UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2019 Table of Contents 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 001‑33404 WESTWATER RESOURCES, INC. (Exact Name of Registrant as Specified in Its Charter) DELAWARE 75‑2212772 (State of ...

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Westwater Resources reported a net loss of $5.9 million for H1 2019, a significant improvement from H1 2018, with ongoing going concern doubts and reliance on future financing [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet highlights changes in assets, liabilities, and equity, including a shift to a working capital deficit Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2019 | December 31, 2018 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash and cash equivalents | $1,156 | $1,577 | ($421) | | Assets held for sale | $1,767 | $1,545 | $222 | | Total Current Assets | $3,402 | $4,180 | ($778) | | Net property, plant and equipment | $20,505 | $20,553 | ($48) | | Total Assets | $28,216 | $29,958 | ($1,742) | | **Liabilities & Equity** | | | | | Total Current Liabilities | $6,075 | $3,172 | $2,903 | | Total Liabilities | $12,116 | $9,167 | $2,949 | | Total Stockholders' Equity | $16,100 | $20,791 | ($4,691) | - The company's working capital shifted from a surplus of **$1.0 million** at year-end 2018 to a deficit of **$2.7 million** at June 30, 2019, primarily driven by an increase in accounts payable and accrued liabilities[9](index=9&type=chunk)[34](index=34&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statement of operations details the net loss and operating expenses, significantly impacted by prior-year impairment charges Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2019 | Q2 2018 | Six Months 2019 | Six Months 2018 | | :--- | :--- | :--- | :--- | :--- | | Total operating expenses | $(2,933) | $(20,736) | $(5,552) | $(24,246) | | Impairment of uranium properties | $0 | $(17,968) | $0 | $(17,968) | | Net Loss | $(2,775) | $(20,457) | $(5,949) | $(23,876) | | Basic and Diluted Loss Per Share | $(1.81) | $(25.63) | $(3.95) | $(35.14) | - The significant decrease in net loss for both the three and six-month periods of 2019 compared to 2018 is primarily attributable to a **$18.0 million impairment charge** on Turkish uranium properties recorded in June 2018[11](index=11&type=chunk)[54](index=54&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statement summarizes cash movements from operating, investing, and financing activities, resulting in a net decrease in cash Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Activity | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | $(4,324) | $(6,090) | | Net Cash Provided By Investing Activities | $2,786 | $26 | | Net Cash Provided By Financing Activities | $1,153 | $4,725 | | **Net decrease in cash** | **$(385)** | **$(1,339)** | - Investing activities in H1 2019 were primarily driven by a **$1.5 million deposit** received for the sale of assets to URC and **$0.8 million** in payments on the Laramide note receivable[13](index=13&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) - Financing activities consisted of **$1.2 million** raised from common stock issuances[13](index=13&type=chunk)[127](index=127&type=chunk) [Notes to Financial Statements](index=9&type=section&id=Notes%20to%20Financial%20Statements) Key notes detail a reverse stock split, new lease accounting, going concern doubts, an asset sale agreement, and segment reporting - The company effected a **1-for-50 reverse stock split** on April 22, 2019, reducing shares outstanding from approximately **74.7 million to 1.5 million**[22](index=22&type=chunk)[59](index=59&type=chunk) - Management concluded there is **substantial doubt** about the company's ability to continue as a going concern, citing a history of losses since 2009, a working capital deficit of **$2.7 million**, and reliance on future financing[31](index=31&type=chunk)[32](index=32&type=chunk)[36](index=36&type=chunk) - The company entered an agreement to sell uranium royalty interests and the remaining **$2.0 million** Laramide promissory note to Uranium Royalty Corp. for **$2.75 million**, receiving a **$1.5 million deposit** as of June 30, 2019[47](index=47&type=chunk)[49](index=49&type=chunk) - The company operates in three reportable segments: uranium, lithium, and graphite, with long-term assets allocated as follows: **Uranium ($15.2M)**, **Graphite ($9.0M)**, **Lithium ($0)**, and **Corporate ($0.7M)** as of June 30, 2019[86](index=86&type=chunk)[89](index=89&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the strategic focus on battery materials, reduced net loss, liquidity efforts, and ongoing arbitration against Turkey, reiterating going concern doubts - The company's portfolio products—graphite, lithium, and uranium—have all been included on the U.S. government's list of critical minerals, which may support domestic development[96](index=96&type=chunk) - In response to a Section 232 