SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 6)
ADDINGTON RESOURCES, INC.
(Name of Issuer)
COMMON STOCK, $1.00 PAR VALUE
(Title of Class of Securities)
006516 108
(CUSIP Number)
Bruce Addington
1500 North Big Run Road
Ashland, Kentucky 41102
(606) 928-3433
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 2, 1995
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this schedule because of Rule
13d-1(b)(3) or (4), check the following box. /__/
Check the following box if a fee is being paid with this
statement. / /
<PAGE>
CUSIP NO. - 006516 10 8
(1) Name of reporting person. . . . . . . Bruce Addington
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . .
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . .
(4) Source of funds (see instructions). . 00
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . .
(6) Citizenship or place
of organization. . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . 924,006 <F1>
(8) Shared voting power. . . . . . . 0
(9) Sole dispositive power . . . . . 924,006 <F1>
(10) Shared dispositive power . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . 924,006 <F1>
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . .
(13) Percent of class represented
by amount in Row (11) . . . . . . . . . 6.2% <F1>
(14) Type of reporting person . . . . . . . IN
<F1> See responses to Items 4, 5 and 6 concerning a Stock Purchase
Agreement, dated August 4, 1995, that contains contractual restrictions on
voting and dispositive power.
<PAGE>
Reference is hereby made to that certain Schedule 13D dated January
29, 1988, as amended, (the "Schedule"), filed by Bruce Addington with
respect to the common stock, $1.00 par value (the "Common Stock"), of
Addington Resources, Inc., a Delaware corporation (the "Issuer"). The
purpose of this amendment is to amend and restate, in its entirety, the
Schedule to reflect (a) the consummation of the transactions contemplated
by that certain Stock Purchase Agreement, dated September 22, 1995, and
that certain Agreement and Plan of Corporate Separation, dated September
22, 1995, and (b) the expiration of the relationship between Larry
Addington and Bruce Addington, reported in Amendment No. 5 to this
Schedule, that may have given rise to their status as a group in connection
with the disposition of securities of the Issuer pursuant to the Agreement
and Plan of Corporate Separation. Information about Larry Addington as a
possible member of a group with the reporting person is no longer presented
in this Schedule. The Amendment also reflects a sale of shares of Common
Stock by the reporting person. The Schedule is amended and restated in its
entirety as follows.
<PAGE>
Item 1. Security and Issuer.
The class of equity securities to which this statement relates is the
common stock, $1.00 par value (the "Common Stock"), of Addington Resources,
Inc., a Delaware corporation (the "Issuer").
The Issuer's principal executive office is located at 771 Corporate
Drive, Suite 1000, Lexington, Kentucky 40503.
Item 2. Identity and Background.
(a) The person filing this statement is Bruce Addington.
(b) The business address of Bruce Addington is: Addington
Enterprises, Inc., 1500 North Big Run Road, Ashland, Kentucky 41102.
(c) Bruce Addington's Principal Occupation: Entreprenuer.
(d) During the last five years, Bruce Addington has not been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the last five years, Bruce Addington has not been a
party to a civil proceeding of a judicial or administrative body resulting
in a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
(f) Bruce Addington is a United States citizen.
Item 3. Sources and Amount of Funds or Other Consideration.
The Issuer was incorporated on September 29, 1986, to be a holding
company for various corporate entities owned or controlled by Larry,
Robert, and Bruce Addington, who are brothers (collectively, the "Addington
Brothers"). Before June 23, 1987, the Addington Brothers owned 100% of the
issued and outstanding shares of Addington, Inc., and Addwest Mining, Inc.,
and 95% of the issued and outstanding shares of Ironton Coal Company.
On June 23, 1987, the Issuer, through a series of exchanges of stock,
acquired all of the issued and outstanding shares of Addington, Inc., and
Addwest Mining, Inc. In addition, Addington, Inc., acquired the Addington
Brothers' interest in Ironton Coal Company.
During January 1988, the Issuer registered its Common Stock pursuant
to Section 12(g) of the Securities Exchange Act of 1934.
On or about February 23, 1995, the Addington Brothers, as a group, may
be deemed to have acquired beneficial ownership of the shares of Common
Stock owned by each of them, individually, as a result of the agreement or
understanding they reached to dispose of their shares of Common Stock as a
part of a spin-off proposal they submitted to the Issuer on or about March
1, 1995 (see Item 4).
On or about September 22, 1995, Bruce Addington and Larry Addington
may be deemed to have acquired beneficial ownership of the shares of Common
Stock owned by each of them, individually, as a result of their agreement
to dispose of shares of Common Stock pursuant to the Agreement and Plan of
Corporate Separation discussed in response to Item 4.
