Document:

exv10w1

 

Exhibit 10.1

ADVANCE SALES RESTRUCTURING AGREEMENT

     This Advance Sales Restructuring Agreement (the “Agreement”) is entered into as of April 23rd,
2007, by and between Golden Phoenix Minerals, Inc., a Minnesota corporation (the “Company”) and
William D. or Candida Schnack (collectively “Schnack”). Both the Company and Schnack may
sometimes be referred to as a “Party” or collectively as the “Parties.”

     WHEREAS, the Company and Schnack entered into that certain “GOLDEN PHOENIX/SCHNACK AGREEMENT
for Advance On Sales Of Molybdenum Concentrates,” executed by Schnack on May 6, 2005 and by the
Company on May 10, 2005, as amended from time to time (the Schnack Agreement”); and

     WHEREAS, in order to facilitate the Company’s efforts to raise equity capital from
institutional investors (the “Equity Financing”), the Company and Schnack desire to restructure the
Schnack Agreement, to be effective upon the Closing of the Equity Financing, to provide for an
early payment of $1 million, paid two hundred fifty thousand dollars ($250,000) promptly after
Closing and seven hundred fifty thousand dollars ($750,000) within forty five days of Closing, and
the restructuring of the remaining amounts owed under the Schnack Agreement into a Net Smelter
Returns payment from the Company’s distributions from the Ashdown Project LLC, the owner of the
Ashdown Molybdenum Mine located near Denio, Nevada; the exercise of Schnack’s warrants to purchase
the Company’s Common Stock issued to Schnack pursuant to the Schnack Agreement (the “Schnack
Warrants”), and the registration of the shares underlying the Schnack Warrants with the Securities
and Exchange Commission (“SEC”);

     NOW THEREFORE, in consideration for the mutual promises set forth in this Agreement, and for
other valuable consideration the receipt of which is hereby acknowledged, the Parties agree,
effective upon the Closing of the Equity Financing, as follows:

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ARTICLE 1

RESTRUCTURING OF AMOUNTS OWED UNDER THE SCHACK AGREEMENT

     1.1 Cash Payment Upon Close of Equity Financing. Promptly after the Closing of the
Equity Financing, the Company shall pay Schnack the sum of two hundred fifty thousand dollars
($250,000.00) which shall be credited against the amounts owed to Schnack under the Schnack
Agreement. Within forty five (45) days of the Closing of the Equity Financing, the Company shall
pay Schnack the sum of seven hundred fifty thousand dollars ($750,000) which shall be credited
against the amounts owed to Schnack under the Schnack Agreement. Failure of the Company to pay the
full amounts owed to Schnack under this Section 1.1 within the time frames set forth herein shall
constitute a default by the Company and, at Schnack’s option, upon three (3) business days written
notice of default, all amounts due under this Section 1.1 together with the entire production
payment provided for in Section 1.2, less any amounts previously paid under Section 1.2, shall
accelerate and become immediately due and payable by the Company.

     1.2 Production Payment from the Ashdown Mine. The remaining amounts owed to Schnack
under the Schnack Agreement shall be paid from a production payment in the amount of two million
dollars ($2,000,000.00) paid exclusively from the Company’s share of production of base and
precious minerals produced from the Ashdown Mine allocated to the Company pursuant to the Ashdown
Project LLC. The rate of payment shall be equal to a fifteen percent (15%) Net Smelter (Refinery)
Return on the entire production of precious and base minerals produced from the Ashdown Mine.
Until the production payment is paid by the Company in full, the Company shall provide Schnack with
monthly reports in writing reporting production and sales of minerals, both precious and base, from
the Ashdown Mine and the calculation of the production payment to be paid by the Company. The
production payment shall be paid to Schnack monthly by the end of the month following the month the
production occurs. Schnack shall be entitled to a default interest rate on any accrued unpaid
production payment equal to fifteen percent (15%) per annum simple interest. Notwithstanding
anything else in this Agreement to the contrary, the Company, or its assignee, has the option to
purchase the production payment provided for in this Section 1.2 for the following amounts during
the time periods set forth below:

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	 	1.2.1	 	On or prior to August 31, 2007. The Company, or its
assignee, has the option to purchase the production payment for one million
three hundred thousand dollars ($1,300.000.00), less any amounts already paid
pursuant to this Section 1.2, if written notice of the exercise of the
option is given on or before August 31, 2007, and the purchase price is paid
within ten (10) business days from the notice of exercise.
	 
