Western Uranium & Vanadium Corp. 10-Q

Item 1. Financial Statements WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS (Stated in USD) (Unaudited) As of September 30, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 6,646,402 $ 9,217,585 Restricted cash, current portion 75,075 75,075 Prepaid expenses 205,644 382,314 Marketable securities - 385 Other current assets 86,183 131,255 Total current assets 7,013,304 9,806,614 Restricted cash, net of current portion 737,918 676,369 Property, plant & equipment and mineral properties, net 15,670,078 14,926,289 Kinetic separation intellectual property 9,488,051 9,488,051 Total assets $ 32,909,351 $ 34,897,323 Liabilities and Shareholders’ Equity Liabilities Current liabilities: Accounts payable and accrued liabilities $ 763,442 $ 761,123 Reclamation liability, current portion 75,057 75,057 Total current liabilities 838,499 836,180 Reclamation liability, net of current portion 262,880 241,562 Deferred tax liability 2,708,887 2,708,887 Deferred contingent consideration 346,820 340,650 Total liabilities 4,157,086 4,127,279 Shareholders’ Equity Common shares, no par value, unlimited authorized shares, 55,223,419 and 50,002,395 shares issued as of September 30, 2024 and December 31, 2023, respectively, and 55,223,113 and 50,002,089 shares outstanding as of September 30, 2024 and December 31, 2023, respectively 55,178,572 49,661,910 Treasury shares, 306 shares held in treasury as of September 30, 2024 and December 31, 2023 - - Accumulated deficit ( 26,161,437 ) ( 18,817,857 ) Accumulated other comprehensive loss ( 264,870 ) ( 74,009 ) Total shareholders’ equity 28,752,265 30,770,044 Total liabilities and shareholders’ equity $ 32,909,351 $ 34,897,323 1 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS (Stated in USD) (Unaudited) For the Three Months Ended September 30, For the Nine Months Ended September 30, 2024 2023 2024 2023 Revenues $ 52,981 $ 89,144 $ 147,035 $ 357,908 Expenses Mining expenditures 1,166,343 730,854 3,860,173 1,992,503 Professional fees 127,049 44,382 484,926 303,312 General and administrative 813,403 365,197 2,604,516 1,384,316 Consulting fees 247,850 48,251 738,204 48,988 Total operating expenses 2,354,645 1,188,684 7,687,819 3,729,119 Operating loss ( 2,301,664 ) ( 1,099,540 ) ( 7,540,784 ) ( 3,371,211 ) Accretion and interest income, net ( 62,492 ) ( 39,498 ) ( 199,202 ) ( 126,979 ) Other income, net 1,998 - 1,998 ( 4,000 ) Net loss ( 2,241,170 ) ( 1,060,042 ) ( 7,343,580 ) ( 3,240,232 ) Other comprehensive (loss) income Foreign currency translation adjustment 14,018 ( 43,474 ) ( 190,861 ) 14,716 Comprehensive loss $ ( 2,227,152 ) $ ( 1,103,516 ) $ ( 7,534,441 ) $ ( 3,225,516 ) Net loss per share - basic and diluted $ ( 0.04 ) $ ( 0.02 ) $ ( 0.14 ) $ ( 0.07 ) Weighted average shares outstanding - basic and diluted 55,223,113 43,609,774 54,338,493 43,604,977 2 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Stated in USD) (Unaudited) Common Shares Treasury Shares Accumulated Accumulated Other Comprehensive Shares Amount Shares Amount Deficit Loss Total Balance as of January 1, 2024 50,002,089 $ 49,661,910 306 $ - $ ( 18,817,857 ) $ ( 74,009 ) $ 30,770,044 Foreign currency translation adjustment - - - - - ( 142,359 ) ( 142,359 ) Proceeds from the exercise of warrants 5,198,540 4,605,458 - - - - 4,605,458 Stock-based compensation - stock options - 522,862 - - - - 522,862 Cashless exercise of stock options 22,484 - - - - - - Net loss - - - - ( 2,476,888 ) - ( 2,476,888 ) Balance as of March 31, 2024 55,223,113 $ 54,790,230 306 $ - $ ( 21,294,745 ) $ ( 216,368 ) $ 33,279,117 Foreign currency translation adjustment - - - - - ( 62,520 ) ( 62,520 ) Stock-based compensation - stock options - 236,442 - - - - 236,442 Net loss - - - - ( 2,625,522 ) - ( 2,625,522 ) Balance as of June 30, 2024 55,223,113 $ 55,026,672 306 $ - $ ( 23,920,267 ) $ ( 278,888 ) $ 30,827,517 Foreign currency translation adjustment - - - - - 14,018 14,018 Stock-based compensation - stock options - 151,900 - - - - 151,900 Net loss - - - - ( 2,241,170 ) - ( 2,241,170 ) Balance as of September 30, 2024 55,223,113 $ 55,178,572 306 $ - $ ( 26,161,437 ) $ ( 264,870 ) $ 28,752,265 Balance as of January 1, 2023 43,602,565 $ 43,394,303 306 $ - $ ( 13,875,263 ) $ ( 261,132 ) 29,257,908 Foreign currency translation adjustment - - - - - 6,314 6,314 Stock-based compensation - stock options - 252,742 - - - - 252,742 Net loss - - - - ( 1,103,531 ) - ( 1,103,531 ) Balance as of March 31, 2023 43,602,565 $ 43,647,045 306 $ - $ ( 14,978,794 ) $ ( 254,818 ) $ 28,413,433 Foreign currency translation adjustment - - - - - 51,876 51,876 Stock based compensation - stock options - 98,158 - - - - 98,158 Net loss - - - - ( 1,076,659 ) - ( 1,076,659 ) Balance as of June 30, 2023 43,602,565 $ 43,745,203 306 $ - $ ( 16,055,453 ) $ ( 202,942 ) $ 27,486,808 Foreign currency translation adjustment - - - - - ( 43,474 ) ( 43,474 ) Proceeds from the exercise of warrants 656,000 551,629 - - - - 551,629 Net loss - - - - ( 1,060,042 ) - ( 1,060,042 ) Balance as of September 30, 2023 44,258,565 $ 44,296,832 306 $ - $ ( 17,115,495 ) $ ( 246,416 ) $ 26,934,921 3 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Stated in USD) (Unaudited) For the Nine Months Ended September 30, 2024 2023 Cash Flows Used In Operating Activities: Net loss $ ( 7,343,580 ) $ ( 3,240,232 ) Reconciliation of net loss to cash used in operating activities: Depreciation 433,148 163,223 Loss on the sale of equipment 1,998 - Accretion of reclamation liability 9,164 9,321 Stock-based compensation 893,688 350,900 Change in marketable securities 385 189 Changes in operating assets and liabilities: Prepaid expenses and other current assets 221,742 185,657 Accounts payable and accrued liabilities 2,319 26,333 Reclamation Liability 12,154 4,035 Deferred revenue - ( 43,860 ) Contingent consideration 6,170 ( 18,853 ) Net cash used in operating activities ( 5,762,812 ) ( 2,563,287 ) Cash Flows Used In Investing Activities Purchase of property, plant & equipment and mineral properties ( 1,182,935 ) ( 1,874,183 ) Proceeds from sale of equipment 4,000 - Net cash used in investing activities ( 1,178,935 ) ( 1,874,183 ) Cash Flows Provided By Financing Activities Proceeds from warrant exercises 4,605,458 551,629 Net cash provided by financing activities 4,605,458 551,629 Effect of foreign exchange rate on cash ( 173,345 ) 14,716 Net increase (decrease) in cash and cash equivalents and restricted cash ( 2,509,634 ) ( 3,871,125 ) Cash and cash equivalents and restricted cash - beginning 9,969,029 10,433,538 Cash and cash equivalents and restricted cash - ending $ 7,459,395 $ 6,562,413 Cash and cash equivalents $ 6,646,402 $ 5,810,969 Restricted cash, current portion 