URANIUM ENERGY CORP 10-Q

Item 1. Financial Statements 3 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED APRIL 30, 2021 (Unaudited – Expressed in U.S. Dollars) 4 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited – Expressed in U.S. Dollars) Note(s) April 30, 2021 July 31, 2020 CURRENT ASSETS Cash and cash equivalents 7 $ 43,930,316 $ 5,147,703 Term deposits 3 4,000,000 - Inventories 4 26,405,480 211,662 Prepaid expenses and deposits 1,961,448 1,111,152 Other current assets 133,265 119,362 TOTAL CURRENT ASSETS 76,430,509 6,589,879 MINERAL RIGHTS AND PROPERTIES 5 63,734,378 63,655,503 PROPERTY, PLANT AND EQUIPMENT 6 7,399,366 7,019,817 RESTRICTED CASH 7 2,037,677 1,839,216 EQUITY-ACCOUNTED INVESTMENT 8 13,324,548 11,515,327 OTHER NON-CURRENT ASSETS 648,895 769,875 TOTAL ASSETS $ 163,575,373 $ 91,389,617 CURRENT LIABILITIES Accounts payable and accrued liabilities $ 2,104,028 $ 1,858,499 Due to a related party 9 - 31,334 Other current liabilities 13 87,129 147,569 Current portion of other loans payable 11 189,143 - Current portion of long-term debt 10 9,821,573 - TOTAL CURRENT LIABILITIES 12,201,873 2,037,402 LONG-TERM DEBT 10 - 19,869,477 OTHER LOANS PAYABLE 11 114,737 307,092 ASSET RETIREMENT OBLIGATIONS 12 3,887,569 3,734,314 OTHER NON-CURRENT LIABILITIES 13 488,691 479,714 DEFERRED TAX LIABILITIES 542,206 545,000 TOTAL LIABILITIES 17,235,076 26,972,999 STOCKHOLDERS' EQUITY Capital stock Common stock $0.001 par value: 750,000,000 shares authorized, 232,365,705 shares issued and outstanding (July 31, 2020 - 184,635,870) 14 232,365 184,636 Additional paid-in capital 434,908,779 341,059,972 Share issuance obligation 103,554 103,554 Accumulated deficit (289,826,057 ) (276,811,300 ) Accumulated other comprehensive income (loss) 921,656 (120,244 ) TOTAL EQUITY 146,340,297 64,416,618 TOTAL LIABILITIES AND EQUITY $ 163,575,373 $ 91,389,617 SUBSEQUENT EVENTS 4,8,14 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited – Expressed in U.S. Dollars) Three Months Ended April 30, Nine Months Ended April 30, Note(s) 2021 2020 2021 2020 COSTS AND EXPENSES Mineral property expenditures 5 $ 1,478,754 $ 956,564 $ 3,141,772 $ 3,803,338 General and administrative 9,14 3,286,201 2,127,887 8,336,593 6,837,851 Depreciation, amortization and accretion 5,6,12 98,186 74,060 294,964 232,198 LOSS FROM OPERATIONS (4,863,141 ) (3,158,511 ) (11,773,329 ) (10,873,387 ) OTHER INCOME (EXPENSES) Interest income 15,950 30,403 30,313 171,925 Interest expenses and finance costs 10 (636,178 ) (835,683 ) (2,356,819 ) (2,579,971 ) Income from equity-accounted investment 8 870,013 684,443 767,321 3,048,219 Gain on loan extinguishment 11 7,759 - 286,376 - Other income 16,632 4,475 30,720 21,693 (Loss) gain on disposition of assets (2,133 ) 216 (2,133 ) 2,016 OTHER INCOME (EXPENSES) 272,043 (116,146 ) (1,244,222 ) 663,882 LOSS BEFORE INCOME TAXES (4,591,098 ) (3,274,657 ) (13,017,551 ) (10,209,505 ) DEFERRED TAX BENEFITS 937 1,013 2,794 4,623 NET LOSS FOR THE PERIOD (4,590,161 ) (3,273,644 ) (13,014,757 ) (10,204,882 ) OTHER COMPREHENSIVE INCOME (LOSS), NET OF INCOME TAXES 8 493,101 (479,148 ) 1,041,900 (528,690 ) TOTAL COMPREHENSIVE LOSS FOR THE PERIOD $ (4,097,060 ) $ (3,752,792 ) $ (11,972,857 ) $ (10,733,572 ) NET LOSS PER SHARE, BASIC AND DILUTED 15 $ (0.02 ) $ (0.02 ) $ (0.06 ) $ (0.06 ) WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED 218,822,085 183,896,944 202,304,157 182,637,673 The accompanying notes are an integral part of these condensed consolidated financial statements. 6 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited – Expressed in U.S. Dollars) Nine Months Ended April 30, Note(s) 2021 2020 NET CASH PROVIDED BY (USED IN): OPERATING ACTIVITIES Net loss for the period $ (13,014,757 ) $ (10,204,882 ) Adjustments to reconcile net loss to cash flows in operating activities Stock-based compensation 14 3,764,300 2,411,281 Depreciation, amortization and accretion 5,6,12 294,964 232,198 Amortization of long-term debt discount 10 1,122,096 1,244,032 Loss (gain) on disposition of assets 2,133 (2,016 ) Gain on loan extinguishment 11 (286,376 ) - Income from equity-accounted investment 8 (767,321 ) (3,048,219 ) Deferred tax benefits (2,794 ) (4,623 ) Changes in operating assets and liabilities Inventories (26,193,818 ) - Prepaid expenses and deposits (402,017 ) 248,845 Other current assets (13,903 ) 130,877 Accounts payable and accrued liabilities 256,028 (1,222,616 ) Due to a related party 9 (31,334 ) (52,505 ) Other liabilities 22,591 (65,028 ) NET CASH USED IN OPERATING ACTIVITIES (35,250,208 ) (10,332,656 ) FINANCING ACTIVITIES Proceeds from share issuances, net of issuance costs 14 88,551,751 - Repayments of long-term debt 10 (10,000,000 ) - Repayments of other loans 11 (98,203 ) - Proceeds from a government loan - 28,756 NET CASH PROVIDED BY FINANCING ACTIVITIES 78,453,548 28,756 INVESTING ACTIVITIES Investment in mineral rights and properties (80,000 ) (80,000 ) Purchase of property, plant and equipment 6 (142,266 ) (83,841 ) Investment in term deposits (10,000,000 ) - Proceeds from redemption of term deposits 6,000,000 11,831,671 Proceeds from disposition of assets - 2,800 NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES (4,222,266 ) 11,670,630 NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 38,981,074 1,366,730 CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD 6,986,919 7,879,578 CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD 7 $ 45,967,993 $ 9,246,308 The accompanying notes are an integral part of these condensed consolidated financial statements. 7 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS ’ EQUITY (Unaudited – Expressed in U.S. Dollars) Accumulated Other Common Stock Additional Paid-in Share Issuance Accumulated Comprehensive Income Stockholders' Shares Amount Capital Obligation Deficit (Loss) Equity Balance, July 31, 2020 184,635,870 $ 184,636 $ 341,059,972 $ 103,554 $ (276,811,300 ) $ (120,244 ) $ 64,416,618 Common stock Issued for equity financing, net of issuance costs 12,500,000 12,500 12,455,787 - - - 12,468,287 Issued upon exercise of stock options 13,532 15 9,294 - - - 9,309 Stock-based compensation Common stock issued under Stock Incentive Plan 227,390 226 235,043 30,321 - - 265,590 Amortization of stock-based compensation - - 1,046,175 - - - 1,046,175 Warrants Issued for equity financing - - 1,518,432 - - - 1,518,432 Issued for equity financing as issuance costs - - 134,937 - - - 134,937 Net loss for the period - - - - (4,963,537 ) - (4,963,537 ) Other comprehensive income - - - - - 62,761 62,761 Balance, October 31, 2020 197,376,792 197,377 356,459,640 133,875 (281,774,837 ) (57,483 ) 74,958,572 Common stock Issued under ATM offering, net of issuance costs 632,487 632 1,073,705 - - - 1,074,337 Issued as anniversary fees for credit facility 1,249,039 1,249 1,168,751 - - - 1,170,000 Issued upon exercise of stock options 559,528 559 211,566 - - - 212,125 Issued upon exercise of warrants 1,050 1 1,889 - - - 1,890 Stock-based compensation Common stock issued for consulting services - - - 40,009 - - 40,009 Common stock issued under Stock Incentive Plan 323,660 324 358,359 (30,321 ) - - 328,362 Amortization of stock-based compensation - - 836,569 - - - 836,569 Net loss for the period - - - - (3,461,059 ) - (3,461,059 ) Other comprehensive income - - - - - 486,038 486,038 Balance, January 31, 2021 200,142,556 200,142 360,110,479 143,563 (285,235,896 ) 428,555 75,646,843 Common stock Issued under ATM offering, net of issuance costs 13,036,419 13,036 28,058,564 - - - 28,071,600 Issued under direct offerings, net of issuance costs 13,636,364 13,636 40,059,512 - - - 40,073,148 Issued upon exercise of stock options 1,511,547 1,512 1,085,332 - - - 1,086,844 Issued upon exercise of warrants 3,598,200 3,598 3,395,705 - - - 3,399,303 Stock-based compensation Common stock issued for consulting services 291,005 291 890,482 (40,009 ) - - 850,764 Common stock issued under Stock Incentive Plan 149,614 150 307,981 - - - 308,131 Amortization of stock-based compensation - - 674,196 - - - 674,196 Warrants Issued for equity financing as issuance costs - - 326,528 - - - 326,528 Net loss for the period - - - - (4,590,161 ) - (4,590,161 ) Other comprehensive income - - - - - 493,101 493,101 Balance, April 30, 2021 232,365,705 $ 232,365 $ 434,908,779 $ 103,554 $ (289,826,057 ) $ 921,656 $ 146,340,297 The accompanying notes are an integral part of these condensed consolidated financial statements. 8 URANIUM ENERGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS ’ EQUITY (Unaudited – Expressed in U.S. Dollars) Accumulated Other Common Stock Additional Paid-in Share Issuance Accumulated Comprehensive Income Stockholders' Shares Amount Capital Obligation Deficit (Loss) Equity Balance, July 31, 2019 180,896,431 $ 180,896 $ 336,047,595 $ 187,100 $ (262,200,784 ) $ 12,461 $ 74,227,268 Stock-based compensation Common stock issued for consulting services 29,167 29 31,763 - - - 31,792 Common stock issued under Stock Incentive Plan 435,348 436 410,026 (187,100 ) - - 223,362 Amortization of stock-based compensation - - 662,232 - - - 662,232 Net loss for the period - - - - (5,042,577 ) - (5,042,577 ) Other comprehensive loss - - - - - (9,894 ) (9,894 ) Balance, October 31, 2019 181,360,946 181,361 337,151,616 - (267,243,361 ) 2,567 70,092,183 Common stock Issued as anniversary fees for credit facility 1,743,462 1,743 1,398,257 - - - 1,400,000 Stock-based compensation Common stock issued for consulting services 313,201 313 277,644 - - - 277,957 Common stock issued under Stock Incentive Plan 256,206 257 234,535 - - - 234,792 Amortization of stock-based compensation - - 485,268 - - - 485,268 Warrants Issued for consulting services - - 22,733 - - - 22,733 Net loss for the period - - - - (1,888,661 ) - (1,888,661 ) Other comprehensive loss - - - - - (39,648 ) (39,648 ) Balance, January 31, 2020 183,673,815 183,674 339,570,053 - (269,132,022 ) (37,081 ) 70,584,624 Stock-based compensation Common stock issued under Stock Incentive Plan 376,298 376 246,826 - - - 247,202 Amortization of stock-based compensation - - 381,694 - - - 381,694 Net loss for the period - - - - (3,273,644 ) - (3,273,644 ) Other comprehensive loss - - - - - (479,148 ) (479,148 ) Balance, April 30, 2020 184,050,113 $ 184,050 $ 340,198,573 $ - $ (272,405,666 ) $ (516,229 ) $ 67,460,728 The accompanying notes are an integral part of these condensed consolidated financial statements. 