	 	1.2.2	 	Between September 1, 2007 and December 31, 2007. The
Company, or its assignee, has the option to purchase the production payment for
one million five hundred thousand dollars ($1,500,000.00), less any amounts
already paid pursuant to this Section 1.2, if written notice of the exercise of
the option is given between September 1, 2007, and December 31, 2007, and the
purchase price is paid within ten (10) business days from the notice of
exercise.
	 
	 	1.2.3	 	After December 31, 2007. The Company, or its
assignee, has the option to purchase the production payment for two million
dollars ($2,000,000.00), less any amounts already paid pursuant to this Section
1.2, if written notice of the exercise of the option is given after April1,
2008, and the purchase price is paid within ten (10) business days from the
notice of exercise.
	 
	 	1.2.4	 	Assignment of Option and Adjustment to Production
Payment. If, and only if, the Company assigns its option to purchase the
production payment provided for herein, then the following modifications to the
production payment shall be made automatically immediately prior to the
exercise of the option by the assignee:

	 	1.2.4.1	 	Adjustment to Size of Production Payment. The aggregate
amount of the production payment shall be equal to one hundred ten
percent (110%) of the amount of the exercise price of the option, but
in no case shall it exceed two million dollars ($2,000,000.00) less any
amounts already paid pursuant to this Section 1.2. The production
payment shall be paid in an amount equal to a five percent (5%) Net
Smelter (Refinery) Returns instead of the fifteen

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	 	 	 	percent (15%) Net
Smelter (Refinery) Returns provided for in Section 1.2 above and paid
solely from the Company’s share of production distributed to the
Company pursuant to the Ashdown Project LLC.
	 
	 	1.2.4.2	 	Convertibility of the Production Payment into Shares of Company
Common Stock. So long as the production payment remains
outstanding, the production payment shall be convertible into shares of
the Company’s Common Stock at the option of the holder of the
production payment. The number of shares of the Company’s Common Stock
to be issued upon conversion of the production payment shall be
calculated by dividing the remaining amount of the production payment
by a number derived by multiplying the volume weighted average price
(“VWAP”) of the Company’s Common Stock for a period of ten (10) trading
days prior to exercise of this conversion right by 0.80, but in no case
less than $0.30 per share. Unless specifically agreed otherwise by the
Company in a separate registration rights agreement, shares issued upon
the conversion of the production payment shall constitute “restricted
securities” as defined in SEC Rule 144 and will be issued, and the
conversion of the production payment will be conditioned by, an
exemption from the registration requirements of the Securities Act of
1933, as amended. Conversion of the production payment shall also be
conditioned upon an increase in the authorized capital of the Company
at a meeting of the Company’s shareholders.

     1.3 Exercise and Registration of the Share of Common Stock Underlying the Schnack
Warrants. Schnack agrees to exercise all of the Schnack Warrants purchasing an aggregate of
one million one hundred ninety three thousand one hundred seventy seven (1,193,177) shares of the
Company’s Common Stock at an exercise price of $0.14 per share. The Company agrees to pay Schnack
the sum of $167,044.78 pursuant to Section 1.2 of this Agreement as a payment of

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accrued unpaid
payments due Schnack prior to the date of this Agreement and Schnack agrees to pay this payment to
the Company as the exercise price of the Schnack Warrants. The Company shall use its reasonable
best efforts to include the shares purchased by Schnack upon the exercise of the Schnack Warrants
on the registration statement to be filed with the SEC in connection with the Equity Financing
within thirty (30) days from the Closing of the Equity Financing.

