COMMITMENTS AND CONTINGENCIES	9 Months Ended
Sep. 30, 2012
COMMITMENTS AND CONTINGENCIES [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 11 – COMMITMENTS AND CONTINGENCIES The Company will accrue an estimated loss contingency when information is available before the financial statements are issued that indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements and the amount of loss can be reasonably estimated. COMMITMENTS Material Advisors On December 30, 2008, the Company entered into a Management Agreement with Material Advisors LLC, a management services company ("Manager"). The Management Agreement had a term ending on December 31, 2010 with automatic renewal for successive one-year periods unless either Manager or Company provided 90 days prior notice of cancellation to the other party or pursuant to the termination provisions of the Management Agreement. Under the Management Agreement, Manager was to perform or engage others, including Andre Zeitoun, a principal of Manager, Chris Carney and Eric Basroon ("Management Personnel"), to perform senior management services including such services as are customarily provided by a chief executive officer but not (unless otherwise agreed) services customarily provided by a chief financial officer. Pursuant to the Management Agreement, Andre Zeitoun served as the Company's Chief Executive Officer and was appointed as a member of the Company's Board of Directors. The services provided by Manager included, without limitation, addressing business and financial matters with the Board of Directors of the Company and the Company's management. The three listed employees provide services exclusively to the Company and Manager has no activities outside of its relationship with the Company. Manager was paid an annual fee of $1,000,000 per year, payable in equal monthly installments of $83,333. Manager was solely responsible for the compensation of the Management Personnel, including Mr. Zeitoun, and the Management Personnel were not entitled to any direct compensation or benefits from the Company (including, in the case of Mr. Zeitoun, for service on the Board). The Company granted Manager non-qualified stock options to purchase, for $0.70 per share, up to 6,583,277 shares of the Company's common stock vesting over a period of three years. In March 2010, the management agreement was extended through December 31, 2011. On February 8, 2011, the Company's Board of Directors extended the management agreement between the Company and Materials Advisors for an additional year. The extension continues Manager's services through December 31, 2012. The extension included the option to purchase 2,904,653 shares of the Company's common stock at an exercise price of $0.83. The vesting of such options began January 1, 2012 and will vest equally over the twelve-month period ending December 31, 2012. As of January 1, 2012, the Company's management agreement with the Manager was amended. The amendments included: (i) the Company is to be responsible for any employee benefits provided to the members of the Manager; and (ii) the Company is to be solely responsible for all travel, entertainment, office and marketing expenses and all other ordinary and necessary business expenses incurred by the Manager and its members in connection with the services provided under the 2012 Agreement. On January 17, 2012, the Company's Board of Directors unanimously agreed to pay a performance bonus of $750,000 to the Manager. Office Lease On February 24, 2012, the Company entered into an extension of their lease agreement to commence on April 1, 2012. The lease is to expire on December 31, 2012 with an option to extend the lease through December 31, 2014. A deposit of $68,958 was paid on March 31, 2012. The monthly rent will be $11,614 for 2012, $11,963 for 2013, and $12,322 for 2014, if the Company makes the decision to extend the lease for 2013 and 2014. Milling Equipment On May 11, 2012, the Company entered into a contract to purchase milling equipment for $956,000. The Company anticipates the milling equipment to be in operation by the fourth quarter of 2012. During the quarter ended June 30, 2012 the Company paid a 30% deposit and an additional $15,000 for engineering services. These deposits in the amount of $301,800 are included on the Condensed Consolidated Balance Sheet as Deposits in Other Assets, and will be reclassified to Property and Equipment and depreciated after the equipment is delivered and placed into service. Milling Facility On June 6, 2012, the Company entered into a contract to have a milling facility constructed at the mine site. The milling facility which is under construction is included in property and equipment in the amount of $330,659 at September 30, 2012. The Company anticipates the milling facility to be in operation by the fourth quarter of 2012. Contingencies We are involved in or subject to, or may become involved in or subject to, routine litigation, claims, disputes, proceedings and investigations in the ordinary course of business. On October 16, 2012, the Company was named as a defendant in a class-action lawsuit, Lasky v. Apllied Minerals, Inc. et al, filed in U.S.District seeking additonal disclosures in the Company's proxy statement. The complaint (Lasky v. Applied Minerals, Inc. et al) alleges that the disclosures in the proxy statement were defective and as such violated the fiduciary duty of the Company's directors, and further alleges that the Company aided and abetted such violations. The complaint asks for injunctive relief mandating additonal disclosures and appropriate damages for the class. We believe that this lawsuit has no merit and intend to vigorously defend our position. We believe that the fiancial exposure resulting from settlement or an adverse judgment will be limited to the payment of legal fees of the plaintiffs' lawyers and associated costs, which in our opinion will not result in a material, adverse effect on our financial condition, cash flows or results of operations.

