**EXHIBIT 10.26**

 

**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT.THE COPY FILED HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITYREQUEST.  OMISSIONS ARE DESIGNATED AS[****]. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THESECURITIES AND EXCHANGE COMMISSION.**

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**MOLYBDENUM SUPPLY AGREEMENT**

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THIS MOLYBDENUM SUPPLYAGREEMENT (this “Agreement”) is made and entered into as of the 8thday of August, 2008 by and between General Moly, Inc., a Delawarecorporation (“***GeneralMoly***”), and Sojitz Corporation, a Japanese corporation (“***Buyer***”). Each ofGeneral Moly and Buyer are individually referred to herein as a “Party” andtogether as the “***Parties***.”

 

**RECITALS**

** **

A.            Eureka Moly, LLC (“***Eureka Moly***”) leasesand intends to operate a mine located in Eureka County, Nevada (the “***Mount Hope Mine***”)from which it intends to produce Technical Grade Molybdenum Oxide (“***TMO***”), in the form ofpowder and carbon-free briquettes, that meets or exceeds the standards on Exhibit A(the “***Products***”);

 

B.            As of the date hereof,(i) General Moly, through its wholly-owned subsidiary Nevada Moly, LLC,owns an 80% equity interest in Eureka Moly and (ii) POS-MineralsCorporation, a Delaware corporation and affiliate of POSCO Canada Ltd., owns a20% equity interest in Eureka Moly; and

 

C.            General Moly wants tosell to Buyer, and Buyer wants to purchase from General Moly, Productsavailable from General Moly’s share of production at the Mount Hope Mine (offeris for output of Mount Hope Mine production only) upon the terms and subject tothe conditions set forth herein.

 

NOW, THEREFORE, for good andvaluable consideration, the receipt and sufficiency of which are herebyacknowledged, the Parties, intending to be legally bound, agree as follows:

 

**AGREEMENT**

** **

1.             **Definitions and Construction**.

 

1.1           Defined Terms.In addition to the capitalized terms defined elsewhere in this Agreement, forpurposes of this Agreement:

 

“***Adjusted Market Price***” means (a) theapplicable Market Price times (b) [****].

 

“***Affiliate***” of any Person means any otherPerson directly or indirectly, through one or more intermediaries, controlling,controlled by or under common control with such Person. A Person will be deemedto control another Person if the controlling Person is the beneficial owner ofgreater than 50% of any class or voting securities (or other voting or equityinterests) of the 

 

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controlledperson or possesses, directly or indirectly, the power to direct or cause thedirection of the management or policies of the controlled Person, whetherthrough ownership of capital stock, by contract or credit arrangement, astrustee or executor, or otherwise.

 

“***Annual Amount***” means, for any calendaryear during the Term, the sum of (i) the Base Amount and (ii) theAdditional Amount for such calendar year.

 

“***Available Production***” means the amountof Products available from General Moly’s share of production at the Mount HopeMine after satisfaction of the Existing Obligations.

 

“***Business Day***” means a day other them aSaturday or Sunday or a day on which banks are required or authorized to beclosed in the State of New York or in Japan.

 

“***CIF***” has the meaning given to it in theInternational Chamber of Commerce’s official rules for the interpretationof trade terms known as Incoterms 2000.

 

“***Existing Obligations***” means General Moly’scontractual obligations relating to the supply of Products from General Moly’sshare of production at the Mount Hope Mine that are in existence as of the dateof this Agreement, or which are currently under negotiation, as set forth in Exhibit B.

 

“***Floor Price***” per pound of molybdenumcontained in the Products means:

 

(a)           for 2008, $[****], and

 

(b)           for 2009 and thereafter:

 

$[****] x (1 + [****] Percentage Change), butin no event less than $[****].

 

For clarification, (i) theFloor Price will only be adjusted [****], which will occur [****] of theinformation necessary to calculate the applicable [****] Percentage Changebecoming [****] available [****], (ii) to the extent the informationnecessary to calculate such adjustment is not available [****], the adjustmentwill be calculated when such information becomes available and appliedretroactively [****], and (iii) the Floor Price will be calculated as setforth above regardless of the Market Price or any other adjustments to theProduct Price (as defined in Section 3). All adjustments will beretroactive to the Product sales [****]. Appropriate retroactive adjustmentswill be reflected in the following month’s invoice cycle and will be subject tothe same payment terms as regular sales.

 

“***Losses***” means any claims, losses,liabilities, damages, demands, fines, penalties, administrative and judicialproceedings and orders, judgments, remedial action, enforcement actions of anykind, and all reasonable and documented costs and expenses incurred inconnection therewith (including reasonable attorneys’ fees).

 

“***Market Price***” means the average of thePlatt’s Metals Week published prices for TMO Dealer Oxide during (a) themonth that was agreed for shipment, regardless of the month of actual shipment,or (b) the month prior to the month that was agreed for shipment,regardless of the month of actual shipment, as Buyer may determine annuallypursuant to Section 3.2. In the 

 

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event that thebasis for the Market Price ceases to exist or ceases to be published, theParties shall meet promptly with a view to agreeing on a new pricing basis andthe date for bringing such basis into effect.

 

“***Person***” means an individual, limited orgeneral partnership, corporation, trust, limited liability company,unincorporated organization, association, joint venture or a government oragency or political subdivision or instrumentality thereof.

