UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 8-K

 

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Earliest Event Reported:  May 17, 2019

 

General Moly, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-32986

 

91-0232000

(State or other jurisdiction
of incorporation)

 

(Commission
file number)

 

(IRS employer
identification no.)

 

1726 Cole Blvd., Suite 115
Lakewood, CO 80401
(Address of principal executive offices, including zip code)

 

(303) 928-8599
(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

 

o             Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o             Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o             Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 210.14d-2(b))

 

o             Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which
registered

Common Stock, par value $0.001 per share

 

GMO

 

NYSE American and Toronto Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)

 

Emerging growth company      o

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

 

 

 

Item 3.02                    Unregistered Sales of Equity Securities

 

As previously disclosed, General Moly, Inc. (the “Company”) executed a Securities Purchase Agreement (the “MHMI Purchase Agreement”) with Mount Hope Mines, Inc. (“MHMI”).  Pursuant to the MHMI Purchase Agreement, MHMI agreed to  purchase $500,000 of convertible shares of Series A Preferred Stock, par value $0.001 per share (the “Preferred Stock”), of the Company.

 

The Preferred Stock is being issued at a price of $100.00 per share, and each share of the Preferred Stock will be convertible at any time at the holder’s discretion into 370.37 shares of common stock of the Company.  The Preferred Stock carries a 5% annual dividend, which may be paid, in the Company’s sole discretion, in cash, additional shares of Preferred Stock or a combination thereof.  The Preferred Stock will vote together with the Company’s common stock as a single class on an as-converted basis.  The Preferred Stock is mandatorily redeemable at such time that the Company’s senior convertible promissory notes issued in December 2014 become due and payable in accordance with their terms, as such terms may be modified from time to time.

 

On May 17, 2019, the Company and MHMI completed the closing of 5,000 shares of Preferred Stock for a purchase price of $500,000.  The offer, issuance and sale of the Preferred Stock is being made pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended, under Section 4(a)(2) and Rule 506(b) of Regulation D promulgated thereunder.

 

The foregoing description of the MHMI Purchase Agreement does not purport and is not intended to be complete and is qualified in its entirety by reference to the full text of the MHMI Purchase Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1, and is incorporated herein by reference.

 

In addition, on May 20, 2019, the Company requested the third closing under the Securities Purchase Agreement dated effective March 21, 2019, by and among the Company and Bruce D. Hansen, the Company’s Chief Executive Officer, and Robert I. Pennington, the Company’s Chief Operating Officer (the “Investors”).  The third closing, which will occur on or before May 28, 2019, will be in the amount of $300,000 of Preferred Stock, or 3,000 shares, as follows:

 

Investor Name

 

Number of Shares of Preferred Stock

 

 

 

 

 

Bruce D. Hansen

 

2,667

 

 

 

 

 

Robert I. Pennington

 

333

 

 

The offer, issuance and sale of the Preferred Stock is being made pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended, under Section 4(a)(2) and Rule 506(b) of Regulation D promulgated thereunder. In accordance with the Company’s policies for approving related party transactions, this transaction was approved by

 

2

 

the Audit Committee of the Company’s Board of Directors, as well as the disinterested members of the full Board of Directors.

 

Item 8.01                    Other Events

 

As previously disclosed, Eureka Moly, LLC (“Eureka Moly”) has entered into a settlement agreement with a Kobeh Valley, Nevada ranching family (“Ranchers”), resolving the last set of protests pending before the Nevada State Engineer pertaining to the Mt. Hope Project’s water rights applications.

 

On May 17, 2019, Eureka Moly funded an initial payment of $1 million into a trust account in accordance with the terms of the settlement agreement; distribution to the Ranchers will be pending issuance of the water permits.  With receipt of the payment of this amount into the trust, on May 21, 2019, the Ranchers filed their withdrawal of all protests and forfeiture of any judicial review of the anticipated approval of the water applications and issuance of the water permits from the Nevada State Engineer.  Additionally, the Ranchers have agreed not to oppose any other proceedings with any state or federal agency related to the Mt. Hope Project.

 

Under this settlement, the Company is working with the Nevada State Engineer to address potential permit terms for approval of the applications and receiving the water permits.

 

On May 23, 2019, the Company issued a press release announcing the foregoing matters.  A copy of the press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 9.01                            Financial Statements and Exhibits

 

(d)           Exhibits

 

Exhibit No.

 

Description

 

 

 

3.1

 

Certificate of Designations of Series A Preferred Stock (Filed as Exhibit 3.1 to our Current Report on Form 8-K filed on March 28, 2019.)

10.1

 

Securities Purchase Agreement dated effective May 17, 2019, by and among General Moly, Inc. and each of the persons whose names are set forth on the Schedule of Investors attached thereto as Exhibit A.

10.2

 

Securities Purchase Agreement dated effective March 21, 2019, by and among General Moly, Inc. and each of the persons whose names are set forth on the Schedule of Investors attached thereto as Exhibit A (Filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 28, 2019.)

99.1

 

Press Release of General Moly, Inc. dated May 23, 2019.

 

3

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

GENERAL MOLY, INC.

 

 

Dated: May 23, 2019

By:

/s/ Amanda Corrion

 

 

Amanda Corrion

 

 

Principal Accounting Officer

 

4

Exhibit 10.1

 

GENERAL MOLY, INC.

 

SECURITIES PURCHASE AGREEMENT

 

THIS SECURITIES PURCHASE AGREEMENT (the “ Agreement ”) dated as of May 2, 2019, is made and entered into by and among General Moly, Inc., a Delaware corporation (the “ Company ”), and Mount Hope Mines, Inc., a Colorado corporation (the “ Investor ”).

 

RECITALS

 

WHEREAS, the Company desires to sell to the Investor, and the Investor desires to purchase, $500,000 of Preferred Shares (as defined below).

 

NOW, THEREFORE, In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties agree as follows:

 

AGREEMENT

 

1.                                       Certain Definitions:

 

“ 1933 Act ” means the Securities Act of 1933, as amended.

 

“ Affiliate ” means, as to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such Person.  As used in this definition, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).

