This report contains forward-looking statements

From time to time, Shoshone and its senior managers have made and will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are contained in this report and may be contained in other documents that Shoshone files with the Securities and Exchange Commission. Such statements may also be made by Shoshone and its senior managers in oral or written presentations to analysts, investors, the media and others. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Also, forward-looking statements can generally be identified by words such as "may," "could," "should," "would," "believe," "anticipate," "estimate," "seek," "expect," "intend," "plan" and similar expressions.

Forward-looking statements provide our expectations or predictions of future conditions, events or results. They are not guarantees of future performance. By their nature, forward-looking statements are subject to risks and uncertainties. As such, our actual future results, performance or achievements may differ materially from the results expressed in, or implied by, our forward-looking statements. Please refer to descriptions of these risks set forth in our "Risk Factors" in our most recent Annual Report on Form 10-K for the fiscal year ended September 30, 2008.

Our forward-looking statements speak only as of the date they are made. We do not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.

Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Consolidated Financial Statements and Notes presented elsewhere in this report.

Fiscal Year End Change

References to a fiscal year refer to the calendar year in which such fiscal year ends. Historically, our fiscal year ended on December 31st. However, on September 29, 2008, our board of directors approved a change in our fiscal year end from December 31st to September 30th, effective on September 30, 2008.

Plan of Operation

Effective September 30, 2008, we completed the refurbishment of the mill at our Lakeview property. The total capitalized cost of this refurbishment was $499,681 which began depreciating on October 1, 2008. During the three-month period ended June 30, 2009, we temporarily ceased operations at our Lakeview property pending our raising sufficient funds to proceed with operations. This cessation of operations included terminating the employment of three full time employees. We currently employ three full-time persons at our Lakeview property whose primary goal is continuing to upgrade the crusher and mill areas.

On March 12, 2009, we acquired certain assets from Kimberly Gold Mines, Inc. ("Kimberly") in a transaction where the Company issued 12,145,306 shares of common stock and other consideration in exchange for 100% of Kimberly's common stock. Included in this acquisition were 186 unpatented mining claims located primarily in Idaho and Montana as well as a mill in need of refurbishing and various pieces of equipment. See "Note 13. Acquisition of Assets from Kimberly Gold Mines, Inc." to our consolidated financial statements for further details.

Our primary plan of operations included raising sufficient capital to restart operations at our Lakeview property and also to refurbish our new mill purchased as part of the Kimberly acquisition. Our long-term goal is to mine and mill both silver and gold.

On June 30, 2009, we entered into an agreement with the Xtierra, now known as Orca Minerals Limited ("Orca"). Pursuant to this agreement, we granted Orca a $50,000 discount on the $500,000 due on August 11, 2009, provided Orca made the revised $450,000 payment on or before July 7, 2009. On July 7, 2009,

Please refer to our discussion regarding our ability to continue as a going concern below for further details.

Going Concern

As shown in the accompanying financial statements, we have had limited revenues and incurred an accumulated deficit of $1,004,342 from inception through June 30, 2009. These factors raise substantial doubt about our ability to continue as a going concern. We intend to seek additional capital from new equity securities offerings that will provide funds needed to increase liquidity and fully implement its business plan. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

Historically, we have generally funded our operations with proceeds from the sale of "available-for-sale" investments, royalty and option agreement payments, and from the sale of the Company's common stock. Should we be unsuccessful in any of the initiatives or matters discussed above and unable to raise capital through future private placements, our business, and, as a result, our financial position, results of operations and cash flow will likely be materially adversely impacted. As such, substantial doubt as to our ability to continue as a going concern remains as of the date of these financial statements.

The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence. An estimated $2,000,000 is believed necessary to continue operations and increase development through the next twelve months. Currently, the Company anticipates raising the majority of the $2,000,000 through the issuance of common stock to private investors. The timing and amount of capital requirements will depend on a number of factors, including demand for products and services.

Comparison of the Three and Nine-Month Periods Ended June 30, 2009 and 2008:

Results of Operations

The following tables set forth certain information regarding the components of
our Consolidated Statements of Operations for the three- and nine-month periods
ended June 30, 2009, compared with the same periods in the prior year. These
tables are provided to assist in assessing differences in our overall
performance:

                                  Three-month period ended
                               June 30, 2009     June 30, 2008     $ Change      % Change

REVENUES                     $             -   $             -   $         -         0.00%
COST OF REVENUES                           -                 -             -         0.00%
GROSS PROFIT                               -                 -             -         0.00%
     General and                     255,096           208,182        46,914        22.54%
administrative
     Professional fees                91,935            70,458        21,477        30.48%
     Depreciation                     30,228            13,869        16,359       117.95%
     Mining and exploration           10,272                 -        10,272         0.00%
expenses
     Total Operating                 387,531           292,509        95,022        32.49%
Expenses
LOSS FROM OPERATIONS                (387,531 )        (292,509 )     (95,022 )      32.49%
     Net gain on sale of                 160                 -           160         0.00%
securities
     Dividend and interest            28,053             4,725        23,328       493.71%
income
     Interest expense                   (464 )          (1,252 )         788       -62.94%
     Other income                    (50,000 )               -       (50,000 )       0.00%
           Total Other               (22,251 )           3,473       (25,724 )    -740.69%
Income (Expenses)
NET (LOSS)                   $      (409,782 ) $      (289,036 ) $  (120,746 )      41.78%