 

“[****] ***Percentage Change***”means [****].

 

“***Sales Territory***” means, unless otherwiseagreed by the Parties in writing, (a) Japan, for which Buyer has anexclusive right to market, sell and distribute the Products (the “***Exclusive Sales Territory***”),and (b) South Korea, for which Buyer has a non-exclusive right to market,sell and distribute the Products during the three- (3-) year period followingthe Commencement Date (e.g., if the Commencement Date is January 1, 2011,such non-exclusive right runs through December 31, 2013). Thereafter,Buyer’s non-exclusive right In South Korea shall continue during the Term,unless revoked or otherwise limited by General Moly upon twelve (12) monthswritten notice to Buyer, in the event that General Moly desires to enter intoan exclusive sales agreement with a third party with respect to South Korea.

 

“***Term***” means the term of this Agreementas set forth in Section 5 hereof.

 

“***Three-Month LIBOR***” means the rate fordeposits in U.S. Dollars for a period of three months that appears on Reuters page LIBOR01(or such other replacement page) as of 11:00 a.m. London time on the datean applicable invoice is due hereunder. If Three-Month LIBOR is not availablefrom such source, then Three-Month LIBOR will be based on quotations from fourmajor reference banks in the London interbank market for deposits in U.S.dollars for a period of three months.

 

1.2           Construction.

 

1.2.1        The words “include,” “includes,” and “including”will be deemed to be followed by “without limitation.”

 

1.2.2        Any term importing the singular includes theplural and vice versa.

 

1.2.3        Any reference to a gender includes the othergenders.

 

1.2.4        Any reference to “pounds” in this Agreementrefers to pounds of molybdenum contained in the Products.

 

1.2.5        The headings in this Agreement have beeninserted for convenience only and will not be taken into account in itsinterpretation.

 

2.             **Commencement Date and Supply Purchase Commitments**

 

2.1           No Obligation UntilCommencement Date. No obligation to supply or purchase Products under thisAgreement will exist prior to the first January 1st (the “***Commencement***

 

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***Date***”) followingtwo consecutive months during which output at the Mount Hope Mine equals orexceeds 1.7 million pounds of molybdenum contained in the TMO produced duringeach such mouth (the “***ProductionDate***”). General Moly will notify Buyer of the Production Datenot less than ten (10) calendar days following the occurrence of theProduction Date. If the Commencement Date has not been reached by January 1,2013, then Buyer may at its sole option terminate this Agreement.

 

2.2           Supply of ProductsAfter Commencement Date. Upon the terms and subject to the conditions setforth in this Agreement, General Moly agrees to supply to Buyer, and Buyeragrees to purchase from General Moly, subject to the Available Production, theamount of Products as follows:

 

2.2.1        For each calendar year following theCommencement Date, five million (5,000,000) pounds of Products (the “***Base Amount***”).

 

2.2.2        For each calendar year following theCommencement Date, General Moly and Buyer shall enter into discussions todetermine if any additional amount of Products snail be supplied under thisAgreement (any such quantity of Products, an “***Additional Amount***”), up to a maximum of[****] ([****]) additional pounds in any calendar year (which amount shall beprorated for any portion of a calendar year), and the prices for any suchAdditional Amount; provided that such determination must be made (a) bythe Commencement Date, in the case of the calendar year in which theCommencement Date occurs and the subsequent calendar year if the CommencementDate occurs after September 30, and (b) by September 30 of theprior year, for each calendar year beginning with the calendar year after theCommencement Date. For clarification, if General Moly and Buyer do not agree(each in its own discretion) on the quantity or pricing with respect to anysuch Additional Amount in accordance with the foregoing deadlines, General Molyshall have no obligation under this Agreement to supply any Additional Amountfor the applicable calendar year.

 

2.3           Monthly Quantities.The quantity of Product to be delivered pursuant to Section 2.2shall be taken in approximately equal monthly quantities over the course of theparticular calendar year. The Parties will reasonably cooperate with each otherin connection with forecasting, ordering and delivery schedules and procedures.If after the Commencement Date General Moly fails to deliver the quantity ofProducts required to be delivered pursuant to this Agreement for a period oftwo consecutive months, Buyer shall have the right to require that General Molysupply such shortfall in subsequent months, subject to Available Production, atsuch Product Price as would have applied if the Products had been shippedpursuant to the originally agreed delivery schedule. This is a best effortsupply agreement based on the Available Production of Mount Hope Mine with norecourse to short supply except to allow it to be made up in future months, atBuyer’s request, when supply is available.

 

2.4           Take-and-Pay.Notwithstanding anything herein to the contrary, Buyer agrees that if Buyerfails to take delivery of Products conforming to the Specifications madeavailable by General Moly in the amounts and on the terms set forth in thisAgreement up to the Annual Amount in each calendar year during the Term, Buyerwill still be obligated to pay General Moly with respect to such Products asthough Buyer had taken delivery pursuant to the terms of this 

 

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Agreement. Anysuch shortfall in a calendar quarter that exceeds ten percent (10%) of thepro-rated Annual Amount will be invoiced as if supplied in the first month ofthe following quarter, along with supporting documentation reasonablyacceptable to Buyer, with pricing to be the average of the quarter in which theshortfall occurred, and Buyer shall have the right to determine the dispositionof such Products.

