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FAIR VALUE ACCOUNTING | 12 Months Ended
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Dec. 31, 2023
Fair Value Disclosures [Abstract] |
Fair Value Accounting | INVESTMENTS As of December 31, 2022, the Company owned a 17.4% interest in Consolidated Uranium Inc. (“CUR”) and a 13.5% interest in Virginia Energy Resources, Inc. (“Virginia Energy”). The Company had significant influence, but not control, over these investments. As such, Virginia Energy and CUR were accounted for as equity method investments with the fair value option elected and classified as Investments on the Consolidated Balance Sheet. Changes in value of these investments are included in Other income (loss) in the Consolidated Statement of Operations and Comprehensive Income (Loss). For the years ended December 31, 2023, 2022 and 2021, the Company had a net unrealized gain of $4.98 million, an unrealized loss of $16.81 million and a unrealized gain of $6.31 million, respectively. On January 24, 2023, CUR acquired 100% of the issued and outstanding common shares of Virginia Energy in for 0.26 common shares of CUR for every one common share of Virginia Energy. As a result, the Company’s 9,439,857 common shares of Virginia Energy were converted into 2,454,362 million common shares of CUR (the “Conversion”). Following the Conversion, the Company owned 16,189,548 common shares of CUR, which represented an ownership interest of 16.7% in CUR as of closing. On December 5, 2023, IsoEnergy Ltd. (“IsoEnergy”) acquired all of the issued and outstanding common shares of CUR (the “CUR Shares”). Pursuant to the arrangement, CUR’s shareholders received 0.500 common shares of IsoEnergy for every CUR Share. When converted, the Company's CUR Shares results in an approximate ownership interest in IsoEnergy of 5.0%. On October 19, 2023, IsoEnergy completed its marketed private placement offering of 8,134,500 subscription receipts of IsoEnergy (the “Subscription Receipts”) at a price of Cdn$4.50 per Subscription Receipt; in order to retain its post-arrangement ownership interest in IsoEnergy, the Company purchased 406,650 Subscription Receipts for Cdn$1.83 million. Each outstanding Subscription Receipt has been converted into one common share of IsoEnergy. Following completion of this arrangement, the Company owned 8,501,424 shares of IsoEnergy for an approximate ownership interest of 5.0% as of December 5, 2023. Upon completion of this arrangement, the Company does not have significant influence over IsoEnergy as a result of no representation on the Board of Directors of IsoEnergy and its reduced ownership interest. Therefore, the investment is no longer accounted for as an equity method investment. The Company's judgment regarding the level of influence over its equity method investments includes considering key factors such as the Company's ownership interest, representation on the Board of Directors and participation in the policy-making decisions of equity method investees. As such, the Company's shares in IsoEnergy are accounted for as marketable securities with the fair value option elected on its Consolidated Balance Sheet and changes in value are included in Other income (loss) in the Consolidated Statement of Operations and Comprehensive Income (Loss). CUR As of December 5, 2023 and December 31, 2022, the fair value of the Company’s investment in CUR was $23.63 million and $16.50 million, respectively. Pursuant to Rule 3-09 of Regulation S-X (“Rule 3-09”), the Company is required to file separate audited financial statements of CUR if either the investment test or income test as set forth in that rule equals or exceeds the 20% level individually. As of December 31, 2022, the income test was met at the 20% significance level for CUR. The Company will amend this Annual Report to include as an exhibit the separate audited financial statements for the year ended December 31, 2022 and unaudited financial statements for the period ending December 5, 2023. In accordance with Rule 4-08(g) of Regulation S-X (“Rule 4-08(g)”), the summarized financial information for CUR is set forth below on a one-quarter lag, which precedes the date of the Company’s investment for the year ended December 31, 2021. CUR prepares its financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”) and uses Cdn$ as its reporting currency. As such, the Company has made certain adjustments to CUR’s summarized financial information to address differences between IFRS and GAAP that materially impact the summarized financial information and to convert such information to US$.
| September 30,
| 2023 |  | 2022
Current assets | $ | 7,522 |  |  | $ | 16,586 |
Non-current assets | $ | 31,717 |  |  | $ | 17,437 |
Current liabilities | $ | 3,589 |  |  | $ | 2,285 |
Non-current liabilities | $ | 319 |  |  | $ | — |
| Twelve Months Ended September 30,
| 2023 |  | 2022 |  | 2021
Loss from continuing operations | $ | (8,817) |  |  | $ | (23,103) |  |  | $ | (4,253) |
Net loss and net loss attributable to the entity | $ | (8,902) |  |  | $ | (17,890) |  |  | $ | (4,570) |
Virginia Energy The fair value of the Company's investment in Virginia Energy was $3.39 million and $2.83 million as of January 24, 2023 and December 31, 2022, respectively. Pursuant to Rule 3-09, the Company is required to file separate audited financial statements of Virginia Energy if either the investment test or income test as set forth in that rule equals or exceeds the 20% level individually. As of December 31, 2021, the income test was met at the 20% significance level for Virginia Energy. Exhibit 99.1 to this Annual Report includes separate audited financial statements for the year ended December 31, 2021 and unaudited financial statements for the twenty-three day period ended January 23, 2023 and the year ended December 31, 2022 of Virginia Energy. In accordance with Rule 4-08(g), summarized financial information for Virginia Energy is set forth below on a one-quarter lag. Virginia Energy prepares its financial statements in accordance with IFRS. The Company determined that no adjustments to Virginia Energy’s summarized financial information were necessary to address differences between IFRS and GAAP that materially impact the summarized financial information.