Item 4. Purpose of Transaction.
The June 23, 1987, reorganization discussed in response to Item 3 was
effected in preparation of an initial public offering of the Issuer's
Common Stock. Before the reorganization, the Addington Brothers owned all
or substantially all of the stock of the Issuer's predecessors. As a
result of the reorganization and initial public offering, the Addington
Brothers initially controlled 66.7% of the Issuer's common stock.
On or about March 1, 1995, the Addington Brothers formulated and
presented to the Issuer a proposal to spin-off the Issuer's environmental
and non-environmental businesses, which spin-off proposal was withdrawn on
July 11, 1995.
The Stock Purchase Agreement (the "Stock Purchase Agreement"), dated
August 4, 1995, among Bruce Addington, Larry Addington, Robert Addington
and HPB Associates, L.P. ("HPB") is filed as Exhibit 17 to this Schedule
and incorporated herein by reference. The sales of Common Stock by Bruce
Addington, Larry Addington and Robert Addington to HPB, as provided for in
the Stock Purchase Agreement, were consummated on August 4, 1995 and August
24, 1995.
The Stock Purchase Agreement contains agreements by the Addington
Brothers relating to the composition of the board of directors of the
Issuer and the voting of shares of Common Stock in all elections of
directors during the term of the Stock Purchase Agreement. Bruce Addington
intends to elect directors of the Issuer in accordance with his obligations
under the Stock Purchase Agreement during the term of that agreement.
In the Stock Purchase Agreement, each of the Addington Brothers also
agreed not to dispose or transfer shares of Common Stock except as
permitted by Section 6.02(d) of the agreement. Bruce Addington may in the
future sell shares of Common Stock, subject to the restrictions imposed
under Section 6.02(d) of the Stock Purchase Agreement during the term of
that agreement.
The obligations of Bruce Addington under the Stock Purchase Agreement
with respect to the voting and disposition of shares of Common Stock will
automatically terminate on August 31, 1997, if not sooner terminated to the
extent permitted by Section 7.01 thereof.
The Stock Purchase Agreement, dated September 22, 1995 (the
"Acquisition Agreement"), among the Issuer, Addington Holding Company,
Inc., Addington Acquisition Company, Inc., Larry Addington, Robert
Addington and Bruce Addington, is filed as Exhibit 19 to this Schedule and
incorporated herein by reference. The transactions contemplated by the
Acquisition Agreement were consummated on November 2, 1995. On that date,
pursuant to the Acquisition Agreement, the Addington Brothers, through
corporations owned by them, acquired, directly or indirectly, all of the
outstanding shares of the following subsidiaries of the Issuer: Addington
Mining, Inc.; Mining Technologies, Inc.; Addwest Mining, Inc.; Addington
Coal Holding, Inc.; Mining Technologies Australia Pty. Ltd.; Tennessee
Mining, Inc.; Addcar Contracting Pty. Ltd.; Energy, Inc.; and Addington
Coal Sales, Inc.
On November 2, 1995, Bruce Addington and Larry Addington exchanged, in
the aggregate, 1,000,000 shares of Common Stock owned by them for all of
the outstanding shares of Barton Creek Farm Limited and Belize River Fruit
Co., which are owned by the Issuer, indirectly, through Addington Holding
Company, Inc., pursuant to the terms and conditions contained in the
Agreement and Plan of Corporate Separation (herein so called), dated
September 22, 1995, among the Issuer, Addington Holding Company, Inc.,
Bruce Addington and Larry Addington, a copy of which is filed as Exhibit 20
to this Schedule and incorporated herein by reference. See the response to
Item 5.
By virtue of the transactions contemplated by the Acquisition
Agreement and the Agreement and Plan of Corporate Separation, the Addington
Brothers, directly and through corporations owned by them, acquired
substantially all of the Issuer's non-environmental operations (excluding
gold and lime).