 

2.5           Composition ofProducts. All Products contemplated under this Agreement shall conform tothe specification listed in Section 2.6 and unless otherwise agreedby the Parties shall be supplied as TMO in powder form in 250kg drums onpallet. To the extent available, General Moly will make available to Buyer theProducts in other forms and packaging at mutually agreed discounts or premiumsdepending on the Product form selected.

 

2.6           Specifications.The specifications and technical requirements of the Products to be deliveredhereunder are set forth in Exhibit A (the “***Specifications***”).Notwithstanding anything herein to the contrary, Buyer will not be requiredhereunder to purchase any Products which do not comply with the Specifications.

 

2.7           Sales Territory.Without the prior written consent of General Moly (which consent shall be atthe sole discretion of General Moly), during the Term, Buyer agrees that itwill not (a) sell, transfer or otherwise distribute any Products outsideof the Sales Territory, (b) enter into any agreement or arrangement with anyother party or amend any existing agreement or arrangement regarding the sale,transfer or other distribution of any Products outside of the Sales Territory,or (c) take any other action to intentionally circumvent the restrictionsset forth in (a) and (b) above. For the avoidance of doubt, Buyer maydistribute TMO or any other product not purchased by Buyer from General Moly inany territory.

 

2.9           Certain Sales byGeneral Moly. Without the prior written consent of Buyer (which shall be atthe sole discretion of Buyer), during the Term, General Moly agrees that itwill not (a) sell, transfer or otherwise distribute any Products withinthe Exclusive Sales Territory, or enter into an agreement or arrangement withanother party for its sale, transfer or distribution of Products within theExclusive Sales Territory except that covered under Section 6.2, (b) amendany Existing Obligation pursuant to which General Moly is obligated to supplyProducts from the Mount Hope Mine to any destination within the Exclusive SalesTerritory, or (c) take any other action to intentionally circumvent therestriction set forth in (a) above.

 

3.             **Pricing and Payment Terms**. The pricepayable by Buyer to General Moly for Products supplied by General Moly to Buyerpursuant to this Agreement (the “***Product Price***”) will be equal to the BaseProduct Price plus any mutually agreed premiums or minus anymutually agreed discounts for Products supplied pursuant to the terms of thisAgreement that is other than TMO in powder form in 250kg drums on pallet.

 

3.1           Base Product Price.The base price payable by Buyer to General Moly for Products supplied byGeneral Moly to Buyer pursuant to this Agreement (the “***Base Product Price***”)will be as follows:

 

3.1.1        For the first [****] pounds of Base Amountdelivered in any calendar month, the Base Product Price will be equal to:

 

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(a)           if the Adjusted MarketPrice is less than or equal to the Floor Price, an amount equal to the FloorPrice; and

 

(b)           if the Adjusted MarketPrice exceeds the Floor Price, an amount equal to the Adjusted Market Price.

 

3.1.2        For any portion of the Base Amount in excess of[****] pounds delivered in any calendar month, the Base Product Price will beequal to:

 

Market Price

 

x      [****]

 

3.1.3        For any Additional Amount, the Parties shalldiscuss and agree on the Base Product Price.

 

3.2           Determination ofMarket Price. No later than (a) the Commencement Date, for thecalendar year in which the Commencement Date occurs, and (b) November 30of the prior calendar year for any subsequent calendar year during the Term,Buyer will give written notice to General Moly of the method of determiningMarket Price (as set forth in the definition of Market Price in Section 1).No later than November 30 of the prior calendar year, for any subsequentcalendar year during the Term, Buyer will give written notice to General Molyof the general Product forms, types and packaging requested to be suppliedhereunder in the following calendar year, with specific quantities, forms,types and packaging to be notified pursuant to Section 4.4 hereof.The Parties agree to cooperate in good faith to reach agreement to determinepremiums and/or discounts for Product supplied pursuant to the terms of thisAgreement that is other than TMO in 250kg drums on pallet. To the extent theParties cannot reach such agreement by December 31 of the year in whichsuch notice was delivered, the Products for the following calendar year shallbe supplied as TMO in 250kg drums on pallet. In the event the price is notknown at the time of shipment, a provisional invoice will be issued using the “MarketPrice for the month prior to the month of shipment” as the pricing basis, and afinal invoice shall be provided within ten (10) days after determinationof such final price. If the final invoice indicates that further payment byBuyer is required, Buyer shall pay such amount by wire transfer to General Molywithin ten (10) days of receiving such final invoice. If the final invoiceindicates that Buyer is due a refund, General Moly shall apply a correspondingcredit to Buyer’s account.

 

4.             **Deliveries and Invoices**.

 

4.1           Delivery Point.All Products will be delivered CIF major Japanese port of discharge (includingYokohama, Nagoya, Osaka, Kobe and Moji), unless otherwise agreed by theParties, in which case Buyer will be charged or credited, as appropriate, thesurcharge or savings at cost for such point of delivery. The Product Price isCIF major Japanese port, or as otherwise agreed by the Parties.

