UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
x |
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the quarterly period ended June 30, 2013
Or
o |
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission file number 001-33404
URANIUM RESOURCES, INC.
(Exact Name of Issuer as Specified in Its Charter)
DELAWARE |
|
75-2212772 |
(State of Incorporation) |
|
(I.R.S. Employer Identification |
|
|
No.) |
6950 S. Potomac Street, Suite 300, Centennial, Colorado 80112
(Address of Principal Executive Offices, Including Zip Code)
(303) 531-0470
(Issuers Telephone Number, Including Area Code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o |
|
Accelerated filer o |
|
|
|
Non-accelerated filer o |
|
Smaller reporting company x |
(Do not check if a smaller reporting company) |
|
|
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12-b2 of the Exchange Act). Yes o No x
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.
Title of Each Class of Common Stock |
|
Number of Shares Outstanding |
Common Stock, $0.001 par value |
|
20,020,058 as of August 13, 2013 |
URANIUM RESOURCES, INC.
2012 SECOND QUARTERLY REPORT ON FORM 10-Q
PART I FINANCIAL INFORMATION
URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
(Unaudited)
|
|
June 30,
|
|
December 31,
|
|
||
Current assets: |
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
5,325,813 |
|
$ |
4,664,596 |
|
Receivables, net |
|
5,925 |
|
276,801 |
|
||
Prepaid and other current assets |
|
395,654 |
|
431,427 |
|
||
Total current assets |
|
5,727,392 |
|
5,372,824 |
|
||
Property, plant and equipment, at cost: |
|
|
|
|
|
||
Uranium properties |
|
108,232,478 |
|
107,672,404 |
|
||
Other property, plant and equipment |
|
1,333,861 |
|
1,360,598 |
|
||
Less-accumulated depreciation, depletion and impairment |
|
(65,466,430 |
) |
(65,318,921 |
) |
||
Net property, plant and equipment |
|
44,099,909 |
|
43,714,081 |
|
||
Long-term investment: |
|
|
|
|
|
||
Certificates of deposit, restricted |
|
4,010,292 |
|
9,491,865 |
|
||
|
|
$ |
53,837,593 |
|
$ |
58,578,770 |
|
The accompanying notes to financial statements are an integral part of these condensed consolidated statements.
URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
LIABILITIES AND SHAREHOLDERS EQUITY
(Unaudited)
|
|
June 30,
|
|
December 31,
|
|
||
Current liabilities: |
|
|
|
|
|
||
Accounts payable |
|
$ |
764,448 |
|
$ |
1,331,888 |
|
Note payable |
|
|
|
5,000,000 |
|
||
Current portion of asset retirement obligations |
|
887,257 |
|
1,160,378 |
|
||
Royalties and commissions payable |
|
665,745 |
|
665,745 |
|
||
Accrued interest and other accrued liabilities |
|
748,787 |
|
859,981 |
|
||
Current portion of capital leases |
|
40,431 |
|
112,140 |
|
||
Total current liabilities |
|
3,106,668 |
|
9,130,132 |
|
||
Asset retirement obligations |
|
3,455,798 |
|
3,337,679 |
|
||
Other long-term deferred credits |
|
500,000 |
|
500,000 |
|
||
Long-term capital leases, less current portion |
|
8,847 |
|
17,582 |
|
||
Long-term debt |
|
450,000 |
|
450,000 |
|
||
Total liabilities |
|
7,521,313 |
|
13,435,393 |
|
||
Commitments and contingencies (Note 9) |
|
|
|
|
|
||
Shareholders equity: |
|
|
|
|
|
||
Common stock, $.001 par value, shares authorized: 200,000,000; shares issued and outstanding (net of treasury shares): 201320,020,258; 201216,150,163 |
|
20,024 |
|
16,154 |
|
||
Paid-in capital |
|
216,504,760 |
|
207,338,549 |
|
||
Accumulated deficit |
|
(170,199,086 |
) |
(162,201,908 |
) |
||
Less: Treasury stock (3,813 shares), at cost |
|
(9,418 |
) |
(9,418 |
) |
||
Total shareholders equity |
|
46,316,280 |
|
45,143,377 |
|
||
|
|
$ |
53,837,593 |
|
$ |
58,578,770 |
|
The accompanying notes to financial statements are an integral part of these condensed consolidated statements.
URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||
|
|
2013 |
|
2012 |
|
2013 |
|
2012 |
|
||||
Revenues: |
|
|
|
|
|
|
|
|
|
||||
Uranium sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Total revenue |
|
|
|
|
|
|
|
|
|
||||
Costs and expenses: |
|
|
|
|
|
|
|
|
|
||||
Cost of uranium sales: |
|
|
|
|
|
|
|
|
|
||||
Operating expenses |
|
630,907 |
|
923,429 |
|
1,318,124 |
|
1,143,837 |
|
||||
Accretion/amortization of asset retirement obligations |
|
97,435 |
|
23,624 |
|
194,870 |
|
46,743 |
|
||||
Depreciation and depletion |
|
73,919 |
|
110,996 |
|
149,818 |
|
227,318 |
|
||||
Impairment of uranium properties |
|
400,226 |
|
482,849 |
|
679,655 |
|
751,772 |
|
||||
Exploration expenses and land maintenance costs |
|
652,455 |
|
30,744 |
|
751,360 |
|
57,459 |
|
||||
Total cost of uranium sales |
|
1,854,942 |
|
1,571,642 |
|
3,093,827 |
|
2,227,129 |
|
||||
Loss from operations before corporate expenses |
|
(1,854,942 |
) |
(1,571,642 |
) |
(3,093,827 |
) |
(2,227,129 |
) |
||||
Corporate expenses: |
|
|
|
|
|
|
|
|
|
||||
General and administrative |
|
1,939,882 |
|
2,183,553 |
|
4,575,118 |
|
5,196,689 |
|
||||
Depreciation |
|
37,163 |
|
31,956 |
|
83,142 |
|
63,840 |
|
||||
Total corporate expenses |
|
1,977,045 |
|
2,215,509 |
|
4,658,260 |
|
5,260,529 |
|
||||
Loss from operations |
|
(3,831,987 |
) |
(3,787,151 |
) |
(7,752,087 |
) |
(7,487,658 |
) |
||||
Other income (expense): |
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
(9,908 |
) |
(3,121 |
) |
(249,626 |
) |
(6,668 |
) |
||||
Interest and other income (expense), net |
|
(4,691 |
) |
129,593 |
|
4,535 |
|
227,177 |
|
||||
Net loss |
|
$ |
(3,846,586 |
) |
$ |
(3,660,679 |
) |
$ |
(7,997,178 |
) |
$ |
(7,267,149 |
) |
Basic and diluted net loss per common share |
|
$ |
(0.19 |
) |
$ |
(0.30 |
) |
$ |
(0.43 |
) |
$ |
(0.70 |
) |
Average weighted shares outstanding |
|
19,879,847 |
|
10,626,011 |
|
18,580,078 |
|
10,215,350 |
|
The accompanying notes to financial statements are an integral part of these condensed consolidated statements.
URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
Six Months Ended
|
|
||||
|
|
2013 |
|
2012 |
|
||
Operating activities: |
|
|
|
|
|
||
Net loss |
|
$ |
(7,997,178 |
) |
$ |
(7,267,149 |
) |
Reconciliation of net loss to cash used in operations |
|
|
|
|
|
||
Accretion/amortization of asset retirement obligations |
|
194,870 |
|
46,743 |
|
||
Depreciation and depletion |
|
232,960 |
|
291,158 |
|
||
Impairment of uranium properties |
|
679,655 |
|
751,772 |
|
||
Decrease in restoration and reclamation accrual |
|
(933,897 |
) |
(879,269 |
) |
||
Stock compensation expense |
|
183,316 |
|
311,797 |
|
||
Other non-cash items, net |
|
73,795 |
|
609 |
|
||
Effect of changes in operating working capital items |
|
|
|
|
|
||
(Increase) decrease in receivables |
|
270,876 |
|
(83,354 |
) |
||
Decrease in prepaid and other current assets |
|
35,773 |
|
46,242 |
|
||
Increase (decrease) in payables, accrued liabilities and deferred credits |
|
(291,301 |
) |
1,672,138 |
|
||
Net cash used in operating activities |
|
(7,551,131 |
) |
(5,109,313 |
) |
||
Cash flows from investing activities: |
|
|
|
|
|
||
(Increase) decrease in certificates of deposit, restricted |
|
5,481,573 |
|
(46,715 |
) |
||
Increase in notes receivable |
|
|
|
(3,156,765 |
) |
||
Additions to uranium properties |
|
(788,213 |
) |
(3,155,448 |
) |
||
Net cash provided by (used in) investing activities |
|
4,693,360 |
|
(6,358,928 |
) |
||
Cash flows from financing activities: |
|
|
|
|
|
||
Payments on borrowings |
|
(80,444 |
) |
(31,702 |
) |
||
Issuance of common stock, net |
|
3,599,432 |
|
11,434,055 |
|
||
Net cash provided by financing activities |
|
3,518,988 |
|
11,402,353 |
|
||
Net increase (decrease) in cash and cash equivalents |
|
661,217 |
|
(65,888 |
) |
||
Cash and cash equivalents, beginning of period |
|
4,664,596 |
|
2,890,263 |
|
||
Cash and cash equivalents, end of period |
|
$ |
5,325,813 |
|
$ |
2,824,375 |
|
Non-cash transactions: |
|
|
|
|
|
||
Issuance of common stock for short-term loan principal and interest payments |
|
$ |
5,095,833 |
|
|
|
|
Issuance of common stock for services |
|
$ |
291,500 |
|
|
|
|
Issuance of restricted stock to employees and directors |
|
$ |
247 |
|
$ |
341 |
|
Capital lease obligations |
|
$ |
|
|
$ |
24,931 |
|
The accompanying notes to financial statements are an integral part of these condensed consolidated statements.
Uranium Resources, Inc.
Notes to Condensed Consolidated Financial Statements June 30, 2013 (Unaudited)
1. DESCRIPTION OF BUSINESS
Uranium Resources, Inc. (URI) is a uranium exploration, development and production company. We were organized in 1977 to acquire and develop uranium mines in South Texas using the in-situ recovery mining process (ISR). URI has historically produced uranium by ISR methods in the State of Texas where the Company currently has ISR mining projects, including two licensed processing facilities. We also have mineral holdings in New Mexico and a NRC license to produce up to 3 million pounds per annum of uranium on certain of its New Mexico projects. The Company acquired these properties over the past 20 years along with an extensive information database of historic mining logs and analysis. None of URIs properties are currently in production.
2. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The accompanying statements should be read in conjunction with the audited financial statements included in the Companys 2012 Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2013 are not necessarily indicative of the results that may be expected for any other period including the full year ending December 31, 2013.
3. LIQUIDITY
The Company had negative cash flow from operations of $7.6 million for the six months ended June 30, 2013. Our cash position was $5.3 million at June 30, 2013 and $4.25 million at July 31, 2013. The Company is not currently commercially producing uranium and, as such, does not anticipate generating any significant sales revenues in 2013.
In March 2013, the Company completed a Shareholder Rights Offering (Rights Offering) whereby the Company received $3.6 million in cash, net of expenses and $5.0 million was used to repay the short term financing from Resource Capital Fund V L.P. (RCF).
In February 2013, the Company secured a new source to satisfy its financial surety obligations for the Texas regulatory agencies. Previously, the Company had met its financial surety obligations through a combination of bank issued letters of credit (the L/Cs) and bonds issued for the benefit of the Company. These financial surety arrangements required the Company to fully collateralize the face amount of the L/Cs and the bonds with short term investment vehicles. This requirement resulted in the Company posting $9.3 million in cash that was restricted for the purpose of collateralizing these obligations. The Companys new financial surety arrangements are provided by Lexon Insurance Company (Lexon) in the form of bonds issued for the benefit of the Company. The amount of the bonds written by Lexon total approximately $9.0 million and the collateral requirements of these bonds requires the Company to maintain 40% of the value of the bonds in the form of restricted cash. This change in collateral requirement occurred in April 2013 and reduced the amount of restricted cash required by the Company to $3.6 million and resulted in a corresponding increase in cash to the Company of $5.4 million.