Except as stated above, Bruce Addington does not have any present
plans or proposals which relate to or would result in: (i) the acquisition
by any person of additional securities of the Issuer, or the disposition of
securities of the Issuer, (ii) an extraordinary corporate transaction, such
as a merger, reorganization or liquidation involving the Issuer or any of
its subsidiaries, (iii) a sale or transfer of a material amount of assets
of the Issuer or any of its subsidiaries, (iv) any change in the present
board of directors or management of the Issuer, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board, (v) any material change in the present
capitalization or dividend policy of the Issuer, (vi) any other material
change in the Issuer's business or corporate structure, (vii) changes in
the Issuer's charter, bylaws or instruments corresponding thereto or other
actions which may impede the acquisition of control of the Issuer by any
person, (viii) causing a class of securities of the Issuer to be delisted
from a national securities exchange or cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national securities
association, (ix) a class of equity securities of the Issuer becoming
eligible for termination of registration pursuant to Section 12(g)(4) of
the Securities Exchange Act of 1934, or (x) any action similar to any of
those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a), (b) Bruce Addington beneficially owns 924,006 shares of Common
Stock (6.2% of those outstanding upon consummation of the Agreement and
Plan of Corporate Separation). Bruce Addington has sole voting and
dispositive power over the shares beneficially owned by him subject to the
restrictions on voting and dispositive power contained in the Stock
Purchase Agreement, dated August 4, 1995, between HPB and the Addington
Brothers, a copy of which is filed as Exhibit 17 to this Schedule and is
incorporated herein by reference. See the response to Items 4 and 6
concerning voting and dispositive power and shares pledged by Bruce
Addington.
(c) On November 2, 1995, Bruce Addington disposed of 150,000 shares
of Common Stock and Larry Addington disposed of 850,000 shares of Common
Stock in a transaction effected directly with the Issuer (and the Issuer's
subsidiary, Addington Holding Company, Inc.) pursuant to that certain the
Agreement and Plan of Corporate Separation, dated September 22, 1995, a
copy of which is filed as Exhibit 20 to this Schedule. The purchase price
paid for such shares by the Issuer (through Addington Holding Company,
Inc.) was, in the aggregate, the exchange of all of the outstanding shares
of Barton Creek Farm Limited and Belize River Fruit Co. owned by the
Issuer, indirectly, through Addington Holding Company, Inc. The closing
price of shares of Common Stock as of September 21, 1995, the date
preceding the date of the Agreement and Plan of Corporate Separation, which
fixed the number of shares of Common Stock being exchanged, was $14.625, as
reported by NASDAQ NMS. Following the disposition of such shares, Bruce
Addington has no agreements or understandings with Larry Addington to act
in concert in the disposition of securities of the Issuer.
On October 20, 1995, Bruce Addington sold 4,000 shares of Common
Stock in a broker's transaction in the open market at a price per share of
$14.50.
Otherwise, Bruce Addington has not effected any other
transactions in the Issuer's Common Stock since September 22, 1995, the
date of the most recent filing of an amendment to this Schedule.
(d) Bruce Addington has pledged a total of 650,000 shares of Common
Stock. He has not pledged 5% or more of the Issuer's Common Stock to any
one person. See the response to Item 6 of this Schedule.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
(i) The Stock Purchase Agreement, dated August 4, 1995, among the
Addington Brothers and HPB contains agreements concerning the disposition
of shares of Common Stock owned by the Addington Brothers and the voting of
shares of Common Stock in the election of directors of the Issuer during
the term of that agreement. The Stock Purchase Agreement is filed as
Exhibit 17 and is incorporated by reference herein.
(ii) The Agreement and Plan of Corporate Separation, which is filed
as Exhibit 20 and incorporated herein by reference, contains agreements
relating to the disposition of shares of Common Stock owned by Larry
Addington and Bruce Addington.
(iii) The following describes the currently outstanding pledges of
shares by Bruce Addington. On November 2, 1995, Bruce Addington pledged
250,000 shares of Common Stock to secure financing made available to
Addington Enterprises, Inc. in connection with the closing of the
transactions contemplated by the Acquisition Agreement. Bruce Addington
also has pledged 200,000 shares of Common Stock to a broker pursuant to a
pledge agreement dated June 26, 1995; 100,000 shares of Common Stock to a
broker pursuant to a pledge agreement; and 100,000 shares of Common Stock
to a broker.
Item 7. Material to be filed as Exhibits.
