Current Report Filing (8-k)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported):

July 6, 2022

 

Commission File Number

000-31380

 

APPLIED MINERALS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware		82-0096527
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
1200 Silver City Road, PO Box 432, Eureka, UT		84628
(Address of principal executive offices)		(Zip Code)

 

	[phone]
	(Issuer’s Telephone Number, Including Area Code)

 

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (

see

 General Instruction A.2. below):

 

¨

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230-425)

 

¨

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240-14a-12)

 

¨

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

 

Emerging growth company

¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

¨

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

On J

uly

 6, 2022, Applied Minerals, Inc. (“AMI”) and its directors, Brady McCasland, Inc. (“BMI”), BMI Minerals Company (“BMCO”) and the majority holders of the outstanding principal amount of AMI’s Series A Notes and Series 2023 Notes (collectively, the “PIK Notes”) entered into an agreement described below. In consideration of BMI and BMCO agreeing to amend the Iron Sale Agreement, Mill Sale Agreement, Mining Operations Agreement and Milling Operations Agreement (collectively, the “Four Agreements”), entered into among AMI, BMI and BMCO on May 31, 2022, to remove the condition precedent that AMI enter into agreements to eliminate the outstanding balances of the Series A Notes and Series 2023 Notes, the PIK Notes, AMI and its directors agreed to the following:

 

(a) the PIK Notes and AMI will take reasonable actions necessary to protect the interests

of

BMI

and

BMCO

as

described

in

the

Four

Agreements,

including

(i)

providing reasonable assurances in writing to BMI and BMCO that in the event of a future bankruptcy or other legal proceeding against AMI, neither the PIK Notes

nor AMI will take any position or action that adversely affects or could adversely affect the interests of BMI and/or BMCO as described in the Four Agreements, and (ii) not opposing, or taking any action contrary to, any position taken by others that serves to protect the interests of BMI and BMCO as described in the Four Agreements;

 

(b) the PIK Notes will execute and deliver to BMI and BMCO a document prepared

by

the

legal

counsel

of

BMI

and

BMCO

that

is

consistent

with

Section

(a). Up to a total of $20,000 of legal costs incurred by BMI and BMCO to have such document prepared shall be deducted from the remaining purchase price to be paid by BMI and BMCO under the Four Agreements. The holders of the majority of the outstanding principal of the Series A Notes will agree to waive any event of default that is caused or,

that

could

be

caused,

by

the

execution

and/or

the

consummation

of

the

Four

Agreements or the action contemplated thereby (“Series A Waiver”). The holders of the majority of the outstanding principal of the Series 2023 Notes agree to waive any event of default

that is

caused

or,

that

could

be

caused,

by

the

execution

and/or

the

consummation of the Four Agreements or the action contemplated thereby (“2023 Waivers”);

 

(c) Mario Concha, John Levy, Robert Betz and Geoffrey Scott, directors of AMI, have entered into a corporate resolution agreeing,

upon

the

closing

of

the

Four

Agreements,

to

relinquish

payment

of all

accrued but unpaid Board Fees and Operations Committee Fees as those terms are used in AMI’s 2021

Proxy

Statement. Mr. Concha has agreed to relinquish payment of all compensation accrued but not paid during his tenure as CEO of AMI. Messrs. Concha, Levy and Betz, upon the closing of the Four Agreements, hereby resign as directors of AMI;

 

(d) AMI agreed to not use any proceeds received upon the closing of the Four Agreements to pay the accrued but unpaid salaries of former employees and directors of AMI;

 

(e) Upon the closing of the Four Agreements AMI

hereby

limits

the

maximum number of directors elected to its Board of Directors to five;

 

(f) Upon the closing of the Four Agreements, BMI will have the right to nominate, and the Board of Directors of AMI will use its best efforts to appoint or cause the election of a number of directors that is equal to one-third the number of directors of the Board of Directors of AMI.

If the number of directors is not divisible by three (3), the number of directors nominated by BMI will be rounded up to the next whole number. Unanimous approval of the Board will be required to approve (i) the assumption by AMI of any interest

bearing

debt

and

(ii)

fees

paid

to

the

directors

for

Board

and

Committee

service.

 

(g) Upon the closing of the Four Agreement

holders

of

a

majority

of

the

principal

of the Series 2023 Notes hereby waive their rights under the 2023 Director Nomination Agreement to designate one person to be nominated for election to the Board of Directors

of

AMI; and

 

(h) Upon the closing of the Four Agreements, AMI will pay a total of $375,000 to the holders of the majority of the outstanding principal of the Series A Notes in exchange for the Series A Waiver and a total of $375,000 to the holders of the majority of the outstanding principal of the Series 2023 Notes in exchange for the Series 2023 Waiver.

 

 

SIGNATURES

 

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

				APPLIED MINERALS, INC.
Dated:		July 11, 2022		/s/ CHRISTOPHER T. CARNEY
				By: Christopher T. Carney
				President and Chief Executive Officer