General Moly Inc. and its largest shareholder, AMER International Group, agreed to amend a previously announced investment agreement, which would give the company more funding to support its business activities and working capital.
The parties will accelerate a US$6 million private placement comprising 14.6 million General Moly shares at 41 cents apiece and eliminate the previous conditions to the closing of this tranche requiring the restoration of permits for the Nevada-based Mount Hope molybdenum project's water rights and for the molybdenum price to average more than US$8 per pound for a 30-consecutive calendar day period.
In addition, General Moly and AMER agreed to accelerate the closing of a US$10 million placement of company shares at 50 cents each in 2018. The closing conditions for this tranche concerning a final adjudication of Mount Hope's water rights through courts or settlement, and for the molybdenum price to average in excess of US$12 per pound for a 30-consecutive calendar day period, will also be eliminated.
General Moly noted in an Aug. 8 release that the third tranche may be subject to shareholder approval.
Through this amended agreement, AMER reinforces its commitment to work with General Moly to secure a US$700 million loan for the development of the project.
After drawdown of the loan, if AMER owns more than 30% of General Moly's stock, it will nominate a third director to the company's board.