Exhibit
10.2
THE SECURITIES
REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”). THESE SECURITIES MAY BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY, (B)
OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION
S UNDER THE SECURITIES ACT, (C) IN COMPLIANCE WITH RULE 144 OR 144A
THEREUNDER, IF AVAILABLE, AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS, (D) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT, OR (E) IN A TRANSACTION THAT DOES NOT REQUIRE
REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE
SECURITIES LAWS, AND THE HOLDER HAS, PRIOR TO SUCH SALE, FURNISHED
TO THE COMPANY AN OPINION OF COUNSEL OR OTHER EVIDENCE OF
EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE
COMPANY. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES
MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE U.S. SECURITIES
ACT.
AMENDED AND RESTATED 17%
SECURED PROMISSORY NOTE
AMERICA WEST RESOURCES,
INC
DUE October 9,
2009
|
Original Issue
Date: October 9, 2008
|
US $1,866,666.66
|
This Amended and Restated Secured Promissory
Note (the “Note”) amends and restates in it
entirety the 17% Secured Promissory Note due October 9,
2009 issued by America West Resources, Inc , a Nevada
corporation (the “ Company ”), in favor of
Denly ACI Partners, Ltd. , a Texas limited partnership
(together with its permitted successors
and assigns, the “ Holder ”), in accordance
with exemptions from registration under the Securities Act
of 1933, as amended (the “ Securities Act ”) and
pursuant to the terms and provisions and in reliance upon the
representations and warranties set forth in that certain Loan
Agreement (as amended, modified, restated and replaced from time to
time, the " Loan Agreement ") of even date among the
Company, the Holder and _____________________ (together with its permitted successors and assigns,
the “ Other Holder ”)
. Capitalized terms used herein which are not otherwise
defined are used with the same meanings given such terms in the
Loan Agreement.
Article I.
Section 1.01
Principal and Interest
. For value received, the
Company hereby promises to pay to the order of the Holder, in
lawful money of the United States of America and in immediately
available funds the principal sum of
___________________________, or the outstanding principal
amount advanced hereunder, whichever is the lesser, and accrued but
unpaid interest on the earliest of (i) September 17, 2009 (the
“ Maturity Date ”), or (ii) the occurrence of an
Event of Default (as defined in Section 3.01 ) or (iii) the
occurrence of a Redemption Event (as defined in
Section
1.02 ), with partial
payments being required upon each Partial Redemption Event (as
defined in Section 1.02 ).
(a) The unpaid principal balance of this Note shall
accrue interest at the rate of 10% per annum until the Maturity
Date or such earlier date as the same may become payable
hereunder.
(b) On the earlier of a Redemption Event and the
Maturity Date, the entire unpaid principal and accrued interest
shall be paid to the Holder.
(c) Except as otherwise set forth in this Note, the
Company may not prepay any portion of the principal amount of this
Note without the prior written consent of the Holder.
Section 1.02
Redemption
. Upon the closing of (i)
any debt financing of $13,000,000 or more either by the Company or
its subsidiaries or the last of any such debt financings which
taken together equal $13,000,000 or more either by the Company or
its subsidiaries, or (ii) any equity financing of $10,000,000 or
more by the Company or its subsidiaries or the last of any such
equity financings which taken together equal $10,000,000 or more
either by the Company or its subsidiaries, or (iii) the last of any
combination of debt financings and equity financings either by the
Company or its subsidiaries which taken together equal
$10,000,000.00 or more (a “ Redemption Event ”),
the Company shall pay in full all of the principal and interest
under then accrued and unpaid on this Note. Upon the
closing of an equity financing (or a series of equity financings)
less than $10,000,000 by the Company or its subsidiaries (a “
Partial Redemption Event ”), the Company shall pay an
amount equal to 25% of the proceeds of the financing or series of
financings and such amount shall be applied first to accrued
interest then unpaid and next to principal of this
Note. The foregoing notwithstanding, the closing of
$10,000,000 or less in equity that occurs on or before December 31,
2008, shall not result in a Redemption Event or Partial Redemption
Event and shall not be aggregated with subsequent equity financings
for purposes of calculating a Partial Redemption Event.
Section 1.03
Absolute
Obligation/Ranking . Except as expressly provided
herein, no provision of this Note shall alter or impair the
obligation of the Company, which is absolute and unconditional, to
pay the principal of, and interest on, this Note at the time,
place, and rate, and in the coin or currency, herein
prescribed. This Note is a direct debt obligation of the
Company. This Note ranks pari passu with all
other Notes now or hereinafter issued by the Company pursuant to
the provisions of the Loan Agreement, upon the same terms and
conditions of this Note (the “ Other Notes
”).
Section 1.04
Different
Denominations . This Note is exchangeable for an
equal aggregate principal amount of Notes of different authorized
denominations, as requested by the Holder surrendering the
same. No service charge will be made for such
registration of transfer or exchange.
Section
1.05
Investment
Representations . Holder
hereby makes the following representations and
warranties:
(a) Investment Purpose . Holder is acquiring the Note, and
the Bridge Shares for its own account for investment only and not
with a view towards, or for resale in connection with,
(b) the public sale or distribution thereof, except
pursuant to sales registered or exempted under the Securities
Act. The Holder agrees not to sell, hypothecate or
otherwise transfer the Holder’s securities unless such
securities are registered under the federal and applicable state
securities laws or unless, in the opinion of counsel satisfactory
to the Company, an exemption from such law is available.
(c) Accredited Investor Qualifications.
The Holder (i) if a
natural person, represents that the Holder has reached the age of
21 and has full power and authority to execute and deliver this
Agreement and all other related agreements or certificates and to
carry out the provisions hereof and thereof; (ii) if a corporation,
partnership, or limited liability company or partnership, or
association, joint stock company, trust, unincorporated
organization or other entity, represents that such entity was not
formed for the specific purpose of acquiring the Note, such entity
is duly organized, validly existing and in good standing under the
laws of the state of its organization, the consummation of the
transactions contemplated hereby is authorized by, and will not
result in a violation of state law or its charter or other
organizational documents, such entity has full power and authority
to execute and deliver this Agreement and all other related
agreements or certificates and to carry out the provisions hereof
and thereof and to purchase and hold the Note, the execution and
delivery of this Agreement has been duly authorized by all
necessary action, this Agreement has been duly executed and
delivered on behalf of such entity and is a legal, valid and
binding obligation of such entity; or (iii) if executing this
Agreement in a representative or fiduciary capacity, represents
that it has full power and authority to execute and deliver this
Agreement in such capacity and on behalf of the subscribing
individual, ward, partnership, trust, estate, corporation, or
limited liability company or partnership, or other entity for whom
the Holder is executing this Agreement, and such individual,
partnership, ward, trust, estate, corporation, or limited liability
company or partnership, or other entity has full right and power to
perform pursuant to this Agreement and make an investment in the
Company, and represents that this Agreement constitutes a legal,
valid and binding obligation of such entity. The
execution and delivery of this Agreement will not violate or be in
conflict with any order, judgment, injunction, agreement or
controlling document to which the Holder is a party or by which it
is bound;
(d) Solicitation . The Holder is unaware of, is in no
way relying on, and did not become aware of the offering of the
Note through or as a result of, any form of general solicitation or
general advertising including, without limitation, any article,
notice, advertisement or other communication published in any
newspaper, magazine or similar media or broadcast over television
or radio, in connection with the offering and sale of the Note and
is not subscribing for the Notes and did not become aware of the
offering of the Note through or as a result of any seminar or
meeting to which the Holder was invited by, or any solicitation of
a subscription by, a person not pre
