Exhibit 99.1
Ur-Energy Inc.
(a Development Stage Company)
Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
Ur-Energy Inc.
(a Development Stage Company)
Unaudited Interim Consolidated Balance Sheets
(expressed in Canadian dollars)
September 30, 2009 | December 31, 2008 | |||||||
$ | $ | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents (note 4) | 48,453,559 | 25,799,735 | ||||||
Short-term investments (note 4) | 363,135 | 39,174,200 | ||||||
Marketable securities | 38,250 | 7,500 | ||||||
Amounts receivable | 57,307 | 132,710 | ||||||
Prepaid expenses | 233,375 | 77,777 | ||||||
49,145,626 | 65,191,922 | |||||||
Bonding and other deposits (note 5) | 3,022,187 | 2,578,825 | ||||||
Mineral properties (note 6) | 29,533,955 | 31,808,821 | ||||||
Capital assets (note 7) | 1,399,540 | 1,631,304 | ||||||
Construction in progress (note 8) | 1,435,594 | 323,093 | ||||||
Investments (note 9) | 2,769,117 | - | ||||||
38,160,393 | 36,342,043 | |||||||
87,306,019 | 101,533,965 | |||||||
Liabilities and shareholders' equity | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued liabilities | 1,192,658 | 2,265,058 | ||||||
1,192,658 | 2,265,058 | |||||||
Future income tax liability | 478,000 | 478,000 | ||||||
Asset retirement obligation (note 10) | 537,620 | 513,576 | ||||||
2,208,278 | 3,256,634 | |||||||
Shareholders' equity (note 11) | ||||||||
Capital stock | 144,053,337 | 144,396,460 | ||||||
Contributed surplus | 13,478,113 | 12,721,559 | ||||||
Deficit | (72,433,709 | ) | (58,840,688 | ) | ||||
85,097,741 | 98,277,331 | |||||||
87,306,019 | 101,533,965 |
The accompanying notes are an integral part of these consolidated financial statements
Approved by the Board of Directors
(signed) /s/ Jeffery T. Klenda, Director | (signed) /s/ Thomas Parker, Director |
Page 1
Ur-Energy Inc.
(a Development Stage Company)
Unaudited Interim Consolidated Statements of Operations, Comprehensive Loss and Deficit
(expressed in Canadian dollars)
Cumulative | ||||||||||||||||||||
from | ||||||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | March 22, 2004 | ||||||||||||||||
Ended | Ended | Ended | Ended | Through | ||||||||||||||||
September 30, | September 30, | September 30, | September 30, | September 30, | ||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2009 | ||||||||||||||||
$ | $ | $ | $ | $ | ||||||||||||||||
(as restated - see Note 3) | (as restated - see Note 3) | |||||||||||||||||||
Expenses | ||||||||||||||||||||
General and administrative | 1,248,210 | 2,427,921 | 4,008,718 | 6,032,435 | 25,931,767 | |||||||||||||||
Exploration and evaluation | 2,214,050 | 4,068,091 | 4,724,946 | 7,958,531 | 44,507,499 | |||||||||||||||
Development | 1,878,899 | 2,404,895 | 5,152,967 | 3,743,462 | 14,007,503 | |||||||||||||||
Write-off of mineral properties | (4,623 | ) | 285,813 | 102,439 | 285,813 | 422,084 | ||||||||||||||
(5,336,536 | ) | (9,186,720 | ) | (13,989,070 | ) | (18,020,241 | ) | (84,868,853 | ) | |||||||||||
Interest income | 130,519 | 573,608 | 749,899 | 1,963,297 | 6,828,338 | |||||||||||||||
Loss from affiliate | (13,490 | ) | - | (13,490 | ) | - | (13,490 | ) | ||||||||||||
Foreign exchange gain (loss) | (814,255 | ) | (425,801 | ) | (2,112,975 | ) | 70,349 | 3,455,264 | ||||||||||||
Other income (loss) | 1,085,947 | (18,203 | ) | 975,115 | (26,888 | ) | 938,477 | |||||||||||||
388,721 | 129,604 | (401,451 | ) | 2,006,758 | 11,208,589 | |||||||||||||||