     1.4 Sale of Certain Mining Equipment. The Company shall use its commercially
reasonable efforts to sell the mining equipment described on Exhibit “A” to this Agreement (the
“Equipment”) and to apply one hundred percent of the net proceeds from the sale of the Equipment to
the amounts owed to Schnack under this agreement in the following priority:

	 	1.4.1	 	Amounts Owed Under Section 1.1. First, the net
proceeds from the sale of the Equipment shall be applied to any amounts owed
under Section 1.1 of this Agreement;
	 
	 	1.4.2	 	Amounts Owed Under Section 1.2. Any net proceeds from
the sale of the Equipment remaining after the amount, if any, is allocated to
the amounts owed under Section 1.1 of this Agreement shall be applied to any
amounts owed under Section 1.2 of the Agreement;
	 
	 	1.4.3	 	Prepayment of Production Payment. Any net proceeds
from the sale of the Equipment remaining after the amount, if any, is allocated
to the amounts owed under Sections 1.1 and 1.2 of this Agreement shall be paid
to Schnack as a credit against the remaining amount of the production payment
that is not yet due and owing under the provisions of Section 1.2.
	 
	 	1.4.4	 	Use of Proceeds as Option Payment. Notwithstanding
anything else to the contrary in this Section 1.4, after any amounts owed to
Schnack under Section 1.1 have been paid, the remaining net proceeds from the
sale of the Equipment may be used as part of the exercise price for the
purchase of the production payment provided for in Section 1.2.1and 1.2.4
inclusive.

     1.5 Amendment of the Schnack Agreement. This Agreement amends and supersedes the
terms and conditions of the Schnack Agreement.

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ARTICLE 2

DEFINITIONS

     The following definitions shall apply to the terms and conditions of this Agreement:

     2.1 Net Smelter Returns. Net Smelter Returns for all purposes of this Agreement shall
mean the amount actually received by the Ashdown Project LLC from any sale of Ores and Minerals
mined or otherwise recovered and removed from the Ashdown Mine less, but only to the extent
actually incurred and borne by the Ashdown Project LLC:

     2.1.1 Sales, use, gross receipts, severance, and other taxes, if any, payable with
respect to severance, production, removal, sale or disposition of Ores and Minerals, but
excluding any taxes on net income;

     2.1.2 Brokerage fees and sales commissions, if any;

     2.1.3 Charges and costs, if any, for transportation from the mine or mill to places
where Ores and Minerals are smelted, refined, processed and/or sold; and

     2.1.4 Charges, costs, including assaying and sampling costs, and all penalties, if any,
incurred upon smelting, refining, or processing Ores and Minerals; in the event smelting,
refining, or processing is carried out in facilities owned or controlled by the Ashdown
Joint Venture, charges, costs, and penalties for such operations shall mean the amount the
Ashdown Joint Venture would have incurred if such operations were carried out at facilities
not owned or controlled by the Ashdown Joint Venture then offering comparable services for
comparable products on prevailing terms.

     2.2 Ores and Minerals. Ores and Minerals for all purposes of this Agreement shall
mean collectively Ores and Minerals as defined below:

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     2.2.1 Minerals. Minerals, whether singular or plural, shall mean any and all
mineral substances of any nature, metallic or non-metallic, including, but not limited to,
molybdenite. The term Minerals shall not include oil, gas, or other liquid or gaseous
hydrocarbon substances, or sand, gravel, aggregates or building stone.

     2.2.2 Ores. Ores, whether singular or plural, shall mean all material which in
the sole discretion of the Ashdown Project LLC justifies either (i) mining, extracting, or
recovering from place in the Ashdown Mine and selling or delivering to a processing plant
for physical or chemical treatment, or (ii) treating in place in the Ashdown Mine by
chemical, solution, or other methods; said term shall also include all mineral-bearing
solutions, natural or introduced, recovered by the Ashdown Project LLC from the Ashdown Mine
and sold or processed by the Ashdown Project LLC, and all mineral and non-mineral components
of all such material and solutions.

ARTICLE 3

MISCELLANEOUS PROVISIONS

     3.1. Successors and Assigns. Except as otherwise provided for in Section 1.2 of this
Agreement, this Agreement may not be assigned by a Party hereto without the prior written consent
of the Company or Schnack, as applicable, provided, however, that a Party may assign its rights and
delegate its duties hereunder in whole or in part to an Affiliate of the Party without the prior
written consent of the Company or Purchaser, after notice duly given by such Party to the other
Party. The provisions of this Agreement shall inure to the benefit of and be binding upon the
respective permitted successors and assigns of the Parties. Nothing in this Agreement, express or
implied, is intended to confer upon any person or entity other than the Parties hereto or their
respective successors and assigns any rights, remedies, obligations, or liabilities under or by
reason of this Agreement, except as expressly provided in this Agreement.

