Exhibit 10.1

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered into
as of October 22, 2010 by and among GOLDEN MINERALS COMPANY, a Delaware
corporation (the “Company”), and SENTIENT GLOBAL RESOURCES FUND III, L.P., a
Cayman Islands exempted limited partnership, and SGRF III PARALLEL I, L.P., a
Cayman Islands exempted limited partnership (the “Buyers”).

 

RECITALS

 

A.            In connection with the Subscription Agreement by and between the
Company and Buyers dated October 22, 2010 (the “Subscription Agreement”), the
Company has agreed, upon the terms and subject to the conditions of the
Subscription Agreement, to issue and sell to Buyers and Buyers have agreed to
purchase, shares of the Company’s authorized but unissued Common Stock (the
“Shares”).

 

B.            To induce Buyers to execute and deliver the Subscription
Agreement, the Company has agreed to provide certain registration rights under
the U.S. Securities Act of 1933, as amended, and the rules and regulations
thereunder, and applicable state securities laws.

 

NOW, THEREFORE, in consideration of the recitals and the mutual promises,
representations, warranties, and covenants set forth in this Agreement and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

 

AGREEMENT

 

SECTION 1.         Definitions.

 

In addition to the terms that are defined elsewhere in this Agreement, the
following terms shall have the following meanings:

 

“Affiliate” with respect to any specified person, has the meaning specified in
Rule 144.

 

“Common Stock” means the Company’s common stock, par value $0.01 per share.

 

“Deferral Notice” has the meaning specified in Section 3(d) hereof.

 

“Deferral Period” has the meaning specified in Section 3(d) hereof.

 

“Effectiveness Deadline Date” has the meaning specified in Section 2(a) hereof.

 

“Effectiveness Period” means the period commencing on the date the Registration
Statement becomes effective and ending on the date that all Registrable
Securities have ceased to be Registrable Securities.

 

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“Exchange Act” means the United States Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.

 

“Filing Deadline Date” has the meaning specified in Section 2(a) hereof.

 

“Holder” means Buyers, any transferee or assignee thereof to whom Buyers assign
their rights under this Agreement and who agrees to become bound by the
provisions of this Agreement in accordance with Section 8(a) and any transferee
or assignee thereof to whom a transferee or assignee assigns its rights under
this Agreement and who agrees to become bound by the provisions of this
Agreement in accordance with Section 8(a).

 

“Initial Resale Registration Statement” has the meaning specified in
Section 2(a) hereof.

 

“Material Event” has the meaning specified in Section 3(d) hereof.

 

“Notice and Questionnaire” means a written notice delivered to the Company
containing substantially the information called for by the Selling
Securityholder Notice and Questionnaire attached as Annex A to this Agreement.

 

“Notice Holder” means on any date, any Holder that has delivered a Notice and
Questionnaire to the Company on or prior to such date.

 

“Prospectus” means the prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 415 promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all materials incorporated by reference or
explicitly deemed to be incorporated by reference in such Prospectus.

 

“Registrable Securities” means the Shares issued to Buyers under the
Subscription Agreement (including the Initial Shares and the Subsequent Shares,
as such terms are defined in the Subscription Agreement) and any security issued
with respect thereto upon any stock dividend, split, merger or similar event
until, in the case of any such security, the earlier of (i) the sale of such
security pursuant to Rule 144 under the Securities Act or pursuant to an
effective registration statement registering such security for resale, or
(ii) the first date on which the Registrable Securities may be sold pursuant to
Rule 144 without being subject to the volume restrictions set forth in
Rule 144(e).

 

“Registration Statement” means any registration statement of the Company that
covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits, and
all materials incorporated by reference or explicitly deemed to be incorporated
by reference in such registration statement.

 

“Resale Registration Statement” means the Initial Resale Registration Statement
and any Subsequent Resale Registration Statements.

 

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“Rule 144” means Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or any similar or successor rule or regulation hereafter
adopted by the SEC having substantially the same effect as such Rule.