Loss before income taxes | (4,947,815 | ) | (9,057,116 | ) | (14,390,521 | ) | (16,013,483 | ) | (73,660,264 | ) | ||||||||||
Recovery of future income taxes (note 11) | 797,500 | - | 797,500 | - | 1,226,555 | |||||||||||||||
Net loss and comprehensive loss for the period | (4,150,315 | ) | (9,057,116 | ) | (13,593,021 | ) | (16,013,483 | ) | (72,433,709 | ) | ||||||||||
Deficit - Beginning of period | ||||||||||||||||||||
As previously reported | (68,283,394 | ) | (16,797,717 | ) | (58,840,688 | ) | (13,080,150 | ) | - | |||||||||||
Change in policy for accounting for exploration and development costs (note 3) | - | (31,145,753 | ) | - | (27,906,953 | ) | - | |||||||||||||
As restated | (68,283,394 | ) | (47,943,470 | ) | (58,840,688 | ) | (40,987,103 | ) | - | |||||||||||
Deficit - End of period | (72,433,709 | ) | (57,000,586 | ) | (72,433,709 | ) | (57,000,586 | ) | (72,433,709 | ) | ||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||||||
Basic and diluted | 93,907,324 | 92,243,607 | 93,829,182 | 92,913,315 | ||||||||||||||||
Loss per common share: | ||||||||||||||||||||
Basic and diluted | (0.04 | ) | (0.09 | ) | (0.14 | ) | (0.17 | ) |
The accompanying notes are an integral part of these consolidated financial statements
Page 2
Ur-Energy Inc.
(a Development Stage Company)
Unaudited Interim Consolidated Statements of Cash Flow
(expressed in Canadian dollars)
Cumulative | ||||||||||||||||||||
from | ||||||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | March 22, 2004 | ||||||||||||||||
Ended | Ended | Ended | Ended | Through | ||||||||||||||||
September 30, | September 30, | September 30, | September 30, | September 30, | ||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2009 | ||||||||||||||||
$ | $ | $ | $ | $ | ||||||||||||||||
(as restated - see Note 3) | (as restated - see Note 3) | |||||||||||||||||||
Cash provided by (used in) | ||||||||||||||||||||
Operating activities | ||||||||||||||||||||
Net loss for the period | (4,150,315 | ) | (9,057,116 | ) | (13,593,021 | ) | (16,013,483 | ) | (72,433,709 | ) | ||||||||||
Items not affecting cash: | ||||||||||||||||||||
Stock based compensation | 282,314 | 2,195,006 | 757,288 | 4,243,892 | 15,519,485 | |||||||||||||||
Amortization of capital assets | 125,820 | 121,261 | 414,874 | 351,495 | 1,040,938 | |||||||||||||||
Provision for reclamation | 14,430 | 91,528 | 91,396 | 86,553 | 533,992 | |||||||||||||||
Write-off of mineral properties | (4,623 | ) | 321,601 | 102,439 | 321,601 | 422,084 | ||||||||||||||
Foreign exchange loss (gain) | 814,255 | 425,801 | 2,112,975 | (70,349 | ) | (3,455,264 | ) | |||||||||||||
Gain on sale of assets | 3,432 | (5,361 | ) | 3,432 | (5,361 | ) | (1,929 | ) | ||||||||||||
Non-cash exploration costs (credits) | - | - | - | - | 2,726,280 | |||||||||||||||
Other loss (income) | (5,250 | ) | 30,250 | (22,250 | ) | 42,250 | (7,252 | ) | ||||||||||||
Future income taxes | (797,500 | ) | - | (797,500 | ) | - | (1,226,555 | ) | ||||||||||||
Change in non-cash working capital items: | ||||||||||||||||||||
Amounts receivable | 10,109 | 7,372 | 69,956 | 747,562 | (45,609 | ) | ||||||||||||||
Prepaid expenses | (57,438 | ) | 5,385 | (172,605 | ) | (76,707 | ) | (233,536 | ) | |||||||||||
Accounts payable and accrued liabilities | 542,642 | 23,207 | (972,822 | ) | (76,955 | ) | 995,293 | |||||||||||||
(3,222,124 | ) | (5,841,066 | ) | (12,005,838 | ) | (10,449,502 | ) | (56,165,782 | ) | |||||||||||