75,075 75,075 Restricted cash, noncurrent 737,918 676,369 Total cash and cash equivalents and restricted cash $ 7,459,395 $ 6,562,413 Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ - $ - Income taxes $ - $ - 4 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 1 – BUSINESS Nature of operations Western Uranium & Vanadium Corp. (“Western” or the “Company”) was incorporated in December 2006 under the Ontario Business Corporations Act. On November 20, 2014, the Company completed a listing process on the Canadian Securities Exchange (“CSE”). As part of that process, the Company acquired 100 % of the members’ interests of Pinon Ridge Mining LLC (“PRM”), a Delaware limited liability company. The transaction constituted a reverse takeover (“RTO”) of Western by PRM. Subsequent to obtaining appropriate shareholder approvals, the Company reconstituted its Board of Directors and senior management team. Western is a Canadian domestic issuer and Canadian reporting issuer. The Company’s registered office is located at 330 Bay Street, Suite 1400, Toronto, Ontario, Canada, M5H 2S8, and its common shares are listed on the CSE under the symbol “WUC.” On April 22, 2016, the Company’s common shares began trading on the OTC Pink Open Market, and on May 23, 2016, the Company’s common shares were approved for trading on the OTCQX Best Market under the symbol “WSTRF”. The Company’s principal business activity is the acquisition and development of uranium and vanadium resource properties in the states of Utah and Colorado in the United States of America (“United States”). On September 16, 2015, Western completed its acquisition of Black Range Minerals Limited (“Black Range”). Under United States Securities and Exchange Commission (“Commission”) rules, this transaction triggered the Company being deemed a United States domestic issuer and losing its foreign private issuer exemption. On April 29, 2016, the Company filed a Form 10 registration statement with the Commission after converting its basis of accounting from International Financial Reporting Standards (“IFRS”) to generally accepted accounting principles in the United States (“U.S. GAAP”). On June 28, 2016, the Company’s registration statement became effective and Western became a United States reporting issuer. On June 30, 2023, Western re-qualified as a foreign private issuer as that term is defined in Rule 3b-4(c) promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”). As a result, the Company may now utilize certain accommodations made to foreign private issuers, including (1) an exemption from complying with the Commission’s proxy rules, (2) an exemption from the Company’s insiders having to comply with the reporting and short-swing trading liability provisions of Section 16 under the Exchange Act, (3) the ability to make periodic filings with the Commission on the Form 20-F and Form 6-K foreign issuer forms, and (4) the ability to offer and sell unrestricted securities outside of the United States pursuant to Rule 903 of Regulation S. The Company intends to take advantage of these accommodations. However, the Company currently has decided to voluntarily continue to file periodic reports with the Commission using domestic issuer forms including filing annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. On the subsequent measurement date June 30, 2024, Western reconfirmed its qualification as a foreign private issuer. Note 2 – Liquidity and going concern With the exception of the quarter ended June 30, 2022, the Company has incurred losses from its operations. During the three and nine months ended September 30, 2024, the Company generated a net loss of $ 2,241,170 and $ 7,343,580 , respectively. The Company expects to generate operating losses for the foreseeable future as it incurs expenses to bring its mineral processing facilities online and further expand mining operations. As of September 30, 2024, the Company had an accumulated deficit of $ 26,161,437 and working capital of $ 6,174,805 . Since inception, the Company has met its liquidity requirements principally through the issuance of notes and the sale of its common shares. During the nine months ended September 30, 2024, the Company received $ 4,605,458 in proceeds from the exercise of its common share warrants. On December 12, 2023, the Company closed a non-brokered private placement of 5,215,828 units at a price of $ 1.02 (CAD $ 1.39 ) per unit. The aggregate gross proceeds raised in the private placement amounted to $ 5,324,988 (CAD $ 7,250,000 ) and net proceeds amounted to $ 4,836,867 (CAD $ 6,588,089 ). During the year ended December 31, 2023, the Company received $ 1,004,044 in proceeds from the exercise of its common share warrants. The Company’s ability to continue its planned operations and to pay its obligations when they become due is contingent upon the Company obtaining additional financing. Management’s plans include seeking to procure additional funds through debt and equity financing, to secure regulatory approval to fully utilize its kinetic separation (“Kinetic Separation”) technology, and to initiate the processing of ore to generate operating cash flows. 5 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 2 – Liquidity and going concern, continued There are no assurances that the Company will be able to raise capital on terms acceptable to the Company or at all, or that cash flows generated from its operations will be sufficient to meet its current operating costs. If the Company is unable to obtain sufficient amounts of additional capital, it may be required to reduce the scope of its planned product development, which could harm its financial condition and operating results, or it may not be able to continue to fund its ongoing operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern to sustain operations for at least one year from the issuance of these condensed interim consolidated financial statements. The accompanying condensed interim consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying condensed interim consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Rule 10 of Regulation S–X. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. However, in the opinion of management of the Company, all adjustments necessary for a fair presentation of the financial position and operating results have been included in these condensed interim consolidated financial statements. These condensed interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10–K for the fiscal year ended December 31, 2023, as filed with the SEC on April 16, 2024. The Company has voluntarily elected to file this Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 notwithstanding its foreign private issuer status. Operating results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for any subsequent quarters or for the year ending December 31, 2024. The accompanying condensed interim consolidated financial statements include the accounts of Western and its wholly-owned subsidiaries, Western Uranium Corporation (Utah), PRM, Black Range, Black Range Copper Inc., Ranger Resources Inc., Black Range Minerals Inc., Black Range Minerals Colorado LLC, Black Range Minerals Wyoming LLC, Haggerty Resources LLC, Ranger Alaska LLC, Black Range Minerals Utah LLC, Black Range Minerals Ablation Holdings Inc., Black Range Development Utah LLC and Maverick Strategic Minerals Corp. All inter-company transactions and balances have been eliminated upon consolidation. The Company reports operating and financial results in a single segment based on the consolidated information used by the chief operating decision maker (“CODM”) in evaluating the financial performance of its business and allocating resources. This single segment reflects the Company’s core business: produce critical minerals. As the Company has one reportable segment, net loss, total assets and working capital are equal to consolidated results. The Company has established the existence of mineralized materials for certain uranium projects. The Company has not established proven or probable reserves, as defined by the United States Securities and Exchange Commission (the “SEC”), through the completion of a “final” or “bankable” feasibility study for any of its uranium projects. Exploration Stage and Mineral Properties 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 the Company exits the exploration stage by establishing proven or probable reserves. Expenditures relating to exploration activities, such as drill programs to search for additional mineralized materials, are expensed as incurred. Expenditures relating to pre-extraction activities, such as the construction of mine wellfields, ion exchange facilities, disposal wells, and mine development, are expensed as incurred until such time proven or probable reserves are established for that uranium project, after which subsequent expenditures relating to development activities for that particular project are capitalized as incurred. Expenditures relating to mining and production while the Company is in the exploration stage and while the mined material is stockpiled underground are expensed as incurred. 6 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 3 – SUMMARY OF Significant Accounting Policies, CONTINUED Exploration Stage and Mineral Properties, continued Production stage issuers, as defined in subpart 1300 of Regulation S-K, having engaged in material extraction of established mineral reserves on at least one material property, 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. The Company is an exploration stage issuer, which has resulted in the Company reporting larger losses than if it had been in the production stage due to the expensing, instead of capitalizing, of expenditures relating to ongoing mine development and extraction activities. Additionally, there would be no corresponding amortization allocated to future reporting periods of the Company since those costs would have been expensed previously, resulting in both lower inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if the Company 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, the Company’s condensed interim consolidated financial statements may not be directly comparable to the financial statements of companies in the production stage. Western will not be eligible to become a production stage issuer, and will remain an exploration stage issuer, until such time as mineral reserves are established on at least one material property. Use of Estimates The preparation of these condensed interim consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and revenues and expenses during the periods reported. By their nature, these estimates are subject to measurement uncertainty, and the effects on the condensed interim consolidated financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions include the determination of the fair value of transactions involving common shares, assessment of the useful life and evaluation for impairment of Kinetic Separation intellectual property, valuation and impairment assessments of mineral properties and equipment, valuation of deferred contingent consideration, valuation of the reclamation liability and valuation of stock-based compensation. Other areas requiring estimates include allocations of expenditures, depletion, and amortization of mineral rights and properties. Actual results could differ from those estimates. Foreign Currency Translation The reporting currency of the Company, including its subsidiaries, is the United States dollar. The financial statements of subsidiaries located outside of the U.S. are measured in their functional currency, which is the local currency. The functional currency of the parent (Western Uranium & Vanadium Corp. (Ontario)) is the Canadian dollar. The functional currencies of the subsidiaries is the United States dollar. Monetary assets and liabilities of these subsidiaries are translated at the exchange rates at the balance sheet date. Transactions denominated in currencies other than the functional currency are recorded based on the exchange rates at the time of the transaction. Income and expense items are translated using average monthly exchange rates. Non-monetary assets are translated at their historical exchange rates. Translation adjustments are included in “Accumulated other comprehensive loss” in the condensed interim consolidated balance sheets. Segment Information The Company identifies its operating segments in accordance with Accounting Standards Codification 280, Segment Reporting, or ASC 280. Operating segments are defined as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker, its Chief Executive Officer, manages the Company’s operations on a consolidated basis for the purposes of allocating resources. Accordingly, the Company has determined it operates and manages its business in a single reportable operating segment. 