<PAGE> 1
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
URANIUM RESOURCES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a6(i)(1) or 14a-6(i)(2)
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:_/
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(4) Proposed maximum aggregate value of transaction:
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_/ Set forth the amount on which the filing fee is calculated and
state how it was determined
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
URANIUM RESOURCES, INC.
12750 MERIT DRIVE, SUITE 1020
DALLAS, TEXAS 75251
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 1, 1997
To the Stockholders of
URANIUM RESOURCES, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Uranium
Resources, Inc., a Delaware corporation (the "Company"), will be held in the
Alamo Room of the Landmark Club, 12740 Merit Drive, Dallas, Texas 75251 on
Thursday, May 1, 1997, at 9:00 a.m., local time, for the following purposes:
1. To elect four (4) directors of the Company to serve until the next
annual meeting of stockholders or until their respective successors shall be
elected and qualified;
2. To consider and vote upon a proposal to ratify the selection of Arthur
Andersen, LLP, independent accountants, as independent auditors for the Company
for the fiscal year ending December 31, 1997; and
3. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 20, 1997,
are entitled to notice of and to vote at the Meeting or any adjournment
thereof.
STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE MEETING, YOU ARE REQUESTED TO SIGN
AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE SO THAT YOUR SHARES MAY
BE VOTED IN ACCORDANCE WITH YOUR WISHES AND IN ORDER THAT THE PRESENCE OF A
QUORUM MAY BE ASSURED. THE GIVING OF SUCH PROXY WILL NOT AFFECT YOUR RIGHT TO
VOTE IN PERSON, SHOULD YOU LATER DECIDE TO ATTEND THE MEETING. PLEASE DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. YOUR
VOTE IS IMPORTANT.
By Order of the Board of Directors
/s/ Thomas H. Ehrlich
Thomas H. Ehrlich, Secretary
DALLAS, TEXAS
March 26, 1997
<PAGE> 3
URANIUM RESOURCES, INC.
12750 MERIT DRIVE, SUITE 1020
DALLAS, TEXAS 75251
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 1, 1997
This Proxy Statement is furnished to stockholders of Uranium Resources,
Inc., a Delaware corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors of the Company for use at the
Annual Meeting of Stockholders (the "Meeting") to be held in the Alamo Room of
the Landmark Club, 12740 Merit Drive, Dallas, Texas 75251 on Thursday, May 1,
1997, at 9:00 a.m., local time, for the purposes set forth in the accompanying
Notice of Annual Meeting of Stockholders. The approximate date on which this
Proxy Statement and the enclosed Proxy will first be sent to stockholders is
March 31, 1997.
ACTION TO BE TAKEN AT THE MEETING
Shares represented by a properly executed Proxy, unless the stockholder
otherwise instructs in the Proxy, will be voted (a) for the election of the
four individuals named below under the caption Election of Directors as
directors of the Company; (b) for the ratification of the selection of Arthur
Andersen, LLP, independent accountants, as independent auditors of the Company
for the fiscal year ending December 31, 1997; and (c) at the discretion of the
Proxy holders on any other matter or business that may be properly presented at
the Meeting or any adjournment thereof. Where a stockholder properly executes a
Proxy and gives instructions on how his shares are to be voted, the shares will
be voted in accordance with those instructions.
A Proxy may be revoked at any time by a stockholder before it is exercised
by giving written notice to the Secretary of the Company, or by signing and
delivering a Proxy which is dated later, or, if the stockholder attends the
Meeting in person, by either notice of revocation to the inspectors of election
at the Meeting or by voting at the Meeting.
The only matters that management intends to present at the Meeting are the
two matters referenced in subparagraphs (a) and (b) above. If any other matter
or business is properly presented at the Meeting, the proxy holders will vote
upon it in accordance with their best judgment.
<PAGE> 4
VOTING SECURITIES
The record date for the Meeting is March 20, 1997. Only stockholders of
record at the close of business on that date will be entitled to vote at the
Meeting. At the close of business on that date, there were issued and
outstanding 10,827,527 shares of the Company's Common Stock entitled to one
vote per share. In the election of directors, cumulative voting is not allowed.
A majority of the outstanding Common Stock, present in person or by Proxy and
entitled to vote, will constitute a quorum for the transaction of business at
the Meeting. Under Delaware law and the Company's Bylaws, if a quorum is
present at the Meeting: (i) to be elected a director, each nominee must receive
a plurality of the votes of the shares present in person or by Proxy at the
Meeting and entitled to vote on the matter, and (ii) the affirmative vote of
the majority of shares present in person or by Proxy at the Meeting and
entitled to vote on the matter is required to (a) ratify the selection of
Arthur Andersen, LLP, as independent auditors of the Company for the fiscal
year ending December 31, 1997, and (b) approve any other matter submitted to a
vote of stockholders at the Meeting. In the election of directors, any action
other than a vote for a nominee will have the practical effect of voting
against the nominee. Abstention from voting on any matter presented at the
Meeting will have the practical effect of voting against any such matter since
it is one less vote for approval. Broker non-votes on any matter will not be
considered "shares present" for voting purposes.
BENEFICIAL OWNERSHIP OF THE COMPANY'S COMMON STOCK
The following table sets forth, as of February 28, 1997, certain
information regarding persons known by the Company to be the beneficial owner
of more than 5% of the outstanding shares of the Company's Common Stock. Shown
separately in the second table below is certain information regarding the
beneficial ownership of the Company's Common Stock by (i) each director and
nominee for director of the Company, (ii) each of the executive officers named
in the Summary Compensation Table set forth below under the caption Executive
Compensation, and (iii) all directors and executive officers as a group.
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<PAGE> 5
PRINCIPAL STOCKHOLDERS
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) CLASS(2)
------------------- ----------------------- ----------
<S> <C> <C>
Barry R. Feirstein 1,000,000 9.2%
Feirstein Capital Management Corp.
767 Third Avenue, 28th Floor
New York, NY 10017
Lindner Growth Fund 811,525(3) 6.1%
7711 Carondelet Avenue, Suite 700
Clayton, MO 63105
Lindner Dividend Fund 2,589,000(3)(4) 19.4%
7711 Carondelet Avenue, Suite 700
Clayton, MO 63105
Lindner Bulwark Fund 829,300(3)(5) 6.2%
7711 Carondelet, Suite 700
Clayton, MO 63105
Ryback Management Corporation 250,000(6) 2.3%
7711 Carondelet Avenue, Suite 700
Clayton, MO 63105
Zeiger Capital Group LLC 884,600(7) 8.2%
320 Park Avenue, 30th Floor
New York, NY 10022
John A. Levin & Co., Inc. 681,300 6.3%
One Rockefeller Plaza, 25th Floor
New York, NY 10020
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</TABLE>
(1) Each person has sole voting and investment power with respect to the
shares listed, unless otherwise indicated. Beneficial ownership includes
shares over which the indicated beneficial owner exercises voting and/or
investment power.