Investing activities | ||||||||||||||||||||
Mineral property costs | 8,826 | �� | (605,696 | ) | (156,372 | ) | (858,309 | ) | (10,617,184 | ) | ||||||||||
Construction in progress | (707,958 | ) | - | (1,112,501 | ) | - | (1,435,594 | ) | ||||||||||||
Purchase of short-term investments | (300,753 | ) | (11,719,656 | ) | (26,412,446 | ) | (63,507,378 | ) | (154,092,937 | ) | ||||||||||
Sale of short-term investments | 25,854,963 | 26,654,787 | 64,816,227 | 76,643,808 | 155,438,145 | |||||||||||||||
Decrease (increase) in bonding and other deposits | 352,706 | (310,711 | ) | (878,982 | ) | (480,848 | ) | (2,990,336 | ) | |||||||||||
Proceeds from sale of capital assets | - | 26,344 | - | 26,344 | 26,344 | |||||||||||||||
Purchase of capital assets | (61,443 | ) | (366,468 | ) | (183,110 | ) | (1,330,624 | ) | (2,418,869 | ) | ||||||||||
25,146,341 | 13,678,600 | 36,072,816 | 10,492,993 | (16,090,431 | ) | |||||||||||||||
Financing activities | ||||||||||||||||||||
Issuance of common shares and warrants for cash | - | - | - | 2,750,000 | 122,668,053 | |||||||||||||||
Share issue costs | - | - | - | (115,314 | ) | (2,569,025 | ) | |||||||||||||
Proceeds from exercise of warrants, compensation | ||||||||||||||||||||
options and stock options | 1,392 | - | 1,392 | 90,000 | 18,569,323 | |||||||||||||||
Payment of New Frontiers obligation | - | - | - | - | (17,565,125 | ) | ||||||||||||||
1,392 | - | 1,392 | 2,724,686 | 121,103,226 | ||||||||||||||||
Effects of foreign exchange rate changes on cash | (677,174 | ) | (515,909 | ) | (1,414,546 | ) | (33,433 | ) | (393,454 | ) | ||||||||||
Net change in cash and cash equivalents | 21,248,435 | 7,321,625 | 22,653,824 | 2,734,744 | 48,453,559 | |||||||||||||||
Beginning cash and cash equivalents | 27,205,124 | 21,725,876 | 25,799,735 | 26,312,757 | - | |||||||||||||||
Ending cash and cash equivalents | 48,453,559 | 29,047,501 | 48,453,559 | 29,047,501 | 48,453,559 | |||||||||||||||
Non-cash financing and investing activities: | ||||||||||||||||||||
Common shares issued for properties | 42,750 | - | 452,250 | - |
The accompanying notes are an integral part of these consolidated financial statements
Page 3
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
1. | Nature of operations |
Ur-Energy Inc. (the "Company") is a development stage junior mining company engaged in the identification, acquisition, evaluation, exploration and development of uranium mineral properties in Canada and the United States. Due to the nature of the uranium mining methods to be used by the Company on the Lost Creek property, and the definition of “mineral reserves” under NI 43-101, which uses the CIM Definition Standards, the Company has not determined whether the properties contain mineral reserves. However, the Company’s April 2008 “NI 43-101 Preliminary Assessment for the Lost Creek Project Sweetwater County, Wyoming” outlines the economic viability of the Lost Creek project, which is currently in the permitting process with state and federal regulators. The recoverability of amounts recorded for mineral properties is dependent upon the discovery of economically recoverable resources, the ability of the Company to obtain the necessary financing to develop the properties and upon attaining future profitable production from the properties or sufficient proceeds from disposition of the properties.