9 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) NOTE 1: NATURE OF OPERATIONS Uranium Energy Corp. was incorporated in the State of Nevada on May 16, 2003. Uranium Energy Corp. and its subsidiary companies and a controlled partnership (collectively, the “Company” or “we”) are engaged in uranium and titanium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates and titanium minerals, on projects located in the United States, Canada and the Republic of Paraguay. As at April 30, 2021, we had a working capital of $64.2 million including cash and cash equivalents of $43.9 million, term deposits of $4.0 million and uranium inventory holdings of $26.2 million. During the three months ended and subsequent to April 30, 2021, we entered into agreements to purchase 2.505 million pounds of uranium inventories for a total purchase price of $75.9 million, of which $18.1 million will become due in the next 12 months from the date that our condensed consolidated financial statements are issued (refer to Note 4: Inventories). In addition, as at April 30, 2021, we had $10.0 million of term debt with a maturity date of January 31, 2022. However, we believe our existing cash resources and if necessary, cash generated from the sale of the Company’s current assets will provide sufficient funds to fulfill our uranium inventory purchase commitments, repay the $10.0 million principal debt amount when it becomes due, and carry out our planned operations for 12 months from the date that our condensed consolidated financial statements are issued. Our continuation as a going concern for a period beyond those 12 months will be dependent upon our ability to obtain adequate additional financing, as our operations are capital intensive and future capital expenditures are expected to be substantial. Historically, we have been reliant primarily on equity financings from the sale of our common stock and on debt financing in order to fund our operations, and this reliance is expected to continue for the foreseeable future. Our continued operations, including the recoverability of the carrying values of our assets, are dependent ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations. NOTE 2: SUMMARY OF SIGNIFICANT POLICIES Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP”) for interim financial information and are presented in U.S. dollars. Accordingly, they do not include all of the information and footnotes required under U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended July 31, 2020 (“Fiscal 2020”). In the opinion of management, all adjustments of a normal recurring nature and considered necessary for a fair presentation have been made. Operating results for the nine months ended April 30, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ending July 31, 2021 (“Fiscal 2021”). Exploration Stage We have established the existence of mineralized materials for certain uranium projects, including for our Palangana Mine. We have not established proven or probable reserves, as defined by the United States Securities and Exchange Commission (the “SEC”) under Industry Guide 7 (“Industry Guide 7”), through the completion of a “final” or “bankable” feasibility study for any of our uranium projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing in-situ recovery (“ISR”) mining, such as the Palangana Mine. As a result, and despite the fact that we commenced extraction of mineralized materials at the Palangana Mine in November 2010, we remain in the Exploration Stage, as defined under Industry Guide 7, and will continue to remain in the Exploration Stage until such time that proven or probable reserves have been established. 10 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Since we commenced the extraction of mineralized materials at the Palangana Mine without having established proven or probable reserves, any mineralized materials established or extracted from the Palangana Mine should not in any way be associated with having established or produced from proven or probable reserves. In accordance with U.S. GAAP, expenditures relating to the acquisition of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time we exit the Exploration Stage by establishing proven or probable reserves. Expenditures relating to exploration activities such as drilling programs to establish mineralized materials are expensed as incurred. Expenditures relating to pre-extraction activities such as the construction of mine wellfields, ion exchange facilities and disposal wells are expensed as incurred until such time proven or probable reserves are established for that project, after which expenditures relating to mine development activities for that particular project are capitalized as incurred. Companies in the Production Stage, as defined under Industry Guide 7, having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. We are in the Exploration Stage which has resulted in us reporting larger losses than if we had been in the Production Stage due to the expensing, rather than capitalizing, of expenditures relating to ongoing mill and mine development activities. Additionally, there would be no corresponding amortization allocated to future reporting periods of our Company since those costs would have been expensed previously, resulting in both lower produced inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if we had been in the Production Stage. Any capitalized costs, such as expenditures relating to the acquisition of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage. NOTE 3: TERM DEPOSITS As of April 30, 2021, term deposits totaled $4,000,000 (July 31, 2020: $Nil), which are held at a major financial institution with an initial term of four to six months bearing interest rate at 0.25%. NOTE 4: INVENTORIES During the three months ended April 30, 2021, we entered into agreements to purchase 2,305,000 pounds of uranium inventories, of which 900,000 pounds of uranium inventory were received. As at April 30, 2021, costs of inventories consisted of the following: April 30, 2021 July 31, 2020 Supplies and work-in-progress $ 33,781 $ 33,781 Uranium concentrates from production 177,881 177,881 Purchased uranium inventories 26,193,818 - $ 26,405,480 $ 211,662 As of April 30, 2021, our uranium inventory purchase commitments for the next two fiscal years are as the follows: Purchase Commitments in Pounds Total Purchase Price Fiscal 2021 100,000 $ 2,745,000 Fiscal 2022 600,000 18,065,000 Fiscal 2023 705,000 22,674,000 Total 1,405,000 $ 43,484,000 11 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Subsequent to April 30, 2021, we received 100,000 pounds of uranium inventories at a purchase price of $2,745,000, and entered into agreements to purchase 200,000 pounds of uranium inventories. NOTE 5: MINERAL RIGHTS AND PROPERTIES Mineral Rights As of April 30, 2021, we had mineral rights in the States of Arizona, Colorado, New Mexico, Wyoming and Texas, in Canada and in the Republic of Paraguay. These mineral rights were acquired through staking, purchase or lease agreements and are subject to varying royalty interests, some of which are indexed to the sale price of uranium and titanium. As of April 30, 2021, annual maintenance payments of approximately $2.7 million will be required to maintain these mineral rights. Mineral rights and property acquisition costs consist of the following: April 30, 2021 July 31, 2020 Mineral Rights and Properties Palangana Mine $ 6,027,784 $ 6,027,784 Goliad Project 8,689,127 8,689,127 Burke Hollow Project 1,495,750 1,495,750 Longhorn Project 116,870 116,870 Salvo Project 14,905 14,905 Anderson Project 3,470,373 3,470,373 Workman Creek Project 849,854 799,854 Los Cuatros Project 257,250 257,250 Slick Rock Project 60,000 30,000 Reno Creek Project 31,527,870 31,527,870 Diabase Project 546,938 546,938 Yuty Project 11,947,144 11,947,144 Oviedo Project 1,133,412 1,133,412 Alto Paraná Titanium Project 1,433,030 1,433,030 Other Property Acquisitions 91,080 91,080 67,661,387 67,581,387 Accumulated Depletion (3,929,884 ) (3,929,884 ) 63,731,503 63,651,503 Databases and Land Use Agreements 2,458,808 2,458,808 Accumulated Amortization (2,455,933 ) (2,454,808 ) 2,875 4,000 $ 63,734,378 $ 63,655,503 We have not established proven or probable reserves, as defined by the SEC under Industry Guide 7, for any of our mineral projects. We have established the existence of mineralized materials for certain mineral projects, including our Palangana Mine. Since we commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated. During the three and nine months ended April 30, 2021 and 2020, we continued with reduced operations at the Palangana Mine to capture residual uranium only. As a result, no depletion for the Palangana Mine was recorded on our condensed consolidated financial statements for the three and nine months ended April 30, 2021 and 2020. 12 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Mineral property expenditures incurred on our projects were as follows: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Mineral Property Expenditures Palangana Mine $ 216,791 $ 260,438 $ 648,459 $ 1,109,164 Goliad Project 51,437 54,486 168,493 151,293 Burke Hollow Project 626,695 154,672 942,311 1,024,345 Longhorn Project 2,289 2,289 6,866 14,735 Salvo Project 7,672 7,843 23,537 21,813 Anderson Project 19,469 19,519 58,360 49,004 Workman Creek Project 8,168 8,168 24,533 24,533 Slick Rock Project 12,994 13,123 39,123 39,527 Reno Creek Project 215,725 159,088 485,791 451,312 Yuty Project 7,129 27,664 21,457 58,578 Oviedo Project 109,676 69,446 256,091 298,505 Alto Paraná Titanium Project 88,796 36,323 134,710 202,656 Other Mineral Property Expenditures 111,913 143,505 332,041 357,873 $ 1,478,754 $ 956,564 $ 3,141,772 $ 3,803,338 NOTE 6: PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: April 30, 2021 July 31, 2020 Cost Accumulated Depreciation Net Book Value Cost Accumulated Depreciation Net Book Value Hobson Processing Facility $ 6,642,835 $ (831,789 ) $ 5,811,046 $ 6,642,835 $ (773,933 ) $ 5,868,902 Mining Equipment 2,355,379 (2,314,364 ) 41,015 2,393,579 (2,342,518 ) 51,061 Logging Equipment and Vehicles 1,923,983 (1,761,956 ) 162,027 1,924,969 (1,736,806 ) 188,163 Computer Equipment 333,318 (285,517 ) 47,801 550,243 (486,467 ) 63,776 Furniture and Fixtures 184,941 (171,462 ) 13,479 170,701 (169,946 ) 755 Land and Buildings 1,377,601 (53,603 ) 1,323,998 889,606 (42,446 ) 847,160 $ 12,818,057 $ (5,418,691 ) $ 7,399,366 $ 12,571,933 $ (5,552,116 ) $ 7,019,817 During the nine months ended April 30, 2021, we purchased 100 acres of land (the “Goliad Land Purchase”) within our Goliad Project located in Goliad County, Texas, for total consideration of $487,995, of which $380,000 was financed with a promissory note. Refer to Note 11: Other Loans Payable herein. NOTE 7: RESTRICTED CASH Restricted cash includes cash and cash equivalents and money market funds pledged as collateral for various bonds posted in favor of applicable state regulatory agencies in Arizona, Texas and Wyoming, and for estimated reclamation costs associated with our Anderson Project, Palangana Mine, Hobson Processing Facility and Reno Creek Project. Restricted cash will be released upon the completion of reclamation of a mineral property or the restructuring of a surety and collateral arrangement. 