 

“SEC” means the United States Securities and Exchange Commission and any
successor agency.

 

“Securities Act” means the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated by the SEC thereunder.

 

“Shares” has the meaning set forth in the Recitals.

 

“Subscription Agreement” has the meaning set forth in the Recitals.

 

“Subsequent Resale Registration Statement” has the meaning specified in
Section 2(b) hereof.

 

SECTION 2.         Resale Registration.

 

(a)           The Company shall prepare and file or cause to be prepared and
filed with the SEC no later than March 31, 2011 (the “Filing Deadline Date”) a
Registration Statement (the “Initial Resale Registration Statement”) registering
the resale from time to time by Buyers of all of the Registrable Securities. The
Initial Resale Registration Statement shall be on Form S-3 or another
appropriate form permitting registration of such Registrable Securities for
resale by Buyers in accordance with the methods of distribution set forth in the
Initial Resale Registration Statement. The Company shall use its commercially
reasonable efforts to promptly respond to comments from the SEC regarding the
Initial Resale Registration Statement, to cause the Initial Resale Registration
Statement to be declared effective under the Securities Act no later than
June 30, 2011 (the “Effectiveness Deadline Date”), and to keep the Initial
Resale Registration Statement (or any Subsequent Resale Registration Statement)
continuously effective under the Securities Act until the expiration of the
Effectiveness Period.

 

(b)           If the Initial Resale Registration Statement or any Subsequent
Resale Registration Statement ceases to be effective for any reason at any time
during the Effectiveness Period, the Company shall use its commercially
reasonable efforts to obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event shall within thirty (30) days of such
cessation of effectiveness amend the Resale Registration Statement in a manner
reasonably expected by the Company to obtain the withdrawal of the order
suspending the effectiveness thereof, or file an additional Resale Registration
Statement covering all of the securities that as of the date of such filing are
Registrable Securities (a “Subsequent Resale Registration Statement”). If a
Subsequent Resale Registration Statement is filed, the Company shall use
commercially reasonable efforts to cause the Subsequent Resale Registration
Statement to become effective as promptly as is reasonably practicable after
such filing or, if filed during a Deferral Period, after the expiration of such
Deferral Period, and to keep such Registration

 

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Statement (or Subsequent Resale Registration Statement) continuously effective
until the end of the Effectiveness Period.

 

(c)           The Company shall supplement and amend the Initial or any
Subsequent Resale Registration Statement if required by the rules, regulations
or instructions applicable to the registration form used by the Company for such
Resale Registration Statement, if required by the Securities Act.

 

(d)           Each Holder of Registrable Securities agrees that if such Holder
wishes to sell Registrable Securities pursuant to a Resale Registration
Statement and related Prospectus, it will do so only in accordance with this
Section 2(d), Section 3(d) and Section 4. Each Holder of Registrable Securities
wishing to sell Registrable Securities pursuant to any Resale Registration
Statement and related Prospectus agrees to deliver a Notice and Questionnaire to
the Company promptly upon becoming a Holder and notify the Company of any change
in such information at least five (5) business days prior to the filing of the
Initial Resale Registration Statement or Subsequent Resale Registration
Statement, as applicable. From and after the date the Initial Resale
Registration Statement is declared effective, the Company shall, as promptly as
is reasonably practicable after the date a fully completed and legible Notice
and Questionnaire is received by the Company, (i) if required by applicable law,
file with the SEC a post-effective amendment to the Resale Registration
Statement or prepare and, if required by applicable law, file a supplement to
the related Prospectus or a supplement or amendment to any document incorporated
therein by reference or file any other document required by the SEC so that the
Holder delivering such Notice and Questionnaire is named as a selling security
holder in the Resale Registration Statement and the related Prospectus in such a
manner as to permit such Holder to deliver such Prospectus to purchasers of the
Registrable Securities in accordance with applicable law (other than laws not
generally applicable to all Holders of Registrable Securities wishing to sell
Registrable Securities pursuant to the Resale Registration Statement and related
Prospectus) and using the manner of sale specified in the Notice and
Questionnaire, and, if the Company shall file a post-effective amendment to the
Resale Registration Statement, use commercially reasonable efforts to cause such
post-effective amendment to be declared effective under the Securities Act as
promptly as is reasonably practicable; (ii) provide such Holder copies of any
documents filed pursuant to Section 2(d)(i); and (iii) notify such Holder as
promptly as is reasonably practicable after the effectiveness under the
Securities Act of any post-effective amendment filed pursuant to
Section 2(d)(i); provided, that if such Notice and Questionnaire is delivered
during a Deferral Period, the Company shall so inform the Holder delivering such
Notice and Questionnaire and shall take the actions set forth in clauses (i),
(ii) and (iii) above upon expiration of the Deferral Period in accordance with
Section 3(d), provided, further, that if under applicable law the Company has
more than one option as to the type or manner of making any such filing, the
Company will make the required filing or filings in the manner or of a type that
is reasonably expected to result in the earliest availability of the Prospectus
for effecting resales of Registrable Securities. Notwithstanding anything
contained herein to the contrary,

