Progress Toward Full Financing At Mt. Hope

LAKEWOOD, CO - Bruce D. Hansen, Chief Executive Officer of General Moly said, “The recent agreement with POS-Minerals and our private placement financing provides the Company with a significantly improved project and corporate liquidity profile as we bridge to project financing for Mt. Hope.”
Hansen continued, “We remain confident in the progress being made toward full Mt. Hope Project financing. Negotiations on investment agreement terms, sponsorship requirements, and indicative loan terms associated with a $700 to $750 million debt and equity package, are continuing to advance, with strong interest from a private Chinese industrial company and a large Chinese bank in advancing the fully permitted, construction-ready project. The Company is also continuing to explore other potential strategic options.”
“Looking into 2015 and beyond, our improved liquidity position substantially enhances the Company’s ability to support the Mt. Hope Project, including maintaining our permits and other care and maintenance needs while preserving the ability to rapidly restart construction activities when full financing is achieved. In addition, the Company will continue to prudently manage its liquidity position, and expects non-Mt. Hope Project related spending of approximately $2.5 million per quarter, and will examine spending on an ongoing basis. We are continuing to progress toward our goal of becoming the largest pure play primary molybdenum producer in the world,” Hansen said.
In December 2012, the Company and POS-Minerals, as the members of EMLLC, agreed to hold, as restricted cash, $36 million due to the Company, of the approximately $100 million received from POS-Minerals’ December 2012 capital contributions. These funds were to be held in a reserve account until the Company arranged full project financing for its 80% share of Mt. Hope Project construction cost, or until the EMLLC management committee agreed to release the funds.
On January 21, 2015, General Moly announced an agreement with POS-Minerals to use the $36 million restricted cash for the benefit of the Mt. Hope Project. The Company, through its wholly owned subsidiary, Nevada Moly, LLC and POS-Minerals, as the members of EMLLC, will, until exhausted or the Company’s full financing for construction of the Mt. Hope Mine is achieved, use the restricted cash to fund the Mt. Hope Project’s financial requirements. Any restricted cash balance remaining at the time of financing will be returned to the Company.
With the jointly developed revised long-term budget to maintain the Mt. Hope Project in its permitted, construction ready status the EMLLC members agreed that the budget will be entirely funded by the reserve account, until at least through 2020, covering anticipated operating expenses, and committed equipment purchase obligations unless the Company’s full financing is obtained.