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<PAGE> 6
(2) The shares owned by each person, and the shares included in the total
number of shares outstanding, have been adjusted, and the percentages
owned have been computed, in accordance with Rule 13d-3(d)(1) under the
Securities Exchange Act of 1934. Shares subject to options or warrants
currently exercisable or exercisable within 60 days are deemed outstanding
for computing the percentage ownership of the person holding such options
or warrants, but are not deemed outstanding for computing the percentage
ownership of any other person.
(3) Lindner Growth Fund, Lindner Dividend Fund, and Lindner Bulwark Fund
(the "Lindner Group") are members of the same family of mutual funds and
may be deemed collectively as a controlling stockholder of the Company.
The Lindner Group is managed by Ryback Management Corporation ("Ryback"),
an investment adviser. Ryback has discretionary authority over the shares
owned beneficially by the Lindner Group, including the power to vote and
dispose of such shares.
(4) Includes 839,000 outstanding shares owned beneficially by Lindner
Dividend Fund, 1,125,000 shares issuable upon conversion of certain notes
and 625,000 shares issuable upon exercise of certain warrants.
(5) Includes 375,000 shares issuable upon conversion of certain notes and
375,000 shares issuable upon exercise of certain warrants.
(6) Ryback manages the accounts of third parties that are not affiliated
with the Lindner Group. Such parties own beneficially 250,000 outstanding
shares over which Ryback has discretionary authority to vote and dispose
of such shares. Ryback disclaims beneficial ownership of these 250,000
shares. Excludes all the shares owned by the Lindner Group as to which
Ryback disclaims beneficial ownership.
(7) Zesiger Capital Group L.L.C. ("Zeiger") is an investment adviser with
dispositive power over 884,600 shares of the Company's common stock
pursuant to authority granted by its investment clients and disclaims
beneficial ownership of these shares. Legal and beneficial ownership of
these shares are held by Zesiger's clients.
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<PAGE> 7
MANAGEMENT
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME OF BENEFICIAL
BENEFICIAL OWNER OWNERSHIP(1) PERCENT OF CLASS(2)
---------------- --------- ------------------
<S> <C> <C>
William M. McKnight, Jr. 265,604(3) 2.3%
Paul K. Willmott 104,968(4) *
Joe H. Card 6,626(5) *
Leland O. Erdahl 112,250(6) *
George R. Ireland 124,250(7) 1.0%
James B. Tompkins 105,250(8) *
Richard F. Clement, Jr. 167,653(9) 1.5%
Harry L. Anthony, IV 35,388(10) *
All executive officers and directors
as a group (11 persons) 1,095,730(11) 9.5%
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</TABLE>
* Less than 1%.
(1) Each person has sole voting and investment power with respect to the
shares listed, unless otherwise indicated. Beneficial ownership includes
shares over which the indicated beneficial owner exercises voting and/or
investment power.
(2) The shares owned by each person, and the shares included in the total
number of shares outstanding, have been adjusted, and the percentages
owned have been computed, in accordance with Rule 13d-3(d)(1) under the
Securities Exchange Act of 1934. Shares subject to options currently
exercisable or exercisable within 60 days are deemed outstanding for
computing the percentage ownership of the person holding such options, but
not deemed outstanding for computing the percentage ownership of any other
person.
(3) Includes 70,620 shares that may be obtained by Mr. McKnight, through
the exercise of stock options which are currently exercisable or will
become exercisable within 60 days. Such number does not include 63,210
shares that may be obtained by Mr. McKnight through the exercise of stock
options exercisable more than 60 days from the date hereof.
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<PAGE> 8
(4) Includes 103,968 shares that may be obtained by Mr. Willmott through
the exercise of stock options which are currently exercisable. Does not
include 220,182 shares that may be obtained by Mr. Willmott through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(5) Includes 6,626 shares that may be obtained by Mr. Card through the
exercise of stock options which are currently exercisable. Does not
include 30,428 shares that may be obtained by Mr. Card through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(6) Includes 110,750 shares that may be obtained by Mr. Erdahl through the
exercise of stock options which are currently exercisable. Does not
include 12,250 shares that may be obtained by Mr. Erdahl through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(7) Includes 105,250 shares that may be obtained by Mr. Ireland through
the exercise of stock options which are currently exercisable. Does not
include 16,750 shares that may be obtained by Mr. Ireland through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(8) Includes 105,250 shares that may be obtained by Mr. Tompkins through
the exercise of stock options which are currently exercisable. Does not
include 16,750 shares that may be obtained by Mr. Tompkins through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(9) Includes 35,713 shares that may be obtained by Mr. Clement through the
exercise of stock options which are currently exercisable. Does not
include 122,987 shares that may be obtained by Mr. Clement through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(10) Includes 34,111 shares that may be obtained by Mr. Anthony through the
exercise of stock options which are currently exercisable. Does not
include 33,783 shares that may be obtained by Mr. Anthony through the
exercise of stock options exercisable more than 60 days from the date
hereof.
(11) Includes 598,880 shares that may be obtained through the exercise of
stock options which are currently exercisable or will become exercisable
within 60 days.
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<PAGE> 9
ELECTION OF DIRECTORS
(PROPOSAL 1 ON PROXY CARD)
Under the Company's Bylaws and pursuant to a resolution of the Board of
Directors, the Board of Directors has fixed the size of the Board at four.
Directors are elected to serve until the next annual meeting of stockholders or
until their successors are elected and qualified. The Company's Board of
Directors is not divided into classes; therefore, all four directors are to be
elected at the Meeting.
Unless authority is withheld, it is intended that the shares represented
by a properly executed Proxy will be voted for the election of all of the
nominees (Paul K. Willmott, Leland O. Erdahl, George R. Ireland and James B.
Tompkins) as directors. The nominees are currently all the members of the
Company's Board of Directors. If these nominees are unable to serve for any
reason, such Proxy will be voted for such persons as shall be designated by the
Board of Directors to replace such nominees. The Board of Directors has no
reason to expect that these nominees will be unable to serve.
The following table sets forth certain information concerning the
individuals nominated for election as directors of the Company:
<TABLE>
<CAPTION>
POSITIONS AND OFFICES
NAME AGE WITH THE COMPANY
---- --- ------------------
<S> <C> <C>
Paul K. Willmott 57 Chairman, Chief Executive Officer,
President, and Director
Leland O. Erdahl 68 Director
George R. Ireland 40 Director
James B. Tompkins 40 Director
</TABLE>
NOMINEES FOR DIRECTOR
PAUL K. WILLMOTT has served as a director of the Company since August
1994, as President of the Company since February 1995, as Chief Financial and
Accounting Officer from April 12, 1995 through September 25, 1995 and as
Chairman of the Board and Chief Executive Officer since July 31, 1995. Mr.
