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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2013

or

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission File Number: 001-33706

URANIUM ENERGY CORP.
(Exact name of registrant as specified in its charter)

NEVADA	98-0399476
(State or other jurisdiction of incorporation of organization)	(I.R.S. Employer Identification No.)
1111 West Hastings Street, Suite 320, Vancouver, B.C.	V6E 2J3
(Address of principal executive offices)	(Zip Code)

(604) 682-9775
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal
year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]     No [   ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes [X]     No [   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

[   ]	Large accelerated filer	[X]	Accelerated filer
[   ]	Non-accelerated filer (Do not check if a smaller reporting company)	[   ]	Smaller reporting company

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [   ]     No [X]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 89,696,759 shares of common stock outstanding as of December 6, 2013.

2

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URANIUM ENERGY CORP.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION		4
Item 1.	Financial Statements	4
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31
PART II – OTHER INFORMATION		32
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	42
SIGNATURES		43

3

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PART I – FINANCIAL INFORMATION

Item 1.      Financial Statements

4

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URANIUM ENERGY CORP.

 

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED OCTOBER 31, 2013

(Unaudited)

5

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URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

		Notes			October 31, 2013			July 31, 2013
CURRENT ASSETS
Cash and cash equivalents				$	14,698,564		$	14,171,807
Available-for-sale securities					16,049			18,350
Accounts and interest receivable					49,885			45,584
Inventories		3			1,401,086			975,719
Prepaid expenses and deposits					1,049,569			1,098,026
Current portion of deferred financing costs					218,336			218,336
					17,433,489			16,527,822
DEFERRED FINANCING COSTS					145,557			200,141
MINERAL RIGHTS AND PROPERTIES		4			41,426,321			41,785,852
PROPERTY, PLANT AND EQUIPMENT		5			8,645,318			8,695,277
RECLAMATION DEPOSITS		6			6,041,419			6,040,909
				$	73,692,104		$	73,250,001
CURRENT LIABILITIES
Accounts payable and accrued liabilities				$	2,733,144		$	3,978,867
Due to related parties		7			9,354			9,571
Variable share forward contract		8			231,762			-
Current portion of long-term debt		8			3,333,333			833,333
Current portion of asset retirement obligations		9			834,609			836,073
					7,142,202			5,657,844
DEFERRED INCOME TAX LIABILITIES					781,186			781,186
LONG-TERM DEBT		8			4,054,893			6,123,886
ASSET RETIREMENT OBLIGATIONS		9			3,300,578			3,242,007
					15,278,859			15,804,923
STOCKHOLDERS' EQUITY
Capital stock
Common stock $0.001 par value: 750,000,000 shares              authorized, 89,611,281 shares issued and outstanding              (July 31, 2013 - 86,032,285)		10			89,615			86,036
Additional paid-in capital					206,892,904			200,046,081
Accumulated deficit					(148,566,973	)		(142,687,039	)
Accumulated other comprehensive loss					(2,301	)		-
					58,413,245			57,445,078
				$	73,692,104		$	73,250,001
COMMITMENTS AND CONTINGENCIES		14

The accompanying notes are an integral part of these condensed consolidated financial statements

6

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URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)

					Three Months Ended October 31,
		Notes			2013			2012
SALES				$	-		$	2,153,250
COSTS AND EXPENSES
Cost of sales					-			1,863,109
Inventory write-down		3			392,149			-
Mineral property expenditures		4			1,588,143			4,377,285
General and administrative		7&10			2,305,789			2,724,937
Depreciation, amortization and accretion		4, 5&9			541,079			496,347
Impairment loss on mineral property		4			28,891			-
					4,856,051			9,461,678
LOSS FROM OPERATIONS					(4,856,051	)		(7,308,428	)
OTHER INCOME (EXPENSES)
Interest income					5,326			14,578
Interest and finance costs		8			(797,447	)		(6,110	)
Loss on fair value of variable share forward contract		8			(231,762	)		-
Gain on settlement of accounts payable					-			10,909
Loss on settlement of asset retirement obligations					-			(8,572	)
					(1,023,883	)		10,805
NET LOSS FOR THE PERIOD					(5,879,934	)		(7,297,623	)
OTHER COMPREHENSIVE LOSS,     NET OF INCOME TAXES					(2,301	)		(481	)
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD				$	(5,882,235	)	$	(7,298,104	)
NET LOSS PER SHARE, BASIC AND DILUTED				$	(0.07	)	$	(0.09	)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED					86,429,172			85,172,927

The accompanying notes are an integral part of these condensed consolidated financial statements

7

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URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

					Three Months Ended October 31,
		Notes			2013			2012
CASH (USED IN) PROVIDED BY:
OPERATING ACTIVITIES
Net loss for the period				$	(5,879,934	)	$	(7,297,623	)
Adjustments to reconcile net loss to net cash from operating activities
Stock-based compensation		10			337,902			433,643
Depletion, depreciation, amortization and accretion					1,102,367			700,658
Impairment loss on mineral property					28,891			-
Loss on fair value of variable share forward contract		8			231,762			-
Gain on settlement of accounts payable					-			(10,909	)
Loss on settlement of asset retirement obligations					-			8,572
Changes in operating assets and liabilities
Accounts and interest receivable					(4,301	)		(52,276	)
Inventories		3			(312,467	)		278,474
Prepaid expenses and deposits					(125,249	)		(136,436	)
Accounts payable and accrued liabilities					(1,259,043	)		(1,601,224	)
Settlement of asset retirement obligations		9			(12,123	)		(44,713	)
NET CASH FLOWS USED IN OPERATING ACTIVITIES					(5,892,195	)		(7,721,834	)
FINANCING ACTIVITIES
Share issuance for cash, net of issuance costs					6,713,504			39,748
Debt financing costs		12			(188,107	)		-
Due to related parties		7			(217	)		(33,446	)
NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES					6,525,180			6,302
INVESTING ACTIVITIES
Investment in mineral rights and properties		4			(83,823	)		(7,396	)
Purchase of property, plant and equipment					(21,895	)		(103,190	)
Reclamation deposits					(510	)		(2,048	)
NET CASH FLOWS USED IN INVESTING ACTIVITIES					(106,228	)		(112,634	)
NET CASH FLOWS					526,757			(7,828,166	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD					14,171,807			25,015,284
CASH AND CASH EQUIVALENTS, END OF PERIOD				$	14,698,564		$	17,187,118
SUPPLEMENTAL CASH FLOW INFORMATION		12

The accompanying notes are an integral part of these condensed consolidated financial statements

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URANIUM ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)

														Accumulated
														Other
		Common Stock						Additional Paid-in			Accumulated			Comprehensive			Stockholders'
		Shares			Amount			Capital			Deficit			Income			Equity
Balance, July 31, 2013		86,032,285		$	86,036		$	200,046,081		$	(142,687,039	)	$	-		$	57,445,078
Common stock
Issued for equity financing		3,380,954			3,381			5,905,670			-			-			5,909,051
Issued for exercise of stock options and warrants		67,803			68			22,433			-			-			22,501
Stock-based compensation
Common stock issued for consulting services		130,239			130			290,422			-			-			290,552
Options issued for consulting services		-			-			13,604			-			-			13,604
Options issued for employee benefits		-			-			34,169			-			-			34,169
Warrants issued for equity financing		-			-			580,525			-			-			580,525
Net loss for the period		-			-			-			(5,879,934	)		-			(5,879,934	)
Other comprehensive loss		-			-			-			-			(2,301	)		(2,301	)
Balance, October 31, 2013		89,611,281		$	89,615		$	206,892,904		$	(148,566,973	)	$	(2,301	)	$	58,413,245

The accompanying notes are an integral part of these condensed consolidated financial statements

9

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

NOTE 1:              NATURE OF OPERATIONS

Uranium Energy Corp. was incorporated in the State of Nevada on May 16, 2003. Uranium Energy Corp. and its subsidiary companies and a controlled partnership (collectively, the “Company”) are engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates, on projects located in the United States and Paraguay.

Although planned principal operations have commenced from which significant gross revenues from uranium sales were realized for the fiscal years ended July 31, 2013 (“Fiscal 2013”) and 2012 (“Fiscal 2012”), the Company has yet to achieve profitability and has had a history of operating losses and significant negative cash flow since inception. Historically, the Company has been reliant primarily on equity financings from the sale of its common stock and, more recently, on debt financing to fund ongoing operations. The Company has also relied on cash flows generated from its mining activities during Fiscal 2013 and 2012. The Company’s reliance on equity and debt financings is expected to continue for the foreseeable future. Existing cash resources and available sources of financing are expected to provide sufficient funds to carry out the Company’s plan of operations for the next twelve months. The Company’s continuation as a going concern for a period beyond twelve months will be dependent upon its ability to obtain adequate additional financing, as the Company’s operations are capital intensive and future capital expenditures are expected to be substantial. The continued operations of the Company, including the recoverability of the carrying values of its assets, are dependent ultimately on the Company’s ability to achieve and maintain profitability and positive cash flow from its operations. At October 31, 2013, the Company had working capital of $10.3 million and an accumulated deficit of $148.6 million.

NOTE 2:              BASIS OF PRESENTATION

The accompanying unaudited interim condensed consolidated financial statements are presented in U.S. dollars and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required under U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2013. In the opinion of management, all adjustments of a normal recurring nature and considered necessary for a fair presentation have been made. Operating results for the three months ended October 31, 2013 are not necessarily indicative of the results that may be expected for the fiscal year ending July 31, 2014.

Exploration Stage

The Company has established the existence of mineralized materials for certain uranium projects, including the Palangana Mine. The Company has not established proven or probable reserves, as defined by the United States Securities and Exchange Commission (the “SEC”) under Industry Guide 7, through the completion of a “final” or “bankable” feasibility study for any of its uranium projects, including the Palangana Mine. Furthermore, the Company has no plans to establish proven or probable reserves for any of its uranium projects for which the Company plans on utilizing in-situ recovery (“ISR”) mining, such as the Palangana Mine. As a result, and despite the fact that the Company commenced extraction of mineralized materials at the Palangana Mine in November 2010, the Company remains in the Exploration Stage as defined under Industry Guide 7, and will continue to remain in the Exploration Stage until such time proven or probable reserves have been established.

Since the Company commenced extraction of mineralized materials at the Palangana Mine without having established proven and probable reserves, any mineralized materials established or extracted from the Palangana Mine should not be in any way associated with having established or produced from proven or probable reserves.

In accordance with U.S. GAAP, expenditures relating to the acquisition of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time 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 and disposal wells are expensed as incurred until such time proven or probable reserves are established for that uranium project, after which subsequent expenditures relating to mine development activities for that particular project are capitalized as incurred.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

 

Companies in the Production Stage as defined under Industry Guide 7, having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. The Company is in the Exploration Stage 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 mill and mine development 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 consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage.