13 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) During the three months ended April 30, 2021, we paid an additional $198,377 as surety bond collateral for inflation adjustments upon renewal of various surety bonds relating to our Palangana Mine and Hobson Processing Facility. April 30, 2021 July 31, 2020 Restricted cash, beginning of period $ 1,839,216 $ 1,821,392 Additional surety bond collateral 198,377 - Interest received 84 17,824 Restricted cash, end of period $ 2,037,677 $ 1,839,216 Cash, cash equivalents and restricted cash are included in the following accounts as of April 30, 2021 and 2020: April 30, 2021 April 30, 2020 Cash and cash equivalents $ 43,930,316 $ 7,407,189 Restricted cash 2,037,677 1,839,119 Total cash, cash equivalents and restricted cash $ 45,967,993 $ 9,246,308 NOTE 8: EQUITY-ACCOUNTED INVESTMENT As of April 30, 2021, we owned 14,000,000 shares of Uranium Royalty Corp. (“URC”), representing a 18.8% (July 31, 2020: 19.5%) interest in URC. In addition, two of our officers are members of URC’s board of directors, and one of which is also an executive officer of URC. As a consequence, our ability to exercise significant influence over URC’s operating and financing policies continued to exist during the three and nine months ended April 30, 2021. URC is a public company listed on the TSX Venture Exchange with the trading symbol “URC.V” and on NASDAQ with the trading symbol “UROY”. For the three and nine months ended April 30, 2021 and 2020, income (loss) from investment in URC consisted of the following: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Share of income (loss) from URC $ 456,132 $ 684,443 $ 353,440 $ (8,437 ) Gain on ownership interest dilution 413,881 - 413,881 3,056,656 Total $ 870,013 $ 684,443 $ 767,321 $ 3,048,219 For the three and nine months ended April 30, 2021 and 2020, we recorded a gain on ownership interest dilution as a result of URC issuing more shares from the exercises of URC’s share purchase warrants. For the three and nine months ended April 30, 2021, we recorded translation gains of $493,101 and $1,041,900, respectively, and for three and nine months ended April 30, 2020, we recorded translation losses of $479,148 and $528,690, respectively, as a result of translating the ending balance of the investment in URC denominated in Canadian Dollars to U.S. Dollars using the period end exchange rate, which was included in other comprehensive income (loss) in our condensed consolidated statements of operations and comprehensive loss. During the nine months ended April 30, 2021, the change in carrying value of our investment in URC is summarized as follows: Balance, July 31, 2020 $ 11,515,327 Income from investment in URC 353,440 Gain on ownership interest dilution 413,881 Translation gain 1,041,900 Balance, April 30, 2021 $ 13,324,548 As of April 30, 2021, the fair value of our investment in URC was approximately $49.3 million. 14 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Subsequent to April 30, 2021, on May 20, 2021, we participated in an equity financing and acquired an additional 1,000,000 common shares of URC at a price of CAD$4.10 per share for total consideration of $3,396,852. NOTE 9: RELATED PARTY TRANSACTIONS During the three and nine months ended April 30, 2021, we incurred $17,900 and $52,041 (three and nine months ended April 30, 2020: $36,849 and $105,339), respectively, in general and administrative costs paid to Blender Media Inc. (“Blender”), a company controlled by Arash Adnani, a direct family member of our President and Chief Executive Officer, for various services, including information technology, financial subscriptions, corporate branding, media, website design, maintenance and hosting, provided by Blender to the Company. As of April 30, 2021, the amount owing to Blender was $nil (July 31, 2020: $31,334). NOTE 10: LONG-TERM DEBT As of April 30, 2021, our long-term debt consisted of the following: April 30, 2021 July 31, 2020 Principal amount $ 10,000,000 $ 20,000,000 Unamortized discount and accrued fees (178,427 ) (130,523 ) Long-term debt, net of unamortized discount $ 9,821,573 $ 19,869,477 Current portion 9,821,573 - Long-term debt, net of current portion $ - $ 19,869,477 For the three and nine months ended April 30, 2021, amortization of debt discount totaled $296,401 and $1,122,096 (three and nine months ended April 30, 2020: $399,231 and $1,244,032), respectively, which was recorded as interest expense and included in our condensed consolidated statements of operations and comprehensive loss. During the three and nine months ended April 30, 2021, we paid $274,222 and $1,051,111 (three and nine months ended April 30, 2020: $400,000 and $1,217,778), respectively, in cash to our lenders (the “Lenders”) for interest on the long-term debt. During the nine months ended April 30, 2021, we made voluntary principal payments totaling $10,000,000 to certain Lenders, which decreased the principal balance outstanding to $10,000,000 under our credit facility (the “Credit Facility”). During the nine months ended April 30, 2021, and pursuant to the terms of our Third Amended and Restated Credit Agreement with our Lenders, we issued an aggregate of 1,249,039 shares with a fair value of $1,170,000, representing 6.5% of the $18,000,000 principal balance outstanding at the time, as payment of anniversary fees to our Lenders. The Company’s Credit Facility with our remaining Lender has a maturity date on January 31, 2022, with an interest rate of 8% per annum and an underlying effective interest rate of 18.10%. As of April 30, 2021, our working capital ratio, excluding the current portion of the long-term debt, was 32:1, which was in compliance with the debt covenant requirement under our Credit Facility being a working capital ratio, excluding any current portion of the long-term debt, of not less than 1:1. The aggregate yearly maturities of long-term debt based on principal amounts outstanding as at April 30, 2021 are as follows: Fiscal 2021 $ - Fiscal 2022 10,000,000 Total $ 10,000,000 15 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) NOTE 11: OTHER LOANS PAYABLE During Fiscal 2020, we applied for a Paycheck Protection Program loan and received the proceeds of $277,250 (the “PPP Loan”). During the nine months ended April 30, 2021, we received a Notice of Paycheck Protection Program Forgiveness Payment from the Small Business Administration regarding the approval of our application for forgiveness of our PPP Loan of $277,250 and accrued interest. As a result, we recognized a gain on extinguishment of the PPP Loan of $278,617 during the nine months ended April 30, 2021. During Fiscal 2020, our Canadian subsidiary received a loan of $29,842 (CAD$40,000) under the Canadian Emergency Business Account Program (“CEBA”), which provides financial relief for Canadian small businesses during the COVID-19 pandemic (the “CEBA Loan”). During the three months ended April 30, 2021, we repaid CAD$30,000 of the CEBA Loan, 75% of the total CEBA Loan principal before its initial term date on December 31, 2022 and received a CEBA Loan Closure Confirmation for forgiveness of CAD$10,000. As a result, we recognized a gain on extinguishment of the CEBA Loan of $7,759 during the three months ended April 30, 2021. During the nine months ended April 30, 2021, in connection with the Goliad Land Purchase, we issued a promissory note with a principal amount of $380,000 to a landowner (the “Promissory Note”). The Promissory Note carries an interest rate of 5% per annum with principal and interest payable in 24 monthly installments with a maturity date of November 1, 2022. We may prepay the Promissory Note in any amount at any time before the maturity date without penalty. During the three and nine months ended April 30, 2021, we paid $4,124 and $7,235, respectively, in cash for interest on the Promissory Note. As of April 30, 2021, other loans payable consisted of the following: April 30, 2021 July 31, 2020 Government loan payable $ - $ 307,092 Promissory note payable 303,880 - $ 303,880 $ 307,092 Current portion Government loan payable $ - $ - Promissory note payable 189,143 - $ 189,143 $ - Non-current portion Government loan payable $ - $ 307,092 Promissory note payable 114,737 - $ 114,737 $ 307,092 NOTE 12: ASSET RETIREMENT OBLIGATIONS Asset retirement obligations (“ARO”s) relate to future remediation and decommissioning activities at our Palangana Mine, Hobson Processing Facility, Reno Creek Project and Alto Paraná Titanium Project. Balance, July 31, 2020 $ 3,734,314 Accretion 153,255 Balance, April 30, 2021 $ 3,887,569 16 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) The estimated amounts and timing of cash flows and assumptions used for ARO estimates are as follows: April 30, 2021 July 31, 2020 Undiscounted amount of estimated cash flows $ 8,221,018 $ 8,221,018 Payable in years 9 to 21 9 to 21 Inflation rate 1.56% to 2.17% 1.56% to 2.17% Discount rate 5.50% to 5.96% 5.50% to 5.96% The undiscounted amounts of estimated cash flows for the next five fiscal years and beyond are as follows: Fiscal 2022 $ - Fiscal 2023 - Fiscal 2024 - Fiscal 2025 - Fiscal 2026 - Remaining balance 8,221,018 $ 8,221,018 NOTE 13: LEASE LIABILITIES The Company primarily has operating leases for corporate offices and a processing facility with a remaining term of 0.3 to 18.1 years. The lease for the processing facility has an evergreen option that can continue for so long as it is in operation. During the three and nine months ended April 30, 2021 and 2020, total lease expenses include the following components: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Operating leases $ 56,195 $ 63,073 $ 163,028 $ 182,012 Short-term leases 365,027 23,289 407,982 420,318 Total Lease Expenses $ 421,222 $ 86,362 $ 571,010 $ 602,330 As at April 30, 2021, the weighted average remaining lease term was 16.1 years and the weighted average discount rate was 4.74%. During the nine months ended April 30, 2021, cash paid for amounts included in the measurement of operating lease liabilities totaled $170,276. 