 

4.2           Invoices. Uponeach shipment of Products, General Moly will invoice Buyer for thecorresponding Product Price. General Moly will, at its expense, supply acertificate confirming that each shipment of Products complies with theSpecifications, evidence in form and substance reasonably satisfactory to Buyerof the quantity of Products loaded on to the ship, and an ocean bill of lading.The invoice date will be the ocean bill of lading date and the amount 

 

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shown on suchinvoice will be due and payable by wire transfer to an account identified byGeneral Moly within thirty (30) days of the date of the ocean bill of lading,subject to any Assay Adjustment as set forth in Section 4.3. IfBuyer fails to pay any undisputed invoice amount pursuant to this Agreement onor before the applicable due date, interest on the unpaid amount at a rate perannum equal to Three-Month LIBOR plus one point five percent (1.5%) each yearwill accrue from the applicable due date until the full invoice amount is paid.

 

4.3           Assay Adjustments.

 

4.3.1        Buyer has the right to appoint a neutralsampler (the “***Sampler***”),approved by General Moly (which approval will not be unreasonably withheld ordelayed), to take samples of the Products at the applicable delivery point.Without prejudice to any other right of Buyer hereunder, in the event thatBuyer determines that General Moly has delivered Product with an incorrectpercentage of Mo content, which should result in an adjustment to the ProductPrice (an “***AssayAdjustment***”), Buyer will notify General Moly in writing of suchdetermination (along with its results of analysis of such Product) within sixty(60) days of receipt of such shipment. The Parties will appoint a mutuallyagreeable third party to assist in the resolution of such matter (the “***Referee***”) withinseventy-five (75) days of delivery of such notice. If the Parties fail to soappoint the Referee within such seventy-five (75) day period, SGS Group (orsuch other mutually agreeable third party, in the event that SGS Group or itssuccessor ceases to exist) will act as the Referee at any Party’s request. TheReferee will analyze the sample of such Product taken by the Sampler, whosedetermination will be final and binding upon the Parties.

 

4.3.2        The costs and expenses related to theprocedures set forth in this Section 4.3 (including the costs ofthe Sampler and Referee) will be borne by the Party whose results are furthestfrom the results of the Referee. In the event that the results of the Refereeare exactly between those of General Moly and the Buyer, each of General Molyand the Buyer will bear fifty percent (50%) of any such costs and expenses, Forthe purpose of the foregoing, the “results” of General Moly will refer to theassay results set forth on the related invoice.

 

4.3.3        In the event that the final determinationresults in an obligation on a Party to pay additional amounts or to reimburseany sum, such payment or reimbursement will be settled by credit or debit set forthon the next invoice delivered by General Moly to Buyer.

 

4.4           Monthly Notification.Without limiting the provisions of Section 2.3, Buyer will provideGeneral Moly with written notice of required quantities and shipping dates nolater than thirty (30) days prior to the intended month of shipment, as well asthe delivery points, forms, types and packaging of Products to be suppliedhereunder during such month.

 

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5.             **Term; Termination**.

 

5.1           Term. The initialterm of this Agreement will commence on the date hereof and expire five (5) yearsfrom the Commencement Date unless sooner terminated in accordance with theterms of this Agreement.

 

5.2           Termination.This Agreement may be terminated by:

 

(a)           eitherParty at any Time in the event of a material breach of this Agreement by theother Party, provided a written termination notice identifying the materialbreach has been sent to the breaching Party and the breach has not been curedwithin sixty (60) days from the date of said notice;

 

(b)           eitherParty at any time, by written notice, in the event:

 

(i)            ofinsolvency of the other Party;

 

(ii)           ofthe filing of a voluntary petition in bankruptcy of the other Party;

 

(iii)          ofthe making of an assignment for the benefit of creditors by the other Party,excluding assignments of accounts receivable;

 

(iv)          ofthe inability of the other Party to pay its debts as they come due;

 

(v)           theother Party has a receiver or other custodian of any kind appointed toadminister any substantial amount of the other Party’s property;

 

(vi)          ofthe filing of all involuntary petition in bankruptcy with respect to the otherParty;

 

(vii)         anyproceedings for the reorganization of the other Party, or for the readjustmentof any of the other Party’s debts, under any laws, now or hereafter existing,for the relief of insolvent debtors, will be commenced by or against the otherParty; or

 

(viii)        ofthe discontinuation by the other Party of its business;

 

(c)           Buyer,by written notice, in the event that after the Commencement Date, General Molyfails to meet the delivery requirements of Products set forth in Section 2for a period of three consecutive months; or

 

(d)           Buyer,by written notice, in accordance with Sections 2.1 and 7.

 

5.3           Effect of Termination.Unless notified otherwise by Buyer, upon a termination of this Agreement,General Moly will fill all outstanding obligations to supply the Products inaccordance with the terms of this Agreement through the date of termination.Buyer will accept and pay for all conforming Products delivered in accordanceherewith. Termination will be without prejudice to the rights and obligationsof the Parties which have accrued prior to the effective date of termination. Sections1, 4 and 6 through 24 will survive the expiration ortermination of this Agreement.

 

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6.             **Indemnification**.