NOTE 3:              INVENTORIES

In November 2010, the Company commenced uranium extraction at its Palangana Mine and processing of uranium concentrates at its Hobson Processing Facility. The Company’s inventories consist of the following:

		October 31, 2013			July 31, 2013
Supplies	$	30,411		$	63,859
Work-in-progress		38,907			72,272
Finished goods - uranium concentrates		1,331,768			839,588
	$	1,401,086		$	975,719

At October 31, 2013, the total non-cash component of inventory was $261,622 (July 31, 2013: $148,722). During the three months ended October 31, 2013 and 2012, the Company recorded an inventory write-down to net realizable value totaling $392,149 and $Nil, respectively.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

NOTE 4:              MINERAL RIGHTS AND PROPERTIES

Mineral Rights

At October 31, 2013, the Company had mineral rights in the States of Arizona, Colorado, New Mexico, Texas and Wyoming and Paraguay. These mineral rights were acquired through staking and purchase, lease or option agreements and are subject to varying royalty interests, some of which are indexed to the sale price of uranium. At October 31, 2013, annual maintenance payments of approximately $1,767,000 are required to maintain these mineral rights.

Mineral rights and property acquisition costs consist of the following:

		October 31, 2013			July 31, 2013
Mineral Rights and Properties, Unproven
Palangana Mine	$	7,045,457		$	7,045,457
Goliad Project		8,689,127			8,689,127
Burke Hollow Project		1,313,250			1,313,250
Channen Project		428,164			428,164
Salvo Project		364,710			363,645
Nichols Project		154,774			154,774
Anderson Project		9,154,268			9,154,268
Workman Creek Project		1,287,158			1,287,158
Los Cuatros Project		257,250			257,250
Slick Rock Project		171,271			163,213
Todilto Project		166,720			166,720
Yuty Project		11,947,144			11,947,144
Coronel Oviedo Project		1,133,412			1,133,412
Other Property Acquisitions		1,081,848			1,067,148
		43,194,553			43,170,730
Impairment of Mineral Rights and Properties		(28,891	)		-
		43,165,662			43,170,730
Accumulated Depletion		(2,623,879	)		(2,278,053	)
		40,541,783			40,892,677
Databases		2,405,038			2,345,038
Accumulated Amortization		(1,743,895	)		(1,685,011	)
		661,143			660,027
Land Use Agreements		390,155			390,155
Accumulated Amortization		(166,760	)		(157,007	)
		223,395			233,148
	$	41,426,321		$	41,785,852

The Company has not established proven or probable reserves, as defined by the SEC under Industry Guide 7, through the completion of a “final” or “bankable” feasibility study for any of its mineral projects. The Company has established the existence of mineralized materials for certain uranium projects, including the Palangana Mine. Since the Company commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

No revenues were generated from the sale of U₃O₈ during the three months ended October 31, 2013. The Palangana Mine has been the Company’s sole source for the U₃O₈ sold to generate its revenues during Fiscal 2013 and 2012, with no revenues generated prior to Fiscal 2012. The economic viability of the Company’s mining activities, including the expected duration and profitability of the Palangana Mine and of any future satellite ISR mines, such as the Goliad Project, located within the South Texas Uranium Belt, has many risks and uncertainties. These include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. The Company’s mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in profitable mining activities.

Mineral property expenditures incurred by major projects are as follows:

		Three Months Ended October 31,
		2013			2012
Mineral Property Expenditures
Palangana Mine	$	671,582		$	1,823,863
Goliad Project		144,971			104,002
Burke Hollow Project		174,298			1,102,932
Channen Project		465			691,262
Anderson Project		84,161			74,722
Workman Creek Project		28,971			30,936
Slick Rock Project		49,025			55,010
Yuty Project		17,825			91,270
Coronel Oviedo Project		84,151			199,801
Other Mineral Property Expenditures		332,694			203,487
	$	1,588,143		$	4,377,285

During the three months ended October 31, 2013, the Company abandoned a mineral property with acquisition costs of $28,891 located in Colorado. As a result, an impairment loss of $28,891 was recorded in the consolidated statement of operations of the Company. No impairment loss was recorded for the three months ended October 31, 2012.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

NOTE 5:              PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consist of the following:

Hobson Processing Facility

The Company acquired the Hobson Processing Facility (“Hobson”) as part of the Acquisition of South Texas Mining Venture, L.L.P. in December 2009 and commenced processing uranium-loaded resins from the Palangana Mine in November 2010, at which point the Company began depreciating the capitalized costs of Hobson on a straight-line basis over an expected useful life of ten years. Upon further review of the Company’s anticipated satellite mining activities in Texas, the expected useful life of Hobson was determined to have an estimated 12 years remaining from August 1, 2013. Accordingly, the Company began depreciating the remaining undepreciated capitalized costs of Hobson on a straight-line basis over an expected useful life of 12 years effective August 1, 2013.

NOTE 6:              RECLAMATION DEPOSITS

Reclamation deposits include interest and non-interest bearing deposits issued in the States of Arizona, Texas and Wyoming relating to exploration, pre-extraction, extraction and processing activities in the respective states. Reclamation deposits consist of the following:

		October 31, 2013			July 31, 2013
Palangana Mine	$	3,627,562		$	3,627,562
Hobson Processing Facility		1,910,494			1,910,494
Mount Lucas		472,823			472,823
Arizona		15,000			15,000
Wyoming		814			814
		6,026,693			6,026,693
Interest		14,726			14,216
	$	6,041,419		$	6,040,909

NOTE 7:              RELATED PARTY TRANSACTIONS

During the three months ended October 31, 2013, the Company had transactions with certain officers and directors of the Company as follows:

• Incurred $37,403 (three months ended October 31, 2012: $48,433) in general and administrative costs paid to a company controlled by a direct family member of a director and officer; and

• Incurred $9,000 (three months ended October 31, 2012: $9,000) in consulting fees paid to a company controlled by a director of the Company.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

At October 31, 2013, amounts due to related parties totaled $9,354 (July 31, 2013: $9,571). These amounts are unsecured, non-interest bearing and due on demand.

NOTE 8:              LONG-TERM DEBT

Long-Term Debt

At October 31, 2013, long-term debt consisted of the following:

		October 31, 2013			July 31, 2013
Principal amount	$	10,000,000		$	10,000,000
Unamortized discount		(2,611,774	)		(3,042,781	)
Long-term debt, net of unamortized discount		7,388,226			6,957,219
Current portion		3,333,333			833,333
Long-term debt, net of current portion	$	4,054,893		$	6,123,886

For the three months ended October 31, 2013, the amortization of debt discount totaled $431,007 which was recorded as interest expense and included in the consolidated statements of operations.

The aggregate yearly maturities of long-term debt based on principal amounts outstanding at October 31, 2013 are as follows:

July 31, 2014	$	833,333
July 31, 2015		9,166,667
Total	$	10,000,000

Variable Share Forward Contract

Pursuant to a Credit Agreement dated and effective July 30, 2013 (the “Credit Facility”), the Company issued bonus shares with a total value of $900,000, comprised initially of 407,239 shares of the Company issued at a price of $2.21 per share (the “Bonus Shares”). The Bonus Shares are held and will remain in escrow until the final number of shares are determined on July 30, 2014 (the “Settlement Date”) based on a 10% discount to the five trading-day, volume-weighted average closing price of the Company’s shares as calculated on the Settlement Date (the “Final Share Price”).

Depending on the Final Share Price, the Company may be required to issue additional shares above the initial 407,239 shares issued as the Bonus Shares, or some of the initial 407,239 shares issued as Bonus Shares may be required to be returned to the Company for cancellation. This feature of adjusting the number of shares for issuance at a future date was identified as a freestanding financial instrument, variable share forward contract. In accordance with ASC 480 - Distinguishing Liabilities from Equity, this variable share forward contract was classified as a liability upon initial recognition on July 30, 2013 with a nominal value, subject to subsequent fair value measurement.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

At October 31, 2013, the fair value of the incremental number of shares that would have been issued assuming a final Settlement Date of October 31, 2013 is presented below:

Number of shares to be issued		538,922
Number of shares issued at July 31, 2013		407,239
Incremental number of shares		131,683
Share price at October 31, 2013	$	1.76
Balance, October 31, 2013	$	231,762
Balance, July 31, 2013		-
Loss on fair value of variable share forward contract	$	231,762

As a result, the Company recorded a loss on fair value of variable share forward contract in its consolidated statement of operations for the three months ended October 31, 2013.

NOTE 9: ASSET RETIREMENT OBLIGATIONS

The Company's asset retirement obligations ("ARO") relates to site restoration for the Hobson Processing Facility, Palangana Mine and Mt. Lucas assumed as part of the STMV Acquisition.

		October 31, 2013			July 31, 2013
Opening balance	$	4,078,080		$	3,112,374
Revision in estimate of asset retirement obligations		-			435,758
Additions of asset retirement obligations		-			435,004
Liabilities settled with cash		(12,123	)		(109,916	)
Accretion		69,231			204,860
		4,135,187			4,078,080
Less: current portion of asset retirement obligations		(834,609	)		(836,073	)
Long-term asset retirement obligations	$	3,300,578		$	3,242,007

		October 31, 2013			July 31, 2013
Undiscounted amount of estimated cash flows	$	5,963,142		$	5,975,265
Payable in years		2.5 to 12			2.5 to 12
Inflation rate		1.56% to 2.43%			1.56% to 2.43%
Discount rate		5.00% to 10.50%			5.00% to 10.50%

The undiscounted amounts of estimated cash flows for the next five years and beyond are as follows:

Undiscounted estimated cash flow for the next five years
July 31, 2014	$	856,373
July 31, 2015		623,964
July 31, 2016		598,202
July 31, 2017		1,549,289
July 31, 2018		-
Remaining balance		2,335,314
	$	5,963,142

16

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

NOTE 10:            CAPITAL STOCK

Capital Stock

At October 31, 2013, the Company’s capital stock was 750,000,000 authorized shares of common stock with a par value of $0.001 per share.

Equity Financing

On October 23, 2013, the Company completed a public offering of 3,380,954 units at a price of $2.10 per unit for gross proceeds of $7,100,003 pursuant to a prospectus supplement to the Company’s effective shelf registration statement on Form S-3 previously filed with the SEC. Each unit is comprised of one share of common stock of the Company and 0.55 of one share purchase warrant, each whole warrant exercisable at a price of $2.60 for a three year period to purchase one share of common stock of the Company.

The shares are valued at the Company’s closing price of $1.89 at October 23, 2013, and the share purchase warrants are valued using the Black-Scholes options pricing model with the following assumptions:

Expected Risk Free Interest Rate		0.60%
Expected Annual Volatility		66.34%
Expected Contractual Life in Years		3.00
Expected Annual Dividend Yield		0%

The fair value of shares and share purchase warrants are allocated to the estimated net proceeds from the equity financing. The relative fair value of the shares and share purchase warrants calculated from the allocation is as below:

Fair Value of Common Shares	$	6,390,003
Fair Value of Share Purchase Warrants		627,775
Total Fair Value Before Allocation to Net Proceeds		7,017,778
Gross Proceeds		7,100,003
Estimated Share Issuance Costs		(610,427	)
Estimated Net Proceeds Received		6,489,576
Relative Fair Value Allocation to:
Common Shares		5,909,051
Share Purchase Warrants		580,525
	$	6,489,576

Share Transactions

Period / Description		Common Shares Issued			Value per Share						Issuance Value
					Low			High
Balance, July 31, 2013		86,032,285
Equity Financing		3,380,954		$	1.75		$	1.75			5,909,051
Options Exercised		67,803			0.33			0.33			22,501
Service Agreements		130,239			2.10			2.41			290,552
Balance, October 31, 2013		89,611,281

17

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

Share Purchase Warrants

A continuity schedule of outstanding and exercisable share purchase warrants for the underlying common shares at October 31, 2013, and the changes during the period, is presented below:

								Weighted Average
		Number of			Weighted Average			Remaining Contractual
		Warrants			Exercise Price			Term (Years)
Balance, July 31, 2013		3,150,000		$	2.25			2.90
Issued in connection with equity financing		1,859,524			2.60			3.00
Balance, October 31, 2013		5,009,524		$	2.38			2.77

Stock Options

At October 31, 2013, the Company has one stock option plan, the 2013 Stock Incentive Plan (the “2013 Plan”). The 2013 Plan includes 8,905,128 shares that may be issued pursuant to options previously granted under the Company’s prior stock option plans and 2,000,000 additional shares that may be issued pursuant to awards that may be granted under the 2013 Plan. The 2013 Plan supersedes and replaces each of the Company’s prior stock option plans, being the 2006 Stock Option Plan and the 2009 Stock Option Plan, such that no further shares are issuable under either of such plans.