 

“ Agreement ” has the meaning set forth in the Recitals.

 

“ Audited Financial Statements ” has the meaning set forth in Section 3.7(d).

 

“ Blue Sky Laws ” means any state securities or “blue sky” laws.

 

“ Business Day ” means any day other than a Saturday, Sunday or any other day on which The Federal Reserve Bank of New York is authorized or required by law or executive order to close or be closed.

 

“ Bylaws ” has the meaning set forth in Section 3.2.

 

“ Certificate of Designations ” means the Certificate of Designations in the form that is attached hereto as Exhibit B .

 

“ Certificate of Incorporation ” has the meaning set forth in Section 3.2.

 

“ Closing ” has the meaning set forth in Section 2.2.

 

 

“ Closing Date ” has the meaning set forth in Section 2.2.

 

“ Closing Notice ” has the meaning set forth in Section 2.2.

 

“ Common Stock ” means the Company’s Common Stock, $0.001 par value per share, authorized as of the date hereof, and any stock of any class or classes (however designated) hereafter authorized upon reclassification thereof, which, if the Board of Directors declares a dividend or distribution, has the right to participate in the distribution of earnings and assets of the Company after the payment of dividends or other distributions on any shares of capital stock of the Company entitled to a preference and in the voting for the election of directors of the Company.

 

“ Company ” has the meaning set forth at the head of this Agreement and any corporation or other entity which shall succeed to or assume, directly or indirectly, the obligations of the Company hereunder.  The term “corporation” shall include an association, joint stock company, business trust, limited liability company or other similar organization.

 

“ Contemplated Transactions ” has the meaning set forth in Section 3.1(b).

 

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

 

“ Financial Statements ” has the meaning set forth in Section 3.7(d).

 

“ Governmental Body ” shall mean any: (i) nation, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature in the United States; (ii) federal, state, local, municipal, foreign or other government; or (iii) governmental or quasi-governmental authority of any nature (including any governmental division, department, agency, commission, instrumentality, official, organization, unit, body or entity and any court or other tribunal) in the United States.

 

“ Indemnified Party ” has the meaning set forth in Section 6.2(b).

 

“ Indemnifying Party ” has the meaning set forth in Section 6.2(c).

 

“ Knowledge ” shall mean, with respect to a particular fact or other matter, the knowledge, after reasonable investigation, of the Chief Executive Officer/Chief Financial Officer or Chief Operating Officer of the Company.

 

“ Losses ” has the meaning set forth in Section 6.2(b).

 

“ Material Adverse Effect ” has the meaning set forth in Section 3.1(a).

 

“ Material Agreement ” has the meaning set forth in Section 3.6.

 

“ Person ” means any individual, sole proprietorship, partnership, corporation, limited liability company, business trust, unincorporated association, joint stock corporation, trust, joint venture or other entity, any university or similar institution, or any government or any agency or instrumentality or political subdivision thereof.

 

2

 

“ Preferred Shares ” means shares of the Company’s Series A Preferred Stock, par value $0.001 per share, to be created pursuant to the Certificate of Designations.

 

“ Rule 144 ” means Rule 144 promulgated under the 1933 Act or any successor or substitute rule, law or provision.

 

“ SEC ” means the Securities and Exchange Commission.

 

“ SEC Documents ” has the meaning set forth in Section 3.7(a).

 

“ Securities ” means the Preferred Shares and the Underlying Securities.

 

“ Subsidiary ” means any significant subsidiary (as defined under Rule 1.02(w) of Regulation S-X promulgated by the SEC) of the Company.

 

“ Transaction Documents ” means this Agreement and the Certificate of Designations and any letter agreement entered into between the parties hereto with respect to the Preferred Shares.

 

“ Unaudited Financial Statements ” has the meaning set forth in Section 3.7(d).

 

“ Underlying Securities ” means the shares of Common Stock that are issuable from time to time issuable upon conversion of the Preferred Shares.

 

2.                                       Purchase and Sale of Securities.

 

2.1                                Sale and Issuance of Securities .  The Company shall sell to the Investor, and the Investor shall purchase from the Company, Preferred Shares at a price equal to $100.00 per share, as set forth in more detail below.

 

2.2                                Closing .  The Closing shall take place on the date that is two (2) Business Days after the date hereof, or such other date thereafter, as shall be determined by the Company with the consent of the Investor (the “ Closing Date ”).  The Closing shall take place at the offices of Bryan Cave Leighton Paisner LLP, counsel to the Company, in Denver, Colorado, or at such other location as is mutually acceptable to the Investor and the Company, subject to fulfillment of the conditions to the Closing set forth in the Agreement.  At the Closing:

 

(a)                                  The Investor shall deliver to the Company or its designees prior to the Closing by wire transfer or such other method of payment as the Company shall approve, an amount equal to the purchase price of Preferred Shares to be purchased by the Investor; and

 

(b)                                  the Company shall deliver to the Investor the number of Preferred Shares registered in the name of the Investor, or in such nominee name(s) as designated by the Investor in writing, representing the number of Preferred Shares to be issued to the Investor.

 

3

 

2.3                                Investor’s Conditions to Closing .  The obligation of the Investor to complete the purchase of Preferred Shares at the Closing is subject to the Company delivering Preferred Shares as set forth in Section 2.2 and to fulfillment of the following conditions:

 

(a)                                  the representation and warranties of the Company set forth in this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of such Closing Date (except to the extent such representations and warranties speak as of an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date), and the Company shall have performed in all material respects all covenants and other obligations required to be performed by it under this Agreement at or prior to such Closing Date, and the Investor shall have received a certificate signed on behalf of the Company by an authorized officer of the Company to such effect; and

 

(b)                                  the Company shall have executed and delivered all other documents reasonably requested by counsel for the Investor.

 

2.4                                Company’s Conditions to Closing .  The obligation of the Company to complete the sale of the Preferred Shares at the Closing is subject to fulfillment of the following conditions:

 

(a)                                  the representation and warranties of the Investor set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (except to the extent such representations and warranties speak as of an earlier date), in which case such representations and warranties shall be true and correct in all material respects as of such earlier date), and

 

(b)                                  the Investor shall have performed in all material respects all covenants and other obligations required to be performed by it under this Agreement, if any, at or prior to the Closing Date.