2. | Significant accounting policies |
Basis of presentation
Ur-Energy Inc. was incorporated on March 22, 2004 under the laws of the Province of Ontario. The Company continued under the Canada Business Corporation Act on August 7, 2006. These financial statements have been prepared by management in accordance with accounting principles generally accepted in Canada and include all of the assets, liabilities and expenses of the Company and its wholly-owned subsidiaries Ur-Energy USA Inc., NFU Wyoming, LLC, Lost Creek ISR, LLC, NFUR Bootheel, LLC, Hauber Project LLC, NFUR Hauber, LLC, ISL Resources Corporation, ISL Wyoming, Inc. and CBM-Energy Inc. All inter-company balances and transactions have been eliminated upon consolidation. Ur-Energy Inc. and its wholly-owned subsidiaries are collectively referred to herein as the “Company”. The Bootheel Project, LLC which was consolidated in prior periods is no longer consolidated since the Company’s equity interest has been reduced to 25% as discussed in Note 6- Mineral Properties.
The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. Except as set out below, the accounting policies used in the preparation of the unaudited interim consolidated financial statements conform to those used in the Company’s annual financial statements for the year ended December 31, 2008 and reflect all normal and recurring adjustments considered necessary to fairly state the results for the periods presented.
These unaudited interim consolidated financial statements do not conform in all respects to the requirements of generally accepted accounting principles for annual financial statements. These unaudited interim consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements for the year ended December 31, 2008.
Certain comparative figures have been reclassified to conform to the presentation adopted for the current period.
Adoption of new accounting pronouncement
Sections 3064 – Goodwill and Intangible Assets
Page 4
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
Effective January 1, 2009, the Company adopted CICA Handbook Section 3064, “Goodwill and Intangible Assets”, which replaces Section 3062, “Goodwill and Intangible Assets”. The new standard establishes revised standards for the recognition, measurement, presentation and disclosure of goodwill and intangible assets. The new standard also provides guidance for the treatment of preproduction and start-up costs and requires that these costs be expensed as incurred. The adoption of this standard did not have a material impact on the consolidated financial statements.
3. | Exploration accounting policy change |
In December 2008, the Company changed its policy for accounting for exploration and development expenditures. In prior years, the Company capitalized all direct exploration and development expenditures. Under its new policy, exploration, evaluation and development expenditures, including annual exploration license and maintenance fees, are charged to earnings as incurred until the mineral property becomes commercially mineable.
Management considers that a mineral property will become commercially mineable when management has determined it is economically viable and it can be legally mined, as indicated by the receipt of key permits. Development expenditures incurred subsequent to the receipt of key permits will be capitalized and amortized on the unit-of-production method based upon the estimated recoverable resource of the mineral property. Management believes that this treatment provides a more relevant and reliable depiction of the Company’s asset base and more appropriately aligns the Company’s policies with those of comparable companies in the mining industry at a similar stage.
The Company has accounted for this change in accounting policy on a retroactive basis. The comparative operating results for the three and nine months ended September 30, 2008 were restated as follows: expenses increased by $5.4 million and $8.7 million, net loss increased by $5.8 million and $9.0 million, and loss per common share increased by $0.06 and $0.09, respectively.
The Company will continue to capitalize the acquisition costs of mineral properties and capital assets.
4. | Cash and cash equivalents and short-term investments |
The Company’s cash and cash equivalents are comprised of:
As at | As at | ||||||
September 30, | December 31, | ||||||
2009 | 2008 | ||||||
$ | $ | ||||||
Cash on deposit at banks | 620,586 | 392,170 | |||||
Guaranteed investment certificates | 2,787,500 | 9,087,500 | |||||
Money market funds | 25,495,673 | 1,031,882 | |||||
Certificates of deposit | 19,549,800 | 15,288,183 | |||||
48,453,559 | 25,799,735 |
The Company’s cash and cash equivalents of $48.4 million and short-term investments of $0.4 million consist of Canadian dollar and US dollar denominated deposit accounts, guaranteed investment certificates, money
Page 5
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
market funds and certificates of deposits. They bear interest at annual rates ranging from 0.15% to 3.0% and mature at various dates up to July 10, 2010. The instruments with initial maturity over three months have been classified as short-term investments.