Willmott retired from Union Carbide Corporation ("Union Carbide") where he was
involved for 25 years in the finance and operation of Union Carbide's
world-wide mining and metals business. Most recently, Mr. Willmott was
President of UMETCO Minerals Corporation, a wholly-owned subsidiary of Union
Carbide, from 1987 to 1991, where he was responsible for Union Carbide's
uranium and vanadium businesses. From January 1993 until February 1995, Mr.
Willmott was engaged by the Concord Mining Unit as a senior vice president
where he was primarily involved in the acquisition of UMETCO Minerals
Corporation's uranium and vanadium
-7 -
<PAGE> 10
operating assets. Mr. Willmott graduated from Michigan Technological University
with a Bachelor of Science degree in Mining in 1964 and a Bachelor of Science
Degree in Engineering Administration in 1967. He has been an active member of
the American Institute of Mining Engineers, the Canadian Institute of Mining
Engineers and a number of state professional organizations.
LELAND O. ERDAHL has served as a director of the Company since July 11,
1994. Mr. Erdahl previously served as President and Chief Executive Officer for
Stolar, Inc. from 1986 to 1991. Stolar was a high-tech company involved in the
radio wave imaging of geologic media and underground radio transmission for
voice and data. He was also President and CEO of Albuquerque Uranium
Corporation, a Uranium mining company, from 1987 to 1991. He is a Certified
Public Accountant and is a graduate from the College of Santa Fe. He is
currently a director of Hecla Mining Company, Canyon Resources Corporation,
Original Sixteen to One Mine, Inc., and a trustee for a group of John Hancock
Mutual Funds. He is also a director of Santa Fe Ingredients Company of
California, Inc. and Santa Fe Ingredients Company, Inc., both private food
processing companies. In March 1997, Mr. Erdahl entered into a contract with
AMAX Gold, Inc. to serve as Vice President and Chief Financial Officer for a
period of six months.
GEORGE R. IRELAND has served as a director since May 25, 1995. Mr. Ireland
is a financial analyst for and a partner in the D.M. Knott Limited Partnership,
a private investment partnership. Mr. Ireland specializes in investing in
securities of natural resource and other basic industrial companies, both
domestically and abroad. From 1987 to 1991, he was a Vice President of Fulcrum
Management, Inc., which was the manager of the VenturesTrident Limited
Partnerships, (venture capital funds dedicated to investing in the mining
industry), and Senior Vice President and Chief Financial Officer of MinVed Gold
Corporation, a company in which the VenturesTrident funds had a significant
investment. Mr. Ireland graduated from the University of Michigan with degrees
in Geology and Resource Economics. He also attended the Graduate School of
Business Administration of New York University. Mr. Ireland is a director of
Merrill & Ring, Inc., a private land and timber holding company in the state of
Washington. Mr. Ireland acted as a consultant to Ryback Management Corporation
and performed due diligence on the Company in connection with Ryback's loan of
$6 million to the Company on behalf of members of the Lindner Group in 1995
discussed elsewhere in this Proxy Statement. Mr. Ireland is not otherwise
affiliated with the Lindner Group or Ryback.
JAMES B. TOMPKINS has served as a director since May 25, 1995. Mr.
Tompkins is a registered investment advisor doing business as Tompkins &
Company. From 1988 until 1990, Mr. Tompkins acted as a sole proprietor of
Tompkins & Company, advising creditors of companies in bankruptcy as to the
value of claims and realizing proceeds on those claims. In that capacity, Mr.
Tompkins acted as a registered investment advisor. Between October 1990 and
April 1993, Mr. Tompkins was employed by Columbia Savings as a bond manager
where he was responsible for real estate loan workouts and asset disposition.
He is an attorney and a Chartered Financial Analyst. Mr. Tompkins graduated
from the University of Alabama in 1979 and received his Juris Doctor from the
University of Alabama School of Law in 1983. Mr. Tompkins acted as a
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<PAGE> 11
consultant to Ryback and performed due diligence on the Company in connection
with Ryback's loan of $6 million to the Company on behalf of members of the
Lindner Group in 1995 as discussed elsewhere in this Proxy Statement. Mr.
Tompkins is not otherwise affiliated with the Lindner Group or Ryback.
ARRANGEMENTS REGARDING ELECTION OF DIRECTORS
On May 25, 1995, George R. Ireland and James B. Tompkins were appointed to
the Board of Directors following the closing of certain transactions with the
Lindner Group. In connection with these transactions, the Company has agreed to
nominate two individuals designated by the Lindner Group for election to the
Board. Messrs. Ireland and Tompkins are the Lindner Group's designees.
LEGAL PROCEEDINGS
On August 28, 1995, Manuel T. Longoria, as owner of the ranch containing
the site of the Company's Longoria mine near Bruni in Duval County, Texas,
brought suit against the Company in state district court in Duval County, Texas
asserting claims said to have arisen at various times over the last 18 years.
In the action styled Longoria v. Uranium Resources, Inc., et al., Longoria
claims the Company has leased the site knowing that the proposed mining would
contaminate the site; that the Company had knowingly or negligently conducted
mining operations in a manner which contaminated the Longoria property with
toxic and hazardous material which present a serious health hazard. The suit
asks for remediation of the Longoria property and for unspecified actual and
punitive damages.
With regard to the claim for remediation, the Company, upon the conclusion
of mining at the Longoria site and the nearby sites, began reclamation in the
manner required by its permits and by state and federal regulations. Such
reclamation is nearing completion.
The Company has made provisions for the costs of site reclamation and does
not believe the settlement of this lawsuit will result in damages that are
materially different than the costs already in the financial statements.
On July 12, 1995, the Company filed a lawsuit in the federal district
court in Colorado against Professional Bank, a Colorado chartered bank
("ProBank"). The Company believes that ProBank is owned or controlled by Oren
L. Benton, the former Chairman of the Company's Board of Directors. In the
action styled Uranium Resources, Inc. v. Professional Bank, the Company alleges
that ProBank transferred $1,080,000, without the Company's authorization, from
the Company's account at ProBank to the accounts maintained at ProBank of
various entities and an individual affiliated with Mr. Benton. The Company has
recovered $300,000 of the total and is seeking to recover the balance from
ProBank.
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<PAGE> 12
The Company is subject to periodic inspection by the TNRCC for the purpose
of determining compliance by the Company with the conditions of its licenses.
In the ordinary course of business, minor violations may occur, however, these
are not expected to cause material expenditures.
