $0.001 par value: 750,000,000 shares authorized, 183,673,815 shares issued and outstanding (July 31, 2019 - 180,896,431)	12		183,674			180,896
Additional paid-in capital			339,570,053			336,047,595
Share issuance obligation	12		-			187,100
Accumulated deficit			(269,132,022	)		(262,200,784	)
Accumulated other comprehensive (loss) income			(37,081	)		12,461
TOTAL EQUITY			70,584,624			74,227,268
TOTAL LIABILITIES AND EQUITY		$	96,514,311		$	101,040,242

COMMITMENTS AND CONTINGENCIES	16

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

URANIUM ENERGY CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

		Three Months Ended January 31,						Six Months Ended January 31,
	Note(s)	2020			2019			2020			2019

COSTS AND EXPENSES
Mineral property expenditures	3	$	1,323,323		$	899,217		$	2,846,774		$	1,765,460
General and administrative	8,12		2,394,794			2,183,463			4,709,964			4,442,398
Depreciation, amortization and accretion	3,4,10		81,752			84,807			158,138			173,583
TOTAL COSTS AND EXPENSES			3,799,869			3,167,487			7,714,876			6,381,441
LOSS FROM OPERATIONS			(3,799,869	)		(3,167,487	)		(7,714,876	)		(6,381,441	)

OTHER INCOME (EXPENSES)
Interest income			52,341			117,078			141,522			174,982
Interest expenses and finance costs	9		(859,163	)		(813,809	)		(1,744,288	)		(1,568,658	)
Income (loss) from equity-accounted investment	6		2,704,373			(105,837	)		2,363,776			282,032
Other income			9,925			29,819			17,218			96,255
Gain on disposition of assets	5		1,800			1,583,764			1,800			1,583,764
TOTAL OTHER INCOME (EXPENSES)			1,909,276			811,015			780,028			568,375
LOSS BEFORE INCOME TAXES			(1,890,593	)		(2,356,472	)		(6,934,848	)		(5,813,066	)

DEFERRED TAX BENEFITS			1,932			6,798			3,610			11,966
NET LOSS FOR THE PERIOD			(1,888,661	)		(2,349,674	)		(6,931,238	)		(5,801,100	)

OTHER COMPREHENSIVE (LOSS) INCOME,
NET OF INCOME TAXES			(39,648	)		38,232			(49,542	)		38,232
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD		$	(1,928,309	)	$	(2,311,442	)	$	(6,980,780	)	$	(5,762,868	)

NET LOSS PER SHARE, BASIC AND DILUTED	13	$	(0.01	)	$	(0.01	)	$	(0.04	)	$	(0.03	)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING,
BASIC AND DILUTED			182,802,747			177,061,313			182,021,725			171,729,303

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

URANIUM ENERGY CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

		Six Months Ended January 31,
	Note(s)	2020			2019
NET CASH PROVIDED BY (USED IN):

OPERATING ACTIVITIES
Net loss for the period		$	(6,931,238	)	$	(5,801,100	)
Adjustments to reconcile net loss to cash flows in operating activities
Stock-based compensation	12		1,715,636			1,588,866
Depreciation, amortization and accretion	3,4,10		158,138			173,583
Amortization of long-term debt discount	9		844,801			666,120
Gain on disposition of assets			(1,800	)		(1,583,764	)
Income from equity-accounted investment	6		(2,363,776	)		(282,032	)
Deferred tax benefits			(3,610	)		(11,966	)
Realized loss on available-for-sale securities			-			799
Changes in operating assets and liabilities
Prepaid expenses and deposits			137,189			(168,785	)
Other current assets			140,605			(81,609	)
Accounts payable and accrued liabilities			(1,134,749	)		(841,344	)
Due to a related party	8		(36,374	)		27,531
Other liabilities			(70,616	)		-
NET CASH USED IN OPERATING ACTIVITIES			(7,545,794	)		(6,313,701	)

FINANCING ACTIVITIES
Proceeds from share issuance, net of issuance costs			-			21,538,191
NET CASH PROVIDED BY FINANCING ACTIVITIES			-			21,538,191

INVESTING ACTIVITIES
Investment in mineral rights and properties			(30,000	)		(105,000	)
Purchase of property, plant and equipment			(30,194	)		(19,505	)
Investment in term deposits			-			(18,026,455	)
Proceeds from redemption of term deposits			11,831,671			-
Proceeds from disposition of assets			1,800			4,900
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES			11,773,277			(18,146,060	)

NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH			4,227,483			(2,921,570	)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD			7,879,578			8,716,422
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD	5	$	12,107,061		$	5,794,852

SUPPLEMENTAL CASH FLOW INFORMATION	15

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

URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)

	Common Stock				Additional Paid-in		Share Issuance			Accumulated			Accumulated Other Comprehensive			Stockholders'
	Shares		Amount		Capital		Obligation			Deficit			Income (Loss)			Equity
Balance, July 31, 2019		180,896,431	$	180,896	$	336,047,595	$	187,100		$	(262,200,784	)	$	12,461		$	74,227,268
Stock-based compensation
Common stock issued for consulting services		29,167		29		31,763		-			-			-			31,792
Common stock issued under Stock Incentive Plan		435,348		436		410,026		(187,100	)		-			-			223,362
Amortization of stock option expenses		-		-		662,232		-			-			-			662,232
Net loss for the period		-		-		-		-			(5,042,577	)		-			(5,042,577	)
Other comprehensive loss		-		-		-		-			-			(9,894	)		(9,894	)
Balance, October 31, 2019		181,360,946	$	181,361	$	337,151,616	$	-		$	(267,243,361	)	$	2,567		$	70,092,183
Common stock
Issued for credit facility		1,743,462		1,743		1,398,257		-			-			-			1,400,000
Stock-based compensation
Common stock issued for consulting services		313,201		313		277,644		-			-			-			277,957
Common stock issued under Stock Incentive Plan		256,206		257		234,535		-			-			-			234,792
Amortization of stock option expenses		-		-		485,268		-			-			-			485,268
Warrants
Issued for consulting services		-		-		22,733		-			-			-			22,733
Net loss for the period		-		-		-		-			(1,888,661	)		-			(1,888,661	)
Other comprehensive loss		-		-		-		-			-			(39,648	)		(39,648	)
Balance, January 31, 2020		183,673,815	$	183,674	$	339,570,053	$	-		$	(269,132,022	)	$	(37,081	)	$	70,584,624

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

URANIUM ENERGY CORP.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

	Common Stock				Additional Paid-in			Accumulated			Accumulated Other Comprehensive			Stockholders'
	Shares		Amount		Capital			Deficit			Income (Loss)			Equity
Balance, July 31, 2018		161,175,764	$	161,176	$	308,062,379		$	(245,151,636	)	$	103,641		$	63,175,560
Common stock
Issued for equity financing, net of issuance costs		12,613,049		12,613		15,978,349			-			-			15,990,962
Issued upon exercise of stock options		100,422		100		72,262			-			-			72,362
Issued upon exercise of warrants		2,061,764		2,062		2,494,555			-			-			2,496,617
Stock-based compensation
Common stock issued for consulting services		30,845		31		50,682			-			-			50,713
Common stock issued under Stock Incentive Plan		141,546		141		239,114			-			-			239,255
Amortization of stock option expenses		-		-		551,556			-			-			551,556
Warrants
Issued for equity financing		-		-		2,606,884			-			-			2,606,884
Issued for equity financing as issuance costs		-		-		371,366			-			-			371,366
Net loss for the period		-		-		-			(3,451,426	)		-			(3,451,426	)
Reclassification upon adoption of ASU No. 2016-01		-		-		-			103,641			(103,641	)		-
Balance, October 31, 2018		176,123,390	$	176,123	$	330,427,147		$	(248,499,421	)	$	-		$	82,103,849
Common stock
Issued upon exercise of stock options		16,964		17		(17	)		-			-			-
Issued for credit facility		1,180,328		1,180		1,398,820			-			-			1,400,000
Stock-based compensation
Common stock issued for consulting services		98,861		98		127,643			-			-			127,741
Common stock issued under Stock Incentive Plan		223,156		225		290,013			-			-			290,238
Amortization of stock option expenses		-		-		357,022			-			-			357,022
Net loss for the period		-		-		-			(2,349,674	)		-			(2,349,674	)
Other comprehensive income		-		-		-			-			38,232			38,232
Balance, January 31, 2019		177,642,699	$	177,643	$	332,600,628		$	(250,849,095	)	$	38,232		$	81,967,408

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

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

NOTE 1: NATURE OF OPERATIONS

Uranium Energy Corp. was incorporated in the State of Nevada on May 16, 2003. Uranium Energy Corp. and its subsidiary companies and a controlled partnership (collectively, the “Company” or “we”) are engaged in uranium and titanium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates and titanium minerals, on projects located in the United States, Canada and the Republic of Paraguay.

Although planned principal operations have commenced from which significant revenues from sales of uranium concentrates were realized for the fiscal years ended July 31, 2015 (“Fiscal 2015”), July 31, 2013 (“Fiscal 2013”) and July 31, 2012 (“Fiscal 2012”), we have yet to achieve profitability and have had a history of operating losses resulting in an accumulated deficit balance since inception. No revenue from uranium sales was realized for the six months ended January 31, 2020, or for the fiscal years ended July 31, 2019 (“Fiscal 2019”), July 31, 2018 (“Fiscal 2018”), July 31, 2017 (“Fiscal 2017”), July 31, 2016 (“Fiscal 2016”) or July 31, 2014 (“Fiscal 2014”). Historically, we have been reliant primarily on equity financings from the sale of our common stock and on debt financing in order to fund our operations, and this reliance is expected to continue for the foreseeable future.

At January 31, 2020, we had cash and cash equivalents of $10.3 million and working capital of $9.9 million. By curtailing expenditures on discretionary and non-core activities and paying certain management, consulting and service provider fees by the issuance of shares of the Company in lieu of cash, our existing cash resources, and if necessary, cash generated from the sale of the Company’s liquid assets, are expected to provide sufficient funds to carry out our planned operations for 12 months from the date that our condensed consolidated financial statements are issued. Our continued operations, including the recoverability of the carrying values of our assets, are dependent ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations.

NOTE 2: SUMMARY OF SIGNIFICANT POLICIES

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP”) for interim financial information and are presented in U.S. dollars. Accordingly, they do not include all of the information and footnotes required under U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for Fiscal 2019. In the opinion of management, all adjustments of a normal recurring nature and considered necessary for a fair presentation have been made. Operating results for the six months ended January 31, 2020, are not necessarily indicative of the results that may be expected for the fiscal year ending July 31, 2020 (“Fiscal 2020”).

Exploration Stage

We have established the existence of mineralized materials for certain uranium projects, including for our Palangana Mine. We have not established proven or probable reserves, as defined by the United States Securities and Exchange Commission (the “SEC”) under Industry Guide 7 (“Industry Guide 7”), through the completion of a “final” or “bankable” feasibility study for any of our uranium projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing in-situ recovery (“ISR”) mining, such as the Palangana Mine. As a result, and despite the fact that we commenced extraction of mineralized materials at the Palangana Mine in November 2010, we remain in the Exploration Stage as defined under Industry Guide 7, and will continue to remain in the Exploration Stage until such time proven or probable reserves have been established.

Since we commenced the extraction of mineralized materials at the Palangana Mine without having established proven or probable reserves, any mineralized materials established or extracted from the Palangana Mine should not in any way be associated with having established or produced from proven or probable reserves.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

In accordance with U.S. GAAP, expenditures relating to the acquisition of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time we exit the Exploration Stage by establishing proven or probable reserves. Expenditures relating to exploration activities such as drilling programs to establish mineralized materials are expensed as incurred. Expenditures relating to pre-extraction activities such as the construction of mine wellfields, ion exchange facilities and disposal wells are expensed as incurred until such time proven or probable reserves are established for that project, after which expenditures relating to mine development activities for that particular project are capitalized as incurred.

Companies in the Production Stage as defined under Industry Guide 7, having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. We are in the Exploration Stage which has resulted in us reporting larger losses than if we had been in the Production Stage due to the expensing, rather than capitalizing, of expenditures relating to ongoing mill and mine development activities. Additionally, there would be no corresponding amortization allocated to future reporting periods of our Company since those costs would have been expensed previously, resulting in both lower inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if we had been in the Production Stage. Any capitalized costs, such as expenditures relating to the acquisition of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage.

Recently Adopted Accounting Standards

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Codification (“ASC”) 2016-02, “Leases”, (Topic 842), together with subsequent amendments. The new standard requires a lessee to recognize on its balance sheet a liability to make lease payments (the lease liability) and the right-of-use (“ROU”) asset representing the right to the underlying asset for the lease term.

Effective August 1, 2019, the Company adopted this new standard using the modified retrospective approach with a cumulative-effect adjustment recorded at the beginning of the period of adoption. Therefore, upon adoption, the Company has recognized and measured leases without revising comparative period information or disclosure. We elected the package of practical expedients permitted under the transition guidance, which applies to expired or existing leases and allows the Company not to reassess whether a contract contains a lease, the lease classification and any initial direct costs incurred.

We elected the following optional practical expedients:

•

we elected the short-term lease recognition exemption whereby ROU assets and lease liabilities will not be recognized for leasing arrangements with terms less than one year;

•

we elected the land easements practical expedient whereby existing land easements are not reassessed under the new standard;

•

we elected hindsight practical expedient when determining lease term; and

•

we elected the practical expedient not to separate non-lease components from lease components.

Based on contracts outstanding at August 1, 2019, the adoption of the new standard resulted in the recognition of operating lease ROU assets of $876,590 including $92,235 reclassified from Prepaid Expenses and Deposits, and lease liabilities of $784,355. Adoption of this standard did not have a material impact to our Consolidated Statements of Operations and Comprehensive Loss and our Consolidated Statements of Cash Flows. See Note 11: Lease Liabilities for additional qualitative and quantitative disclosures related to leasing arrangements.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Accounting Policy - Leases

The Company’s accounting policy as a result of adoption of ASC 842 is summarized below.