17 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Minimum future lease payments under operating leases with terms longer than one year are as follows: Fiscal 2021 $ 68,956 Fiscal 2022 249,829 Fiscal 2023 20,000 Fiscal 2024 20,000 Fiscal 2025 20,000 Thereafter 300,000 Total lease payments 678,785 Less: imputed interest (146,670 ) Present value of lease liabilities $ 532,115 Current portion of lease liabilities $ 78,050 Non-current portion of lease liabilities $ 454,065 Current lease liabilities are included in Other Current Liabilities, and non-current lease liabilities are included in Other Non-Current Liabilities in our consolidated balance sheets. NOTE 14: CAPITAL STOCK Equity Financing On September 23, 2020, we completed a public offering of 12,500,000 units at a price of $1.20 per unit for gross proceeds of $15,000,000 (the “September 2020 Offering”). Each unit consisted of one share of our Company and one-half of one share purchase warrant, and each whole warrant entitles its holder to acquire one share of our Company at an exercise price of $1.80 per share and expiring 24 months from the date of issuance. In connection with the September 2020 Offering, we also issued compensation share purchase warrants to agents as part of share issuance costs to purchase 583,333 shares of our Company exercisable at an exercise price of $1.80 per share and expiring 24 months from the date of issuance. The shares were valued at the Company’s closing price of $0.96 per share on September 23, 2020. The share purchase warrants were valued using the Black-Scholes option pricing model with the following assumptions. Expected Risk Free Interest Rate 0.14 % Expected Annual Volatility 76.81 % Expected Contractual Life in Years 2.00 Expected Annual Dividend Yield 0.00 % 18 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) The net proceeds from the September 2020 Offering were allocated to the fair values of the shares and share purchase warrants as presented below. Fair Value of Shares $ 12,000,000 Fair Value of Share Purchase Warrants 1,445,756 Total Fair Value Before Allocation to Net Proceeds $ 13,445,756 Gross Proceeds $ 15,000,000 Share Issuance Costs - Cash (878,344 ) Net Cash Proceeds Received $ 14,121,656 Relative Fair Value Allocation to: Shares $ 12,603,224 Share Purchase Warrants 1,518,432 $ 14,121,656 During Fiscal 2019, we entered into an At The Market Offering Agreement (the “ATM Offering Agreement”) with H.C. Wainwright & Co., LLC and certain co-managers as set forth in the ATM Offering Agreement (collectively, the “ATM Managers”), as amended in Fiscal 2020, under which the Company may, from time to time, sell shares of its common stock having an aggregate offering price of up to $30 million through the ATM Managers (collectively, the “ATM Offering”). During the nine months ended April 30, 2021, we issued 13,668,906 shares of the Company’s common stock at a weighted average price of $2.19 per share under the ATM Offering for net cash proceeds of $29,320,949. On March 19, 2021, we completed a registered direct offering of 10,000,000 shares of the Company’s common stock at a price of $3.05 per share for net proceeds of $29,083,710 (the “March 2021 Offering”). On April 8, 2021, we completed a registered direct offering of 3,636,364 shares of the Company’s common stock at a price of $3.30 per share for net proceeds of $11,315,966 (the “April 2021 Offering”). In connection with the April 2021 Offering, we also issued, on a private placement basis, 181,818 common stock purchase warrants (each, an “Agent Warrant”) to the agent as partial compensation, and each Agent Warrant entitles its holder to acquire one share of common stock at an exercise price of $4.125 per share and expiring five years from the date of issuance. The Agent Warrants were valued at $1.80 per share using the Black-Scholes option pricing model with the following assumptions. Expected Risk Free Interest Rate 0.85 % Expected Annual Volatility 72.17 % Expected Contractual Life in Years 5.00 Expected Annual Dividend Yield 0.00 % 19 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Share Purchase Warrants A continuity schedule of outstanding share purchase warrants for the nine months ended April 30, 2021, is as follows: Number of Warrants Weighted Average Exercise Price Balance, July 31, 2020 7,721,981 $ 2.03 Issued in connection with September 2020 Offering 6,833,333 1.80 Balance, October 31, 2020 14,555,314 1.92 Exercised (1,050 ) 1.80 Expired (300,000 ) 1.38 Balance, January 31, 2021 14,254,264 1.93 Issued in connection with April 2021 Offering 181,818 4.13 Exercised (8,145,840 ) 1.99 Expired (809,304 ) 2.05 Balance, April 30, 2021 5,480,938 $ 1.90 During the three and nine months ended April 30, 2021, we received cash proceeds of $3,399,303 and $3,401,193, and issued 3,598,200 and 3,599,250 shares, respectively, from the exercise of 8,145,840 and 8,146,890 share purchase warrants, respectively. A summary of share purchase warrants outstanding and exercisable as of April 30, 2021, is as follows: Weighted Average Exercise Price Number of Warrants Outstanding Weighted Average Remaining Contractual Life (Years) Expiry Date $ 2.30 308,728 1.28 August 9, 2022 1.64 25,000 2.06 May 21, 2023 1.80 4,965,392 1.40 September 23, 2022 4.13 181,818 4.93 April 5, 2026 $ 1.90 5,480,938 1.51 Stock Options As of April 30, 2021, we had one stock option plan, our 2020 Stock Incentive Plan, which superseded and replaced our 2019 Stock Incentive Plan. A continuity schedule of outstanding stock options for the underlying shares for the nine months ended April 30, 2021, is as follows: Number of Stock Options Weighted Average Exercise Price Balance, July 31, 2020 15,514,750 $ 1.13 Exercised (28,500 ) 0.93 Expired (1,315,000 ) 1.43 Balance, October 31, 2020 14,171,250 1.10 Exercised (1,100,782 ) 1.11 Balance, January 31, 2021 13,070,468 1.10 Granted 42,490 2.26 Exercised (1,942,848 ) 1.11 Balance, April 30, 2021 11,170,110 $ 1.11 20 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) During the three and nine months ended April 30, 2021 and 2020, the total number of stock options exercised, the number of shares issued upon exercise of those options and the cash received from such exercises are as follows: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Number of Options Exercised on Forfeiture Basis 988,909 - 1,930,691 - Number of Options Exercised on Cash Basis 953,939 - 1,141,439 - Total Number of Options Exercised 1,942,848 - 3,072,130 - Number of Shares Issued on Cash Exercise 953,939 - 1,141,439 - Number of Shares Issued on Forfeiture Basis 557,608 - 943,168 - Total Number of Shares Issued Upon Exercise of Options 1,511,547 - 2,084,607 - Cash Received from Exercise of Stock Options $ 1,086,844 $ - $ 1,308,278 $ - Total Intrinsic Value of Options Exercised $ 3,026,602 $ - $ 3,855,217 $ - Subsequent to April 30, 2021, we received further cash proceeds of $380,776 and issued 704,423 shares of the Company upon the exercise of 888,251 stock options. A continuity schedule of outstanding unvested stock options as of April 30, 2021, and the changes during the period, is as follows: Number of Unvested Stock Options Weighted Average Grant-Date Fair Value Balance, July 31, 2020 6,797,471 $ 0.46 Vested (718,755 ) 0.46 Balance, October 31, 2020 6,078,716 0.46 Vested (1,042,559 ) 0.48 Balance, January 31, 2021 5,036,157 0.45 Granted 42,490 1.29 Vested (229,229 ) 0.46 Balance, April 30, 2021 4,849,418 $ 0.46 As of April 30, 2021, unrecognized stock-based compensation expense related to the unvested portion of stock options totaled $922,396 to be recognized over the next 1.06 years. As of April 30, 2021, the aggregate intrinsic value under the provisions of ASC 718 of all outstanding stock options was $20,034,091 (vested: $10,709,934 and unvested: $9,324,157). A summary of stock options outstanding and exercisable as of April 30, 2021, is as follows: Options Outstanding Options Exercisable Range of Exercise Prices Outstanding at April 30, 2021 Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Exercisable at April 30, 2021 Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) $ 0.80 to $ 0.99 6,577,995 $ 0.92 7.73 3,108,567 $ 0.92 6.28 $ 1.00 to $ 1.49 2,752,625 1.17 5.13 1,415,125 1.25 1.33 $ 1.50 to $ 2.81 1,839,490 1.68 2.21 1,797,000 1.66 2.03 11,170,110 $ 1.11 6.18 6,320,692 $ 1.20 3.96 21 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) Restricted Stock Units A summary of outstanding and unvested restricted stock units (“RSU”s) as of April 30, 2021, is as follows: Grant Date Number of Restricted Stock Units Grant Date Fair Value Remaining Life (Years) Aggregate Intrinsic Value July 30, 2019 310,000 $ 0.94 1.25 $ 899,000 July 16, 2020 1,305,000 0.91 2.21 3,784,500 1,615,000 $ 0.92 2.03 $ 4,683,500 During the three and nine months ended April 30, 2021, stock-based compensation relating to RSUs totaled $262,970 and $806,638 (three and nine months ended April 30, 2020: $66,928 and $200,784), respectively. As of April 30, 2021, outstanding unvested RSUs totaled 1,615,000 (July 31, 2020: 1,615,000), and unrecognized compensation costs relating to unvested RSUs totaled $508,861, which is expected to be recognized over a period of approximately 1.14 years. Performance Based Restricted Stock Units During the three and nine months ended April 30, 2021, stock-based compensation relating to target performance based restricted stock units (“PRSU”s) totaled $37,544 and $112,632 (three and nine months ended April 30, 2020: $68,165 and $204,495), respectively. As of April 30, 2021, outstanding unvested PRSUs totaled 333,750 (July 31, 2020: 333,750), and unrecognized compensation costs relating to unvested PRSUs totaled $126,720, which is expected to be recognized over a period of approximately 0.72 years. Stock-Based Compensation A summary of stock-based compensation expense is as follows: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Stock-Based Compensation for Consultants Common stock issued to consultants $ 229,047 $ 131,516 $ 468,364 $ 365,274 Amortization of stock option expenses 54,593 57,130 224,295 157,655 283,640 188,646 692,659 522,929 Stock-Based Compensation for Management Common stock issued to management - 24,308 - 93,115 Amortization of stock option expenses 154,531 100,317 614,579 506,422 Amortization of RSU & PRSU expenses 300,514 135,093 919,270 405,279 455,045 259,718 1,533,849 1,004,816 Stock-Based Compensation for Employees Common stock issued to employees 264,484 158,127 738,996 416,152 Amortization of stock option expenses 164,558 89,154 798,796 482,573 429,042 247,281 1,537,792 898,725 Settlement of share issuance obligation - - - (15,189 ) $ 1,167,727 $ 695,645 $ 3,764,300 $ 2,411,281 22 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) NOTE 15: LOSS PER SHARE The following table reconciles the weighted average number of shares used in the calculation of the basic and diluted loss per share: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Numerator Net Loss for the Period $ (4,590,161 ) $ (3,273,644 ) $ (13,014,757 ) $ (10,204,882 ) Denominator Basic Weighted Average Number of Shares 218,822,085 183,896,944 202,304,157 182,637,673 Dilutive Stock Options, RSUs, PRSUs and Warrants - - - - Diluted Weighted Average Number of Shares 218,822,085 183,896,944 202,304,157 182,637,673 Net Loss per Share, Basic and Diluted $ (0.02 ) $ (0.02 ) $ (0.06 ) $ (0.06 ) For the three and nine months ended April 30, 2021 and 2020, all outstanding stock options, RSUs, PRSUs and share purchase warrants were excluded from the calculation of the diluted loss per share since their effects would be anti-dilutive. NOTE 16: SEGMENTED INFORMATION We currently operate in one reportable segment which is focused on uranium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates. As of April 30, 2021, our long-term assets located in the United States totaled $58,294,295 or 67% of our total long-term assets of $87,144,864. The table below provides a breakdown of the long-term assets by geographic segments: April 30, 2021 United States Balance Sheet Items Texas Arizona Wyoming Other States Canada Paraguay Total Mineral Rights and Properties $ 12,421,536 $ 4,577,477 $ 31,527,870 $ 146,971 $ 546,938 $ 14,513,586 $ 63,734,378 Property, Plant and Equipment 6,682,983 - 316,482 - 37,768 362,133 7,399,366 Restricted Cash 1,948,704 15,000 73,973 - - - 2,037,677 Equity-Accounted Investment - - - - 13,324,548 - 13,324,548 Other Non-Current Assets 565,799 - 17,500 - 65,596 - 648,895 Total Long-Term Assets $ 21,619,022 $ 4,592,477 $ 31,935,825 $ 146,971 $ 13,974,850 $ 14,875,719 $ 87,144,864 July 31, 2020 United States Balance Sheet Items Texas Arizona Wyoming Other States Canada Paraguay Total Mineral Rights and Properties $ 12,422,661 $ 4,527,477 $ 31,527,870 $ 116,971 $ 546,938 $ 14,513,586 $ 63,655,503 Property, Plant and Equipment 6,299,786 - 327,639 - 29,677 362,715 7,019,817 Restricted Cash 1,750,243 15,000 73,973 - - - 1,839,216 Equity-Accounted Investment - - - - 11,515,327 - 11,515,327 Other Non-Current Assets 703,312 - 22,000 - 44,563 - 769,875 Total Long-Term Assets $ 21,176,002 $ 4,542,477 $ 31,951,482 $ 116,971 $ 12,136,505 $ 14,876,301 $ 84,799,738 23 URANIUM ENERGY CORP. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS April 30, 2021 (Unaudited – Expressed in U.S. Dollars) The tables below provide a breakdown of our operating results by geographic segments for the three and nine months ended April 30, 2021 and 2020. All intercompany transactions have been eliminated. Three Months ended April 30, 2021 Statement of Operations United States Texas Arizona Wyoming Other States Canada Paraguay Total Costs and Expenses: Mineral property expenditures $ 1,010,005 $ 30,996 $ 215,725 $ 16,335 $ 92 $ 205,601 $ 1,478,754 General and administrative 2,601,113 3,720 26,513 230 645,028 9,597 3,286,201 Depreciation, amortization and accretion 89,415 - 3,719 - 3,858 1,194 98,186 Loss from operations (3,700,533 ) (34,716 ) (245,957 ) (16,565 ) (648,978 ) (216,392 ) (4,863,141 ) Other income (expenses) (613,705 ) (4,611 ) (2,770 ) - 893,129 - 272,043 Loss before income taxes $ (4,314,238 ) $ (39,327 ) $ (248,727 ) $ (16,565 ) $ 244,151 $ (216,392 ) $ (4,591,098 ) Three Months Ended April 30, 2020 Statement of Operations United States Texas Arizona Wyoming Other States Canada Paraguay Total Costs and Expenses: Mineral property expenditures $ 619,892 $ 27,686 $ 159,087 $ 16,462 $ - $ 133,437 $ 956,564 General and administrative 1,513,764 3,389 22,358 345 587,015 1,016 2,127,887 Depreciation, amortization and accretion 65,809 - 3,720 249 2,497 1,785 74,060 Loss from operations (2,199,465 ) (31,075 ) (185,165 ) (17,056 ) (589,512 ) (136,238 ) (3,158,511 ) Other income (expenses) (826,432 ) (4,663 ) 995 - 713,467 487 (116,146 ) Loss before income taxes $ (3,025,897 ) $ (35,738 ) $ (184,170 ) $ (17,056 ) $ 123,955 $ (135,751 ) $ (3,274,657 ) Nine Months Ended April 30, 2021 Statement of Operations United States Texas Arizona Wyoming Other States Canada Paraguay Total Costs and Expenses: Mineral property expenditures $ 2,089,848 $ 93,472 $ 485,791 $ 52,740 $ 7,663 $ 412,258 $ 3,141,772 General and administrative 6,664,190 11,545 64,232 948 1,563,657 32,021 8,336,593 Depreciation, amortization and accretion 268,159 - 11,157 - 13,138 2,510 294,964 Loss from operations (9,022,197 ) (105,017 ) (561,180 ) (53,688 ) (1,584,458 ) (446,789 ) (11,773,329 ) Other income (expenses) (2,031,541 ) (14,146 ) (8,336 ) - 804,800 5,001 (1,244,222 ) Loss before income taxes $ (11,053,738 ) $ (119,163 ) $ (569,516 ) $ (53,688 ) $ (779,658 ) $ (441,788 ) $ (13,017,551 ) Nine Months Ended April 30, 2020 Statement of Operations United States Texas Arizona Wyoming Other States Canada Paraguay Total Costs and Expenses: Mineral property expenditures $ 2,665,242 $ 73,858 $ 451,312 $ 53,187 $ - $ 559,739 $ 3,803,338 General and administrative 4,927,762 10,217 77,549 1,407 1,775,036 45,880 6,837,851 Depreciation, amortization and accretion 205,742 - 11,157 747 7,551 7,001 232,198 Loss from operations (7,798,746 ) (84,075 ) (540,018 ) (55,341 ) (1,782,587 ) (612,620 ) (10,873,387 ) Other income (expenses) (2,545,544 ) (14,198 ) 1,695 - 3,218,765 3,164 663,882 Loss before income taxes $ (10,344,290 ) $ (98,273 ) $ (538,323 ) $ (55,341 ) $ 1,436,178 $ (609,456 ) $ (10,209,505 ) 24 Item 2. Management ’ s Discussion and Analysis of Financial Condition and Results of Operations The following management ’ s discussion and analysis of the Company ’ s financial condition and results of operations (the “ MD&A ” ) contain forward-looking statements that involve risks, uncertainties and assumptions including, among others, statements regarding our capital needs, business plans and expectations. In evaluating these statements you should consider various factors, including the risks, uncertainties and assumptions set forth in reports and other documents we have filed with or furnished to the SEC and, including, without limitation, this Form 10-Q Quarterly Report for the nine months ended April 30, 2021, and our Form 10-K Annual Report for the fiscal year ended July 31, 2020, including the consolidated financial statements and related notes contained therein. These factors, or any one of them, may cause our actual results or actions in the future to differ materially from any forward-looking statement made in this Quarterly Report. Refer to “ Cautionary Note Regarding Forward-looking Statements ” as disclosed in our Form 10-K Annual Report for the fiscal year ended July 31, 2020, and Item 1A, Risk Factors, under Part II - Other Information, of this Quarterly Report. Introduction This MD&A is focused on material changes in our financial condition from July 31, 2020, our most recently completed year end, to April 30, 2021, and our results of operations for the three and nine months ended April 30, 2021, and should be read in conjunction with Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, as contained in our Form 10-K Annual Report for Fiscal 2020. Business We are predominantly engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on uranium projects located in the United States and Paraguay, as more fully described in our Form 10-K Annual Report for Fiscal 2020. We utilize in-situ recovery (“ISR”) mining where possible which we believe, when compared to conventional open pit or underground mining, requires lower capital and operating expenditures with a shorter lead time to extraction and a reduced impact on the environment. We have one uranium mine located in the State of Texas, the Palangana Mine, which utilizes ISR mining and commenced extraction of U 3 O 8 , or yellowcake, in November 2010. We have one uranium processing facility located in the State of Texas, the Hobson Processing Facility, which processes material from the Palangana Mine into drums of U 3 O 8 , our only sales product and source of revenue, for shipping to a third-party storage and sales facility. As of April 30, 2021, we had no uranium supply or off-take agreements in place. Our fully-licensed and 100%-owned Hobson Processing Facility forms the basis for our regional operating strategy in the State of Texas, specifically the South Texas Uranium Belt where we utilize ISR mining. We utilize a “hub-and-spoke” strategy whereby the Hobson Processing Facility acts as the central processing site (the “hub”) for the Palangana Mine and future satellite uranium mining activities, such as our Burke Hollow and Goliad Projects, located within the South Texas Uranium Belt (the “spokes”). The Hobson Processing Facility has a physical capacity to process uranium-loaded resins up to a total of two million pounds of U 3 O 8 annually and is licensed to process up to one million pounds of U 3 O 8 annually. We acquired the fully permitted Reno Creek Project in August 2017 and expanded our operations to the strategic Powder River Basin in Wyoming. We also hold certain mineral rights in various stages of development in the States of Arizona, Colorado, New Mexico, Texas and Wyoming, in Canada and in the Republic of Paraguay, many of which are located in historically successful mining areas and have been the subject of past exploration and pre-extraction activities by other mining companies. We do not expect, however, to utilize ISR mining for all of the uranium mineral rights in which case we would expect to rely on conventional open pit and/or underground mining techniques. Since we completed the acquisition of the Alto Paraná Titanium Project located in Paraguay in July 2017, we are also involved in titanium mining and related activities, including exploration, development, extraction and processing of titanium minerals such as ilmenite. Our operating and strategic framework is based on expanding our uranium and titanium extraction activities, which includes advancing certain projects with established mineralized materials towards extraction and establishing additional mineralized materials on our existing uranium and titanium projects or through the acquisition of additional projects. 25 Uranium Market Developments Over the past few years, global uranium market fundamentals have been improving as the market transitions from an inventory driven to more of a production driven market. The spot market bottomed in November 2016 at about $17.75 per pound U 3 O 8 and stood at about $29.05 per pound at April 30, 2021 (UxC Broker Average Price). Production curtailments, and more recently, mine closures from several global producers, have lowered uranium supply over the past few years. In 2020, total global production was reduced from 2019 levels of about 142 million pounds to about 123 million pounds, primarily as a result of COVID-19 shutdowns. This event has accelerated a rebalancing in the market, resulting in about 19 million pounds of supply being removed that will not be made up. Supply and demand projections show a structural deficit between production and utility requirements of more than 40 million pounds per year through 2026 with the gap growing to more than 55 million pounds by 2030. The gap is being filled with secondary market sources, including finite inventory that is projected to decline in upcoming years. Higher priced contracts that have supported production are continuing to roll out of producer and utility supply portfolios. These higher priced contracts are not replaceable with current market prices below production costs for the vast majority of western producers. This will likely continue the trend of production cuts and deferrals until prices rise sufficiently to sustain long-term mining operations. In addition, some of the more significant global projects have recently shut down or are in their