OTHER EXECUTIVE OFFICERS
The following table sets forth certain information concerning executive
officers who are not also directors of the Company:
<TABLE>
<CAPTION>
POSITIONS AND OFFICES
NAME AGE WITH THE COMPANY
---- --- -----------------
<S> <C> <C>
William M. McKnight, Jr. 60 Senior Vice President - Operations (1)
Joe H. Card 43 Senior Vice President - Marketing
Richard F. Clement, Jr. 53 Senior Vice President and
President-Hydro Resources, Inc.
Richard A. Van Horn 50 Senior Vice President - Operations (2)
Thomas H. Ehrlich 37 Vice President, Chief Financial Officer, Secretary and
Treasurer
Harry L. Anthony, IV 49 Vice President - Engineering
Mark S. Pelizza 44 Vice President - Health, Safety and
Environmental Affairs
Craig S. Bartels 48 Vice President, Technology - Hydro Resources, Inc.
</TABLE>
________________________________
(1) Mr. McKnight has announced that effective March 31, 1997, he will retire
as an officer and a full-time employee of the Company. He will continue to
remain as a resource to the Company through his role as a part-time
employee or as a consultant to the Company.
(2) Effective April 1, 1997, Mr. Van Horn was elected an officer of the
Company.
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<PAGE> 13
The following sets forth certain information concerning the business
experience of the foregoing executive officers during the past five years.
WILLIAM M. MCKNIGHT, JR. joined the Company on September 1, 1977 and
served as the Company's Executive Vice President, Chief Operating Officer and
Director until August 1994. From August 1994 to February 1995, he directed the
Company's operations in South Texas and New Mexico and on February 24, 1995, he
was appointed Vice President of Operations for the Company. In February 1996,
he was appointed Senior Vice President of Operations. Mr. McKnight received a
B.S. in Geology from Centenary College in 1959 and a M.S. in Sedimentary
Geology from Florida State University in 1961.
JOE H. CARD joined the Company as Vice President - Marketing in March
1989. In February 1993 he was promoted to Senior Vice President - Marketing.
Previously, he spent four years with UG U.S.A., Inc., a U.S. marketing
subsidiary of a major German mining company, most recently as Marketing
Manager. His responsibilities were related to the entire Uranium fuel cycle,
primarily in dealing with U.S. nuclear utilities customers. Prior to his work
at UG U.S.A., Inc., Mr. Card spent five years with Mitsubishi International
Corporation as marketing manager. He earned a B.B.A. degree in Finance from the
University of Georgia in 1975 and an M.B.A. from Georgia State University in
1978.
RICHARD F. CLEMENT, JR. joined the Company as Vice President-Exploration
in 1983. In April 1990, he was appointed Senior Vice President-Exploration. Mr.
Clement was a director of the Company from February 1985 to July 1994 at which
time he resigned his positions as director and officer of the Company. During
the period from July 1994 to February 1996 Mr. Clement remained with the
Company as Exploration Manager. In February 1996, he was again appointed Senior
Vice President-Exploration of the Company as well as the President and a
Director of Hydro Resources, Inc., a wholly owned subsidiary of the Company.
Prior to joining the Company, he spent 16 years with Mobil Oil Corporation,
most recently as vice president and exploration manager for Mobil Energy
Minerals-Australia, where he initiated and managed Mobil's Australian coal,
uranium and other minerals exploration and acquisition programs. Mr. Clement
received his B.S. degree in Geology from Boston College in 1965 and his M.S.
degree in Geology from the University of Vermont in 1967.
RICHARD A. VAN HORN joined the Company in March 1997 and assumed the
position of Senior Vice President of Operations on April 1, 1997. Previously,
he spent three years with Energy Fuels Nuclear, Inc. as General Manager -
Colorado Plateau Operations with responsibility for the daily management of and
planning for Energy Fuels Nuclear, Inc. mining activities on the Colorado
Plateau. Prior to his work at Energy Fuels Nuclear, Inc., Mr. Van Horn spent
eighteen years with Union Carbide Corporation where he was involved with the
finance and operation of the company's world-wide mining and metals business.
From 1990 to 1994, Mr. Van Horn was Director of Operations of UMETCO Minerals
Corporation, a wholly owned subsidiary of Union Carbide Corporation,
responsible for all operating aspects of UMETCO's uranium and vanadium
-11 -
<PAGE> 14
business on the Colorado Plateau prior to its sale to Energy Fuels Nuclear,
Inc.. Mr. Van Horn graduated from the Colorado School of Mines with a Engineer
of Mines degree in mining in 1973.
THOMAS H. EHRLICH, a certified public accountant, rejoined the Company in
September 1995 as Vice President and Chief Financial Officer and was appointed
Secretary and Treasurer of the Company in December 1995. Immediately prior to
that, Mr. Ehrlich spent nine months as a Division Controller with Affiliated
Computer Services, Inc., an information technology services provider in Dallas,
Texas. Prior to that, he joined the Company in November 1987 as Controller-
Public Reporting and was promoted to Controller and Chief Accounting Officer in
February 1990. In February 1993, Mr. Ehrlich assumed the additional duties of
Vice President and Secretary of the Company. Prior to joining the Company, he
spent four years with Deloitte Haskins & Sells and worked primarily with
clients that were publicly held companies. Prior to his work at Deloitte
Haskins & Sells, he spent three years in various accounting duties at Enserch
Exploration, Inc., an oil and gas company in Dallas, Texas. Mr. Ehrlich
received his B.S. B.A. degree in Accounting from Bryant College in 1981.
HARRY L. ANTHONY, IV has headed the Company's engineering team since 1978.
From April 1978 until April 1990, Mr. Anthony was Vice President - Engineering
of the Company, and in April 1990, he was appointed Senior Vice President-
Engineering. Mr. Anthony was a director of the Company from February 1985 to
July 1994 at which time he resigned his positions as director and officer of
the Company. During the period from July 1994 to February 1996, Mr. Anthony
remained with the Company as Engineering Manager. In February 1996, he was
appointed Vice President-Engineering of the Company. Prior to joining the
Company he was employed for eight years by Union Carbide, six of such years as
a hydrometallurgist and the last two years as plant superintendent for Union
Carbide's Palangana solution mining plant in South Texas. Mr. Anthony received
a B.S. degree and a M.S. degree in Engineering Mechanics from Pennsylvania
State University in 1969 and 1973, respectively.
MARK S. PELIZZA has served as the Company's Environmental Manager since
1980, and as such, he has been responsible for all environmental regulatory
activities. In February 1996, he was appointed Vice President - Health, Safety
and Environmental Affairs of the Company. Prior to joining the Company, he was
employed for two years by Union Carbide as an Environmental Planning Engineer
at Union Carbide's Palangana solution mining plant in South Texas. Mr. Pelizza
received a M.S. Degree in Engineering Geology from Colorado School of Mines in
1978 and a B.S. Degree in Geology from Fort Lewis College in 1974.