investigation, the U.S. President opted not to impose trade actions on uranium imports but established a Nuclear Fuel Working Group to recommend ways to revive domestic production, acknowledging it as a national security issue[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - The company is pursuing international arbitration against the Republic of Turkey for the unlawful cancellation of its Temrezli and Şefaatli uranium project licenses in June 2018[110](index=110&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk) - To address liquidity, the company entered into agreements with Lincoln Park Capital for up to **$10.0 million** in equity financing and sold shares through its Cantor ATM facility[102](index=102&type=chunk)[127](index=127&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) As a smaller reporting company, Westwater Resources is not required to provide market risk disclosures in its Quarterly Reports - The company is not required to provide quantitative and qualitative disclosures about market risk because it qualifies as a smaller reporting company[137](index=137&type=chunk) [Controls and Procedures](index=29&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of the end of the period, June 30, 2019[139](index=139&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, these controls[140](index=140&type=chunk) [PART II - OTHER INFORMATION](index=30&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Legal Proceedings](index=30&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is pursuing international arbitration against Turkey through ICSID for the unlawful cancellation of its uranium project licenses - On December 13, 2018, Westwater filed a Request for Arbitration against the Republic of Turkey with ICSID due to the cancellation of its uranium project licenses[142](index=142&type=chunk) - The company alleges that Turkey's actions, which rendered its investment worthless, were unlawful and violated Westwater's rights under Turkish and international law[142](index=142&type=chunk) - A three-member ICSID panel for the arbitration was established on May 1, 2019, and the parties are working to finalize a procedural order to govern the arbitration[143](index=143&type=chunk) [Risk Factors](index=30&type=section&id=ITEM%201A.%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's prior quarterly report - The company states there have been no material changes to the risk factors disclosed in its prior quarterly report for the period ending March 31, 2019[144](index=144&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) The company reported no unregistered sales of equity securities during the period - None reported[145](index=145&type=chunk) [Defaults Upon Senior Securities](index=30&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) The company reported no defaults upon senior securities - None reported[146](index=146&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company for this reporting period - Not applicable[147](index=147&type=chunk) [Other Information](index=30&type=section&id=ITEM%205.%20OTHER%20INFORMATION) The company reported no other information for this item - None reported[148](index=148&type=chunk) [Exhibits](index=31&type=section&id=ITEM%206.%20EXHIBITS) Key exhibits filed include agreements with Lincoln Park Capital Fund, LLC and an amendment to the Asset Purchase Agreement with Uranium Royalty Corp - Key exhibits filed include the Securities Purchase Agreement and Purchase Agreement with Lincoln Park Capital Fund, LLC, and an amendment to the Asset Purchase Agreement with Uranium Royalty Corp[149](index=149&type=chunk)

PART I — FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Westwater Resources reported a **$3.2 million net loss** for Q1 2019, with decreased assets and a **working capital deficit**, raising going concern doubts Condensed Consolidated Balance Sheet (in thousands) | | March 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | **Total Current Assets** | $3,358 | $4,180 | | **Total Assets** | $28,206 | $29,958 | | **Total Current Liabilities** | $4,052 | $3,172 | | **Total Liabilities** | $10,076 | $9,167 | | **Total Stockholders' Equity** | $18,130 | $20,791 | Condensed Consolidated Statement of Operations (in thousands) | | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | **Total operating expenses** | $(2,619) | $(3,510) | | **Net Loss** | $(3,174) | $(3,419) | | **Comprehensive Loss** | $(3,084) | $(4,356) | | **Basic and Diluted Loss Per Share** | $(2.15) | $(6.11) | Condensed Consolidated Statement of Cash Flows (in thousands) | | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | **Net Cash Used in Operating Activities** | $(2,740) | $(3,696) | | **Net Cash Provided by Investing Activities** | $1,786 | $628 | | **Net Cash Provided by Financing Activities** | $414 | $651 | | **Net decrease in cash, cash equivalents and restricted cash** | $(540) | $(2,417) | [Note 1: Basis of Presentation](index=8&type=section&id=1.