The Company determines if a contractual arrangement represents or contains a lease at inception. Operating leases with lease terms greater than 12 months are included in Other Long-term Assets and Other Current Liabilities and Other Long-term Liabilities in our Consolidated Balance Sheet. Finance leases are included in Property, Plant and Equipment and Other Current Liabilities and Other Long-term Liabilities in our Consolidated Balance Sheet.

Operating and finance lease ROU assets and lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. When the rate implicit to the lease cannot be readily determined, the Company utilizes its incremental borrowing rate in determining the present value of the future lease payments. The incremental borrowing rate is the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term and the amount equal to the lease payments in a similar economic environment.

The Company’s operating lease expenses are recognized on a straight-line basis over the lease term and included in General and Administration expenses. Short-term leases, which have an initial term of 12 months or less, are not recorded in our Condensed Consolidated Balance Sheets.

The Company has leases arrangements that include both lease and non-lease components. The Company accounts for each separate lease component and its associated non-lease components as a single lease component for all of its asset classes.

NOTE 3: MINERAL RIGHTS AND PROPERTIES

Mineral Rights

At January 31, 2020, we had mineral rights in the States of Arizona, Colorado, New Mexico, Wyoming and Texas, in Canada and in the Republic of Paraguay. These mineral rights were acquired through staking, purchase or lease agreements and are subject to varying royalty interests, some of which are indexed to the sale price of uranium and titanium. At January 31, 2020, annual maintenance payments of approximately $2.7 million will be required to maintain these mineral rights.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Mineral rights and property acquisition costs consisted of the following:

	January 31, 2020			July 31, 2019
Mineral Rights and Properties
Palangana Mine	$	6,027,784		$	6,027,784
Goliad Project		8,689,127			8,689,127
Burke Hollow Project		1,495,750			1,495,750
Longhorn Project		116,870			116,870
Salvo Project		14,905			14,905
Anderson Project		3,470,373			3,470,373
Workman Creek Project		749,854			699,854
Los Cuatros Project		257,250			257,250
Slick Rock Project		30,000			-
Reno Creek Project		31,527,870			31,527,870
Diabase Project		546,938			546,938
Yuty Project		11,947,144			11,947,144
Oviedo Project		1,133,412			1,133,412
Alto Paraná Titanium Project		1,433,030			1,433,030
Other Property Acquisitions		91,080			91,080
		67,531,387			67,451,387
Accumulated Depletion		(3,929,884	)		(3,929,884	)
		63,601,503			63,521,503

Databases		2,410,038			2,410,038
Accumulated Amortization		(2,409,686	)		(2,409,188	)
		352			850

Land Use Agreements		48,770			404,310
Accumulated Amortization		(44,020	)		(389,768	)
		4,750			14,542
	$	63,606,605		$	63,536,895

We have not established proven or probable reserves, as defined by the SEC under Industry Guide 7, for any of our mineral projects. We have established the existence of mineralized materials for certain mineral projects, including our Palangana Mine. Since we commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated.

During the six months ended January 31, 2020 and 2019, we continued with reduced operations at the Palangana Mine to capture residual uranium only. As a result, no depletion for the Palangana Mine was recorded on our Condensed Consolidated Financial Statements for the three and six months ended January 31, 2020 and 2019.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Mineral property expenditures incurred by major projects were as follows:

	Three Months Ended January 31,				Six Months Ended January 31,
	2020		2019		2020		2019
Mineral Property Expenditures
Palangana Mine	$	528,699	$	246,592	$	848,726	$	526,624
Goliad Project		36,843		19,056		96,807		37,878
Burke Hollow Project		220,812		166,469		869,673		275,014
Longhorn Project		2,289		10,157		12,446		25,533
Salvo Project		6,702		6,702		13,970		13,510
Anderson Project		13,433		15,056		29,486		37,270
Workman Creek Project		8,168		7,673		16,365		15,364
Slick Rock Project		13,271		12,206		26,405		29,430
Reno Creek Project		144,181		147,418		292,224		295,294
Yuty Project		16,718		62,600		30,914		86,003
Oviedo Project		123,117		40,758		229,055		61,483
Alto Paraná Titanium Project		110,085		34,429		166,333		60,262
Other Mineral Property Expenditures		99,005		130,101		214,370		301,795
	$	1,323,323	$	899,217	$	2,846,774	$	1,765,460

NOTE 4: PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following:

	January 31, 2020							July 31, 2019
	Cost		Accumulated Depreciation			Net Book Value		Cost		Accumulated Depreciation			Net Book Value
Hobson Processing Facility	$	6,642,835	$	(773,933	)	$	5,868,902	$	6,642,835	$	(773,933	)	$	5,868,902
Mining Equipment		2,394,278		(2,334,120	)		60,158		2,467,557		(2,402,681	)		64,876
Logging Equipment and Vehicles		1,948,557		(1,734,654	)		213,903		1,950,229		(1,730,905	)		219,324
Computer Equipment		577,410		(554,687	)		22,723		572,551		(546,652	)		25,899
Furniture and Fixtures		170,701		(169,663	)		1,038		170,701		(169,379	)		1,322
Land and Buildings		889,606		(35,009	)		854,597		889,606		(27,570	)		862,036
	$	12,623,387	$	(5,602,066	)	$	7,021,321	$	12,693,479	$	(5,651,120	)	$	7,042,359

During the six months ended January 31, 2020 and 2019, no uranium concentrate was processed at our Hobson Processing Facility due to the reduced operations at our Palangana Mine. As a result, no depreciation for the Hobson Processing Facility was recorded on our Consolidated Financial Statements for the three and six months ended January 31, 2020 and 2019.

NOTE 5: RESTRICTED CASH

Restricted cash includes cash and cash equivalents and money market funds as collateral for various bonds posted in favor of applicable state regulatory agencies in Arizona, Texas and Wyoming, and for estimated reclamation costs associated with our Palangana Mine, Hobson Processing Facility and Reno Creek Project. Restricted cash will be released upon completion of reclamation of a mineral property or restructuring of a surety and collateral arrangement.

	January 31, 2020		July 31, 2019
Restricted cash, beginning of period	$	1,821,392	$	1,789,899
Interest received		13,354		31,493
Restricted cash, end of period	$	1,834,746	$	1,821,392

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Cash, cash equivalents and restricted cash are included in the following accounts at January 31, 2020 and 2019:

	January 31, 2020		January 31, 2019
Cash and cash equivalents	$	10,272,315	$	3,990,524
Restricted cash		1,834,746		1,804,328
Total cash, cash equivalents and restricted cash	$	12,107,061	$	5,794,852

NOTE 6: EQUITY-ACCOUNTED INVESTMENT

As at January 31, 2020, we own 14,000,000 shares of Uranium Royalty Corp. (“URC”).

During the three months ended January 31, 2020, URC completed an initial public offering which consisted of the issuance of 20,000,000 units of URC (each, a “URC Unit”). Each URC Unit is comprised of one common share and one common share purchase warrant of URC. URC is now listed for trading on the TSX Venture Exchange with the trading symbol “URC.V”.

As at January 31, 2020, we owned a 19.5% (July 31, 2019: 32.6%) interest in URC. In addition, two of our officers are members of URC’s board of directors, one of which is an officer of URC. As a consequence, our ability to exercise significant influence over URC’s operating and financing policies continued to exist during the three and six months ended January 31, 2020.

During the three months ended January 31, 2020, URC acquired a 0.5% net profit interest royalty in our Reno Creek Project from a third party.

During the six months ended January 31, 2020, the change in carrying value of our investment in URC is summarized as follows:

Balance, July 31, 2019	$	8,680,449
Share of loss from URC		(692,880	)
Gain on ownership interest dilution		3,056,656
Translation loss		(49,542	)
Balance, January 31, 2020	$	10,994,683

NOTE 7: OTHER LONG-TERM ASSETS

At January 31, 2020, other long-term assets totaled $988,712 (July 31, 2019: $249,214), which included ROU assets relating to the operating leases totaling $770,645 (July 31, 2019: $Nil) and the non-current portion of certain prepaid expenses of $218,067 (July 31, 2019: $249,214).

NOTE 8: RELATED PARTY TRANSACTIONS

During the three months ended January 31, 2020 and 2019, we incurred $35,657 and $40,017 (six months ended January 31, 2020 and 2019: $68,490 and $77,721), respectively, in general and administrative costs paid to Blender Media Inc. (“Blender”), a company controlled by Arash Adnani, a direct family member of our President and Chief Executive Officer, for various services including information technology, corporate branding, media, website design, maintenance and hosting, provided to the Company.

At January 31, 2020, the amount owing to Blender was $32,306 (July 31, 2019: $68,680).

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

NOTE 9: LONG-TERM DEBT

As at January 31, 2020, our long-term debt consisted of the following:

	January 31, 2020			July 31, 2019
Principal amount	$	20,000,000		$	20,000,000
Unamortized discount and accrued fees		(955,236	)		(400,037	)
Long-term debt, net of unamortized discount	$	19,044,764		$	19,599,963

For the three months ended January 31, 2020 and 2019, amortization of debt discount totaled $412,580 and $358,349, (six months ended January 31, 2020 and 2019: $844,801 and $666,120), respectively, which was recorded as interest expense and included in our Condensed Consolidated Statements of Operations and Comprehensive Loss.

During the three months ended January 31, 2020, and pursuant to the terms of our Third Amended and Restated Credit Agreement with our Lenders, we issued an aggregate of 1,743,462 shares with a fair value of $1,400,000 to our Lenders, representing 7% of the $20,000,000 principal balance outstanding at October 31, 2019, as payment of anniversary fees to our Lenders.

The Company’s Credit Facility has a maturity date on January 31, 2022, with an interest rate of 8% per annum and an underlying effective interest rate of 16.67%.

The aggregate yearly maturities of long-term debt based on principal amounts outstanding at January 31, 2020 are as follows:

Fiscal 2020	$	-
Fiscal 2021		-
Fiscal 2022		20,000,000
Total	$	20,000,000

NOTE 10: ASSET RETIREMENT OBLIGATIONS

Asset retirement obligations (“ARO”) relate to future remediation and decommissioning activities at our Palangana Mine, Hobson Processing Facility, Reno Creek Project and Alto Paraná Titanium Project.

Balance, July 31, 2019	$	3,541,082
Accretion		96,616
Balance, January 31, 2020	$	3,637,698

The estimated amounts and timing of cash flows and assumptions used for ARO estimates are as follows:

	January 31, 2020			July 31, 2019
Undiscounted amount of estimated cash flows	$	8,221,018		$	8,221,018

Payable in years	9	to	21	9	to	21
Inflation rate	1.56%	to	2.17%	1.56%	to	2.17%
Discount rate	5.50%	to	5.96%	5.50%	to	5.96%

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

The undiscounted amounts of estimated cash flows for the next five fiscal years and beyond are as follows:

Fiscal 2021	$	-
Fiscal 2022		-
Fiscal 2023		-
Fiscal 2024		-
Fiscal 2025		-
Remaining balance		8,221,018
	$	8,221,018

NOTE 11: LEASE LIABILITIES

The Company primarily has operating leases for corporate offices and a processing facility with a remaining term of 1.2 to 19.3 years. The lease for the processing facility has an evergreen option that can continue for so long as it is in operation. Short-term leases, which have an initial term of 12 months or less, are not recorded in our Consolidated Balance Sheets.

During the three and six months ended January 31, 2020, total lease expenses include the following components:

	Three Months Ended		Six Months Ended
	January 31, 2020		January 31, 2020
Operating leases	$	59,309	$	118,939
Short-term leases		23,516		397,029
Total Lease Expenses	$	82,825	$	515,968

As at January 31, 2020, the weighted average remaining lease term was 14.1 years and weighted average discount rate was 4.7%.

During the six months ended January 31, 2020, cash paid for amounts included in the measurement of operating lease liabilities totaled $100,450.

Minimum future lease payments under operating leases with terms longer than one year are as follows:

Fiscal 2020	$	120,382
Fiscal 2021		175,382
Fiscal 2022		220,000
Fiscal 2023		20,000
Fiscal 2024		20,000
Thereafter		320,000
Total lease payments		875,764
Less: imputed interest		(179,713	)
Present value of lease liabilities	$	696,051

Currrent portion of lease liabilities		189,974
Non-curent portion of lease liabilities	$	506,077

Current lease liabilities are included in Other Current Liabilities, and non-current liabilities are included in Other Long-term Liabilities in our Consolidated Balance Sheets.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

NOTE 12: CAPITAL STOCK

A summary of share purchase warrants outstanding and exercisable at January 31, 2020 is as follows:

Weighted Average Exercise Price		Number of Warrants Outstanding		Weighted Average Remaining Contractual Life (Years)	Expiry Date
$	1.25		150,000	0.90	December 23, 2020
	1.50		150,000	0.90	December 23, 2020
	2.05		7,063,253	1.17	April 3, 2021
	2.30		308,728	2.52	August 9, 2022
	1.64		50,000	3.30	May 21, 2023
$	2.03		7,721,981	1.23

A continuity schedule of outstanding share purchase warrants for the six months ended January 31, 2020 is as follows:

	Number of Warrants			Weighted Average Exercise Price
Balance, July 31, 2019		19,443,910			1.94
Issued		300,000			1.38
Expired		(12,021,929	)		1.87
Balance, January 31, 2020		7,721,981		$	2.03

Stock Options

At January 31, 2020, we had one stock option plan, our 2019 Stock Incentive Plan, which superseded and replaced our 2018 Stock Incentive Plan (now, the “Stock Incentive Plan”).