In the fourth quarter of 2011, the Company entered into an At-The-Market Sales Agreement with BTIG, LLC, allowing it to sell from time to time, its common shares having an aggregate offering price of up to $15.0 million, through an at-the-market equity offering program (ATM Sales Agreement). The Company did not make any sales under the ATM Sales Agreement in the second quarter of 2013 and has a total of $9.0 million available for future sales under the ATM Sales Agreement.
The Company expects that its existing cash and funding available under the ATM Sales Agreement will provide it the necessary liquidity moving forward for 2013. Additional funding available under the ATM Sales Agreement is subject to market conditions. In the event funds are not available, we may be required to change our planned business strategies.
4. PROPERTY, PLANT AND EQUIPMENT
|
|
Property, Plant and
|
|
||||
|
|
6/30/2013 |
|
12/31/2012 |
|
||
Uranium plant |
|
$ |
10,859,000 |
|
$ |
10,913,000 |
|
Permits and licenses |
|
4,199,000 |
|
3,902,000 |
|
||
Mineral rights |
|
4,250,000 |
|
3,873,000 |
|
||
Value beyond proven and probable reserves (VBPP) |
|
20,274,000 |
|
20,274,000 |
|
||
Evaluation and delineation |
|
2,460,000 |
|
2,460,000 |
|
||
Vehicles/depreciable equipment |
|
1,273,000 |
|
1,435,000 |
|
||
Well field development |
|
153,000 |
|
153,000 |
|
||
Other uranium properties |
|
232,000 |
|
246,000 |
|
||
Other property, plant and equipment |
|
400,000 |
|
458,000 |
|
||
Total |
|
$ |
44,100,000 |
|
$ |
43,714,000 |
|
Impairment of Uranium Properties
At June 30, 2013 and 2012, the carrying value of the project assets at each of our South Texas production locations exceeded their fair value as a result of a decline in the market price of uranium and an increase in the estimated costs for each of our South Texas projects.
Such determination resulted in an impairment provision of approximately $680,000 and $752,000 for the first six months of 2013 and 2012, respectively. The impairment provision for the first six months of 2013 and 2012 respectively, was $394,000 and $321,000 related to Kingsville Dome, $276,000 and $401,000 related to Vasquez, and $10,000 and $30,000 related to for Rosita.
The net carrying values of the Kingsville Dome, Rosita and Vasquez projects are approximately $5.4 million, $4.9 million and $405,000 at June 30, 2013.
5. SHAREHOLDERS EQUITY
Reverse Stock Split
Immediately following the close of trading on January 22, 2013, the Company completed a 1 for 10 reverse stock split for its common stock. With the reverse stock split, every ten shares of the Companys issued and outstanding common stock were combined into one issued and outstanding share of common stock. The reverse stock split had no effect on the par value of the shares or the authorized number of shares of the Company. The reverse split reduced the number of URIs outstanding common stock from approximately 161.1 million shares to approximately 16.1 million shares. All share data herein has been retroactively adjusted for the reverse stock split as of December 31, 2012.
The following table details the changes in shareholders equity for the six months ended June 30, 2013:
|
|
Common Stock |
|
Paid-In |
|
Accumulated |
|
Treasury |
|
||||||
|
|
Shares |
|
Amount |
|
Capital |
|
Deficit |
|
Stock |
|
||||
Balances, December 31, 2012 |
|
16,150,163 |
|
$ |
16,154 |
|
$ |
207,338,549 |
|
$ |
(162,201,908 |
) |
$ |
(9,418 |
) |
Net loss |
|
|
|
|
|
|
|
(7,997,178 |
) |
|
|
||||
Stock compensation expense |
|
|
|
|
|
183,316 |
|
|
|
|
|
||||
Common stock issued payment of loan principal and interest |
|
1,992,127 |
|
1,992 |
|
5,093,841 |
|
|
|
|
|
||||
Common stock issued shareholder rights offering |
|
1,547,843 |
|
1,548 |
|
3,597,884 |
|
|
|
|
|
||||
Common stock issued for services |
|
83,200 |
|
83 |
|
291,417 |
|
|
|
|
|
||||
Restricted stock issuance |
|
246,925 |
|
247 |
|
(247 |
) |
|
|
|
|
||||
Balances, June 30, 2013 |
|
20,020,258 |
|
$ |
20,024 |
|
$ |
216,504,760 |
|
$ |
(170,199,086 |
) |
$ |
(9,418 |
) |
See Note 6 Stock Based Compensation for further discussion of stock compensation expense and restricted stock issuance.
Equity InfusionShareholder Rights Offering
In March 2013, the Company completed the Rights Offering, whereby each URI shareholder and warrant holder received one non-transferrable subscription right for each share of common stock owned or subject to a warrant as of 5:00pm ET on January 28, 2013. Every subscription right entitled the holder to purchase 0.3119 of a share of common stock of URI at a price of $2.55 per whole share.
Under the Rights Offering, the Company raised $3.6 million in cash, net of expenses and $5.0 million was used to repay the short term financing from RCF, whereby RCF was issued 1.96 million shares of the Companys common stock. Also in connection with the RCF loan facility, the Company issued 31,343 shares of common stock in 2013 to pay fourth quarter 2012 and first quarter 2013 interest accrued on the loan of $16,667 and $79,167, respectively.
6. STOCK BASED COMPENSATION
Our stock based compensation programs consist of stock option and restricted stock grants made to employees and directors.
2013 Omnibus Incentive Plan
In June 2013, the Companys stockholders and Board approved the 2013 Omnibus Incentive Plan (2013 OIP) that governs all future awards of stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock, dividend equivalent rights, performance shares and other performance-based awards, other equity-based awards, and cash bonus awards. A total of approximately 1 million shares are available to be issued under the 2013 OIP.
Stock Compensation Expense
Stock compensation expense for the six months ended June 30, 2013 and 2012 was $183,000 and $312,000, respectively. Stock compensation expense is recorded as a component of general and administrative expenses for each period. The Company did not recognize a tax benefit from the stock compensation expense because the Company considers it is more likely than not that the related deferred tax assets, which have been reduced by a full valuation allowance, will not be realized.
On January 16, 2013, the Company granted 5,000 stock options to a newly appointed non-employee director of the Company to purchase shares of the Companys common stock.
On March 12, 2013, the Company granted 25,000 restricted shares of the Companys common stock to the new President and Chief Executive Officer, subject to service and performance vesting criteria over a three-year period. The weighted average fair value for this issuance was $2.73. The Company recognized stock compensation expense of $7,000.
On March 12, 2013, the Company also granted to the new President and Chief Executive Officer 55,000 stock options to purchase common stock of the Company, subject to service and performance vesting criteria over a three-year period. The weighted average fair value for this issuance was $1.98. The Company recognized stock compensation expense of $11,000.
On March 12, 2013, the Company granted 25,000 restricted shares of the Companys common stock to a former executive of the Company in connection with a separation agreement signed with the executive. The Company recognized stock compensation expense for the restricted share grants of $43,000 in the first half of 2013 in connection with this issuance. In addition, the Company extended the exercise period for certain previously issued stock options for this former executive and recognized stock compensation expense for this modification of $134,000 in the first half of 2013.
On June 4, 2013, the Compensation Committee approved a grant of 100,000 shares of restricted stock units under the 2013 OIP to the President and Chief Executive Officer, subject to specific vesting criteria over a three-year period. The weighted average fair value for this issuance was $2.83. The Company recognized stock compensation expense of $6,000 in connection with this issuance.
On June 4, 2013, the Board also approved a grant of a total of 100,000 restricted stock units under the 2013 OIP to the Companys non-employee Directors, subject to specific vesting criteria over a three-year period. The weighted average fair value for this issuance was $2.83. The Company recognized stock compensation expense of $7,000 in connection with this issuance.
The fair value of stock options and restricted shares granted to employees and directors was estimated on the dates of the grants using the Black-Scholes option pricing model with the following assumptions used for the grants made during the period:
Risk free rate |
|
2.16% - 1.40% |
Expected life |
|
5.7 7.8 years |
Expected volatility |
|
84% - 89% |
Expected dividend yield |
|
0 .0% |
The total estimated unrecognized compensation cost from the unvested stock options and restricted grants at June 30, 2013 was approximately $904,000, which is expected to be recognized over the weighted average vesting period of the individual grants which range from 1-3 years.
Stock Options for the Six Months Ended June 30, 2013
The following table summarizes stock options outstanding and changes during the six month period ended June 30, 2013:
|
|
Outstanding Options |
|
||||||||
|
|
Number of
|
|
Weighted
|
|
Weighted
|
|
Aggregate
|
|
||
Options outstanding at January 1, 2013 |
|
317,270 |
|
$ |
24.62 |
|
|
|
|
|
|
Granted |
|
60,000 |
|
2.85 |
|
|
|
|
|
||
Exercised |
|
|
|
|
|
|
|
|
|
||
Canceled or forfeited |
|
72,791 |
|
25.90 |
|
|
|
|
|
||
Options outstanding at June 30, 2013 |
|
304,479 |
|
$ |
20.02 |
|
4.31 |
|
$ |
|
|
Options exercisable at June 30, 2013 |
|
226,980 |
|
$ |
25.57 |
|
2.51 |
|
$ |
|
|
Shares available for grant under the Companys stock option plans as of June 30, 2013 were 987,914.
Stock options outstanding and currently exercisable at June 30, 2013 are as follows:
|
|
Options Outstanding |
|
Options Exercisable |
|
||||||||
Stock Option Plan |
|
Number of
|
|
Weighted
|
|
Weighted
|
|
Number of
|
|
Weighted
|
|
||
|
|
|
|
(in years) |
|
|
|
|
|
|
|
||
1995 Stock Incentive Plan |
|
145,906 |
|
1.1 |
|
$ |
13.46 |
|
145,906 |
|
$ |
13.46 |
|
2004 Stock Incentive Plan |
|
85,241 |
|
8.0 |
|
13.92 |
|
29,408 |
|
34.74 |
|
||
2004 Directors Plan |
|
73,332 |
|
6.4 |
|
40.19 |
|
51,666 |
|
54.57 |
|
||
|
|
304,479 |
|
4.3 |
|
$ |
20.02 |
|
226,980 |
|
$ |
25.57 |
|
7 . ASSET RETIREMENT OBLIGATIONS
The following table shows the change in the balance of the restoration and reclamation liability during the six months ended June 30, 2013:
Reserve for future restoration and reclamation costs, beginning of year |
|
$ |
4,498,057 |
|
Additions and changes in cash flow estimates |
|
584,025 |
|
|
Costs incurred |
|
(933,897 |
) |
|
Accretion expense |
|
194,870 |
|
|
Reserve for future restoration and reclamation costs, end of period |
|
$ |
4,343,055 |
|
8. EARNINGS PER SHARE
The basic earnings per share calculation includes no dilution and is computed by dividing income or loss attributed to common stockholders by the weighted-average number of common shares outstanding for the period. The diluted earnings per share reflects the potential dilution that could occur if stock options and warrants were exercised or converted into common stock. Potentially dilutive shares of 451,764 were excluded from the calculation of earnings per share because they were anti-dilutive due to our net loss position for the six months ended June 30, 2013.