%20BASIS%20OF%20PRESENTATION) Unaudited financial statements are prepared under U.S. GAAP, reflecting a new lease accounting standard adoption and a retroactive **1-for-50 reverse stock split** - On April 22, 2019, the company executed a **1-for-50 reverse stock split**, reducing outstanding shares from approximately **74.7 million to 1.5 million**, with all share data retroactively adjusted[21](index=21&type=chunk) - The company adopted the new lease accounting standard (ASU No. 2016-02) on January 1, 2019, recording a **$0.6 million right-of-use lease asset** and corresponding liability[22](index=22&type=chunk) [Note 2: Liquidity and Going Concern](index=9&type=section&id=2.%20LIQUIDITY%20AND%20GOING%20CONCERN) Substantial doubt exists about the company's ability to continue as a going concern due to a **$1.0 million working capital deficit** and reliance on external financing - Events and conditions raise **substantial doubt** about the Company's ability to continue as a **going concern**, as it may be unable to meet its obligations within one year[30](index=30&type=chunk) Liquidity Position as of March 31, 2019 | Metric | Amount (in millions) | | :--- | :--- | | Cash Balance | $1.0 | | Working Capital Deficit | $1.0 | - The company plans to fund future operations through a **$2.25 million** payment from an asset sale due by June 30, 2019, and an anticipated public equity offering of up to **$10.0 million**[33](index=33&type=chunk) [Note 3: Acquisitions](index=10&type=section&id=3.%20ACQUISITIONS) The company acquired **100% of Alabama Graphite Corp.** for **$8.9 million** in April 2018, primarily allocating value to mineral interests Alabama Graphite Acquisition Consideration (in thousands) | Consideration Type | Value | | :--- | :--- | | Cash | $2,397 | | Issuance of Common Shares | $6,394 | | Issuance of Options & Warrants | $89 | | **Total Consideration** | **$8,880** | [Note 5: Assets Held for Sale](index=12&type=section&id=5.%20ASSETS%20HELD%20FOR%20SALE) The company agreed to sell uranium royalty interests and a promissory note for a total of **$2.75 million**, with **$2.25 million** due by June 30, 2019 - The company entered an agreement to sell four royalty interests and the Laramide promissory note for a total of **$2.75 million**[46](index=46&type=chunk) - Consideration includes a **$0.5 million** cash deposit received on March 5, 2019, and a final payment of **$2.25 million** due on or before June 30, 2019[47](index=47&type=chunk) [Note 8: Mineral Property Expenditures](index=14&type=section&id=8.%20MINERAL%20PROPERTY%20EXPENDITURES) Mineral property expenditures for Q1 2019 decreased to **$0.63 million**, primarily for Texas projects' standby and maintenance Mineral Property Expenditures by Location (Q1, in thousands) | Location | 2019 | 2018 | | :--- | :--- | :--- | | Texas projects | $547 | $689 | | Alabama Projects | $80 | $— | | Turkey projects | $— | $79 | | Other projects | $7 | $14 | | **Total** | **$634** | **$782** | [Note 10: Common Stock](index=15&type=section&id=10.%20COMMON%20STOCK) The company executed a **1-for-50 reverse stock split** and sold **57,205 shares** for **$0.4 million** net proceeds in Q1 2019 - In Q1 2019, the company sold **57,205 shares** for net proceeds of **$0.4 million** under its ATM Offering with Cantor Fitzgerald[57](index=57&type=chunk) [Note 15: Geographic and Segment Information](index=19&type=section&id=15.%20GEOGRAPHIC%20AND%20SEGMENT%20INFORMATION) The company operates in uranium, lithium, and graphite segments, with **100% of long-term assets in the U.S.** and the corporate segment reporting the largest loss - The company operates in **three reportable segments**: uranium, lithium, and graphite mining activities[79](index=79&type=chunk) Long-Term Assets by Segment (March 31, 2019, in thousands) | Segment | Long-Term Assets | | :--- | :--- | | Uranium | $15,173 | | Graphite | $8,982 | | Corporate | $693 | | Lithium | $— | | **Total** | **$24,848** | Loss from Operations by Segment (Q1 2019, in thousands) | Segment | Loss from Operations | | :--- | :--- | | Corporate | $1,280 | | Uranium | $1,093 | | Graphite | $245 | | Lithium | $1 | | **Total** | **$2,619** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the company's focus on battery materials, recent asset sales, a reverse stock split, and a **$3.2 million net loss** for Q1 2019, with ongoing going concern doubts [Recent Developments](index=21&type=section&id=Recent%20Developments) Key recent developments include arbitration against Turkey, a **$2.75 million asset sale**, a **1-for-50 reverse stock split**, and promising vanadium discoveries - In December 2018, Westwater filed a **Request for Arbitration** against the **Republic of Turkey** for the illegal taking of its Temrezli and Şefaatli uranium projects[89](index=89&type=chunk) - On March 5, 2019, the company agreed to sell four uranium royalties and a promissory note for **$2.75 million**, with **$2.25 million** due by June 30, 2019[93](index=93&type=chunk) - A **1-for-50 reverse stock split** was effected on April 22, 2019, to regain compliance with Nasdaq's $1.00 minimum bid price requirement[99](index=99&type=chunk) - The company announced the discovery of **significant vanadium concentrations** at its Coosa Project and has commenced an exploration program[96](index=96&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) The consolidated net loss for Q1 2019 was **$3.2 million**, an improvement driven by decreased mineral property expenses but impacted by a **$0.7 million loss** on marketable securities Net Loss Comparison (Q1) | Period | Net Loss (in millions) | Loss Per Share | | :--- | :--- | :--- | | **2019** | $3.2 | $2.15 | | **2018** | $3.4 | $6.11 | - Mineral property expenses decreased by **$0.2 million**, primarily due to the revocation of mining licenses in Turkey and reduced reclamation activities at the Vasquez and Rosita Projects[103](index=103&type=chunk)[104](index=104&type=chunk) - A loss of **$0.7 million** was recognized from the sale of Laramide common shares and warrants[106](index=106&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) The company's going concern ability is in substantial doubt, with **$1.0 million cash** and a **$1.0 million working capital deficit**, relying on future asset sales and equity offerings - The financial statements are prepared on a '**going concern**' basis, but **substantial doubt** exists about the company's ability to continue due to recurring losses and negative cash flow[110](index=110&type=chunk) Financial Position (March 31, 2019) | Metric | Amount (in millions) | | :--- | :--- | | Cash Balance | $1.0 | | Working Capital Deficit | $1.0 | - Expected funding sources include a **$2.25 million** payment from an asset sale by June 30, 2019, and a planned public equity offering for up to **$10.0 million**[113](index=113&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) As a smaller reporting company, Westwater Resources is not required to provide quantitative and qualitative disclosures about market risk in its Quarterly Reports - The company is **not required** to provide quantitative and qualitative disclosures about market risk as it qualifies as a **smaller reporting company**[119](index=119&type=chunk) [Item 4. Controls and Procedures](index=27&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded disclosure controls were effective as of March 31, 2019, with significant modifications to internal controls due to a new lease accounting standard - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of March 31, 2019[121](index=121&type=chunk) - **Significant modifications** were made to internal controls to accommodate the adoption of the new lease accounting standard, ASU 2016-02[122](index=122&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=27&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) No material changes have occurred in legal proceedings since the 2018 Annual Report on Form 10-K - **No material changes** have occurred in legal proceedings since the 2018 Annual Report on Form 10-K[123](index=123&type=chunk) [Item 1A. Risk Factors](index=27&type=page&id=ITEM%201A.%20RISK%20FACTORS.) The company faces substantial risks, primarily concerning its ability to continue as a going concern due to historical losses, a working capital deficit, and the need for additional capital - There is **substantial doubt** about the company's ability to continue as a **going concern** due to significant historical losses and a working capital deficit of approximately **$1.0 million** as of March 31, 2019[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) - The company may fail if it is **unable to raise additional capital**, which would likely result in **substantial dilution** to existing shareholders if successful[128](index=128&type=chunk)[129](index=129&type=chunk) - The company faces significant risks related to its **new battery-graphite manufacturing business**, including competition, lack of experience, and potential delays and cost overruns in plant construction[138](index=138&type=chunk)[141](index=141&type=chunk) - The company is **not in compliance** with **Nasdaq's minimum bid price requirement** and faces **potential delisting**, which would adversely affect the stock's liquidity and value[178](index=178&type=chunk)[179](index=179&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS.) The company reported no unregistered sales of equity securities during the period - The company reported **no unregistered sales** of equity securities during the period[183](index=183&type=chunk) [Item 6. Exhibits](index=38&type=section&id=ITEM%206.%20EXHIBITS.) This section lists the exhibits filed with the Form 10-Q, including an Asset Purchase Agreement, Sarbanes-Oxley certifications, and XBRL data files - **Exhibits filed** include the Asset Purchase Agreement with Uranium Royalty Corp., Sarbanes-Oxley certifications, and XBRL instance documents[188](index=188&type=chunk)

