Applied Minerals Inc (AMNL)

[Jagman]

NaturalNano, Inc., merger with shell company...

http://www.sec.gov/Archives/edgar/data/863895/000093173105000207/cementitious-def14c.txt

ALMI mention....

2. TRANSACTIONS WITH ATLAS MINING COMPANY

On December 29, 2004 the Company contracted with Atlas Mining Company (OTC BB:
ALMI) in Utah for the purchase of 500 tons of processed halloysite nanotubes. In
connection with this agreement, the Company agreed to the following scheduled
payments to Atlas Mining payable through their designated distributor:

$125,000 paid on December 29, 2004,
$125,000 paid on June 29, 2005, and
$100,000 payable upon commercial shipments made in excess
of $250,000.

As additional consideration, the Company will pay 10% of the resale cash
proceeds received from unaffiliated third parties, in instances where the
purchase price is in excess of $700 per ton up to a maximum of $2,000 per ton.

Payments made by the Company in accordance with this agreement are presented as
prepaid expenses and will be recognized as expense in the period the nanotubules
are used in the development of proprietary applications and processes or as
customer shipments are made.

On January 28, 2005 the Company was issued a two year warrant for the right to
acquire 750,000 shares of Atlas Mining common stock at $.40 per share. This
warrant expires two years from the original issue date which will be January 28,
2007. Neither the warrant nor the shares of common stock issuable upon exercise
have been registered under the Securities Act of 1933 and as such, are not
readily available for sale or transfer in the public markets.

The fair value of this asset on January 28, 2005 and at June 30, 2005 was
estimated at $180,000 and $352,500, respectively. The warrant has been recorded
as a non-current asset at January 28, 2005 with an offsetting liability included
in accrued expenses. The liability is being amortized over the two year period
commencing January 28, 2005 and reflects the Company's commitment to future
research and development efforts which are expected to benefit both the Company
and Atlas Mining. At June 30, 2005, the remaining liability, included in accrued
expenses, is $135,000. The difference of $45,000 has been offset against
research and development expenses in the accompanying statements of operations.

At June 30, 2005, the warrant was marked-to-market with changes in fair market
value recorded as other investment income.