9. COMMITMENTS AND CONTINGENCIES
In July 2013, the Company amended its uranium supply contract with Itochu Corporation (Itochu) to include a new sales pricing structure, new delivery dates and quantity levels. Pursuant to the amended agreement, Itochu would purchase one-half of all production from the Companys Vasquez, Rosita or Kingsville properties up to three million pounds of U3O8. Any new production outside of those areas is not subject to the agreement. The purchase price will be based on published market prices at the time of delivery subject to a five percent discount when the market price is $56.50 per pound of U3O8 or less, or seven percent when greater than $56.50 per pound.
The Companys mining operations are subject to federal and state regulations for the protection of the environment, including water quality. These laws are constantly changing and generally becoming more restrictive. The ongoing costs of complying with such regulations have not been significant to the Companys annual operating costs. Future mine closure and reclamation costs are provided for as each pound of uranium is produced on a unit-of-production basis. The Company reviews its reclamation obligations each year and determines the appropriate unit charge. The Company also evaluates the status of current environmental laws and their potential impact on their accrual for costs. The Company believes its operations are in compliance with current environmental regulations.
The Company is from time to time involved in various legal proceedings of a character normally incident to its business. Management believes it has meritorious defenses in all such proceedings and is not aware of any material adverse effect on the Companys financial condition or results of operations from such proceedings.
Registration Statement
In connection with our May 2008 private placement and the March 2012 investment agreement with RCF, the Company executed a registration rights agreement pursuant to which the shares issued in the private placement and under the investment agreement were registered. The registration rights agreement provides for penalties in the event the registration statement fails to remain effective. At June 30, 2013, the Companys registration statements were and remain effective.
Compensation Agreements
The Company has entered into Compensation Agreements with the certain of the Executive Officers of the Company, that provide that, in the event of a change in control, such officers will have certain rights and benefits for a period of twenty-four months following such change in control. The Compensation Agreements provide that the executives base salary payments shall be made on a monthly basis for the duration of the term and any incentive payments shall be paid annually until the obligation to make such payments expires.
In March 2013, the Company entered into a Compensation Agreement with the Companys new President and Chief Executive Officer with a one-year term. In the event his employment is terminated following a change in control, he would be entitled to two years base salary payable in a lump sum within 30 days after his termination date. In the event the Company terminates the Compensation Agreement during its term, other than for cause or elects not to renew the Compensation Agreement at the conclusion of its term, he would be entitled to one years base salary payable in a lump sum within 30 days after his termination date.
In June 2013, the Company entered into a Compensation Agreement with the Companys new Vice President Finance and Chief Financial Officer with a one-year term. In the event his employment is terminated following a change in control, he would be entitled to one years base salary payable in a lump sum within 30 days after his termination date. In the event the Company terminates the Compensation Agreement during its term, other than for cause or elects not to renew the Compensation Agreement at the conclusion of its terms, he would be entitled to six months base salary payable in a lump sum within 30 days after his termination date.
10. SUBSEQUENT EVENT
On August 2, 2013, Thomas H. Ehrlich, the Companys former chief financial officer, filed a complaint against the Company in the District Court of Denton County, Texas, Cause No. 2013-61011-393. The complaint alleges that the Company breached a compensation agreement between the Company and Mr. Ehrlich that provided for certain payments to Mr. Ehrlich upon certain change in control events. While the Company is still evaluating the complaint and cannot estimate the timing or estimated amount, if any, associated with the outcome, the Company does not believe it will have a material adverse impact on the Companys financial position, results of operations or liquidity. The Company intends to vigorously defend any assertions related to the above lawsuit.
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward Looking Statements
The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and any financial data incorporated herein by reference to the Companys reports filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934. Forward-looking statements convey our current expectations or forecasts of future events. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
This Item 2 contains forward looking statements. These statements include, without limitation, statements relating to liquidity, financing of operations, continued volatility of uranium prices and other matters. The words believes, expects, projects, targets, estimates or similar expressions identify forward-looking statements. We do not undertake to update, revise or correct any of the forward-looking information. Readers are cautioned that such forward-looking statements should be read in conjunction with our disclosures and the risks set forth herein and in the Companys 2012 Annual Report on Form 10-K under the caption Risk Factors.
General
The Companys vision is to be a leading U.S. uranium developer and producer. Our strategy is to create wealth for shareholders by advancing our projects in a way which both conserves cash and best positions us to return to production when uranium markets improve. In Texas, our focus is to add quality reserves within an economic distance of each licensed ISR processing facility through exploration activities and/or through value accretive acquisitions. In New Mexico, we will continue to progress the Churchrock Section 8 ISR project and also assess the potential of our significant resource base for the development of larger scale projects on a standalone basis or with partners.
We have 206,600 acres of mineral holdings with 144.8 million pounds U3O8 of in-place mineralized uranium material in New Mexico and a NRC license to produce up to 3 million pounds per annum of uranium on certain of our New Mexico projects. The Company acquired these properties over the past 20 years along with an extensive information database of historic mining logs and analysis. None of URIs properties are currently in production.
Financial Condition and Results of Operations
Comparison of Three and Six Months Ended June 30, 2013 and 2012
Uranium Sales
During the first half of 2013 and 2012, we had no uranium sales.
Cost of Uranium Sales
The costs incurred in the first half of 2013 and 2012 for operations and depreciation/depletion resulted from stand-by, maintenance and monitoring activities at our Rosita, Kingsville Dome, and Vasquez projects. Our total cost of uranium sales is comprised of production costs, including operating expenses, depreciation and depletion expenses, and also includes amortization of our restoration and reclamation cost estimates, exploration costs incurred during the period and impairment provisions for uranium properties.
The following table details our cost of uranium sales breakdown for the three and six months ended June 30, 2013 and 2012:
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||
|
|
2013 |
|
2012 |
|
2013 |
|
2012 |
|
||||
Total pounds sold |
|
|
|
|
|
|
|
|
|
||||
Total operating expenses |
|
$ |
631,000 |
|
$ |
923,000 |
|
$ |
1,318,000 |
|
$ |
1,144,000 |
|
Depreciation and depletion |
|
74,000 |
|
111,000 |
|
150,000 |
|
227,000 |
|
||||
Direct cost of sales |
|
$ |
705,000 |
|
$ |
1,034,000 |
|
$ |
1,468,000 |
|
$ |
1,371,000 |
|
Operating Expenses
During the first half of 2013, we incurred total operating expenses of $1,318,000, of which $311,000 was connected with our South Texas projects and $1,007,000 with the Kingsville Dome pond recovery project. During the first half of 2012, we incurred operating expenses of $288,000 related to our South Texas projects and $856,000 in connection with the Kingsville Dome pond recovery project.
During the three-months ended June 30, 2013, we incurred total operating expenses of $631,000, of which $179,000 was connected with our South Texas projects and $452,000 with the Kingsville Dome pond recovery project. During the three-months ended June 30, 2012, we incurred operating expenses of $142,000 related to our South Texas projects and $781,000 in connection with the Kingsville Dome pond recovery project.
Depreciation and Depletion
During the first half of 2013 and 2012, we incurred depreciation and depletion expense related to our South Texas projects of $150,000 and $227,000, respectively. During the three-months ended June 30, 2013, we incurred depreciation and depletion expense related to our South Texas projects of $74,000, compared to $111,000 for the corresponding period in 2012. All such costs were from stand-by and/or care and maintenance activities.
Impairment of Uranium Properties
At June 30, 2013 and 2012, the carrying value of the project assets at each of our South Texas production locations exceeded their fair value as a result of an increase in the estimated costs for each of our South Texas projects. The increase in cost is due to a change in the estimate of future restoration and remediation costs for these projects, such change then capitalized in accordance with our accounting policy. Such determination resulted in an impairment provision of approximately $680,000 and $752,000 for the first six months of 2013 and 2012, respectively. The impairment provision for the first six months of 2013 and 2012, respectively, were $394,000 and $321,000 related to Kingsville Dome, $276,000 and $401,000 related to Vasquez and $10,000 and $30,000 for Rosita.
The impairment provision for the three-months ended June 30, 2013 was $400,000, compared to $483,000 for the corresponding period in 2012, respectively. The impairment provision, respectively, was $297,000 and $153,000 for Kingsville Dome, $98,000 and $314,000 for Vasquez, and $5,000 and $16,000 for Rosita.
Accretion and Amortization of Future Restoration Costs
During the first half of 2013 and 2012, the accretion and amortization of future restoration costs were $195,000 and $47,000, respectively. This increase of $148,000 was primarily due to a modification in the interest rate used in the calculation.
During the three-months ended June 30, 2013, the accretion and amortization of future restoration costs was $97,000, compared to $24,000 for the corresponding period in 2012. This increase of $73,000 was primarily due to a modification in the interest rate used in the calculation.
General and Administrative Charges
We incurred general and administrative charges, including corporate depreciation, of $4.7 million and $5.3 million in the first six months of 2013 and 2012, respectively.
During the three-months ended June 30, 2013, general and administrative charges, including corporate depreciation totaled $1,977,000, compared to $2,216,000 for the corresponding period in 2012.
Significant expenditures for general and administrative expenses for the three and six months ended June 30, 2013 and 2012 were:
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||
|
|
2013 |
|
2012 |
|
2013 |
|
2012 |
|
||||
Stock compensation expense (benefit) |
|
$ |
(62,000 |
) |
$ |
119,000 |
|
$ |
183,000 |
|
$ |
312,000 |
|
Salaries and payroll burden |
|
751,000 |
|
716,000 |
|
1,600,000 |
|
1,890,000 |
|
||||
Legal, accounting, public company expenses |
|
630,000 |
|
855,000 |
|
1,345,000 |
|
2,059,000 |
|
||||
Insurance and bank fees |
|
216,000 |
|
153,000 |
|
460,000 |
|
305,000 |
|
||||
Consulting and professional services |
|
123,000 |
|
110,000 |
|
454,000 |
|
236,000 |
|
||||
Office, travel and other expenses |
|
282,000 |
|
231,000 |
|
533,000 |
|
395,000 |
|
||||
Total |
|
$ |
1,940,000 |
|
$ |
2,184,000 |
|
$ |
4,575,000 |
|
$ |
5,197,000 |
|
During the first half of 2013 and 2012, non-cash stock compensation expense was $183,000 and $312,000, respectively. This decrease of $129,000 resulted primarily from the adjustment for stock option forfeitures. During the three-months ended June 30, 2013, non-cash stock compensation benefit was $62,000, as compared to non-cash stock compensation expense of $119,000 for the corresponding period in 2012.
Salaries and payroll burden decreased $290,000 in the first six months of 2013, as compared to the same period in 2012, due to a reduction in headcount and the consolidation of operations. During the three-months ended June 30, 2013, salaries and payroll burden totaled $751,000, compared to $716,000 for the corresponding period in 2012.
The Companys legal, accounting and public company expenses decreased by $714,000 in the first six months of 2013 as compared to the same period in 2012. The decrease resulted from a reduction in legal activities in 2013 related to merger activity for the Neutron Energy, Inc., litigation defense costs incurred in connection with the Kleberg County matter in the 2012 period, and substantial changes in the management and control of legal activities and charges for those legal activities performed by outside counsel for the Company. These reductions were offset by higher costs in 2013 incurred in connection with legal fees from the transactions conducted in connection with the Shareholder Rights Offering and for fees paid to the interim President/CEO during the quarter. During the three-months ended June 30, 2013, legal, accounting and public company expenses totaled $630,000, compared to $855,000 for the corresponding period in 2012.
Consulting and professional service expenses increased by $218,000 for the first six months ended June 30, 2013, compared with 2012. This increase was the result of work performed in connection with the Companys New Mexico UIC permit renewal, Churchrock Section 8 access and Churchrock Section 17 characterization activities. During the three-months ended June 30, 2013, consulting and professional service expenses totaled $123,000, compared to $110,000 for the corresponding period in 2012.
Insurance and bank fees increased in 2013, primarily because of an increase in general liability and umbrella insurance premiums due to the addition of the Neutron properties and payroll. Fees for bond premiums also increased in 2013, with the initiation of the bond program with Lexon Insurance in the first quarter of 2013, and the addition of Neutron properties. During the three-months ended June 30, 2013, insurance and bank fees totaled $216,000, compared to $153,000 for the corresponding period in 2012.