Part I [Item 1. Business](index=6&type=section&id=ITEM%201.%20DESCRIPTION%20OF%20BUSINESS.) Westwater Resources transitioned to a diversified energy materials developer, focusing on battery-grade graphite, lithium, and uranium, marked by a key acquisition and arbitration against Turkey - The company has shifted its focus to become a diversified energy materials developer, with assets in uranium, lithium exploration, and battery-graphite materials following the acquisition of **Alabama Graphite Corp. in April 2018**[24](index=24&type=chunk) - WWR's primary strategy is to expand into the battery materials market while holding its uranium assets as an option for when prices recover, with plans for a **pilot-scale graphite processing plant in 2019** and a **commercial facility in 2020**[27](index=27&type=chunk)[28](index=28&type=chunk) - In **December 2018**, Westwater filed a Request for Arbitration against the **Republic of Turkey** for the illegal taking of its Temrezli and Şefaatli uranium projects in June 2018[34](index=34&type=chunk)[37](index=37&type=chunk) - The company discovered **significant vanadium concentrations** at its Coosa Graphite Project in late 2018, with assay results showing values up to **0.4% V2O5**[41](index=41&type=chunk)[42](index=42&type=chunk) [Overview of Westwater Resources' Projects](index=11&type=section&id=OVERVIEW%20OF%20WESTWATER%20RESOURCES%27%20PROJECTS) The company's diversified project portfolio includes near-term graphite development, mid-term lithium exploration, and long-term uranium assets - **Coosa Graphite Project (Alabama):** Acquired in **2018**, this is the company's primary focus, with plans to build a **pilot plant in 2019** and a **commercial processing facility in 2020**, and the Coosa mine planned for a **2026 start-up**[72](index=72&type=chunk)[73](index=73&type=chunk) - **Lithium Projects (Nevada & Utah):** The company holds **three exploration-stage lithium brine projects**: Columbus Basin (**14,200 acres** in NV), Railroad Valley (**9,270 acres** in NV), and Sal Rica (**13,260 acres** in UT)[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk) - **Uranium Projects (Texas & New Mexico):** WWR has **two licensed processing facilities** (Kingsville Dome and Rosita) in Texas on standby, and controls approximately **188,700 acres** of mineral rights in New Mexico's Grants Mineral Belt[92](index=92&type=chunk)[93](index=93&type=chunk) [Environmental Considerations and Permitting](index=14&type=section&id=ENVIRONMENTAL%20CONSIDERATIONS%20AND%20PERMITTING) Company operations are subject to extensive environmental regulations, requiring various permits and licenses for uranium, graphite, and lithium, along with financial surety for reclamation - Uranium extraction requires a **radioactive material license**, with jurisdiction handled by the Texas Commission of Environmental Quality (TCEQ) in Texas and the Nuclear Regulatory Commission (NRC) in New Mexico[99](index=99&type=chunk) - Graphite mining in Alabama is regulated by the Alabama Department of Labor under the Alabama Surface Mining Act of 1969, requiring a **permit and reclamation bond**[108](index=108&type=chunk) - The company is required by Texas regulators to obtain financial surety for future restoration and reclamation obligations, with performance bonds totaling **$9.1 million**[114](index=114&type=chunk) - As of December 31, 2018, the estimated restoration and reclamation liabilities for prior operations at the Kingsville Dome, Vasquez, and Rosita sites are about **$7.9 million**, with a carrying value of **$6.2 million** on the balance sheet[117](index=117&type=chunk) [Item 1A. Risk Factors](index=18&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces significant risks including substantial doubt about its going concern ability, reliance on financing, commodity price volatility, and potential Nasdaq delisting - There is **substantial doubt** about the company's ability to continue as a going concern, having incurred significant losses since 2009 and ending 2018 with approximately **$1.0 million** in net working capital and **$1.6 million** in cash[127](index=127&type=chunk)[128](index=128&type=chunk) - The company currently has **no sources of operating cash flow** as it is not producing any minerals, with its viability dependent on monetizing assets, partnering, or raising capital[129](index=129&type=chunk) - The company faces risks related to its new battery-graphite manufacturing business, including competition, the need for additional capital, and a **lack of prior experience** in graphite production[136](index=136&type=chunk)[138](index=138&type=chunk) - The company is at risk of being delisted from The Nasdaq Capital Market for failing to maintain the **$1.00 per share** minimum bid price requirement[181](index=181&type=chunk) [Item 2. Properties](index=27&type=section&id=ITEM%202.