COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2014

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

10. COMMITMENTS AND CONTINGENCIES

The Company’s uranium recovery operations are subject to federal and state regulations for the protection of the environment, including water quality. These laws frequently change and generally becoming more restrictive. The ongoing costs of complying with such regulations have not been significant to the Company’s annual operating costs. Future closure and reclamation costs are provided for as each pound of uranium is produced on a unit-of- production basis. The Company reviews its reclamation obligations each year and determines the appropriate unit charge. The Company also evaluates the status of current environmental laws and their potential impact on their accrual for costs. The Company believes its operations are in compliance with current environmental regulations.

The Company is from time to time involved in various legal proceedings of a character normally incident to its business. Management believes it has meritorious defenses in all such proceedings and is not aware of any material adverse effect on the Company’s financial condition or results of operations from such proceedings.

In connection with our May 2008 private placement and the March 2012 investment agreement with RCF, the Company executed registration rights agreements pursuant to which the shares issued in the private placement and to RCF were registered. The registration rights agreements provide for penalties in the event they fail to remain effective. At March 31, 2014, the Company’s registration statements were and remain effective.

Change in Control Agreements

The Company has entered into employment agreements with its Chief Executive Officer and Chief Financial Officer and compensation agreements with certain other executive officers of the Company that provide that, in the event of a change in control of the Company (as defined in the agreements), such officers will have certain rights and benefits following a change in control. If in connection with a change in control the employment of such officers is terminated, under certain circumstances, the officers will be entitled to lump-sum payments under the employment agreements or base salary, certain incentive payments and benefits for a period of 24 months under the compensation agreements.