During the three months ended October 31, 2013, the Company did not grant any stock options under the 2013 Plan.

A continuity schedule of outstanding stock options for the underlying common shares at October 31, 2013, and the changes during the period, is presented below:

								Weighted Average
		Number of Stock			Weighted Average			Remaining Contractual
		Options			Exercise Price			Term (Years)
Balance, July 31, 2013		8,966,189		$	2.02			5.72
Exercised		(67,803	)		0.33			1.19
Expired		(3,900	)		10.26			-
Forfeited		(75,000	)		3.12			2.17
Balance, October 31, 2013		8,819,486		$	2.02			5.53

In Fiscal 2012, as a result of the acquisition of Cue Resources Ltd. (“Cue”) effective March 30, 2012, the Company issued the following options, which were not issued pursuant to, and are not subject to the terms and conditions of, the Company’s Stock Option Plans, in exchange for Cue stock options and broker options:

• Stock options to purchase 48,748 shares of the Company exercisable at prices ranging from $5.13 to $23.08 per share until expiry from July 15, 2013 to August 3, 2016; and
• Broker options to purchase 38,773 shares of the Company exercisable at a price of $3.59 per share until expiry on November 10, 2012.

At October 31, 2013, 38,773 broker options and 7,800 stock options expired unexercised.

At October 31, 2013, stock options to purchase 40,948 common shares remained outstanding and are included in the above continuity schedule of outstanding stock options.

The aggregate intrinsic value under the provisions of ASC 718 of all outstanding options at October 31, 2013 was estimated at $3,644,351 (vested: $3,638,851 and unvested: $5,500).

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

At October 31, 2013, unrecognized compensation cost related to non-vested stock options granted under the Company’s 2013 Plan was $175,148, which is expected to be recognized over 0.99 years.

A summary of options outstanding and exercisable at October 31, 2013 is presented below:

		Options Outstanding						Options Exercisable
Range of Exercise Prices		Outstanding at			Weighted Average			Exercisable at			Weighted Average
		October 31, 2013			Exercise Price			October 31, 2013			Exercise Price
$0.33 to $0.70		2,647,288		$	0.41			2,647,288		$	0.41
$0.71 to $2.45		3,851,250			2.37			3,716,250			2.37
$2.46 to $11.28 (1)		2,320,948			3.26			2,199,284			3.27
		8,819,486		$	2.02			8,562,822		$	2.00

(1) Options include 40,948 options issued in connection with the acquisition of Cue, which were not issued pursuant to, and are not subject to the terms and conditions of, the Company’s 2013 Plan.

Stock-Based Compensation

A summary of stock-based compensation expense for the three months ended October 31, 2013 and 2012 is presented below:

		Three Months Ended October 31,
		2013			2012
Stock-Based Consulting Fees
Common stock issued for consulting services	$	290,552		$	190,500
Options issued to consultants		13,604			100,476
		304,156			290,976
Stock-Based Wages and Benefits
Options issued to employees		34,169			142,667
		34,169			142,667
Stock-based compensation charged to inventory		(993	)		(20,364	)
	$	337,332		$	413,279

NOTE 11:            LOSS PER COMMON SHARE

The following table reconciles weighted average common shares used in the computation of basic and diluted loss per share for the three months ended October 31, 2013 and 2012.

		Three Months Ended October 31,
Numerator		2013			2012
Net Loss for the Period	$	(5,879,934	)	$	(7,297,623	)
Denominator
Basic Weighted Average Number of Shares		86,429,172			85,172,927
Dilutive Stock Options and Warrants		-			-
Diluted Weighted Average Number of Shares		86,429,172			85,172,927
Net Loss per Share, Basic and Diluted	$	(0.07	)	$	(0.09	)

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

For the three months ended October 31, 2013 and 2012, total options and share purchase warrants to purchase 13,829,010 and 10,906,333 shares of our common stock, respectively, were excluded from the computation of diluted loss per shares since we incurred a loss and effect of inclusion is anti-dilutive.

NOTE 12:            SEGMENTED INFORMATION

The Company currently operates in a single reportable segment and is focused on uranium mining and related activities, including exploration, pre-extraction, extraction and processing of uranium concentrates.

As at October 31, 2013, long-term assets located in the U.S. were $43,117,291, or 77% of the Company’s total long-term assets of $56,258,615.

The table below provides a breakdown of the Company’s long-term assets by geographic segments:

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

The table below provides a breakdown of the Company’s operating results by geographic segments. All intercompany transactions have been eliminated.

NOTE 13:            SUPPLEMENTAL CASH FLOW INFORMATION

During the three months ended October 31, 2013, the Company issued 130,239 restricted shares with a fair value of $290,552 for various consulting services.

In connection with the debt financing in July 2013, the Company incurred debt financing costs of $418,477 which were included in accounts payable and accrued liabilities at July 31, 2013. During the three months ended October 31, 2013, the Company paid debt financing costs of $188,107 in cash.

NOTE 14:            COMMITMENTS AND CONTINGENCIES

The Company is renting or leasing various office or storage space located in the United States, Canada and Paraguay with total monthly payments of $23,555. Office lease agreements expire between November 2013 to July 2015 for the United States and Canada. The Company also has various consulting agreements which will expire in less than one year.

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URANIUM ENERGY CORP.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2013

(Unaudited)

The aggregate minimum payments over the next five years are as follows:

July 31, 2014	$	154,234
July 31, 2015		142,592
	$	296,826

The Company is committed to pay its key executives a total of $518,243 per year for management services.

During Fiscal 2012, the Company entered into a lease option agreement granting the Company the exclusive right to explore for uranium and enter into a mining lease and surface use agreement on the Channen Project, a 10,704-acre property located in Goliad County, Texas. The lease option agreement is subject to minimum exploration expenditures totaling $1.75 million over a two-year period originally ending December 31, 2013 which was extended to May 31, 2015. During Fiscal 2013, the Company incurred $843,243 of exploration expenditures and fulfilled the first-year minimum exploration of $0.75 million.

The Company entered into a multi-year uranium sales contract in June 2011, as amended in January 2012, requiring the delivery of a total 320,000 pounds of U₃O₈ by the Company over a three-year period starting in August 2011. The sales price will be based on published market price indicators at the time of delivery. During Fiscal 2012, the Company fulfilled its first-year delivery obligations under this contract. During Fiscal 2013, the Company fulfilled its second-year delivery obligation in full and third-year delivery obligation in part under this contract. During the three months ended October 31, 2013, the remaining delivery commitment of 30,000 pounds under this contract was cancelled at no cost to the Company.

On or about March 9, 2011, the Texas Commission on Environmental Quality (the “TCEQ”) granted the Company’s applications for a Class III injection well, Production Area Authorization and Aquifer Exemption permits for its Goliad Project. On or about December 4, 2012, the U.S. Environmental Protection Agency (the “EPA”) concurred with the TCEQ issuance of the Aquifer Exemption permit. With the receipt of this concurrence, the final authorization required for uranium extraction, the Goliad Project achieved fully-permitted status. On or about May 24, 2011, a group of petitioners, inclusive of Goliad County, appealed the TCEQ action to the 250^th District Court in Travis County, Texas. The petitioners’ appeal lay dormant until on or about June 14, 2013, when the petitioners filed their initial brief in support of their position. The Company has, since inception, successfully intervened as a party. On or about January 18, 2013, a different group of petitioners, exclusive of Goliad County, filed a petition for review with the Court of Appeals for the Fifth Circuit in the United States to appeal the EPA’s decision. On or about March 5, 2013, a motion filed by the Company to intervene in this matter was granted by the court. The parties are attempting to resolve both appeals and, to facilitate discussions and to avoid further legal costs, the parties have jointly agreed, through mediation which was initially conducted through the Fifth Circuit on or about August 8, 2013, to abate the proceedings in the State District Court; which was approved by the State District Court on or about August 21, 2013. The Company continues to believe that the pending appeals are without merit and is continuing forward as planned towards uranium extraction at its fully-permitted Goliad Project.

On or about April 3, 2012, the Company received notification of a lawsuit filed in the State of Arizona, in the Superior Court for the County of Yavapai, by certain Petitioners (the “Plaintiffs”) against a group of defendants, including the Company and former management and board members of Concentric. The lawsuit asserts certain claims relating to the Plaintiffs’ equity investments in Concentric, including allegations that the former management and board members of Concentric engaged in various wrongful acts prior to and/or in conjunction with the merger of Concentric. The lawsuit further alleges that the Company is contractually liable for liquidated damages arising from a pre-merger transaction which the Company previously acknowledged and recorded as an accrued liability. In August 2012, the Company paid the liquidated damages portion of the lawsuit in full by a cash payment of $149,194 to the Plaintiffs. In October 2013, the Company filed a formal response denying liability for any of the Plaintiffs’ remaining claims and intends to vigorously defend against any and all remaining claims asserted under this lawsuit. Any potential judgment against the Company and awarded to the claimant is expected to be immaterial.

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Item 2.        Management's Discussion and Analysis of Financial Condition and Results of Operations

The following management’s discussion and analysis of financial condition and results of operations of the Company (“MD&A”) contains forward-looking statements that involve risks, uncertainties and assumptions including, among others, statements regarding our capital needs, business plans and expectations. In evaluating these statements, you should consider various factors including the risks, uncertainties and assumptions set forth in the reports and other documents we have filed with or furnished to the SEC, including, without limitation, this Quarterly Report on Form 10-Q for the three months ended October 31, 2013 and the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2013 including the consolidated financial statements and related notes contained therein. These factors, or any one of them, may cause our actual results or actions in the future to differ materially from any forward-looking statement made in this document. Refer to “Item 1A. Risk Factors” under Part II - Other Information.

Introduction

This MD&A is focused on material changes in our financial condition from July 31, 2013, our most recent year-end, to October 31, 2013 and our results of operations for the three months ended October 31, 2013 and 2012, and should be read in conjunction with the MD&A contained in our Annual Report on Form 10-K for the fiscal year ended July 31, 2013.

Business

We operate in a single reportable segment and since 2004, as more fully described in our Annual Report on Form 10-K for the fiscal year ended July 31, 2013, we have been engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on uranium projects located in the United States and Paraguay.