The following lists exhibits to this Schedule:
Exhibit 1 -- Letter dated March 1, 1995 to the Issuer from Larry
Addington, Robert Addington and Bruce Addington (previously filed)
Exhibit 2 -- Letter dated February 23, 1995, addressed to Larry
Addington from The CIT Group/Capital Equipment Financing, Inc. (previously
filed)
Exhibit 15 -- Pledge Agreement, dated June 26, 1995, between Bruce
Addington and Prudential Securities (previously filed)
Exhibit 16 -- Control, Restricted, or Shelf Registered Loan
Application between Bruce Addington and Prudential Securities (previously
filed)
Exhibit 17 -- Stock Purchase Agreement, dated August 4, 1995, among
HPB Associates, L.P. and Larry Addington, Robert Addington and Bruce
Addington (previously filed)
Exhibit 18 -- Letter agreement, dated August 4, 1995, between
Addington Resources, Inc. and Larry Addington, Robert Addington and Bruce
Addington (previously filed)
Exhibit 19 -- Stock Purchase Agreement, dated September 22, 1995,
among the Issuer, Addington Holding Company, Inc., Addington Acquisition
Company, Inc., Larry Addington, Robert Addington and Bruce Addington
(previously filed)
Exhibit 20 -- Agreement and Plan of Corporate Separation, dated
September 22, 1995, among the Issuer, Addington Holding Company, Inc.,
Larry Addington and Bruce Addington (previously filed)
Exhibit 21 -- Pledge Agreement, dated as of November 1, 1995, between
Bruce Addington and The CIT Group/Business Credit, Inc. for the benefit of
itself and The CIT Group/Equipment Finance, Inc. (filed herewith)
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
/s/ Bruce Addington
Bruce Addington
Date: November 8, 1995
EXHIBIT 21
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (the "Pledge Agreement"), dated as of
November 1, 1995, is executed by and between Bruce Addington (the
"Pledgor"), and The CIT Group/Business Credit, Inc.("CITBC") for the
benefit of itself and The CIT Group/Equipment Finance, Inc. (in such
capacity, the "Agent"). Capitalized terms used herein and not otherwise
defined herein shall have the respective meanings ascribed to such terms in
the "Loan Agreement" (as defined below).
WITNESSETH:
WHEREAS, Addington Enterprises, Inc., a Kentucky corporation (the
"Borrower") and CITBC have entered into a certain Financing Agreement of
even date herewith (as amended, restated, supplemented or otherwise
modified from time to time, the "Loan Agreement"), pursuant to which CITBC
has agreed, subject to certain conditions precedent, to make loans and
other financial accommodations to the Borrower from time to time;
WHEREAS, the Pledgor owns at least 250,000 shares of the issued
and outstanding common stock of Addington Resources, Inc., a Delaware
corporation (the "Corporation");
WHEREAS, CITBC has required, as a condition to its entering into
the Loan Agreement, that the Pledgor execute and deliver this Pledge
Agreement; and
NOW, THEREFORE, for and in consideration of the foregoing and of
any financial accommodations or extensions of credit (including, without
limitation, any loan or advance by renewal, refinancing or extension of the
agreements described hereinabove or otherwise) heretofore, now or hereafter
made to or for the benefit of the Borrower pursuant to the Loan Agreement
or any other agreement, instrument or document executed pursuant to or in
connection therewith, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Pledgor and
the Agent hereby agree as follows:
1. PLEDGE. The Pledgor hereby pledges to the Agent, and grants
to the Agent a security interest in, the following (collectively, the
"Pledged Collateral"):
(a) 250,000 shares of the common stock of the Corporation, now
owned by the Pledgor, and the certificates representing the shares of
such common stock (such now-owned shares being identified on EXHIBIT A
attached hereto and made a part hereof)(all of said capital stock
being hereinafter collectively referred to as the "Pledged Stock"),
herewith delivered to the Agent accompanied by stock powers in the
form of EXHIBIT B attached hereto and made a part hereof (the
"Powers") duly executed in blank, and all dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed in respect of, or in exchange for, any or all of the
Pledged Stock;
(b) The property and interests in property described in SECTION 3
below; and
(c) All proceeds of the foregoing.
At any time, the Pledgor may, with the prior written consent of
the Agent not to be unreasonably withheld, replace the Pledged Stock with
the shares of any publicly-traded corporation acceptable to the Agent (the
"Alternative Shares"). Any Alternative Shares shall have a value at least
equal to the greater of (i) the market value of the Pledged Stock at the
close of business on the date such replacement occurs and (ii) the market
value of the original Pledged Stock at the close of business on the date of
that certain commitment letter dated as of October 9, 1995 to Larry
Addington executed by The CIT Group/Equipment Financing, Inc. Upon any
such replacement, the Alternative Shares shall be deemed, upon delivery
thereof to the Agent, to be the Pledged Stock for all purposes hereof, and
the shares in Addington Resources, Inc. held by the Agent at that time
shall be returned to the Pledgor and the security interest in such shares
in Addington Resources, Inc. shall thereupon be released without any
further action on the part of the Agent.
2. SECURITY FOR LIABILITIES. The Pledged Collateral secures the
prompt payment, performance and observance of (i) the Borrower's
obligations and liabilities under the Loan Agreement and the Loan Documents
and (ii) the Pledgor's obligations and liabilities under this Pledge
Agreement and each agreement, document or instrument executed pursuant to
or in connection with this Pledge Agreement (all such obligations and
liabilities of the Pledgor and the Borrower now or hereafter existing being
hereinafter referred to as the "Liabilities").