These instruments are maintained at financial institutions in Canada and the United States. Of these amounts, approximately $7.5 million is covered by either the Canada Deposit Insurance Corporation or the Federal Deposit Insurance Corporation; leaving approximately $41.4 million at risk should the financial institutions with which these amounts are invested be rendered insolvent. As at September 30, 2009, the Company does not consider any of its financial assets to be impaired.
5. | Bonding and other deposits |
Bonding and other deposits include $3,002,637 (December 31, 2008 – $2,556,815) of reclamation bonds deposited with United States financial institutions as collateral to cover potential costs of reclamation related to properties. Once the reclamation is complete, the bonding deposits will be returned to the Company.
6. | Mineral properties |
Canada | USA | Total | ||||||||||
Canadian | Lost Creek/ | Other US | ||||||||||
Properties | Lost Soldier | Properties | ||||||||||
$ | $ | $ | $ | |||||||||
Balance, December 31, 2008 | 617,160 | 24,316,716 | 6,874,945 | 31,808,821 | ||||||||
Acquisiton costs | - | - | 399,564 | 399,564 | ||||||||
Staking and claim costs | (30,021 | ) | 4,922 | 9,665 | (15,434 | ) | ||||||
Labor costs | 90 | 2,905 | 155,893 | 158,888 | ||||||||
Material and supply costs | - | 1,065 | 1,065 | |||||||||
Outside service costs | - | - | 55,717 | 55,717 | ||||||||
Other costs | - | - | 322 | 322 | ||||||||
Basis of property write-offs | (63,561 | ) | - | (38,878 | ) | (102,439 | ) | |||||
Basis of assets sold | (3,432 | ) | (3,432 | ) | ||||||||
Property reclassified as investment (note 9) | (2,769,117 | ) | (2,769,117 | ) | ||||||||
Balance, September 30, 2009 | 523,668 | 24,324,543 | 4,685,744 | 29,533,955 |
Canada
The Company's Canadian properties include Screech Lake, which is located in the Thelon Basin, Northwest Territories and Bugs, which is located in the Kivalliq region of the Baker Lake Basin, Nunavut. During the nine months ended September 30, 2009, the Company wrote off mineral property costs associated with the Eyeberry claims.
Page 6
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
United States
Lost Creek and Lost Soldier
The Company acquired certain of its Wyoming properties when Ur-Energy USA entered into the Membership Interest Purchase Agreement (“MIPA”) with New Frontiers Uranium, LLC effective June 30, 2005. Under the terms of the MIPA, the Company purchased 100% of the issued and outstanding membership interests in NFU Wyoming, LLC. Assets acquired in this transaction include the extensively explored and drilled Lost Creek and Lost Soldier projects, and a development database including more than 10,000 electric well logs, over 100 geologic reports and over 1,000 geologic and uranium maps covering large areas of Wyoming, Montana and South Dakota. The 100% interest in NFU Wyoming was purchased for an aggregate consideration of $24,515,832 (US$20,000,000) plus capitalized interest.
A royalty on future production of 1.67% is in place with respect to 20 claims comprising a small portion of the Lost Creek project claims.
Other US Properties
The Company’s other US properties include EN, LC North and LC South, and RS, which are located in Wyoming.
In January 2009, the Company entered into certain agreements for the transfer of certain land claims, royalties and other property rights for an aggregate consideration of 650,000 common shares and US$64,000. The acquisitions were primarily related to additions to the Company’s EN claim group.
During the second quarter of 2009, the Company wrote-off its Muggins’ Mountain claims in Arizona.
In the third quarter of 2009, the other member of The Bootheel Project, LLC (the “Project”) completed its earn-in requirement resulting in a reduction in the Company’s interest to 25%. As a result, the Buck Point and Bootheel properties are not a part of mineral properties and the Project is now reflected as an Investment (See Note 9).