 

3.                                       Representations and Warranties of the Company.  The Company hereby represents and warrants to the Investor as follows:

 

3.1                                Corporate Organization; Authority; Due Authorization .

 

(a)                                  The Company (i) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, (ii) has the corporate power and authority to own or lease its properties as and in the places where its business is now conducted and to carry on its business as now conducted, and (iii) is duly qualified as a foreign corporation authorized to do business in every jurisdiction where the failure to so qualify, individually or in the aggregate, would have a material adverse effect on the operations, assets, liabilities, financial condition or business

 

4

 

of the Company and its Subsidiaries taken as a whole (a “ Material Adverse Effect ”).

 

(b)                                  The Company (i) has the requisite corporate power and authority to execute, deliver and perform this Agreement and the other Transaction Documents to which it is a party and to incur the obligations herein and therein and (ii) has been authorized by all necessary corporate action to execute, deliver and perform this Agreement and the other Transaction Documents to which it is a party and to consummate the transactions contemplated hereby and thereby (the “ Contemplated Transactions ”).  This Agreement is and each of the other Transaction Documents will be on the Closing Date a valid and binding obligation of the Company enforceable in accordance with its terms except as limited by applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting the enforcement of creditors’ rights and the availability of equitable remedies (regardless of whether such enforceability is considered in a proceeding at law or equity).

 

3.2                                Capitalization .  As of the date hereof, the authorized capital stock of the Company consists of (a) six hundred fifty million (650,000,000) shares of Common Stock, $0.001 par value, of which 137,526,132 shares are issued and outstanding and (b) ten million (10,000,000) shares of preferred stock, $0.001 per value, of which none are issued and outstanding, 55,000 of which have been designated as the Preferred Shares of which have been designated as the Preferred Shares.  Except as contemplated by this Agreement or as set forth in the SEC Documents, there are (A) no outstanding subscriptions, warrants, options, conversion privileges or other rights or agreements obligating the Company to purchase or otherwise acquire or issue any shares of capital stock of the Company (or shares reserved for such purpose), (B) no preemptive rights contained in the Company’s Certificate of Incorporation, as amended (the “ Certificate of Incorporation ”), the Company’s Amended and Restated Bylaws (the “ Bylaws ”) or contracts to which the Company is a party or other rights of first refusal with respect to the issuance of additional shares of capital stock of the Company, including without limitation the Preferred Shares and the Underlying Securities, and (C) no commitments or understandings (oral or written) of the Company to issue any shares, warrants, options or other rights to acquire any equity securities of the Company.  Except as set forth in the SEC Documents, no Persons have any anti-dilution rights of any kind, whether triggered by the Contemplated Transactions or otherwise.  To the Company’s Knowledge, except as set forth in the SEC Documents, none of the shares of Common Stock are subject to any stockholders’ agreement, voting trust agreement or similar arrangement or understanding.  Except as set forth in the SEC Documents, the Company has no outstanding bonds, debentures, notes or other obligations the holders of which have the right to vote (or which are convertible into or exercisable for securities having the right to vote) with the stockholders of the Company on any matter.

 

5

 

3.3                                Validity of Securities .  The issuance of the Preferred Shares has been duly authorized by all necessary corporate action on the part of the Company. The Certificate of Designations has been duly authorized by all necessary corporate action on the part of the Company and duly filed with the Secretary of State of the State of Delaware.

 

3.4                                Underlying Securities .  (a) The issuance of the Underlying Securities upon conversion of the Preferred Shares has been duly authorized, (b) the Underlying Securities prior to such conversion will have been duly reserved for issuance upon such exercise and (c) when so issued, the Underlying Securities will be validly issued, fully paid and non-assessable.

 

3.5                                Brokers and Finders . The Company has not retained any broker, investment banker or finder in connection with the Contemplated Transactions and will not owe any fees to any broker, investment banker or finder under a tail or similar covenant from an earlier engagement or financing.

 

3.6                                No Conflict; Required Filings and Consents .

 

(a)                                  The execution, delivery and performance of this Agreement and the other Transaction Documents by the Company do not, and the consummation by the Company of the Contemplated Transactions will not, (i) conflict with or violate the Certificate of Incorporation or the Bylaws of the Company or its Subsidiaries, (ii) conflict with or violate any law, rule, regulation, order, judgment or decree applicable to the Company or its Subsidiaries or by which any property or asset of the Company or its Subsidiaries is bound or affected, or (iii) except as provided in Section 6.7 hereof, result in any breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, result in the loss of a material benefit under, or give to others any right of purchase or sale, or any right of termination, amendment, acceleration, increased payments or cancellation of, or result in the creation of a lien or other encumbrance on any property or asset of the Company or of any of its Subsidiaries pursuant to, any material note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Company or any of its Subsidiaries is a party or by which the Company or of any of its Subsidiaries or any property or asset of the Company or of any of its Subsidiaries is bound or affected (the “ Material Agreements ”); except, in the case of clauses (ii) and (iii) above, for any such conflicts, violations, breaches, defaults or other occurrences that would not prevent or delay consummation of any of the Contemplated Transactions in any material respect or otherwise prevent the Company from performing its obligations under this Agreement or any of the other Transaction Documents in any material respect, and would not, individually or in the aggregate, have a Material Adverse Effect.

 

6

 

(b)                                  The execution and delivery of this Agreement and the other Transaction Documents by the Company do not, and the performance of this Agreement and the other Transaction Documents and the consummation by the Company of the Contemplated Transactions will not, require, on the part or in respect of the Company, any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Body (as hereinafter defined) except for the filing of a Form D with the SEC and applicable requirements, if any, of the Exchange Act or Blue Sky Laws, and any approval required by applicable rules of the markets in which the Company’s securities are traded.

