General Moly Amends Agreement with AMER International

General Moly Inc. (TSX:GMO,NYSEMKT:GMO) announced an agreement that amends its previous investment and securities purchase agreement with China’s AMER International Group.
Read our overview of the original deal here.
Highlights of the new agreement include:

• Tranche 1 of the amended Investment Agreement is a private placement for $4 million worth of General Moly common shares, priced at $0.30. The allocation of this $4 million private placement will be divided evenly between general corporate purposes and an expense reimbursement account relating to Mt. Hope financing costs and other jointly sourced business development opportunities. In addition, AMER andGeneral Moly will enter into a Stockholder Agreement allowing AMER to nominate a director to a then seven member General Moly Board of Directors, and additional directors following the close of Tranche 3 and drawdown of a senior secured loan (“Bank Loan”), respectively. The Stockholders Agreement also relates to AMER’s acquisition and transfer of General Moly shares.
• AMER and General Moly will enter into a Warrant Agreement which provides that when drawdown of the approximately $700 million Bank Loan becomes available and documentation is complete, 80 million warrants to purchase common shares of General Moly vest and become exercisable by AMER at a price of$0.50. All conditions to complete the warrants transaction must be completed no later than April 17, 2017.
• Tranche 2 of the amended Investment Agreement will include a private placement for $6 million ofGeneral Moly common shares, priced at $0.50. The allocation of this $6 million private placement will be divided with $5 million reserved for general corporate purposes and additional $1 million set aside for the expense reimbursement account, discussed above. Closing of Tranche 2 is contingent on the Nevada State Engineer restoring permits for the Mt. Hope Project’s water rights and for the price of molybdenum to average in excess of $8/lb for a 30 consecutive calendar day period.
• Tranche 3 of the agreement will include a private placement for $10 million of General Moly common shares, priced at $0.68. Execution of Tranche 3 is contingent on a final adjudication of the Mt. Hope Project’s water rights through courts or settlement, if further protests and appeals result from the issuance of the water permits, and for the price of molybdenum to average in excess of $12/lb for a 30 consecutive calendar day period. After Tranche 3 of the agreement is executed, AMER will nominate a second Director to General Moly’s then eight member Board of Directors.
• The parties agreed to eliminate the condition to closing the Investment Agreement concerning the requirement to obtain a letter of intent from a Prime Chinese Bank endorsing the Bank Loan, discussed below, as a result of the current molybdenum market price and recent water rights decision from theNevada Supreme Court, and eliminate the requirement of the Company to obtain consent from Aperam, as Tranche 1 is being issued at $0.30, which is above the October 30, 2015 closing price of $0.29.

Bruce D. Hansen, CEO of General Moly, commented:

The agreement to amend the Investment Agreement and the funding of Tranche 1 of our partnership with AMER, one of the world’s largest advanced materials, downstream metals refining, and fabrication companies, is an important milestone for the Company and a critical component of our future success.
Although the amended Investment Agreement contains in aggregate the same number of shares at the same price as the initial agreement, it was restructured to reflect current realities including what we believe to be the unsustainably low price of molybdenum as well as the recirculation of the water rights issue.

Click here to read the full General Moly Inc. (TSX:GMO,NYSEMKT:GMO) press release.