final stages of production as their resources become depleted. On the demand side of the equation, the global nuclear energy industry continues robust growth, with 55 new reactors connected to the grid since the start of 2013 and another 52 reactors under construction as of May 2021. Nuclear generation has continued to increase over the past several years and has eclipsed pre-Fukushima production levels. In the 2020 edition (World Energy Outlook 2020), the International Energy Agency “Stated Policies Scenario” sees installed nuclear capacity growth of over 15% from 2019 to 2040, reaching about 480 GWE. Further upside market pressure also appears likely as utilities finally return to a longer-term contracting cycle to replace expiring contracts, something the market has not experienced for several years. In a more recent market development, financial entities and various producers, including our Company, began purchasing significant quantities of drummed uranium inventory, further removing excess supplies that will likely not re-enter the market unless bundled in longer term contracts at much higher prices. In the United States, significant political developments are improving the outlook for American uranium producers. In September 2020, for the first time in 48 years, the Democratic Party platform endorsed nuclear power, creating a solid base of bipartisan political support for the nuclear industry. In October 2020, the U.S. Department of Commerce concluded an amendment to the Agreement Suspending the Antidumping Investigation on Uranium from the Russian Federation that reduces the United State’s dependence on Russian natural uranium concentrates up to 75% from prior levels. In December, the U.S. Federal Government omnibus spending bill passed by Congress included $75 million for initial funding of the 10-year U.S. Uranium Reserve (the “Uranium Reserve”). More recently, the Nuclear Prosperity and Security Act was reintroduced in the U.S. House of Representative that would direct the Secretary of Energy to establish and operate a U.S. Uranium Reserve. The Uranium Reserve is designed as a 10-year, $1.5 billion program to purchase newly mined U.S. origin uranium that fits well with the Company’s production ready, fully licensed domestic mining capabilities. In late March of this year, additional support for nuclear energy also emerged from the current administration as a proposed component of a “Clean Energy Standard” under a plan to revitalize U.S. infrastructure. Uranium Inventory Initiative The Company is investing inbuilding the next generation of low-cost and environmentally friendly uranium projects that will be competitive on a global basis. Despite our focus on low cost ISR mining with its low capital requirements, we saw a unique opportunity to purchase drummed uranium at prevailing spot prices which are below most global industry mining costs. Hence, we recently established a physical uranium inventory initiative (the “Initiative Program”) and have entered into agreements to purchase 2.505 million pounds of U.S. warehoused uranium. Various deliveries have or are scheduled to occur in March 2021 into June 2023 at the ConverDyn conversion facility located in Metropolis, Illinois, at a volume weighted average price of approximately $30 per pound. 26 This Initiative Program will support three objectives for our Company: (i) to bolster our balance sheet as uranium prices appreciate; (ii) to provide strategic inventory to support future marketing efforts with utilities that could compliment production and accelerate cashflows; and (iii) to increase the availability of our Texas and Wyoming production capacity for emerging U.S. origin specific opportunities which may command premium pricing due to scarcity of domestic uranium. One such U.S. origin specific opportunity is the Company’s plan to participate in supplying the Uranium Reserve, as outlined in the Nuclear Fuel Working Group report published by the U.S. Department of Energy. As of the date of this Quarterly Report, we have received 1,000,000 pounds of uranium inventory under our Initiative Program. Response to COVID-19 Pandemic In response to the COVID-19 pandemic and for the protection of our employees, we have arranged for our teams at our Vancouver, Corpus Christi and Paraguay offices to work remotely. In the meantime, we continued to operate our Palangana Mine at a reduced pace to capture residual uranium only and we continue to advance our ISR projects with engineering and geologic evaluations that support the Company’s extraction readiness strategy. Results of Operations For the three and nine months ended April 30, 2021, we recorded net losses of $4,590,161 ($0.02 per share) and $13,014,757 ($0.06 per share) and losses from operations of $4,863,141 and $11,773,329, respectively. For the three and nine months ended April 30, 2020, we recorded net losses of $3,273,644 ($0.02 per share) and $10,204,882 ($0.06 per share) and losses from operations of $3,158,511 and $10,873,387, respectively. During the three and nine months ended April 30, 2021, we continued with our strategic plan for reduced operations at our Palangana Mine to capture residual pounds of U 3 O 8 only. As a result, no U 3 O 8 extraction or processing costs were capitalized to inventories during the three months ended April 30, 2021. During the three months ended April 30, 2021, as part of the Initiative Program, we received 900,000 pounds of uranium inventory at a total cost of $26,193,818. As of April 30, 2021, the total value of inventories was $26,405,480 (July 31, 2020: $211,662). During the three months ended April 30, 2021, we commenced the 2021 drilling campaign and drilled 57 exploration holes totaling 27,285 feet at our Burke Hollow Project. Costs and Expenses Mineral Property Expenditures Mineral property expenditures primarily consisted of costs relating to permitting, property maintenance, exploration and pre-extraction activities and other non-extraction related activities on our projects. During the three and nine months ended April 30, 2021, mineral property expenditures totaled $1,478,754 and $3,141,772, respectively, of which $238,015 and $678,082, respectively, were directly related to maintaining operational readiness and permitting compliance for our Palangana Mine and Hobson Processing Facility. During the three and nine months ended April 30, 2020, mineral property expenditures totaled $956,564 and $3,803,338, respectively, of which $258,628 and $908,878, respectively, were directly related to maintaining operational readiness and permitting compliance for our Palangana Mine and Hobson Processing Facility. 27 The following table provides mineral property expenditures on our projects for the periods indicated: Three Months Ended April 30, Nine Months Ended April 30, 2021 2020 2021 2020 Mineral Property Expenditures Palangana Mine $ 216,791 $ 260,438 $ 648,459 $ 1,109,164 Goliad Project 51,437 54,486 168,493 151,293 Burke Hollow Project 626,695 154,672 942,311 1,024,345 Longhorn Project 2,289 2,289 6,866 14,735 Salvo Project 7,672 7,843 23,537 21,813 Anderson Project 19,469 19,519 58,360 49,004 Workman Creek Project 8,168 8,168 24,533 24,533 Slick Rock Project 12,994 13,123 39,123 39,527 Reno Creek Project 215,725 159,088 485,791 451,312 Yuty Project 7,129 27,664 21,457 58,578 Oviedo Project 109,676 69,446 256,091 298,505 Alto Paraná Titanium Project 88,796 36,323 134,710 202,656 Other Mineral Property Expenditures 111,913 143,505 332,041 357,873 $ 1,478,754 $ 956,564 $ 3,141,772 $ 3,803,338 General and Administrative During the three and nine months ended April 30, 2021, general and administrative expenses totaled $3,286,201 and $8,336,593, respectively, which increased by $1,158,314 and $1,498,742, respectively, compared to $2,127,887 and $6,837,851, respectively, for the three and nine months ended April 30, 2020. The increases primarily resulted from increases in corporate development and stock-based compensation expenses. The following summary provides a discussion of the major expense categories including analyses of the factors that caused significant variances compared to the same period last year: ● for the three months ended April 30, 2021, salaries and management fees totaled $516,883, which increased by $106,788 compared to $410,095 for the three months ended April 30, 2020, primarily as a result of reinstatement of salaries and fees which had been reduced during the initial months of the COVID-19 pandemic. For the nine months ended April 30, 2021, salaries and management fees totaled $1,262,153, which was consistent with $1,291,306 for the nine months ended April 30, 2020; ● for the three and nine months ended April 30, 2021, office, insurance, filing and listing fees, investor relations, corporate development and travel expenses totaled $1,400,984 and $2,803,230, respectively, which increased by $616,975 and $367,444, respectively, compared to $784,009 and $2,435,786, respectively, for the three and nine months ended April 30, 2020, primarily as a result of increases in consulting fees and corporate development expenses; ● for the three and nine months ended April 30, 2021, professional fees totaled $200,607 and $506,910, respectively, which decreased by $37,531 and $192,568, respectively, compared to $238,138 and $699,478, respectively, for the three and nine months ended April 30, 2020. The decrease primarily resulted from decrease in general legal fees and accounting and audit fees. Professional fees are primarily comprised of legal services related to certain transactional activities and regulatory compliance, in addition to audit and tax services; and ● for the three and nine months ended April 30, 2021, stock-based compensation totaled $1,167,727 and $3,764,300, respectively, which increased by $472,082 and $1,353,019, respectively, compared to $695,645 and $2,411,281, respectively, for the three and nine months ended April 30, 2020. During the three and nine months ended April 30, 2021, in response to the financial market uncertainty as a result of the COVID-19 pandemic, we continued to expand the scope of equity-based payments, including shares issued in lieu of cash for certain salaries and fees under our Stock Incentive Plan, to compensate certain employees and consultants. During Fiscal 2020, we granted approximately 6.2 million stock options to our directors, officers, employees and certain consultants and awarded 1.3 million RSUs to certain of our directors and officers. The stock-based compensation expenses included the fair value of compensation shares at the time of issuance and the amortization of the fair value of various stock awards granted in Fiscal 2020 and prior fiscal years using the graded vesting method. 