Annual report [Section 13 and 15(d), not S-K Item 405]

Warrant Liability

v3.25.1
Warrant Liability
12 Months Ended
Dec. 31, 2024
Warrant Liability  
Warrant Liability

14.Warrant Liability

In February 2021, the Company issued 16,930,530 warrants to purchase 8,465,265 common shares at $1.35 per common share for a term of three years.

In February 2023, the Company issued 39,100,000 warrants to purchase 19,550,000 common shares at $1.50 per common share for a term of three years. As of December 31, 2024, 39,041,000 warrants to purchase 19,520,500 common shares were outstanding.

Because the warrants are priced in U.S. dollars and the functional currency of Ur-Energy Inc., the parent company entity, is Canadian dollars, a derivative financial liability was created. Using Level 2 inputs of the fair value hierarchy under US GAAP, the liability created is measured and recorded at fair value, and adjusted monthly, using the Black-Scholes model described below as there is no active market for the warrants. Any gain or loss from the mark-to-market adjustment of the liability is reflected in net income for the period.

Activity with respect to the warrant liabilities is presented in the following table:

    

Feb.

    

Feb.

    

2021

2023

Warrant Liability Activity

Warrants

Warrants

Total

December 31, 2022

 

2,382

 

 

2,382

Warrants issued

 

 

9,109

 

9,109

Warrants exercised

 

(55)

 

(3)

 

(58)

Mark to market revaluation gain

 

(626)

 

2,212

 

1,586

Effects for foreign exchange rate changes

 

42

 

231

 

273

December 31, 2023

 

1,743

 

11,549

 

13,292

Warrants exercised

 

(4,771)

 

(20)

 

(4,791)

Mark to market revaluation loss (gain)

 

3,072

 

(8,392)

 

(5,320)

Effects for foreign exchange rate changes

 

(44)

 

(608)

 

(652)

December 31, 2024

 

 

2,529

 

2,529

The duration of the outstanding warrants as of December 31, 2024 are presented in the following table:

    

February 2023

    

Warrant Liability Duration

Warrants

Total

Current portion of warrant liability

 

 

Long-term warrant liability

 

2,529

 

2,529

 

2,529

 

2,529

The fair value of the warrant liabilities on December 31, 2024 and 2023, was determined using the Black-Scholes model with the following assumptions:

2024

2023

    

February

February

February

2023

2021

2023

Black-Scholes Assumptions

Warrants

Warrants

Warrants

Expected forfeiture rate

 

%

%  

%

Expected life (years)

 

1.1

0.1

 

2.1

Expected volatility

 

46.1

%

45.8

%  

61.6

%

Risk free rate

 

2.9

%

3.8

%  

3.8

%

Expected dividend rate

 

%

%  

%

Exercise price

$

1.50

$

1.35

$

$1.50

Market price

$

1.15

$

1.54

$

$1.54