CRAIG S. BARTELS, a Registered Professional Engineer, rejoined the Company
as Vice President-Technology of Hydro Resources, Inc., a wholly owned
subsidiary of the Company in July 1996. From January 1995 to July 1996, he was
Manager of Wellfield Operations for Crow Butte Resources, Inc. a uranium ISL
mining company. Mr. Bartels originally joined the Company in early 1981 and
held varied positions with the Company as Reservoir Engineer, Plant Manager,
and Manager of Wellfield Operations through October 1994. Earlier, he was with
Union Carbide, eventually becoming Technical and Plant Superintendent for their
solution mining operation.
-12 -
<PAGE> 15
Mr. Bartels also spent six years with Natural Gas Pipeline Company of America,
a major gas transmission company, as drilling and reservoir engineer for their
gas storage operations. Mr. Bartels received a B.S. Degree in Petroleum
Engineering from Montana School of Mines in 1972.
The officers of the Company hold office until their successors are
appointed by the Board of Directors. All officers of the Company are employed
on a full-time basis. There is no family relationship between any director and
executive officer of the Company.
BOARD AND COMMITTEE MEETINGS
The Board of Directors held 11 formal meetings through both direct
meetings and telephonic meetings during the year ended December 31, 1996. Each
director attended all of the meetings except for Leland O. Erdahl who did not
attend the April 18 meeting but met with Mr. Willmott on April 19, 1996 to
review and vote upon the actions taken the previous day. In addition to those
meetings, certain actions were taken by unanimous written consent of the Board
of Directors. The Company's officers have made a practice of keeping directors
informed of corporate activities by personal meetings and telephone discussions
and (as indicated above) directors ratify or authorize certain Company actions
through unanimous written consent actions.
The Company has three standing committees of the Board of Directors.
Leland O. Erdahl, George R. Ireland and James B. Tompkins are the current
members of the Audit, the Employees' Stock Option, and Compensation Committees.
The Audit Committee's principal functions are to meet with the Company's
independent auditors to review the financial statements contained in the Annual
Report, to review the Company's systems of internal controls and to report to
the Board of Directors thereon. The Employees' Stock Option Committee's
principal function is the administration of the employees' stock option plans
of the Company. The Compensation Committee's function is to determine the
compensation of executive officers and to set guidelines for compensation for
the employees of the Company.
During 1996, the Audit Committee held three formal meetings, the
Employees' Stock Option Committee held two formal meetings, and the
Compensation Committee held three formal meetings. The Audit Committee met in
February 1997 with the Company's auditors to review the 1996 fiscal year audit.
At present, the Company has no nominating, executive, or similar
committees.
-13 -
<PAGE> 16
EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to annual
and long-term compensation for services in all capacities for the years ended
December 31, 1996, 1995 and 1994 paid to the Company's Chief Executive Officers
and certain other executive officers of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
- ------------------------------------------------------------------------------------------------------------------------
Other Securities All
Annual Underlying Other
Salary Bonus Compensation(1) Options Compensation (2)
Name and Principal Position Year ($) ($) ($) (#) ($)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Paul K. Willmott 1996 $166,525 $13,140 $ 168 37,670 $ 2,851
Chairman, President and 1995 $118,324 $10,500 $ 3,209 240,200 $25,000
Chief Executive Officer 1994 -- -- -- 21,000 --
- ------------------------------------------------------------------------------------------------------------------------
Joe H. Card 1996 $117,894 $10,500 $145,729 13,440 $ 1,730
Senior Vice President - 1995 $121,619 $ 6,750 $137,461 6,064 --
Marketing 1994 $120,441 -- $ 36,617 -- --
- ------------------------------------------------------------------------------------------------------------------------
William M. McKnight, Jr. 1996 $139,632 $ 8,050 $ 168 28,880 $ 4,105
Senior Vice President - 1995 $165,959 $10,700 $ 542 33,600 $ 3,673
Operations 1994 $190,306 -- $ 168 -- $ 3,549
- ------------------------------------------------------------------------------------------------------------------------
Harry L. Anthony, IV 1996 $110,115 $ 7,950 $ 79,107 14,520 $ 3,347
Vice President - 1995 $118,799 $ 7,275 $ 5,340 19,924 $ 2,310
Engineering 1994 $120,252 -- $ 3,332 -- $ 2,310
- ------------------------------------------------------------------------------------------------------------------------
Richard F. Clement, Jr.(3) 1996 $125,247 $ 10,000 $ 2,462 91,130 $13,129
Senior Vice President - 1995 $117,302 $ 8,100 $ 1,989 27,720 $ 2,310
Exploration/President - 1994 $120,744 -- $ 1,766 -- $ 2,310
Hydro Resources, Inc.
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents amounts paid for out-of-pocket medical and dental expenses
under the Company's Supplemental Health Care Plan; 1996 amounts for (i)
Mr. Card includes $141,550, constituting the difference between the fair
market value of the shares of Common Stock on the date of exercise of
certain stock options ($191,530) and the exercise price of $2.94 and for
(ii) Mr. Anthony includes $67,543, constituting the difference between the
fair market value of the shares of Common Stock on the date of exercise of
certain stock options ($105,763) and the exercise price of $2.94.
-14 -
<PAGE> 17
(2) Represents contributions made by the Company under the Company's 401(k)
Profit Sharing Plan (see "401(k) Profit Sharing Plan" below) and for Mr.
Clement in 1996 includes moving costs received upon his relocation to
Albuquerque ($9,868).
(3) Mr. Clement was appointed Senior Vice President-Exploration as well as
President and Director of Hydro Resources, Inc. effective February 22,
1997.
SUPPLEMENTAL HEALTH CARE PLAN
The Company has adopted a health care plan (the "Supplemental Plan") for
the officers of the Company and certain of the employees of the Company who are
also stockholders, which supplements the standard health care plan available to
all eligible employees of the Company (the "Standard Plan"). The Supplemental
Plan pays directly to the participant all out- of-pocket medical and dental
expenses not covered under the Standard Plan, including deductibles and
co-insurance amounts. Additionally, the Supplemental Plan provides to each
participant $100,000 of accidental death and dismemberment insurance protection
and a world wide medical assistance benefit. Each participant in the
Supplemental Plan may receive a maximum annual benefit of $50,000 or $100,000,
at the Company's option. The Company pays an annual premium under the
Supplemental Plan equal to $210 per participant plus 10% of claims paid. There
are currently ten officers and employees covered by the Supplemental Plan.
