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Title to our Bear Lodge Property may be subject to other claims, or we may lose our interest in our claims,
which could affect our property rights and claims.
There are risks that title to our Bear Lodge Property may be challenged or impugned. Our Bear Lodge
Property is located in the state of Wyoming and may be subject to prior unrecorded agreements, transfers or native
land claims, and title may be affected by undetected defects. There may be valid challenges to the title of our Bear
Lodge Property which, if successful, could impair or result in the cessation of development and/or operations.
The vast majority of the mineral rights to our Bear Lodge Property consist of “unpatented” mining claims
created and maintained in accordance with the U.S. General Mining Law. Unpatented mining claims are unique
property interests and are generally considered to be subject to greater title risk than other real property interests
because the validity of unpatented mining claims can be uncertain. This uncertainty arises, in part, out of the
complex federal and state laws and regulations an owner of an unpatented mining claim must comply with to locate
and maintain a valid claim. Also, unpatented mining claims are always subject to possible challenges by third
parties or validity contests by the federal government. The validity of an unpatented mining claim, in terms of both
its location and its maintenance, is dependent on strict compliance with not only a complex body of U.S. federal and
state statutory law, but also administrative and judicial decisions interpreting those statutes and case law. In
addition, there may be limitations as to the completeness of public records that determine prior claimants that could
impact the validity or ownership of unpatented mining claims. The Company’s right to continue activities on the
Bear Lodge Property is dependent upon our ability to pay annual claim maintenance fees.
Our operations are subject to significant uninsured risks that could negatively impact future profitability as
we maintain limited insurance against our operations.
The exploration of our Bear Lodge Property entails certain risks including unexpected or unusual operating
conditions, such as rock slides, cave-ins, flooding, fire and earthquakes. It is not always possible to insure against
these risks. Should events such as these arise, they could reduce or eliminate our assets and shareholder equity as
well as result in increased costs and/or a decline in the value of our assets or common shares. We expect to maintain
general liability, director and officer insurance, and some insurance against our assets but not with the expectation of
full replacement value. We may decide to update or amend our insurance portfolio in the future if coverage is
available at economically viable rates.
Increased competition could adversely affect our ability to attract necessary capital funding.
The mining industry is intensely competitive and we must compete with other individuals and companies,
many of which have greater financial resources, operational experience and technical capabilities than we have.
This competition from other mining companies could adversely impact our efforts to hire experienced mining
professionals. Competition for resources at all levels can be very intense, particularly affecting the availability of
manpower, drill rigs, mining equipment and production equipment. Increased competition could adversely affect our
ability to attract necessary capital funding or attract or retain key personnel or outside technical resources.
Land reclamation requirements for our properties may be burdensome or too expensive.
Although variable depending on location and the governing authority, land reclamation requirements are
generally imposed on mineral exploration companies as well as companies with mining operations to minimize
long-term effects of land disturbance.
Reclamation may include requirements to:
control dispersion of potentially deleterious effluents;
reduce mine pit slope or waste dump angles;
treat ground and surface water to drinking water standards; and
reasonably re-establish pre-disturbance vegetation and land forms.