On August 25, 2009, the Company sold its database of geologic information related to its Moorcroft project in Wyoming for US$1.0 million and a royalty on future production from a broad-ranging project area in the Eastern Powder River Basin of Wyoming. As the project is still in exploration and evaluation, management of the Company does not have enough information to determine if any royalties will ever by paid and therefore is not attributing any value to those royalties. The gain on this sale is reported in Other Income in the Statement of Operations.
On August 26, 2009, the Company entered into an agreement to acquire 141 mining claims that will become part of the LC South Project. The Company paid the annual claim maintenance fees in August 2009 and the agreement closed on September 2, 2009 with the issuance of 45,000 common shares.
Page 7
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
7. | Capital assets |
September 30, 2009 | December 31, 2008 | ||||||||||||||||||
Accumulated | Net Book | Accumulated | Net Book | ||||||||||||||||
Cost | Amortization | Value | Cost | Amortization | Value | ||||||||||||||
$ | $ | $ | $ | $ | $ | ||||||||||||||
Light vehicles | 661,743 | 319,274 | 342,469 | 656,184 | 215,238 | 440,946 | |||||||||||||
Heavy mobile equipment | 473,335 | 185,586 | 287,749 | 424,559 | 103,903 | 320,656 | |||||||||||||
Machinery and equipment | 782,376 | 363,993 | 418,383 | 780,085 | 232,390 | 547,695 | |||||||||||||
Furniture and fixtures | 221,867 | 70,989 | 150,878 | 189,987 | 48,829 | 141,158 | |||||||||||||
Computer equipment | 220,197 | 97,720 | 122,477 | 178,633 | 66,672 | 111,961 | |||||||||||||
Software | 171,059 | 93,475 | 77,584 | 125,411 | 56,523 | 68,888 | |||||||||||||
2,530,577 | 1,131,037 | 1,399,540 | 2,354,859 | 723,555 | 1,631,304 |
8. | Construction in progress |
USA | ||||||||||||
Plant Design | Plant Equipment | Outside Services | Lost Creek | |||||||||
$ | $ | $ | $ | |||||||||
Balance, December 31, 2008 | 323,093 | 0 | 0 | 323,093 | ||||||||
Additions during year | 112,678 | 997,070 | 2,753 | 1,112,501 | ||||||||
Balance, September 30, 2009 | 435,771 | 997,070 | 2,753 | 1,435,594 |
9. | Investments |
In the third quarter of 2009, the other member of The Bootheel Project, LLC (the “Project”) completed its earn-in requirement by spending US$ 3.0 million and now has a 75% interest in the Project with the Company retaining the other 25%. As a result the Company is no longer the controlling member of the Project. Therefore the manner in which the costs for the Project’s Bootheel and Buck Point properties is reported in the financial statements has changed from being fully consolidated in the Company’s accounts to the Project being treated as an equity investment. This equity investment is accounted for under the equity accounting method with the net investment reflected on the Balance Sheet. The Company’s share of expenses incurred will be shown as loss from affiliate on the Statement of Operations.
Page 8
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
10. | Asset retirement obligation |
The Company has recorded $537,620 for asset retirement obligations (December 31, 2008 – $513,576) which represents an estimate of costs that would be incurred to remediate the exploration and development properties. The retirement obligations recorded relate entirely to exploration and development drill holes, related monitor wells and site disturbance on the Company's Wyoming properties.
11. | Income taxes |
During 2008, the Company raised $2,750,000 through the sale of common stock covered by a flow-through election. This election requires that all capital raised under this election be used for exploration and evaluation of Canadian mineral interests prior to the end of the following calendar year. The Company then files a document with Revenue Canada renouncing its right to claim those expenditures for income tax purposes and pass them through to the purchasers of the common stock.
During 2009, the Company filed the renouncement with the taxing authorities and completed the expenditure of the funds raised in 2008. As a result, the Company recognized the future tax benefit that was renounced.