 

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the Company shall be under no obligation to name any Holder that is not a Notice
Holder as a selling security holder in any Registration Statement or related
Prospectus; provided, however, that any Holder that becomes a Notice Holder
pursuant to the provisions of this Section 2(d) of this Agreement (whether or
not such Holder was a Notice Holder at the time the Registration Statement was
initially declared effective) shall be named as a selling security holder in the
Registration Statement or related Prospectus subject to and in accordance with
the requirements of this Section 2(d).

 

(e)           If a Registration Statement covering all the Registrable
Securities required to be covered thereby and required to be filed by the
Company pursuant to this Agreement is (A) not filed with the SEC on or before
the Filing Deadline Date (a “Filing Failure”) or (B) not declared effective by
the SEC on or before the Effectiveness Deadline Date (an “Effectiveness
Failure”), then, as liquidated damages to Buyers by reason of any such delay in
or reduction of its ability to sell the Shares (which remedy shall be the
exclusive remedy for any Filing Failure or Effectiveness Failure (each, a
“Failure”)), the Company shall pay to Buyers an amount equal to 1.0% of the
aggregate purchase price paid by Buyers for the Shares for every thirty (30)
days following the Filing Deadline Date that the Registration Statement is not
filed (in the case of a Filing Failure) and for every thirty (30) days following
the Effectiveness Deadline Date that the Registration Statement is not effective
(in the case of an Effectiveness Failure), as the case may be, on a per diem
basis (the “Liquidated Damages”); provided, however, that the maximum Liquidated
Damages payable to Buyers under this Section 2(e) shall not exceed 3.0% of the
aggregate purchase price of the Shares.  Liquidated Damages, if any, shall be
paid by the Company within ten (10) days following the end of each thirty (30)
day period (or shorter period, if applicable) for which Liquidated Damages are
payable.  The Company shall pay interest on Liquidated Damages not paid when due
at a rate of interest equal to fifteen percent (15.0%) per annum.  In the event
a Registration Statement is filed but is withdrawn by the Company prior to being
declared effective by the SEC, then such Registration Statement will be deemed
to have not been filed for the purpose of this Section 2(e).

 

SECTION 3.         Registration Procedures.

 

In connection with the registration obligations of the Company under Section 2
hereof, the Company shall:

 

(a)           Prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the applicable period
specified in Section 2(a); cause the related Prospectus to be supplemented by
any required Prospectus supplement, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) under the Securities Act;
and use commercially reasonable efforts to comply with the provisions of the
Securities Act applicable to it with respect to the disposition of all
securities covered by such Registration

 

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Statement during the Effectiveness Period in accordance with the intended
methods of disposition by the sellers thereof set forth in such Registration
Statement as so amended or such Prospectus as so supplemented.

