Quarterly report pursuant to Section 13 or 15(d)

Warrant Liability

v3.23.2
Warrant Liability
6 Months Ended
Jun. 30, 2023
Warrant Liability  
Warrant Liability

11. Warrant Liability

 

In February 2021, we issued 16,930,530 warrants as part of an underwritten public offering with two warrants redeemable for one common share of the Company’s stock at a price of $1.35 per full share. The warrants will expire in February 2024.

 

In February 2023, we issued 39,100,000 warrants as part of an underwritten public offering with two warrants redeemable for one common share of the Company’s stock at a price of $1.50 per full share. The warrants will expire in February 2026.

 

Because the warrants are priced in U.S. dollars and the functional currency of Ur-Energy Inc. is Canadian dollars, a derivative financial liability was created. The liability created, and adjusted monthly, is calculated using the Black-Scholes model described below as there is no active market for the warrants. Any gain or loss from the adjustment of the liability is reflected in net income for the period.

 

The Company’s warrant liabilities consist of the following:

 

 Warrant Liability Activity

 

 Feb-2021

Warrants

 

 

 Feb-2023

Warrants

 

 

 Total

 

 

 

 

 

 

 

 

 

 

 

December 31, 2022

 

 

2,382

 

 

 

-

 

 

 

2,382

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Warrants issued

 

 

-

 

 

 

9,109

 

 

 

9,109

 

Mark to market revaluation gain

 

 

(1,706 )

 

 

(1,355 )

 

 

(3,061 )

Effects for foreign exchange rate changes

 

 

16

 

 

 

125

 

 

 

141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2023

 

 

692

 

 

 

7,879

 

 

 

8,571

 

 

 Warrant Liability Duration

 

 Feb-2021

Warrants

 

 

Feb-2023

Warrants

 

 

 Total

 

 

 

 

 

 

 

 

 

 

 

Current portion of warrant liability

 

 

692

 

 

 

-

 

 

 

692

 

Long-term warrant liability

 

 

-

 

 

 

7,879

 

 

 

7,879

 

 

 

 

692

 

 

 

7,879

 

 

 

8,571

 

 

The fair value of the warrant liabilities on June 30, 2023, was determined using the Black-Scholes model with the following assumptions:

 

 

 

Feb-2021

 

 

Feb-2023

 

Black-Scholes Assumptions as of June 30, 2023

 

Warrants

 

 

Warrants

 

 

 

 

 

 

 

 

Expected forfeiture rate

 

 

-

 

 

 

-

 

Expected life (years)

 

 

0.6

 

 

 

2.6

 

Expected volatility

 

 

51.4 %

 

 

73.5 %

Risk free rate

 

 

4.5 %

 

 

4.3 %

Expected dividend rate

 

 

-

 

 

 

-

 

Exercise price

 

$

1.35

 

 

$ 1.50

 

Market price

 

$

1.05

 

 

$ 1.05