                                   Nine-month period ended
                               June 30, 2009     June 30, 2008     $ Change      % Change

REVENUES                     $         6,655   $           180   $     6,475       3597.2%
COST OF REVENUES                          74                95           (21 )      -22.1%
GROSS PROFIT                           6,581                85         6,496       7642.4%
     General and                     792,869           387,545       405,324        104.6%
administrative
     Professional fees               240,584           162,073        78,511         48.4%
     Depreciation                     87,836            39,485        48,351        122.5%
     Mining and exploration          168,994            37,423       131,571        351.6%
expenses
           Total Operating         1,290,283           626,526       663,757        105.9%
Expenses
LOSS FROM OPERATIONS              (1,283,702 )        (626,441 )    (657,261 )      104.9%
     Lease income                          -             2,514        (2,514 )     -100.0%
     Net gain on sale of                (844 )          33,585       (34,429 )     -102.5%
securities
     Dividend and interest            93,097            16,330        76,767        470.1%
income
     Interest expense                 (1,834 )          (2,936 )       1,102        -37.5%
     Other income                    (50,000 )           4,659       (54,659 )    -1173.2%
           Total Other                40,419            54,152       (13,733 )      -25.4%
Income (Expenses)
NET (LOSS)                   $    (1,243,283 ) $      (572,289 ) $  (670,994 )      117.2%

Overview of Operating Results

The increase in the net loss incurred during the both three- and nine-month periods ended June 30, 2009, compared with the same periods last year is primarily attributable to increased payroll expenses associated with incremental personnel. However, during the three-month period ended June 30, 2009, we terminated the employment of three employees related to the cessation of operations at our Lakeview property. This mitigated the negative impact of increased payroll expenses during the 2009 periods.

Also contributing to the net loss during both periods was a $50,000 discount for early payment on a note receivable granted to Orca Minerals Limited ("Orca"). The discount was granted on the $500,000 due on August 11, 2009, provided Orca made the revised $450,000 payment on or before July 7, 2009. The discount of $50,000 was included in our Consolidated Statements of Operations as an "Other Expense" and as a corresponding reduction to the current portion of the note receivable on our Consolidated Balance Sheets. On July 7, 2009, we received the $450,000 due under the revised terms of the note receivable from Orca.

The increase in net loss during the nine-month period ended June 30, 2009, was also impacted by the recording of an allowance for doubtful accounts associated with a $53,548 note receivable from a related party.

Operating Expenses

The increases in operating expenses during both the three- and nine-month periods ended June 30, 2009, compared with the same periods last year were primarily due to increased salaries and related expenses of $47,932 and 222,516, respectively. However, during the three-month period ended June 30, 2009, we terminated the employment of three employees related to the cessation of operations at our Lakeview property. This mitigated the negative impact of increased payroll expenses during the 2009 periods.

During the recent nine-month period, exploration expenses increased $126,285 compared with the same period last year. On March 3, 2009, a related party who owed the Company $53,548 filed a voluntary petition for reorganization relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Idaho. Based on this filing, the Company created an allowance for this account receivable in the amount of $53,548.

Other Income (Expenses)

The decrease in other income (expenses) during the three-month period ended March 31, 2009, compared with the same period last year was primarily attributable to a $50,000 discount for early payment on a note receivable granted to Orca Minerals Limited. Partially offsetting this negative impact was the recognition of imputed interest income of $23,317 during the most recent three-month period compared with $0 last year.

The decrease in other income (expenses) during the nine-month period ended June 30, 2009, compared with the same period last year was primarily attributable to the negative impacts of a $50,000 discount for early payment on a note receivable granted to Orca Minerals Limited and the realization of a net loss on the sale of available-for-sale securities. During the nine-month period ended June 30, 2008, we realized a net gain on the sale of available for sale securities of $33,585 compared with a net loss of $844 during the most recent nine-month period. Partially offsetting these negative impacts was the recognition of imputed interest income of $69,951 during the most recent nine-month period compared with $0 last year.

Overview of Financial Position

At June 30, 2009, we had cash of $12,835 and total liabilities of $190,156. On June 30, 2009, we entered into an agreement with the Xtierra, now known as Orca Minerals Limited ("Orca"). Pursuant to this agreement, we granted Orca a $50,000 discount on the $500,000 due on August 11, 2009, provided Orca made the revised $450,000 payment on or before July 7, 2009. On July 7, 2009, we received the $450,000 due under the revised terms of the note receivable from Orca.

Property, Plant and Equipment
At June 30, 2009, property, plant and equipment before accumulated depreciation totaled $2,771,010, an increase of $185,915 from $2,585,095 at September 30, 2008. Most of the increase related to equipment purchases at its Lakeview property.