 

(b)           Submit to the SEC, within two (2) Business Days after the Company
learns that no review of a particular Registration Statement will be made by the
staff of the SEC or that the staff has no further comments on a particular
Registration Statement, as the case may be, a request for acceleration of
effectiveness of such Registration Statement to a time and date not later than
48 hours after the submission of such request.

 

(c)           Use commercially reasonable efforts to obtain the withdrawal of
any order suspending the effectiveness of a Registration Statement or the
lifting of any suspension of the qualification (or exemption from qualification)
of any of the Registrable Securities for sale in any jurisdiction in which they
have been qualified for sale, in either case at the earliest possible moment or,
if any such order or suspension is made effective during any Deferral Period, at
the earliest possible moment after the expiration of such Deferral Period.

 

(d)           Upon (A) the issuance by the SEC of a stop order suspending the
effectiveness of the Resale Registration Statement or the initiation of
proceedings with respect to the Resale Registration Statement under
Section 8(d) or 8(e) of the Securities Act, (B) the occurrence of any event or
the existence of any fact (a “Material Event”) as a result of which any
Registration Statement shall contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or any Prospectus shall contain any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading (including, in any such case, as a result of the
non-availability of financial statements), or (C) the occurrence or existence of
any development, event, fact, situation or circumstance relating to the Company
that, in the discretion of the Company, makes it appropriate to suspend the
availability of the Resale Registration Statement and the related Prospectus,
(i) in the case of clause (B) above, subject to the next sentence, as promptly
as is reasonably practicable prepare and file a post-effective amendment to such
Registration Statement or a supplement to the related Prospectus or any document
incorporated therein by reference or file any other required document that would
be incorporated by reference into such Registration Statement and Prospectus so
that such Registration Statement does not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and such Prospectus
does not contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, as thereafter
delivered to the purchasers of the Registrable Securities being sold thereunder,
and, in the case of a post-effective amendment to a Registration Statement,
subject to the next sentence, use commercially reasonable efforts to cause it to
be

 

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declared effective as promptly as is reasonably practicable, and (ii) give
notice (via facsimile, telephone or electronic mail followed by a written notice
by internationally recognized overnight courier) to the Notice Holders that the
availability of the Resale Registration Statement is suspended (a “Deferral
Notice”) and, upon receipt of any Deferral Notice, each Notice Holder agrees not
to sell any Registrable Securities pursuant to the Registration Statement until
such Notice Holder’s receipt of copies of the supplemented or amended Prospectus
provided for in clause (i) above, or until it is advised in writing by the
Company that the Prospectus may be used, and has received copies of any
additional or supplemental filings that are incorporated or deemed incorporated
by reference in such Prospectus. The Company will use commercially reasonable
efforts to ensure that the use of the Prospectus may be resumed (x) in the case
of clause (A) above, as promptly as is reasonably practicable, (y) in the case
of clause (B) above, as soon as, in the sole reasonable judgment of the Company,
public disclosure of such Material Event would not be prejudicial to or contrary
to the interests of the Company or, if necessary to avoid unreasonable burden or
expense, as soon as reasonably practicable thereafter and (z) in the case of
clause (C) above, as soon as, in the reasonable discretion of the Company, such
suspension is no longer appropriate. The period during which the availability of
the Registration Statement and any Prospectus is suspended (the “Deferral
Period”) is not to exceed (i) 20 consecutive days at any one time; (ii) 30 days
in the aggregate in any three-month period; or (iii) 60 days in the aggregate
during any 12-month period, or as otherwise required by applicable regulatory
authority; provided that, the number of days the Company is required to keep the
Registration Statement effective shall be extended by the number of days equal
to the aggregate Deferral Period(s). The first day of any Deferral Period must
be at least two (2) trading days after the last day of any prior Deferral
Period.