7 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 3 – SUMMARY OF Significant Accounting Policies, CONTINUED Cash and Cash Equivalents The Company considers all highly-liquid instruments with an original maturity of three months or less at the time of issuance to be cash equivalents. There were no cash equivalents at September 30, 2024 and December 31, 2023. Marketable Securities The Company classifies its marketable securities as available-for-sale securities, which are carried at their fair value based on the quoted market prices of the securities with unrealized gains and losses reported as accumulated other comprehensive (loss) income, a separate component of shareholders’ equity. Realized gains and losses on available-for-sale securities are included in net earnings in the period earned or incurred. Effective September 30, 2024 the Company’s sole marketable security was fully impaired and written off. Restricted Cash Certain cash balances are restricted as they relate to deposits with banks that have been assigned to state reclamation authorities in the United States to secure various reclamation guarantees with respect to mineral properties in Utah and Colorado. As these funds are not available for general corporate purposes and secure the long term reclamation liability (see Note 4), they have been separately disclosed and classified as long-term for the majority of the Company’s mines. As of September 30, 2024 and December 31, 2023, the Company has determined that the Van 4 Mine is considered to be in reclamation. The Company recognized the Van 4 Mine’s reclamation liability and its restricted cash in full on the Company’s condensed interim consolidated balance sheets as current. Property, Plant & Equipment and Mineral Properties, Net Property, plant and equipment is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method. Revenue Recognition The Company leases certain of its mineral properties for the exploration and production of oil and gas reserves. The Company accounts for lease revenue in accordance with the Financial Accounting Standards Board (“FASB”) ASC 842, Leases . Lease payments received in advance are deferred and recognized on a straight-line basis over the related lease term associated with the prepayment. Royalty payments are recognized as revenues based upon production. Fair Values of Financial Instruments The carrying amounts of cash and cash equivalents, restricted cash – current portion, accounts payable and accrued liabilities approximate their fair value due to the short-term nature of these instruments. Marketable securities are adjusted to fair value at each balance sheet date based on quoted prices which are considered level 1 inputs. The Company’s operating and financing activities are conducted primarily in Canadian dollars, and as a result, the Company is subject to exposure to market risks from changes in foreign currency rates. The carrying amount of restricted cash – net of current portion, approximates fair value as the accounts earn interest at market rates. The Company is exposed to credit risk through its cash and restricted cash but mitigates this risk by keeping these deposits at major financial institutions. The FASB ASC 820, Fair Value Measurements and Disclosures , provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). 8 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 3 – SUMMARY OF Significant Accounting Policies, continued Fair Values of Financial Instruments, continued Fair value is defined as an exit price, representing the amount that would be received upon the sale of an asset or payment to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly. Level 3- Significant unobservable inputs that cannot be corroborated by market data and inputs that are derived principally from or corroborated by observable market data or correlation by other means. The fair value of the Company’s financial instruments are as follows (the Company had no marketable securities as of September 30, 2024): Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Quoted Prices for Similar Assets or Liabilities in Active Markets (Level 2) Significant Unobservable Inputs (Level 3) Marketable securities as of December 31, 2023 $ 385 $ - $ - Stock-Based Compensation The Company follows the FASB ASC 718, Compensation - Stock Compensation , which addresses the accounting for stock-based payment transactions, requiring such transactions to be accounted for using the fair value method. Awards of shares for property or services are recorded at the fair value of the stock or the fair value of the service, whichever is more readily measurable. The Company uses the Black-Scholes option-pricing model to determine the grant date fair value of stock-based awards under ASC 718. The fair value is charged to earnings depending on the terms and conditions of the award, and the nature of the relationship of the recipient of the award to the Company. The Company records the grant date fair value in line with the period over which it was earned. For employees and consultants, this is typically considered to be the vesting period of the award. 9 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 3 – SUMMARY OF Significant Accounting Policies, continued Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and warrants (using the treasury stock method). The computation of net loss per share for each of the three and nine months ended September 30, 2024 and 2023 is the same for both basic and fully diluted. Potentially dilutive securities outlined in the table below have been excluded from the computation of diluted net loss per share because the effect of their inclusion would have been anti-dilutive. For the Three Months Ended September 30, For the Nine Months Ended September 30, 2024 2023 2024 2023 Warrants to purchase common shares 5,578,739 8,706,076 5,578,739 8,706,076 Options to purchase common shares 4,473,334 3,770,334 4,473,334 3,770,334 Total potentially dilutive securities 10,052,073 12,476,410 10,052,073 12,476,410 Recent Accounting Standards In November 2023, the FASB issued Accounting Standard Update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU requires annual and interim disclosures about significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss as well as the amount and composition of other segment items. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company is still evaluating the full extent of the potential impact of the adoption of ASU 2023-09, but believes it will not have a material impact on its condensed interim consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09 – Improvements to Income Tax Disclosures, which enhances the transparency and decision usefulness of income tax disclosures. The standard is effective for public companies for annual periods beginning after December 15, 2024. Early adoption is available. The Company is still evaluating the full extent of the potential impact of the adoption of ASU 2023-09, but believes it will not have a material impact on its condensed interim consolidated financial statements and disclosures. 