3. PLEDGED COLLATERAL ADJUSTMENTS. If, during the term of this
Pledge Agreement:
(a) Any stock dividend, reclassification, readjustment or other
change is declared or made in the capital structure of the Corporation
which affects the Pledged Collateral, or any option included within
the Pledged Collateral is exercised, or both, or
(b) Any subscription warrants or any other rights or options
shall be issued in connection with the Pledged Collateral,
then all new, substituted and additional shares, warrants, rights, options
or other securities, issued by reason of any of the foregoing, shall be
immediately delivered to and held by the Agent under the terms of this
Pledge Agreement and shall constitute Pledged Collateral hereunder.
4. SUBSEQUENT CHANGES AFFECTING PLEDGED COLLATERAL. The Pledgor
represents and warrants that he has made his own arrangements for keeping
himself informed of changes or potential changes affecting the Pledged
Collateral (including, but not limited to, rights to convert, rights to
subscribe, payment of dividends, reorganization or other exchanges, tender
offers and voting rights), and the Pledgor agrees that neither CITBC nor
the Agent shall have an obligation to inform the Pledgor of any such
changes or potential changes or to take any action or omit to take any
action with respect thereto. The Agent may, after the occurrence of an
Event of Default, without notice and at its option, transfer or register
the Pledged Collateral or any part thereof into its or its nominee's name
with or without any indication that such Pledged Collateral is subject to
the security interest hereunder. In addition, the Agent may at any time
exchange certificates or instruments representing or evidencing Pledged
Shares for certificates or instruments of smaller or larger denominations.
5. REPRESENTATIONS AND WARRANTIES. The Pledgor represents and
warrants as follows:
(a) The Pledgor is the sole legal and beneficial owner of the
Pledged Stock;
(b) The Pledged Stock is free and clear of any Lien except for
the security interest created by this Pledge Agreement;
(c) The Pledgor has full power and capacity to enter into this
Pledge Agreement;
(d) There are no restrictions upon the voting rights associated
with, or upon the transfer of, any of the Pledged Collateral,
with the exception of certain voting restrictions and transfer
restrictions set forth in SECTION 6.02 of the Stock Purchase
Agreement dated as of August 4, 1995 among HPB Associates, L.P.,
Robert Addington, Bruce Addington and Larry Addington;
(e) The Pledgor has the right to vote, pledge and grant a
security interest in or otherwise transfer such Pledged
Collateral free of any Liens;
(f) No authorization, approval, or other action by, and no
notice to or filing with, any governmental authority or
regulatory body is required either (i) for the pledge of the
Pledged Collateral pursuant to this Pledge Agreement or for the
execution, delivery or performance of this Pledge Agreement by
the Pledgor or (ii) for the exercise by the Agent of the voting
or other rights provided for in this Pledge Agreement or the
remedies in respect of the Pledged Collateral pursuant to this
Pledge Agreement (except as may be required in connection with
such disposition by laws affecting the offering and sale of
securities generally);
(g) When the Agent takes possession of the Pledged Stock and
when appropriate UCC financing statements have been filed with
respect to the other Pledged Collateral, the pledge of the
Pledged Collateral pursuant to this Pledge Agreement creates a
valid and perfected first priority security interest in the
Pledged Collateral, in favor of the Agent, securing the payment
and performance of the Liabilities;
(h) The Powers are duly executed and give the Agent the
authority they purport to confer; and
(i) The Pledgor acquired and fully paid for the common stock
which is the subject of this Pledge, and has been the beneficial
owner of such common stock, for more than three years prior to
the date hereof.
6. VOTING RIGHTS. During the term of this Pledge Agreement, and
except as provided in this SECTION 6 below, the Pledgor shall have the
right to vote the Pledged Stock on all corporate questions in a manner not
inconsistent with the terms of this Pledge Agreement, the Loan Agreement
and any other agreement, instrument or document executed pursuant thereto
or in connection therewith. After the occurrence of an Event of Default,
the Agent or the Agent's nominee may, at the Agent's or such nominee's
option and following written notice from the Agent to the Pledgor, exercise
all voting powers pertaining to the Pledged Collateral, including the right
to take action by shareholder consent. Such authorization shall constitute
an irrevocable voting proxy from the Pledgor to the Agent or, at the
Agent's option, to the Agent's nominee.