| January 23, 2023 |  | September 30, 2022
Current assets | $ | 133 |  |  | $ | 163 |
Non-current assets | $ | 4,253 |  |  | $ | 3,753 |
Current liabilities | $ | 2 |  |  | $ | 223 |
Non-current liabilities | $ | 2 |  |  | $ | 2 |
| For the Period October 1, 2022 to January 23, 2023 |  | Twelve Months Ended September 30,
|  | 2022 |  | 2021
Loss from continuing operations, net loss and net loss attributable to the entity | $ | (226) |  |  | $ | (371) |  |  | $ | (275) |
FAIR VALUE ACCOUNTING Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Fair value accounting utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 – Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company’s financial instruments include cash, restricted cash, accounts receivable, accounts payable and current accrued liabilities. These instruments are carried at cost, which approximates fair value due to the short-term maturities of the instruments. Allowances for doubtful accounts are recorded against the accounts receivable balance to estimate net realizable value. As of December 31, 2023 and 2022, the fair values of cash, restricted cash, short-term deposits, receivables, accounts payable and accrued liabilities approximate their carrying values because of the short-term nature of these instruments. The Company’s investments in marketable equity securities are publicly traded stocks measured at fair value and classified within Level 1 and Level 2 in the fair value hierarchy. Level 1 marketable equity securities use quoted prices for identical assets in active markets, while Level 2 marketable equity securities utilize inputs based upon quoted prices for similar instruments in active markets. The Company’s investments in marketable debt securities are valued using quoted prices of a pricing service and as such, are classified within Level 2 of the fair value hierarchy. The Company’s investments include certain investments accounted for at fair value consisting of Common Shares are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The Company’s investments include certain investments accounted for at fair value consisting of warrants are valued using the Black-Scholes option model based on observable inputs and as such are classified within Level 2 of the hierarchy. The Convertible Note received as part of the Alta Mesa Transaction was valued as of February 14, 2023, upon closing, using a binomial lattice model. The fair value calculation uses significant unobservable inputs, including: (i) volatility 60%, and (ii) yield of 9.5%. Increases or decreases in the volatility and/or the selected yield can result in an increase or decrease in the fair value of the Convertible Note. Between February 14, 2023 and November 3, 2023, enCore early redeemed $40.00 million of the principal value of the Convertible Note. On November 9, 2023, the Company sold the remaining unpaid balance of $20 million owed under the secured Convertible Note for total consideration of $21.00 million plus $1.50 million in unpaid accrued interest, less a sales commission of $100,000 paid to a third-party broker. As a result of enCore’s earlier pay-down and the $22.40 million received in connection with the sale of the Convertible Note, the Company has now received payment in full for the Alta Mesa Transaction, and no further consideration is owed in connection therewith. The following tables set forth the fair value of the Company’s assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
| Level 1 |  | Level 2 |  | Level 3 |  | Total
December 31, 2023 |  |  |  |  |  |  |
Cash equivalents(1) | $ | — |  |  | $ | 40,512 |  |  | $ | — |  |  | $ | 40,512 |
Marketable equity securities | 25,554 |  |  | 24 |  |  | — |  |  | 25,578 |
Marketable debt securities | — |  |  | 107,466 |  |  | — |  |  | 107,466 |
| $ | 25,554 |  |  | $ | 148,002 |  |  | $ | — |  |  | $ | 173,556 |
December 31, 2022 |  |  |  |  |  |  |
Cash equivalents(1) | $ | — |  |  | $ | 30,336 |  |  | $ | — |  |  | $ | 30,336 |
Investments accounted for at fair value | 19,263 |  |  | 66 |  |  | — |  |  | 19,329 |
Marketable equity securities | 1,033 |  |  | 34 |  |  | — |  |  | 1,067 |
Marketable debt securities | — |  |  | 11,125 |  |  | — |  |  | 11,125 |
| $ | 20,296 |  |  | $ | 41,561 |  |  | $ | — |  |  | $ | 61,857 |
(1) Cash and cash equivalents are comprised of U.S. Treasury Bills, Government Agency Bonds, U.S. Non-Redeemable Term Deposits and mutual funds purchased within three months of their maturity date. Changes in Level 3 Fair Value Measurements The following table is a reconciliation of the beginning and ending balance recorded for the Convertible Note classified as Level 3 in the fair value hierarchy:
Beginning balance, February 14, 2023 | $ | 59,457 |
Principal redeemed and sale | (60,887) |
Realized gain included in other income (loss) | 1,430 |
Ending balance, December 31, 2023 | $ | — |

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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