Item 3.02
Unregistered Sales of Equity Securities.
On August 5, 2019, General Moly, Inc. (the Company) executed a Securities Purchase Agreement (the Purchase Agreement) with Bruce D. Hansen, the Companys Chief Executive Officer, and Robert I. Pennington, the Companys Chief Operating Officer (collectively the Investors). Pursuant to the Purchase Agreement, the Investors have agreed to purchase up to $400,000 of convertible shares of Series B Preferred Stock, par value $0.001 per share (the Series B Preferred Stock), of the Company.
The Series B Preferred Stock is being issued at a price of $100.00 per share, and each share of the Series B Preferred Stock will be convertible at any time at the holders discretion into 500 shares of common stock of the Company. The Series B Preferred Stock carries a 5% annual dividend, which may be paid, in the Companys sole discretion, in cash, additional shares of Series B Preferred Stock or a combination thereof. The Series B Preferred Stock will vote together with the Companys common stock as a single class on an as-converted basis. The Series B Preferred Stock is mandatorily redeemable at such time that the Companys 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 August 5, 2019, the Company notified the Investors that the closing date under the Purchase Agreement will be August 7, 2019. The closing will be in the amount of $400,000 of Preferred Stock, or 4,000 shares, as follows:
Investor Name
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Number of Shares of Series B Preferred Stock
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Bruce D. Hansen
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3600
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Robert I. Pennington
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400
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The offer, issuance and sale of the Series B 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 Companys policies for approving related party transactions, this transaction was approved by the Audit Committee of the Companys Board of Directors, as well as the disinterested members of the full Board of Directors.
The foregoing description of the 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 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.
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