A summary of stock options granted by the Company during the six months ended January 31, 2020, including corresponding grant date fair values and assumptions using the Black Scholes option pricing model is as follows:

Date

Options
Granted

Exercise

Price

Term
(Years)

Fair
Value

Expected
Life (Years)

Risk-Free
Interest Rate

Dividend

Yield

Expected

Volatility

August 7, 2019

597,650

0.91

10.00

303,160

5.00

1.51

0.00

66.10

These stock options are subject to a 24-month vesting provision whereby at the end of the first three and six months from the grant date, 12.5% of the stock options granted become exercisable, and whereby at the end of each of 12, 18 and 24 months from the grant date, 25% of the total stock options become exercisable.

A continuity schedule of outstanding stock options for the underlying shares for the six months ended January 31, 2020, is as follows:

	Number of Stock Options			Weighted Average Exercise Price
Balance, July 31, 2019		15,738,350		$	1.30
Granted		597,650			0.91
Expired		(5,990,000	)		1.34
Balance, October 31, 2019		10,346,000		$	1.25
Forfeited		(21,875	)		1.19
Expired		(37,500	)		1.20
Balance, January 31, 2020		10,286,625		$	1.25

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

A continuity schedule of outstanding unvested stock options at January 31, 2020, and the changes during the period, is as follows:

	Number of Unvested Stock Options			Weighted Average Grant-Date Fair Value
Balance, July 31, 2019		3,310,600		$	0.59
Granted		597,650			0.51
Vested		(645,550	)		0.61
Balance, October 31, 2019		3,262,700		$	0.57
Forfeited		(21,875	)		0.59
Vested		(806,534	)		0.62
Balance, January 31, 2020		2,434,291		$	0.55

At January 31, 2020, unrecognized stock-based compensation expense related to the unvested portion of stock options totaled $701,836 to be recognized over the next 0.99 years.

At January 31, 2020, the aggregate intrinsic value under the provisions of ASC 718 of all outstanding stock options was estimated at $Nil (vested: $Nil and unvested: $Nil).

A summary of stock options outstanding and exercisable at January 31, 2020 is as follows:

			Options Outstanding						Options Exercisable
Range of Exercise Prices			Outstanding at January 31, 2020		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Exercisable at January 31, 2020		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)
$0.91	to	$0.99		4,227,625	$	0.94		6.11		2,309,334	$	0.94		3.30
$1.00	to	$1.49		3,572,500		1.22		1.92		3,531,250		1.22		1.89
$1.50	to	$3.75		2,486,500		1.84		2.95		2,011,750		1.91		2.83
				10,286,625	$	1.25		3.89		7,852,334	$	1.31		2.54

Restricted Stock Units

During Fiscal 2019, the Company granted 465,000 restricted stock units (each, a “RSU”) to certain directors and officers of the Company under our Stock Incentive Plan.

During the three and six months ended January 31, 2020, stock-based compensation relating to the RSUs totaled $66,928 and $133,856 (three and six months ended January 31, 2019: $Nil and $Nil), respectively. At January 31, 2020, outstanding unvested RSUs totaled 465,000 (July 31, 2019: 465,000) and unrecognized compensation costs relating to unvested RSUs totaled $304,220, which is expected to be recognized over a period of approximately 2.50 years.

Performance Based Restricted Stock Units

During Fiscal 2019, the Company granted 445,000 performance based restricted stock units (each, a “PRSU”) to the Company’s executive officers under our Stock Incentive Plan.

During the three and six months ended January 31, 2020, stock-based compensation relating to the PRSUs totaled $68,165 and $136,330 (three and six months ended January 31, 2019: $Nil and $Nil), respectively. At January 31, 2020, outstanding unvested PRSUs totaled 445,000 (July 31, 2019: 445,000) and unrecognized compensation costs relating to unvested PRSUs totaled $375,682, which is expected to be recognized over a period of approximately 2.50 years.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Stock-Based Compensation

A summary of stock-based compensation expense is as follows:

	Three Months Ended January 31,				Six Months Ended January 31,
	2020		2019		2020			2019
Stock-Based Compensation for Consultants
Common stock issued for consulting services	$	126,150	$	229,806	$	233,758		$	360,610
Amortization of stock option expenses		53,554		30,319		100,525			84,720
		179,704		260,125		334,283			445,330
Stock-Based Compensation for Management
Common stock issued to management		34,100		35,639		68,807			70,983
Amortization of stock option expenses		162,728		139,900		406,105			356,704
Amortization of RSU & PRSU expenses		135,093		-		270,186			-
		331,921		175,539		745,098			427,687
Stock-Based Compensation for Employees
Common stock issued to employees		129,997		124,872		258,025			248,695
Amortization of stock option expenses		156,628		186,806		393,419			467,154
		286,625		311,678		651,444			715,849

Settlement of share issuance obligation		-		-		(15,189	)		-
	$	798,250	$	747,342	$	1,715,636		$	1,588,866

During the six months ended January 31, 2020, we issued 188,914 shares with a fair value of $171,911 under our Stock Incentive Plan as settlement of our then share issuance obligations totaling $187,100, which represented the fair value of the Fiscal 2019 share bonuses made by the Company at July 31, 2019 under the Stock Incentive Plan. The change in fair value of $15,189 between the measurement date of July 31, 2019 and the issuance date was recorded as a credit to the stock-based compensation for the six months ended January 31, 2020.

NOTE 13: LOSS PER SHARE

The following table reconciles the weighted average number of shares used in the calculation of the basic and diluted loss per share:

	Three Months Ended January 31,						Six Months Ended January 31,
	2020			2019			2020			2019
Numerator
Net Loss for the Period	$	(1,888,661	)	$	(2,349,674	)	$	(6,931,238	)	$	(5,801,100	)

Denominator
Basic Weighted Average Number of Shares		182,802,747			177,061,313			182,021,725			171,729,303
Dilutive Stock Options, Warrants, RSUs and PRSUs		-			-			-			-
Diluted Weighted Average Number of Shares		182,802,747			177,061,313			182,021,725			171,729,303

Net Loss per Share, Basic and Diluted	$	(0.01	)	$	(0.01	)	$	(0.04	)	$	(0.03	)

For the three and six months ended January 31, 2020 and 2019, all outstanding stock options, RSUs, PRSUs and share purchase warrants were excluded from the calculation of the diluted loss per share since we reported net losses for those periods and their effects would be anti-dilutive.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

NOTE 14: SEGMENTED INFORMATION

We currently operate in one reportable segment which is focused on uranium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates.

At January 31, 2020, our long-term assets located in the United States totaled $57,887,302 or 69% of our total long-term assets of $84,446,067.

The table below provides a breakdown of the long-term assets by geographic segments:

January 31, 2020

Balance Sheet Items

United States

Texas

Arizona

Wyoming

Other States

Canada

Paraguay

Total

Mineral Rights and Properties

12,423,411

4,477,477

31,527,870

117,324

546,938

14,513,585

63,606,605

Property, Plant and Equipment

6,310,027

335,078

9,169

367,047

7,021,321

Restricted Cash

1,745,773

15,000

73,973

1,834,746

Equity-Accounted Investment

10,994,683

Other Long-Term Assets

836,369

25,000

127,343

988,712

Total Long-Term Assets

21,315,580

4,492,477

31,961,921

117,324

11,678,133

14,880,632

84,446,067

	July 31, 2019
Balance Sheet Items	United States
	Texas		Arizona		Wyoming		Other States		Canada		Paraguay		Total
Mineral Rights and Properties	$	12,433,203	$	4,427,477	$	31,527,870	$	87,822	$	546,938	$	14,513,585	$	63,536,895
Property, Plant and Equipment		6,333,950		-		342,515		-		14,223		351,671		7,042,359
Restricted Cash		1,732,419		15,000		73,973		-		-		-		1,821,392
Equity-Accounted Investment		-		-		-		-		8,680,449		-		8,680,449
Other Long-Term Assets		221,214		-		28,000		-		-		-		249,214
Total Long-Term Assets	$	20,720,786	$	4,442,477	$	31,972,358	$	87,822	$	9,241,610	$	14,865,256	$	81,330,309

The tables below provide a breakdown of our operating results by geographic segments for the three and six months ended January 31, 2020 and 2019. All intercompany transactions have been eliminated.

Three months ended January 31, 2020

Statement of Operations

United States

Texas

Arizona

Wyoming

Other States

Canada

Paraguay

Total

Costs and Expenses:

Mineral property expenditures

891,008

21,600

144,182

16,614

249,919

1,323,323

General and administrative

1,713,121

3,439

20,478

410

634,315

23,031

2,394,794

Depreciation, amortization and accretion

72,437

3,720

249

2,465

2,881

81,752

2,676,566

25,039

168,380

17,273

636,780

275,831

3,799,869

Loss from operations

(2,676,566

)

(25,039

)

(168,380

)

(17,273

)

(636,780

)

(275,831

)

(3,799,869

)

Other income (expenses)

(844,506

)

(4,768

)

700

2,756,714

1,136

1,909,276

Loss before income taxes

(3,521,072

)

(29,807

)

(167,680

)

(17,273

)

2,119,934

(274,695

)

(1,890,593

)

	Three Months Ended January 31, 2019
Statement of Operations	United States
	Texas			Arizona			Wyoming			Other States			Canada			Paraguay			Total
Costs and Expenses:
Mineral property expenditures	$	575,666		$	22,866		$	147,418		$	15,345		$	135		$	137,787		$	899,217
General and administrative		1,508,298			3,482			23,132			1,687			613,571			33,293			2,183,463
Depreciation, amortization and accretion		76,327			-			3,720			249			2,589			1,922			84,807
		2,160,291			26,348			174,270			17,281			616,295			173,002			3,167,487
Loss from operations		(2,160,291	)		(26,348	)		(174,270	)		(17,281	)		(616,295	)		(173,002	)		(3,167,487	)

Other income (expenses)		(775,613	)		(4,768	)		100			1,578,864			11,242			1,190			811,015
Loss before income taxes	$	(2,935,904	)	$	(31,116	)	$	(174,170	)	$	1,561,583		$	(605,053	)	$	(171,812	)	$	(2,356,472	)

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

Six Months Ended January 31, 2020

Statement of Operations

United States

Texas

Arizona

Wyoming

Other States

Canada

Paraguay

Total

Costs and Expenses:

Mineral property expenditures

2,045,350

46,172

292,225

36,725

426,302

2,846,774

General and administrative

3,413,998

6,828

55,191

1,062

1,188,021

44,864

4,709,964

Depreciation, amortization and accretion

139,933

7,437

498

5,054

5,216

158,138

5,599,281

53,000

354,853

38,285

1,193,075

476,382

7,714,876

Loss from operations

(5,599,281

)

(53,000

)

(354,853

)

(38,285

)

(1,193,075

)

(476,382

)

(7,714,876

)

Other income (expenses)

(1,719,112

)

(9,535

)

700

2,505,298

2,677

780,028

Loss before income taxes

(7,318,393

)

(62,535

)

(354,153

)

(38,285

)

1,312,223

(473,705

)

(6,934,848

)

	Six Months Ended January 31, 2019
Statement of Operations	United States
	Texas			Arizona			Wyoming			Other States			Canada			Paraguay			Total
Costs and Expenses:
Mineral property expenditures	$	1,154,488		$	52,987		$	295,294		$	39,220		$	15,723		$	207,748		$	1,765,460
General and administrative		3,070,055			6,871			54,502			1,948			1,225,041			83,981			4,442,398
Depreciation, amortization and accretion		156,412			-			7,439			498			6,487			2,747			173,583
		4,380,955			59,858			357,235			41,666			1,247,251			294,476			6,381,441
Loss from operations		(4,380,955	)		(59,858	)		(357,235	)		(41,666	)		(1,247,251	)		(294,476	)		(6,381,441	)

Other income (expenses)		(1,461,146	)		(9,535	)		400			1,578,864			457,061			2,731			568,375
Loss before income taxes	$	(5,842,101	)	$	(69,393	)	$	(356,835	)	$	1,537,198		$	(790,190	)	$	(291,745	)	$	(5,813,066	)

NOTE 15: SUPPLEMENTAL CASH FLOW INFORMATION

During the six months ended January 31, 2020 and 2019, we issued 342,368 and 129,706 shares with a fair value of $309,749 and $178,454, respectively, for consulting services.

During the six months ended January 31, 2020 and 2019, we issued 691,544 and 364,702 shares with a fair value of $645,254 and $529,492, respectively, as compensation to certain management, employees and consultants of the Company under our Stock Incentive Plan.

During the three months ended January 31, 2020, we issued an aggregate of 1,743,462 shares with a fair value of $1,400,000 to our Lenders.

During the six months ended January 31, 2020 and 2019, we paid $817,778 and $817,778, respectively, in cash to our Lenders for interest on the long-term debt.

NOTE 16: COMMITMENTS AND CONTINGENCIES

We are committed to paying our key executives a total of $704,000 per year for various management services.

We are subject to ordinary routine litigation incidental to our business. Except as disclosed below, we are not aware of any material legal proceedings pending or that have been threatened against the Company.

URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

January 31, 2020

(Unaudited)

On or about March 9, 2011, the Texas Commission on Environmental Quality (the “TCEQ”) granted the Company’s applications for a Class III Injection Well Permit, Production Area Authorization and Aquifer Exemption for its Goliad Project. On or about December 4, 2012, the U.S. Environmental Protection Agency (the “EPA”) concurred with the TCEQ issuance of the Aquifer Exemption permit (the “AE”). With the receipt of this concurrence, the final authorization required for uranium extraction, the Goliad Project achieved fully-permitted status. On or about May 24, 2011, a group of petitioners, inclusive of Goliad County, appealed the TCEQ action to the 250^th District Court in Travis County, Texas. A motion filed by the Company to intervene in this matter was granted. The petitioners’ appeal lay dormant until on or about June 14, 2013, when the petitioners filed their initial brief in support of their position. On or about January 18, 2013, a different group of petitioners, exclusive of Goliad County, filed a petition for review with the Court of Appeals for the Fifth Circuit in the United States (the “Fifth Circuit”) to appeal the EPA’s decision. On or about March 5, 2013, a motion filed by the Company to intervene in this matter was granted. The parties attempted to resolve both appeals, to facilitate discussions and avoid further legal costs. The parties jointly agreed, through mediation initially conducted through the Fifth Circuit on or about August 8, 2013, to abate the proceedings in the State District Court. On or about August 21, 2013, the State District Court agreed to abate the proceedings. The EPA subsequently filed a motion to remand without vacatur with the Fifth Circuit wherein the EPA’s stated purpose was to elicit additional public input and further explain its rationale for the approval. In requesting the remand without vacatur, which would allow the AE to remain in place during the review period, the EPA denied the existence of legal error and stated that it was unaware of any additional information that would merit reversal of the AE. The Company and the TCEQ filed a request to the Fifth Circuit for the motion to remand without vacatur, and if granted, to be limited to a 60-day review period. On December 9, 2013, by way of a procedural order from a three-judge panel of the Fifth Circuit, the Court granted the remand without vacatur and initially limited the review period to 60 days. In March of 2014, at the EPA’s request, the Fifth Circuit extended the EPA’s time period for review and additionally, during that same period, the Company conducted a joint groundwater survey of the site, the result of which reaffirmed the Company’s previously filed groundwater direction studies. On or about June 17, 2014, the EPA reaffirmed its earlier decision to uphold the granting of the Company’s existing AE, with the exception of a northwestern portion containing less than 10% of the uranium resource which was withdrawn, but not denied, from the AE area until additional information is provided in the normal course of mine development. On or about September 9, 2014, the petitioners filed a status report with the State District Court which included a request to remove the stay agreed to in August 2013 and to set a briefing schedule (the “Status Report”). In that Status Report, the petitioners also stated that they had decided not to pursue their appeal at the Fifth Circuit. The Company continues to believe that the pending appeal is without merit and is continuing as planned towards uranium extraction at its fully-permitted Goliad Project.

The Company has had communications and filings with the Ministry of Public Works and Communications (“MOPC”), the mining regulator in Paraguay, whereby the MOPC is taking the position that certain concessions forming part of the Company’s Yuty and Alto Parana projects are not eligible for extension as to exploration or continuation to exploitation in their current stages. While the Company remains fully committed to its development path forward in Paraguay, it caused its legal counsel to file an appeal in Paraguay to reverse the MOPC’s position in order to protect the Company’s continuing rights in those concessions.

At any given time, we 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.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following management’s discussion and analysis of the Company’s financial condition and results of operations (the “MD&A”) contain forward-looking statements that involve risks, uncertainties and assumptions including, among others, statements regarding our capital needs, business plans and expectations. In evaluating these statements, you should consider various factors, including the risks, uncertainties and assumptions set forth in reports and other documents we have filed with or furnished to the SEC and, including, without limitation, this Form 10-Q Quarterly Report for the six months ended January 31, 2020, and our Form 10-K Annual Report for the fiscal year ended July 31, 2019, including the consolidated financial statements and related notes contained therein. These factors, or any one of them, may cause our actual results or actions in the future to differ materially from any forward-looking statement made in this document. Refer to “Cautionary Note Regarding Forward-looking Statements” as disclosed in our Form 10-K Annual Report for the fiscal year ended July 31, 2019, and Item 1A, Risk Factors, under Part II - Other Information of this Quarterly Report.

Introduction

This MD&A is focused on material changes in our financial condition from July 31, 2019, our most recently completed year end, to January 31, 2020, and our results of operations for the three and six months ended January 31, 2020, and should be read in conjunction with Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations as contained in our Form 10-K Annual Report for Fiscal 2019.

Business

We are pre-dominantly engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on uranium projects located in the United States and Paraguay, as more fully described in our Form 10-K Annual Report for Fiscal 2019.

We utilize in-situ recovery (“ISR”) mining where possible which we believe, when compared to conventional open pit or underground mining, requires lower capital and operating expenditures with a shorter lead time to extraction and a reduced impact on the environment. We have one uranium mine located in the State of Texas, the Palangana Mine, which utilizes ISR mining and commenced extraction of uranium concentrates (“U₃O₈”), or yellowcake, in November 2010. We have one uranium processing facility located in the State of Texas, the Hobson Processing Facility, which processes material from the Palangana Mine into drums of U₃O₈, our only sales product and source of revenue, for shipping to a third-party storage and sales facility. At January 31, 2020, we had no uranium supply or off-take agreements in place.

Our fully-licensed and 100%-owned Hobson Processing Facility forms the basis for our regional operating strategy in the State of Texas, specifically the South Texas Uranium Belt where we utilize ISR mining. We utilize a “hub-and-spoke” strategy whereby the Hobson Processing Facility acts as the central processing site (the “hub”) for the Palangana Mine and future satellite uranium mining activities, such as our Burke Hollow and Goliad Projects, located within the South Texas Uranium Belt (the “spokes”). The Hobson Processing Facility has a physical capacity to process uranium-loaded resins up to a total of two million pounds of U₃O₈ annually and is licensed to process up to one million pounds of U₃O₈ annually.

We acquired the fully permitted Reno Creek Project in August 2017 and expanded our operations to the strategic Powder River Basin in Wyoming.

We also hold certain mineral rights in various stages in the States of Arizona, Colorado, New Mexico, Texas and Wyoming, in Canada and in the Republic of Paraguay, many of which are located in historically successful mining areas and have been the subject of past exploration and pre-extraction activities by other mining companies. We do not expect, however, to utilize ISR mining for all of the uranium mineral rights in which case we would expect to rely on conventional open pit and/or underground mining techniques.

Since we completed the acquisition of the Alto Paraná Titanium Project located in Paraguay in July 2017, we are also involved in titanium mining and related activities, including exploration, development, extraction and processing of titanium minerals such as ilmenite.

Our operating and strategic framework is based on expanding our uranium and titanium extraction activities, which includes advancing certain projects with established mineralized materials towards extraction, and establishing additional mineralized materials on our existing uranium and titanium projects or through the acquisition of additional projects.

During the six months ended January 31, 2020, we continued our strategic plan for reduced operations implemented in September 2013 to align our operations to a weak uranium market in a challenging post-Fukushima environment. As part of this strategy, we operated the Palangana Mine at a reduced pace to capture residual uranium only, while maintaining the Palangana Mine and Hobson Facility in a state of operational readiness. This strategy also included the deferral of major exploration and pre-extraction expenditures and maintaining our core exploration projects in good standing in anticipation of a recovery in uranium prices.

Results of Operations

For the three months ended January 31, 2020 and 2019, we recorded net losses of $1,888,661 ($0.01 per share) and $2,349,674 ($0.01 per share), respectively. For the six months ended January 31, 2020 and 2019, we recorded net losses of $6,931,238 ($0.04 per share) and $5,801,100 ($0.03 per share), respectively.

During the six months ended January 31, 2020, we continued with our strategic plan for reduced operations implemented in September 2013 and continued reduced operations at the Palangana Mine to capture residual pounds of U₃O₈ only. As a result, no U₃O₈ extraction or processing costs were capitalized to inventories during the three months ended January 31, 2020. At January 31, 2020, the total value of inventories was $211,662 (July 31, 2019: $211,662).

Costs and Expenses

For the three months ended January 31, 2020 and 2019, costs and expenses totaled $3,799,869 and $3,167,487, respectively, which were comprised of mineral property expenditures of $1,323,323 and $899,217, general and administrative expenses of $2,394,794 and $2,183,463, and depreciation, amortization and accretion of $81,752 and $84,807, respectively.

For the six months ended January 31, 2020 and 2019, costs and expenses totaled $7,714,876 and $6,381,441, respectively, which were comprised of mineral property expenditures of $2,846,774 and $1,765,460, general and administrative expenses of $4,709,964 and $4,442,398, and depreciation, amortization and accretion of $158,138 and $173,583, respectively.

Mineral Property Expenditures

Mineral property expenditures were primarily comprised of costs relating to permitting, property maintenance, exploration and pre-extraction activities and other non-extraction related activities on our projects.

During the three months ended January 31, 2020 and 2019, mineral property expenditures totaled $1,323,323 and $899,217, respectively, of which $301,114 and $298,576 were directly related to maintaining operational readiness and permitting compliance for our Palangana Mine and Hobson Processing Facility, respectively. During the six months ended January 31, 2020 and 2019, mineral property expenditures totaled $2,846,774 and $1,765,460, respectively, of which $650,249 and $602,219, respectively, were directly related to maintaining operational readiness and permitting compliance for the Palangana Mine and Hobson Processing Facility.

The following table provides mineral property expenditures on our projects for the periods indicated:

	Three Months Ended January 31,				Six Months Ended January 31,
	2020		2019		2020		2019
Mineral Property Expenditures
Palangana Mine	$	528,699	$	246,592	$	848,726	$	526,624
Goliad Project		36,843		19,056		96,807		37,878
Burke Hollow Project		220,812		166,469		869,673		275,014
Longhorn Project		2,289		10,157		12,446		25,533
Salvo Project		6,702		6,702		13,970		13,510
Anderson Project		13,433		15,056		29,486		37,270
Workman Creek Project		8,168		7,673		16,365		15,364
Slick Rock Project		13,271		12,206		26,405		29,430
Reno Creek Project		144,181		147,418		292,224		295,294
Yuty Project		16,718		62,600		30,914		86,003
Oviedo Project		123,117		40,758		229,055		61,483
Alto Paraná Titanium Project		110,085		34,429		166,333		60,262
Other Mineral Property Expenditures		99,005		130,101		214,370		301,795
	$	1,323,323	$	899,217	$	2,846,774	$	1,765,460

During the six months ended January 31, 2020, we drilled 26 exploration holes and 21 monitor wells totaling 21,069 feet, at our Burke Hollow Project. Since the commencement of the 2019 drilling campaign in March 2019, a total of 57 exploration and delineation holes and 72 monitor wells were completed.

General and Administrative

During the three and six months ended January 31, 2020, general and administrative expenses totaled $2,394,794 and $4,709,964, respectively, which increased by $211,331 and $267,566, respectively, compared to $2,183,463 and $4,442,398 for the three and six months ended January 31, 2019, primarily as a result of increased professional fees including legal fees related to certain transactional activities and audit and associated accounting fees.

The following summary provides a discussion of the major expense categories, including analyses of the factors that caused significant variances compared to the same periods last year:

●

for the three and six months ended January 31, 2020, salaries, management and consulting fees totaled $417,173 and $881,212, respectively, which were consistent with $428,354 and $926,463 for the three and six months ended January 31, 2019, respectively;

●

for the three and six months ended January 31, 2020, office, insurance, filing and listing fees, investor relations, corporate development and travel expenses totaled $852,664 and $1,651,776, respectively, which were consistent with $826,984 and $1,573,596 for the three and six months ended January 31, 2019, respectively;

●

for the three and six months ended January 31, 2020, professional fees totaled $326,707 and $461,340, respectively, which increased by $145,923 and $107,867, respectively, compared to $180,784 and $353,473 for the three and six months ended January 31, 2019. The increase in professional fees was primarily the result of legal fees for certain transactional activities and audit and associated accounting fees. Professional fees are primarily comprised of legal services related to certain transactional activities, regulatory compliance and ongoing legal claims, in addition to audit and tax services; and

●

for the three and six months ended January 31, 2020, stock-based compensation totaled $798,250 and $1,715,636, respectively, which were consistent with $747,342 and $1,588,866 for the three and six months ended January 31, 2019, respectively. During the three and six months ended January 31, 2020, we continued to utilize equity-based payments to compensate certain directors, officers, employees and consultants for services provided as part of our continuing efforts to reduce cash outlays. In July and August 2019, we granted approximately 2.5 million stock options, to our directors, officers, employees and certain consultants and, in July 2019 we awarded 465,000 RSUs and 445,000 PRSUs to certain of our directors and officers. The changes in stock-based compensation expenses represented the fair value of compensation shares issued and the amortization of the fair value of the stock awards over the vesting periods on an accelerated basis, resulting in a higher stock-based compensation expense being recognized at the beginning of the vesting periods than at the end of the vesting periods.

Depreciation, Amortization and Accretion

During the three and six months ended January 31, 2020, depreciation, amortization and accretion totaled $81,752 and $158,138, respectively, which were consistent compared to $84,807 and $173,583 for the three and six months ended January 31, 2019, respectively.

Depreciation, amortization and accretion include depreciation and amortization of long-term assets acquired in the normal course of operations and accretion of asset retirement obligations.

Other Income and Expenses

Interest and Finance Costs

During the three and six months ended January 31, 2020, interest and finance costs totaled $859,163 and $1,744,288, respectively, which increased by $45,354 and $175,630, compared to $813,809 and $1,568,658 for the three and six months ended January 31, 2019, respectively. The increases primarily resulted from an increased amortization of debt discount.

For the three months ended January 31, 2020 and 2019, interest and finance costs were primarily comprised of interest paid on long-term debt of $408,889 and $408,889, amortization of debt discount of $412,580 and $358,349, and amortization of annual surety bond premiums of $29,070 and $39,247, respectively.

For the six months ended January 31, 2020 and 2019, interest and finance costs were primarily comprised of interest paid on long-term debt of $817,778 and $817,778, amortization of debt discount of $844,801 and $666,120, and amortization of annual surety bond premiums of $63,696 and $70,475, respectively.

Income or Loss from Equity-Accounted Investment

During the three months ended January 31, 2020, URC completed its initial public offering which consisted of the issuance of 20,000,000 URC Units. URC is listed on the TSX Venture Exchange with the trading symbol URC.V.