%20PROPERTIES) Westwater Resources holds a diverse portfolio of mineral properties across the US, including graphite, lithium, and legacy uranium assets Property Portfolio Overview | Project Type | Project Name(s) | Location | Acreage (approx.) | | :--- | :--- | :--- | :--- | | **Graphite** | Coosa Project | Alabama | 41,965 | | **Lithium** | Columbus Basin | Nevada | 14,200 | | | Railroad Valley | Nevada | 9,270 | | | Sal Rica | Utah | 13,260 | | **Uranium** | Kingsville, Rosita, Vasquez, Butler Ranch | Texas | ~11,000 | | | Cebolleta, Juan Tafoya, Other | New Mexico | ~188,700 | [Graphite Project](index=27&type=section&id=GRAPHITE%20PROJECT) The Coosa Graphite Project in Alabama, covering 41,965 acres, focuses on building a pilot production facility for advanced battery materials - The Coosa Project comprises a lease of approximately **41,965 acres** of privately-owned mineral rights in Coosa County, Alabama[189](index=189&type=chunk) - The company has begun engineering work for a **pilot plant facility** to upgrade and purify graphite material into products like purified micronized graphite and delaminated expanded graphite for customer qualification[196](index=196&type=chunk) [Lithium Properties](index=30&type=section&id=LITHIUM%20PROPERTIES) The company controls three exploration-stage lithium brine projects in Nevada and Utah, with initial drilling and sampling indicating anomalous lithium - At the Columbus Basin Project, a 2017 Phase I drilling program completed three core holes, identifying fluids with high total dissolved solids and lithium concentrations up to **43 ppm**[206](index=206&type=chunk)[208](index=208&type=chunk) - The Sal Rica Project has historical drilling data from the 1960s and recent sampling confirming anomalous lithium values ranging from **22 to 81 ppm** in shallow brines[220](index=220&type=chunk) [Uranium Properties](index=37&type=section&id=URANIUM%20PROPERTIES) WWR's uranium assets in Texas are former producing sites in standby or reclamation, while New Mexico properties hold undeveloped resources under long-term leases - **Groundwater restoration is complete** at the Kingsville Dome project, and the site is in a stabilization period, with the UIC permit renewal application withdrawn in 2016 to be resubmitted later[240](index=240&type=chunk)[241](index=241&type=chunk)[242](index=242&type=chunk) - At the Vasquez project, wellfield plugging and abandonment was **completed in July 2018** and **approved by the TCEQ in December 2018**, with the site undergoing complete closure[257](index=257&type=chunk) - The Cebolleta and Juan Tafoya projects in New Mexico are held under leases requiring significant annual advance royalty payments, which were **renegotiated in 2017** to reduce payments for a three-year period[275](index=275&type=chunk)[289](index=289&type=chunk) [Item 3. Legal Proceedings](index=52&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) In 2018, Westwater resolved a dispute with Kleberg County, settled a severance claim, and initiated arbitration against Turkey for expropriated uranium licenses - A long-standing legal dispute with Kleberg County, Texas, regarding groundwater restoration standards was **resolved in the company's favor** by the Texas Supreme Court in **March 2018**[309](index=309&type=chunk)[313](index=313&type=chunk) - A lawsuit with former Alabama Graphite Corp. CFO Douglas Bolton regarding severance was **settled in January 2019** for **CAD$40,000**[315](index=315&type=chunk)[316](index=316&type=chunk) - On **December 13, 2018**, Westwater filed a Request for Arbitration against the **Republic of Turkey** before the International Centre for the Settlement of Investment Disputes (ICSID) due to the cancellation of its uranium exploration and operating licenses[317](index=317&type=chunk) Part II [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=54&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) For 2018, Westwater reported a consolidated net loss of $35.7 million, primarily due to a $23.7 million impairment charge on uranium properties, with management expressing substantial doubt about going concern Consolidated Net Loss Summary (in thousands) | Item | 2018 | 2017 | | :--- | :--- | :--- | | Mineral property expenses | $(3,538) | $(4,584) | | General and administrative | $(7,357) | $(6,614) | | Impairment of uranium properties | $(23,712) | $(11,436) | | **Net Loss** | **$(35,684)** | **$(19,288)** | - The company recorded a total impairment charge of **$23.7 million** in 2018, primarily consisting of an **$18.0 million** write-down of its Turkish uranium assets and a **$5.7 million** impairment of uranium plant and equipment in South Texas[359](index=359&type=chunk)[362](index=362&type=chunk)[363](index=363&type=chunk) - The company's financial statements were prepared on a "going concern" basis, but management notes that recurring losses and reliance on financing raise **substantial doubt** about its ability to continue operations without raising additional capital[373](index=373&type=chunk)[380](index=380&type=chunk) - As of December 31, 2018, the