 

3.7                                SEC Documents; Financial Statements .

 

(a)                                  The information contained in the following documents, did not, as of the date of the applicable document, include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading, as of their respective filing dates or, if amended, as so amended (the following documents, collectively, the “ SEC Documents ”), provided that the representation in this sentence shall not apply to any misstatement or omission in any SEC Document filed prior to the date of this Agreement which was superseded by a subsequent SEC Document filed prior to the date of this Agreement:

 

(i)                                      the Company’s Annual Report on Form 10-K for the year ended December 31, 2018; and

 

(ii)                                   the Company’s Current Reports on Form 8-K filed on January 22, 2019, March 15, 2019 and March 28, 2019.

 

(b)                                  The Company has filed all forms, reports and documents required to be filed by it with the SEC for the 12 months preceding the date of this Agreement, including without limitation the SEC Documents.  As of their respective dates, the SEC Documents filed prior to the date hereof complied as to form in all material respects with the applicable requirements of the 1933 Act, the Exchange Act, and the rules and regulations thereunder.

 

(c)                                   The Company’s Annual Report on Form 10-K for the year ended December 31, 2018, includes audited consolidated balance sheets as of December 31, 2018 and 2017, consolidated statements of operations and consolidated statements of cash flows for the one year periods then ended (the “ Financial Statements ”).

 

(d)                                  The Financial Statements (including the related notes and schedules thereto) fairly present in all material respects the consolidated financial

 

7

 

position, the results of operations, retained earnings or cash flows, as the case may be, of the Company for the periods set forth therein (subject, in the case of the Unaudited Financial Statements, to normal year-end audit adjustments that would not be material in amount or effect), in each case in accordance with generally accepted accounting principles consistently applied during the periods involved, except as may be noted therein.

 

3.8                                Corporate Documents .  The Company’s Certificate of Incorporation and Bylaws, each as amended to date, which are certified as of the Closing Date are true, correct and complete and contain all amendments thereto.

 

4.                                       Representations and Warranties of the Investor.  The Investor represents and warrants to the Company as follows:

 

4.1                                Authorization .  Such Investor (x) has full power and authority to execute, deliver and perform this Agreement and the other Transaction Documents to which it is a party and to incur the obligations herein and therein and (y) if applicable, has been authorized by all necessary corporate or equivalent action to execute, deliver and perform this Agreement and the other Transaction Documents and to consummate the Contemplated Transactions.  This Agreement is and each of the other Transaction Documents will be upon the execution and delivery by such Investor, a valid and binding obligation of such Investor enforceable in accordance with its terms, except as limited by applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting the enforcement of creditors’ rights and the availability of equitable remedies (regardless of whether such enforceability is considered in a proceeding at law or equity).

 

4.2                                Brokers and Finders .  Such Investor has either not retained an investment banker, broker or finder, or has provided the name and information concerning such entity to the Company on or prior to the Closing Date.

 

4.3                                No Governmental Review .  Such Investor understands that no United States Federal or state agency or any other Governmental Body has passed on or made any recommendation or endorsement of the Preferred Shares or the fairness or suitability of the investment in the Preferred Shares nor has any agency or other Governmental Body passed upon or endorsed the merits of the offering of the Preferred Shares.

 

4.4                                Accredited Investor Status . As more fully set forth in the Accredited Investor Questionnaire to be delivered by the Investor to the Company in the form attached hereto as Exhibit C , the Investor is an “accredited investor” as such term is defined in Regulation D promulgated under the Preferred Shares Act.  The information provided by the Investor in the Questionnaire is true, complete and correct in all respects.

 

8

 

4.5                                No Conflict; Required Filings and Consents .

 

(a)                                  The execution, delivery and performance of this Agreement and the other Transaction Documents by the Investor do not, and the consummation by such Investor of the Contemplated Transactions will not, (i) conflict with or violate the certificate of incorporation or the bylaws (or equivalent or comparable documents) of such Investor, (ii) conflict with or violate any law, rule, regulation, order, judgment or decree applicable to such Investor or by which any property or asset of such Investor is bound or affected, or (iii) result in any breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, result in the loss of a material benefit under, or give to others any right of purchase or sale, or any right of termination, amendment, acceleration, increased payments or cancellation of, or result in the creation of a lien or other encumbrance on any property or asset of such Investor pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which such Investor is a party or by which such Investor or any property or asset of such Investor is bound or affected; except, for any such conflicts, violations, breaches, defaults or other occurrences that would not prevent or delay consummation of any of the Contemplated Transactions in any material respect or otherwise prevent such Investor from performing its obligations under this Agreement or any of the other Transaction Documents in any material respect.

 

(b)                                  The execution and delivery of this Agreement and the other Transaction Documents by the Investor do not, and the performance of this Agreement and the other Transaction Documents and the consummation by such Investor of the Contemplated Transactions will not, require, on the part or in respect of such Investor, any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Body.

 

5.                                       Securities Laws.

 

5.1                                Securities Laws Representations and Covenants of the Investor .

 

(a)                                  The Investor represents and warrants to the Company that: this Agreement is made by the Company with such Investor in reliance upon such Investor’s representation to the Company, which by such Investor’s execution of this Agreement such Investor hereby confirms, that the Preferred Shares to be received by such Investor will be acquired for investment for such Investor’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof such that such Investor would constitute an “underwriter” under the 1933 Act; provided that this representation and warranty shall not limit (i) the Investor’s right to sell the Underlying Securities in compliance with an exemption from registration under the 1933 Act and in compliance with

 

9

 

all applicable federal securities laws and Blue Sky Laws or (ii) the Investor’s rights to indemnification under this Agreement.

 

(b)                                  The Investor understands and acknowledges that (i) the offering of the Preferred Shares pursuant to this Agreement will not be registered under the 1933 Act or qualified under any Blue Sky Laws on the grounds that the offering and sale of the Preferred Shares are exempt from registration and qualification, respectively, under the 1933 Act and the Blue Sky Laws, (ii) nothing in this Agreement or any of the other Transaction Documents or in any other materials presented by or on behalf of the Company to such Investor in connection with the purchase of Securities constitutes legal, tax or investment advice, (iii) such Investor has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or appropriate in connection with its purchase of Securities and (iv) if the Preferred Shares have not been registered under the 1933 Act and Rule 144 is not applicable, any resale of the Preferred Shares under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder.