 

(e)           During the Effectiveness Period (except during such periods that a
Deferral Notice is outstanding and has not been revoked), deliver to each Notice
Holder in connection with any sale of Registrable Securities pursuant to a
Registration Statement, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities and any amendment or
supplement thereto as such Notice Holder may reasonably request; and the Company
hereby consents (except during such periods that a Deferral Notice is
outstanding and has not been revoked) to the use of such Prospectus or each
amendment or supplement thereto by each Notice Holder in connection with any
offering and sale of the Registrable Securities covered by such Prospectus or
any amendment or supplement thereto in the manner set forth therein.

 

(f)            Subject to Section 3(d), prior to any public offering of the
Registrable Securities pursuant to the Resale Registration Statement, use
commercially reasonable efforts to register or qualify or cooperate with the
Notice Holders in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any Notice Holder reasonably requests
in writing (which request may be included in the

 

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Notice and Questionnaire), it being agreed that no such registration or
qualification will be made unless so requested; prior to any public offering of
the Registrable Securities pursuant to the Resale Registration Statement, use
commercially reasonable efforts to keep each such registration or qualification
(or exemption therefrom) effective during the Effectiveness Period in connection
with such Notice Holder’s offer and sale of Registrable Securities pursuant to
such registration or qualification (or exemption therefrom) and do any and all
other acts or things necessary to enable the disposition in such jurisdictions
of such Registrable Securities in the manner set forth in the relevant
Registration Statement and the related Prospectus; provided, that the Company
will not be required to (i) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it is not otherwise qualified or (ii) take
any action that would subject it to general service of process in suits or to
taxation in any such jurisdiction where it is not then so subject.

 

SECTION 4.         Holder’s Obligations.

 

Each Holder agrees, by acquisition of the Registrable Securities, that no Holder
of Registrable Securities shall be entitled to sell any of such Registrable
Securities pursuant to a Registration Statement or to receive a Prospectus
relating thereto, unless such Holder has furnished the Company with a properly
completed Notice and Questionnaire as required pursuant to this Section 4
(including the information required to be included in such Notice and
Questionnaire) and the information set forth in the next sentence. Each Holder
agrees to deliver a Notice and Questionnaire to the Company promptly upon
becoming a Holder and notify the Company of any change in such information at
least five (5) business days prior to the filing of the Initial Resale
Registration Statement or Subsequent Resale Registration Statement, as
applicable.  Each Notice Holder agrees promptly to furnish to the Company in
writing all information required to be disclosed in order to make the
information previously furnished to the Company by such Notice Holder not
misleading, any other information regarding such Notice Holder and the
distribution of such Registrable Securities as may be required to be disclosed
in the Registration Statement under applicable law or pursuant to SEC comments
and any information otherwise required by the Company to comply with applicable
law or regulations. Each Holder further agrees, following termination of the
Effectiveness Period, to notify the Company, within ten (10) Business Days of a
request, of the amount of Registrable Securities sold pursuant to the
Registration Statement and, in the absence of a response, the Company may assume
that all of the Holder’s Registrable Securities were so sold.

 

SECTION 5.         Registration Expenses.

 

The Company shall bear all fees and expenses incurred in connection with the
performance by the Company of its obligations under Sections 2 and 3 of this
Agreement whether or not any of the Registration Statements are declared
effective. Such fees and expenses shall include, without limitation, (i) all
registration and filing fees (including, without limitation, fees and expenses
(x) with respect to filings required to be made with the Toronto Stock Exchange
and the NYSE Amex (or such U.S. national securities exchange on which the Common
Stock is then listed) and (y) of compliance with U.S. federal and state
securities or “Blue Sky” laws to the extent such filings or compliance are
required pursuant to this Agreement (including, without limitation,

 

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reasonable fees and disbursements of the counsel specified in the next sentence
in connection with Blue Sky qualifications of the Registrable Securities under
the laws of such jurisdictions as the Notice Holders of a majority of the
Registrable Securities being sold pursuant to a Registration Statement may
designate)), (ii) printing expenses, (iii) duplication expenses relating to
copies of any Registration Statement or Prospectus delivered to any Holders
hereunder, and (iv) fees and disbursements of counsel for the Company in
connection with the Resale Registration Statement, provided, however, that the
Company shall not be responsible for any brokers’ fees, commissions or discounts
in connection with the sale of Registrable Securities or the fees and expenses
of legal counsel for the Holders.