The increase in office, travel and other expenses from $395,000 for the first six month of 2012 to $533,000 in the 2013 period was due to added office rent and IT services costs incurred during the first three and six months of the year. During the three-months ended June 30, 2013, office, travel and other expenses totaled $282,000, compared to $231,000 for the corresponding period in 2012.
Net Losses
For the six months ended June 30, 2013 and 2012, we had net losses of $8 million and $7.3 million, respectively.
For the three months ended June 30, 2013 and 2012, we had net losses of $3.9 million and $3.7 million, respectively.
Cash Flow
At June 30, 2013, we had a cash balance of approximately $5.3 million, compared with $2.8 million at the same date in 2012.
In the first six months of 2013, we had cash used in operations of $7.6 million. Cash provided by investing activities was $4.7 million, the result of $5.5 million of restricted cash returned to the Company, less $788,000 in property additions. During the period, we had net cash generated from financing activities of $3.6 million, resulting from the $3.6 million in cash raised through the sale of the Companys common stock in connection with the Shareholder Rights Offering that was completed in March 2013.
In the first six months of 2012, we had cash used in operations of $5.1 million. We used $6.4 million in investing activities during the first half of 2012 which was primarily from the funding of Neutron administrative and development activities in connection with the merger agreement provisions of $3.2 million and additions made to our South Texas and New Mexico property, plant and equipment of $3.2 million during the period. These expenditures were primarily for land and mineral lease payments and plant construction during the period.
LiquidityCash Sources and Uses for 2013
As of June 30, 2013, the Company had $5.3 million in cash. As of July 31, 2013, the Company had a cash balance of $4.25 million. The Company is not currently conducting uranium production activities. The Company is not projecting significant sales revenue and related cash inflows for 2013. During 2013, the Company is expected to complete the process of refurbishing its Kingsville Dome holding ponds and expects to generate a certain amount of uranium bearing product as a by-product of this pond project activity. The Company is currently assessing the pond project uranium bearing product to determine the quantity and quality of yellowcake that may be available for sale this year.
Under the Rights Offering, the Company raised $3.6 million in cash, net of expenses and $5.0 million was used to repay the short-term financing from RCF.
In February 2013, the Company secured $9 million in new surety bonds for the benefit of the Texas Commission on Environmental Quality for remediation and reclamation activities at the Companys South Texas projects. The collateral requirements for these new bonds require the Company to post 40% of the face amount of the bonds ($3.6 million) in cash collateral as a condition of their terms. These bonds replaced the existing $9.0 million of fully collateralized financial surety instruments that previously provided the financial surety requirements for the projects. As a result of the lower cash collateral requirement, $5.4 million of the Companys restricted cash was released back to the Company in April 2013.
On October 28, 2011, the Company entered into an At-The-Market Sales Agreement with BTIG, LLC, allowing it to sell from time to time, its common shares having an aggregate offering price of up to $15.0 million, through an at-the-market equity offering program (ATM Sales Agreement). The Company did not utilize the ATM Sales Agreement in the first half of 2013. The Company has a total of $9.0 million available for future sales under the ATM Sales Agreement.
The Company expects that its existing cash balance and funding available under the ATM Sales Agreement will provide it the necessary liquidity for 2013. Additional funding under the ATM Sales Agreement is subject to market conditions. In the event funds are not available, we may be required to change our planned business strategies.
Off Balance Sheet Arrangements
In February 2013, the Company secured $9 million in new surety bonds from Lexon Insurance Company (Lexon) for the benefit of the Texas Commission on Environmental Quality for remediation and reclamation activities at the Companys South Texas projects. The collateral requirements for these new bonds require the Company to post 40% of the face amount of the bonds ($3.6 million) in cash collateral as a condition of their terms. These bonds replaced the existing $9.0 million of fully cash collateralized financial surety instruments that previously provided the financial surety requirements for the projects. In the event that Lexon is required to perform under its bonds or the bonds are called by the state agencies, the Company would be obligated to pay costs incurred by Lexon that exceeded the collateral amounts.
Critical Accounting Policies
Our significant accounting policies are described in Note 2 to the consolidated financial statements included in the Companys 2012 Annual Report on Form 10-K. We believe our most critical accounting policies involve those requiring the use of significant estimates and assumptions in determining values or projecting future costs. Such estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.
Specifically regarding our uranium properties, significant estimates were utilized in determining the carrying value of these assets. These assets have been recorded at their estimated net realizable value for impairment purposes, which is less than our cost. The actual value realized from these assets may vary significantly from these estimates based upon market conditions, financing availability and other factors. Future market conditions in particular can be difficult to predict and measure because of the impact of events that affect public acceptance of nuclear energy, the limited size of the market for the use of uranium, changes in the prices of alternative energy sources, development of new low-cost alternative energy sources and other factors.
Regarding our reserve for future restoration and reclamation costs, significant estimates were utilized in determining the future costs to complete the groundwater restoration and surface reclamation at our mine sites. Estimating future costs can be difficult and unpredictable because they are based principally on current legal and regulatory requirements and mine closure plans that may change materially. The laws and regulations governing mine closure and remediation in a particular jurisdiction are subject to review at any time and may be amended to impose additional requirements and conditions which may cause our provisions for environmental liabilities to be underestimated and could materially affect our financial position or results of operations. Estimates of future restoration and reclamation costs are also subject to operational risks such as acceptance of treatment techniques or other operational changes.
Also, the calculation of reserves, other mineralized material and grading are estimates and depend upon geological interpretation and statistical inferences or assumptions drawn from drilling and sampling analysis, which may prove to be unpredictable. There is a degree of uncertainty attributable to the calculation of reserves, mineralized material and corresponding grades. Until reserves and other mineralized materials are actually mined and processed, the quantity of ore and grades must be considered as an estimate only. In addition, the quantity of reserves and other mineralized materials and ore may vary depending on the price of uranium. Any material change in the quantity of reserves, other mineralized materials, mineralization or grade may affect the economic viability of our properties.
The accounts of the Company are maintained in United States dollars. All dollar amounts in the financial statements are stated in United States dollars except where indicated.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There has been no material change to the information reported under Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk contained in our Annual Report on Form 10-K for the year ended December 31, 2012.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its filings with the Securities and Exchange Commission (SEC) are recorded, processed, summarized and reported within the time period specified in the SECs rules and forms, and that such information is accumulated and communicated to management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management has recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating its controls and procedures.
During the fiscal period covered by this report, the Companys management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Companys disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of June 30, 2013.
Changes in Internal Controls
During the three months ended June 30, 2013 no material changes have been made in our internal control over financial reporting that may have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Litigation
On August 2, 2013, Thomas H. Ehrlich, the Companys former chief financial officer, filed a complaint against the Company in the District Court of Denton County, Texas, Cause No. 2013-61011-393. The complaint alleges that the Company breached a compensation agreement between the Company and Mr. Ehrlich that provided for certain payments to Mr. Ehrlich upon certain change in control events. While the Company is still evaluating the complaint and cannot estimate the timing or estimated amount, if any, associated with the outcome, the Company does not believe it will have a material adverse impact on the Companys financial position, results of operations or liquidity. The Company intends to vigorously defend any assertions related to the above lawsuit.
There have been no material changes from those risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2012.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
During the quarter ended June 30, 2013, no unregistered securities were sold.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
None.
See the Index to Exhibits on Page E-1 for a listing of the exhibits that are filed as part of this Quarterly Report.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
URANIUM RESOURCES, INC. |
|
|
|
|
Dated: August 13, 2013 |
By: |
/s/ Christopher Jones |
|
|
Christopher Jones |
|
|
President and Chief Executive Officer |
|
|
|
Dated: August 13, 2013 |
By: |
/s/ Jeffrey L. Vigil |
|
|
Jeffrey L. Vigil |
|
|
Vice President - Finance and Chief Financial Officer |
|
|
(Principal Financial and Accounting Officer) |
Exhibit
|
|
Description |
10.1 |
|
Uranium Resources, Inc. 2013 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 to the Companys Current Report on Form 8-K filed on June 7, 2013). |
10.2 |
|
Form of Restricted Stock Agreement (incorporated by reference to Exhibit 10.2 to the Companys Current Report on Form 8-K filed on June 7, 2013). |
10.3 |
|
Form of Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.3 to the Companys Current Report on Form 8-K filed on June 7, 2013). |
10.4 |
|
Form of Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.4 to the Companys Current Report on Form 8-K filed on June 7, 2013). |
10.5 |
|
Employment Agreement, effective June 14, 2013, between the Company and Jeffrey L. Vigil. |
10.6 |
|
Separation Agreement and General Release dated June 6, 2013, between the Company and Mathew F. Lueras. |
31.1 |
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2 |
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1 |
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2 |
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101 |
|
The following financial information from the quarterly report on Form 10-Q of Uranium Resources, Inc. for the quarter ended June 30, 2013, formatted in XBRL (extensible Business Reporting Language): (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statements of Cash Flows and (v) Notes to the Condensed Consolidated Financial Statements. |
Exhibit 10.5
URANIUM RESOURCES, INC.
and
JEFFREY L. VIGIL
EMPLOYMENT AGREEMENT
This Employment Agreement (Agreement) is made as of the 11 th day of June 2013 (the Signature Date) by and between Uranium Resources, Inc. (URI), a Delaware corporation (the Company), and Jeffrey L. Vigil (Executive), and is effective as of the 14 th day of June 2013 (the Effective Date).
1. Employment
During the Employment Period (as defined in Section 4), the Company will employ Executive, and Executive will serve as Vice President and Chief Financial Officer (CFO) reporting directly to and with duties to be assigned by the President and Chief Executive Officer (CEO).
2. Duties and Responsibilities of Executive on the Effective Date
(a) During the Employment Period (as defined in Section 4), Executive will devote substantially all of his professional time and efforts to the business of the Company, will act in the best interests of the Company and will perform with due care his duties and responsibilities. Executives duties will include those normally incidental to the position of Vice President and CFO as well as such additional duties consistent with Executives position as may be assigned to him by the President and CEO.
(b) Executive agrees to cooperate fully with the President and CEO and not engage directly or indirectly in any activity that materially interferes with the performance of Executives duties. During the Employment Period, Executive will not hold outside employment, join, be a member or serve on any corporate, civic, or charitable boards or committees, or perform substantial personal services for parties unrelated to the Company without the advance written approval of both the President and CEO and the Nominating & Governance Committee of the URI Board of Directors (Board).
(c) Executive represents and covenants to the Company that he is not subject to, or a party to, any employment agreement, non-competition covenant, non-solicitation agreement, nondisclosure agreement, or any other agreement, covenant, understanding, or restriction that would prohibit Executive from executing this Agreement and fully performing his duties and responsibilities under this Agreement.
(d) Executive acknowledges and agrees that Executive owes the Company a duty of loyalty and that any obligations described in this Agreement are in addition to, and not in lieu of, any obligations Executive owes the Company as a matter of law.
3. Compensation
(a) Base Salary Commencing on the Effective Date and during the Employment Period, the Company will pay to Executive an annual base salary of $200,000 (the Base Salary), payable on a not less than a bi-weekly basis, in conformity with the Companys customary payroll practices for executive salaries. Executives Base Salary shall be reviewed for adjustment by the Compensation Committee of the Board (Compensation Committee)
annually commencing at year-end 2013. For all purposes of this Agreement, Executives Base Salary will include any portion thereof which Executive elects to defer under any nonqualified plan or arrangement.