company had **$1.6 million** in cash and a working capital balance of **$1.0 million**, planning to fund future operations through its ATM offering, note receivable payments, and other potential financings[376](index=376&type=chunk)[378](index=378&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=63&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section presents audited financial statements for 2018 and 2017, with the auditor expressing substantial doubt about going concern, showing a $35.7 million net loss and decreased assets - The report from the independent registered public accounting firm, Moss Adams LLP, includes a paragraph highlighting a **going concern uncertainty** due to the company's lack of revenue, recurring losses, and reliance on financing[390](index=390&type=chunk) Key Balance Sheet Data (in thousands) | Account | Dec 31, 2018 | Dec 31, 2017 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,577 | $4,054 | | Total Current Assets | $4,180 | $7,833 | | Net property, plant and equipment | $20,553 | $35,409 | | **Total Assets** | **$29,958** | **$50,238** | | Total Current Liabilities | $3,172 | $3,968 | | **Total Liabilities** | **$9,167** | **$9,121** | | **Total Stockholders' Equity** | **$20,791** | **$41,117** | Key Statement of Operations Data (in thousands) | Account | 2018 | 2017 | | :--- | :--- | :--- | | Total operating expenses | $(36,049) | $(24,818) | | **Net Loss** | **$(35,684)** | **$(19,288)** | | **Basic and Diluted Loss Per Share** | **$(0.77)** | **$(0.78)** | - The company operates in three reportable segments: uranium, lithium, and graphite; for 2018, the uranium segment reported a loss of **$29.6 million** (including impairments), while lithium and graphite segments reported losses of **$0.5 million** and **$0.7 million**, respectively[532](index=532&type=chunk)[537](index=537&type=chunk) [Item 9A. Controls and Procedures](index=88&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2018, with no material changes reported - Based on an evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were **effective as of December 31, 2018**[540](index=540&type=chunk) - Management concluded that the company's internal control over financial reporting was **effective as of December 31, 2018**, based on the framework in Internal Control—Integrated Framework (1992) issued by COSO[543](index=543&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=89&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE.) This section incorporates information by reference from the company's definitive proxy statement for its 2019 Annual Meeting of Stockholders - Information required for this item is incorporated by reference from the company's definitive proxy statement for the 2019 Annual Meeting of Stockholders[549](index=549&type=chunk) [Item 11. Executive Compensation](index=89&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) This section incorporates information by reference from the company's definitive proxy statement for its 2019 Annual Meeting of Stockholders - Information required for this item is incorporated by reference from the company's definitive proxy statement for the 2019 Annual Meeting of Stockholders[550](index=550&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=89&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) This section incorporates information by reference from the company's definitive proxy statement for its 2019 Annual Meeting of Stockholders - Information required for this item is incorporated by reference from the company's definitive proxy statement for the 2019 Annual Meeting of Stockholders[551](index=551&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=89&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) This section incorporates information by reference from the company's definitive proxy statement for its 2019 Annual Meeting of Stockholders - Information required for this item is incorporated by reference from the company's definitive proxy statement for the 2019 Annual Meeting of Stockholders[552](index=552&type=chunk) [Item 14. Principal Accounting Fees and Services](index=89&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTING%20FEES%20AND%20SERVICES) This section incorporates information by reference from the company's definitive proxy statement for its 2019 Annual Meeting of Stockholders - Information required for this item is incorporated by reference from the company's definitive proxy statement for the 2019 Annual Meeting of Stockholders[553](index=553&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=90&type=section&id=ITEM%2015.%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists all exhibits filed with the Form 10-K, including governance documents, material contracts, and required certifications - This item provides a list of all financial statements, schedules, and exhibits filed with the annual report, including **certifications by the CEO and CFO**[556](index=556&type=chunk)[557](index=557&type=chunk)