 

(c)                                   The Investor covenants that, unless the Preferred Shares, the Underlying Securities or any other shares of capital stock of the Company received in respect of the foregoing have been registered, such Investor will not dispose of such securities unless and until such Investor shall have notified the Company of the proposed disposition and shall have furnished the Company with an opinion of counsel reasonably satisfactory in form and substance to the Company to the effect that (i) such disposition will not require registration under the 1933 Act and (ii) appropriate action necessary for compliance with the 1933 Act, all applicable Blue Sky Laws and any other applicable state, local or foreign law has been taken; provided, however, that if the Investor provides such an opinion reasonably satisfactory in form and substance to the Company, the Company will bear the reasonable expense thereof.

 

(d)                                  The Investor represents to the Company that: (i) such Investor is able to fend for itself in the Contemplated Transactions; (ii) such Investor has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of such Investor’s prospective investment in the Preferred Shares and has so evaluated the merits and risks of such investment; (iii) such Investor has the ability to bear the economic risks of such Investor’s prospective investment and can afford the complete loss of such investment; (iv) such Investor has had an opportunity to review the SEC Documents, together with the opportunity to obtain such additional information as it requested to verify the accuracy of the information contained therein or otherwise supplied to such Investor

 

10

 

so that such Investor can make an informed investment decision with respect to an investment in the Preferred Shares; (v) such Investor has had access to officers of the Company and an opportunity to ask questions of and receive answers from such officers and has had all questions that have been asked by such Investor satisfactorily answered by the Company; and (vi) such Investor is not subscribing to purchase the Preferred Shares as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or presented at any seminar or meeting, or any solicitation of a subscription by a Person not previously known to such Investor in connection with investments in securities generally.

 

(e)                                   The Investor represents to the Company that: such Investor: (i) was qualified at the time such Investor was offered the Preferred Shares, (ii) qualifies on the date hereof, and (iii) will qualify on the Closing Date, as an “accredited investor” as such term is defined under Rule 501 promulgated under the 1933 Act.

 

(f)                                    By acceptance hereof, the Investor acknowledges that the Preferred Shares, the Underlying Securities and any shares of capital stock of the Company received in respect of the foregoing held by it may not be sold by such Investor without registration under the 1933 Act or an exemption therefrom, and therefore such Investor may be required to hold such securities for an indeterminate period.

 

(g)                                   In connection with any transfer of Securities made by the Investor in compliance with the provisions of this Agreement, such Investor will cause each proposed transferee of such Securities to agree and take hold such Securities subject to the provisions of this Agreement.

 

5.2                                Legends .  All certificates for the Preferred Shares and the Underlying Securities, and each certificate representing any shares of capital stock of the Company or other securities or property received in respect of the foregoing, whether by reason of a stock split or share reclassification thereof, a stock dividend thereon or otherwise, and each certificate for any such securities issued to subsequent transferees of any such certificate (unless otherwise permitted herein) shall bear the following legend, unless such securities have been registered under the 1933 Act:

 

“THE PREFERRED SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AMENDED (THE “1933 ACT”), OR ANY STATE SECURITIES LAWS.  THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF (I) SUCH REGISTRATION OR (II) AN EXEMPTION THEREFROM AND, IF REQUESTED BY THE

 

11

 

COMPANY, AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

6.                                       Additional Covenants of the Company.

 

6.1                                Reports, Information, Securities .

 

(a)                                  The Company shall cooperate with the Investor in supplying such information as may be reasonably requested by such Investor to complete and file any information reporting forms presently or hereafter required by the SEC as a condition to the availability of the safe harbor pursuant to Rule 144 for the sale of any of the Preferred Shares, the Underlying Securities and shares of capital stock of the Company received in respect of the foregoing.

 

(b)                                  The Company shall keep reserved for issuance a sufficient number of authorized but unissued shares of Common Stock (or other securities or property into which the Preferred Shares are then convertible) so that the Preferred Shares may be converted or exercised to purchase Common Stock (or such other securities or property) at any time.

 

6.2                                Expenses; Indemnification .

 

(a)                                  The Company agrees to pay on the Closing Date and save the Investor harmless against liability for (i) the payment of any stamp or similar taxes (including interest and penalties, if any) that may be determined to be payable in respect of the execution and delivery of this Agreement, and the issue and sale of any Preferred Shares and the Underlying Securities, (ii) the expense of preparing and issuing the certificates for the Preferred Shares and the Underlying Securities, and (iii) the cost of delivering the Preferred Shares and the Underlying Securities of the Investor to such Investor’s address, insured in accordance with customary practice.  The Investor shall be responsible for its out-of-pocket expenses arising in connection with the Contemplated Transactions.

 

(b)                                  The Company hereby agrees and acknowledges that the Investor has been induced to enter into this Agreement and to purchase the Preferred Shares hereunder, in part, based upon the representations, warranties, agreements and covenants of the Company contained herein.  The Company hereby agrees to pay, indemnify and hold harmless the Investor (an “ Indemnified Party ”) against all claims, losses and damages resulting from any and all legal or administrative proceedings, including without limitation, reasonable attorneys’ fees and expenses incurred in connection therewith (collectively, “ Losses ”), resulting from a breach by the Company of any representation or warranty of the Company contained herein or the failure of the Company to perform any agreement or covenant made herein;

 

12

 