We utilize in-situ recovery (“ISR”) mining where possible which we believe, when compared to conventional open pit or underground mining, requires lower capital and operating expenditures with a shorter lead time to extraction and a reduced impact on the environment. We have one uranium mine located in the State of Texas, the Palangana Mine, which utilizes ISR mining and commenced extraction of triuranium octoxide (“U₃O₈”), or yellowcake, in November 2010. We have one uranium processing facility or mill located in the State of Texas, the Hobson Processing Facility, which processes material from the Palangana Mine into drums of U₃O₈, our only sales product and source of revenue, for shipping to a third-party storage and sales facility.

The Hobson Processing Facility has a physical capacity to process two million pounds of U₃O₈ annually and is licensed to process up to one million pounds of U₃O₈ annually, which provides for the capacity to process material from a number of ISR mines. We utilize a “hub-and-spoke” strategy in South Texas whereby the Hobson Processing Facility acts as our central uranium processing site (the “hub”) for the Palangana Mine and for future satellite ISR mines, such as our Goliad Project, (the “spokes”) located within the South Texas Uranium Belt.

We also hold certain mineral exploration interests in various stages in the States of Arizona, Colorado, New Mexico, Texas and Wyoming and in Paraguay, many of which are located in historically successful mining areas and have been the subject of past exploration activities by other mining companies. We do not expect, however, to utilize ISR mining for all of these mineral exploration interests in which case we would expect to rely on conventional open pit and/or underground mining techniques.

Our operating and strategic framework is based on expanding our uranium extraction activities, which includes advancing certain uranium projects with established mineralized materials towards uranium extraction, and establishing additional mineralized materials on our existing uranium projects or through acquisition of additional uranium projects.

On September 5, 2013, we announced our plan to align our operations to adapt to the existing uranium market in a challenging post-Fukushima environment, most notably the uranium spot price being at a seven-year low. As a result, uranium extraction at PAA-1, 2 and 3 of the Palangana Mine operated at a reduced pace during the three months ended October 31, 2013, while any further pre-extraction expenditures were deferred, to maintain operational readiness to ramp-up output in anticipation of a recovery in uranium spot prices. During the three months ended October 31, 2013, pre-extraction activities at other PAAs of the Palangana Mine and at the Goliad Project have continued as planned, and further exploration and permitting activities continued at the Burke Hollow Project.

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On October 23, 2013, we completed a public offering of 3,380,954 units at a price of $2.10 per unit for gross proceeds of $7,100,003 pursuant to a prospectus supplement to the Company’s effective shelf registration statement on Form S-3 previously filed with the SEC. Each unit is comprised of one share of common stock of the Company and 0.55 of one share purchase warrant, each whole warrant exercisable at a price of $2.60 for a three year period to purchase one share of common stock of the Company. The net proceeds from this financing will be used to fund exploration and pre-extraction expenditures at our South Texas projects including the Burke Hollow Project and for general corporate and working capital purposes.

Mineral Rights and Properties

The following is a summary of significant activities by project for the three months ended October 31, 2013:

Texas: Palangana Mine

During the three months ended October 31, 2013, as a result of our plan to align our operations to adapt to the existing uranium market in a challenging post-Fukushima environment, uranium extraction at PAA-1, 2 and 3 of the Palangana Mine and uranium processing at Hobson began to operate at a reduced pace, while any further pre-extraction expenditures relating to existing wellfields were deferred, in order to maintain operational readiness to ramp-up output in anticipation of a recovery in uranium spot prices.

In May 2013, the Mine Permit and Aquifer Exemption amendment applications for future wellfields PAA-4, 5 and 6 were submitted to and acknowledged as being administratively complete by the Texas Commission on Environmental Quality (“TCEQ”), and are currently under advanced technical review. The Radioactive Material License amendment application for PAA-4 and 6 was also submitted to and acknowledged as being administratively complete by the TCEQ, and is currently under advanced technical review. Preparation of Production Area Authorization applications for PAA-5 and 6 are expected to begin upon completion of these amendment applications.

At PAA-4, all monitor wells were sampled for baseline parameters and a pumping test was completed during the fiscal year ended July 31, 2013. In May 2013, the Production Area Authorization application for PAA-4 was submitted to and acknowledged as being administratively complete by the TCEQ, and is currently under advanced technical review.

Texas: Goliad Project

A three-phase electrical power system for the fully-permitted Goliad Project and a large caliche site pad for the main plant complex and disposal well have been constructed. Long-lead items including processing equipment and supplies for the construction of the satellite facility and wellfield began arriving in November 2013.

Texas: Burke Hollow Project

During the three months ended October 31, 2013, two exploration holes totaling 680 feet were drilled at the Burke Hollow Project to depths ranging from a minimum 280 feet to a maximum 400 feet, with an average depth of 340 feet. At October 31, 2013, a total of 294 exploration holes totaling 137,680 feet have been drilled to depths ranging from a minimum 160 feet to a maximum of 940 feet, with an average depth of 465 feet.

At October 31, 2013, a total of 24 regional baseline monitor wells have been installed, with plans to install up to ten more wells in order to establish baseline water quality in both the Goliad 180’ and Goliad 370’ sands. With respect to permitting, a preoperational groundwater characterization sampling program from the drilling of the 24 regional baseline monitor wells commenced in December 2012 and is expected to carry on to the first quarter of the 2014 calendar year. A drainage study of the proposed license boundary encompassing the first three production areas has been completed. An archeology and socioeconomic study has been completed, with an ecology study expected for completion in December 2013. All preoperational groundwater, surface water, soil, sediment and vegetation samples have been collected in preparation for application submittals. The Mine Permit and Radioactive Material License applications are expected to be completed during the first quarter of the 2014 calendar year.

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Arizona: Anderson Project

Historic and recent drilling results are being reviewed for future exploration/delineation activities in the Anderson Project. Permitting plans are also being developed.

Colorado: Slick Rock Project

Based on the uranium resources identified in a technical report completed in February 2013, prepared in accordance with the provisions of National Instrument 43-101, Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators, we plan on completing a Preliminary Economic Assessment for the Slick Rock Project.

Paraguay: Yuty and Coronel Oviedo Projects

Historic and recent drilling results are being reviewed for future exploration/delineation drilling at both the Yuty and Coronel Oviedo Projects. A radon extraction survey is being completed at the Coronel Oviedo Project along the western basin margins, following up on historic airborne radiometric anomalies and outcrop sampling results that indicate a potential for shallow uranium mineralization.

Results of Operations

For the three months ended October 31, 2013 and 2012, we recorded a net loss of $5,879,934 ($0.07 per share) and $7,297,623 ($0.09 per share), respectively. Costs and expenses during the three months ended October 31, 2013 and 2012 were $4,856,051 and $9,461,678, respectively.

Uranium Extraction Activities

During the three months ended October 31, 2013, there were no sales of U₃O₈ completed. During the three months ended October 31, 2012, sales of U₃O₈ totaled 50,000 pounds at $43 per pound under the terms of an existing offtake agreement, fulfilling 50% of the Company’s delivery commitments for the second year, generating revenue from sales of $2,153,250 and corresponding cost of sales of $1,863,109, resulting in a gross profit of $290,141. Cost of sales for U₃O₈ is determined using the average cost per pound in inventory at the end of the month prior to the month in which the sale occurs, plus royalty obligations and other direct selling costs.

During the three months ended October 31, 2013 and 2012, the Palangana Mine extracted 15,000 and 29,000 pounds of U₃O₈ while the Hobson Facility processed 16,000 and 31,000 pounds of U₃O₈, respectively. On September 5, 2013, we announced our plan to align our operations to adapt to the existing uranium market in a challenging post-Fukushima environment, most notably the uranium spot price being at a seven-year low. During the three months ended October 31, 2013, uranium extraction at PAA-1, 2 and 3 of the Palangana Mine and uranium processing at Hobson began to operate at a reduced pace, while any further pre-extraction expenditures relating to existing wellfields were deferred, in order to maintain operational readiness to ramp-up output in anticipation of a recovery in uranium spot prices. While we remain in this state of operational readiness, uranium extraction expenditures directly related to regulatory/mine permit compliance, lease maintenance obligations and maintaining a minimum labor force will be charged to our consolidated statement of operations.

At October 31, 2013, we had a total of 43,000 pounds of U₃O₈ available for sale in inventory. The total value of inventories was $1,401,086, of which $1,331,768 (95%) represents the value of finished goods of U₃O₈, $38,907 (3%) represents the value of work-in-progress and $30,411 (2%) represents the value of supplies. The cash component of the total value of inventories was $1,139,464 and the non-cash component of the total value of inventory was $261,622. At October 31, 2013, a write-down of inventory of $392,149 was recorded to adjust the U₃O₈ inventory balance in finished goods and work-in-progress to net realizable value to reflect the market price of U₃O₈ of $34 per pound at October 31, 2013, less estimated royalties.

At July 31, 2013, we had a total of 27,000 pounds of U₃O₈ available for sale in inventory. The total value of inventories was $975,719, of which $839,588 (86%) represents the value of finished goods of U₃O₈, $72,272 (7%) represents the value of work-in-progress and $63,859 (7%) represents the value of supplies. The cash component of the total value of inventories was $826,997 and the non-cash component of the total value of inventory was $148,722. At July 31, 2013, a write-down of inventory of $425,208 was recorded to adjust the U₃O₈ inventory balance in finished goods and work-in-progress to net realizable value to reflect the market price of U₃O₈ of $35 per pound at July 31, 2013, less estimated royalties.

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Cash and non-cash components of the total value of inventories represent non-GAAP financial measures which we believe are important in evaluating our operating results not only for management but for our investors. We use these measures to compare our performance with other mining companies and rely upon them as part of management’s decision-making process.

Costs and Expenses

During the three months ended October 31, 2013 and 2012, costs and expenses totaled $4,856,051 and $9,461,678, respectively, comprised of, respectively, cost of sales of $Nil and $1,863,109, inventory write-down of $392,149 and $Nil, mineral property expenditures of $1,588,143 and $4,377,285, general and administrative of $2,305,789 and $2,724,937, depreciation, amortization and accretion of $541,079 and $496,347 and impairment loss on mineral properties of $28,891 and $Nil.

Mineral Property Expenditures

During the three months ended October 31, 2013 and 2012, mineral property expenditures totaled $1,588,143 and $4,377,285, respectively. These amounts include expenditures relating to permitting, property maintenance, exploration, pre-extraction and other related activities on the Company’s uranium projects. For the three months ended October 31, 2013, the amount includes uranium extraction expenditures directly related to maintaining operational readiness of $529,448.

The following table is a summary of the mineral property expenditures incurred on the Company’s uranium projects during the three months ended October 31, 2013 and 2012:

		Three Months Ended October 31,
		2013			2012
Mineral Property Expenditures
Palangana Mine	$	671,582		$	1,823,863
Goliad Project		144,971			104,002
Burke Hollow Project		174,298			1,102,932
Channen Project		465			691,262
Anderson Project		84,161			74,722
Workman Creek Project		28,971			30,936
Slick Rock Project		49,025			55,010
Yuty Project		17,825			91,270
Coronel Oviedo Project		84,151			199,801
Other Mineral Property Expenditures		332,694			203,487
	$	1,588,143		$	4,377,285

General and Administrative

During the three months ended October 31, 2013 and 2012, general and administrative expenses totaled $2,305,789 and $2,724,937, respectively, comprised of, respectively, salaries, management and consulting fees of $694,704 and $714,968; office, investor relations, communications and travel of $856,925 and $1,241,465; professional fees of $416,828 and $355,225; and stock-based compensation of $337,332 and $413,279.