10 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 4 - Property, plant & equipment and mineral properties, net AND Kinetic separation INTELLECTUAL PROPERTY The Company’s mining properties acquired on August 18, 2014 that the Company retains as of September 30, 2024 include: The San Rafael Uranium Project located in Emery County, Utah; The Sunday Mine Complex located in western San Miguel County, Colorado; The Van 4 Mine located in western Montrose County, Colorado; The Sage Mine located in San Juan County, Utah, and San Miguel County, Colorado. These mining properties include leased land in the states of Colorado and Utah. None of these mining properties were operational at the date of acquisition. The Company’s mining properties acquired on September 16, 2015 that the Company retains as of September 30, 2024 include: Hansen, North Hansen and Hansen Picnic Tree located in Fremont and Teller Counties, Colorado. The Company also acquired the Keota project located in Weld County, Colorado and the Ferris Haggerty project located in Carbon County, Wyoming. These mining assets include both owned and leased land in the states of Utah, Colorado, and Wyoming. All of the mining assets represent properties which have previously been mined, to different degrees, for uranium. As the Company has not formally established proven or probable reserves on any of its properties, there is inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated. The Company’s property, plant & equipment and mineral properties, net and kinetic separation intellectual property are: Estimated Useful Lives As of September 30, 2024 As of December 31, 2023 Mineral properties N/A $ 11,688,841 $ 11,688,841 Mining equipment 5 years 3,144,398 2,345,055 Vehicles 5 years 1,048,246 549,703 Software 5 years 9,120 - Construction in progress N/A 177,658 312,384 Land N/A 351,957 351,957 Total property, plant & equipment and mineral properties $ 16,420,220 $ 15,247,940 Less: accumulated depreciation 750,142 321,651 Property, plant & equipment and mineral properties, net $ 15,670,078 $ 14,926,289 Kinetic separation intellectual property $ 9,488,051 $ 9,488,051 11 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 4 - PROPERTY, PLANT & EQUIPMENT AND MINERAL PROPERTIES, NET AND KINETIC SEPARATION INTELLECTUAL PROPERTY, continued Property, plant & equipment and mineral properties, net During the nine months ended September 30, 2024 and 2023, Western made purchases of $ 1,182,935 and $ 1,874,183 , which principally consisted of mining equipment and vehicles to increase mining capacity. For the three months ended September 30, 2024 and 2023, depreciation expense was $ 168,782 and $ 65,886 , and for the nine months ended September 30, 2024 and 2023, depreciation expense was $ 433,148 and $ 163,223 , respectively, which was included in mining expenditures on the Company’s condensed interim consolidated statements of operations and other comprehensive loss. Oil and Gas Lease and Easement In 2017, the Company entered into an oil and gas lease that became effective with respect to minerals and mineral rights owned by the Company on approximately 160 surface acres of the Company’s property in Colorado. As consideration for entering into the lease, the lessee has agreed to pay the Company a royalty from the lessee’s revenue attributed to oil and gas produced, saved, and sold attributable to the net mineral interest. The Company has also received cash payments from the lessee related to the easement that the Company is recognizing incrementally over the eight year term of the easement. On June 23, 2020, the operator elected to extend the oil and gas lease easement for three additional years through July 2023. This was done to provide additional time in order to complete well construction and commence oil and gas production. During 2021, the operator completed a first set of eight (8) wells which commenced oil and gas production by August 2021. During 2022, the operator completed a second set of eight (8) wells which commenced oil and gas production by August 2022. All sixteen (16) wells remain in production and monthly royalty payments will be ongoing in perpetuity as long as oil and/or gas are produced from the pooled unit containing these sixteen (16) wells. For the three months ended September 30, 2024 and 2023, the Company recognized aggregate revenue of $ 52,981 and $ 89,144 , respectively, and for the nine months ended September 30, 2024 and 2023, the Company recognized aggregate revenue of $ 147,035 and $ 357,908 , respectively, under these oil and gas lease arrangements. Reclamation Liabilities The Company’s mines are subject to certain asset retirement obligations, which the Company has recorded as reclamation liabilities. The reclamation liabilities of the United States mines are subject to legal and regulatory requirements, and estimates of the costs of reclamation are reviewed periodically by the applicable regulatory authorities. The reclamation liability represents the Company’s best estimate of the present value of future reclamation costs in connection with the mineral properties. In connection with the Company’s San Rafael Mine, during the three months ended September 30, 2024, the Company incurred an additional gross and discounted reclamation liability of $ 61,403 and $ 12,154 , respectively. The Company determined the gross reclamation liabilities of the mineral properties to be $ 812,027 and $ 751,444 as of September 30, 2024 and December 31, 2023, respectively. The portion of the reclamation liability related to the Van 4 Mine, which is in reclamation as of September 30, 2024, and its related restricted cash are included in current liabilities and current assets, respectively, at a value of $ 75,057 . During the nine months ended September 30, 2024, the Company’s internal mining operations team has been performing the Van 4 Mine reclamation work, and the State of Colorado has not yet reduced the associated reclamation liability amount. The Company expects to begin incurring the reclamation liability after 2054 for all mines that are not in reclamation and accordingly, has discounted the gross liabilities over their remaining lives using a discount rate of 5.4 %. The net discounted aggregated values as of September 30, 2024 and December 31, 2023 were $ 262,880 and $ 241,562 , respectively. The gross reclamation liabilities as of September 30, 2024 and December 31, 2023 are secured by financial warranties in the amount of $ 812,027 and $ 751,444 , respectively. 