General Moly and Hanlong terminate $125 million subordinated loan

By Tali David

Minneapolis, May 16 - General Moly, Inc. and Hanlong (USA) Mining Investment, Inc. mutually agreed to terminate the $125 million subordinated loan agreement dated as of Oct. 26, 2012, according to an 8-K filed with the Securities and Exchange Commission.

The agreement was intended to supplement a $665 million Chinese sourced term loan for the financing of the Mt. Hope Project.

The subordinated loan agreement, which would have become available upon receipt of the Chinese sourced term loan, was terminated to provide General Moly with greater flexibility in securing an additional Chinese strategic partner, the filing said.

The termination of the subordinated loan agreement also cancels the arrangement fee of $6.25 million payable to Hanlong upon closing of a Chinese sourced term loan.

In connection with the termination, the common stock purchase warrant with a 2.5-year maturity to purchase ten million shares of the company's common stock at a strike price of $4.23 per share, issued to Hanlong on Oct. 26, 2012, was terminated.

General Moly is a Lakewood, Colo.-based molybdenum mineral development, exploration and mining company. Hanlong Mining is a wholly owned subsidiary of Sichuan Hanlong Group, a privately held Chinese company with a wide portfolio of investments.

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