 

6.1           Procedure. ifBuyer claims that any of the Products fail to conform with the Specificationsor fail to be in compliance with all applicable laws (excluding claims relatingto Assay Adjustments which will be resolved in accordance with Section 4.3),Buyer will notify General Moly of its claim (“***Claim***”), and provide General Moly withall relevant documentation of the Claim, no later than sixty (60) days afterthe date of delivery of such Products to Buyer. Upon receipt of a Claim,General Moly will have the right to inspect such Products and all evidence ofthe Claim, and General Moly and Buyer will make a good faith attempt to reach anagreement as to whether the Claim is valid.

 

6.2           Remedies. If itis determined by the Parties that the Claim is valid, General Moly willpromptly elect one of the following actions to remedy the failure, and willdeliver notice thereof to Buyer thirty (30) days prior to taking any suchaction:

 

(a)           promptlydelivering to Buyer (to the original destination, unless otherwise agreed) atno additional cost to Buyer, conforming Products to replace the non-conformingProducts;

 

(b)           promptlyrefunding to Buyer the Product Price paid by Buyer for the non-conformingProducts; provided that General Moly will have the option to take possession ofthe non-conforming Products; and provided that the quantities of suchnon-conforming Products shall be deducted from the quantity of Products thatBuyer is required to purchase hereunder; or

 

(c)           applyinga credit, equal to the Product Price paid by Buyer for the non-conformingProducts, to the next purchase to be made by Buyer hereunder provided that thequantities of such non-conforming Product shall be deducted from the quantityof Products that Buyer is required to purchase hereunder.

 

If, upon receipt of notice ofthe intent to take one of the actions above, Buyer instead desires General Molyto take another action listed above to remedy the failure, Buyer will delivernotice of such desire to General Moly. If upon delivery of such notice theParties do not agree on the action to be taken, such matter will be resolvedpursuant to the arbitration procedures set forth in Section 21.Buyer agrees that General Moly may offer and sell any non-conforming Productsrejected pursuant to a Claim under this Section 6.2 within theSales Territory after Buyer has been offered and rejected an offer to purchasesuch non-conforming Products; *provided,however*, that any such offer and sale by General Moly ofnon-conforming Products within the Sales Territory be upon the same terms andconditions, including pricing, as offered by General Moly to Buyer.

 

If the Parties cannot agree onthe validity of a Claim, such matter will be considered a Dispute and will beresolved pursuant to the arbitration procedures set forth in Section 21.

 

6.3           Warranties.

 

Subject to the limits set forth in Section 6.4,**GENERAL MOLY WARRANTS TO BUYER THAT AT THETIME THE PRODUCTS ARE SHIPPED, THE PRODUCTS WILL (I) **

 

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**CONFORM TO THESPECIFICATIONS, AND (II) BE OWNED SOLELY BY GENERAL MOLY AND BE FREE FROMANY SECURITY INTEREST, LIEN OR OTHER ENCUMBRANCE. GENERAL MOLY WARRANTS TOBUYER THAT ALL WORK PERFORMED PURSUANT TO THIS AGREEMENT BY GENERAL MOLY WILLBE PERFORMED IN ACCORDANCE WITH ALL APPLICABLE LAWS AND REGULATIONS INCLUDINGENVIRONMENTAL LAWS AND REGULATIONS.**

 

6.4           Limitations. Theremedies set forth in Sections 6.2 and 6.5 will be Buyer’s soleremedies for any Claims. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW,EXCEPT AS PROVIDED HEREIN, GENERAL MOLY EXPRESSLY DISCLAIMS, AND MAKES NO OTHEREXPRESS OR IMPLIED WARRANTIES OF ANY TYPE, WHETHER OF MERCHANTABILITY, FITNESSFOR A PARTICULAR PURPOSE OR USE OR OTHERWISE, WITH RESPECT TO THE PRODUCTS.

 

6.5           Indemnification byGeneral Moly. General Moly will at all times defend, indemnify, protect andhold harmless Buyer and its affiliates and their directors, officers, agents,employees, participants and assigns, from and against any and all Lossesarising in whole or in part out of the willful misconduct and/or grossnegligence in the performance of any obligations of General Moly under thisAgreement; *provided however*, thatGeneral Moly will not be required to indemnify any indemnified Person for anyLosses to the extent resulting from the misconduct or gross negligence of suchindemnified Person.

 

6.6           Indemnification byBuyer. Buyer will at all times defend, indemnify, protect and hold harmlessGeneral Moly and its affiliates and their directors, officers, agents,employees, participants and assigns, from and against any and all Losseswhatsoever arising in whole or in part out of the willful misconduct and/orgross negligence in the performance of any obligations of Buyer under thisAgreement; *provided however*, thatBuyer will not be required to indemnify any indemnified Person for any Lossesto the extent resulting from the misconduct or gross negligence of such indemnifiedPerson.