401(k) PROFIT SHARING PLAN
The Company maintains a defined contribution profit sharing plan for
employees of the Company (the "401(k)") that is administered by a committee of
trustees appointed by the Company. All Company employees are eligible to
participate upon the completion of six months of employment, subject to minimum
age requirements. Each year the Company makes a contribution to the 401(k) out
of its current or accumulated net profits (as defined) in an amount determined
by the Board of Directors but not exceeding 15% of the total compensation paid
or accrued to participants during such fiscal year. The Company's contributions
are allocated to participants in amounts equal to 25% (or a higher percentage,
determined at the Company's discretion) of the participants' contributions, up
to 4% of each participant's gross pay. For the plan year ended July 31, 1996
the Company contributed amounts equal to 75% of the participant's
contributions, up to 4% of gross pay. For the plan year ended July 31, 1995,
the Company contributed amounts equal to 50% of the participants' contribution,
up to 4% of gross pay. For the plan year ended July 31, 1994, the Company
contributed amounts equal to 50% of the participants' contributions, up to 4%
of gross pay. Participants become 20% vested in their Company contribution
account for each year of service until full vesting occurs upon the completion
of five years of service. Distributions are made upon retirement, death or
disability in a lump sum or in installments.
-15 -
<PAGE> 18
STOCK OPTION PLANS
On December 19, 1995, the Company's Shareholders approved the 1995 Stock
Incentive Plan (the "1995 Plan") for key employees of the Company. The 1995
Plan authorized grants of incentive stock options and non-qualified options to
purchase up to an aggregate of 750,000 shares of Common Stock. The Employees'
Stock Option Committee of the Board of Directors is responsible for the
administration of the 1995 Plan and has the full authority, subject to the
provisions of the plan, to determine to whom and when to grant options and the
number of shares of Common Stock covered by each grant. As of February 28,
1997, a total of 521,215 shares are reserved for issuance upon exercise of
options granted under the 1995 Plan and 228,785 shares were reserved for
exercise upon the future grant of options under the 1995 Plan.
The 1995 Plan replaced the Company's previous plan maintained for
employees under which the Company was authorized to grant non-qualified
options. All outstanding options under that plan will remain in effect but no
new options will be granted under that plan. As of February 28, 1997, a total
of 467,631 shares are reserved for issuance under that plan.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information with respect to options
granted to the executive officer named in the Summary Compensation Table in the
fiscal year ended December 31, 1996.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE
AT ASSUMED ANNUAL RATES
OF STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM
- ----------------------------------------------------------------------------------------------------------
NUMBER PERCENT OF
OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE
OPTIONS EMPLOYEES OR BASE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#) YEAR ($/SH) DATE 5% ($) 10% ($)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Paul K. Willmott 37,670 12% $ 9.75 02/22/06 $ 598,200 $ 953,051
- ----------------------------------------------------------------------------------------------------------
Joe H. Card 13,440 4% $ 9.75 02/22/06 $ 230,578 $ 367,356
- ----------------------------------------------------------------------------------------------------------
William M. McKnight, Jr. 28,880 10% $ 9.75 02/22/06 $ 458,614 $ 730,664
- ----------------------------------------------------------------------------------------------------------
Harry L. Anthony, IV 14,520 5% $ 9.75 02/22/06 $ 230,578 $ 367,356
- ----------------------------------------------------------------------------------------------------------
Richard F. Clement, Jr. 16,130 5% $ 9.75 02/22/06 $ 256,144 $ 408,089
75,000 25% $16.13 05/30/06 $1,971,000 $3,137,250
- ----------------------------------------------------------------------------------------------------------
</TABLE>
-16 -
<PAGE> 19
EXERCISE OF STOCK OPTIONS AND YEAR-END VALUE
The following sets forth information with respect to each exercise of
stock options during the fiscal year ended December 31, 1996 and the year-end
value of unexercised options held by each of the executive officers named in
the Summary Compensation Table.
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED
SHARES UNDERLYING IN-THE-MONEY
ACQUIRED VALUE UNEXERCISED OPTIONS OPTIONS AT FISCAL
ON REALIZED AT FISCAL YEAR END YEAR-END
NAME EXERCISE (#) ($) (#) ($)
---------- -------------- --------- ------------ -----------
EXERCISABLE/ EXERCISABLE/
UNEXERCISABLE UNEXERCISABLE
------------- -------------
<S> <C> <C> <C> <C>
Paul K. Willmott (1) -- -- 25,000/75,000 $93,625/$280,875
25,000/75,000 *
10,050/30,150 10,000/29,999
0/37,670 *
9,000/10,000 32,625/36,250
500/500 998/998
Harry Anthony, IV (2) 13,000 $67,543 25,500/0 $125,843/$0
4,981/14,943 4,956/14,868
0/14,520 *
Joe H. Card (2) 17,000 $141,550 1,750/0 $8,636/$0
1,516/4,548 1,508/4,525
0/13,440 *
William M. McKnight, Jr. (2) -- -- 55,000/0 $271,425/$0
8,400/25,200 8,358/25,074
0/28,880 *
Richard F. Clement, Jr.(3) -- -- 24,750/0 $122,141/$0
6,930/20,790 6,895/20,686
0/16,130 *
0/75,000 *
</TABLE>
__________________________________________________________
* Represents an option whose grant price is above the December 31, 1996
closing price on the NASDAQ-NMS.
(1) Based on the closing price on the NASDAQ-NMS on December 31, 1996
($7.875) less the grant prices of $4.13, $8.38, $6.88, $9.75, $4.25 and
$5.88, respectively.
-17 -
<PAGE> 20
(2) Based on the closing price on the NASDAQ-NMS on December 31, 1996
($7.875) less the grant prices of $2.94, $6.88 and $9.75, respectively.
(3) Based on the closing price on the NASDAQ-NMS on December 31, 1996
($7.875) less the grant prices of $2.94, $6.88, $9.75 and $16.13,
respectively.
DIRECTOR COMPENSATION
Under the Company's Directors' Stock Option Plan ("Directors' Plan"), each
new non-employee director elected or appointed to the Board of Directors for
the first time shall be granted an option to purchase 20,000 shares of Common
Stock as of the date of such election or appointment and, upon the re-election
of a non-employee director at an annual meeting of the Company's stockholders,
such director will be granted an option to purchase an additional 1,000 shares
as of the date of such election. As of February 28, 1997, a total of 87,000
shares are reserved for issuance upon exercise of options granted under the
Directors' Plan and 62,000 shares were reserved for exercise upon the future
grant of options under the Directors' Plan. Mr. Erdahl holds options covering
23,000 shares under the Directors' Plan and each of Messrs. Ireland and
Tompkins holds options covering 22,000 shares under the Directors' Plan. Mr.