28 Depreciation, Amortization and Accretion During the three and nine months ended April 30, 2021, depreciation, amortization and accretion totaled $98,186 and $294,964, respectively, which increased by $24,126 and $62,766, respectively, compared to $74,060 and $232,198, respectively, for the three and nine months ended April 30, 2020. Depreciation, amortization and accretion include depreciation and amortization of long-term assets acquired in the normal course of operations and accretion of asset retirement obligations. Other Income and Expenses Interest and Finance Costs During the three and nine months ended April 30, 2021, interest and finance costs totaled $636,178 and $2,356,819, respectively, which decreased by $199,505 and $223,152, respectively, compared to $835,683 and $2,579,971, respectively, for the three and nine months ended April 30, 2020. For the three and nine months ended April 30, 2021, interest paid on long-term debt totaled $274,222 and $1,051,111, respectively, which decreased by $125,778 and $166,667, respectively, compared to $400,000 and $1,217,778, respectively, for the three and nine months ended April 30, 2020. For the three and nine months ended April 30, 2021, amortization of debt discount totaled $296,401 and $1,122,096, respectively, which decreased by $102,830 and $121,936, respectively, compared to $399,231 and $1,244,032, respectively, for the three and nine months ended April 30, 2020. The decreases in interest on long-term debt and amortization of debt discount are a result of the decrease in the outstanding principal amount of our long-term debt to $10,000,000 from $20,000,000 in the comparable periods of last year. For the three and nine months ended April 30, 2021, surety bond premium totaled $48,718 and $138,797, respectively, which increased by $19,648 and $46,031, respectively, compared to $29,070 and $92,766, respectively, for the three and nine months ended April 30, 2020. The increases were primarily a result of increases in surety bond collateral amounts and the annual premium rate. Income from Equity-Accounted Investment During the three and nine months ended April 30, 2021, we recorded income of $456,132 and $353,440, respectively, as a result of the equity income pick up from URC’s operations. During the three months ended April 30, 2020, we recorded income of $684,443 as a result of the equity income pick up from URC’s operations, and during the nine months ended April 30, 2020, we recorded income of $3,048,219 primarily due to a dilution gain of $3,056,656 recognized as a result of the change of our ownership interest in URC due to URC’s initial public offering in December 2019, offset by a loss pick up totaling $8,437 from URC’s operations. Gain on Loan Extinguishment During the nine months ended April 30, 2021, we received a Notice of Paycheck Protection Program Forgiveness Payment from the Small Business Administration regarding the approval of our application for forgiveness of the PPP Loan amount of $277,250 and associated interest. As a result, we recognized a gain on loan extinguishment of $278,617. During the three months ended April 30, 2021, we repaid the CEBA Loan of CAD$30,000, 75% of the total CEBA Loan principal before its initial term date on December 31, 2022 and received a CEBA Loan Closure Confirmation for forgiveness of CEBA loan principal of CAD$10,000. As a result, we recognized a gain on loan extinguishment of $7,759. 29 Summary of Quarterly Results For the Quarters Ended April 30, 2021 January 31, 2021 October 31, 2020 July 31, 2020 Net loss $ (4,590,161 ) $ (3,461,059 ) $ (4,963,537 ) $ (4,405,634 ) Total comprehensive loss (4,097,060 ) (2,975,021 ) (4,900,776 ) (4,009,649 ) Basic and diluted loss per share (0.02 ) (0.02 ) (0.03 ) (0.02 ) Total assets 163,575,373 100,142,619 102,213,761 91,389,617 For the Quarters Ended April 30, 2020 January 31, 2020 October 31, 2019 July 31, 2019 Net loss $ (3,273,644 ) $ (1,888,661 ) $ (5,042,577 ) $ (6,334,132 ) Total comprehensive loss (3,752,792 ) (1,928,309 ) (5,052,471 ) (6,199,949 ) Basic and diluted loss per share (0.02 ) (0.01 ) (0.03 ) (0.04 ) Total assets 93,647,447 96,514,311 96,696,496 101,040,242 Liquidity and Capital Resources April 30, 2021 July 31, 2020 Cash and cash equivalents $ 43,930,316 $ 5,147,703 Term deposits 4,000,000 - Current assets 76,430,509 6,589,879 Current liabilities 12,201,873 2,037,402 Working capital 64,228,636 4,552,477 During the nine months ended April 30, 2021, we received net proceeds of $83,842,281 from various equity financings and $4,709,470 from the exercise of stock options and share purchase warrants, which significantly strengthened our working capital position. As at April 30, 2021, we had working capital of $64,228,636, which increased by $59,676,159 from the working capital of $4,552,477 as at July 31, 2020. During the three months ended and subsequent to April 30, 2021, we entered into agreements to purchase 2.505 million pounds of uranium inventories with a total purchase price of $75.9 million with delivery dates from March 2021 to June 2023, of which $18.1 million will become due in the next 12 months from the date that this Quarterly Report is issued. In addition, as of April 30, 2021, we had $10,000,000 of debt with a maturity date of January 31, 2022. However, we believe our existing cash resources and, if necessary, cash generated from the sale of the Company’s current assets, will provide sufficient funds to fulfill our uranium inventory purchase commitments, repay the $10,000,000 principal amount of the term debt when it becomes due and carry out our planned operations for 12 months from the date of this Quarterly Report. Our continuation as a going concern beyond 12 months from the date of this Quarterly Report will be dependent upon our ability to obtain adequate additional financing, as our operations are capital intensive and future capital expenditures are expected to be substantial. Historically we have been reliant primarily on equity financings from the sale of our common stock and on debt financings in order to fund our operations. We have also relied, to a limited extent, on cash flows generated from our mining activities during the years ended July 31, 2015 (“Fiscal 2015), 2013 (“Fiscal 2013) and 2012 (“Fiscal 2012”). However, we have yet to achieve profitability or develop positive cash flow from operations and we do not expect to achieve profitability or develop positive cash flow from operations in the near term. Our reliance on equity and debt financings is expected to continue for the foreseeable future, and their availability whenever such additional financing is required, will be dependent on many factors beyond our control including, but not limited to, the market price of uranium, the continuing public support of nuclear power as a viable source of electrical generation, the volatility in the global financial markets affecting our stock price and the status of the worldwide economy, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets. We may also be required to seek other forms of financing, such as asset divestitures or joint venture arrangements, to continue advancing our uranium projects which would depend entirely on finding a suitable third party willing to enter into such an arrangement, typically involving an assignment of a percentage interest in the mineral project. However, there is no assurance that we will be successful in securing any form of additional financing when required and on terms favorable to us. 30 Our operations are capital intensive and future capital expenditures are expected to be substantial. We will require significant additional financing to fund our operations, including continuing with our exploration and pre-extraction activities and acquiring additional mineral projects. In the absence of such additional financing, we would not be able to fund our operations, including continuing with our exploration and pre-extraction activities, which may result in delays, curtailment or abandonment of any one or all of our mineral projects. Our anticipated operations, including exploration and pre-extraction activities, will be dependent on and may change as a result of our financial position, the market price of uranium and other considerations, and such change may include accelerating the pace or broadening the scope of reducing our operations as originally announced in September 2013. Our ability to secure adequate funding for these activities will be impacted by our operating performance, other uses of cash, the market price of commodities, the market price of our common stock and other factors which may be beyond our control. Specific examples of such factors include, but are not limited to: ● if the market price of uranium weakens; ● if the market price of our common stock weakens; ● if the COVID-19 pandemic worsens or continues over an extended period and causes further financial market uncertainty; and ● if a nuclear incident, such as the events that occurred at Fukushima in March 2011, is to occur, continuing public support of nuclear power as a viable source of electrical generation may be adversely affected, which may result in significant and adverse effects on both the nuclear and uranium industries. Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional mineral projects and to continue with exploration and pre-extraction activities and mining activities on our existing mineral projects, will depend ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations by establishing ore bodies that contain commercially recoverable minerals and to develop these into profitable mining activities. Equity Financings On February 21, 2020, we filed a Form S-3 shelf registration statement under the Securities Act which was declared effective by the SEC on March 3, 2020 (the “2020 Shelf”) providing for the public offer and sale of certain securities of the Company from time to time, at our discretion, of up to an aggregate offering amount of $100 million. As a result of the 2020 Shelf, our March 10, 2017 Form S-3 registration statement was then deemed terminated and, as a consequence, our then April 9, 2019 ATM Offering Agreement and its related offering terminated unless renewed under the 2020 Shelf. On March 19, 2020, we entered into an Amending Agreement to the ATM Offering Agreement with the ATM Managers under which the Company may, from time to time, sell shares of its common stock having an aggregate offering price of up to $30 million through the ATM Managers under its ATM Offering through the 2020 Shelf. On September 23, 2020, we completed our September 2020 Offering of 12,500,000 units at a price of $1.20 per unit for gross proceeds of $15,000,000. Each unit was comprised of one share of the Company and one-half of one share purchase warrant, and each whole warrant entitles its holder to acquire one share at an exercise price of $1.80 per share exercisable immediately upon issuance and expiring 24 months from the date of issuance. In connection with the September 2020 Offering, we also issued compensation share purchase warrants to agents as part of share issuance costs to purchase 583,333 shares of our Company exercisable at an exercise price of $1.80 per share and expiring 24 months from the date of issuance. During the nine months ended April 30, 2021, we issued 13,668,906 shares of the Company’s common stock at a weighted average price of $2.19 per share under our ATM Offering for net cash proceeds of $29,320,949. On March 19, 2021, we completed the March 2021 Offering of 10,000,000 shares of the Company’s common stock at a price of $3.05 per share for net proceeds of $29,083,710. On April 8, 2021, we completed the April 2021 Offering of 3,636,364 shares of the Company’s common stock at a price of $3.30 per share for net proceeds of $11,315,966. In connection with the April 2021 Offering, we also issued, on a private placement basis, 181,818 Agent Warrants to the agent as partial compensation, and each Agent Warrant entitles its holder to acquire one share of common stock at an exercise price of $4.125 per share and expiring five years from the date of issuance. 