America West Resources, Inc., a domestic coal producer with mining operations in Central Utah, announced that it has entered into a loan agreement that provides for up to $2.8 million of funding pending the entry of a final confirmation order allowing its wholly owned subsidiary, Hidden Splendor, to emerge from bankruptcy.
The $2.8 million one-year term loan will be secured by the Company’s undeveloped leasehold known as “Columbia,” a 5,200 acre property in Carbon County, Utah. The loan will bear interest at a fixed rate of 17% per annum. The proceeds will be largely used to satisfy certain creditor repayment terms and conditions set forth by Hidden Splendor’s plan of reorganization. Additionally, upon final confirmation, the investors have agreed upon purchase of 10 million shares of America West Resources’ common stock for $200,000.
Dan Baker, America West’s Chief Executive Officer, stated, “This financing marks another key step forward in America West’s efforts to achieve Hidden Splendor’s emergence from bankruptcy, at which time we will be free to focus exclusively on accelerating our expansion initiatives and capitalizing on the prevailing global demand for our clean coal.”
Headquartered in Salt Lake City, Utah, America West Resources, Inc. is an established domestic coal producer focused on the mining of clean and compliant (low-sulfur) coal and its sale primarily to U.S. utility companies for use in generating electricity. Since 2003, the Company has extracted over 1.3 million tons of coal from its owned and operated Horizon Coal Mine based in Central Utah. For more information, please visit www.AmericaCoal.com .