Mineral and Mining Properties
At June 30, 2009 mineral and mining properties totaled $2,696,369, an increase of $2,316,679 from $379,690 at September 30, 2008. On March 12, 2009, the Company acquired mineral properties from Kimberly Gold Mines, Inc. ("Kimberly") in a transaction where the Company issued 12,145,306 shares of common stock and other consideration in exchange for 100% of Kimberly's common stock. This transaction was valued at $2,185,126 and was recorded to Mineral Properties.

Also, on February 2, 2009, the Company received a Quitclaim Deed releasing the property that was the collateral of a note receivable with a principal and accrued interest balance of $131,553. The Company determined the fair value of the reclaimed property to equal the sum of the principal and accrued interest balances.

Investments
Our investment portfolio at June 30, 2009, was $321,980, a decrease of $34,843 from the September 30, 2008, balance of $356,823, primarily as a result of the de-recognition of 321,500 shares of Kimberly's common stock with a cost basis of $38,035. The cost basis of this common stock was allocated to the

Notes Receivable from Related Parties
At June 30, 2009, notes receivable from related parties totaled $3,716, a decrease of $200,000 from $203,716 at September 30, 2008. The decrease was a result of the de-recognition of the Kimberly note receivable in connection with our acquisition of certain assets from Kimberly. The $222,408 value of the Kimberly note receivable and accrued interest was included in the purchase price of the acquired mineral properties.

Accrued Expenses and Other Liabilities
Our accounts payable were $163,963 at June 30, 2009, a decrease of $31,544 from $195,507 at September 30, 2008.

The June 30, 2009 accounts payable balance included $72,887 that we assigned to certain liabilities assumed in connection with the acquisition of assets from Kimberly. This balance also included $43,448 in legal expenses primarily related to the Kimberly acquisition.

The September 30, 2008 accounts payable balance included $48,500 in compensation expense associated with a settlement agreement entered into by the Company with its former Chief Executive Officer, and included $50,000 associated with our acquisition of a 50% interest in a commercial office building in Coeur d'Alene, Idaho.

Notes Payable
During the third quarter of 2007, we acquired equipment for $55,000 by paying $27,500 cash and signing a note for the remaining $27,500. The note has a term of 24 months, bears interest at 8.50% annually and stipulates that payments of $1,250 be made monthly. The outstanding balance on this note payable was $4,913 at June 30, 2009 and is payable within twelve months.

In December 2007, we purchased equipment for $15,377 in exchange for a note. The note has a term of 43 months, bears interest at 3.90% annually and stipulates that payments of $384 be made monthly. The lender has the right to increase the interest rate to 19.8% in the event of a violation of the terms of the loan agreement. The outstanding balance on this note payable was $9,194 at June 30, 2009. Of this amount $4,331 is payable within twelve months.

In December 2008, we purchased for $21,752 a one-year liability insurance policy covering our Lakeview mill (the "Policy"). The Policy was purchased with a cash payment of $5,813 with the balance of $15,939 settled with a promissory note. We recorded prepaid insurance of $21,752 and a related entry to record a $15,939 note payable. The note has a term of nine months, bears interest at 9.15% annually and stipulates that payments of $1,839 be made monthly. The outstanding balance on this note payable was $5,445 at June 30, 2009, all of which is payable within twelve months.

Stockholders' Equity
Our total stockholders' equity was $6,199,068 at June 30, 2009, an increase of $558,048 from $5,641,020 at September 30, 2008. The increase in total stockholders' equity was primarily due to the issuance of 12,145,306 shares of common stock issued in exchange for certain asserts of Kimberly Gold Mines, Inc. Partially offsetting this positive impact was a net loss of $1,243,283 incurred during the nine-month period ended June 30, 2009.

Also, contributing to the decrease in total stockholders' equity was a decrease of $47,005 in accumulated other comprehensive income. Fluctuations in prevailing market values continue to cause volatility in the Company's accumulated comprehensive income or loss in stockholders' equity and may continue to do so in future periods.

Liquidity and Capital Resources

Operating Activities
During the nine-month period ended June 30, 2009, our operating activities used $1,225,942 and used $326,376 during the comparable period last year. This reduction was primarily the result of the realization

Investing Activities
During the nine-month period ended June 30, 2009, our investing activities used $276,064 and used $80,340 during the same period last year. This was primarily the result of $105,361 in proceeds from the sale of investments received during the nine-month period ended June 30, 2008 compared with $1,488 during the nine-month period ended June 30, 2009.

Financing Activities
During the nine-month period ended June 30, 2009, our financing activities used $55,225 and contributed $405,145 during the same period last year. This was primarily due to net proceeds of $285,985 received from the issuance common stock during the nine-month period last year, compared with none during the current nine-month period.

Off-Balance Sheet Arrangements

The Company is not currently a party to any off-balance sheet arrangements as they are defined in the regulations promulgated by the Securities and Exchange Commission.