12 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 4 - PROPERTY, PLANT & EQUIPMENT AND MINERAL PROPERTIES, NET AND KINETIC SEPARATION INTELLECTUAL PROPERTY, continued Reclamation Liabilities, continued Reclamation liability activity consists of: For the Nine Months Ended September 30, 2024 2023 Beginning balance at January 1 $ 316,619 $ 300,276 Adjustment to reclamation liability 12,154 4,035 Accretion 9,164 9,321 Ending Balance at September 30 $ 337,937 $ 313,632 Less: Reclamation liability, current portion 75,057 75,057 Reclamation liability, net of current portion $ 262,880 $ 238,575 Topaz Mine Permitting Status In November 2020 and December 2020, a coalition of environmental groups (the “Plaintiffs”) filed a complaint against the Mined Land Reclamation Board (“MLRB”) seeking partial appeals of prior MLRB decisions, requesting the termination of the Topaz Mine permit. The Company joined with the MLRB in defense of those decisions. On May 5, 2021, the Plaintiffs in the Topaz Appeal filed an opening brief with the Denver District Court seeking to overturn the July 22, 2020 and October 21, 2020 MLRB permit hearing decisions on the Topaz Mine permit. The MLRB and the Company sought a settlement with the Plaintiffs. A settlement was not reached, and the MLRB and the Company submitted answer briefs on August 20, 2021. The Plaintiffs submitted a reply brief on September 10, 2021. On March 1, 2022, the Denver District Court reversed the MLRB’s orders regarding the Topaz Mine and remanded the case back to the MLRB for further proceedings consistent with its order. Subsequently on March 20, 2023, the MLRB issued a board order for the Company to commence final reclamation, which upon completion will terminate mining operations at the Topaz Mine. Reclamation commenced immediately at the Topaz Mine and is to be completed within five years by March 2028. The Company has been working toward the completion of an updated Topaz Mine Plan of Operations (“Topaz Mine Plan”), which is a separate federal requirement of the U.S. Bureau of Land Management (“BLM”) for the conduct of mining activities on the federal land at the Topaz Mine. This is a prerequisite to re-permit the Topaz Mine with Colorado’s DRMS. In connection with the Topaz Mine Plan, an environmental assessment was prepared by an outside consultant and submitted to the BLM on June 24, 2024. The BLM issued a letter to the Company on August 2, 2024 advising that the application for the Topaz Mine Plan had run past the allowed evaluation period and was cancelled. A new federal law called the Fiscal Responsibility Act of 2023 was enacted that creates a one year time limit for BLM reviews. Under the transitional rules, the Topaz project was not eligible for an extension due to its duration. However, the project can be resubmitted and be picked-up where it was left off. The re-scoping process will need to be repeated to start the one year time clock. The Company is making a determination as to the best means and timing to resubmit its application. San Rafael Permitting Status The San Rafael Uranium Project, located in Emery County, Utah, is being developed as the Company's second production facility. During the second quarter 2024, Western submitted a Notice of Intent to the BLM that was approved for a mineral and groundwater exploration project. During the third quarter of 2024, Utah’s Division of Oil, Gas & Mining gave its approval of the exploration permit application and the Company posted a $ 60,300 Financial Guarantee of reclamation costs with the BLM. Following the completion of repairs to access roads, the phase 1 drilling program is set to begin in 2024. Initially, groundwater monitoring wells will be installed at five drilling locations, reaching depths of approximately 1,000 feet. During the borehole completion process, mineralization will also be assessed and confirmed against historical drill data. This project will provide the baseline data needed for permitting application submission. 13 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 4 - PROPERTY, PLANT & EQUIPMENT AND MINERAL PROPERTIES, NET AND KINETIC SEPARATION INTELLECTUAL PROPERTY, continued Kinetic Separation Intellectual Property The Kinetic Separation intellectual property was acquired in Western’s acquisition of Black Range on September 16, 2015. Previously Black Range acquired its Kinetic Separation assets in the dissolution of a joint venture on March 17, 2015, through the acquisition of all the assets of the joint venture and received a 25-year license to utilize all of the patented and unpatented technology owned by the joint venture. The technology license agreement for patents and unpatented technology became effective as of March 17, 2015, for a period of 25 years, until March 16, 2040. There are no remaining license fee obligations, and there are no future royalties due under the agreement. The Company has the right to sub-license the technology to third parties. The Company may not sell or assign the Kinetic Separation license; however, the license could be transferred in the case of a sale of the Company. The Company has developed improvements to Kinetic Separation during the term of the license agreement and retains ownership of, and may obtain patent protection on, any such improvements developed by the Company. The Kinetic Separation patent was filed on September 13, 2012 and granted on February 14, 2014 by the United States Patent Office. The patent is effective for a period of 20 years until September 13, 2032. This patent is supported by two provisional patent applications. The provisional patent applications expired after one year but were incorporated in the U.S. Patent by reference and claimed benefit prior to their expirations. The status of the patent and two provisional patent applications has not changed subsequent to the 2014 patent grant. The Company has the continued right to use any patented portion of the Kinetic Separation technology that enters the public domain subsequent to the patent expiration. The Company anticipates Kinetic Separation will improve the efficiency of the mining and processing of the sandstone-hosted mined material from Western’s conventional mines through the separation of waste from mineral bearing-ore, potentially reducing transportation, mill processing, and mill tailings costs. Kinetic Separation is not currently in use or being applied at any Company mines. The Company views Kinetic Separation as a cost saving technology, which it will seek to incorporate subsequent to commencing scaled production levels. There are also alternative applications, which the Company has explored. NOTE 5 - Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities consist of: As of September 30, 2024 December 31, 2023 Trade accounts payable $ 499,710 $ 562,831 Accrued liabilities 263,732 198,292 Total accounts payable and accrued liabilities $ 763,442 $ 761,123 14 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 6 - SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS Authorized Capital