(c)                                   As soon as reasonably practicable after receipt by any Indemnified Party of notice of any Losses in respect of which the Company (the “ Indemnifying Party ”) may be required to provide indemnification thereof under this Section 6.2, the Indemnified Party shall give written notice thereof to the Indemnifying Party.  The Indemnified Party may, at its option, claim indemnity under this Section 6.2 as soon as a claim has been threatened by a third party, regardless of whether any actual Losses have been suffered, so long as counsel for such Indemnified Party shall in good faith determine that such claim is not frivolous and that the Indemnifying Party may be required to provide indemnification therefor as a result thereof and shall give notice of such determination to the Indemnifying Party.  The Indemnified Party shall permit the Indemnifying Party at the Indemnifying Party’s option and expense, to assume the defense of any such claim by counsel mutually and reasonably satisfactory to the Indemnifying Party and a majority in interest of the Indemnified Parties and to settle or otherwise dispose of the same; provided, however, that the Indemnified Party may at all times participate in such defense at such Indemnified Party’s expense; and provided further, however, that the Indemnifying Party shall not, in defense of any such claim, except with the prior written consent of the Indemnified Party, consent to the entry of any judgment or settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff in question to such Indemnified Party of a release of all liabilities in respect of such claim.  If the Indemnifying Party does not promptly assume the defense of such claim or if any such counsel is unable to represent one or more of the Indemnified Parties due to a conflict of interest, then an Indemnified Party may assume, to the extent separable, the defense of such portion of the claim as to which the conflict arose (and, if not separable, the entire claim) and be entitled to indemnification and prompt reimbursement from the Indemnifying Party for such Indemnified Party’s reasonable costs and expenses incurred in connection therewith, including without limitation, reasonable attorneys’ fees and expenses.  Such fees and expenses shall be reimbursed to the Indemnified Parties as soon as practicable after submission of invoices to the Indemnifying Party.

 

6.3                                Form D and Blue Sky .  The Company agrees to file a Form D with respect to the Preferred Shares as required under Regulation D promulgated under the 1933 Act and to promptly provide a copy thereof to the Investor who requests a copy after such filing by reference to the web site www.sec.gov maintained by the SEC.  The Company, on or before the Closing Date, shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for or to qualify the Preferred Shares for sale to the Investor at Closing pursuant to this Agreement under the applicable securities or “blue sky” laws of the states of the United States (or to obtain an exemption from such qualification), and if requested by the Investor, shall provide evidence of any such action so taken.  The Company shall make such filings and reports relating to the offer and sale of the Preferred Shares, including but not limited to Form D if required in any state, as

 

13

 

required under applicable Blue Sky laws following or on the Closing Date.  The Investor shall not incur any costs or expenses relating to Form D or such filings under applicable Blue Sky laws.

 

6.4                                Listing on Securities Exchanges .  In furtherance and not in limitation of any other provision of this Agreement, during any period of time in which the Company’s Common Stock is listed on any national securities exchange, the Company will, at its expense, exercise its best efforts to simultaneously list on such exchange, upon conversion of the Preferred Shares, and maintain such listing, all Underlying Securities.

 

6.5                                Use of Proceeds .  The Company shall use the proceeds from the offering and sale of Preferred Shares hereunder for general corporate purposes.

 

6.6                                Investor One-Time Put Option .

 

(a)                                  Within five (5) calendar days of receipt by the Company of at least five million dollars ($5,000,000) from the closing of the third tranche (as it exists on the date hereof or as it may be modified from time to time hereafter) under the Investment and Securities Purchase Agreement dated as of April 17, 2015, as amended, between the Company and AMER International Group Co. Ltd. (“ Amer ”), the Company shall provide written notice (a “ Funding Notice ”) to the Investor of the receipt of such funds.  The Company shall retain $500,000 of the funds received from AMER until the date that is sixty (60) days after the date of the Funding Notice.

 

(b)                                  Upon receipt of the Funding Notice, the Investor shall have the one-time right (but not the obligation) to require the Company to redeem all or any portion of its Preferred Shares by sending a written notice (a “ Put Notice ”) to the Company.  The Put Notice, if any, must be provided no less than five (5) days and no more than sixty (60) days from the date of the Funding Notice and must specify the number of Preferred Shares that the Investor elects to have redeemed.

 

(c)                                   Upon timely receipt of the Put Notice, the Company shall be obligated to redeem the number of Preferred Shares specified by the Investor, which redemption shall occur within five (5) business days thereafter.  The redemption price in connection with such redemption shall be (i) $100.00 per Preferred Share, plus (ii) any accrued and unpaid dividends on the Preferred Shares to the date of redemption, plus (iii) an amount equal to an additional six (6) months of dividends on the Preferred Shares.

 

7.                                       Miscellaneous.

 

7.1                                Entire Agreement; Successors and Assigns .  This Agreement and the other Transaction Documents constitute the entire contract between the parties relative to the subject matter hereof and thereof, and no party shall be liable or bound to the other in any manner by any warranties or representations (express or implied)

 

14

 

or agreements or covenants except as specifically set forth herein or therein.  This Agreement and the other Transaction Documents supersede any previous agreement among the parties with respect to the subject matter hereof and thereof.  The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective executors, administrators, heirs, successors and assigns of the parties.  Nothing in this Agreement, expressed or implied, is intended to confer upon any party, other than the parties hereto, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

 

7.2                                Survival of Representations and Warranties .  Notwithstanding any right of the Investor fully to investigate the affairs of the Company and notwithstanding any knowledge of facts determined or determinable by the Investor pursuant to such right of investigation, the Investor has the right to rely fully upon the representations, warranties, covenants and agreements of the Company contained in this Agreement or in any documents delivered pursuant to this Agreement.  All such representations and warranties of the Company contained in this Agreement shall survive the execution and delivery of this Agreement and the Closing hereunder and shall continue in full force and effect until the earlier of (a) the date that is one year after the Closing and (b) the sale of all of the Underlying Securities pursuant to Rule 144 under the 1933 Act or an effective registration statement under the 1933 Act covering the Underlying Securities.  All representations and warranties of the Investor contained in this Agreement shall survive the execution and delivery of this Agreement and the Closing hereunder and shall continue in full force and effect until the date that is one year after the Closing.  The covenants of the Investor and the Company set forth in this Agreement shall survive the Closing.

 

7.3                                Governing Law; Waiver of Jury Trial .  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to its conflict of laws principles.  The parties hereto hereby agree to be subject to the exclusive personal jurisdiction in the federal and state courts of the State of Colorado or the State of Delaware and any award which may be enforced in regard to this Agreement may be enforced in such federal and state courts of the State of Colorado or the State of Delaware.  Each of the parties hereto hereby agrees to irrevocably and unconditionally waive trial by jury in any judicial proceeding between or among the parties arising out of or related to the Contemplated Transactions.