 

7.             **Force Majeure**. Neither Party will beliable to the other Party for default or delay in the performance of itsobligations hereunder when and to the extent that such default or delay iscaused by an order, injunction or stay entered by any court with validjurisdiction, war, civil commotion, strike, labor dispute, work stoppage orslowdown, storm, earthquake, explosion, insurrection, epidemic or quarantinerestriction, fire, flood, act of God, or any other similar contingency beyondthe reasonable control of the Party seeking to be excused from performing itsobligations hereunder pursuant to this Section 7 (the occurrence ofany of the foregoing will be an “***Event of Force Majeure***”). The occurrence ofan Event of Force Majeure will not be grounds for termination of thisAgreement, absent the written consent of the Parties otherwise; *provided, however*, that Buyer may, at itsoption, terminate this Agreement if an Event of Force Majeure prevents, orBuyer reasonably anticipates that it will prevent, General Moly from meetingits obligations in whole or in substantial part under this Agreement for morethan three (3) consecutive months during the Term. If an Event of ForceMajeure prevents a Party from meeting its obligations hereunder in part, butnot in whole, the Parties will use their commercially reasonable best effortsto equitably adjust the Parties’ respective obligations hereunder consistentwith and in furtherance of the purposes hereof. Should General Moly invokeforce majeure conditions, Buyer will be entitled to obtain from alternativesources such 

 

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Products as itreasonably requires during the period that Events of Force Majeure subsist, andthe quantities of Products obtained under such conditions will be deducted fromthe amount of Products Buyer is required to purchase hereunder.

 

8.             **Confidentiality**.

 

8.1           During the Term, eachof Buyer and General Moly will be in a position to receive certain of eachother’s confidential, privileged and proprietary information (“***Confidential Information***”).Confidential Information excludes any information:

 

(a)           whichis or becomes available to the public through no act, omission or fault of, andabsent any breach of a covenant or obligation hereunder by, a Party;

 

(b)           whicha Party may have received lawfully from any third party without restrictions asto disclosure thereof and without breach of this Agreement; or

 

(c)           whichwas developed by a Party without (as established by documentation or by otherappropriate evidence) the use of the other Party’s Confidential Information orany breach of this Agreement or any other agreement.

 

General Moly agrees that the ConfidentialInformation of Buyer, and Buyer agrees that the Confidential Information of GeneralMoly, is an integral and key part of the assets of each respective entity andthat the unauthorized use or disclosure of the other Party’s ConfidentialInformation would seriously damage the owner thereof in its business. As aconsequence of the above, General Moly and Buyer hereby agree that, during theTerm and for a period of five (5) years after the expiration ortermination hereof:

 

8.1.1        Neither of General Moly and Buyer will,directly or indirectly:

 

(a)           useany of the other Party’s Confidential Information, except as may be necessaryto perform its obligations hereunder; or

 

(b)           disclose,furnish or make accessible, or cause any Person to disclose, furnish or makeaccessible, any aspect of the other Party’s Confidential Information to anyPerson (other than its employees and representatives who require access to suchConfidential Information in connection with this Agreement and agree to keepsuch Confidential Information confidential in accordance with this Agreement).

 

8.1.2        Each of General Moly and Buyer will:

 

(a)           useno less than the care a reasonably prudent Person would use in safeguardinghis, her or its Confidential Information;

 

(b)           limitaccess to the other Party’s Confidential Information to its employees andrepresentatives who require access to such Confidential Information for thepurposes of performing its obligations hereunder and who have agreed to bebound by the terms of this Section 8; and

 

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(c)           refrainfrom any action or conduct which might reasonably or foreseeably be expected tocompromise the confidential, privileged or proprietary nature or the otherParty’s Confidential Information.

 

8.1.3        Each of General Moly and Buyer will comply withreasonable requests made by the other from time to time regarding theprotection of the confidential, privileged and proprietary nature of the otherParty’s Confidential Information. Upon the written request of either Party, theother Party will promptly return to the requesting Party all of the requestingParty’s Confidential Information, including any and all copies and summariesthereof, in each case in any format (whether written, electronic or otherwise).

 

8.1.4        For purposes of this Section 8, theterm “General Moly” will include all Affiliates of General Moly, and the term “Buyer”will include all Affiliates of Buyer. Nothing in this Section 8will operate to prevent a Party from disclosing such information as is requiredby (a) applicable law, (b) a valid court order or (c) the rules orpolicies of any securities exchange on which a Party’s securities may be listedor as may be expressly authorized by the other Party in writing in advance ofany such disclosure; *provided, however*,that in the case of a disclosure pursuant to clause (a), (b) or (c) ofthis sentence, prior to any such disclosure, the Party whose obligation it isto keep such information confidential will give the other Party notice of thecircumstances relating to such required disclosure and a reasonable opportunityto seek an appropriate protective order with respect thereto.

 

9.             **Waiver**. The failure of any Party toenforce at any time any of the provisions of this Agreement will in no way beconstrued to constitute a waiver of any such provision nor in any way to affectthe validity of this Agreement or any part hereof, including the right of anyParty thereafter to enforce each and every provision. The waiver by any Partyof any breach or violation of any provision of this Agreement by the otherParty will not operate or be construed to be a waiver of any subsequent breachor violation thereof.

 

10.           **Governing Law**. This Agreement will begoverned by the laws of the State of New York, without giving effect to any ofthe provisions thereof that would require the application of the substantivelaws of any other jurisdiction.

 

11.           **Notices**. All notices and othercommunications hereunder will be effective if in writing and delivered (a) inperson (which will be deemed to be received upon receipt), (b) byovernight courier (which will be deemed to be received one Business Daythereafter), (c) by facsimile transmission (which will be deemed to bereceived upon receipt) or (d) mailed by certified mail, postage prepaid,return receipt requested (which will be deemed to be received three BusinessDays thereafter), as follows (or at such other address for a Party as will bespecified by like notice):

 

If to General Moly:

 

General Moly, Inc.