The holders of the Company’s common shares are entitled to one vote per share. Holders of common shares are entitled to ratably receive such dividends, if any, as may be declared by the board of directors, out of legally available funds. Upon the liquidation, dissolution, or winding down of the Company, holders of common shares are entitled to share ratably in all assets of the Company that are legally available for distribution. As of September 30, 2024 and December 31, 2023, an unlimited number of common shares were authorized for issuance. Warrant Exercises During the three and nine months ended September 30, 2024, an aggregate of 0 and 5,198,540 warrants were exercised for total proceeds of $ 0 and $ 4,605,458 (CAD $ 6,238,248 ), respectively. During the three and nine months ended September 30, 2023, an aggregate of 656,000 warrants were exercised for total gross proceeds of $ 551,629 . Incentive Stock Option Plan The Company maintains an Incentive Stock Option Plan (the “Plan”) that permits the granting of stock options as incentive compensation. The purpose of the Plan is to attract, retain, and motivate directors, management, staff, and consultants by providing them with the opportunity, through stock options, to acquire a proprietary interest in the Company and benefit from its growth. The Plan provides that the aggregate number of common shares for which stock options may be granted will not exceed 10 % of the issued and outstanding common shares at the time stock options are granted. As of September 30, 2024, a total of 55,223,113 common shares were outstanding. As of September 30, 2024, the maximum number of stock options eligible to be issued under the Plan would be 5,522,311 and net of 4,473,334 options outstanding as of September 30, 2024, there remain 1,048,977 stock options available to be issued under the Plan. Shareholder Rights Plan On May 24, 2023, the Company adopted and on June 29, 2023, the shareholders approved a shareholder rights plan, which is designed to ensure the fair treatment of shareholders in connection with any take-over bid for the Company and to provide the Board of Directors and shareholders with sufficient time to fully consider any unsolicited takeover bid (the “Shareholder Rights Plan”). The Shareholder Rights Plan also provides the Board of Directors with time to pursue, if appropriate, other alternatives to maximize shareholder value in the event of a takeover bid. Pursuant to the terms of the Shareholder Rights Plan subject to a triggering event as defined in the Shareholder Rights Plan and as determined by the Board of Directors, rights (the “Rights”) will be issued to holders of Common Shares at a rate of one Right for each Share outstanding. 15 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 6 - SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS, CONTINUED Stock Options During the nine months ended September 30, 2024, the Company issued 22,484 shares of common stock pursuant to the cashless exercise of 41,666 stock options with an exercise price of $ 0.79 (CAD $ 1.03 ). During the nine months ended September 30, 2024, the Company granted a stock option to a director for the purchase of 100,000 shares of common stock with a weighted average grant date fair value of $ 0.80 per share. The Company utilized the Black-Scholes option pricing model to determine the fair value of this grant, using the assumptions as outlined below: For the Nine Months Ended September 30, 2024 Stock price CAD $ 2.00 Exercise price CAD $ 2.00 Dividend yield 0 % Expected volatility 79.1 % - 88.0 % Weighted average risk-free interest rate 4.22 % Expected life (in years) 2.55 - 3.05 There were no stock options granted during the nine months ended September 30, 2023. Number of Shares Weighted Average Exercise Price Weighted Average Contractual Life (Years) Intrinsic Value Outstanding – January 1, 2024 4,917,666 $ 1.22 3.85 $ 214,875 Granted 100,000 1.47 Forfeited and expired ( 502,666 ) 1.50 Exercised ( 41,666 ) 0.79 Outstanding – September 30, 2024 4,473,334 $ 1.19 3.40 $ 1,057,764 Exercisable – September 30, 2024 3,948,326 $ 1.19 3.14 $ 952,300 The Company’s stock-based compensation expense (net of effect of forfeitures) related to stock options for the three months ended September 30, 2024 was $ 149,038 of which ($ 3,918 ) and $ 152,956 was included in mining expenditures and general and administrative expenses, respectively, on the Company’s condensed interim consolidated statements of operations and other comprehensive loss. The Company’s stock-based compensation expense related to stock options for the three months ended September 30, 2023 was $ 0 . The Company’s stock-based compensation expense related to stock options for the nine months ended September 30, 2024 was $ 893,688 , of which $ 203,607 and $ 690,081 was included in mining expenditures and general and administrative expenses, respectively, on the Company’s condensed interim consolidated statements of operations and other comprehensive loss. The Company’s stock-based compensation expense related to stock options for the nine months ended September 30, 2023 was $ 350,900 , of which $ 57,417 and $ 293,483 was included in mining expenditures and general and administrative expenses, respectively, on the Company’s condensed interim consolidated statements of operations and other comprehensive loss. As of September 30, 2024, there was approximately $ 130,928 of unrecognized share-based compensation for unvested stock option grants, which is expected to be recognized over a weighted average period of 0.34 years. Warrants Number of Shares Weighted Average Exercise Price Weighted Average Contractual Life (Years) Intrinsic Value Outstanding – January 1, 2024 10,804,539 $ 1.30 1.31 $ 1,576,511 Issued - - Exercised ( 5,198,540 ) 0.88 Expired/Forfeited ( 27,260 ) 0.88 Outstanding – September 30, 2024 5,578,739 $ 1.61 1.65 $ 38,090 Exercisable – September 30, 2024 5,578,739 $ 1.61 1.65 $ 38,090 16 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) Note 7- Mining Expenditures For the Three Months Ended September 30, For the Nine Months Ended September 30, 2024 2023 2024 2023 Mining costs $ 614,454 $ 421,064 $ 1,967,452 $ 1,042,186 Permits 28,267 26,662 91,904 81,340 Labor and related benefits 523,622 280,704 1,795,517 863,958 Royalties - 2,424 5,300 5,019 Total mining expenses $ 1,166,343 $ 730,854 $ 3,860,173 $ 1,992,503 Joint Venture During February 2024, PRM entered into a joint venture agreement with Rimrock Exploration and Development Inc. (“Rimrock”) to explore, develop and mine (the “Mining Operations”) certain uranium and vanadium permitted mines and mining claims located in Colorado and owned by Rimrock (the “JV”). Pursuant to the