NOTE 11 – COMMITMENTS AND CONTINGENCIES

The Company will accrue an estimated loss contingency when information is available before the financial statements are issued that indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements and the amount of loss can be reasonably estimated.

COMMITMENTS

Material Advisors

On December 30, 2008, the Company entered into a Management Agreement with Material Advisors LLC, a management services company ("Manager"). The Management Agreement had a term ending on December 31, 2010 with automatic renewal for successive one-year periods unless either Manager or Company provided 90 days prior notice of cancellation to the other party or pursuant to the termination provisions of the Management Agreement. Under the Management Agreement, Manager was to perform or engage others, including Andre Zeitoun, a principal of Manager, Chris Carney and Eric Basroon ("Management Personnel"), to perform senior management services including such services as are customarily provided by a chief executive officer but not (unless otherwise agreed) services customarily provided by a chief financial officer. Pursuant to the Management Agreement, Andre Zeitoun served as the Company's Chief Executive Officer and was appointed as a member of the Company's Board of Directors.

The services provided by Manager included, without limitation, addressing business and financial matters with the Board of Directors of the Company and the Company's management. The three listed employees provide services exclusively to the Company and Manager has no activities outside of its relationship with the Company. Manager was paid an annual fee of $1,000,000 per year, payable in equal monthly installments of $83,333. Manager was solely responsible for the compensation of the Management Personnel, including Mr. Zeitoun, and the Management Personnel were not entitled to any direct compensation or benefits from the Company (including, in the case of Mr. Zeitoun, for service on the Board). The Company granted Manager non-qualified stock options to purchase, for $0.70 per share, up to 6,583,277 shares of the Company's common stock vesting over a period of three years. In March 2010, the management agreement was extended through December 31, 2011.

On February 8, 2011, the Company's Board of Directors extended the management agreement between the Company and Materials Advisors for an additional year. The extension continues Manager's services through December 31, 2012. The extension included the option to purchase 2,904,653 shares of the Company's common stock at an exercise price of $0.83. The vesting of such options began January 1, 2012 and will vest equally over the twelve-month period ending December 31, 2012.

As of January 1, 2012, the Company's management agreement with the Manager was amended. The amendments included: (i) the Company is to be responsible for any employee benefits provided to the members of the Manager; and (ii) the Company is to be solely responsible for all travel, entertainment, office and marketing expenses and all other ordinary and necessary business expenses incurred by the Manager and its members in connection with the services provided under the 2012 Agreement.

On January 17, 2012, the Company's Board of Directors unanimously agreed to pay a performance bonus of $750,000 to the Manager.

Office Lease

On February 24, 2012, the Company entered into an extension of their lease agreement to commence on April 1, 2012. The lease is to expire on December 31, 2012 with an option to extend the lease through December 31, 2014. A deposit of $68,958 was paid on March 31, 2012. The monthly rent will be $11,614 for 2012, $11,963 for 2013, and $12,322 for 2014, if the Company makes the decision to extend the lease for 2013 and 2014.

Milling Equipment

On May 11, 2012, the Company entered into a contract to purchase milling equipment for $956,000. The Company anticipates the milling equipment to be in operation by the fourth quarter of 2012. During the quarter ended June 30, 2012 the Company paid a 30% deposit and an additional $15,000 for engineering services. These deposits in the amount of $301,800 are included on the Condensed Consolidated Balance Sheet as Deposits in Other Assets, and will be reclassified to Property and Equipment and depreciated after the equipment is delivered and placed into service.

Milling Facility

On June 6, 2012, the Company entered into a contract to have a milling facility constructed at the mine site. The milling facility which is under construction is included in property and equipment in the amount of $330,659 at September 30, 2012. The Company anticipates the milling facility to be in operation by the fourth quarter of 2012.

Contingencies

We are involved in or subject to, or may become involved in or subject to, routine litigation, claims, disputes, proceedings and investigations in the ordinary course of business. On October 16, 2012, the Company was named as a defendant in a class-action lawsuit, Lasky v. Apllied Minerals, Inc. et al, filed in U.S.District seeking additonal disclosures in the Company's proxy statement. The complaint (Lasky v. Applied Minerals, Inc. et al) alleges that the disclosures in the proxy statement were defective and as such violated the fiduciary duty of the Company's directors, and further alleges that the Company aided and abetted such violations. The complaint asks for injunctive relief mandating additonal disclosures and appropriate damages for the class. We believe that this lawsuit has no merit and intend to vigorously defend our position. We believe that the fiancial exposure resulting from settlement or an adverse judgment will be limited to the payment of legal fees of the plaintiffs' lawyers and associated costs, which in our opinion will not result in a material, adverse effect on our financial condition, cash flows or results of operations.