7. DIVIDENDS AND OTHER DISTRIBUTIONS. (a) So long as no Event
of Default or Default shall have occurred:
(i) The Pledgor shall be entitled to receive and retain any and
all dividends and interest paid in respect of the Pledged Collateral,
PROVIDED, HOWEVER, that any and all
(A) dividends and interest paid or payable other than in
cash with respect to, and instruments and other property
received, receivable or otherwise distributed with respect to, or
in exchange for, any of the Pledged Collateral;
(B) dividends and other distributions paid or payable in
cash with respect to any of the Pledged Collateral on account of
a partial or total liquidation or dissolution or in connection
with a reduction of capital, capital surplus or paid-in surplus;
and
(C) cash paid, payable or otherwise distributed with
respect to principal of, or in redemption of, or in exchange for,
any of the Pledged Collateral;
shall be Pledged Collateral, and shall be forthwith delivered to the
Agent to hold as Pledged Collateral and shall, if received by the
Pledgor, be received in trust for the Agent, be segregated from the
other property or funds of the Pledgor, and be delivered immediately
to the Agent as Pledged Collateral in the same form as so received
(with any necessary endorsement); and
(ii) The Agent shall execute and deliver (or cause to be
executed and delivered) to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request for the purpose of
enabling the Pledgor to receive the dividends or interest payments
which he is authorized to receive and retain pursuant to CLAUSE (I)
above.
(b) After the occurrence of an Event of Default or a Default:
(i) All rights of the Pledgor to receive the dividends and
interest payments which he would otherwise be authorized to receive
and retain pursuant to SECTION 7(A)(I) hereof shall cease, and all
such rights shall thereupon become vested in the Agent, which shall
thereupon have the sole right to receive and hold as Pledged
Collateral such dividends and interest payments; and
(ii) All dividends and interest payments which are received by
the Pledgor contrary to the provisions of CLAUSE (I) of this SECTION
7(B) shall be received in trust for the Agent, shall be segregated
from other funds of the Pledgor and shall be paid over immediately to
the Agent as Pledged Collateral in the same form as so received (with
any necessary endorsements).
8. TRANSFERS AND OTHER LIENS. The Pledgor agrees that he will
not (i) sell or otherwise dispose of, or grant any option with respect to,
any of the Pledged Collateral without the prior written consent of the
Agent, or (ii) create or permit to exist any Lien upon or with respect to
any of the Pledged Collateral, except for the security interest under this
Pledge Agreement.
9. REMEDIES. (a) The Agent shall have, in addition to any
other rights given under this Pledge Agreement or by law, all of the rights
and remedies with respect to the Pledged Collateral of a secured party
under the Uniform Commercial Code as in effect in the State of New York.
After the occurrence of an Event of Default and following written notice to
the Pledgor, the Agent (personally or through an agent) is hereby
authorized and empowered to transfer and register in its name or in the
name of its nominee the whole or any part of the Pledged Collateral, to
exercise all voting rights with respect thereto, to collect and receive all
cash dividends and other distributions made thereon, and to otherwise act
with respect to the Pledged Collateral as though the Agent were the
outright owner thereof, the Pledgor hereby irrevocably constituting and
appointing the Agent as the proxy and attorney-in-fact of the Pledgor, with
full power of substitution to do so, such proxy becoming effective upon the
occurrence of an Event of Default and following written notice thereof;
provided, however, that the Agent shall have no duty to exercise any such
right or to preserve the same and shall not be liable for any failure to do
so or for any delay in doing so. In addition, after the occurrence of an
Event of Default, the Agent shall have such powers of sale and other powers
as may be conferred by applicable law. With respect to the Pledged
Collateral or any part thereof which shall then be in or shall thereafter
come into the possession or custody of the Agent or which the Agent shall
otherwise have the ability to transfer under applicable law, the Agent may,
in its sole discretion, without notice except as specified below, after the
occurrence of an Event of Default, sell or cause the same to be sold at any
exchange, broker's board or at public or private sale, in one or more sales
or lots, at such price as the Agent may deem best, for cash or on credit or
for future delivery, without assumption of any credit risk, and the
purchaser of any or all of the Pledged Collateral so sold shall thereafter
own the same, absolutely free from any claim, encumbrance or right of any
kind whatsoever. The Agent may, in its own name, or in the name of a
designee or nominee, buy the Pledged Collateral at any public sale and, if
permitted by applicable law, buy the Pledged Collateral at any private
sale. The Pledgor will pay to the Agent all reasonable expenses
(including, without limitation, court costs and reasonable attorneys' and
paralegals' fees and expenses) of, or incidental to, the enforcement of any
of the provisions hereof. The Agent agrees to distribute any proceeds of
the sale of the Pledged Collateral in accordance with the Loan Agreement
and the Pledgor shall remain liable for any deficiency following the sale
of the Pledged Collateral.