     3.2. Counterparts; Faxes. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute

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one and the
same instrument. This Agreement may also be executed via facsimile, which shall be deemed an
original.

     3.3. Titles and Subtitles. The titles and subtitles used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting this Agreement.

     3.4 Notices. Unless otherwise provided, any notice required or permitted under this
Agreement shall be given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon such delivery, (ii)
if given by telex or telecopier, then such notice shall be deemed given upon receipt of
confirmation of complete transmittal, (iii) if given by mail, then such notice shall be deemed
given upon the earlier of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by an internationally
recognized overnight air courier, then such notice shall be deemed given one Business Day after
delivery to such carrier. All notices shall be addressed to the party to be notified at the
address as follows, or at such other address as such party may designate by ten days’ advance
written notice to the other party:

	 	 	 	 	 	 	 
	 	 	If to the Company:	 	Golden Phoenix Minerals, Inc.
	 

	 	 	 	 	 	1675 East Prater Way, Suite 102
	 

	 	 	 	 	 	Sparks, NV 89434
	 

	 	 	 	 	 	Attention: David A. Caldwell
	 

	 	 	 	 	 	Fax: 775-853-5010
	 
	 	 	 	 	 	 
	 	 	With a copy to:	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	Bullivant Houser Bailey, PC
	 	 	 	 	1415 L Street, Suite 1000
	 	 	 	 	Sacramento, CA 95814
	 	 	 	 	Attention: Scott E. Bartel, Esq.
	 	 	 	 	Fax: (916) 930-2513
	 
	 	 	 	 	 	 
	 	 	If to Schnack:	 	9538 Hollow Creek Way
	 

	 	 	 	 	 	Elk Grove, CA 95624
	 

	 	 	 	 	 	Fax: (916) 686-4865

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     3.5. Amendments and Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written consent of the Company
and Schnack.

     3.6. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof but shall
be interpreted as if it were written so as to be enforceable to the maximum extent permitted by
applicable law, and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the Parties hereby waive any provision of law which renders any
provision hereof prohibited or unenforceable in any respect.

     3.7. Entire Agreement. This Agreement constitutes the entire agreement among the
Parties hereof with respect to the subject matter hereof and thereof and supersede all prior
agreements and understandings, both oral and written, between the Parties with respect to the
subject matter hereof and thereof.

     3.8. Further Assurances. The Parties shall execute and deliver all such further
instruments and documents and take all such other actions as may reasonably be required to carry
out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein
contained.

     3.9. Governing Law; Consent to Jurisdiction. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of California without regard to the
choice of law principles thereof. Each of the Parties hereto irrevocably submits to the exclusive
jurisdiction of the courts of the State of California located in Sacramento County and the United
States District Court for the Eastern District of California for the purpose of any suit, action,
proceeding or judgment relating to or arising out of this Agreement and the transactions
contemplated hereby. Service of process in connection with any such suit, action or proceeding

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may
be served on each Party hereto anywhere in the world by the same methods as are specified for the
giving of notices under this Agreement (other than by telex or facsimile which shall be deemed
improper service). Each of the Parties hereto irrevocably consents to the jurisdiction of any such
court in any such suit, action or proceeding and to the laying of venue in such court. Each Party
hereto irrevocably waives any objection to the laying of venue of any such suit, action or
proceeding brought in such courts and irrevocably waives any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum

          IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the day and year
first written above.

	 	 	 	 	 
	 	GOLDEN PHOENIX MINERALS, INC.

 	 
	 	/s/ David A. Caldwell
 	 
	 	David A. Caldwell, CEO 	 
	 	 	 
	 
	 	SCHNACK

 	 
	 	/s/ William D. Schnack
 	 
	 	William D. Schnack 	 
	 	 	 
	 
	 	 	 
	 	     /s/ Candida Schnack
 	 
	 	Candida Schnack 	 
	 	 	 
	 

10exv10w2

 

Exhibit 10.2

MUTUAL TERMINATION AGREEMENT

     MUTUAL TERMINATION AGREEMENT (the “Agreement”), dated as of April 23, 2007, by and between
GOLDEN PHOENIX MINERALS, INC., a Minnesota corporation, (the “Company”), and FUSION CAPITAL FUND
II, LLC, an Illinois limited liability company (the “Buyer”).