As a consequence of the initial public offering and other private placements URC completed during the three and six months ended January 31, 2020, our ownership interest in URC decreased to 19.5% at January 31, 2020 from 32.6% at July 31, 2019, which resulted a dilution gain of $2,728,026 and $3,056,657, respectively, being recorded for the three and six months ended January 31, 2020. During the three and six months ended January 31, 2019, a loss of $15,941 and a gain of $356,774, respectively, were recorded as a result of the change in our ownership in URC.

During the three and six months ended January 31, 2020, we recorded a loss of $23,653 and $692,880, respectively, as a result of loss pickup from URC, compared to a loss pickup of $89,896 and $74,742 for the three and six months ended January 31, 2019, respectively.

Gain on Disposition of Assets

During the three and six months ended January 31, 2020, we recorded a gain of $1,800 and $1,800, respectively, on disposition of assets. During the three and six months ended January 31, 2019, we recorded a gain on disposition of assets of $1,583,764 and $1,583,764, respectively, primarily from the Company’s sale of certain royalty interests to URC.

Summary of Quarterly Results

	For the Quarters Ended
	January 31, 2020			October 31, 2019			July 31, 2019			April 30, 2019
Net loss	$	(1,888,661	)	$	(5,042,577	)	$	(6,334,132	)	$	(5,017,557	)
Total comprehensive loss		(1,928,309	)		(5,052,471	)		(6,199,949	)		(5,177,511	)
Basic and diluted loss per share		(0.01	)		(0.03	)		(0.04	)		(0.03	)
Total assets		96,514,311			96,696,496			101,040,242			105,055,912

	For the Quarters Ended
	January 31, 2019			October 31, 2018			July 31, 2018			April 30, 2018
Net loss	$	(2,349,674	)	$	(3,451,426	)	$	(4,770,335	)	$	(4,146,646	)
Total comprehensive loss		(2,311,442	)		(3,451,426	)		(4,652,380	)		(4,146,394	)
Basic and diluted loss per share		(0.01	)		(0.02	)		(0.03	)		(0.03	)
Total assets		106,958,178			108,046,108			89,611,309			88,958,320

Liquidity and Capital Resources

	January 31, 2020		July 31, 2019
Cash and cash equivalents	$	10,272,315	$	6,058,186
Term deposits		-		11,831,671
Current assets		12,068,244		19,709,933
Current liabilities		2,148,353		3,071,368
Working capital		9,919,891		16,638,565

At January 31, 2020, we had cash and cash equivalents of $10,272,315 and working capital of $9,919,891, which decreased by $6,718,674 from the working capital of $16,638,565 at July 31, 2019. By curtailing expenditures on discretionary and non-core activities, and paying certain management, consulting and service provider fees by the issuance of shares of the Company in lieu of cash, our existing cash resources and, if necessary, cash generated from the sale of the Company’s liquid assets, are expected to provide sufficient funds to carry out our planned operations for 12 months from the date of this Quarterly Report. Our continued operations, including the recoverability of the carrying values of our assets, are dependent ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations.

Historically, we have been reliant primarily on equity financings from the sale of our common stock and on debt financing in order to fund our operations. We have also relied, to a limited extent, on cash flows generated from our mining activities during Fiscal 2015, Fiscal 2013 and Fiscal 2012. However, we have yet to achieve profitability or develop positive cash flow from operations and we do not expect to achieve profitability or develop positive cash flow from operations in the near term. Our reliance on equity and debt financings is expected to continue for the foreseeable future, and their availability whenever such additional financing is required will be dependent on many factors beyond our control including, but not limited to, the market price of uranium, the continuing public support of nuclear power as a viable source of electrical generation, the volatility in the global financial markets affecting our stock price and the status of the worldwide economy, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets. We may also be required to seek other forms of financing, such as asset divestitures or joint venture arrangements to continue advancing our uranium projects which would depend entirely on finding a suitable third party willing to enter into such an arrangement, typically involving an assignment of a percentage interest in the mineral project. However, there is no assurance that we will be successful in securing any form of additional financing when required and on terms favorable to us.

Our operations are capital intensive and future capital expenditures are expected to be substantial. We will require significant additional financing to fund our operations, including continuing with our exploration and pre-extraction activities and acquiring additional mineral projects. In the absence of such additional financing, we would not be able to fund our operations, including continuing with our exploration and pre-extraction activities, which may result in delays, curtailment or abandonment of any one or all of our mineral projects.

Our anticipated operations, including exploration and pre-extraction activities, will be dependent on and may change as a result of our financial position, the market price of uranium and other considerations, and such change may include accelerating the pace or broadening the scope of reducing our operations as originally announced in September 2013.

Our ability to secure adequate funding for these activities will be impacted by our operating performance, other uses of cash, the market price of commodities, the market price of our common stock and other factors which may be beyond our control. Specific examples of such factors include, but are not limited to:

●

if the weakness in the market price of uranium experienced in Fiscal 2019 continues or weakens further during Fiscal 2020;

●

if the weakness in the market price of our common stock experienced in Fiscal 2019 continues or weakens further during Fiscal 2020;

●

if we default on making scheduled payments of fees and complying with the restrictive covenants as required under our Credit Facility, and it results in accelerated repayment of our indebtedness and/or enforcement by the Lenders against our key assets securing our indebtedness; and

●

if another nuclear incident, such as the events that occurred at Fukushima in March 2011, were to occur during Fiscal 2020, continuing public support of nuclear power as a viable source of electrical generation may be adversely affected, which may result in significant and adverse effects on both the nuclear and uranium industries.

Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional mineral projects and to continue with exploration and pre-extraction activities and mining activities on our existing mineral projects, will depend ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations by establishing ore bodies that contain commercially recoverable minerals and to develop these into profitable mining activities.

Equity Financings

We filed a Form S-3 shelf registration statement under the United States Securities Act of 1933, as amended (the “Securities Act”), which was declared effective on March 10, 2017 (the “2017 Shelf”), providing for the public offer and sale of certain securities of our Company from time to time, at our discretion, of up to an aggregate offering amount of $100 million.

As at April 7, 2019, a total of $68.4 million of the 2017 Shelf was utilized through the registration of our shares of common stock underlying outstanding common share purchase warrants from previous registered offerings with a remaining available balance of $31.6 million under the 2017 Shelf. On April 8, 2019 we filed an additional Form S-3 shelf registration statement pursuant to Rule 462(b) of the Securities Act, which became effective upon filing on April 8, 2019, providing for the public offer and sale of certain additional securities of our Company representing an additional 20%, or $6.3 million, of the then remaining $31.6 million available under the 2017 Shelf, which increased the remaining amount available under the 2017 Shelf to $37.9 million.

On April 9, 2019, we entered into an At The Market Offering Agreement (the “Offering Agreement”) with H.C. Wainwright & Co., LLC (as the “Lead Manager”) and the co-managers set forth on the signature page of the Offering Agreement (each, a “Co-Manager” and, collectively, with the Lead Manager, the “Managers”); under which the Company may, from time to time, sell shares of its common stock having an aggregate offering price of up to $37.9 million through the Managers (collectively, the “ATM”). In connection with the ATM, on April 9, 2019, we filed a prospectus supplement to the 2017 Shelf providing for the public offer and sale of the Company’s shares having an aggregate offering price of up to $37.9 million through one or more at-the-market offerings pursuant to the ATM. At January 31, 2020, no public offer or sale of the Company’s shares has been completed under the ATM.

As at January 31, 2020, all $106.3 million under the 2017 Shelf was utilized through the registration of our shares of common stock and shares of common stock underlying outstanding common share purchase warrants from previous registered offerings as well as our shares of common stock to be sold under the ATM.

On February 21, 2020, we filed a Form S-3 shelf registration statement under the Securities Act which was declared effective by the SEC on March 3, 2020 (the “2020 Shelf”) and, as a result, our 2017 Shelf is deemed terminated as well as the ATM is deemed terminated unless we enter into an ATM under the 2020 Shelf. The 2020 Shelf provides for the public offer and sale of certain securities of the Company from time to time, at our discretion, up to an aggregate offering amount of $100 million.

Debt Financing

On December 5, 2018, we entered into the Third Amended and Restated Credit Agreement with our Lenders, whereby we and the Lenders agreed to certain further amendments to the Credit Facility, under which initial funding of $10,000,000 was received by the Company upon closing of the Credit Facility on July 30, 2013, and additional funding of $10,000,000 was received by the Company upon closing of the amended Credit Facility on March 13, 2014. The Credit Facility is non-revolving with an amended term of 8.5 years maturing on January 31, 2022, subject to an interest rate of 8% per annum, compounded and payable on a monthly basis.

The Third Credit Amended and Restated Agreement superseded, in their entirety, the Second Amended and Restated Credit Agreement dated and effective February 9, 2016, the Amended and Restated Credit Agreement dated and effective March 13, 2014 and the Credit Agreement dated and effective July 30, 2013 with our Lenders.

During the three months ended January 31, 2020, and pursuant to the terms of the Third Amended and Restated Credit Agreement, we issued an aggregate of 1,743,462 shares to our Lenders, with a fair value of $1,400,000, representing 7% of the $20,000,000 principal balance outstanding at October 31, 2019, as payment of anniversary fees to our Lenders.

Refer to Note 9: Long-Term Debt of the Notes to the Condensed Consolidated Financial Statements for the six months ended January 31, 2020 and Note 10: Long-Term Debt of the Notes to the Consolidated Financial Statements for Fiscal 2019.

Operating Activities

Net cash used in operating activities during the six months ended January 31, 2020 and 2019 was $7,545,794 and $6,313,701, respectively. Significant operating expenditures included mineral property expenditures, general and administrative expenses and interest payments.

Financing Activities

No cash was provided from financing activities during the six months ended January 31, 2020. During the six months ended January 31, 2019, net cash provided by financing activities was $21,538,191 from our October 2018 offering of 12,613,049 units at a price of $1.60 per unit.

Investing Activities

During the six months ended January 31, 2020, net cash provided by the investing activities totaled $11,773,277, primarily from cash received from the redemption of term deposits totaling $11,831,671, offset by cash used for the investment in mineral rights and properties of $30,000 and cash used for the purchase of property, plant and equipment of $30,194. During the six months ended January 31, 2019, net cash used in investing activities totaled $18,146,060, primarily for the investment in term deposits of $18,026,455, investment in mineral rights and properties of $105,000 and purchase of property, plant and equipment of $19,505.

Stock Options and Warrants

At January 31, 2020, we had stock options outstanding representing 10,286,625 shares at a weighted-average exercise price of $1.25 per share and share purchase warrants outstanding representing 7,721,981 shares at a weighted-average exercise price of $2.03 per share. At January 31, 2020, outstanding stock options and warrants represented a total 18,008,606 shares issuable for gross proceeds of approximately $28.5 million should these stock options and warrants be exercised in full on a cash basis. At January 31, 2020, there were no outstanding in-the-money stock options or warrants. The exercise of stock options and warrants is at the discretion of the respective holders and, accordingly, there is no assurance that any of the stock options or warrants will be exercised in the future.

Transactions with a Related Party

During the three and six months ended January 31, 2020 and 2019, we incurred $35,657 and $40,017(six months ended January 31, 2020 and 2019: $68,490 and $77,721), respectively, in general and administrative costs paid to Blender, a company controlled by Arash Adnani, a direct family member of our President and Chief Executive Officer, for various services including information technology, corporate branding, media, website design, maintenance and hosting, provided to the Company.

At January 31, 2020, the amount owing to Blender was $32,306 (July 31, 2019: $68,680).

Material Commitments

Long-Term Debt Obligations

At January 31, 2020, we have made all scheduled payments and complied with all covenants under our Credit Facility, and we expect to continue complying with all scheduled payments and covenants during Fiscal 2020.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies

For a complete summary of all of our significant accounting policies, refer to Note 2: Summary of Significant Accounting Policies of the Notes to the Consolidated Financial Statements as presented under Item 8, Financial Statements and Supplementary Data in our Form 10-K Annual Report for Fiscal 2019.

Refer to “Critical Accounting Policies” under Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K Annual Report for Fiscal 2019.

Subsequent Events

On February 21, 2020, we filed the 2020 Shelf which was declared effective by the SEC on March 3, 2020, and, as a result, our 2017 Shelf is deemed terminated as well as the ATM is deemed terminated unless we enter into an ATM under the 2020 Shelf. The 2020 Shelf provides for the public offer and sale of certain securities of the Company from time to time, at our discretion, up to an aggregate offering amount of $100 million.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Refer to Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Form 10-K Annual Report for Fiscal 2019.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Principal Executive Officer and Principal Financial Officer, has evaluated the effectiveness of our internal controls over financial reporting and disclosure controls and procedures (as such terms are defined in Rules 13a-15(e) and 15d-15(e) under the United States Securities Exchange Act of 1933, as amended (the “Exchange Act”) as of the end of the period covered by this Quarterly Report, our Principal Executive Officer and Principal Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were ineffective.

In our assessment of the effectiveness of our Company’s internal control over financial reporting as at July 31, 2019, material weaknesses were identified in assessing the complexity of the valuation and accounting of a significant non-routine transaction, in a control surrounding information technology general control (“ITGC”), and in our Risk Assessment and Control Activity components of the COSO Framework related to the aggregation of open control deficiencies across our financial reporting process. In particular, the design and documentation of controls around: (i) testing the Company’s code of conduct; (ii) the adoption of new accounting standards; and (iii) accounting for our equity-accounted investment were insufficient. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements could not be prevented or detected on a timely basis.

During the quarter ended October 31, 2019, in response to the material weakness relating to ITGC, we reassigned and restricted certain access rights of a senior financial person to our accounting system for sufficient segregation of duties. As a result, the material weakness relating to ITGC has been remediated as of October 31, 2019. In addition, we have redesigned the control procedures surrounding non-routine transactions. However, the Company’s management will not consider the material weakness surrounding non-routine transactions remediated until the remedial control procedures operate for a period of time and the control procedures are tested to ensure they are operating effectively.