12. | Shareholders’ equity and capital stock |
Authorized
The Company is authorized to issue an unlimited number of common shares and an unlimited number of Class A preference shares with the rights, privileges and restrictions as determined by the Board of Directors at the time of issuance.
No class A preference shares have been issued
Capital Stock | Contributed | Accumulated | Shareholders' | |||||||||||||
Shares | Amount | Surplus | Deficit | Equity | ||||||||||||
# | $ | $ | $ | $ | ||||||||||||
Balance, December 31, 2008 | 93,243,607 | 144,396,460 | 12,721,559 | (58,840,688 | ) | 98,277,331 | ||||||||||
Common shares issued for properties | 695,000 | 452,250 | 452,250 | |||||||||||||
Exercise of stock options | 1,961 | 2,127 | (734 | ) | 1,393 | |||||||||||
Income tax portion of flowthrough stock sale | (797,500 | ) | (797,500 | ) | ||||||||||||
Non-cash stock compensation | - | - | 757,288 | - | 757,288 | |||||||||||
Net loss and comprehensive loss | - | - | - | (13,593,021 | ) | (13,593,021 | ) | |||||||||
Balance, September 30, 2009 | 93,940,568 | 144,053,337 | 13,478,113 | (72,433,709 | ) | 85,097,741 |
Issuances
In January 2009, the Company entered into certain agreements for the transfer of certain land claims, royalties and other property rights for an aggregate consideration of 650,000 common shares and US$64,000. The acquisitions were primarily related to additions to the Company’s EN claim group.
Page 9
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
On August 26, 2009, the Company entered into an agreement to acquire 141 mining claims that will become part of the LC South Project. The Company paid the annual claim maintenance fees in August 2009 and the agreement closed on September 2, 2009 with the issuance of 45,000 common shares.
During 2009, 1,961 common shares were issued pursuant to the exercise of stock options.
Stock options
On November 17, 2005, the Company’s Board of Directors approved the adoption of the Company's stock option plan (the “Plan”). Eligible participants under the Plan include directors, officers and employees of the Company and consultants to the Company. Under the terms of the Plan, options generally vest with Plan participants as follows: 10% at the date of grant; 22% four and one-half months after grant; 22% nine months after grant; 22% thirteen and one-half months after grant; and, the balance of 24% eighteen months after the date of grant.
Activity with respect to stock options is summarized as follows:
Weighted- | ||||||||
average | ||||||||
Options | exercise price | |||||||
# | $ | |||||||
Outstanding, December 31, 2008 | 6,228,700 | 1.46 | ||||||
Granted | 2,204,264 | 0.80 | ||||||
Exercised | (1,961 | ) | 0.71 | |||||
Forfeit | (36,900 | ) | 2.07 | |||||
Expired | (11,200 | ) | 1.65 | |||||
Outstanding, September 30, 2009 | 8,382,903 | 1.28 |
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Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
As at September 30, 2009, outstanding stock options are as follows:
Options outstanding | Options exercisable | |||||||||||||||
Weighted- | Weighted- | |||||||||||||||
average | average | |||||||||||||||
Exercise | remaining | remaining | ||||||||||||||
price | Number | contractual | Number | contractual | ||||||||||||
$ | of options | life (years) | of options | life (years) | Expiry | |||||||||||
1.25 | 2,440,800 | 1.1 | 2,440,800 | 1.1 | November 17, 2010 | |||||||||||
2.01 | 75,000 | 1.5 | 75,000 | 1.5 | March 25, 2011 | |||||||||||
2.35 | 1,450,000 | 1.6 | 1,450,000 | 1.6 | April 21, 2011 | |||||||||||
2.75 | 379,200 | 2.0 | 379,200 | 2.0 | September 26, 2011 | |||||||||||
4.75 | 45,000 | 2.6 | 45,000 | 2.6 | May 15, 2012 | |||||||||||