(b) Annual Performance Bonus Executive will be eligible for an annual cash discretionary performance bonus with respect to each calendar year during the Employment Period (the Annual Performance Bonus), which will consist of a payment targeted at 30% of Base Salary during 2013, pro-rated for the year, and targeted at a percent of Base Salary to be set by the Compensation Committee for calendar years following 2013. The amount, if any, of the Annual Performance Bonus will be determined by the Compensation Committee, acting in its sole and complete discretion, based on performance objectives established for the Executive. By the end of June 2013 the performance objectives for 2013 must be developed by Executive and presented to the President and CEO. Following 2013, the Annual Performance Bonus will be targeted at 30% of then current Base Salary or such higher percentage as the Compensation Committee determines. Also following 2013, the President and CEO will, on an annual basis (at or near the beginning of each calendar year in the Employment Period) establish performance objectives for Executive for that calendar year, and will communicate such objectives to Executive. The President and CEO will consult with Executive regarding annual performance objectives but the President and CEO will establish such objectives in his sole discretion. Annual Performance Bonus determinations are typically made by the Compensation Committee within 90 calendar days after the end of each calendar year, and Annual Performance Bonus amounts shall be paid as soon as administratively practicable thereafter, but in all events in the calendar year following the calendar year for which the Annual Performance Bonus was earned.
(c) Equity Incentive Compensation Within 60 days from the Effective Date the Compensation Committee will grant Executive 80,000 shares of restricted stock units; one-third of such shares shall vest in equal one-third installments on the first, second and third anniversary dates of the Effective Date; the remaining two-thirds of such shares shall vest over three years subject to achievement of annual performance objectives as addressed in Section 3(b) above. In addition to this grant, Executive will be eligible to participate in the Companys equity incentive compensation programs of the Company in accordance with the policies applicable to other executive positions of the Company, upon such terms as the administrators of the programs determine.
(d) Stock Ownership Target Within 5 years from the Effective Date, Executive is expected to own shares of Company Common Stock equal in value to three (3) times his original Base Salary of $200,000 per year. The following will count towards meeting the required ownership level: shares owned directly or beneficially; restricted stock or stock units held under any Company restricted stock or similar program (whether vested or unvested); shares owned jointly with or in trust for immediate family members residing in the same household; shares subject to any vested but unexercised stock options; and any other vested securities the form of which is counted towards ownership for the other Companys executives. The value of the stock held by Executive on any date of determination will be equal to the greater of: (i) Executives
acquisition cost; and (ii) the average market price per share of the Common Stock on the last trading day of each of the four completed quarters prior to the determination.
(f) Withholding Executives Base Salary, Annual Performance Bonus, and other compensation payments hereunder will be subject to such payroll and other taxes, withholdings, assessments and deductions as may be required by applicable law.
4. Term of Employment
(a) The Term of this Agreement will be for the period beginning on the Effective Date and ending at midnight (Mountain Time) on the first anniversary of the Effective Date. The Term will be extended automatically for successive one-year periods unless either party gives the other written notice of its intent to terminate the Agreement not less than 90 days prior to the end of the then-current Term. The initial Term and any extensions are hereinafter referred to as the Term. The date on which this Agreement is terminated at the end of the Term or in accordance with Section 6 will be referred to herein as the the Termination Date, and the parties shall ensure that Executive incurs a separation from service, as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the Code), on the Termination Date.
(b) The period commencing on the Effective Date and ending at the close of business on the Termination Date will constitute the Employment Period.
(c) Notwithstanding any other provision of this Agreement, this Agreement may be terminated at any time during the Employment Period in accordance with Section 6.
5. Benefits
Subject to the terms and conditions of this Agreement, Executive will be entitled to the following benefits during the Employment Period:
(a) Reimbursement of Business Expenses The Company agrees to promptly reimburse Executive for reasonable business-related expenses incurred in the performance of Executives duties under this Agreement in accordance with Company policies.
(b) Benefit Plans and Programs To the extent permitted by applicable law, Executive (and where applicable, his spouse and other plan-eligible dependents) will be eligible to participate in all benefit plans and programs, including improvements or modifications of the same, then being actively maintained by the Company for the benefit of its executive employees (or for an employee population which includes its executive employees), subject in any event to the eligibility requirements and other terms and conditions of those plans and programs, including, without limitation, 401(k) plan, medical and dental insurance, life insurance and disability insurance. The Company will not, however, by reason of this Section 5(b), have any obligation to institute, maintain, or refrain from changing, amending, or discontinuing any such benefit plan or program.
(c) Base of Operations Executives base of operations will be at Companys offices located in Denver, Colorado. Executive may be required from time to time to work outside of his base of operations.
(d) Vacation Executive shall be entitled to 4 weeks of paid vacation annually, which shall be prorated to eleven (11) days for 2013 based upon the Effective Date of this Agreement.
6. Termination of Agreement
(a) Automatic Termination in the Event of Death This Agreement will automatically terminate in the event of Executives death.
(b) Companys Right to Terminate At any time during the Employment Period, the Company will have the right to terminate this Agreement for any of the following reasons:
(1) Upon Executives Disability (as defined below);
(2) For Cause (as defined in Section 7); or
(3) For any other reason whatsoever, in the sole and complete discretion of the Company.
(c) Executives Right to Terminate At any time during the Employment Period, Executive will have the right to terminate this Agreement for:
(1) Good Reason (as defined in Section 7); or
(2) For any other reason whatsoever, in the sole and complete discretion of Executive. An election by Executive not to renew this Agreement at the end of the Term will constitute a termination of this Agreement by Executive under this subsection.
(d) Disability For purposes of this Agreement, Disability means that Executive has sustained sickness or injury that renders Executive incapable of performing substantially all of the duties and responsibilities required of Executive hereunder for a period of 90 consecutive calendar days or a total of 120 calendar days during any 12-month period. The existence of a Disability will be determined in the sole and complete discretion of the Board.
(e) Notices Any termination of this Agreement by the Company under Section 6(b) or by Executive under Section 6(c) will be communicated by a Notice of Termination to the other party. A Notice of Termination means a written notice that: (i) indicates the specific termination provision in this Agreement relied upon; and (ii) if the termination is by the Company for Cause or by Executive for Good Reason, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executives employment under the provision so indicated. The Notice of Termination must specify the Termination Date. The Termination Date may be as early as 14 calendar days after the Notice of Termination is given but no later than 60 calendar days after the Notice of Termination is given, unless otherwise agreed to by the parties in writing.
7. Severance Payments
(a) Termination by the Company If the Company terminates this Agreement during the Employment Period pursuant to Sections 6(b)(1) or 6(b)(3), then the Company will pay
Executive severance in the amount of six (6) months of Base Salary in a lump sum within 30 days after the Termination Date subject to all applicable withholding.
(b) Termination by Executive for Good Reason If Executive terminates this Agreement during the Employment Period pursuant to Section 6(c)(1), then the Company will pay Executive severance in the amount of six (6) months of Base Salary in a lump sum within 30 days after the Termination Date subject to all applicable withholding.
(c) Termination by Executive for Good Reason after a Change in Control If a Change in Control (as defined below) occurs and Executive is terminated pursuant to Section 6(b)(3) or terminates this Agreement during the Employment Period pursuant to Section 6(c)(1) within 90 days after such occurrence, then the Company will pay Executive severance in the amount of one (1) year of Base Salary, in a lump sum within 30 days after the Termination Date subject to all applicable withholding.
(d) Termination upon Failure to Renew by the Company In the event that this Agreement terminates at the end of the Term and is not renewed as a result of a decision by the Company not to renew this Agreement, prior to a decision by Executive not to renew this Agreement, the Company will pay Executive severance in the amount of six (6) months of Base Salary in a lump sum within 30 days after the Termination Date subject to all applicable withholding.
(e) Additional Benefits If the Company is required to pay Executive severance pursuant to Section 7(a), 7(b), 7(c), or 7(d), then:
(1) Such severance will be paid in addition to any other payments the Company makes to Executive (including, without limitation, salary, bonuses, equity plans, incentive compensation plans, fringe benefits, and expense reimbursements) in discharge of the Companys obligations to Executive under this Agreement with respect to periods ending coincident with or prior to the Termination Date.
(2) Payments under Sections 7(a), 7(b), 7(c), or 7(d) will be in lieu of any severance benefits otherwise due to Executive under any severance pay plan or program maintained by the Company that covers its employees and/or its executives except to the extent otherwise expressly provided in such severance pay plan or program.
(3) The expiration date of any options held by Executive will be extended to a date that is 90 days after the Termination Date.
In addition to the foregoing benefits but only in the event the Company is required to pay Executive severance by the express terms of Section 7(c), to the extent Executive has not previously vested in such rights (whether in accordance with Section 8 hereof of otherwise), Executive will become fully vested in all of the rights and interests held by Executive under the Companys stock and other equity plans as of the Termination Date, including without limitation any stock options, restricted stock, restricted stock units, performance units, and/or performance shares.
(f) Cause For the purposes of this Agreement, Cause means the occurrence or existence, prior to occurrence of circumstances constituting Good Reason, of any of the following events during the Employment Period:
(1) Executives gross negligence or material mismanagement in performing, or material failure or inability (excluding as a result of death or Disability) to perform, Executives duties and responsibilities as described herein or as lawfully directed by the President and CEO;
(2) Executives willful misconduct or material dishonesty against the Company or any of its affiliates (including theft, misappropriation, embezzlement, forgery, fraud, falsification of records, or misrepresentation) or any act that results in material injury to the reputation, business or business relationships of the Company or any of its affiliates;
(3) Executives material breach of: (i) this Agreement; (ii) any fiduciary duty owed by Executive to the Company or its affiliates; or (iii) any written workplace policies applicable to Executive (including the Companys code of conduct and policy on workplace harassment) whether adopted on or after the date of this Agreement, provided that the President and CEO gives Executive written notice of such breach within 90 calendar days from the first date that the President and CEO is aware, or reasonably should be aware, of such breach and such breach is not remedied within 30 days of Executives receipt of such notice.
(4) Executives having been convicted of, or having entered a plea bargain, a plea of nolo contendere or settlement admitting guilt for, any felony, any crime of moral turpitude, or any other crime that could reasonably be expected to have a material adverse impact on the Companys or any of its affiliates reputations; or
(5) Executives having committed any material violation of any federal law regulating securities (without having relied on the advice of the Companys attorney) or having been the subject of any final order, judicial or administrative, obtained or issued by the Securities and Exchange Commission, for any securities violation involving fraud, including, for example, any such order consented to by Executive in which findings of facts or any legal conclusions establishing liability are neither admitted nor denied.
(g) Good Reason For the purposes of this Agreement, Good Reason means the occurrence, prior to the occurrence of circumstances constituting Cause, of any of the following events during the Employment Period without Executives consent:
(1) Any material breach by the Company of this Agreement, provided that Executive gives the Board written notice of such breach within 90 days from the first date that he is aware, or reasonably should be aware, of such breach and such breach is not remedied within 30 days of the Boards receipt of such written notice;
(2) A material reduction in Executives authority or job duties, responsibilities and requirements that is inconsistent with Executives position as Vice
President and CFO of the Company and Executives prior authority, duties, responsibilities and requirements;
(3) A material reduction in the Executives Base Salary or Annual Performance Bonus opportunity unless a proportionate reduction is made to the Base Salary or business opportunity of all of the Companys executives; or
(4) Any requirement that Executive move his primary residence from the Denver, Colorado metropolitan area.
(h) Exclusive Payments Except as provided above, no severance or other payment in the way of severance will be made to Executive upon termination of this Agreement.
8. Change of Control
(a) If a Change of Control occurs during the Employment Period, Executive will thereupon become 100% vested in all of the rights and interests then held by Executive under the Companys stock and other equity plans (to the extent not already vested), including without limitation any stock options, restricted stock, restricted stock units, performance units, and/or performance shares.