During the quarter ended January 31, 2020, in response to the material weakness in our Risk Assessment and Control Activity components of the COSO Framework, a new control was designed and implemented for the review of the Company’s Code of Conduct. As a result, the control deficiency relating to the testing of the Company’s Code of Conduct has been remediated as of January 31, 2020. In addition, we have redesigned and implemented new control procedures for accounting for the equity-accounted investment. However, the Company’s management will not consider this remediated until the control procedures operate for a period of time and the control procedures are tested to ensure they are operating effectively.

As these remedial actions have been implemented but have not operated for a sufficient period of time or instances, or have not been tested, our Principal Executive Officer and Principal Financial Officer have concluded that the disclosure controls and procedures cannot be deemed effective at a level that provides reasonable assurance as of the date of this Quarterly Report.

It should be noted that any system of controls is based in part upon certain assumptions designed to obtain reasonable (and not absolute) assurance as to its effectiveness, and there can be no assurance that any design will succeed in achieving its stated goals.

Changes in Internal Controls

Except for the remediation procedures described above, there have been no other changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our fiscal quarter ended January 31, 2020, that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

As of the date of this Quarterly Report, other than as disclosed below, there are no material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which the Company or any of its subsidiaries is a party or of which any of their property is subject, and no director, officer, affiliate or record or beneficial owner of more than 5% of our common stock, or any associate or any such director, officer, affiliate or security holder is: (i) a party adverse to us or any of our subsidiaries in any legal proceeding; or (ii) has an adverse interest to us or any of our subsidiaries in any legal proceeding. Other than as disclosed below, management is not aware of any other material legal proceedings pending or that have been threatened against us or our properties.

On or about March 9, 2011, the TCEQ granted the Company’s applications for a Class III Injection Well Permit, Production Area Authorization and Aquifer Exemption for its Goliad Project. On or about December 4, 2012, the U.S. Environmental Protection Agency (the “EPA”) concurred with the TCEQ issuance of the Aquifer Exemption permit (the “AE”). With the receipt of this concurrence, the final authorization required for uranium extraction, the Goliad Project achieved fully-permitted status. On or about May 24, 2011, a group of petitioners, inclusive of Goliad County, appealed the TCEQ action to the 250^th District Court in Travis County, Texas. A motion filed by the Company to intervene in this matter was granted. The petitioners’ appeal lay dormant until on or about June 14, 2013, when the petitioners filed their initial brief in support of their position. On or about January 18, 2013, a different group of petitioners, exclusive of Goliad County, filed a petition for review with the Court of Appeals for the Fifth Circuit in the United States (the “Fifth Circuit”) to appeal the EPA’s decision. On or about March 5, 2013, a motion filed by the Company to intervene in this matter was granted. The parties attempted to resolve both appeals, to facilitate discussions and avoid further legal costs. The parties jointly agreed, through mediation initially conducted through the Fifth Circuit on or about August 8, 2013, to abate the proceedings in the State District Court. On or about August 21, 2013, the State District Court agreed to abate the proceedings. The EPA subsequently filed a motion to remand without vacatur with the Fifth Circuit wherein the EPA’s stated purpose was to elicit additional public input and further explain its rationale for the approval. In requesting the remand without vacatur, which would allow the AE to remain in place during the review period, the EPA denied the existence of legal error and stated that it was unaware of any additional information that would merit reversal of the AE. The Company and the TCEQ filed a request to the Fifth Circuit for the motion to remand without vacatur, and if granted, to be limited to a 60-day review period. On December 9, 2013, by way of a procedural order from a three-judge panel of the Fifth Circuit, the Court granted the remand without vacatur and initially limited the review period to 60 days. In March of 2014, at the EPA’s request, the Fifth Circuit extended the EPA’s time period for review and additionally, during that same period, the Company conducted a joint groundwater survey of the site, the result of which reaffirmed the Company’s previously filed groundwater direction studies. On or about June 17, 2014, the EPA reaffirmed its earlier decision to uphold the granting of the Company’s existing AE, with the exception of a northwestern portion containing less than 10% of the uranium resource which was withdrawn, but not denied, from the AE area until additional information is provided in the normal course of mine development. On or about September 9, 2014, the petitioners filed a status report with the State District Court which included a request to remove the stay agreed to in August 2013 and to set a briefing schedule (the “Status Report”). In that Status Report the petitioners also stated that they had decided not to pursue their appeal at the Fifth Circuit. The Company continues to believe that the pending appeal is without merit and is continuing as planned towards uranium extraction at its fully-permitted Goliad Project.

The Company has had communications and filings with the MOPC, the mining regulator in Paraguay, whereby the MOPC is taking the position that certain concessions forming part of the Company’s Yuty and Alto Parana projects are not eligible for extension as to exploration or continuation to exploitation in their current stages. While the Company remains fully committed to its development path forward in Paraguay, it caused its legal counsel to file an appeal in Paraguay to reverse the MOPC’s position in order to protect the Company’s continuing rights in those concessions.

Item 1A. Risk Factors

In addition to the information contained in our Form 10-K Annual Report for Fiscal 2019, and this Form 10-Q Quarterly Report, we have identified the following material risks and uncertainties which reflect our outlook and conditions known to us as of the date of this Quarterly Report. These material risks and uncertainties should be carefully reviewed by our stockholders and any potential investors in evaluating the Company, our business and the market value of our common stock. Furthermore, any one of these material risks and uncertainties has the potential to cause actual results, performance, achievements or events to be materially different from any future results, performance, achievements or events implied, suggested or expressed by any forward-looking statements made by us or by persons acting on our behalf. Refer to “Cautionary Note Regarding Forward-looking Statements” as disclosed in our Form 10-K Annual Report for Fiscal 2019.

There is no assurance that we will be successful in preventing the material adverse effects that any one or more of the following material risks and uncertainties may cause on our business, prospects, financial condition and operating results, which may result in a significant decrease in the market price of our common stock. Furthermore, there is no assurance that these material risks and uncertainties represent a complete list of the material risks and uncertainties facing us. There may be additional risks and uncertainties of a material nature that, as of the date of this Quarterly Report, we are unaware of or that we consider immaterial that may become material in the future, any one or more of which may result in a material adverse effect on us. You could lose all or a significant portion of your investment due to any one of these material risks and uncertainties.

Risks Related to Our Company and Business

Evaluating our future performance may be difficult since we have a limited financial and operating history, with significant negative cash flow and accumulated deficit to date. Our long-term success will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our mining activities.

As more fully described under Item 1, Business in our Form 10-K Annual Report for Fiscal 2019, we were incorporated under the laws of the State of Nevada on May 16, 2003, and since 2004, we have been predominantly engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on projects located in the United States and Paraguay. In November 2010, we commenced uranium extraction for the first time at the Palangana Mine utilizing ISR and processed those materials at the Hobson Processing Facility into drums of U₃O₈, our only sales product and source of revenue. We also hold uranium projects in various stages of exploration and pre-extraction in the States of Arizona, Colorado, New Mexico, Texas and Wyoming, in Canada and the Republic of Paraguay. Since we completed the acquisition of the Alto Paraná Project located in the Republic of Paraguay in July 2017, we are also involved in mining and related activities, including exploration, pre-extraction, extraction and processing of titanium minerals.

As more fully described under “Liquidity and Capital Resources” of Item 2, Management’s Discussion and Analysis of Financial Condition and Result of Operations, we have a history of significant negative cash flow and net losses, with an accumulated deficit balance since inception of $269.1 million at January 31, 2020. Historically, we have been reliant primarily on equity financings from the sale of our common stock and on debt financing in order to fund our operations. Although we generated revenues from sales of U₃O₈ during Fiscal 2015, Fiscal 2013 and Fiscal 2012 of $3.1 million, $9.0 million and $13.8 million, respectively, with no revenues from sales of U₃O₈ generated during the six months ended January 31, 2020, Fiscal 2016 to Fiscal 2019, Fiscal 2014 or for any periods prior to Fiscal 2012, we have yet to achieve profitability or develop positive cash flow from our operations, and we do not expect to achieve profitability or develop positive cash flow from operations in the near term. As a result of our limited financial and operating history, including our significant negative cash flow and net losses to date, it may be difficult to evaluate our future performance.

At January 31, 2020, we had cash and cash equivalents of $10.3 million and working capital of $9.9 million. By curtailing expenditures on discretionary and non-core activities, and paying certain management, consulting and service provider fees by issuance of shares of the Company in lieu of cash, our existing cash resources and, if necessary, cash generated from the sale of the Company’s liquid assets, are expected to provide sufficient funds to carry out our planned operations for 12 months from the date of this Quarterly Report. As we do not expect to achieve and maintain profitability in the near term, our continuation as a going concern is dependent upon our ability to obtain adequate additional financing which we have successfully secured since our inception, including those from asset divestitures. Our continued operations, including the recoverability of the carrying values of our assets, are dependent ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations.

Our reliance on equity and debt financings is expected to continue for the foreseeable future, and their availability whenever such additional financing is required, will be dependent on many factors beyond our control including, but not limited to, the market price of uranium, the continuing public support of nuclear power as a viable source of electrical generation, the volatility in the global financial markets affecting our stock price and the status of the worldwide economy, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets. We may also be required to seek other forms of financing, such as asset divestitures or joint venture arrangements to continue advancing our uranium projects which would depend entirely on finding a suitable third party willing to enter into such an arrangement, typically involving an assignment of a percentage interest in the mineral project.

Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional uranium projects and continue with exploration and pre-extraction activities and mining activities on our existing uranium projects, will depend ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations by establishing ore bodies that contain commercially recoverable uranium and to develop these into profitable mining activities. The economic viability of our mining activities, including the expected duration and profitability of the Palangana Mine and of any future satellite ISR mines, such as the Burke Hollow and Goliad Projects, located within the South Texas Uranium Belt, and the Reno Creek Project located in the Powder River Basin, Wyoming, and our projects in Canada and in the Republic of Paraguay, have many risks and uncertainties. These include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium and titanium minerals; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected mineral extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vi) the introduction of significantly more stringent regulatory laws and regulations. Our mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in achieving and maintaining profitability and developing positive cash flow.

Our operations are capital intensive and we will require significant additional financing to acquire additional mineral projects and continue with our exploration and pre-extraction activities on our existing projects.

Our operations are capital intensive and future capital expenditures are expected to be substantial. We will require significant additional financing to fund our operations, including acquiring additional projects and continuing with our exploration and pre-extraction activities which include assaying, drilling, geological and geochemical analysis and mine construction costs. In the absence of such additional financing we would not be able to fund our operations or continue with our exploration and pre-extraction activities, which may result in delays, curtailment or abandonment of any one or all of our projects.

If we are unable to service our indebtedness, we may be faced with accelerated repayments or lose the assets securing our indebtedness. Furthermore, restrictive covenants governing our indebtedness may restrict our ability to pursue our business strategies.

On December 5, 2018, we entered into the Third Amended and Restated Credit Agreement with our Lenders under which we had previously drawn down the maximum $20 million in principal. The Credit Facility requires monthly interest payments calculated at 8% per annum and other periodic fees. Our ability to continue making these scheduled payments will be dependent on and may change as a result of our financial condition and operating results. Failure to make any of these scheduled payments will put us in default with the Credit Facility which, if not addressed or waived, could require accelerated repayment of our indebtedness and/or enforcement by the Lenders against our assets. Enforcement against our assets would have a material adverse effect on our financial condition and operating results.

Furthermore, our Credit Facility includes restrictive covenants that, among other things, limit our ability to sell our assets or to incur additional indebtedness other than permitted indebtedness, which may restrict our ability to pursue certain business strategies from time to time. If we do not comply with these restrictive covenants, we could be in default which, if not addressed or waived, could require accelerated repayment of our indebtedness and/or enforcement by the Lenders against our assets.

Our uranium extraction and sales history is limited, with our uranium extraction to date originating from a single uranium mine. Our ability to continue generating revenue is subject to a number of factors, any one or more of which may adversely affect our financial condition and operating results.

We have a limited history of uranium extraction and generating revenue. In November 2010, we commenced uranium extraction at the Palangana Mine, which has been our sole source of U₃O₈ sold to generate the revenues during Fiscal 2015, Fiscal 2013 and Fiscal 2012 of $3.1 million, $9.0 million and $13.8 million, respectively, with no revenues from sales of U₃O₈ generated during the six months ended January 31, 2020, Fiscal 2016 to Fiscal 2019, Fiscal 2014 or for any periods prior to Fiscal 2012.

During the three and six months ended January 31, 2020, we continued to operate the Palangana Mine at a reduced pace since implementing our strategic plan in September 2013 to align our operations to a weak uranium commodity market in a challenging post-Fukushima environment. This strategy has included the deferral of major pre-extraction expenditures and remaining in a state of operational readiness in anticipation of a recovery in uranium prices. Our ability to continue generating revenue from the Palangana Mine is subject to a number of factors which include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. Furthermore, continued mining activities at the Palangana Mine will eventually deplete the Palangana Mine or cause such activities to become uneconomical, and if we are unable to directly acquire or develop existing uranium projects, such as our Burke Hollow and Goliad Projects, into additional uranium mines from which we can commence uranium extraction, it will negatively impact our ability to generate revenues. Any one or more of these occurrences may adversely affect our financial condition and operating results.

Exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, and actual results may differ significantly from expectations or anticipated amounts. Furthermore, exploration programs conducted on our projects may not result in the establishment of ore bodies that contain commercially recoverable uranium.

Exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, with many beyond our control and including, but not limited to: (i) unanticipated ground and water conditions and adverse claims to water rights; (ii) unusual or unexpected geological formations; (iii) metallurgical and other processing problems; (iv) the occurrence of unusual weather or operating conditions and other force majeure events; (v) lower than expected ore grades; (vi) industrial accidents; (vii) delays in the receipt of or failure to receive necessary government permits; (viii) delays in transportation; (ix) availability of contractors and labor; (x) government permit restrictions and regulation restrictions; (xi) unavailability of materials and equipment; and (xii) the failure of equipment or processes to operate in accordance with specifications or expectations. These risks and uncertainties could result in: (i) delays, reductions or stoppages in our mining activities; (ii) increased capital and/or extraction costs; (iii) damage to, or destruction of, our mineral projects, extraction facilities or other properties; (iv) personal injuries; (v) environmental damage; (vi) monetary losses; and (vii) legal claims.

Success in mineral exploration is dependent on many factors, including, without limitation, the experience and capabilities of a company’s management, the availability of geological expertise and the availability of sufficient funds to conduct the exploration program. Even if an exploration program is successful and commercially recoverable material is established, it may take a number of years from the initial phases of drilling and identification of the mineralization until extraction is possible, during which time the economic feasibility of extraction may change such that the material ceases to be economically recoverable. Exploration is frequently non-productive due, for example, to poor exploration results or the inability to establish ore bodies that contain commercially recoverable material, in which case the project may be abandoned and written-off. Furthermore, we will not be able to benefit from our exploration efforts and recover the expenditures that we incur on our exploration programs if we do not establish ore bodies that contain commercially recoverable material and develop these projects into profitable mining activities, and there is no assurance that we will be successful in doing so for any of our projects.

Whether an ore body contains commercially recoverable material depends on many factors including, without limitation: (i) the particular attributes, including material changes to those attributes, of the ore body such as size, grade, recovery rates and proximity to infrastructure; (ii) the market price of uranium, which may be volatile; and (iii) government regulations and regulatory requirements including, without limitation, those relating to environmental protection, permitting and land use, taxes, land tenure and transportation.

We have not established proven or probable reserves through the completion of a “final” or “bankable” feasibility study for any of our projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing ISR mining, such as the Palangana Mine. Since we commenced extraction of mineralized materials from the Palangana Mine without having established proven or probable reserves, it may result in our mining activities at the Palangana Mine, and at any future projects for which proven or probable reserves are not established, being inherently riskier than other mining activities for which proven or probable reserves have been established.

We have established the existence of mineralized materials for certain projects, including the Palangana Mine. We have not established proven or probable reserves, as defined by the SEC under Industry Guide 7, through the completion of a “final” or “bankable” feasibility study for any of our projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our projects for which we plan on utilizing ISR mining, such as the Palangana Mine. Since we commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated. Any mineralized materials established or extracted from the Palangana Mine should not in any way be associated with having established or produced from proven or probable reserves.

Since we are in the Exploration Stage, pre-production expenditures including those related to pre-extraction activities are expensed as incurred, the effects of which may result in our consolidated financial statements not being directly comparable to the financial statements of companies in the Production Stage.

Despite the fact that we commenced uranium extraction at the Palangana Mine in November 2010, we remain in the Exploration Stage as defined under Industry Guide 7, and will continue to remain in the Exploration Stage until such time proven or probable reserves have been established, which may never occur. We prepare our consolidated financial statements in accordance with U.S. GAAP under which acquisition costs of mineral rights are initially capitalized as incurred while pre-production expenditures are expensed as incurred until such time we exit the Exploration Stage. Expenditures relating to exploration activities are expensed as incurred and expenditures relating to pre-extraction activities are expensed as incurred until such time proven or probable reserves are established for that uranium project, after which subsequent expenditures relating to mine development activities for that particular project are capitalized as incurred.

We have neither established nor have any plans to establish proven or probable reserves for our uranium projects for which we plan on utilizing ISR mining, such as the Palangana Mine. Companies in the Production Stage as defined by the SEC under Industry Guide 7, having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. As we are in the Exploration Stage, it has resulted in us reporting larger losses than if we had been in the Production Stage due to the expensing, instead of capitalization, of expenditures relating to ongoing mill and mine pre-extraction activities. Additionally, there would be no corresponding amortization allocated to our future reporting periods since those costs would have been expensed previously, resulting in both lower inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if we had been in the Production Stage. Any capitalized costs, such as acquisition costs of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage.

Estimated costs of future reclamation obligations may be significantly exceeded by actual costs incurred in the future. Furthermore, only a portion of the financial assurance required for the future reclamation obligations has been funded.

We are responsible for certain remediation and decommissioning activities in the future primarily for our Hobson Processing Facility, Palangana Mine, Reno Creek Project and Alto Paraná Project and have recorded a liability of $3.6 million on our balance sheet at January 31, 2020, to recognize the present value of the estimated costs of such reclamation obligations. Should the actual costs to fulfill these future reclamation obligations materially exceed these estimated costs, it may have an adverse effect on our financial condition and operating results, including not having the financial resources required to fulfill such obligations when required to do so.

During Fiscal 2015, we secured $5.6 million of surety bonds as an alternate source of financial assurance for the estimated costs of the reclamation obligations of our Hobson Processing Facility and Palangana Mine, of which we have $1.7 million funded and held as restricted cash for collateral purposes as required by the surety. We may be required at any time to fund the remaining $3.9 million or any portion thereof for a number of reasons including, but not limited to, the following: (i) the terms of the surety bonds are amended, such as an increase in collateral requirements; (ii) we are in default with the terms of the surety bonds; (iii) the surety bonds are no longer acceptable as an alternate source of financial assurance by the regulatory authorities; or (iv) the surety encounters financial difficulties. Should any one or more of these events occur in the future, we may not have the financial resources to fund the remaining amount or any portion thereof when required to do so.

We do not insure against all of the risks we face in our operations.

In general, where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. We currently maintain insurance against certain risks including securities and general commercial liability claims and certain physical assets used in our operations, subject to exclusions and limitations, however, we do not maintain insurance to cover all of the potential risks and hazards associated with our operations. We may be subject to liability for environmental, pollution or other hazards associated with our exploration, pre-extraction and extraction activities, which we may not be insured against, which may exceed the limits of our insurance coverage or which we may elect not to insure against because of high premiums or other reasons. Furthermore, we cannot provide assurance that any insurance coverage we currently have will continue to be available at reasonable premiums or that such insurance will adequately cover any resulting liability.

Acquisitions that we may make from time to time could have an adverse impact on us.

From time to time, we examine opportunities to acquire additional mining assets and businesses. Any acquisition that we may choose to complete may be of a significant size, may change the scale of our business and operations, and may expose us to new geographic, political, operating, financial and geological risks. Our success in our acquisition activities depends on our ability to identify suitable acquisition candidates, negotiate acceptable terms for any such acquisition, and integrate the acquired operations successfully with those of our Company. Any acquisitions would be accompanied by risks which could have a material adverse effect on our business. For example: (i) there may be a significant change in commodity prices after we have committed to complete the transaction and established the purchase price or exchange ratio; (ii) a material ore body may prove to be below expectations; (iii) we may have difficulty integrating and assimilating the operations and personnel of any acquired companies, realizing anticipated synergies and maximizing the financial and strategic position of the combined enterprise, and maintaining uniform standards, policies and controls across the organization; (iv) the integration of the acquired business or assets may disrupt our ongoing business and our relationships with employees, customers, suppliers and contractors; and (v) the acquired business or assets may have unknown liabilities which may be significant. In the event that we choose to raise debt capital to finance any such acquisition, our leverage will be increased. If we choose to use equity as consideration for such acquisition, existing shareholders may suffer dilution. Alternatively, we may choose to finance any such acquisition with our existing resources. There can be no assurance that we would be successful in overcoming these risks or any other problems encountered in connection with such acquisitions.

The uranium industry is subject to numerous stringent laws, regulations and standards, including environmental protection laws and regulations. If any changes occur that would make these laws, regulations and standards more stringent, it may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

Uranium exploration and pre-extraction programs and mining activities are subject to numerous stringent laws, regulations and standards at the federal, state and local levels governing permitting, pre-extraction, extraction, exports, taxes, labor standards, occupational health, waste disposal, protection and reclamation of the environment, protection of endangered and protected species, mine safety, hazardous substances and other matters. Our compliance with these requirements requires significant financial and personnel resources.

The laws, regulations, policies or current administrative practices of any government body, organization or regulatory agency in the United States or any other applicable jurisdiction, may change or be applied or interpreted in a manner which may also have a material adverse effect on our operations. The actions, policies or regulations, or changes thereto, of any government body or regulatory agency or special interest group, may also have a material adverse effect on our operations.

Uranium exploration and pre-extraction programs and mining activities are subject to stringent environmental protection laws and regulations at the federal, state, and local levels. These laws and regulations include permitting and reclamation requirements, regulate emissions, water storage and discharges and disposal of hazardous wastes. Uranium mining activities are also subject to laws and regulations which seek to maintain health and safety standards by regulating the design and use of mining methods. Various permits from governmental and regulatory bodies are required for mining to commence or continue, and no assurance can be provided that required permits will be received in a timely manner.

Our compliance costs including the posting of surety bonds associated with environmental protection laws and regulations and health and safety standards have been significant to date and are expected to increase in scale and scope as we expand our operations in the future. Furthermore, environmental protection laws and regulations may become more stringent in the future, and compliance with such changes may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

To the best of our knowledge, our operations are in compliance, in all material respects, with all applicable laws, regulations and standards. If we become subject to liability for any violations, we may not be able or may elect not to insure against such risk due to high insurance premiums or other reasons. Where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. However, we cannot provide any assurance that such insurance will continue to be available at reasonable premiums or that such insurance will be adequate to cover any resulting liability.

We may not be able to obtain, maintain or amend rights, authorizations, licenses, permits or consents required for our operations.

Our exploration and mining activities are dependent upon the grant of appropriate rights, authorizations, licences, permits and consents, as well as continuation and amendment of these rights, authorizations, licences, permits and consents already granted, which may be granted for a defined period of time, or may not be granted or may be withdrawn or made subject to limitations. There can be no assurance that all necessary rights, authorizations, licences, permits and consents will be granted to us, or that authorizations, licences, permits and consents already granted will not be withdrawn or made subject to limitations.

Major nuclear incidents may have adverse effects on the nuclear and uranium industries.

The nuclear incident that occurred in Japan in March 2011 had significant and adverse effects on both the nuclear and uranium industries. If another nuclear incident were to occur, it may have further adverse effects for both industries. Public opinion of nuclear power as a source of electrical generation may be adversely affected, which may cause governments of certain countries to further increase regulation for the nuclear industry, reduce or abandon current reliance on nuclear power or reduce or abandon existing plans for nuclear power expansion. Any one of these occurrences has the potential to reduce current and/or future demand for nuclear power, resulting in lower demand for uranium and lower market prices for uranium, adversely affecting the operations and prospects of us. Furthermore, the growth of the nuclear and uranium industries is dependent on continuing and growing public support of nuclear power as a viable source of electrical generation.

The marketability of uranium concentrates will be affected by numerous factors beyond our control which may result in our inability to receive an adequate return on our invested capital.

The marketability of uranium concentrates extracted by us will be affected by numerous factors beyond our control. These factors include macroeconomic factors, fluctuations in the market price of uranium, governmental regulations, land tenure and use, regulations concerning the importing and exporting of uranium and environmental protection regulations. The future effects of these factors cannot be accurately predicted, but any one or a combination of these factors may result in our inability to receive an adequate return on our invested capital.

The titanium industry is affected by global economic factors, including risks associated with volatile economic conditions, and the market for many titanium products is cyclical and volatile, and we may experience depressed market conditions for such products.

Titanium is used in many "quality of life" products for which demand historically has been linked to global, regional and local GDP and discretionary spending, which can be negatively impacted by regional and world events or economic conditions. Such events are likely to cause a decrease in demand for products and, as a result, may have an adverse effect on our results of operations and financial condition. The timing and extent of any changes to currently prevailing market conditions is uncertain, and supply and demand may be unbalanced at any time. Uncertain economic conditions and market instability make it particularly difficult for us to forecast demand trends. As a consequence, we may not be able to accurately predict future economic conditions or the effect of such conditions on our financial condition or results of operations. We can give no assurances as to the timing, extent or duration of the current or future economic cycles impacting the industries in which we operate.

Historically, the market for large volume titanium applications, including coatings, paper and plastics, has experienced alternating periods of tight supply, causing prices and margins to increase, followed by periods of lower capacity utilization resulting in declining prices and margins. The volatility this market experiences occurs as a result of significant changes in the demand for products as a consequence of global economic activity and changes in customers’ requirements. The supply-demand balance is also impacted by capacity additions or reductions that result in changes of utilization rates. In addition, titanium margins are impacted by significant changes in major input costs such as energy and feedstock. Demand for titanium depends in part on the housing and construction industries. These industries are cyclical in nature and have historically been impacted by downturns in the economy. In addition, pricing may affect customer inventory levels as customers may from time to time accelerate purchases of titanium in advance of anticipated price increases or defer purchases of titanium in advance of anticipated price decreases. The cyclicality and volatility of the titanium industry results in significant fluctuations in profits and cash flow from period to period and over the business cycle.

The uranium and titanium industries are highly competitive and we may not be successful in acquiring additional projects.

The uranium industry is highly competitive, and our competition includes larger, more established companies with longer operating histories that not only explore for and produce uranium, but also market uranium and other products on a regional, national or worldwide basis. Due to their greater financial and technical resources, we may not be able to acquire additional uranium projects in a competitive bidding process involving such companies. Additionally, these larger companies have greater resources to continue with their operations during periods of depressed market conditions.

The titanium industry is concentrated and highly competitive, and we may not be able to compete effectively with our competitors that have greater financial resources or those that are vertically integrated, which could have a material adverse effect on our business, results of operations and financial condition.

