21
The success of our business may depend, in part, on the establishment of new uses and markets for rare earth
products.
The success of our business may depend, in part, on the establishment of new markets by us or third parties for
certain rare earth products. Although we plan to produce rare earth products for use in end products such as NdFeB
magnets, which are used in critical existing and emerging technologies such as hybrid and electric vehicles, wind
power turbines and compact fluorescent lighting, the success of our business may depend on the creation of new
markets and the successful commercialization of REE products in existing and emerging markets. Any unexpected
costs or delays in the commercialization of any of the foregoing products or applications could have a material
adverse effect on our ability to develop our Bear Lodge REE Project or operate our business profitably.
We rely on our proprietary technology and processes to further our Bear Lodge REE Project.
We rely on a combination of trade secret protection, nondisclosure and licensing agreements and patents to establish
and protect our proprietary intellectual property rights. We utilize trade secret protection, patent-pending filings, and
nondisclosure agreements to protect our proprietary rare earth technology. We have filed five U.S. provisional
patent applications, two of which were combined into a single utility patent application filing with the U.S. Patent
Office. We initiated a Patent Cooperation Treaty Application claiming priority to the U.S. Provisional Applications
on our utility patent filing. These intellectual property rights may be challenged or infringed upon by third parties or
we may be unable to maintain, renew or enter into new license agreements with third-party owners of intellectual
property on reasonable terms. In addition, our intellectual property could be subject to infringement or other
unauthorized use outside of the United States. In such case, our ability to protect our intellectual property rights by
legal recourse or otherwise may be limited, particularly in countries where laws or enforcement practices are
undeveloped or do not recognize or protect intellectual property rights to the same extent as the United States.
Unauthorized use of our intellectual property rights or inability to preserve existing intellectual property rights could
adversely impact our competitive position or results of operations. The loss of our patents could reduce the value of
the related products.
The success of our business depends, in part, on our ability to utilize our proprietary process technologies, and we
could encounter unforeseen problems or costs, or both, in scaling up our technologies to commercial applications.
Our Mineral Resource estimates may be inaccurate and any material change in these estimates could affect the
economic viability of placing our Bear Lodge REE Project into production.
Unless otherwise indicated, our Mineral Resources are based upon estimates made by independent geologists.
When making determinations about whether to advance the Bear Lodge REE Project to development, we must rely
upon such estimated calculations as to the quantity and grades of mineralization on the property as well as estimates
about mining and processing costs and future prices. Until mineralized material is actually mined and processed,
Mineral Resources and grades of such mineralization must be considered estimates only, which may prove to be
unreliable.
Because we have not completed a FS on the Bear Lodge REE Project and have not commenced actual production,
mineralization estimates, including Mineral Resource estimates, for the Bear Lodge REE Project may require
adjustments, including potential downward revisions. In addition, the grade of material ultimately mined, if any,
may differ from that indicated in our Mineral Resource estimates or in future feasibility studies.
Our Mineral Resource estimates have been determined based on assumed cut-off grades that depend upon estimated
REE prices, recovery rates and project operating costs. Any significant change in cut-off grades could reduce our
estimates of mineralization, or the amount of mineralization to be extracted, and could have a material adverse effect
on our share price and the value of our Bear Lodge REE Project.
We are subject to significant governmental regulations, including permitting, licensing and approval processes
that affect our operations and could impact the cost and timing of conducting our business.
Our current and future activities will be governed by laws and regulations, including:
laws and regulations governing mineral concession acquisition, prospecting, development, mining
and production;