 

SECTION 6.         Information Requirements.

 

The Company covenants that, if at any time before the end of the Effectiveness
Period the Company is not subject to the reporting requirements of the Exchange
Act, it will cooperate with any Holder of Registrable Securities and take such
further reasonable action as any Holder of Registrable Securities may reasonably
request in writing (including, without limitation, making such reasonable
representations as any such Holder may reasonably request), all to the extent
required from time to time to enable such Holder to sell Registrable Securities
without registration under the Securities Act within the limitations of Rule 144
under the Securities Act and customarily taken in connection with sales pursuant
to such exemptions. Upon the written request of any Holder of Registrable
Securities, the Company shall deliver to such Holder a written statement as to
whether it has complied with the filing requirements of Rule 144.

 

SECTION 7.         Indemnification and Contribution.

 

(a)           The Company agrees to indemnify and hold harmless each Holder of
Registrable Securities covered by the Resale Registration Statement, the
directors, officers, employees, Affiliates and agents of each such Holder and
each person who controls any such Holder within the meaning of either the
Securities Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Resale Registration Statement or in any amendment thereof,
in each case at the time such became effective under the Securities Act, or in
any preliminary Prospectus or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of any preliminary
Prospectus or the Prospectus, in the light of the circumstances under which they
were made) not misleading, and agrees to reimburse each such indemnified party,
as incurred, for any legal or other expenses reasonably incurred by it in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement

 

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or alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of the party claiming indemnification specifically for
inclusion therein. This indemnity shall be in addition to any liability that the
Company may otherwise have.

 

(b)           Each Holder of securities covered by the Resale Registration
Statement severally and not jointly agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who signs the Resale
Registration Statement and each person who controls the Company within the
meaning of either the Securities Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Company to each such Holder, but only with
reference to information relating to such Holder furnished to the Company by or
on behalf of such Holder specifically for inclusion in the documents referred to
in the foregoing indemnity. This indemnity agreement shall be acknowledged by
each Notice Holder that is not the Buyers in such Notice Holder’s Notice and
Questionnaire and shall be in addition to any liability that any such Notice
Holder may otherwise have.

 

(c)           Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 7, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party
(i) will not relieve it from liability under paragraph (a) or (b) above unless
such failure results in the forfeiture by the indemnifying party of substantial
rights and defenses or otherwise materially prejudices the indemnifying party;
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel (including local counsel) of the indemnifying party’s choice
at the indemnifying party’s expense to represent the indemnified party in any
action for which indemnification is sought (in which case the indemnifying party
shall not thereafter be responsible for the fees and expenses of any separate
counsel, other than local counsel if not appointed by the indemnifying party,
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party’s election to appoint
counsel (including one local counsel) to represent the indemnified party in an
action, the indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear the reasonable
fees, costs and expenses of such separate counsel if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified party would
present such counsel with a conflict of interest; (ii) the actual or potential
defendants in, or targets of, any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party; (iii) the indemnifying party shall not have employed

 

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counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of
such action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.

 

(d)           If the indemnification to which an indemnified party is entitled
under this Section 7 is for any reason unavailable to or insufficient although
applicable in accordance with its terms to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, in such proportion as is appropriate to reflect
the relative fault of the indemnifying party or parties on the one hand and of
the indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.