The following summary provides a discussion of the major expense categories, including analyses of the factors that caused any significant variances compared to the same period last year:

• For the three months ended October 31, 2013, salaries, management and consulting fees totaled $694,704, which have remained consistent compared with $714,968 for the three months ended October 31, 2012;

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• For the three months ended October 31, 2013, office, investor relations, communication and travel expenses totaled $856,925, a decrease of $384,540 compared with $1,241,465 for the three months ended October 31, 2012. This decrease was primarily the result of our continuing efforts to control and reduce our costs overall;

• For the three months ended October 31, 2013, professional fees totaled $416,828, an increase of $61,603 compared with $355,225 for the three months ended October 31, 2012. This increase was primarily the result of increased professional fees relating to our regulatory filings; and

• For the three months ended October 31, 2013, stock-based compensation totaled $337,332, a decrease of $75,947 compared with $413,279 for the three months ended October 31, 2012. This decrease was primarily the result of a decrease in the number of stock options granted to employees and consultants, partially offset by an increase in common stock issued for consulting services as a result of our continuing efforts to control and reduce our cash outlay.

Depreciation, Amortization and Accretion

During the three months ended October 31, 2013 and 2012, depreciation, amortization and accretion totaled $541,079 and $496,347, respectively. Depreciation, amortization and accretion include depreciation and amortization of long-term assets acquired in the normal course of operations and accretion of asset retirement obligations.

Summary of Quarterly Results

		For the Quarters Ended
		31-Oct-13			31-Jul-13			30-Apr-13			31-Jan-13
Sales	$	-		$	1,980,000		$	2,789,325		$	2,103,750
Net loss		(5,879,934	)		(5,077,213	)		(3,900,045	)		(5,588,210	)
Total comprehensive loss		(5,882,235	)		(5,050,693	)		(3,900,279	)		(5,591,888	)
Basic and diluted loss per share		(0.07	)		(0.06	)		(0.05	)		(0.06	)
Total assets		73,692,104			73,250,001			67,927,245			72,188,198

		For the Quarters Ended
		31-Oct-12			31-Jul-12			30-Apr-12			31-Jan-12
Sales	$	2,153,250		$	7,517,400		$	-		$	3,120,000
Net loss		(7,297,623	)		(4,753,814	)		(8,224,351	)		(6,547,244	)
Total comprehensive loss		(7,298,104	)		(4,791,400	)		(8,225,333	)		(6,546,976	)
Basic and diluted loss per share		(0.09	)		(0.06	)		(0.10	)		(0.09	)
Total assets		76,682,464			85,143,395			88,258,690			62,967,078

Liquidity and Capital Resources

		October 31, 2013			July 31, 2013
Cash and cash equivalents	$	14,698,564		$	14,171,807
Current assets		17,433,489			16,527,822
Current liabilities		7,142,202			5,657,844
Working capital		10,291,287			10,869,978

At October 31, 2013, we had working capital of $10,291,287, a decrease of $578,691 from our working capital of $10,869,978 at July 31, 2013. At October 31, 2013, we had $14,698,564 (July 31, 2013: $14,171,807) in cash and cash equivalents, which represented the largest component of our working capital balance. As a result, our working capital balance will fluctuate significantly as we utilize our cash and cash equivalents to fund our operations including exploration and pre-extraction activities.

On October 23, 2013, we completed a public offering of 3,380,954 units at a price of $2.10 per unit for gross proceeds of $7,100,003 pursuant to a prospectus supplement to the Company’s effective shelf registration statement on Form S-3 previously filed with the SEC. Each unit is comprised of one share of common stock of the Company and 0.55 of one share purchase warrant, each whole warrant exercisable at a price of $2.60 for a three year period to purchase one share of common stock of the Company. The net proceeds from this financing will be used to fund exploration and pre-extraction expenditures at our South Texas projects including the Burke Hollow Project and for general corporate and working capital purposes.

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Historically, we have been reliant primarily on equity financings from the sale of our common stock and, more recently, on debt financing to fund our operations. We have also relied on cash flows generated from our mining activities during Fiscal 2013 and 2012. Our reliance on equity and debt financings is expected to continue for the foreseeable future, and their availability whenever such additional financing is required, will be dependent on many factors, including but not limited to those factors beyond our control such as volatility in the global financial markets affecting our stock price, the status of the worldwide economy and the market price of uranium, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets. We also filed a Form S-3 “Shelf” Registration Statement that became effective September 2, 2011 which provides for the offer and sale of certain securities of the Company from time to time, at our discretion, up to an aggregate public offering of $50 million of which approximately $34.4 million has been utilize in our public offerings which closed on April 10, 2012 and October 23, 2013. We may also be required to seek other forms of financing, such as joint venture arrangements to continue advancing our uranium projects which would depend entirely on finding a suitable third party willing to enter into such an arrangement, typically involving an assignment of a percentage interest in the mineral project. However, there is no assurance that we will be successful in securing any form of additional financing when required and on terms favorable to us.

Our operations are capital intensive, and we will require significant additional financing to acquire additional uranium projects and continue with our exploration and pre-extraction activities. In the absence of such additional financing, we would not be able to fund our operations, including continuing with our exploration and pre-extraction activities, which may result in delay, curtailment or abandonment of any one or all of our uranium projects.

On September 5, 2013, we announced our plan to align our operations to adapt to the existing uranium market in a challenging post-Fukushima environment, most notably the uranium spot price being at a seven-year low. As a result, uranium extraction at PAA-1, 2 and 3 of the Palangana Mine operated at a reduced pace during the three months ended October 31, 2013, while any further pre-extraction expenditures were deferred, to maintain operational readiness to ramp-up output in anticipation of a recovery in uranium spot prices. We do not expect to rely on cash flows generated from our mining activities for Fiscal 2014 to the extent relied upon during Fiscal 2013 and 2012.

Existing cash resources and available sources of financing are expected to provide sufficient funds to meet our obligations and carry out our plan of operations for the next twelve months.

Our anticipated exploration and pre-extraction activities, however, will be dependent on and may change as a result of our financial position, the market price of uranium and other considerations, and such change may include accelerating the pace of reducing our operations as originally announced on September 5, 2013, as well as broadening the scope of these reductions. Our ability to secure funding for these activities will be impacted by our operating performance, other uses of cash, the market price of uranium, the market price of our common stock, our ability to secure adequate financing and other factors which may be beyond our control. Specific examples of such factors include, but are not limited to:

• if the weakness in the market price of uranium experienced in Fiscal 2013 continues or weakens further during Fiscal 2014, it may have a negative effect on our decision to continue with our exploration and pre- extraction activities;
• if we are unable to or decide not to draw-down further on the $20,000,000 senior secured credit facility, under which we received initial funding of $10,000,000, with an additional $5,000,000 available for draw- down on or before January 31, 2014 and a further additional $5,000,000 available for draw-down on or before July 31, 2014, it would adversely affect our financial position, and our ability to continue with our exploration and pre-extraction activities; and
• if the weakness in the market price of our common stock experienced in Fiscal 2013 continues or weakens further for Fiscal 2014, it would affect our ability to secure adequate financing to continue with our exploration and pre-extraction activities.

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Our continuation as a going concern for a period longer than twelve months will be dependent upon our ability to obtain adequate additional financing, as future capital expenditures are expected to be substantial.

Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional uranium projects and continue with exploration and pre-extraction activities and mining activities on our existing uranium projects, will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our operations by establishing ore bodies that contain commercially recoverable uranium and to develop these into profitable mining activities. The economic viability of our mining activities, including the expected duration and profitability of the Palangana Mine and of any future satellite ISR mines, such as the Goliad Project, located within the South Texas Uranium Belt, has many risks and uncertainties. These include, but are not limited to: (i) a significant, pro-longed decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. Our mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in profitable mining activities.

Operating Activities

Net cash used in operating activities during the three months ended October 31, 2013 was $5,892,195 (three months ended October 31, 2012: $7,721,834). Significant operating expenditures included uranium extraction costs, mineral property expenditures and general and administrative expenses.

Financing Activities

Net cash provided by financing activities during the three months ended October 31, 2013 was $6,525,180 (three months ended October 31, 2012: $6,302) resulting from net cash of $6,691,003 received from the issuance of common shares from the equity financing and $22,501 received from the exercise of stock options (three months ended October 31, 2012: $39,748 from exercise of stock options), offset primarily by payments for debt financing costs of $188,107 (three months ended October 31, 2012: $Nil).

Investing Activities

Net cash used in investing activities during the nine months ended October 31, 2013 was $106,228 (three months ended October 31, 2013: $112,634), resulting primarily from the acquisition of mineral rights and properties of $83,823 (three months ended October 31, 2012: $7,396) and purchase of property, plant and equipment of $21,895 (three months ended October 31, 2012: $103,190).

Stock Options and Warrants

At October 31, 2013, the Company had stock options outstanding to purchase 8,819,486 shares and share purchase warrants outstanding to purchase 5,009,524 shares. The outstanding stock options have a weighted average exercise price of $2.02 per share and the outstanding warrants have a weighted average exercise price of $2.38 per share. At October 31, 2013, outstanding stock options and warrants totaled 13,829,010 shares issuable for gross proceeds of approximately $29,711,000 should these options and warrants be exercised in full. At October 31, 2013, outstanding in-the-money stock options and warrants totaled 3,307,288 shares issuable for gross proceeds of approximately $1,796,000 should these options and warrants be exercised in full. The exercise of these stock options and warrants is at the discretion of the respective holders and there is no assurance that any of these stock options or warrants will be exercised in the future.

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Transactions with Directors and Officers

During the three months ended October 31, 2013, the Company had transactions with certain officers and directors of the Company as follows:

• Incurred $37,403 (three months ended October 31, 2012: $48,433) in general and administrative costs paid to a company controlled by a direct family member of a director and officer; and
• Incurred $9,000 (three months ended October 31, 2012: $9,000) in consulting fees paid to a company controlled by a director of the Company.

At October 31, 2013, amounts due to related parties totaled $9,354 (July 31, 2013: $9,571). These amounts are unsecured, non-interest bearing and due on demand.

Material Commitments

Material commitments of the Company since the filing of the Form 10-K for the fiscal year ended July 31, 2013 changed by the following:

• Fixed contract commitments for office space have decreased by $26,000 during the three months ended October 31, 2013; and
• Commitments for consulting agreements have decreased by $30,000 as a result of terminating, entering into and renewing existing consulting agreements.

Effective October 31, 2013, a delivery commitment of 30,000 pounds of U₃O₈ remaining under an existing offtake agreement for completion no later than July 31, 2014 was cancelled without penalty.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Critical Accounting Policies

The Company’s significant accounting policies are disclosed in Note 2: Summary of Significant Accounting Policies of the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended July 31, 2013.

Refer to Critical Accounting Policies under Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended July 31, 2013.

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Item 3.        Quantitative and Qualitative Disclosures About Market Risk

Refer to Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for the fiscal year ended July 31, 2013.

Item 4.        Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Principal Executive Officer and Principal Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of the end of the period covered by this report. Based on such evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.

It should be noted that any system of controls is based in part upon certain assumptions designed to obtain reasonable (and not absolute) assurance as to its effectiveness, and there can be no assurance that any design will succeed in achieving its stated goals.