(b) Unless any of the Pledged Collateral threatens to decline
speedily in value or is or becomes of a type sold on a recognized market,
the Agent will give the Pledgor reasonable notice of the time and place of
any public sale thereof, or of the time after which any private sale or
other intended disposition is to be made. Any sale of the Pledged
Collateral conducted in conformity with reasonable commercial practices of
banks, commercial finance companies, insurance companies or other financial
institutions disposing of property similar to the Pledged Collateral shall
be deemed to be commercially reasonable. Notwithstanding any provision to
the contrary contained herein, the Pledgor agrees that any requirements of
reasonable notice shall be met if such notice is received by the Pledgor as
provided in SECTION 25 below at least five (5) Business Days before the
time of the sale or disposition; provided, however, that Agent may give any
shorter notice that is commercially reasonable under the circumstances.
Any other requirement of notice, demand or advertisement for sale is
waived, to the extent permitted by law.
(c) In view of the fact that federal and state securities laws
may impose certain restrictions on the method by which a sale of the
Pledged Collateral may be effected after an Event of Default, the Pledgor
agrees that after the occurrence of an Event of Default, the Agent may,
from time to time, attempt to sell all or any part of the Pledged
Collateral by means of a private placement restricting the bidders and
prospective purchasers to those who are qualified and will represent and
agree that they are purchasing for investment only and not for
distribution. In so doing, the Agent may solicit offers to buy the Pledged
Collateral, or any part of it, from a limited number of investors deemed by
the Agent, in its reasonable judgment, to be financially responsible
parties who might be interested in purchasing the Pledged Collateral. If
the Agent solicits such offers from not less than four (4) such investors,
then the acceptance by the Agent of the highest offer obtained therefrom
shall be deemed to be a commercially reasonable method of disposing of such
Pledged Collateral; provided, however, that this Section does not impose a
requirement that the Agent solicit offers from four or more investors in
order for the sale to be commercially reasonable.
10. SECURITY INTEREST ABSOLUTE. All rights of the Agent and
security interests hereunder, and all obligations of the Pledgor hereunder,
shall be absolute and unconditional irrespective of:
(i) Any lack of validity or enforceability of the Loan Agreement
or any other agreement or instrument relating thereto;
(ii) Any change in the time, manner or place of payment of, or
in any other term of, all or any part of the Liabilities, or any other
amendment or waiver of or any consent to any departure from the Loan
Agreement;
(iii) Any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to
departure from any guaranty, for all or any part of the Liabilities;
or
(iv) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor in respect of the
Liabilities or of this Pledge Agreement.
11. AGENT APPOINTED ATTORNEY-IN-FACT. The Pledgor hereby
appoints the Agent his attorney-in-fact, with full authority, in the name
of the Pledgor or otherwise, after the occurrence of an Event of Default,
from time to time in the Agent's sole discretion, to take any action and to
execute any instrument which the Agent may deem necessary or advisable to
accomplish the purposes of this Pledge Agreement, including, without
limitation, to receive, endorse and collect all instruments made payable to
the Pledgor representing any dividend, interest payment or other
distribution in respect of the Pledged Collateral or any part thereof and
to give full discharge for the same and to arrange for the transfer of all
or any part of the Pledged Collateral on the books of the Corporation to
the name of the Agent or the Agent's nominee.
12. WAIVERS. The Pledgor waives presentment and demand for
payment of any of the Liabilities, protest and notice of dishonor or Event
of Default with respect to any of the Liabilities and all other notices to
which the Pledgor might otherwise be entitled except as otherwise expressly
provided herein or in the Loan Agreement.
13. TERM. This Pledge Agreement shall remain in full force and
effect until the Liabilities have been fully and indefeasibly paid in cash
and the Loan Agreement has terminated pursuant to its terms. Upon the
termination of this Pledge Agreement as provided above (other than as a
result of the sale of the Pledged Collateral), the Agent will release the
security interest created hereunder and, if it then has possession of the
Pledged Stock, will deliver the Pledged Stock and the Powers to the
Pledgor.
14. DEFINITIONS. The singular shall include the plural and vice
versa and any gender shall include any other gender as the context may
require.
15. SUCCESSORS AND ASSIGNS. This Pledge Agreement shall be
binding upon and inure to the benefit of the Pledgor, CITBC, the Agent and
their respective successors and assigns. The Pledgor's successors and
assigns shall include, without limitation, a receiver, trustee or
debtor-in-possession of or for the Pledgor.