     WHEREAS, the Buyer and the Company mutually desire to terminate the Common Stock Purchase
Agreement dated as of January 20, 2006, by and between the Company and the Buyer (the “Purchase
Agreement”) in connection with a $6 million capital raise by the Company in a private placement to
institutional and accredited investors (the “Private Placement”). Attached hereto as Exhibit “A”
is the Company’s written notice of termination pursuant to Section 11(k) of the Purchase Agreement.
All capitalized terms used in this Agreement that are not defined in this Agreement shall have the
meanings set forth in the Purchase Agreement;

     NOW THEREFORE, the Company and the Buyer hereby agree as follows:

     1. TERMINATION OF THE PURCHASE AGREEMENT.

     The Purchase Agreement, and the other Transaction Documents between the Buyer and the Company
related to the Purchase Agreement (other than this Agreement, that certain Registration Rights
Agreement between the Company and Buyer dated January 20, 2006, the “Registration Rights
Agreement”) are hereby terminated effective as of the date hereof and any and all rights, duties
and obligations arising thereunder or in connection with the Purchase Agreement, and the
Transaction Documents (other then the Registration Rights Agreement and this Agreement) are now and
hereafter fully and finally terminated, provided, however, that (i) the representations and
warranties of the Buyer and Company contained in Sections 2 and 3 of the Purchase Agreement, (ii)
the indemnification provisions set forth in Section 8 of the Purchase Agreement, (iii) the
agreements and covenants set forth in Section 11 of the Purchase Agreement, including, but not
limited to, the Company’s and the Buyer’s obligations with respect to any pending purchases of
Common Stock under the Purchase Agreement, (iv) the Registration Rights Agreement, and (v) that
certain Termination Agreement between the Buyer and the Company dated as of January 19, 2006, and
the “Surviving Obligations” set forth therein, shall survive such termination and shall continue in
full force and effect (the “Surviving Obligations”).

     2. MUTUAL GENERAL RELEASE.

     Except as may arise under or in connection with this Agreement and the Surviving Obligations,
the Company and the Buyer hereby release and forever discharge each party hereto and its
predecessors, successors and assigns, employees, shareholders, partners, managing members,
officers, directors, agents, subsidiaries, divisions and affiliates from any and all claims, causes
of actions, suits, demands, debts, dues, accounts, bonds, covenants, contracts, agreements,
judgments whatsoever in law or in equity, whether known or unknown, including,

 

 

but not limited
to, any claim arising out of or relating to the transactions described in the Purchase Agreement
and Transaction Documents (other than the Registration Rights Agreement or the Surviving
Obligations) which any party hereto had, now has or which its heirs, executors, administrators,
successors or assigns, or any of them, hereafter can, shall or may have, against any party hereto
or such parties predecessors, successors and assigns, employees, shareholders, partners, managing
members, officers, directors, agents, subsidiaries, divisions and affiliates, for or by reason of
any cause, matter or thing whatsoever, whether arising prior to, on or after the date hereof,
provided, however, that (i) this Agreement, (ii) the Surviving Obligations including, but not
limited to, the Registration Rights Agreement, shall continue in full force and effect as the
legal, valid and binding obligation of each party thereto enforceable against each such party in
accordance with its terms.

     3. MISCELLANEOUS.

     (a) Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of Illinois, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of Illinois or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of Illinois. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts
sitting in the City of Chicago, for the adjudication of any dispute hereunder or under the other
Transaction Documents or in connection herewith or therewith, or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue
of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under this Agreement and
agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

     (b) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall be binding upon the
signatory thereto with the same force and effect as if the signature were an original, not a
facsimile signature.

     (c) Headings. The headings of this Agreement are for convenience of reference and
shall not form part of, or affect the interpretation of, this Agreement.

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     (d) Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity
or enforceability of any provision of this Agreement in any other jurisdiction.