Changes in Internal Controls

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our fiscal quarter ended October 31, 2013, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1.        Legal Proceedings

As of the date of this Quarterly Report, other than as disclosed below, there are no material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which the Company or any of its subsidiaries is a party or of which any of their property is subject, and no director, officer, affiliate or record or beneficial owner of more than 5% of our common stock, or any associate or any such director, officer, affiliate or security holder, is (i) a party adverse to us or any of our subsidiaries in any legal proceeding or (ii) has an adverse interest to us or any of our subsidiaries in any legal proceeding. Other than as disclosed below, management is not aware of any other material legal proceedings pending or that have been threatened against us or our properties.

On or about March 9, 2011, the Texas Commission on Environmental Quality (the “TCEQ”) granted the Company’s applications for a Class III injection well, Production Area Authorization and Aquifer Exemption permits for its Goliad Project. On or about December 4, 2012, the U.S. Environmental Protection Agency (the “EPA”) concurred with the TCEQ issuance of the Aquifer Exemption permit. With the receipt of this concurrence, the final authorization required for uranium extraction, the Goliad Project achieved fully-permitted status. On or about May 24, 2011, a group of petitioners, inclusive of Goliad County, appealed the TCEQ action to the 250^th District Court in Travis County, Texas. The petitioners’ appeal lay dormant until on or about June 14, 2013, when the petitioners filed their initial brief in support of their position. The Company has, since inception, successfully intervened as a party. On or about January 18, 2013, a different group of petitioners, exclusive of Goliad County, filed a petition for review with the Court of Appeals for the Fifth Circuit in the United States to appeal the EPA’s decision. On or about March 5, 2013, a motion filed by the Company to intervene in this matter was granted by the court. The parties are attempting to resolve both appeals and, to facilitate discussions and to avoid further legal costs, the parties have jointly agreed, through mediation which was initially conducted through the Fifth Circuit on or about August 8, 2013, to abate the proceedings in the State District Court; which was approved by the State District Court on or about August 21, 2013. The Company continues to believe that the pending appeals are without merit and is continuing forward as planned towards uranium extraction at its fully-permitted Goliad Project.

On or about April 3, 2012, the Company received notification of a lawsuit filed in the State of Arizona, in the Superior Court for the County of Yavapai, by certain Petitioners (the “Plaintiffs”) against a group of defendants, including the Company and former management and board members of Concentric. The lawsuit asserts certain claims relating to the Plaintiffs’ equity investments in Concentric, including allegations that the former management and board members of Concentric engaged in various wrongful acts prior to and/or in conjunction with the merger of Concentric. The lawsuit further alleges that the Company is contractually liable for liquidated damages arising from a pre-merger transaction which the Company previously acknowledged and recorded as an accrued liability. In August 2012, the Company paid the liquidated damages portion of the lawsuit in full by a cash payment of $149,194 to the Plaintiffs. In October 2013, the Company filed a formal response denying liability for any of the Plaintiffs’ remaining claims and intends to vigorously defend against any and all remaining claims asserted under this lawsuit. Any potential judgment against the Company and awarded to the claimant is expected to be immaterial.

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Item 1A.      Risk Factors

In addition to the information contained in our Form 10-K Annual Report for the fiscal year ended July 31, 2013 and this Form 10-Q Quarterly Report, the following list of material risks and uncertainties should be carefully reviewed by our stockholders and any potential investors in evaluating our Company, our business and the market value of our common stock. Any one of these risks and uncertainties has the potential to cause material adverse effects on our business, prospects, financial condition and operating results which could cause actual results to differ materially from any forward-looking statements expressed by us and a significant decrease in the market price of our common stock. Refer to “Forward-Looking Statements” as disclosed in our Form 10-K Annual Report for the fiscal year ended July 31, 2013.

There is no assurance that we will be successful in preventing the material adverse effects that any of the following risks and uncertainties may cause, or that these potential risks and uncertainties are a complete list of the risks and uncertainties facing us. Furthermore, there may be additional risks and uncertainties that we are presently unaware of, or presently consider immaterial, that may become material in the future and have a material adverse effect on us. You could lose all or a significant portion of your investment due to any of these risks and uncertainties.

Risks Related to Our Company and Business

Evaluating our future performance may be difficult since we have a limited financial and operating history, with significant negative cash flow and net losses to date. Furthermore, our long-term success will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our mining activities.

Uranium Energy Corp. was incorporated under the laws of the State of Nevada on May 16, 2003 and since 2004, we have been engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing on projects located in the United States and Paraguay. In November 2010, we commenced uranium extraction utilizing in-situ recovery for the first time at the Palangana Mine and processed those materials at the Hobson Facility into drums of U₃O₈, our only sales product and source of revenue. We generated revenues from sales of U₃O₈ during Fiscal 2013 and 2012, with no revenues generated prior to Fiscal 2012. We also hold uranium projects in various stages of exploration and pre-extraction in the States of Arizona, Colorado, New Mexico, Texas and Wyoming and in Paraguay.

We have a history of significant negative cash flow and accumulated deficit since inception to October 31, 2013 of $148.6 million, incurring a net loss of $5.9 million for the three months ended October 31, 2013. For Fiscal 2013, 2012 and 2011, we incurred net losses of $21.9 million, $25.1 million and $27.4 million, respectively. Although we generated revenues from sales of uranium concentrates during Fiscal 2013 and 2012 of $9.0 million and $13.8 million, respectively, we have yet to achieve profitability or develop positive cash flow from operations. Furthermore, we do not expect to achieve profitability or develop positive cash flow from operations in the near term, which may never happen. Historically, we have been reliant primarily on equity financings and, more recently, on debt financing to fund our operations and we expect this reliance to continue for the foreseeable future. As a result of our limited financial and operating history, including our significant negative cash flow and net losses to date, it may be difficult to evaluate our future performance.

Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional uranium projects and continue with exploration, pre-extraction and mining activities on our existing uranium projects, will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our operations by establishing ore bodies that contain commercially recoverable uranium and to develop these into profitable mining activities. The economic viability of our mining activities has many risks and uncertainties including, but not limited to: (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vi) the introduction of significantly more stringent regulatory laws and regulations. Our mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in profitable mining activities.

Our operations are capital intensive, and we will require significant additional financing to acquire additional uranium projects and continue with our exploration and pre-extraction activities on our existing uranium projects. There is no assurance, however, that we will be successful in securing any form of additional financing when required and on terms favorable to us.

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Our operations are capital intensive, and we will require significant additional financing to acquire additional uranium projects and continue with our exploration and pre-extraction activities which include assaying, drilling, geological and geochemical analysis and mine construction costs. In the absence of such additional financing, we would not be able to fund our operations, including continuing with our exploration and pre-extraction activities, which may result in delay, curtailment or abandonment of any one or all of our uranium projects.

Historically, we have been reliant primarily on equity financings from the sale of our common stock and, more recently, on debt financing to fund our operations. We have filed a Form S-3 “Shelf” Registration Statement that became effective September 2, 2011 which provides for the public offer and sale of certain securities of our Company from time to time, at our discretion, for gross proceeds of up to $50 million. Pursuant to the Registration Statement, we completed a public offering of shares for gross proceeds of approximately $22.5 million on April 10, 2012, and an additional public offering of units consisting of shares and warrants for gross proceeds of approximately $7.1 million on October 23, 2013. We have also entered into a Credit Agreement dated July 30, 2013 which provides for a $20 million secured credit facility, pursuant to which we have drawn down $10 million in principal.

Although we have also generated cash flow from our mining activities during Fiscal 2013 and 2012, our reliance on equity and debt financings is expected to continue for the foreseeable future. We caution that the availability of future financing will be dependent on many factors, including but not limited to general market conditions and the market value of our common stock. We may also be required to seek other forms of financing, such as joint venture arrangements, to continue advancing our uranium projects. A joint venture would depend entirely on our ability to find one or more suitable third parties willing to enter into such an arrangement, and would typically require us to assign a percentage interest in the mineral project to the joint venture participants.

Factors beyond our control such as, but not limited to, volatility in the global financial markets affecting our stock price, the status of the worldwide economy and the market price of uranium may pose significant challenges to our ability to access additional financing, including access to the equity and credit markets. There is no assurance that we will be successful in securing any form of additional financing when required and on terms favorable to us.

Restrictive covenants in the credit agreement governing our indebtedness may restrict our ability to pursue our business strategies.

Under our $20 million secured credit facility, we received initial funding in the amount of $10 million, with an additional $5 million available for draw-down pursuant to a second advance and a further additional $5 million available for draw-down pursuant to a third advance, in each case in accordance with the terms of a credit agreement. The credit agreement includes restrictive covenants that, among other things, limit our ability to sell the assets securing our indebtedness or to incur additional indebtedness other than permitted indebtedness, which may restrict our ability to pursue certain business strategies from time to time. If we do not comply with these covenants, we could be in default which, if not addressed or waived, could require accelerated repayment of our indebtedness.

If we are unable to service our indebtedness, we could lose the assets securing our indebtedness.

Our ability to make scheduled payments depends on our financial condition and operating performance, which are subject to prevailing economic, competitive, legislative and regulatory conditions beyond our control. We may be unable to generate a level of cash flow from operating activities sufficient to permit us to pay the principal, interest and standby fees on our indebtedness.

If we cannot make scheduled payments on our debt, we will be in default which, if not addressed or waived, could require accelerated repayment of our indebtedness and the enforcement by the lenders against the assets securing our indebtedness. Our credit facility is secured by our Hobson Processing Facility and the Goliad mineral leases, and in the event of the advance of the final $5 million, would be required to be secured by our Palangana mineral leases. These are key assets on which our business is substantially dependent and as such, the enforcement against any one or all of these assets would have a material adverse effect on our operations and financial condition.

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Our uranium extraction and sales history is limited, with our uranium extraction originating from a single uranium mine. Our ability to continue generating revenue is subject to a number of factors, any one or more of which may adversely affect our revenues, results of operations and financial condition.

We have a limited history of uranium extraction and generating revenue. In November 2010, we commenced uranium extraction at a single uranium mine, the Palangana Mine, which has been our sole source for the uranium concentrates sold to generate our revenues during Fiscal 2013 and 2012, with no revenues generated prior to Fiscal 2012. Our ability to continue generating revenue from the Palangana Mine is subject to a number of factors which include, but are not limited to, (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. Furthermore, continued mining activities at the Palangana Mine will eventually deplete the Palangana Mine or become uneconomical, and if we are unable to directly acquire or develop our existing uranium projects into additional uranium mines from which we can commence uranium extraction, it will negatively impact our ability to continue generating revenues. Any one or more of these occurrences may adversely affect our results of operations and financial condition.

Uranium exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, and actual results may differ significantly from expectations or anticipated amounts. Furthermore, exploration programs conducted on our uranium projects may not result in the establishment of ore bodies that contain commercially recoverable uranium.