 

7.4                                Counterparts .  This Agreement may be executed (including by facsimile transmission) with counterpart signature pages or in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

7.5                                Headings .  The headings of the sections of this Agreement are for convenience and shall not by themselves determine the interpretation of this Agreement.

 

15

 

7.6                                Notices .  Any notice required or permitted to be given under this Agreement by any party shall be sufficiently given if delivered either (a) by electronic mail at such party’s electronic email address set forth below, or (b) by nationally recognized overnight express company, at such party’s physical address set forth below.  All such notices and other communications shall, when mailed by means of any nationally recognized overnight express company, be effective when delivered to the notice address (as evidenced by any signature for delivery at the notice address), or, if sent by electronic mail during the recipient’s normal business hours, when such notice is sent, and if such notice is sent by electronic mail after the recipient’s normal business hours, then on the next day.  Either party hereto may change its address specified for notices herein by designating a new address by notice in accordance with this Section 7.6.

 

7.7                                Rights of Transferees .  Any and all rights and obligations of the Investor herein incident to the ownership of Securities or the Underlying Securities shall pass successively to all subsequent transferees of such securities until extinguished pursuant to the terms hereof; provided, however, that the Investor may not transfer or assign its rights under this Agreement (other than to an Affiliate) between the date of this Agreement and the Closing Date.

 

7.8                                Severability .  Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be deemed prohibited or invalid under such applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, and such prohibition or invalidity shall not invalidate the remainder of such provision or any other provision of this Agreement.

 

7.9                                Fees and Expenses .  Each party hereto shall pay its own (and its Affiliates’) legal, accounting and other fees, costs and expenses in connection with the Contemplated Transactions, including the fees, costs and expenses of their respective advisors or other representatives in connection with consultation or communication with or other assistance to the other party or its advisors or representatives.

 

7.10                         Amendments and Waivers .  Unless a particular provision or section of this Agreement requires otherwise explicitly in a particular instance, any provision of this Agreement may be amended and the observance of any provision of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Investor.  Any amendment or waiver effected in accordance with this Section 7.10 shall be binding upon the Investor, each holder of any Securities at the time outstanding (including without limitation securities into which any such Securities are convertible or exercisable), each future holder thereof, and the Company.

 

7.11                         Construction .  Words (including capitalized terms defined herein) in the singular shall be held to include the plural and vice versa as the context requires.  The words “herein,” “hereinafter,” “hereunder” and words of similar import used in

 

16

 

this Agreement shall, unless otherwise stated, refer to this Agreement as a whole and not to any particular provision of this Agreement.  The words “or” and “any” are not exclusive.  All references to “$” in this Agreement and the other agreements contemplated hereby shall refer to United States dollars (unless otherwise specified expressly).  Any reference to any gender includes the other genders.

 

[Remainder of page intentionally left blank; signature page attached.]

 

17

 

IN WITNESS WHEREOF, the undersigned has executed this Agreement as of the date first above written.

 

Amount of Subscription:

MOUNT HOPE MINES, INC.

$

500,000

 

 

 

Number of Preferred Shares to be Purchased:

By:

/s/ Stephen Drimmer

 

5,000

Name:

Stephen Drimmer

 

Title:

President

 

 

 

 

 

Address and Fax Number

 

 

 

 

 

E-mail Address

 

 

 

 

 

Taxpayer Identification Number

 

 

 

Colorado — October 6, 2004

 

Date and State of Incorporation

 

 

 

December 31

 

Date on which Taxable Year Ends

 

Accepted and Agreed to as of the date first above written:

 

GENERAL MOLY, INC.

Address for notices:

 

1726 Cole Blvd., Suite 115

 

Lakewood, CO 80401

By:

/s/ R. Scott Roswell

 

Attention: R. Scott Roswell

 

 

 

Telephone: (303) 928-8599

Name:

/s/ R. Scott Roswell

 

Email: sroswell@generalmoly.com

 

 

 

 

Title:

Chief Legal Officer

 

with a copy to:

 

 

 

Bryan Cave Leighton Paisner LLP

Date:

May 2, 2019

 

1700 Lincoln Street, Suite 4100

 

Denver, CO 80203

 

Attention: Charles D. Maguire, Jr.

 

Telephone: (303) 866-0550

 

Email: charles.maguire@bclplaw.com

 

[Signature Page to Securities Purchase Agreement]

 

 

Exhibit A

 

[Intentionally omitted]

 

 

Exhibit B

 

Form of Certificate of Designations

 

See attached.

 

 

Exhibit C

 

Accredited Investor Questionnaire

 

To ensure that the Preferred Shares are sold pursuant to an appropriate exemption from registration under applicable Federal and State securities laws, the Investor is furnishing certain additional information by checking each boxes below preceding any statement below that is applicable to the Investor.  The Investor certifies that the information contained in each of the following checked statements (to be checked by the investor only if applicable) is true and correct and hereby agrees to notify the Company of any changes that may occur in such information prior to the Company’s acceptance of any subscription.

 

1.                                       o                                     The Investor is a natural person whose individual net worth or joint net worth with his or her spouse as of the date hereof is in excess of $1,000,000. For purposes of this item 1, “net worth” means the excess of total assets at fair market value (including personal and real property, but excluding the estimated fair market value of a person’s primary home) over total liabilities. Total liabilities excludes any mortgage on the primary home in an amount of up to the home’s estimated fair market value as long as the mortgage was incurred more than 60 days before the Preferred Shares are purchased, but includes (i) any mortgage amount in excess of the home’s fair market value and (ii) any mortgage amount that was borrowed during the 60-day period before the closing date for the sale of Securities for the purpose of investing in the Preferred Shares.

 

2.                                       o                                     The Investor is a natural person who had an individual income in excess of $200,000 in each of the two most recently completed years or joint income with his or her spouse in excess of $300,000 in each of those years and has reasonable expectation of reaching the same income level in the current year.