(b) Change of Control For the purposes of this Agreement, Change of Control means that, after the Effective Date, the following two events have occurred: (1) the Executive (i) is requested to resign by the Company, (ii) is terminated by the Company, (iii) is demoted or his responsibilities are materially changed by the Company, or (iv) events or circumstances have occurred that constitute Good Reason; and (2) one of the following has occurred: (i) any person or group of affiliated or associated persons (other than Resource Capital Fund V, L.P. (RCF) or RMB Australia Holdings, Ltd. (RMB) or the affiliates, subsidiaries, parents or other related entities of RCF or RMB) acquires more than 50% of the voting power of the Company; (ii) the consummation of a sale of all or substantially all of the assets of the Company; (iii) the dissolution of the Company; (iv) a majority of the members of the Board are replaced during any 12-month period; or (v) the consummation of any merger, consolidation, or reorganization involving the Company in which, immediately after giving effect to such merger, consolidation or reorganization, less than 50.1% of the total voting power of outstanding stock of the surviving or resulting entity is then beneficially owned (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended) in the aggregate by the stockholders of the Company immediately prior to such merger, consolidation or reorganization.
9. Parachute Payment
Notwithstanding any other provision of this Agreement, in the event that it shall be determined that the aggregate payments or distributions by the Company to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (the Payments), constitute excess parachute payments (as such term is defined under Section 280G of the Code or any successor provision, and the regulations promulgated thereunder (collectively, Section 280G)) that would be subject to the excise tax imposed by Section 4999 of the Code or any successor provision (collectively, Section 4999) or any interest or penalties with respect to such excise tax (the total excise tax, together with any interest and penalties, are hereinafter collectively referred to as the Excise Tax)), then the
Payments shall be either (a) delivered in full, or (b) delivered to such lesser extent that would result in no portion of the Payments being subject to the Excise Tax, whichever of the foregoing amounts, taking into account the applicable federal, state or local income and employment taxes and the Excise Tax, results in the receipt by Executive, on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be subject to the Excise Tax. In the event that the Payments are to be reduced pursuant to this Section 9, such Payments shall be reduced such that the reduction of compensation to be provided to Executive as a result of this Section 9 is minimized. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A and where two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis (but not below zero). All calculations required pursuant to this Section 9 shall be performed in good faith by nationally recognized registered public accountants or tax counsel selected by the Company, and the Company shall bear all fees and costs incurred in performing such calculations.
10. Conflicts of Interest
Executive agrees that he will promptly disclose to the President and CEO any conflict of interest involving Executive upon Executive becoming aware of such conflict. Executives ownership of an interest not in excess of five percent in a business organization that competes with the Company will not be deemed to constitute a conflict of interest.
11. Confidentiality
The Company agrees to provide Executive valuable Confidential Information of the Company and of third parties who have supplied such information to the Company. In consideration of such Confidential Information and other valuable consideration provided hereunder, Executive agrees to comply with this Section 11.
(a) Confidential Information For the purposes of this Agreement, Confidential Information means, without limitation and regardless of whether such information or materials are expressly identified as confidential or proprietary: (i) any and all material non-public, confidential or proprietary information or work product of the Company or its affiliates; (ii) any non-public information that gives the Company or its affiliates a material competitive business advantage or the opportunity of obtaining such advantage; (iii) any material non-public information the disclosure or improper use of which is reasonably expected to be materially detrimental to material interests of the Company or its affiliates; (iv) any material trade secrets of the Company or its affiliates; and (v) any other material non-public information of or regarding the Company or any of its affiliates, or its or their past, present or future, direct or indirect, potential or actual officers, directors, employees, owners, or business partners, including but not limited to information regarding any of their material businesses, operations, assets, liabilities, properties, systems, methods, models, processes, results, performance, investments, investors, financial affairs, future plans, business prospects, acquisition or investment opportunities, strategies, business partners, business relationships, contracts, contractual relationships, organizational or personnel matters, policies or procedures, management or compensation matters, compliance or regulatory matters, as well as any technical, seismic, industry, market or other data, studies or research, or any forecasts, projections, valuations, derivations or other analyses, performed, generated, collected, gathered, synthesized, purchased or owned by, or
otherwise in the possession of, the Company or its affiliates or which Executive has learned of through his employment with the Company. Confidential Information also includes any non-public, confidential or proprietary information about or belonging to any third party that the Company or its affiliates have agreed in writing to keep confidential. Notwithstanding the foregoing, Confidential Information does not include any information which is or becomes generally known by the public other than as a result of Executives actions or inactions.
(b) Protection Executive promises, except in the regular course of the Companys business or as required by law: (i) to keep Confidential Information, and all documentation, materials and information relating thereto, strictly confidential; (ii) not to use the Confidential Information for any purpose other than as required in connection with fulfilling his duties as Vice President and CFO for the benefit of the Company; and (iii) to return to the Company all documents and electronically stored information containing Confidential Information in Executives possession upon separation from the Company for any reason.
(c) Disclosure Required By Law If Executive is legally required to disclose any Confidential Information, Executive will promptly notify the Company in writing of such request or requirement so that the Company may seek an appropriate protective order or other relief. Executive agrees to cooperate with and not to oppose any effort by the Company to resist or narrow such request or to seek a protective order or other appropriate remedy. In any case, Executive will: (i) disclose only that portion of the Confidential Information that, according to the advice of Executives counsel, is required to be disclosed (and Executives disclosure of Confidential Information to Executives counsel in connection with obtaining such advice will not be a violation of this Agreement); (ii) use reasonable efforts to obtain assurances that such Confidential Information will be treated confidentially; and (iii) promptly notify the Company in writing of the items of Confidential Information so disclosed.
(d) Third-Party Confidentiality Agreements To the extent that the Company possesses any Confidential Information which is subject to any confidentiality agreements with, or obligations to, third parties, Executive will comply with all such agreements or obligations in full.
(e) Survival The covenants made by Executive in this Section 11, will survive termination of this Agreement for two (2) years following the Termination Date.
12. Non-Competition & Non-Solicitation
Executive acknowledges that the Company has invested substantial time, money and resources in the development and retention of its Confidential Information, customers, accounts and business partners, and further acknowledges that during the course of Executives employment with the Company Executive has had and will have access to the Companys Confidential Information and will be introduced to existing and prospective customers, suppliers, accounts and business partners of the Company. Executive acknowledges and agrees that any and all goodwill associated with any existing or prospective customer, supplier, account or business partner belongs exclusively to the Company, including, but not limited to, any goodwill created as a result of direct or indirect contacts or relationships between Executive and any existing or prospective customers, suppliers accounts or business partners. Additionally, the parties acknowledge and agree that Executive possesses skills that are special, unique or
extraordinary and that the value of the Company depends upon his use of such skills on its behalf.
In recognition of this, Executive agrees that:
(a) During the Term of this Agreement, and for a period of six (6) months thereafter, Executive may not, without the prior written consent of the Company, (whether as an employee, agent, servant, owner, partner, consultant, independent contractor, representative, stockholder, or in any other capacity whatsoever) perform any work in the United States related in any way to uranium mining on behalf of any entity or person other than the Company (including Executive).
(b) During the Term of this Agreement, and for a period of six (6) months thereafter, Executive may not entice, solicit or encourage any Company employee to leave the employ of the Company or any independent contractor to sever its engagement with the Company, absent prior written consent from the Company.
(c) During the Term of this Agreement, and for a period of six (6) months thereafter, Executive may not, directly or indirectly, entice, solicit or encourage any customer, prospective customer or supplier of the Company to cease doing business with the Company, reduce its relationship with the Company or refrain from establishing or expanding a relationship with the Company.
13. Withholdings
The Company may withhold and deduct from any payments made or to be made pursuant to this Agreement all federal, state, local and other taxes as may be required pursuant to any applicable law or governmental regulation or ruling and any other deductions consented to in writing by Executive.
14. Severability
It is the desire of the parties hereto that this Agreement be enforced to the maximum extent permitted by law and should any provision contained herein be held unenforceable by a court of competent jurisdiction or arbitrator (pursuant to Section 16), the parties hereby agree and consent that such provision will be reformed to create a valid and enforceable provision to the maximum extent permitted by law; provided, however, if such provision cannot be reformed, it will be deemed ineffective and deleted from this Agreement without affecting any other provision of this Agreement.
15. Title and Headings; Construction
Titles and headings to Sections and paragraphs are for the purpose of reference only and will in no way limit, define or otherwise affect the provisions of this Agreement. Any and all Exhibits referred to in this Agreement are, by such reference, incorporated herein and made a part hereof for all purposes. The words herein, hereof, hereunder and other compounds of the word here will refer to the entire Agreement and not to any particular provision hereof.
Both parties to this Agreement have approved all language in this Agreement and the language in this Agreement will not be strictly construed in favor of or against either party.
16. Arbitration; Injunctive Relief; Attorneys Fees
(a) Subject to Section 16(b), any dispute, controversy or claim between Executive and the Company arising out of or relating in any way to: (i) this Agreement, (ii) Executives employment with Company, or (iii) the termination of either (other than with respect to claims arising exclusively under one or more of the Companys employee benefit plans subject to ERISA), will be finally settled by confidential arbitration in Denver, Colorado before the American Arbitration Association in accordance with its then-existing rules for the resolution of employment disputes. The arbitrators award will be final and binding on both parties.
(b) Notwithstanding Section 16(a), an application for emergency, temporary, or preliminary injunctive relief by either party will not be subject to arbitration under this Section 16; provided, however, that the remainder of any such dispute (beyond the application for emergency, temporary, or preliminary injunctive relief) will be subject to arbitration under this Section 16. Executive acknowledges that Executives violation of Sections 10, 11 and/or 12 of this Agreement may cause irreparable harm to the Company. Executive agrees that the Company will be entitled as a matter of right to specific performance of Executives obligations under Sections 10, 11, and/or 12 and an emergency, temporary or preliminary injunction from any court of competent jurisdiction restraining any violation or further violation of such agreements by Executive or others acting on Executives behalf, without posting a bond. The Companys right to injunctive relief will be cumulative and in addition to any other remedies provided by law or equity.
(c) Each side will share equally the cost of the arbitrator and bear its own costs and attorneys fees incurred in connection with any arbitration, unless a statutory claim authorizing the award of attorneys fees is at issue, in which event the arbitrator may award a reasonable attorneys fee in accordance with the jurisprudence of that statute.
(d) Nothing in this Section 16 will prohibit a party to this Agreement from: (i) instituting litigation to enforce any arbitration award; or (ii) joining another party to this Agreement in litigation initiated by a person who is not a party to this Agreement.
17. Governing Law
THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS. THE EXCLUSIVE VENUE FOR THE RESOLUTION OF ANY DISPUTE RELATING TO THIS AGREEMENT OR EXECUTIVES EMPLOYMENT (THAT IS NOT SUBJECT TO ARBITRATION UNDER SECTION 16 FOR ANY REASON) SHALL BE IN THE STATE AND FEDERAL COURTS LOCATED IN OR NEAREST TO DENVER, COLORADO AND THE PARTIES HEREBY EXPRESSLY CONSENT TO THE JURISDICTION OF THOSE COURTS.
18. Entire Agreement and Amendment
This Agreement contains the entire agreement of the parties with respect to Executives employment and the other matters covered herein (except to the extent that other agreements are specifically referenced herein); moreover, this Agreement supersedes all prior and contemporaneous agreements and understandings, oral or written, between the parties hereto concerning the subject matter hereof and thereof. This Agreement may be amended, waived or terminated only by a written instrument executed by both parties hereto.
19. Survival of Certain Provisions
Wherever appropriate to the intention of the parties, the respective rights and obligations of the parties, including but not limited to the rights and obligations set forth in Sections 6 through 16, will survive any termination or expiration of this Agreement for any reason.
20. Waiver of Breach
No waiver by either party of a breach of any provision of this Agreement by the other party, or of compliance with any condition or provision of this Agreement to be performed by such other party, will operate or be construed as a waiver of any subsequent breach by such other party or any similar or dissimilar provision or condition at the same or any subsequent time. The failure of either party to take any action by reason of any breach will not deprive such party of the right to take action at any time while such breach continues.