Uranium exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, many beyond our control, including, but not limited to: (i) unanticipated ground and water conditions and adverse claims to water rights; (ii) unusual or unexpected geological formations; (iii) metallurgical and other processing problems; (iv) the occurrence of unusual weather or operating conditions and other force majeure events; (v) lower than expected ore grades; (vi) industrial accidents; (vii) delays in the receipt of or failure to receive necessary government permits; (viii) delays in transportation; (ix) availability of contractors and labor; (x) government permit restrictions and regulation restrictions; (xi) unavailability of materials and equipment; and (xii) the failure of equipment or processes to operate in accordance with specifications or expectations. These risks and uncertainties could result in: delays, reductions or stoppages in our mining activities; increased capital and/or extraction costs; damage to, or destruction of, our mineral projects, extraction facilities or other properties; personal injuries; environmental damage; monetary losses; and legal claims.

Success in uranium exploration is dependent on many factors, including, without limitation, the experience and capabilities of a company’s management, the availability of geological expertise and the availability of sufficient funds to conduct the exploration program. Even if an exploration program is successful and commercially recoverable uranium is established, it may take a number of years from the initial phases of drilling and identification of the mineralization until extraction is possible, during which time the economic feasibility of extraction may change such that the uranium ceases to be economically recoverable. Uranium exploration is frequently non-productive due, for example, to poor exploration results or the inability to establish ore bodies that contain commercially recoverable uranium, in which case the uranium project may be abandoned and written-off. Furthermore, we will not be able to benefit from our exploration efforts and recover the expenditures that we incur on our exploration programs if we do not establish ore bodies that contain commercially recoverable uranium and develop these uranium projects into profitable mining activities, and there is no assurance that we will be successful in doing so for any of our uranium projects.

Whether an ore body contains commercially recoverable uranium depends on many factors including, without limitation: (i) the particular attributes, including material changes to those attributes, of the deposit such as size, grade, recovery rates and proximity to infrastructure; (ii) the market price of uranium, which may be volatile; and (iii) government regulations and regulatory requirements including, without limitation, those relating to environmental protection, permitting and land use, taxes, land tenure and transportation.

We have not established proven or probable reserves through the completion of a “final” or “bankable” feasibility study for any of our uranium projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing in-situ recovery (“ISR”) mining, such as the Palangana Mine. Since we commenced extraction of mineralized materials at the Palangana Mine without having established proven and probable reserves, it may result in our mining activities at the Palangana Mine, and at any future uranium projects for which proven and probable reserves are not established, being inherently riskier than other mining activities for which proven and probable reserves have been established.

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We have established the existence of mineralized materials for certain uranium projects, including the Palangana Mine. We have not established proven or probable reserves, as defined by the SEC under Industry Guide 7, through the completion of a “final” or “bankable” feasibility study for any of our uranium projects, including the Palangana Mine. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing ISR mining, such as the Palangana Mine. Since we commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated. Any mineralized materials established or extracted from the Palangana Mine should not be in any way associated with having established or produced from proven or probable reserves.

Since we are in the Exploration Stage, pre-production expenditures including those related to pre-extraction activities are expensed as incurred, the effects of which may result in our consolidated financial statements not being directly comparable to the financial statements of companies in the Production Stage.

Despite the fact that we commenced uranium extraction at the Palangana Mine in November 2010, we remain in the Exploration Stage as defined under Industry Guide 7, and will continue to remain in the Exploration Stage until such time proven or probable reserves have been established, which may never occur. We prepare our consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”) under which acquisition costs of mineral rights are initially capitalized as incurred while pre-production expenditures are expensed as incurred until such time we exit the Exploration Stage. Expenditures relating to exploration activities are expensed as incurred and expenditures relating to pre-extraction activities are expensed as incurred until such time proven or probable reserves are established for that uranium project, after which subsequent expenditures relating to mine development activities for that particular project are capitalized as incurred.

We have neither established nor have any plans to establish proven or probable reserves for our uranium projects for which we plan on utilizing ISR mining, such as the Palangana Mine. Companies in the Production Stage as defined by the SEC under Industry Guide 7, having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. As we are in the Exploration Stage, it has resulted in us reporting larger losses than if we had been in the Production Stage due to the expensing, instead of capitalizing, of expenditures relating to ongoing mill and mine pre-extraction activities. Additionally, there would be no corresponding amortization allocated to our future reporting periods 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 we had been in the Production Stage. Any capitalized costs, such as acquisition costs of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage.

We have recorded estimated reclamation obligations relating to our uranium projects which may be exceeded by the actual reclamation costs when incurred in the future.

We are responsible for certain reclamation obligations in the future, primarily for the Hobson Facility and the Palangana Mine, and have recorded a liability on our balance sheet to recognize such estimated reclamation costs. There is a risk, however, that the actual reclamation costs when incurred in the future will exceed the estimated amounts recorded, which will adversely affect our results of operations and financial performance.

We do not insure against all of the risks we face in our operations.

In general, where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. We currently maintain insurance against general commercial liability claims and certain physical assets used in our operations, subject to exclusions and limitations, however, we do not maintain insurance to cover all of the potential risks and hazards associated with our operations. We may be subject to liability for environmental, pollution or other hazards associated with our exploration, pre-extraction and extraction activities, which risks may not be insured against, which may exceed the limits of our insurance coverage or which we may elect not to insure against because of high premiums or other reasons. Furthermore, we cannot provide assurance that any insurance coverage we currently have will continue to be available at reasonable premiums or that such insurance will adequately cover any resulting liability.

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Acquisitions that we may make from time to time could have an adverse impact on us.

From time to time, we examine opportunities to acquire additional mining assets and businesses. Any acquisition that we may choose to complete may be of a significant size, may change the scale of our business and operations, and may expose us to new geographic, political, operating, financial and geological risks. Our success in our acquisition activities depends on our ability to identify suitable acquisition candidates, negotiate acceptable terms for any such acquisition, and integrate the acquired operations successfully with those of our Company. Any acquisitions would be accompanied by risks which could have a material adverse effect on our business. For example, there may be a significant change in commodity prices after we have committed to complete the transaction and established the purchase price or exchange ratio; a material ore body may prove to be below expectations; we may have difficulty integrating and assimilating the operations and personnel of any acquired companies, realizing anticipated synergies and maximizing the financial and strategic position of the combined enterprise, and maintaining uniform standards, policies and controls across the organization; the integration of the acquired business or assets may disrupt our ongoing business and our relationships with employees, customers, suppliers and contractors; and the acquired business or assets may have unknown liabilities which may be significant. In the event that we choose to raise debt capital to finance any such acquisition, our leverage will be increased. If we choose to use equity as consideration for such acquisition, existing shareholders may suffer dilution. Alternatively, we may choose to finance any such acquisition with our existing resources. There can be no assurance that we would be successful in overcoming these risks or any other problems encountered in connection with such acquisitions.

The uranium industry is subject to numerous stringent laws, regulations and standards, including environmental protection laws and regulations. If any changes occur that would make these laws, regulations and standards more stringent, it may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

Uranium exploration and pre-extraction programs and mining activities are subject to numerous stringent laws, regulations and standards at the federal, state, and local levels governing permitting, pre-extraction, extraction, exports, taxes, labor standards, occupational health, waste disposal, protection and reclamation of the environment, protection of endangered and protected species, mine safety, hazardous substances and other matters. Our compliance with these requirements requires significant financial and personnel resources.

The laws, regulations, policies or current administrative practices of any government body, organization or regulatory agency in the United States or any other applicable jurisdiction, may change or be applied or interpreted in a manner which may also have a material adverse effect on our operations. The actions, policies or regulations, or changes thereto, of any government body or regulatory agency or special interest group, may also have a material adverse effect on our operations.

Uranium exploration and pre-extraction programs and mining activities are subject to stringent environmental protection laws and regulations at the federal, state, and local levels. These laws and regulations, which include permitting and reclamation requirements, regulate emissions, water storage and discharges and disposal of hazardous wastes. Uranium mining activities are also subject to laws and regulations which seek to maintain health and safety standards by regulating the design and use of mining methods. Various permits from governmental and regulatory bodies are required for mining to commence or continue, and no assurance can be provided that required permits will be received in a timely manner.

Our compliance costs including the posting of surety bonds associated with environmental protection laws and regulations and health and safety standards have been significant to date, and are expected to increase in scale and scope as we expand our operations in the future. Furthermore, environmental protection laws and regulations may become more stringent in the future, and compliance with such changes may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

To the best of our knowledge, our operations are in compliance, in all material respects, with all applicable laws, regulations and standards. If we become subject to liability for any violations, we may not be able or may elect not to insure against such risk due to high insurance premiums or other reasons. Where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. However, we cannot provide any assurance that such insurance will continue to be available at reasonable premiums or that such insurance will be adequate to cover any resulting liability.

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We may not be able to obtain or maintain necessary licenses.

Our exploration and mining activities are dependent upon the grant of appropriate authorizations, licences, permits and consents, as well as continuation of these authorizations, licences, permits and consents already granted, which may be granted for a defined period of time, or may not be granted or may be withdrawn or made subject to limitations. There can be no assurance that all necessary authorizations, licences, permits and consents will be granted to us, or that authorizations, licences, permits and consents already granted will not be withdrawn or made subject to limitations.

Major nuclear incidents may have adverse effects on the nuclear and uranium industries.

The nuclear incident that occurred in Fukushima, Japan in March 2011 had significant and adverse effects on both the nuclear and uranium industries. If another nuclear incident were to occur, it may have further adverse effects for both industries. Public opinion of nuclear power as a source of electricity generation may be adversely affected, which may cause governments of certain countries to further increase regulation for the nuclear industry, reduce or abandon current reliance on nuclear power or reduce or abandon existing plans for nuclear power expansion. Any one of these occurrences has the potential to reduce current and/or future demand for nuclear power, resulting in lower demand for uranium and lower market prices for uranium, adversely affecting the Company’s operations and prospects. Furthermore, the growth of the nuclear and uranium industries is dependent on continuing and growing public support of nuclear power as a source of electricity generation.

The marketability of uranium concentrates will be affected by numerous factors beyond our control which may result in our inability to receive an adequate return on our invested capital.

The marketability of uranium concentrates extracted by us will be affected by numerous factors beyond our control. These factors include macroeconomic factors, fluctuations in the market price of uranium, governmental regulations, land tenure and use, regulations concerning the importing and exporting of uranium and environmental protection regulations. The future effects of these factors cannot be accurately predicted, but any one or a combination of these factors may result in our inability to receive an adequate return on our invested capital.

The uranium industry is highly competitive and we may not be successful in acquiring additional projects.

The uranium industry is highly competitive, and our competition includes larger, more established companies with longer operating histories that not only explore for and produce uranium, but also market uranium and other products on a regional, national or worldwide basis. Due to their greater financial and technical resources, we may not be able to acquire additional uranium projects in a competitive bidding process involving such companies. Additionally, these larger companies have greater resources to continue with their operations during periods of depressed market conditions.

We hold mineral rights in foreign jurisdictions which could be subject to additional risks due to political, taxation, economic and cultural factors.

We hold certain mineral rights located in Paraguay through the acquisition of Piedra Rica Mining S.A. and Transandes Paraguay S.A., both companies incorporated in Paraguay. Operations in foreign jurisdictions outside of the U.S. and Canada, especially in developing countries, may be subject to additional risks as they may have different political, regulatory, taxation, economic and cultural environments that may adversely affect the value or continued viability of our rights. These additional risks include, but are not limited to: (i) changes in governments or senior government officials; (ii) changes to existing laws or policies on foreign investments, environmental protection, mining and ownership of mineral interests; (iii) renegotiation, cancellation, expropriation and nationalization of existing permits or contracts; (iv) foreign currency controls and fluctuations; and (v) civil disturbances, terrorism and war.