 

The relative fault of the Company on the one hand and the Holders of the
Registrable Securities on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or by the Holder of the Registrable
Securities and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

 

The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 7(d) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this Section 7(d). The aggregate amount of
losses, liabilities, claims, damages, and expenses incurred by an indemnified
party and referred to above in this Section 7(d) shall be deemed to include any
out-of-pocket legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.

 

Notwithstanding the provisions of this Section 7, no Holder of any Registrable
Securities shall be required to indemnify or contribute any amount in excess of

 

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the amount by which the proceeds received from the sale of the Registrable
Securities by such Holder of Registrable Securities exceeds the amount of any
damages that such Holder of Registrable Securities has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission.

 

No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.

 

For purposes of this Section 7(d), each person, if any, who controls Buyers or
any Holder of Registrable Securities within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as Buyers or such Holder, and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act shall have the same rights to contribution as the Company.

 

(e)           The provisions of this Section 7 shall remain in full force and
effect, regardless of any investigation made by or on behalf of any Holder or
the Company or any of the indemnified persons referred to in this Section 7, and
shall survive the sale by a Holder of Registrable Securities covered by the
Resale Registration Statement.

 

SECTION 8.         Miscellaneous

 

(a)           Successors and Assigns.  Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of the other parties.  Subject
to the preceding sentence, this Agreement shall be binding upon, inure to the
benefit of, and be enforceable by, the parties and their respective permitted
successors and assigns.  If any permitted transferee of any Holder shall acquire
Registrable Securities, such Registrable Securities shall be subject to all of
the terms of this Agreement and by taking and holding such Registrable
Securities such person shall be conclusively deemed to have agreed to be bound
by and to perform all of the terms and provisions of this Agreement.  Nothing in
this Agreement is intended to confer upon any party other than the parties
hereto or their respective permitted successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.

 

(b)           Notices. Unless otherwise provided herein, any notice, request,
waiver, instruction, consent or document or other communication required or
permitted to be given by this Agreement shall be effective only if it is in
writing and (i) delivered by hand or sent by certified mail, return receipt
requested, (ii) if sent by a nationally-recognized overnight delivery service
with delivery confirmed, or (iii) if sent by facsimile (or other similar
electronic means), with receipt confirmed as follows:

 

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Company:

Golden Minerals Company

 

350 Indiana Street, Suite 800

 

Golden, Colorado 80401

 

Attn: President

 

Fax: (303) 839-5907

 

 

with a copy to:

Davis Graham & Stubbs LLP

 

1550 17th Street, Suite 500

 

Denver, Colorado 80202

 

Attn: Deborah J. Friedman

 

Fax: (303) 892-7400

 

 

Buyers:

Sentient Global Resources Fund III, LP

 

SGRF III Parallel I, LP

 

Landmark Square, 1st Floor, 64 Earth Close, West Bay Beach South

 

PO Box 10795

 

George Town, Grand Cayman KY1-1007

 

CAYMAN ISLANDS

 

Attention: Sue Bjuro — Office Manager

 

 

with a copy to:

Quinn & Brooks, LLP

 

c/o Gregory A. Smith

 

9800 Mt. Pyramid Ct., Suite 400

 

Englewood, Colorado 80112

 

The parties shall promptly notify each other of any change in their respective
addresses or facsimile numbers or of the individual or entity or office to
receive notices, requests or other communications under this Section 8(b).  All
notices shall be deemed to have been given (i) if personally delivered or sent
by certified mail, as of the date when so delivered, (ii) if sent by
nationally-recognized overnight delivery service, two days after mailing, or
(iii) if sent by facsimile (or other similar electronic means) as of the date
sent, if during normal business hours of the recipient, and otherwise on the
next business day.

 

(c)           Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, without the written consent of the Company and the Holders of
a majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of Holders of Registrable
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders pursuant to such Registration
Statement; provided, that the provisions of this sentence may not be amended,
modified, or supplemented

 

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except in accordance with the provisions of the immediately preceding sentence.
Each Holder of Registrable Securities outstanding at the time of any such
amendment, modification, supplement, waiver or consent or thereafter shall be
bound by any such amendment, modification, supplement, waiver or consent
effected pursuant to this Section 8(c), whether or not any notice, writing or
marking indicating such amendment, modification, supplement, waiver or consent
appears on the Registrable Securities or is delivered to such Holder.