Willmott holds options covering 20,000 shares under the Directors' Plan. In
addition, Messrs. Ireland, Tompkins and Erdahl each hold options to purchase
100,000 shares of Common Stock. Those options were not granted under the
Directors' Plan. Cash compensation for 1996 to the non-employee directors was
paid at the rate of $3,000 per quarter plus $1,000 per meeting attended of the
Board and committees of the Board.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In August 1994, the Company formed a Compensation Committee to determine
the compensation of the executive officers and to set the guidelines for
compensation for the employees of the Company. During the fiscal year ended
December 31, 1996, the Compensation Committee was comprised of Leland O.
Erdahl, George R. Ireland and James B. Tompkins. No member of the Compensation
Committee has been or was during the fiscal year ended December 31, 1996 an
officer or employee of the Company or any of the Company's subsidiaries. In
addition, no member of the Compensation Committee during the fiscal year ended
December 31, 1996 had any relationship requiring disclosure under the caption
"Certain Relationships and Related Transactions." No executive officer of the
Company serves or served on the compensation committee of another entity during
the fiscal year ended December 31, 1996 and no executive officer of the Company
serves or served as a director of another entity who has or had an executive
officer serving on the Compensation Committee of the Company.
-18 -
<PAGE> 21
COMPENSATION COMMITTEE REPORT
Under rules established by the Securities and Exchange Commission, the
Company is required to provide certain information regarding the compensation
of its Chief Executive Officer and other executive officers whose salary and
bonus exceed $100,000 per year. Disclosure requirements include a report
explaining the rationale and considerations that lead to fundamental executive
compensation decisions. The following report has been prepared to fulfill this
requirement.
The Compensation Committee ("Committee") of the Board of Directors sets
and administers the policies that govern the annual compensation and long-term
compensation of executive officers of the Company. None of the members of the
Committee is currently an employee of the Company. The Committee makes all
decisions concerning compensation of all executive officers as defined by the
Securities and Exchange Commission and all awards of stock options under the
Company's 1995 Stock Incentive Plan. The Committee's policy is to offer
executive officers competitive compensation packages that will permit the
Company to attract and retain highly qualified individuals and to motivate and
reward such individuals on the basis of the Company's performance.
At present, the executive compensation package consists of base salary,
bonus awards and long-term incentive opportunities in the form of stock
options. Executive salaries are reviewed by the Committee on an annual basis
and are set for individual executive officers based on subjective evaluations
of each individual's performance, the Company's performance and a comparison to
base salary ranges for executives in comparable positions at mid-size mining
companies in the United States, primarily involved in the mining of precious
metals. Within the U.S. uranium mining companies, there are no public companies
which the Committee views as comparable in terms of revenues, reserve base and
type of operations. Although the mid-size precious metal mining companies are
for the most part larger than the Company, the Committee views this group as
being comparable to the Company in terms of the administrative, financial and
operating skills required of the Company's senior executives. The compensation
of the Chief Executive Officer, Mr. Willmott, is determined in the same manner
as the compensation of other executive officers as described above. As a
result, Mr. Willmott's compensation is largely dependent upon the overall
performance of the Company as well as comparison to compensation being paid by
comparable companies to their chief executive officers.
Key employees, including executive officers may be granted incentive stock
options, pursuant to the Company's Stock Incentive Plan and based upon a review
of the Company's performance. Such stock based awards will continue to be an
important element of the executive compensation package because they aid in the
objective of aligning the officers' interests with those of the stockholders by
giving the officers a direct stake in the performance of the Company. Options
totaling 303,810 shares were granted in 1996.
-19 -
<PAGE> 22
Bonuses may be awarded to executive officers and other employees for their
performance. The Committee determines the appropriate level of bonuses based
upon the Committee's assessment of each person's contributions to the Company's
success in terms of income and use of cash, corporate management and increase
in shareholder value. With respect to corporate management objectives,
objectives included obtaining of projected financings, resumption of production
at Kingsville Dome, acquisition of a mineral lease on the Alta Mesa properties,
reduction of unfunded reclamation liabilities, utilization of the matched sale
quota, completion of 1996 exploration activities, achievement of budgeted
production at budgeted costs, progress in obtaining New Mexico environmental
permits, achievement of budgeted overhead reductions, and progress in resolving
various legal issues.
March 26, 1997
MEMBERS OF THE COMPENSATION COMMITTEE
Leland O. Erdahl
George R. Ireland
James B. Tompkins
STOCK PRICE PERFORMANCE GRAPH
The following graph compares the performance of the Company's Common Stock
to the CRSP Total Return Index for The Nasdaq Stock Market (U.S. Companies) and
to a self-determined peer group comprised of United States Energy Corp. and Rio
Algom Mines, Ltd. for the Company's last five fiscal years. The graph assumes
that the value of an investment in the Company's Common Stock and each index
was $100 at December 31, 1991, and that all dividends were reinvested.
-20 -
<PAGE> 23
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
1991-1996
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Total Returns Index For: 12/31/91 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
-------- -------- -------- -------- -------- --------
Nasdaq Stock Market
(U.S. Companies) (a) 100.0 116.4 133.6 130.6 184.7 227.2
Self-Determined Peer Group (b)(c) 100.0 98.3 125.8 142.3 144.8 185.1
Uranium Resources, Inc. (c) 100.0 136.8 152.6 257.1 195.8 284.1
</TABLE>
*Total return assumes reinvestment of dividends.
[GRAPH]
-21 -
<PAGE> 24
(a) Source: National Association of Securities Dealers, Inc. All
dividends are reinvested on the ex-dividend date. The CRSP Total
Return Index includes all domestic common shares traded on the
NASDAQ National Market and the NASDAQ Small-Cap Market.
(b) Comprised of United States Energy Corp. and Rio Algom Mines, Ltd.
(c) Source: The Center for Research in Security Prices (affiliated
with the University of Chicago Graduate School of Business). All
dividends are reinvested on ex-dividend date.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
LOAN FROM THE LINDNER GROUP
In June 1996, the Company received $4,000,000 in proceeds from a one-year
note entered into with the Lindner Dividend Fund. The terms of the note
provided for the payment of both principal and accrued interest by June 1997.
Interest on the note accrued at a rate of 6.5% per annum. The Company used
these proceeds to acquire the mineral lease on the Alta Mesa Property in South
Texas. The Company repaid the note in full in January 1997.
SECTION 16 REPORTING
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers and directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the SEC and the National Association of
Securities Dealers, Inc. Officers, directors, and greater than 10% stockholders
are required by SEC regulation to furnish the Company with copies of all
Section 16(a) filings.
Based solely on its review of copies of such forms received by it and
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that, during the year ended
December 31, 1996, its officers, directors, and greater than 10% beneficial
owners complied with all applicable filing requirements.
