Second Amendment to the Golden Phoenix/Schnack Agreement
This letter will supercede the terms outlined in Paragraph 7 of the Golden Phoenix/Schnack Agreement: For the Advance on Sales of Molybdenum Concentrates (Agreement), and will replace and terminate the Letter of Extension (First Amendment) signed 11/4/05 in its entirety. Paragraph 7 of the Agreement reads as follows:
The advance amount ($1,000,000) and premium payment ($2,000,000) will be paid in monthly installments as follows:
| a) | 15% of gross molybdenum concentrates sales produced from the Ashdown Mine |
| on the first of every month starting when production begins. |
| b) | Beginning on October 1, 2005, a minimum payment of $500,000 or 15% or the |
| gross, whichever is greater is due and payable on the first of every month |
| thereafter until both the advance and premium are retired in full. |
| c) | The final payment will be due and payable February 1, 2006. |
Golden Phoenix and William and Candida Schnack at this time wish to change the Agreement to read the following:
The advance amount ($1,000,000) and premium payment ($2,000,000) will be paid in monthly installments as follows:
| a) | 5% of gross molybdenum concentrates sales produced from the Ashdown Mine through February 1, 2007 will be due and payable within 30 days of transfer of ownership to broker. |
| b) | Beginning February 1, 2007 15% of gross molybdenum concentrates sales produced from the Ashdown Mine will be due and payable within 30 days of transfer of ownership to broker. |
| c) | Beginning March 1, 2007, a payment of 15% of gross molybdenum concentrates sales produced from the Ashdown Mine, or $300,000, whichever is greater, will be due and payable within 30 days of transfer of ownership to broker. |
| d) | A final payment of all outstanding amounts related to the advance and premium will be due and payable June 1, 2007. |
The parties have read, understood and agreed to the terms of this Second Amendment.
/s/ Kenneth S. Ripley Dated November 1, 2006
Kenneth S. Ripley, CEO Golden Phoenix Minerals, Inc.
/s/ William D. Schnack Dated November 2, 2006
William D. Schnack
/s/ Candida Schnack Dated November 2, 2006
Candida Schnack