terms of the JV, Rimrock will contribute certain assets into the JV and PRM will contribute $ 200,000 (the “Initial Contribution”) to be used to fund the Mining Operations. Thereafter, each party will own a 50 % interest in the assets of the JV. During the initial phase of the JV, Rimrock will be the operator and the permits and licenses for the operator will remain in the name of Rimrock. The JV intends to sell the mined material to the Company under terms to be determined. During the term of the JV, PRM will pay the costs of the Mining Operations and will be entitled to recover 50 % of such costs subsequent to the contribution of the full amount of the Initial Contribution. The JV will fund the recovery payments to be made to PRM from the proceeds of the sale of mined material. During the three and nine months ended September 30, 2024, PRM funded $ 55,643 and $ 234,192 to the JV, respectively, which was expensed to mining expenditures within the condensed interim consolidated statements of operations and other comprehensive loss and reflected within mining cost in the table above. The Company has completed its earn-in through the Initial Contribution and now owns a 50 % interest in the assets of the JV. NOTE 8 - Related Party Transactions AND BALANCES The Company has transacted with related parties pursuant to service arrangements in the ordinary course of business, as follows: Prior to the acquisition of Black Range, Mr. George Glasier, the Company’s CEO, who is also a director of the Company (“Seller”), transferred his interest in a former joint venture with Ablation Technologies, LLC to Black Range. In connection with the transfer, Black Range issued 25 million shares of Black Range common stock to Seller and committed to pay $ 346,820 (AUD $ 500,000 ) to Seller within 60 days of the first commercial application of the Kinetic Separation technology. The Company assumed this contingent payment obligation in connection with the acquisition of Black Range. At the date of the acquisition of Black Range, this contingent obligation was determined to be probable. Since the deferred contingent consideration obligation is probable and the amount is estimable, the Company recorded the deferred contingent consideration as an assumed liability in the amount of $ 346,820 and $ 340,650 as of September 30, 2024 and December 31, 2023, respectively. The Company has multiple lease arrangements with Silver Hawk Ltd., an entity which is owned by George Glasier and his wife Kathleen Glasier. These leases, which are all on a month-to-month basis, are for the rental of office, workshop, warehouse and employee housing facilities. The Company incurred rent expense of $ 26,325 and $ 17,925 in connection with these arrangements for the three months ended September 30, 2024 and 2023, respectively. The Company incurred rent expense of $ 76,175 and $ 53,775 in connection with these arrangements for the nine months ended September 30, 2024 and 2023, respectively. The Company is obligated to pay Mr. Glasier for reimbursable expenses in the amount of $ 23,832 and $ 50,010 , included within accounts payable and accrued liabilities, as of September 30, 2024 and December 31, 2023, respectively. During the nine months ended September 30, 2024 and 2023, the Company purchased approximately $ 9,000 and $ 25,800 of mining related equipment from Silver Hawk Ltd, respectively. See Note 9 - Subsequent Events. 17 WESTERN URANIUM & VANADIUM CORP. AND SUBSIDIARIES NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Stated in USD) (Unaudited) NOTE 9 – Subsequent events Purchase of Colorado Mill Site On October 1, 2024, Western, through its wholly owned subsidiary, Western Uranium Corporation, executed a binding Stock Purchase Agreement (the “PRC Agreement”) to purchase 100 % of the shares of Pinon Ridge Corporation, a Colorado corporation (“PRC”), from a private investor group and thereby acquire Pinion Ridge Resources Corporation (“PRRC”), which is a wholly owned subsidiary of PRC. PRRC owns an approximately 900 -acre property located in Montrose County, Colorado, where a uranium processing mill was previously licensed but never constructed. While the mill was never constructed, it was fully licensed and thus provides leverage from past expenditures unique to this specific site supporting the permitting process. The acquisition becomes the second property package that Western has acquired, in addition to the Maverick Minerals Processing Plant site in Utah, and is part of Western’s plans for developing and licensing one or more uranium and vanadium processing facilities to process production from its resource properties in Colorado and Utah. Pursuant to the PRC Agreement, the former PRC shareholders were paid $ 829,167 for their PRC equity and shareholder loan repayments. As of October 3, 2024, Western has completed all such payments and the transaction has closed. After closing, a creditor holding a security interest against PRRC was paid a total of $ 1,148,125 to pay off an outstanding promissory note. Western also assumed certain PRC liabilities and obligations in the transaction, including royalty obligations payable to an unrelated third party based upon the mineral volume processed through any mineral processing plant that is located on the property. The transaction will be accounted for as a purchase of an asset. George Glasier, the President, CEO and a director of Western, and his wife Kathleen owned 50 % of the shares of PRC, and Andrew Wilder, a director of Western, indirectly owned 3 % of the shares of PRC, and so the transaction was considered a related party transaction. The Company’s Board of Directors established an independent committee of the Board comprised of directors who were not considered to have an interest in the transaction, and the independent committee oversaw the negotiation and approved the entering into the Agreement on behalf of the Company. Of the total cash paid to the sellers, approximately $ 414,000 was paid to George Glasier and approximately $ 24,000 was paid to an affiliate of Andrew Wilder. November 2024 Private Placement On November 8, 2024, the Company announced a private placement of up to 4,166,666 units at a price of CAD $ 1.32 per unit, which if fully subscribed would result in aggregate gross proceeds of up to approximately CAD $ 5,500,000 , subject to a 15 % discretionary overallotment increase. Each unit is comprised of one common share of Western and one common share purchase warrant. Each warrant is exercisable into one common share at a price of CAD $1.78 per share for a period of four years following the closing date of the private placement. This private placement is expected to close on November 15, 2024. 18