21. Assignment
Neither this Agreement nor any rights or obligations hereunder will be assignable or otherwise subject to hypothecation by Executive (except by will or by operation of the laws of intestate succession) or by the Company, except as follows. This Agreement shall bind any successor of the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Agreement if no succession had taken place. In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Agreement, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Companys obligations under this Agreement, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. The term Company, as used in this Agreement, shall mean the Company as hereinbefore defined and any successor or assignee to the business or assets which by reason hereof becomes bound by this Agreement.
22. Notices
Notices provided for in this Agreement will be in writing and will be deemed to have been duly received: (a) when delivered in person or sent by facsimile with receipt confirmed; (b) on the first business day after such notice is sent by recognized express overnight courier service; or (c) on the third business day following deposit in the United States mail, registered or certified
mail, return receipt requested, postage prepaid and addressed, to the following address, as applicable:
(a) If to Company, addressed to: Potomac Corporate Center, Suite 300, 6950 South Potomac Street, Centennial, Colorado, 80112; Attn: President and Chief Executive Officer.
(b) If to Executive, addressed to the address provided to the Company, or
(c) To such other address as either party may have furnished to the other party in writing in accordance with this Section 22.
23. Counterparts
This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be an original, but all such counterparts will together constitute one and the same instrument. Each counterpart may consist of a copy hereof containing multiple signature pages, each signed by one party, but together signed by both parties.
24. Other Definitions
The parties agree that as used in this Agreement the following terms will have the following meanings: an affiliate of a person means any person directly or indirectly controlling, controlled by, or under common control with, such person; the terms controlling, controlled by, or under common control with mean the possession, directly or indirectly, of the power to direct or influence or cause the direction or influence of management or policies (whether through ownership of securities or other ownership interest or right, by contract or otherwise) of a person; the term person means a natural person, partnership (general or limited), limited liability Company, trust, estate, association, corporation, custodian, nominee, or any other individual or entity in its own or any representative capacity, in each case, whether domestic or foreign.
25. Internal Revenue Code Section 409A Compliance
(a) General The payments and benefits provided hereunder are intended to be exempt from or compliant with the requirements of Section 409A of the Code. Notwithstanding any provision of this Agreement to the contrary, in the event that the Company reasonably determines that any payments or benefits hereunder are not either exempt from or compliant with the requirements of Section 409A of the Code, the Company shall have the right to adopt such amendments to this Agreement or adopt such other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that are necessary or appropriate (i) to preserve the intended tax treatment of the payments and benefits provided hereunder, to preserve the economic benefits with respect to such payments and benefits, and/or (ii) to exempt such payments and benefits from Section 409A of the Code or to comply with the requirements of Section 409A of the Code and thereby avoid the application of penalty taxes or interest thereunder; provided, however, that this Section 25 does not, and shall not be construed so as to, create any obligation on the part of the Company to adopt any such amendments, policies or procedures or to take any other such actions or to indemnify the Executive for any failure to do so. Executive shall, at the request of the Company, take any
action (or refrain from taking any action) required to comply with any correction procedure promulgated pursuant to Section 409A of the Code.
(b) Exceptions to Apply The Company shall apply the exceptions provided in Treasury Regulation Section 1.409A-1(b)(4), Treasury Regulation Section 1.409A-1(b)(9) and all other applicable exceptions or provisions of Section 409A of the Code to the payments and benefits provided under this Agreement so that, to the maximum extent possible such payments and benefits are not nonqualified deferred compensation subject to Section 409A of the Code. All payments and benefits provided under this Agreement shall be deemed to be separate payments (and any payments made in installments shall be deemed a series of separate payments) and a separately identifiable or designated amount for purposes of Section 409A of the Code.
(c) Taxable Reimbursements To the extent that any payments or reimbursements provided to Executive are deemed to constitute nonqualified deferred compensation subject to Section 409A of the Code, such amounts shall be paid or reimbursed reasonably promptly, but not later than December 31 of the year following the year in which the expense was incurred. The amount of any payments or expense reimbursements that constitute compensation in one year shall not affect the amount of payments or expense reimbursements constituting compensation that are eligible for payment or reimbursement in any subsequent year, and Executives right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.
(d) Specified Employee Notwithstanding anything to the contrary in this Agreement, no compensation or benefits that are nonqualified deferred compensation subject to Section 409A of the Code shall be paid to Executive during the 6-month period following his Termination Date to the extent that the Company determines that Executive is a specified employee and that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first business day following the end of such 6-month period (or such earlier date upon which such amount can be paid under Section 409A of the Code without being subject to such additional taxes, including as a result of Executives death), the Company shall pay to Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to Executive during such 6-month period.
26. Full Settlement
The Companys obligations, if any, to make payments to Executive under Section 7 will not be reduced by any failure of Executive to seek other employment. The payments under Section 7 will not be reduced if Executive obtains other employment.
27. Indemnification and Directors and Officers Insurance
In Executives capacity as a director, officer, or employee of the Company or serving or having served any other entity as a director, officer, or employee at the Companys request, Executive shall be indemnified and held harmless by the Company to the fullest extent allowed by law, the Companys Certificate of Incorporation and Bylaws, from and against any and all
losses, claims, damages, liabilities, expenses (including legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, in which Executive may be involved, or threatened to be involved, as a party or otherwise by reason of Executives status, which relate to or arise out of the Company and such other entities, their assets, business or affairs, if in each of the foregoing cases, (i) Executive acted in good faith and in a manner Executive believed to be in the best interests of the Company, and, with respect to any criminal proceeding, had no reasonable cause to believe Executives conduct was unlawful, and (ii) Executives conduct did not constitute gross negligence or willful or wanton misconduct. The Company shall advance all reasonable expenses incurred by Executive in connection with the investigation, defense, settlement or appeal of any civil or criminal action or proceeding referenced in this Section, including but not necessarily limited to, reasonable fees of legal counsel, expert witnesses or other litigation-related expenses.
Executive and the Company have executed this Agreement as of the Signature Date.
EXECUTIVE: |
URANIUM RESOURCES, INC.: |
|
|
|
|
/s/ Jeffrey Vigil |
|
/s/ Christopher Jones |
Jeffrey L. Vigil |
|
Christopher M. Jones |
|
President and CEO |
Exhibit 10.6
SEPARATION AGREEMENT
AND GENERAL RELEASE
This Separation Agreement and General Release (Agreement) is made as of the 6th day of June, 2013 (Signature Date) between Mathew F. Lueras (Employee) and Uranium Resources, Inc. (the Company or URI), collectively referred to as the Parties.
RECITALS
Employee is employed by URI in the position of Vice President Corporate Development, which employment relationship is terminable at will by either party at any time without notice.
Employee is being terminated but the Parties wish to continue Employees employment under a contract for a limited period of time during which time Employee will transition Employees duties to others and perform other assigned tasks.
URI policy provides for severance pay at the discretion of the Company in exchange for a release of claims.
Employee is willing to give URI a general release of all claims, if any, arising from Employees employment with URI and the termination of that employment.
AGREEMENT
1. Continued Employment; Duties; Termination . Employees employment by URI will terminate effective at midnight, MDT, on June 30, 2013 (Termination Date). From the Signature Date until the Termination Date (Employment Period), URI will continue to employ Employee as Vice President Corporate Development. The Employment Period may only be
extended upon a mutual agreement of the Parties in a writing signed by the Parties that specifically refers to this Agreement. Employment Period and Termination Date also refer to any extensions of the original Employment Period in accordance with this Section 1. Employee will no longer be employed by the Company in any capacity after the Employment Period.
During the Employment Period, Employee will continue to devote substantially all of Employees professional time and efforts to the business of the Company, will act in the best interests of the Company and will cooperate with the President and Chief Executive Officer of the Company (President). Employees duties will include those normally performed by URIs Vice President Corporate Development and such additional duties as may be assigned by the President. If, in his sole and complete discretion, the President changes Employees title and/or Employees duties or responsibilities such changes will apply for purposes of this Agreement. Employee acknowledges that Employee owes the Company a fiduciary duty of loyalty and that any obligations described in this Agreement are in addition to, and not in lieu of, any obligations Employee owes the Company as a matter of law.
2. Transitional Duties . In addition, Employee will be responsible for completing the following tasks (Transitional Duties) during the Employment Period: (i) transition the duties of Vice President Corporate Development to the person(s) identified by the President; (ii) close all Company offices in New Mexico by terminating leases and cancelling utilities and other contractual support activities; and (iii) arrange for the shipment of furniture, files and other items to the Companys office in Denver.
3. Salary; Transition Bonus; Benefits . During the Employment Period, the Company will continue to pay Employees current annual base salary of $126,000 (Base Salary), less withholding, in accordance with the Companys regular payroll practices. If, in
the sole and complete discretion of the President, Employee works until the Termination Date and completes the Transitional Duties within the Employment Period, Employee will be eligible for a discretionary performance bonus (the Transition Bonus), which will consist of a lump sum payment equivalent to no more than three (3) weeks of Employees Base Salary less withholding. The amount, if any, of the Transition Bonus will be determined by the President acting in his sole and complete discretion, payable within twenty-one (21) days after the Termination Date, and based on the extent to which the Transitional Duties were timely completed.
During the Employment Period, Employee will continue to be eligible to participate in all employee benefits programs in which Employee participates as of the Signature Date. Within ten (10) days after the Termination Date, Employee will submit Employees final expense reimbursement statement and required documentation reflecting all business expenses Employee incurred through the Termination Date, if any, for which Employee seeks reimbursement. The Company will reimburse Employee for such final expenses within twenty-one (21) days of the Termination Date.
4. Return of Company Property . Upon demand of URI at any time, Employee will return to URI all originals and copies of all files, books, records, software and any other documents, materials and information of URI, including any records prepared by Employee, regardless of the form in which such information is maintained. At the same time, Employee will return to URI all other property of URI in Employees possession including but not limited to all keys, company car, cellular telephone, credit cards, computer, computer peripheral devices, personal digital assistant, and all other equipment of any kind. Further, Employee will provide URI with complete access to all URI servers, data bases and any other electronically stored information over which Employee has any control. If any information of URI is stored on any
computer or other digital or electronic device to which Employee has access, on or before the Termination Date Employee will verify that Employee no longer has access to such information. Employee also represents that Employee has not transferred, without authority, any confidential or proprietary information of URI to any third party.
5. Confidential Information . During the course of Employees employment, Employee acquired information that is confidential and/or proprietary to URI. Employee acknowledges a continuing obligation not to use or disclose, or allow the use or disclosure by others of, any confidential or proprietary information of URI without the prior express written consent of the President. If Employee is uncertain about whether any information is confidential Employee will treat such information as confidential until otherwise instructed by the President.
6. Severance Payment . As additional consideration for entering into this Agreement, and provided that Employee signs and does not revoke the Supplemental Release (attached to this Agreement) on or after the Termination Date, URI will pay Employee severance pay in an amount equivalent to three (3) weeks of Employees Base Salary, less withholding, payable in a lump sum within twenty-one (21) days after the Termination Date.
The Parties agree that in the absence of entering into this Agreement, Employee is not otherwise entitled to the consideration described in this Section 6. Employee will not receive any other payment or benefit from any other person or source whatsoever in exchange for entering into this Agreement. The Company has not and will not award any bonus payment to Employee for any service rendered in calendar year 2012 and has not and will not award any bonus payment or partial bonus payment to Employee for any service rendered in calendar year 2013 through the Termination Date (other than the possibility for a Transition Bonus as discussed in Section 3 of this Agreement), and Employee acknowledges that Employee has not and will not be awarded any bonus payment or any portion of any bonus payment for calendar
years 2012 or 2013 (other than the possibility for a Transition Bonus as discussed in Section 3 of this Agreement).