-22 -
<PAGE> 25
PROPOSAL TO RATIFY THE SELECTION
OF ARTHUR ANDERSEN, LLP AS AUDITORS
(PROPOSAL 2 ON PROXY CARD)
The Board of Directors voted to engage Arthur Andersen, LLP as independent
accountants to audit the accounts and financial statements of the Company for
the fiscal year ending December 31, 1997, and directed that such engagement be
submitted to the stockholders of the Company for ratification. In recommending
ratification by the stockholders of such engagement, the Board of Directors is
acting upon the recommendation of the Audit Committee, which has satisfied
itself as to the firm's professional competence and standing. Although
ratification by stockholders of the engagement of Arthur Andersen, LLP is not
required by Delaware corporate law or the Company's Restated Certificate of
Incorporation or Bylaws, management feels a decision of this nature should be
made with the consideration of the Company's stockholders. If stockholder
approval is not received, management will reconsider the engagement.
It is expected that one or more representatives of Arthur Andersen, LLP
will be present at the Meeting and will be given the opportunity to make a
statement if they so desire. It also is expected that the representatives will
be available to respond to appropriate questions from the stockholders.
BOARD OF DIRECTORS' RECOMMENDATIONS; VOTE REQUIRED
The Board of Directors unanimously recommends a vote (i) FOR the election
as director of each of the nominees named in the proxy and (ii) FOR the
ratification of the appointment of Arthur Andersen, LLP as independent
auditors.
The affirmative vote of the holders of (i) a plurality of the votes of the
outstanding shares of Common Stock present at the Meeting, either in person or
represented by proxy, is required to elect each nominee as a director and (ii)
a majority of the outstanding shares of Common Stock present at the Meeting,
either in person or represented by proxy, is required to ratify the appointment
of Arthur Andersen, LLP.
-23 -
<PAGE> 26
COST AND METHOD OF PROXY SOLICITATION
The accompanying Proxy is being solicited on behalf of the Board of
Directors of the Company. All expenses for soliciting Proxies, including the
expense of preparing, printing and mailing the form of Proxy and the material
used in the solicitation thereof, will be borne by the Company. In addition to
the use of the mails, Proxies may be solicited by personal interview, telephone
and facsimile by directors and regular officers and employees of the Company.
Such persons will receive no additional compensation for such services.
Arrangements may also be made with brokerage houses and other custodians,
nominees and fiduciaries for the forwarding of solicitation material to the
beneficial owners of stock held of record by such persons, and the Company may
reimburse them for reasonable out-of-pocket expenses incurred by them in
connection therewith.
ANNUAL REPORTS AND CONSOLIDATED FINANCIAL STATEMENTS
You are referred to the Company's annual report, including consolidated
financial statements, for the year ended December 31, 1996, enclosed herewith
for your information. The annual report is not incorporated in this Proxy
Statement and is not to be considered part of the soliciting material.
DEADLINE FOR RECEIPT OF STOCKHOLDER
PROPOSALS FOR 1998 ANNUAL MEETING
Any proposals that stockholders of the Company desire to have presented
at the 1998 Annual Meeting of Stockholders must be received by the Company at
its principal executive offices no later than March 1, 1998.
UNDERTAKING TO PROVIDE DOCUMENTS
THE COMPANY WILL PROVIDE TO EACH PERSON TO WHOM A COPY OF THIS PROXY
STATEMENT IS DELIVERED, UPON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON AND
WITHOUT CHARGE, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR
ENDED DECEMBER 31, 1996 AND UPON THE PAYMENT OF A REASONABLE FEE WHICH SHALL BE
LIMITED TO THE COMPANY'S REASONABLE EXPENSES, A COPY OF ANY EXHIBIT TO SUCH
ANNUAL REPORT ON FORM 10-K. WRITTEN REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED
TO THOMAS H. EHRLICH, URANIUM RESOURCES, INC., 12750 MERIT DRIVE, SUITE 1020,
LB 12, DALLAS, TEXAS 75251, (972) 387-7777.
-24 -
<PAGE> 27
MISCELLANEOUS
The Board of Directors is not aware of any matter, other than the matters
described above, to be presented for action at the Meeting. However, if any
other business properly comes before the Meeting, the person or persons named
in the enclosed form of proxy will vote the proxy in accordance with his or
their best judgment on such matters.
DALLAS, TEXAS
March 26, 1997
-25 -
<PAGE> 28
URANIUM RESOURCES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
To be Held on May 1, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Uranium Resources, Inc. (the "Company")
hereby constitutes and appoints Paul K. Willmott, George R. Ireland, James B.
Tompkins and Leland O. Erdahl, or any of them acting singly, each with the
power of substitution as attorneys and proxies to vote all of the shares which
the undersigned is entitled to vote at the Annual Meeting of Stockholders of
the Company to be held in the Alamo Room of the Landmark Club, 12740 Merit
Drive, Dallas, Texas, 75251 on Thursday, May 1, 1997, at 9:00 a.m., local time,
and at any and all adjournments thereof, with the same force and effect as if
the undersigned were personally present, and the undersigned hereby instructs
the above- named Attorneys and Proxies to vote as follows:
1. ELECTION OF DIRECTORS. The following four persons have been nominated to
serve on the Company's Board of Directors: Paul K. Willmott, George R. Ireland,
James B. Tompkins and Leland O. Erdahl.
[ ] FOR all nominees listed above [ ] WITHHOLD AUTHORITY
to vote for all nominees
listed above
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY ONE OR MORE INDIVIDUAL
NOMINEES, WRITE THE NAME OF EACH SUCH NOMINEE IN THE SPACE PROVIDED
BELOW.)
Withhold authority to vote for any individual nominee___________________
2. RATIFICATION OF ARTHUR ANDERSEN LLP. Proposal to ratify the selection of
Arthur Andersen, LLP, independent accountants, as the independent auditors
of the Company for the fiscal year ending December 31, 1997:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. OTHER BUSINESS. In their discretion, the proxies are authorized to vote
upon such other business as may properly come before the Meeting or any
adjournment of adjournments thereof.
<PAGE> 29
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE NOMINEES SET FORTH IN PROPOSAL 1 AND FOR PROPOSAL 2.
DATED:____________________________, 1997
________________________________________
(Signature)
________________________________________
(Signature)
NOTE: Please sign exactly as your name or
names appear on this card. Joint owners
should each sign personally. When
signing as attorney, executor,
administrator, personal representative,
trustee or guardian, please give your
full title as such. For a corporation or
a partnership, please sign in the full
corporate name by the President or other
authorized officer or the full
partnership name by an authorized
person, as the case may be. (Please
mark, sign, date, and return this proxy
in the enclosed envelope.)
