Attached files
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| EX-99.1 - NATIONAL COAL CORP | exh99-1a.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 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): April 8, 2010
NATIONAL
COAL CORP.
(Exact
name of registrant as specified in its charter)
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Florida
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0-26509
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65-0601272
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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8915
George Williams Road
Knoxville,
Tennessee 37923
(Address
of Principal Executive Offices/Zip Code)
(865)
690-6900
(Registrant’s
telephone number, including area code)
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):
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange ct (17 CFR
240.14d-2(B))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c)) under the Exchange Act (17 CFR
240.13e-4c))
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Item
1.01.
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Entry
Into a Material Definitive
Agreement
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On April
8, 2010, National Coal Corp. together with our wholly-owned subsidiary, National
Coal Corporation, entered into an asset purchase agreement (the “Purchase
Agreement”) with Ranger Energy Investments, LLC (“Ranger
Energy”), pursuant to which we will sell, subject to the satisfaction of
certain conditions, a portion of our assets located on the New River Tract in
Eastern Tennessee for $10 million. The purchase price is payable in
cash and the assumption by Ranger Energy of approximately $6.0 million of
accounts payable the Company owes to an affiliate of Ranger
Energy. Ranger Energy also has agreed to lease a portion of the
Company’s coal reserves also located on the New River Tract and to purchase the
Company’s coal inventory located at the Baldwin Preparation Plant.
In
addition to the purchase price for the assets, we also will receive from Ranger
Energy the return of approximately $1,900,000 in cash that was previously
pledged to secure reclamation bonds and other liabilities associated with the
New River Tract operation, and payment for coal inventories on the property at
closing. Proceeds from the sale will be used to repay the $4.5
million balance due under our $5.0 million short-term revolving credit facility,
which facility currently is in default. Any remaining proceeds will
be used to repay financing obligations for certain of the assets being sold and
for other general corporate purposes.
The
consummation of the sale is conditioned upon Ranger Energy’s purchase from
Centaurus Energy Master Fund, LP of $30.3 million of our 10.5% senior secured
notes due 2010 and our $5 million short-term revolving credit facility, among
other customary closing conditions. We have been advised by Ranger
Energy that it has purchased the debt from Centaurus. The asset sale
transaction is expected to close before the end of April 2010.
The
assets being sold include the Baldwin preparation plant, the active underground
mine number 5A, and the idled surface mine number 3, along with the associated
permits and certain liabilities. In addition, a coal contract
associated with the facilities may be assigned to Ranger Energy. Also included
in the transaction are the coal mineral rights on approximately 22,000 acres
which will be leased to Ranger Energy for a royalty of 6% to 8% of applicable
revenues.
Ranger
Energy agreed to indemnify us and certain of our affiliates, against certain
losses, including those arising from or related to Ranger Energy’s breach of any
representation, warranty or covenant contained in the Purchase Agreement or in
any related agreement, the assumed liabilities, and the use of the subject
assets after the closing. We agreed to indemnify Ranger Energy and
certain of its affiliates, against certain losses, including those arising from
or related to our breach of any representation, warranty or covenant contained
in the Purchase Agreement or in any related agreement, and the liabilities that
are retained by us.
The
Purchase Agreement may be terminated upon the mutual consent of the parties, by
either Ranger Energy or us if the Closing does not occur on or before April 30,
2010, or by either Ranger Energy or us upon prior written notice for the other
party’s failure to perform their covenants or material breach of their
representations and warranties under the Purchase Agreement.
2
Marshall
Miller & Associates acted as financial advisor to National Coal Corp., and
provided a fair market valuation of the subject assets and an analysis of the
reasonableness of the terms of the subject coal mineral rights
lease.
On April
12, 2010, we issued a press release announcing the Purchase Agreement, a copy of
which is attached hereto as Exhibit 99.1.
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Item
9.01.
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Financial
Statements and Exhibits
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(d) Exhibits.
The
following exhibits are filed herewith:
Exhibit
Number
Description
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99.1
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Press
release issued by National Coal Corp., dated April 12,
2010.
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SIGNATURE
Pursuant
to 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 hereunto
duly authorized.
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NATIONAL
COAL CORP.
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Date: April
14, 2010
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By: /s/
Daniel A.
Roling
Daniel A. Roling
Chief Executive Officer and
President
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