1726 ColeBlvd., Suite 115

Lakewood,Colorado 80401

Attention:              Chief ExecutiveOfficer

Facsimile:               (303) 928-8598

 

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With a copy (which will notconstitute notice) to:

 

K&L GatesLLP

925 FourthAvenue, Suite 2900

Seattle,Washington 98104

Attention:              Gary J. Kocher

Facsimile:               (206) 623-7022

 

If to Buyer:

 

SojitzCorporation

FerroalloysDepartment

1-20, Akasaka6-chome, Minato-ku

Tokyo107-8655, Japan

Attention:              General Manager

Facsimile:               +81-3-5520-3517

 

With a copy (which will notconstitute notice) to:

 

Sojitz Corporationof America

1211 Avenue ofthe Americas

New York, NewYork 10036

Attention:              Legal Department

Facsimile:               (212) 704-6935

 

All such notices and other communicationswill be effective when received.

 

12.           **Interpretation**. The Parties haveparticipated jointly in the negotiation and drafting of this Agreement. If anambiguity or question of intent or interpretation arises, this Agreement willbe construed as if drafted jointly by the Parties and no presumption or burdenof proof will arise favoring or disfavoring any Party because of the authorshipof any provision of this Agreement.

 

13.           **Assignment**. This Agreement will bebinding upon, inure to the benefit of and be enforceable by the respectivesuccessors and permitted assigns of the Parties. This Agreement may not beassigned or otherwise transferred by Buyer or General Moly without the priorwritten consent of the other Party; *provided*that Buyer may, without the consent of General Moly, assign its rights andobligations under this Agreement to an Affiliate of Buyer. Buyer herebyacknowledges that any proposed assignment by Buyer to any other Party, byoperation of law or otherwise, is subject to General Moly’s consent, which willbe in General Moly’s sole discretion and may be conditioned upon amendment tothe payment terms set forth herein.

 

14.           **Relationship of the Parties**. It isunderstood that each Party is conducting business as a separate and distinctlegal entity. Under no circumstances will either Party, its agents and/oremployees be considered agents, partners, representatives or employees of the 

 

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other Party.Neither Party will have the right to act as the legal representative of theother Party or to bind such other Party in any respect whatsoever or to incurany debts or liability in the name of or on behalf of such other Party. ThisAgreement creates no relationships of joint venturers, partners, associates orprincipal and agent between the Parties.

 

15.           **Severability**. The provisions of this Agreementwill be deemed severable and the invalidity or unenforceability of anyprovision will not affect the validity or enforceability of the otherprovisions hereof; *provided* thatif any provision of this Agreement, as applied to any Party or to any circumstance,is adjudged by a governmental body, arbitrator, or mediator not to beenforceable in accordance with its terms, the Parties agree that thegovernmental body, arbitrator, or mediator making such determination will havethe power to modify the provision in a manner consistent with its objectivessuch that it is enforceable, and/or to delete specific words or phrases, and inits reduced form, such provision will then be enforceable and will be enforced.

 

16.           **Taxes and Expenses**. Except as expresslyprovided herein and without modifying or otherwise limiting the paymentobligations of the Parties pursuant to “CIF” deliveries as set forth herein,each Party will be responsible for payment of all taxes, if any, imposed uponit by applicable law in connection with this Agreement; provided, that (a) GeneralMoly will bear all taxes and expenses imposed on it, in connection with thisAgreement or the Products, prior to delivery of the Products pursuant to Section 4.1,including any mining, mineral, export or related taxes, and (b) Buyer willbear all taxes and expenses imposed on it in connection with this Agreement orthe Products, after such delivery, including any import taxes to Japan orKorea. Each Party will pay all of its own administrative expenses, includingthe fees and expenses of its counsel and other agents and representatives,incurred in connection with the preparation, execution and performance of thisAgreement.

 

17.           **Currency**. All references to dollars oramounts of money in this Agreement are references to United States Dollars.

 

18.           **Counterparts; Facsimile Signatures**.This Agreement may be executed in two counterparts, and each such counterpartwill be deemed to be an original instrument, but all such counterparts togetherwill constitute but one agreement. This Agreement may be executed by facsimilesignatures.

 

19.           **Entire Agreement**. This Agreement,including the attached Exhibits which are hereby incorporated herein by thisreference, constitutes the entire agreement and understanding of the Parties inrespect of its subject matter and supersedes all prior understandings,agreements, or representations by or among the Parties, written or oral, to theextent they relate in any way to the subject matter hereof.

 

20.           **Amendment**. No amendment, modificationor addition to this Agreement will be effective unless it is in writing andexecuted by both Parties.

 

21.           **Arbitration**.

 

21.1         Good Faith Negotiation.In the event of any dispute, claim or controversy (except with respect toassaying issues as set forth in Section 4.3) (a “***Dispute***”) arising outof or in connection with this Agreement, a Party may deliver written notice tothe other Party of such 

 

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Disputerequesting to resolve such Dispute pursuant to this Agreement. Upon delivery ofsuch notice, members of senior management of each Party will meet as promptlyas practicable in a good faith attempt to resolve such Dispute.

