Uranium Resources, Inc. (NASDAQ: URRE) (“URI” or the “Company”), today announced that it has filed a proxy statement to seek shareholder approval of a reverse stock split. The Company also announced the closing of $5 million in bridge financing (“Bridge Financing”) with Resource Capital Fund V L.P. (“RCF”) and the Company’s plan to undertake a shareholder rights offering (“Rights Offering”) in 2013.
Reverse Stock Split Proposed to Shareholders to Maintain NASDAQ Listing
In order to regain compliance with NASDAQ’s minimum $1.00 bid price requirement and maintain the Company’s NASDAQ listing, URI’s Board has unanimously approved a charter amendment to conduct a reverse stock split.
On December 17, 2012, URI filed definitive proxy materials with the SEC seeking shareholder approval of the charter amendment that will permit it to conduct a reverse stock split of the Company’s issued and outstanding common stock, by a ratio of not less than 1-for-5 and not more than 1-for-15, with the final ratio to be determined by the Company’s Board following shareholder approval. A special meeting of shareholders has been scheduled for January 14, 2013 to vote on the reverse split.
URI Secures Bridge Financing Facility
The $5 million Bridge Financing, which carries an annualized interest rate of 10%, will be used for the advancement of URI’s strategic projects and general working capital requirements.
Terence J. Cryan, Interim President and CEO of URI commented, “As our largest shareholder, we believe RCF’s commitment to URI with additional funds is validation of the inherent value of URI’s strategy and its assets. Our near-term priorities are focused on those efforts that will de-risk and improve the economics of our Churchrock project, as well as maintain our restoration activities in Texas. Our objective is to fully realize the value of our assets in the ground.”
The Bridge Financing contains customary representations, warranties, covenants, security provisions and events of default, and requires the Company to remain listed on the NASDAQ stock market. It matures on the earlier of the closing of the planned Rights Offering or June 28, 2013.