 

3.                                       o                                     The Investor is a director or an executive officer of the Company.

 

4.                                       o                                     The Investor is an organization described in section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership not formed for the specific purpose of investing in the Preferred Shares, with total assets in excess of $5,000,000.

 

5.                                       o                                     The Investor is a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Preferred Shares, and the investment in the Preferred Shares is being directed by a sophisticated person, which, for purposes of this representation, means a person who has such knowledge and experience in financial and business matters that the person is capable of evaluating the merits and risks of the prospective investment in the Preferred Shares

 

 

6.                                       o                                     The Investor is an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”), and either the decision to invest in the Preferred Shares has been made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company or registered investment advisor, or the employee benefit plan has total assets in excess of $5,000,000, or if a self-directed plan, investment decisions are made solely by persons who are accredited investors.

 

7.                                       o                                     The Investor is a private business development company as defined in Section 202 (a)(22) of the Investment Advisers Act of 1940.

 

8.                                       o                                     The Investor is a bank, as defined in Section 3(a)(2) of the Act, or a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity.

 

9.                                       o                                     The Investor is a broker or dealer registered pursuant to Section 15 of the Preferred Shares Exchange Act of 1934, as amended.

 

10.                                o                                     The Investor is an insurance company as defined in Section 2(13) of the Act.

 

11.                                o                                     The Investor is an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act.

 

12.                                o                                     The Investor is a Small Business Investment Company licensed by the U. S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958.

 

13.                                o                                     The Investor is a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000.

 

14.                                o                                     The Investor is an entity in which each of the equity owners is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Act.   If you checked this Item 14, please complete the following part of this question:

 

(1) List all equity owners:

 

(2) What is the type of entity?

 

Exhibit 99.1

 

 

General Moly Reports Final Protests to
Mt. Hope Project’s Water Applications Withdrawn

 

LAKEWOOD, COLORADO — May 23, 2019, General Moly, Inc. (the “Company” or “General Moly”) (NYSE AMERICAN and TSX: GMO), the only western-exchange listed, pure-play molybdenum (“moly”) development company, announced that the  Kobeh Valley, Nevada ranching family’s (“Ranchers”) protests to the Mt. Hope Project’s water rights applications pending before the Nevada State Engineer have been formally withdrawn in exchange for the funding of the initial $1 million payment to a trust account. The release of funds to the Ranchers is pending issuance of the water permits from the Nevada State Engineer.

 

With the withdrawal of protests, the Ranchers have also forfeited any right to judicial review of any decision by the Nevada State Engineer concerning the water rights applications and permits, and the Ranchers agree not to oppose any other proceedings with any state or federal agency related to the Mt. Hope Project.

 

At such time that the Mt. Hope joint venture partners at Eureka Moly, LLC (“EMLLC”) secure project financing, additional consideration representing less than 1.5 % of the estimated remaining project capital budget will be payable to the Ranchers. If EMLLC has not secured Mt. Hope Project financing within 12 months of the April 30, 2019 executed settlement agreement, EMLLC will make monthly payments of $10,000 to the Ranchers until financing is achieved and the remaining consideration will be paid to the Ranchers. EMLLC, which operates the Mt. Hope Project, is owned 80% by General Moly and 20% by POS-Minerals Corporation, a subsidiary of POSCO of South Korea.

 

The Company is working cooperatively with the Nevada State Engineer for the anticipated approval of the water applications and issuance of water permits for the development and operation of the Mt. Hope Project.

 

*****

 

About General Moly

 

General Moly is a U.S.-based, molybdenum mineral exploration and development company listed on the NYSE American, recently known as the NYSE MKT and former American Stock Exchange, and the Toronto Stock Exchange under the symbol GMO. The Company’s primary asset, an 80% interest in the Mt. Hope Project located in central Nevada, is considered one of the world’s largest and highest grade molybdenum deposits. Combined with the Company’s wholly-owned Liberty Project, a molybdenum and copper property also located in central Nevada, General Moly’s goal is to become the largest primary molybdenum producer in the world.

 

Molybdenum is a metallic element used primarily as an alloy agent in steel manufacturing.  When added to steel, molybdenum enhances steel strength, resistance to corrosion and extreme temperature performance. In the chemical and petrochemical industries, molybdenum is used in catalysts, especially for cleaner burning fuels by removing sulfur from liquid fuels, and in corrosion inhibitors, high performance lubricants and polymers.

 

Contact:

 

Scott Roswell

(303) 928-8591

info@generalmoly.com

 

Website: www.generalmoly.com

 

Forward-Looking Statements

 

Statements herein that are not historical facts are “ forward-looking statements” within the meaning of Section 27A of the Securities Act, as amended and Section 21E of the Securities Exchange Act of 1934, as amended and are intended to be

 

1

 

covered by the safe harbor created by such sections.  Such forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, expected, or implied by the Company.  These risks and uncertainties include, but are not limited to availability of cash to continue ongoing operations and repay outstanding debt, including the ability to secure any loans or other financing to fund the costs of the Mt. Hope Project, metals price and production volatility, global economic conditions, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, exploration risks and results, political, operational and project development risks, including the Company’s ability to obtain a re-grant of its water permits and Record of Decision , ability to maintain required federal and state permits to continue construction, and commence production of molybdenum, copper, silver, lead or zinc, ability to identify any economic mineral reserves of copper, silver, lead or zinc; ability of the Company to obtain approval of its joint venture partner at the Mt. Hope Project in order to mine for copper, silver, lead or zinc, ability to raise required project financing or funding to pursue an exploration program related to potential copper, silver lead or zinc deposits at Mt. Hope, ability to respond to adverse governmental regulation and judicial outcomes, and ability to maintain and /or adjust estimates related to cost of production, capital, operating and exploration expenditures.  For a detailed discussion of risks and other factors that may impact these forward looking statements, please refer to the Risk Factors and other discussion contained in the Company’s quarterly and annual periodic reports on Forms 10-Q and 10-K, on file with the SEC.  The Company undertakes no obligation to update forward-looking statements.

 

2