7. [Reserved]
8. Assistance to Company . Employee agrees that Employee will personally provide reasonable assistance and cooperation to URI and its agents and attorneys in activities related to the prosecution or defense of pending or future litigation, lawsuits, charges, or claims involving URI or its employees. Employee will promptly notify URI if Employee receives requests or inquiries from anyone other than a manager or agent of URI for information regarding URI which could reasonably be construed as seeking proprietary, non-public, or confidential information or if Employee becomes aware of any potential claim or proposed litigation against URI. If Employee is required by law or order of government authority to provide testimony regarding any matter related to URI, Employee agrees to consult with legal counsel designated by URI and will request and agree to such counsel being present for such testimony. URI agrees to pay the fees and costs of such designated counsel. Employee will cooperate with URI and URIs attorneys to assist their efforts and will hold all privileged communications in the strictest confidence unless ordered to do otherwise by a court of competent jurisdiction or other government authority.
9. Non-solicitation . For a period of two years after the Signature Date, Employee will not directly or indirectly on Employees own behalf or on behalf of any other entity: (a) solicit or induce any employee of URI to leave the employ of URI; or (b) use the services of any employee of URI in competition with URI. Employee acknowledges that money damages would not be a sufficient remedy for any breach of this Section 9 by Employee and agrees that URI will be entitled to specific performance and injunctive relief as remedies for any such breach or any threatened breach. Such remedies will not be deemed the exclusive remedies for a breach of this
Section 9 but will be in addition to all remedies available at law or in equity including, without limitation, the recovery of damages from Employee.
10. Release of Claims . Employee fully releases and forever discharges URI and all of the Released Parties (defined below) from all liability for any and all claims, demands, losses, liabilities, promises, and causes of action of any nature whatsoever (known and unknown) that Employee may now have or may have had arising on or before the Signature Date of this Agreement. This release includes, without limitation, all claims relating in any way to Employees employment by, association with, and termination of employment from URI (collectively referred to as Claims). THIS IS A GENERAL RELEASE subject only to the specific exceptions set forth below.
Claims released by Employee include, but are not limited to, any claims for monetary damages, salary, wages, bonuses, vacation, flex time, expenses, attorneys fees, indemnities, and other remedies or damages sought in any legal proceeding or charge filed with any court, federal, state or local agency either by Employee or by any person or entity claiming to act on Employees behalf or in Employees interest. Claims released include all claims under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, Section 1981, the Civil Rights Act of 1866, the Age Discrimination in Employment Act (ADEA) including the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Rehabilitation Act of 1973, the Equal Pay Act, the Ledbetter Fair Pay Act, the Immigration Reform and Control Act, the Uniformed Services Employment and Reemployment Rights Act, the Employee Retirement Income Security Act, the Workers Adjustment and Retraining Notification Act, the Fair Labor Standards Act, the Family and Medical Leave Act, Chapters 28 and 50 of the Annotated Statutes of New Mexico, including but not limited to the New Mexico Human Rights Act, and any other local, city, county, state or federal statutes, laws, regulations or ordinances prohibiting
harassment, discrimination or retaliation or otherwise governing the employment relationship. The Claims released include, but are not limited to, claims arising under any other federal, state, or local laws or causes of action restricting an employers right to terminate, discipline, promote, demote, or pay employees, or otherwise regulating employment including, but not limited to, any laws or causes of action related to: breach of implied employment contracts or covenants; wage and hour violations; wrongful discharge; breach of a bargaining agreement; any grievance under a bargaining agreement; breach of any contract, agreement or promise made prior to the Signature Date; physical or personal injury; medical expenses; mental anguish and/or emotional distress; intentional or negligent infliction of emotional distress; interference with contractual relations; fraud; intentional or negligent misrepresentation; libel; slander; defamation; invasion of privacy; violation of public policy; retaliatory discharge; breach of any sort of duty; prima facie tort or any other tort; claims for denial of due process or violation of corporate policy or procedure; and any other similar or related claims. The Claims released include claims seeking any monetary or other remedies for Employee, directly or indirectly, that in any way are brought on behalf of a government including, but not limited to, any proceeding under the qui tam provisions of the Civil False Claims Act, 31 U.S.C. §§ 3729 et seq ., whether or not the government joins the proceeding.
11. Release Exceptions . Employee understands that nothing herein prevents Employee from filing an administrative charge of discrimination with the United States Equal Employment Opportunity Commission (EEOC) or the New Mexico Department of Workforce Solutions Human Rights Bureau (DWS). Employee will not seek, accept, or be entitled to any monetary relief, whether for Employee individually or as a member of a class or group, arising from an EEOC or DWS charge filed by Employee or on Employees behalf. Employee acknowledges that nothing in this Release will be interpreted to discourage or interfere with
Employees rights under the Older Workers Benefit Protection Act to test the knowing and voluntary nature of the waiver of claims under the ADEA. Employee is not releasing: (a) any rights to enforce this Agreement; (b) any rights to benefits Employee may have under any benefit plans of URI (including any retirement plans or programs); (c) any claims for unemployment compensation; (d) any claims under applicable state and federal workers compensation and occupational injuries or illnesses statutes arising from Employees employment with URI; or (e) any rights of conversion or continuation of coverage under employee benefit plans of URI as provided in COBRA and other applicable law.
12. Released Parties . Released Parties means URI and its parent, subsidiary and affiliated corporations as well as their officers, directors, agents, and employees (other than Employee) whether acting in their individual or official capacities.
13. Non-liability . Employee acknowledges and agrees that liability for all claims which could have been asserted by Employee is denied by the Released Parties and this Agreement will never be treated by any person or entity at any time for any purpose as an admission or evidence of any liability or violation of law on the part of any Released Party.
14. ADEA Acknowledgements . Employee acknowledges voluntarily signing this Agreement and knowingly and voluntarily waiving any rights Employee may have under the ADEA. Employee further acknowledges that Employee has been advised by this writing, as required by the ADEA, that: (a) the waiver and release specified in this Section do not apply to any rights or claims that may arise after the date Employee signs this Agreement; (b) Employee has been advised to consult with an attorney prior to signing this Agreement; (c) Employee has at least twenty-one (21) days from the date that Employee first received this Agreement to consider this Agreement (although Employee may choose to sign it sooner); (d) Employee has seven (7) days after signing this Agreement to revoke it (Revocation Period); and (e) this Agreement
will not be effective until Employee has returned it to URIs President and the Revocation Period has expired (the Effective Date). The Parties agree that any changes to this Agreement during the twenty-one day (21) consideration period, whether the changes are material or immaterial, do not restart the running of that period. Employee acknowledges that no promise, inducement or agreement of any kind or character has been made to Employee by the Released Parties or anyone acting for them except as is expressly stated in this Agreement.
15. Confidentiality of Agreement . Employee will keep strictly confidential the existence of this Agreement as well as its terms, including the consideration described above, and that neither Employee nor any of Employees representatives or agents will communicate or otherwise disclose to any individual (except Employees spouse, legal counsel, and tax advisor), entity, representative of the news media, or member of the public at large the existence of or the specific terms or conditions of this Agreement, except with the written consent of URI or as may be required by law or order of any court. Employee agrees to advise Employees spouse, legal counsel, and tax advisor of this confidentiality provision and to use Employees best efforts to prevent disclosure by such persons.
16. Non-disparagement . Employee will not make any statements (directly or indirectly, in any individual or representative capacity) to the media or in any public forum, whether verbal or written, that disparage or may reasonably be interpreted to disparage any Released Party or URIs products or services. This provision covers electronic communications including, but not limited to, social networking sites, emails, and blogs.
17. Future References . Employee will direct to URIs President, only, any potential future employers or other parties seeking a reference on Employee from URI.
18. Pending Claims; Indemnity . Employee represents that all known or suspected violations of public policy, ethics, law, rule, or regulation, if any, have been disclosed in writing
to URI and that Employee has not filed any administrative claims or charges against URI with any local, tribal, state, or federal agency or court. Employee represents that Employee has not assigned or transferred any of the Claims to any person or entity. Employee agrees to indemnify and defend URI from any and all claims or damages arising out of any action brought by any assignee or transferee of the Claims.
19. Governing Law; Construction . This Agreement is made and entered into in the State of New Mexico and will be interpreted, enforced and governed under the laws of the State of New Mexico without reference to the principles of conflict of laws. The language of all parts of this Agreement will in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the Parties. Employee understands that this is a complete and final release that will be construed as broadly as possible to avoid litigation. In the event that any provision of this Agreement is for any reason held to be illegal or unenforceable, this Agreement will be revised only to the extent necessary to make this Agreement legal and enforceable.
20. Entire Agreement . This Agreement, including the Supplemental Release, contains the entire agreement between the Parties. This Agreement fully supersedes any and all prior agreements, arrangements, or understandings between the Parties relating to the subject matter of this Agreement. All prior and contemporaneous negotiations are incorporated into this Agreement or will be deemed abandoned if not incorporated into this Agreement. No oral understandings, statements, promises or inducements contrary to the terms of this Agreement exist. This Agreement cannot be changed or terminated orally.
[THIS SPACE INTENTIONALLY LEFT BLANK]
I, Mathew F. Lueras, HAVE CAREFULLY READ AND CONSIDERED THIS AGREEMENT AND FULLY UNDERSTAND THE EXTENT AND IMPACT OF ITS PROVISIONS. I HAVE HAD A FULL OPPORTUNITY TO CONSULT AN ATTORNEY CONCERNING THIS AGREEMENT. I HAVE SIGNED THIS AGREEMENT VOLUNTARILY AND WITHOUT ANY COERCION, UNDUE INFLUENCE, THREAT, OR INTIMIDATION OF ANY KIND OR TYPE WHATSOEVER. NO OTHER PROMISES HAVE BEEN MADE TO ME WITH RESPECT TO THIS MATTER. I UNDERSTAND THAT I MAY REVOKE THIS AGREEMENT WITHIN SEVEN (7) DAYS BY SIGNING A NOTICE OF REVOCATION AND NOTIFYING THE COMPANY OF SUCH REVOCATION AND THAT IF I DO NOT EXERCISE MY RIGHT TO REVOKE WITHIN SEVEN (7) DAYS, THIS AGREEMENT BECOMES IRREVOCABLE.
AGREED this 6th day of June, 2013. |
|
|
|
|
|
|
/s/ Mathew F. Lueras |
|
|
|
|
|
EMPLOYEE |
|
|
|
|
AGREED this 10th day of June, 2013, for URI: |
|
|
|
|
|
|
By |
/s/ Christopher Jones |
|
|
|
|
Christopher M. Jones, President and CEO |
Exhibit 31.1
Certification of Chief Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Christopher Jones, certify that:
1. I have reviewed this report on Form 10-Q of Uranium Resources, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: August 13, 2013
|
/s/ Christopher Jones |
|
Title: President and Chief Executive Officer |
Exhibit 31.2
Certification of Chief Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Jeffrey L. Vigil, certify that:
1. I have reviewed this report on Form 10-Q of Uranium Resources, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: August 13, 2013
|
/s/ Jeffrey L. Vigil |
|
Title: Vice President - Finance and Chief Financial Officer |
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Christopher Jones, President and Chief Executive Officer of Uranium Resources, Inc. (the Company), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
(1) The Quarterly Report on Form 10-Q of the Company for the period ended June 30, 2013 which this certification accompanies fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Christopher Jones |
|
Christopher Jones |
|
President and Chief Executive Officer |
|
August 13, 2013 |
|
Exhibit 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Jeffrey L. Vigil, Vice President - Finance and Chief Financial Officer of Uranium Resources, Inc. (the Company), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
(1) The Quarterly Report on Form 10-Q of the Company for the period ended June 30, 2013, which this certification accompanies fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Jeffrey L. Vigil |
|
Jeffrey L. Vigil |
|
Vice President - Finance and Chief Financial Officer |
|
August 13, 2013 |
|