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Item 1.01
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Entry into a Material Definitive Agreement
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Offering and
Private Placement Transaction
On April 20, 2020,
Golden Minerals Company (the “Company”), a Delaware corporation, entered into a Securities Purchase Agreement with
certain institutional investors (the “Securities Purchase Agreement”) providing for the issuance and sale by the Company
in a registered direct offering (the “Offering”) of 15,000,000 shares of common stock at a purchase price of $0.20
per share (the “Offering Shares”), and in a concurrent private placement transaction, the issuance of an aggregate
of 11,250,000 warrants ultimately consisting of (i) 7,500,000 Series A warrants (the “Series A Warrants”) to purchase
7,500,000 shares of the Company’s common stock and (ii) 3,750,000 Series B warrants (the “Series B Warrants”
and, together with the Series A Warrants, the “Warrants”) to purchase 3,750,000 shares of the Company’s common
stock, at an exercise price of $0.30 per share (the “Private Placement”). The Warrants represent 75% of the Offering
Shares. Aggregate gross proceeds to the Company is $3.0 million.
The Offering Shares
are registered pursuant to the Company’s registration statement on Form S-3 (File No. 333-220461), and
a prospectus supplement thereto filed with the Securities and Exchange Commission (“SEC”) on April 21, 2020.
The Securities Purchase Agreement contains customary representations, warranties and covenants, in addition to granting the investor
parties thereto a participation right whereby they have the right to collectively participate in up to 50% of any future offerings
of securities by the Company, other than certain “exempt issuances” and “permitted sales” as defined therein,
until the first anniversary of the closing date of the Offering.
The Warrants were offered
and sold without registration under the Securities Act of 1933, as amended (the “Act”), in reliance on the exemptions
provided by Section 4(a)(2) of the Act and/or Regulation D promulgated thereunder. Each Warrant is exercisable six
months from the date of issuance and has a term expiring five years after such initial exercise date. The
Warrants contain so-called full-ratchet anti-dilution
provisions which may be triggered upon any future issuance by the Company of shares of its common stock or common stock equivalents
at a per share price below the then-exercise price of the Warrant, subject to certain exceptions; provided, however,
that with respect to the Series B Warrants, the adjusted exercise price will not be less than $0.26.
A.G.P./Alliance Global
Partners (“A.G.P.”) acted as the sole placement agent in connection with the Offering and Private Placement. A.G.P.
agreed to use its reasonable best efforts to arrange for the sale of the Offering Shares and Warrants (together, the “Securities”).
A.G.P. was paid a cash fee equal to six percent (6%) of the aggregate gross proceeds received by the Company from the sale of the
Securities at the closing of the Offering and Private Placement; provided, however, that A.G.P. accepted a reduced fee with
respect to an investor. A.G.P. also received approximately $45,000 for reimbursement of its expenses upon closing of the Offering.
In connection
with the Offering, the Company, its directors, executive officers, and certain stockholders entered
into lock-up agreements. Under these agreements, such parties are, subject to certain exceptions, not to sell or
transfer any shares of common stock or securities convertible into, or exchangeable or exercisable for, the Company’s
shares of common stock during a period ending 90 days after the closing of the Offering, without first obtaining the written
consent of A.G.P.
The Company intends
to use the proceeds from the Offering and Private Placement for working capital requirements and general corporate purposes.
The Offering and concurrent
Private Placement closed on April 22, 2020.