     (e) Notices. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and will be deemed to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by
facsimile (provided confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Trading Day after deposit with a nationally
recognized overnight delivery service, in each case properly addressed to the party to receive the
same. The addresses and facsimile numbers for such communications shall be:

	 	 	 	 	 	 	 
	 	 	If to the Company:
	 	 	 	 	Golden Phoenix Minerals, Inc.
	 	 	 	 	1675 E. Prater Way, Suite 102
	 	 	 	 	Sparks, Nevada 89434
	 

	 	 	 	Telephone:
	 	775-853-4919
	 

	 	 	 	Facsimile:
	 	775-853-5010
	 

	 	 	 	Attention:
	 	Robert Martin
	 
	 	 	 	 	 	 
	 	 	If to the Buyer:
	 	 	 	 	Fusion Capital Fund II, LLC
	 	 	 	 	222 Merchandise Mart Plaza, Suite 9-112
	 	 	 	 	Chicago, IL 60654
	 

	 	 	 	Telephone:
	 	312-644-6644
	 

	 	 	 	Facsimile:
	 	312-644-6244
	 

	 	 	 	Attention:
	 	Steven G. Martin

or at such other address and/or facsimile number and/or to the attention of such other person as
the recipient party has specified by written notice given to each other party three (3) Trading
Days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender’s facsimile machine containing the time, date, and recipient
facsimile number or (C) provided by a nationally recognized overnight delivery service, shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above,
respectively.

     (f) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns. The Company shall not assign
this Agreement or any rights or obligations hereunder without the prior written consent of the
Buyer, including by merger or consolidation. The Buyer may not assign its rights or obligations
under this Agreement.

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     (g) No Third Party Beneficiaries. This Agreement is intended for the benefit of the
parties hereto and their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other person.

     (h) Further Assurances. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may reasonably request in
order to carry out the intent and accomplish the purposes of this Agreement.

     (i) No Strict Construction. The language used in this Agreement is the language
chosen by the parties to express their mutual intent, and no rules of strict construction will be
applied against any party.

     (j) Changes to the Terms of this Agreement. This Agreement and any provision hereof
may only be amended by an instrument in writing signed by the Company and the Buyer. The term
“Agreement” and all reference thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as so amended or
supplemented.

     (k) Failure or Indulgence Not Waiver. No failure or delay in the exercise of any
power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further exercise thereof
or of any other right, power or privilege.

*       *       *       *

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     IN WITNESS WHEREOF, the Buyer and the Company have caused this Mutual Termination Agreement to
be duly executed as of the date first written above.

	 	 	 	 	 	 	 	 	 
	 	 	THE COMPANY:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	GOLDEN PHOENIX MINERALS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Robert Martin	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Robert Martin	 	 
	 	 	Title:	 	President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BUYER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	FUSION CAPITAL FUND II, LLC	 	 
	 	 	BY: FUSION CAPITAL PARTNERS, LLC	 	 
	 	 	BY: ROCKLEDGE CAPITAL CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Josh Scheinfeld	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Josh Scheinfeld	 	 
	 	 	Title:	 	President	 	 

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EXHIBIT “A”

WRITTEN NOTICE OF TERMINATION

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April 23, 2007

VIA CERTIFIED MAIL

Fusion Capital Fund II, LLC

222 Merchandise Mart Plaza, Suite 9-112

Chicago, IL 60654

Attn: Steven G. Martin

     Re:     NOTICE OF TERMINATION

Dear Mr. Martin:

     Pursuant to that certain Common Stock Purchase Agreement by and between Golden Phoenix
Minerals, Inc. (the “Company”) and Fusion Capital Fund II, LLC (“Fusion”) (the “Agreement”), the
Company is hereby providing notice that as of April 23, 2007, the Agreement is hereby
terminated in accordance with Section 11(k)(v) thereto. Hence, Fusion must refrain from making any
further purchases of the Company’s common stock under the Agreement and as registered on Form SB-2,
as amended (SEC File No. 333-131226).

     Should you have any questions, please contact our attorney, Scott E. Bartel, at (916)
930-2513.

	 	 	 	 	 
	 	Very truly yours,

/s/
Robert A. Martin

Robert A. Martin,

President

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