 

21.2         Binding Arbitration.

 

21.2.1      If a Dispute is not resolved pursuant to Section 21.1by the Parties within thirty (30) days of the delivery of written noticethereof (or such longer period as the Parties may mutually agree), either Partymay make a written demand for binding arbitration in accordance with this Section 21.2.The Dispute will then be submitted to and resolved by binding arbitration inaccordance with the Rules of Arbitration of the International Chamber ofCommerce by an Arbitral Tribunal appointed in accordance with such Rules. Thearbitration will be conducted in New York, New York. The Arbitral Tribunalshall comprise three arbitrators. Each of General Moly and Buyer will appointone arbitrator. The two arbitrators so appointed will together appoint thethird arbitrator. if Buyer or General Moly fails to choose an arbitrator withinfourteen (14) days after receiving notice of commencement of arbitration, or ifthe two arbitrators fail to choose a third arbitrator within fourteen (14) daysafter their appointment, the Court of Arbitration of the International Chamberof Commerce shall upon the request of Buyer or General Moly appoint thearbitrator(s) to complete the Arbitral Tribunal. The arbitration will begoverned in accordance with (i) the provisions of this Agreement and (ii) thegoverning law as specified in Section 10.

 

21.2.2      The arbitration shall be conducted in English,and all documents delivered or produced pursuant to the arbitration shall be inEnglish. The Parties will provide to the arbitrators all information pertainingto the dispute that the arbitrators may request, provided that all informationsupplied by any Party will be deemed to be confidential, and the arbitratorsand other participants in the dispute will protect such information fromdisclosure to the same extent as provided in Section 8.

 

21.2.3      The arbitrators will be instructed to render adecision within sixty (60) days after selection and will be required to statein writing the reasoning on which the decision and any award rests. Thearbitrators will have the power to award counsel fees and expenses, as well asdispute resolution costs (including any fee for the arbitrators), to theprevailing Party. Judgment upon the award rendered may be entered in any courthaving jurisdiction or application may be made to such court for a judicialacceptance of the award and an order of enforcement, as the case may be. Thearbitrators will not award any consequential, incidental, indirect, special,punitive or exemplary damages hereunder or in connection herewith. Thearbitration award shall be final and binding upon the Parties to sucharbitration and may be enforced in any court having jurisdiction.

 

21.2.4      The performance of this Agreement shall not besuspended, cease or be delayed by the reference of a Dispute to arbitration.

 

21.3         Limitations.Notwithstanding anything contained in this Section 21, all disputesregarding Assay Adjustments will be resolved in accordance with Section 4.3.In addition, nothing contained in this Section 21 will prohibit orlimit any Party from seeking and obtaining 

 

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equitablerelief (including temporary restraining orders and preliminary and permanentinjunctions or stays) to which it would otherwise be entitled from a court ofcompetent jurisdiction.

 

22.           **Limitation of Liability**. UNDER NOCIRCUMSTANCES WILL GENERAL MOLY OR BUYER BE LIABLE FOR CONSEQUENTIAL,INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES HEREUNDER OR INCONNECTION HEREWITH.

 

23.           **Third Party Beneficiaries**. Except asexpressly contemplated by Sections 6.5 and 6.6, there are nothird party beneficiaries having rights under or with respect to thisAgreement.

 

24.           **Remedies Cumulative**. All remediesavailable to the Parties for breach of this Agreement are cumulative and may beexercised concurrently or separately, and the exercise of any one remedy shallnot be deemed an election of such remedy to the exclusion of other remedies.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, Buyer andGeneral Moly have duly executed this Agreement as of the date first abovewritten.

 
|   | GENERAL  MOLY, INC. |
|--------|---------------------|
|   |                |   |
|   |                |   |
|   | By:                 |   | /s/ Bruce D.  Hansen |
|   | Name:               | Bruce D.  Hansen |
|   | Title:              | Chief  Executive Officer |
|   |                |   |
|   |                |   |
|   | SOJITZ  CORPORATION |
|   |                |   |
|   |                |   |
|   | By:                 |   | /s/  Kazuyoshi Shioda |
|   | Name:               | Kazuyoshi  Shioda |
|   | Title:              | General  Manager, Ferroalloys Dept. |

 

[SignaturePage to Molybdenum Supply Agreement]

 

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Exhibit A

 

Specifications

 

**SPECIFICATIONMOLYBDENUM OXIDE**

** **
| ***Mo***             | [****] |
|----------------------|--------|
|                 |   |
| ***Cu***             | [****] |
|                 |   |
| **S**                | [****] |
|                 |   |
| ***C***              | [****] |
|                 |   |
| ***P***              | [****] |
|                 |   |
| ***Si***             | [****] |
|                 |   |
| ***Pb***             | [****] |
|                 |   |
| ***Zn***             | [****] |
|                 |   |
| ***Other elements*** | [****] |

 

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Exhibit B

 

ExistingObligations

 
| **Name of Purchaser** | ** ** | ***Quantity  of TMO per Month/Year** | ** ** | ****Term  of Supply Obligation** |
|-----------------------|------------|--------------------------------------|------------|----------------------------------|
|                  |       |                                 |       |                             |
| [****]                |       | [****]                               |       | [****]                           |

 

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*              All quantities are listed in terms ofmolybdenum units regardless of gross weight.

 

**           General Moly shall promptly notify Buyer ofthe date of first supply.

 

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