In the event of a dispute arising at our foreign operations in Paraguay, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of the courts in the United States or Canada. We may also be hindered or prevented from enforcing our rights with respect to a government entity or instrumentality because of the doctrine of sovereign immunity. Any adverse or arbitrary decision of a foreign court may have a material and adverse impact on our business, prospects, financial condition and results of operations.

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There is no guarantee that title to our mineral property interests will not be challenged.

Although we have taken reasonable measures to ensure proper title to our interests in mineral properties and other assets, there is no guarantee that the title to any of such interests will not be challenged. No assurance can be given that we will be able to secure the grant or the renewal of existing mineral rights and tenures on terms satisfactory to us, or that governments in the jurisdictions in which we operate will not revoke or significantly alter such rights or tenures or that such rights or tenures will not be challenged or impugned by third parties, including local governments, aboriginal peoples or other claimants. Our mineral properties may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. A successful challenge to the precise area and location of our claims could result in us being unable to operate on our properties as permitted or being unable to enforce our rights with respect to our properties.

Due to the nature of our business, we may be subject to legal proceedings which may divert management’s time and attention from our business and result in substantial damage awards.

Due to the nature of our business, we may be subject to numerous regulatory investigations, civil claims, lawsuits and other proceedings in the ordinary course of our business including those described in our most recent annual report on Form 10-K, under Item 3. Legal Proceedings, and in this quarterly report on Form 10-Q, under Part II, Item 1. Legal Proceedings. No reserves have been established for any potential liability relating to these lawsuits. The outcome of these lawsuits is uncertain and subject to inherent uncertainties, and the actual costs to be incurred will depend upon many unknown factors. We may be forced to expend significant resources in the defense of these suits, and we may not prevail. Defending against these and other lawsuits in the future may not only require us to incur significant legal fees and expenses, but may become time-consuming for us and detract from our ability to fully focus our internal resources on our business activities. The results of any legal proceeding cannot be predicted with certainty due to the uncertainty inherent in litigation, the difficulty of predicting decisions of regulators, judges and juries and the possibility that decisions may be reversed on appeal. There can be no assurances that these matters will not have a material adverse effect on our business, results of operations or financial position.

We depend on certain key personnel, and our success will depend on our continued ability to retain and attract such qualified personnel.

Our success is dependent on the efforts, abilities and continued service of certain senior officers and key employees and consultants. A number of our key employees and consultants have significant experience in the uranium industry. A loss of service from any one of these individuals may adversely affect our operations, and we may have difficulty or may not be able to locate and hire a suitable replacement.

Certain directors and officers may be subject to conflicts of interest.

The majority of our directors and officers are involved in other business ventures including similar capacities with other private or publicly-traded companies. Such individuals may have significant responsibilities to these other business ventures, including consulting relationships, which may require significant amounts of their available time. Conflicts of interest may include decisions on how much time to devote to our business affairs and what business opportunities should be presented to us. Our Code of Business Conduct for Directors, Officers and Employees provides for guidance on conflicts of interest.

The laws of the State of Nevada and our Articles of Incorporation may protect our directors and officers from certain types of lawsuits.

The laws of the State of Nevada provide that our directors and officers will not be liable to the Company or its stockholders for monetary damages for all but certain types of conduct as directors and officers of the Company. Our Bylaws provide for broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. These indemnification provisions may require us to use our limited assets to defend our directors and officers against claims, and may have the effect of preventing stockholders from recovering damages against our directors and officers caused by their negligence, poor judgment or other circumstances.

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Several of our directors and officers are residents outside of the U.S., and it may be difficult for stockholders to enforce within the U.S. any judgments obtained against such directors or officers.

Several of our directors and officers are nationals and/or residents of countries other than the U.S., and all or a substantial portion of such persons' assets are located outside of the U.S. As a result, it may be difficult for investors to effect service of process on such directors and officers, or enforce within the U.S. any judgments obtained against such directors and officers, including judgments predicated upon the civil liability provisions of the securities laws of the U.S. or any state thereof. Consequently, stockholders may be effectively prevented from pursuing remedies against such directors and officers under U.S. federal securities laws. In addition, stockholders may not be able to commence an action in a Canadian court predicated upon the civil liability provisions under U.S. federal securities laws. The foregoing risks also apply to those experts identified in this document that are not residents of the U.S.

Disclosure controls and procedures and internal control over financial reporting, no matter how well designed and operated, are designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness.

Management’s evaluation on the effectiveness of disclosure controls and procedures is designed to ensure that information required for disclosure in our public filings is recorded, processed, summarized and reported on a timely basis to our senior management, as appropriate, to allow timely decisions regarding required disclosure. Management’s report on internal control over financial reporting is designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use and transactions are properly recorded and reported. Any system of controls, no matter how well designed and operated, is based in part upon certain assumptions designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness.

Risks Related to Our Common Stock

Historically, the market price of our common stock has been and may continue to fluctuate significantly.

On September 28, 2007, our common stock commenced trading on the NYSE MKT (formerly known as the American Stock Exchange and the NYSE Amex Equities Exchange) and prior to that, traded on the OTC Bulletin Board.

The global markets have experienced significant and increased volatility, especially over the recent past, which have been impacted by the effects of mass sub-prime mortgage defaults and liquidity problems of the asset-backed commercial paper market, resulting in a number of large financial institutions requiring government bailouts or filing for bankruptcy. The effects of these past events and any similar events in the future may continue to or further affect the global markets, which may directly affect the market price of our common stock and our accessibility for additional financing. Although this volatility may be unrelated to specific company performance, it can have an adverse effect on the market price of our shares which, historically, has fluctuated significantly and may continue to do so in the future.

In addition to the volatility associated with general economic trends and market conditions, the market price of our common stock could decline significantly due to the impact of any one or more events, including, but not limited to, the following: (i) volatility in the uranium market; (ii) occurrence of a major nuclear incident such as the events in Fukushima, Japan in March 2011; (iii) changes in the outlook for the nuclear power and uranium industries; (iv) failure to meet market expectations on our exploration, pre-extraction or extraction activities, including abandonment of key uranium projects; (v) sales of a large number of our shares held by certain stockholders including institutions and insiders; (vi) downward revisions to previous estimates on us by analysts; (vii) removal from market indices; (viii) legal claims brought forth against us; and (ix) introduction of technological innovations by competitors or in competing technologies.

A prolonged decline in the market price of our common stock could affect our ability to obtain additional financing which would adversely affect our operations.

Historically, we have relied on equity financing and more recently, on debt financing, as primary sources of financing. A prolonged decline in the market price of our common stock or a reduction in our accessibility to the global markets may result in our inability to secure additional financing which would have an adverse effect on our operations.

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Additional issuances of our common stock may result in significant dilution to our existing shareholders and reduce the market value of their investment.

We are authorized to issue 750,000,000 shares of common stock of which 89,611,281 shares were issued and outstanding as of October 31, 2013. Future issuances for financings, mergers and acquisitions, exercise of stock options and share purchase warrants and for other reasons may result in significant dilution to and be issued at prices substantially below the price paid for our shares held by our existing stockholders. Significant dilution would reduce the proportionate ownership and voting power held by our existing stockholders, and may result in a decrease in the market price of our shares.

We also filed a Form S-3 “Shelf” Registration Statement that became effective September 2, 2011 which provides for the offer and sale of certain securities of the Company from time to time, at its discretion, up to an aggregate public offering of $50 million, of which approximately $34.4 million has been utilized (approximately $22.5 million pursuant to an offering of shares on April 10, 2012, approximately $7.1 million pursuant to an offering of units consisting of shares and warrants on October 23, 2013, and approximately $4.8 million representing the aggregate exercise price to purchase warrant shares upon exercise of the warrants issued as part of such units).

We are subject to the Continued Listing Criteria of the NYSE MKT and our failure to satisfy these criteria may result in delisting of our common stock.

Our common stock is currently listed on the NYSE MKT. In order to maintain this listing, we must maintain certain share prices, financial and share distribution targets, including maintaining a minimum amount of shareholders’ equity and a minimum number of public shareholders. In addition to these objective standards, the NYSE MKT may delist the securities of any issuer if, in its opinion, the issuer’s financial condition and/or operating results appear unsatisfactory; if it appears that the extent of public distribution or the aggregate market value of the security has become so reduced as to make continued listing on the NYSE MKT inadvisable; if the issuer sells or disposes of principal operating assets or ceases to be an operating company; if an issuer fails to comply with the NYSE MKT’s listing requirements; if an issuer’s common stock sells at what the NYSE MKT considers a “low selling price” and the issuer fails to correct this via a reverse split of shares after notification by the NYSE MKT; or if any other event occurs or any condition exists which makes continued listing on the NYSE MKT, in its opinion, inadvisable.

If the NYSE MKT delists our common stock, investors may face material adverse consequences, including, but not limited to, a lack of trading market for our securities, reduced liquidity, decreased analyst coverage of our securities, and an inability for us to obtain additional financing to fund our operations.

Item 2.        Unregistered Sales of Equity Securities and Use of Proceeds

We did not issue any equity securities during our fiscal quarter ended October 31, 2013 that were not registered under the Securities Act of 1933, as amended (the “U.S. Securities Act”), except as follows:

• On August 2, 2013, we issued an aggregate of 55,000 shares of restricted common stock to three consultants at a deemed issuance price of $2.41 per share in consideration for services under consulting agreements. We relied on exemptions from registration under the U.S. Securities Act provided by Regulation S and/or Section 4(a)(2) for one of the three consultants and by Rule 506 of Regulation D and/or Section 4(a)(2) of the U.S. Securities Act with respect to the other two consultants; and
• On October 7, 2013, we issued an aggregate of 75,239 shares of restricted common stock to five consultants at a deemed issuance price of $2.10 per share (with respect to 65,000 of such shares) and 2.09 per share (with respect to the remaining 10,239 shares) in consideration for services under consulting agreements. We relied on exemptions from registration under the U.S. Securities Act provided by Regulation S and/or Section 4(a)(2) for two of the five consultants and by Rule 506 of Regulation D and/or Section 4(a)(2) of the U.S. Securities Act with respect to the other three consultants.

Item 3.        Defaults Upon Senior Securities

None.

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Item 4.        Mine Safety Disclosures

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States, and that is subject to regulation by the Federal Mine Safety and Health Administration under the Mine Safety and Health Act of 1977 (“Mine Safety Act”), are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the quarter ended October 31, 2013, the Company’s Palangana Mine was not subject to regulation by the Federal Mine Safety and Health Administration under the Mine Safety Act.

Item 5.        Other Information

None.

Item 6.        Exhibits

The following exhibits are included with this Quarterly Report on Form 10-Q:

Exhibit	Description of Exhibit
31.1	Certification of Chief Executive Officer pursuant to the Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
31.2	Certification of Chief Financial Officer pursuant to the Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
32.1	Certifications pursuant to the Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

URANIUM ENERGY CORP.
/s/ Amir Adnani
Amir Adnani
President, Chief Executive Officer (Principal Executive Officer)
and Director
Date: December 6, 2013
/s/ Mark Katsumata
Mark Katsumata
Secretary, Treasurer and Chief Financial Officer (Principal
Financial Officer)
Date: December 6, 2013

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