31 As of April 30, 2021, $30 million of the 2020 Shelf was utilized under our ATM Offering and $69.8 million was utilized under our September 2020 Offering, March 2021 Offering and April 2021 Offering; and therefore, all but $200,000 was utilized under our 2020 Shelf. On May 17, 2021, we filed a Form S-3 shelf registration statement under the Securities Act which was declared effective by the SEC on June 1, 2021 providing for the public offer and sale of certain securities of the Company from time to time, at our discretion, of up to an aggregate offering amount of $200 million (the “2021 Shelf”), which included an at-the-market offering agreement prospectus (the “2021 ATM Offering”) covering the offering, issuance and sale of up to a maximum offering of $100 million as part of the $200 million under the 2021 Shelf. On May 14, 2021, we entered into an At The Market Offering Agreement (the “2021 ATM Offering Agreement”) with H.C. Wainwright & Co., LLC and certain co-managers (collectively, the “2021 ATM Managers”) as set forth in the 2021 ATM Offering Agreement under which we may, from time to time, sell shares of our common stock having an aggregate offering price of up to $100 million from time to time through the 2021 ATM Manager selected by us. Credit Facility On December 5, 2018, we entered into the Third Amended and Restated Credit Agreement with our Lenders, whereby we and the Lenders agreed to certain further amendments to our Credit Facility, under which initial funding of $10,000,000 was received by the Company upon closing of the Credit Facility on July 30, 2013, and additional funding of $10,000,000 was received by the Company upon closing of the amended Credit Facility on March 13, 2014. The Credit Facility is non-revolving with an amended term of 8.5 years since inception maturing on January 31, 2022, subject to an interest rate of 8% per annum, compounded and payable on a monthly basis. The Third Amended and Restated Credit Agreement superseded, in their entirety, our Second Amended and Restated Credit Agreement dated and effective February 9, 2016, our Amended and Restated Credit Agreement dated and effective March 13, 2014 and our Credit Agreement dated and effective July 30, 2013 with our Lenders. During the nine months ended April 30, 2021, we made voluntary payments totaling $10,000,000 to certain Lenders, which decreased the principal balance outstanding to $10,000,000. During the nine months ended April 30, 2021, and pursuant to the terms of the Third Amended and Restated Credit Agreement, we issued an aggregate of 1,249,039 shares with a fair value of $1,170,000, representing 6.5% of the $18,000,000 principal balance outstanding at the time, as payment of anniversary fees to our Lenders. Government Loans During Fiscal 2020, our Canadian subsidiary received a loan of $29,842 (CAD$40,000) under the CEBA Program. During the three months ended April 30, 2021, we repaid CAD$30,000 of the CEBA Loan, 75% of the total CEBA Loan principal before its initial term date on December 31, 2022 and received a CEBA Loan Closure Confirmation for forgiveness of CAD$10,000. During Fiscal 2020, we entered into a business loan agreement with Kleberg Bank, N.A., under the Paycheck Protection Program administered by the Small Business Administration, which is a part of the Coronavirus Aid, Relief, and Economic Security Act enacted by the U.S. Congress in response to the COVID-19 pandemic. On May 5, 2020, we received the PPP Loan in the amount of $277,250. During the nine months ended April 30, 2021, we received a Notice of Paycheck Protection Program Forgiveness Payment from the Small Business Administration regarding the approval of our application for forgiveness of the PPP Loan amount of $277,250 and associated interest. Promissory Note During the nine months ended April 30, 2021, in connection with the Goliad Land Purchase, we issued the Promissory Note with a principal amount of $380,000 to a landowner. The Promissory Note carries an interest rate of 5% per annum with principal and interest payable in 24 monthly installments with a maturity date of November 1, 2022. We may prepay the Promissory Note in any amount at any time before the maturity date without penalty. 32 Operating Activities During the nine months ended April 30, 2021, net cash used in operating activities was $35,250,208, of which $26,193,818 was for purchases of uranium inventories. Other significant operating expenditures included mineral property expenditures, general and administrative expenses and interest payments. During the nine months ended April 30, 2020, net cash used in operating activities was $10,332,656 for mineral property expenditures, general and administrative expenses and interest payments. Financing Activities During the nine months ended April 30, 2021, net cash provided by financing activities totaled $78,453,548, primarily from the net proceeds of $83,842,281 from various share offerings, and net proceeds of $4,709,470 from the exercise of stock options and share purchase warrants, which were offset by $10,000,000 in voluntary payments to our Lenders under our Credit Facility, $22,083 repayment for the CEBA Loan and payments of $76,120 for the Promissory Note. During the nine months ended April 30, 2020, cash provided by financing activities was $28,756 from the CEBA Loan. Investing Activities During the nine months ended April 30, 2021, net cash used by investing activities totaled $4,222,266, primarily for cash used for the investment in term deposits of $10,000,000, cash used for the purchase of property, plant and equipment of $142,266, and cash used for investment in mineral rights and properties of $80,000, offset by cash received from the redemption of term deposits of $6,000,000. During the nine months ended April 30, 2020, net cash provided by investing activities totaled $11,670,630, primarily from cash received from the redemption of term deposits totaling $11,831,671, offset by cash used for the purchase of property, plant and equipment of $83,841 and cash used for investment in mineral rights and properties of $80,000. Stock Options and Warrants As of April 30, 2021, we had stock options outstanding representing 11,170,110 shares at a weighted-average exercise price of $1.11 per share, and share purchase warrants outstanding representing 5,480,938 shares at a weighted-average exercise price of $1.90 per share. As of April 30, 2021, outstanding stock options and warrants represented a total 16,651,048 shares issuable for gross proceeds of approximately $22.7 million should these stock options and warrants be exercised in full on a cash basis. As of April 30, 2021, outstanding in-the-money share purchase warrants and stock options represented a total of 16,469,230 shares exercisable for gross proceeds of approximately $22.0 million should these in-the-money share purchase warrants and stock options be exercised in full on a cash basis. The exercise of stock options and warrants is at the discretion of the respective holders and, accordingly, there is no assurance that any of the stock options or warrants will be exercised in the future. Transactions with a Related Party During the three and nine months ended April 30, 2021, we incurred $17,900 and $52,041 (three and nine months ended April 30, 2020: $36,849 and $105,339), respectively, in general and administrative costs, paid to Blender, a company controlled by Arash Adnani, a direct family member of our President and Chief Executive Officer, for various services, including information technology, financial subscriptions, corporate branding, media, website design, maintenance and hosting, provided by Blender to the Company. As of April 30, 2021, the amount owing to Blender was $nil (July 31, 2020: $31,334). Material Commitments Uranium Purchase Commitments During the three months ended and subsequent to April 30, 2021, we entered into agreements to purchase 2.505 million pounds of uranium inventories under our Initiative Program, of which 1.0 million pounds have been delivered and paid for with the remaining 1.505 million pounds being delivered from December 2021 to June 2023. 33 Our uranium purchase commitments at the date of this Quarterly Report are as follows: For MDA Purchase Commitments in Pounds Total Purchase Price Fiscal 2022 600,000 $ 18,065,000 Fiscal 2023 905,000 29,179,000 Total 1,505,000 $ 47,244,000 Long-Term Debt Obligations At April 30, 2021, we have made all scheduled payments and complied with all covenants under our Credit Facility, and we expect to continue complying with all scheduled payments and covenants during Fiscal 2021. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. Critical Accounting Policies For a complete summary of all of our significant accounting policies refer to Note 2: Summary of Significant Accounting Policies of the Notes to the consolidated financial statements as presented under Item 8, Financial Statements and Supplementary Data, in our Annual Report on Form 10-K for Fiscal 2020. Refer to “Critical Accounting Policies” under Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for Fiscal 2020. Subsequent Events Subsequent to April 30, 2021, we received cash proceeds of $380,776 and issued 704,423 shares upon the exercise of 888,251 stock options. Subsequent to April 30, 2021, we entered into agreements to purchase 200,000 pounds of uranium inventories under our Initiative Program. Subsequent to April 30, 2021, on May 20, 2021, we participated in an equity financing by URC and acquired an additional 1,000,000 common shares of URC at a price of CAD$4.10 per share for a total consideration of $3,396,852. Item 3. Quantitative and Qualitative Disclosures About Market Risk Refer to Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for Fiscal 2020. 34