 

(d)           Severability.  Any term or provision of this Agreement that is
held by a court of competent jurisdiction or other authority to be invalid, void
or unenforceable in any situation in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.  If the final judgment of a court of
competent jurisdiction or other authority declares that any term or provision
hereof is invalid, void or unenforceable, the parties agree that the court
making such determination shall have the power to reduce the scope, duration,
area or applicability of the term or provision, to delete specific words or
phrases, or to replace any invalid, void or unenforceable term or provision with
a term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision.

 

(e)           Governing Law.  This Agreement shall be governed by and construed
in accordance with the internal laws (as opposed to the conflicts of law
provisions) of the State of Colorado.

 

(f)            Submission to Jurisdiction.  The parties hereby submit to the
non-exclusive jurisdiction of any court of the State of Colorado or the United
States District Court for the District of Colorado for the purpose of any suit,
action, or other proceeding arising out of this Agreement, and waive any and all
objections to jurisdiction that they may have under the laws of the State of
Colorado or the United States and any claim or objection that any such court is
an inconvenient forum.

 

(g)           Entire Agreement.  This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof.

 

(h)           Counterparts.  This Agreement may be executed in two or more
counterparts (including by facsimile or similar means of electronic
communication), each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

(i)            Specific Performance.  Buyers and the Company each agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed by them in accordance with the terms hereof and
that each party shall be entitled to specific performance of the terms hereof,
in addition to any other remedy at law or equity.  Each party hereto expressly
waives any

 

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requirement that any other party hereto obtain any bond or provide any indemnity
in connection with any action seeking injunctive relief or specific enforcement
of the provisions of the Agreement.

 

(j)            Expenses.  All reasonable, documented out-of-pocket costs and
expenses  incurred by the parties in connection with the negotiation,
preparation, execution and delivery of this Agreement, including the fees,
expenses and disbursements of legal counsel and accountants, shall be paid by
the Company.  Except as otherwise set forth in this Agreement, costs and
expenses incurred by the parties in connection with the performance of its
obligations under this Agreement shall be paid by the party incurring such
expenses.  The prevailing party in any litigation or other proceeding to collect
Liquidated Damages pursuant to this Agreement shall be entitled to collect from
the non-prevailing party all reasonable costs and fees associated with such
litigation or proceeding, including reasonable attorneys’ fees.

 

(k)           Approval of Holders. Whenever the consent or approval of Holders
of a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its Affiliates (other than Buyers
or subsequent Holders of Registrable Securities if such subsequent Holders are
deemed to be such Affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.

 

(l)            Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the earlier to occur of (i) the expiration of the
Effectiveness Period or (ii) such time as there shall be no Registrable
Securities.

 

* * * * *

 

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IN WITNESS WHEREOF, the parties have executed this REGISTRATION RIGHTS AGREEMENT
as of the date first written above.

 

 

GOLDEN MINERALS COMPANY

 

 

/s/ Jeffrey G. Clevenger

 

Name:

Jeffrey G. Clevenger

Title:

Chief Executive Officer and President

 

 

SENTIENT GLOBAL RESOURCES FUND III, LP

 

 

By:

Sentient GP III, L.P., General Partner

 

By:   Sentient Executive GP III, Limited, General Partner

 

 

 

 

By:

/s/ Gregory Link

 

Name:

Gregory Link

Title:

Director

 

 

 

 

SGRF III PARALLEL I, L.P.

 

 

By:

Sentient GP III, L.P., General Partner

 

By:   Sentient Executive GP III, Limited, General Partner

 

 

 

 

By:

/s/ Gregory Link

 

Name:

Gregory Link

Title:

Director

 

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