Business
American Resources Corporation Enters into New Non-Dilutive Credit Facilities for up to $10 Million
Credit facilities are backed by inventory and accounts receivables to provide added flexibility as it expands carbon production at its various complexes
About this update from American Resources Corporation
[{"type":"text","content":"Credit facilities are backed by inventory and accounts receivables to provide added flexibility as it expands carbon production at its various complexes Strength of balance sheet enables Company to access additional low-cost, non-dilutive forms of financing structuresFISHERS, IN / ACCESSWIRE / January 27, 2021 / American Resources Corporation (NASDAQ:AREC) (\"American Resources\" or the \"Company\"), a next generation and socially responsible supplier of raw materials to the new infrastructure marketplace, today announced that it has secured two new credit facilities that can be used to draw against inventories and accounts receivables. The credit facilities can be utilized at the Company's discretion to drive revenues at its Perry County Resources, McCoy Elkhorn and Wyoming County complexes and provide additional flexibility as it executes upon its growth objectives. With an initial ability to draw up to $10 million in expansion financing, both facilities have provisions that enables them to be increased as the Company expands its production and revenue base.The credit facilities will enable American Resources to further expand its production from American Carbon, American Rare Earth and American Metals while still ensuring a strong liquidity position. The total cost of the facilities are forecasted to represent one of the lowest costs of capital achieved to date for the Company since formation over five years ago. For the inventory facility, the Company is able to draw 80% of the inventory value at a cost of 2% for up to each 120 days outstanding and is subject to standard terms and conditions of the agreements. For the accounts receivable facility, the Company is able to draw 90% of the accounts receivable value at an equivalent 8% APR per year and is subject to standard terms and conditions of the agreements.Kirk Taylor, Chief Financial Officer of American Resources Corporation, commented, \"Being in a position to enter into two traditional credit agreements in today's market environment is a testament to the strength of our Company's financial position and balance sheet. The attractiveness of these credit facilities is that they will result in no equity dilution to our shareholders, they are a low-cost form of capital, provide the Company with additional flexibility as it ramps its production growth, and only incurs interes...