The global titanium market is highly competitive, with the top six producers accounting for approximately 60% of the world's production capacity. Competition is based on a number of factors, such as price, product quality and service. Competition is based on a number of factors, such as price, product quality and service. Among our competitors are companies that are vertically-integrated (those that have their own raw material resources). Changes in the competitive landscape could make it difficult for us to retain our competitive position in various products and markets throughout the world. Our competitors with their own raw material resources may have a competitive advantage during periods of higher raw material prices. In addition, some of the companies with whom we compete may be able to produce products more economically than we can. Furthermore, some of our competitors have greater financial resources, which may enable them to invest significant capital into their businesses, including expenditures for research and development.

We hold mineral rights in foreign jurisdictions which could be subject to additional risks due to political, taxation, economic and cultural factors.

We hold certain mineral rights located in the Republic of Paraguay through Piedra Rica Mining S.A., Transandes Paraguay S.A., Trier S.A. and Metalicos Y No Metalicos S.R.L., which are incorporated in Paraguay. Operations in foreign jurisdictions outside of the United States and Canada, especially in developing countries, may be subject to additional risks as they may have different political, regulatory, taxation, economic and cultural environments that may adversely affect the value or continued viability of our rights. These additional risks include, but are not limited to: (i) changes in governments or senior government officials; (ii) changes to existing laws or policies on foreign investments, environmental protection, mining and ownership of mineral interests; (iii) renegotiation, cancellation, expropriation and nationalization of existing permits or contracts; (iv) foreign currency controls and fluctuations; and (v) civil disturbances, terrorism and war.

In the event of a dispute arising at our foreign operations in Paraguay, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of the courts in the United States or Canada. We may also be hindered or prevented from enforcing our rights with respect to a government entity or instrumentality because of the doctrine of sovereign immunity. Any adverse or arbitrary decision of a foreign court may have a material and adverse impact on our business, prospects, financial condition and results of operations.

The title to our mineral property interests may be challenged.

Although we have taken reasonable measures to ensure proper title to our interests in mineral properties and other assets, there is no guarantee that the title to any of such interests will not be challenged. No assurance can be given that we will be able to secure the grant or the renewal of existing mineral rights and tenures on terms satisfactory to us, or that governments in the jurisdictions in which we operate will not revoke or significantly alter such rights or tenures or that such rights or tenures will not be challenged or impugned by third parties, including local governments, aboriginal peoples or other claimants. The Company has had communications and filings with the MOPC, the mining regulator in Paraguay, whereby the MOPC is taking the position that certain concessions forming part of the Company’s Yuty and Alto Parana projects are not eligible for extension as to exploration or continuation to exploitation in their current stages. While the Company remains fully committed to its development path forward in Paraguay, it caused its legal counsel to file an appeal in Paraguay to reverse the MOPC’s position in order to protect the Company’s continuing rights in those concessions. Our mineral properties may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. A successful challenge to the precise area and location of our claims could result in us being unable to operate on our properties as permitted or being unable to enforce our rights with respect to our properties.

Due to the nature of our business, we may be subject to legal proceedings which may divert management’s time and attention from our business and result in substantial damage awards.

Due to the nature of our business, we may be subject to numerous regulatory investigations, securities claims, civil claims, lawsuits and other proceedings in the ordinary course of our business including those described under Item 1, Legal Proceedings. The outcome of these lawsuits is uncertain and subject to inherent uncertainties, and the actual costs to be incurred will depend upon many unknown factors. We may be forced to expend significant resources in the defense of these suits, and we may not prevail. Defending against these and other lawsuits in the future may not only require us to incur significant legal fees and expenses, but may become time-consuming for us and detract from our ability to fully focus our internal resources on our business activities. The results of any legal proceeding cannot be predicted with certainty due to the uncertainty inherent in litigation, the difficulty of predicting decisions of regulators, judges and juries and the possibility that decisions may be reversed on appeal. There can be no assurances that these matters will not have a material adverse effect on our business, financial position or operating results.

We depend on certain key personnel, and our success will depend on our continued ability to retain and attract such qualified personnel.

Our success is dependent on the efforts, abilities and continued service of certain senior officers and key employees and consultants. A number of our key employees and consultants have significant experience in the uranium industry. A loss of service from any one of these individuals may adversely affect our operations, and we may have difficulty or may not be able to locate and hire a suitable replacement.

Certain directors and officers may be subject to conflicts of interest.

The majority of our directors and officers are involved in other business ventures including similar capacities with other private or publicly-traded companies. Such individuals may have significant responsibilities to these other business ventures, including consulting relationships, which may require significant amounts of their available time. Conflicts of interest may include decisions on how much time to devote to our business affairs and what business opportunities should be presented to us. Our Code of Business Conduct for Directors, Officers and Employees provides for guidance on conflicts of interest.

The laws of the State of Nevada and our Articles of Incorporation may protect our directors and officers from certain types of lawsuits.

The laws of the State of Nevada provide that our directors and officers will not be liable to our Company or to our stockholders for monetary damages for all but certain types of conduct as directors and officers. Our Bylaws provide for broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. These indemnification provisions may require us to use our limited assets to defend our directors and officers against claims, and may have the effect of preventing stockholders from recovering damages against our directors and officers caused by their negligence, poor judgment or other circumstances.

Several of our directors and officers are residents outside of the United States, and it may be difficult for stockholders to enforce within the United States any judgments obtained against such directors or officers.

Several of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of such persons’ assets are located outside of the United States. As a result, it may be difficult for investors to effect service of process on such directors and officers, or enforce within the United States any judgments obtained against such directors and officers, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof. Consequently, stockholders may be effectively prevented from pursuing remedies against such directors and officers under United States federal securities laws. In addition, stockholders may not be able to commence an action in a Canadian court predicated upon the civil liability provisions under United States federal securities laws. The foregoing risks also apply to those experts identified in this document that are not residents of the United States.

Disclosure controls and procedures and internal control over financial reporting, no matter how well designed and operated, are designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness.

Management’s evaluation on the effectiveness of disclosure controls and procedures is designed to ensure that information required for disclosure in our public filings is recorded, processed, summarized and reported on a timely basis to our senior management, as appropriate, to allow timely decisions regarding required disclosure.

Management’s report on internal control over financial reporting is designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use and transactions are properly recorded and reported. However, any system of controls, no matter how well designed and operated, is based in part upon certain assumptions designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness. Any failure to maintain effective disclosure controls and procedures in the future may result in our inability to continue meeting our reporting obligations in a timely manner, qualified audit opinions or restatements of our financial reports, any one of which may affect the market price for our common stock and our ability to access the capital markets.

Risks Related to Our Common Stock

Historically, the market price of our common stock has been and may continue to fluctuate significantly.

On September 28, 2007, our common stock commenced trading on the NYSE American (formerly known as the American Stock Exchange, the NYSE Amex Equities Exchange and the NYSE MKT) and prior to that, traded on the OTC Bulletin Board.

The global markets have experienced significant and increased volatility in the past and have been impacted by the effects of mass sub-prime mortgage defaults and liquidity problems of the asset-backed commercial paper market, resulting in a number of large financial institutions requiring government bailouts or filing for bankruptcy. The effects of these past events and any similar events in the future may continue to or further affect the global markets, which may directly affect the market price of our common stock and our accessibility for additional financing. Although this volatility may be unrelated to specific company performance, it can have an adverse effect on the market price of our shares which, historically, has fluctuated significantly and may continue to do so in the future.

In addition to the volatility associated with general economic trends and market conditions, the market price of our common stock could decline significantly due to the impact of any one or more events, including, but not limited to, the following: (i) volatility in the uranium market; (ii) occurrence of a major nuclear incident such as the events in Fukushima in March 2011; (iii) changes in the outlook for the nuclear power and uranium industries; (iv) failure to meet market expectations on our exploration, pre-extraction or extraction activities, including abandonment of key uranium projects; (v) sales of a large number of our shares held by certain stockholders including institutions and insiders; (vi) downward revisions to previous estimates on us by analysts; (vii) removal from market indices; (viii) legal claims brought forth against us; and (ix) introduction of technological innovations by competitors or in competing technologies.

A prolonged decline in the market price of our common stock could affect our ability to obtain additional financing which would adversely affect our operations.

Historically, we have relied on equity financing and more recently, on debt financing, as primary sources of financing. A prolonged decline in the market price of our common stock or a reduction in our accessibility to the global markets may result in our inability to secure additional financing which would have an adverse effect on our operations.

Additional issuances of our common stock may result in significant dilution to our existing shareholders and reduce the market value of their investment.

We are authorized to issue 750,000,000 shares of common stock of which 183,673,815 shares were issued and outstanding as of January 31, 2020. Future issuances for financings, mergers and acquisitions, exercise of stock options and share purchase warrants and for other reasons may result in significant dilution to and be issued at prices substantially below the price paid for our shares held by our existing stockholders. Significant dilution would reduce the proportionate ownership and voting power held by our existing stockholders and may result in a decrease in the market price of our shares.

We filed the 2017 Shelf, which was declared effective on March 10, 2017, providing for the public offer and sale of certain securities of our Company from time to time, at our discretion, up to an aggregate offering amount of $100 million.

As at April 7, 2019, a total of $68.4 million of the 2017 Shelf was utilized through the registration of our shares of common stock underlying outstanding common share purchase warrants from previous registered offerings with a remaining available balance of $31.6 million under the 2017 Shelf. On April 8, 2019 we filed an additional Form S-3 shelf registration statement pursuant to Rule 462(b) of the Securities Act, which became effective upon filing on April 8, 2019, providing for the public offer and sale of certain additional securities of our Company from time to time, at our discretion, under the 2017 Shelf, of up to an aggregate offering amount of an additional $6.3 million; then bringing the balance remaining under the 2017 Shelf to $37.9 million to be sold under the ATM.

We are subject to the Continued Listing Criteria of the NYSE American and our failure to satisfy these criteria may result in delisting of our common stock.

Our common stock is currently listed on the NYSE American. In order to maintain this listing, we must maintain certain share prices, financial and share distribution targets, including maintaining a minimum amount of shareholders’ equity and a minimum number of public shareholders. In addition to these objective standards, the NYSE American may delist the securities of any issuer: (i) if, in its opinion, the issuer’s financial condition and/or operating results appear unsatisfactory; (ii) if it appears that the extent of public distribution or the aggregate market value of the security has become so reduced as to make continued listing on the NYSE American inadvisable; (iii) if the issuer sells or disposes of principal operating assets or ceases to be an operating company; (iv) if an issuer fails to comply with the NYSE American’s listing requirements; (v) if an issuer’s common stock sells at what the NYSE American considers a “low selling price” and the issuer fails to correct this via a reverse split of shares after notification by the NYSE American; or (vi) if any other event occurs or any condition exists which makes continued listing on the NYSE American, in its opinion, inadvisable.

If the NYSE American delists our common stock, investors may face material adverse consequences, including, but not limited to, a lack of trading market for our securities, reduced liquidity, decreased analyst coverage of our securities and an inability for us to obtain additional financing to fund our operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

During our fiscal quarter ended January 31, 2020, we issued the following securities that were not registered under the Securities Act:

●

on December 3, 2019, we issued an aggregate of 13,201 shares of common stock to a consultant in consideration for services under a consulting agreement at a deemed issuance price of $0.9090 per share. We relied on exemptions from registration under the Securities Act provided by Regulation S and/or Section 4(a)(2) with respect to the issuance of these shares.

●

on December 3, 2019, we issued an aggregate of 1,743,462 shares of common stock to our six Lenders at a deemed issuance price of $0.803 per share pursuant to the terms of the Third Amended and Restated Credit Agreement. We relied on exemptions from registration under the Securities Act provided by Regulation S and/or Section 4(a)(2) for the issuance of 1,220,423 shares to four of the Lenders and on exemptions from registration under the Securities Act provided by Rule 506 of Regulation D and/or Section 4(a)(2) of the Securities Act for the issuance of 523,039 shares to two of the Lenders; and

●

on December 23, 2019, we issued an aggregate of 300,000 shares of common stock at a deemed issuance price of $0.84 per share as well as 300,000 common stock purchase warrants (each, a “Warrant”) to a consultant in consideration for services under a consulting agreement. 150,000 of the Warrants entitle the holder thereof to purchase 150,000 shares of common stock (each, a “Warrant Share”) at an exercise price of $1.25 per Warrant Share and 150,000 of the Warrants entitle the holder thereof to purchase 150,000 Warrant Shares at an exercise price of $1.50 per Warrant Share, all Warrants having an expiry date of December 23, 2020. We relied on exemptions from registration under the Securities Act provided by Rule 506(b) of Regulation D and/or Section 4(a)(2) of the Securities Act with respect to the issuance of these securities.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States, and that is subject to regulation by the Federal Mine Safety and Health Administration under the Mine Safety and Health Act of 1977 (“Mine Safety Act”), are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the quarter ended January 31, 2020, the Company’s Palangana Mine was not subject to regulation by the Mine Safety Act.

Item 5. Other Information

None.

Item 6. Exhibits

The following exhibits are included with this Quarterly Report:

Exhibit	Description of Exhibit

31.1	Certification of Chief Executive Officer pursuant to the Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

31.2	Certification of Chief Financial Officer pursuant to the Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

32.1	Certifications pursuant to the Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.1NS 101.SCH 101.CAL 101.DEF 101.LAB 101.PRE	XBRL Instance Document XBRL Taxonomy Extension Schema Document XBRL Taxonomy Extension Calculation Linkbase Document XBRL Taxonomy Extension Definitions Linkbase Document XBRL Taxonomy Extension Label Linkbase Document XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	URANIUM ENERGY CORP.

	By:	/s/ Amir Adnani
		Amir Adnani President, Chief Executive Officer (Principal Executive Officer) and Director Date: March 10, 2020

	By:	/s/ Pat Obara
		Pat Obara Chief Financial Officer (Principal Financial Officer) Date: March 10, 2020

URANIUM ENERGY CORP - FORM 10-Q - March 10, 2020

Attached files

URANIUM ENERGY CORP Reports