3.67 | 200,000 | 2.8 | 200,000 | 2.8 | July 15, 2012 | |||||||||||
3.00 | 437,500 | 2.9 | 437,500 | 2.9 | August 9, 2012 | |||||||||||
3.16 | 50,000 | 3.0 | 50,000 | 3.0 | September 17, 2012 | |||||||||||
2.98 | 50,000 | 3.0 | 50,000 | 3.0 | October 5, 2012 | |||||||||||
4.07 | 30,000 | 3.1 | 30,000 | 3.1 | November 7, 2012 | |||||||||||
2.11 | 25,000 | 3.5 | 25,000 | 3.5 | March 19, 2013 | |||||||||||
1.65 | 980,000 | 3.6 | 748,400 | 3.6 | May 8, 2013 | |||||||||||
1.72 | 25,000 | 3.9 | 19,000 | 3.9 | August 6, 2013 | |||||||||||
0.71 | 991,612 | 4.4 | 318,192 | 4.4 | February 9, 2014 | |||||||||||
0.64 | 75,000 | 4.4 | 24,000 | 4.4 | March 11, 2014 | |||||||||||
0.90 | 1,128,791 | 4.9 | 112,881 | 4.9 | September 2, 2014 | |||||||||||
1.65 | 8,382,903 | 2.5 | 6,404,973 | 2.2 |
During the nine months ended September 30, 2009, the Company recorded a total of $757,288 related to stock option compensation (2008 – $4,243,892). This amount is included in shareholders’ equity as contributed surplus and is recorded as an expense. The fair value of options granted during the nine months ended September 30, 2009 and 2008 was determined using the Black-Scholes option pricing model with the following assumptions:
2009 | 2008 | |||||||
Expected option life (years) | 2.85 - 3.01 | 4.0 | ||||||
Expected volatility | 82 - 83 | % | 65 | % | ||||
Risk-free interest rate | 1.4 - 1.9 | % | 3.0% - 3.4 | % | ||||
Forfeiture rate | 4.4 - 4.6 | % | - | |||||
Expected dividend rate | 0 | % | 0 | % |
13. | Segmented information |
The Company’s operations comprise one reportable segment being the exploration and development of uranium resource properties. The Company operates in Canada and the United States. Capital assets segmented by geographic area are as follows:
Page 11
Ur-Energy Inc.
(a Development Stage Company)
Notes to Unaudited Interim Consolidated Financial Statements
September 30, 2009
(expressed in Canadian dollars)
September 30, 2009 | ||||||||||||
Canada | United States | Total | ||||||||||
$ | $ | $ | ||||||||||
Bonding and other deposits | - | 3,022,187 | 3,022,187 | |||||||||
Mineral properties | 523,666 | 29,010,289 | 29,533,955 | |||||||||
Capital assets | 3,088 | 1,396,452 | 1,399,540 | |||||||||
Construction in progress | - | 1,435,594 | 1,435,594 | |||||||||
Investments | - | 2,769,117 | 2,769,117 |
December 31, 2008 | ||||||||||||
Canada | United States | Total | ||||||||||
$ | $ | $ | ||||||||||
Bonding and other deposits | - | 2,578,825 | 2,578,825 | |||||||||
Mineral exploration properties | 617,160 | 31,191,661 | 31,808,821 | |||||||||
Capital assets | 7,847 | 1,623,457 | 1,631,304 | |||||||||
Construction in progress | - | 323,093 | 323,093 | |||||||||
Investments | - | - | - |
14. | Commitments |
Although construction of the Lost Creek plant will not begin until receipt of the necessary permits, request for quotations for all major process equipment at the Lost Creek project were prepared and solicited from vendors and contractors. Bids are currently being evaluated and procurement will be ongoing throughout 2009.
One purchase order totaling US$1,323,834 was issued during the second quarter of 2009 for ion exchange columns and other process equipment. Payments of US$861,370 have been made with the final payment due upon completion. An additional purchase order for US$319,357 was issued during the second quarter in order to initiate the drawing and approval process for other plant equipment. Progress payments will be required once the final drawings are approved, the final configuration is decided upon and the final price is determined.
As at September 30, 2009, the Company has spent or accrued all of the funds in accordance with flow-through share agreements in Canada.
Page 12