16. GOVERNING LAW. Any dispute between CITBC or the Agent and
the Pledgor arising out of or related to the relationship established
between them in connection with this Pledge Agreement, and whether arising
in contract, tort, equity, or otherwise, shall be resolved in accordance
with the laws of the State of New York.
17. CONSENT TO JURISDICTION; COUNTERCLAIMS; FORUM NON
CONVENIENS. (a) EXCLUSIVE JURISDICTION. Except as provided in SUBSECTION
(B) of this SECTION 17, CITBC, the Agent and the Pledgor agree that all
disputes between them arising out of or related to the relationship
established between them in connection with this Pledge Agreement, whether
arising in contract, tort, equity, or otherwise, shall be resolved only by
state or federal courts located in New York, New York, but the parties
acknowledge that any appeals from those courts may have to be heard by a
court located outside of New York, New York.
(b) OTHER JURISDICTIONS. The Agent shall have the right to
proceed against the Pledgor or his real or personal property in a court in
any location to enable the Agent to obtain personal jurisdiction over the
Pledgor, to realize on the Pledged Collateral or any other security for the
Liabilities or to enforce a judgment or other court order entered in favor
of the Agent. The Pledgor shall not assert any permissive counterclaims in
any proceeding brought by the Agent arising out of or relating to this
Pledge Agreement.
(c) VENUE; FORUM NON CONVENIENS. Each of the Pledgor and the
Agent waives any objection that he or it may have (including, without
limitation, any objection to the laying of venue or based on FORUM NON
CONVENIENS) to the location of the court in which any proceeding is
commenced in accordance with this SECTION 17.
18. SERVICE OF PROCESS. The Pledgor waives personal service of
any process upon him and, as security for the Liabilities, irrevocably
appoints CT CORPORATION SYSTEM, INC., 1633 BROADWAY, NEW YORK, NEW YORK
10019 as his registered agent for the purpose of accepting service of
process issued by any court.
19. WAIVER OF JURY TRIAL. Each of the Pledgor and the Agent
waives any right to trial by jury in any dispute, whether sounding in
contract, tort, or otherwise, between the Agent and the Pledgor arising out
of or related to the transactions contemplated by this Pledge Agreement or
any other instrument, document or agreement executed or delivered in
connection herewith. Either the Pledgor or the Agent may file an original
counterpart or a copy of this Pledge Agreement with any court as written
evidence of the consent of the parties hereto to the waiver of their right
to trial by jury.
20. WAIVER OF BOND. The Pledgor waives the posting of any bond
otherwise required of the Agent in connection with any judicial process or
proceeding to realize on the Collateral or any other security for the
Liabilities, to enforce any judgment or other court order entered in favor
of the Agent, or to enforce by specific performance, temporary restraining
order, or preliminary or permanent injunction, this Pledge Agreement or any
other agreement or document between the Agent and the Pledgor.
21. ADVICE OF COUNSEL. The Pledgor represents and warrants to
CITBC and the Agent that he has consulted with its legal counsel regarding
all waivers under this Pledge Agreement, including without limitation those
under SECTION 12 and SECTIONS 16 through 20 hereof, that he believes that
he fully understands all rights that he is waiving and the effect of such
waivers, that he assumes the risk of any misunderstanding that he may have
regarding any of the foregoing, and that he intends that such waivers shall
be a material inducement to the Agent to extend the indebtedness secured
hereby.
22. SEVERABILITY. Whenever possible, each provision of this
Pledge Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but, if any provision of this Pledge Agreement
shall be held to be prohibited or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Pledge Agreement.
23. FURTHER ASSURANCES. The Pledgor agrees that he will
cooperate with the Agent and will execute and deliver, or cause to be
executed and delivered, all such other stock powers, proxies, instruments
and documents, and will take all such other actions, including, without
limitation, the execution and filing of financing statements, as the Agent
may reasonably request from time to time in order to carry out the
provisions and purposes of this Pledge Agreement.
24. THE AGENT'S DUTY OF CARE. The Agent shall not be liable for
any acts, omissions, errors of judgment or mistakes of fact or law
including, without limitation, acts, omissions, errors or mistakes with
respect to the Pledged Collateral, except for those arising out of or in
connection with the Agent's (i) gross negligence or willful misconduct, or
(ii) failure to use reasonable care with respect to the safe custody of the
Pledged Collateral in the Agent's possession. Without limiting the
generality of the foregoing, the Agent shall be under no obligation to take
any steps necessary to preserve rights in the Pledged Collateral against
any other parties but may do so at its option. All expenses incurred in
connection therewith shall be for the sole account of the Pledgor, and
shall constitute part of the Liabilities secured hereby.
25. NOTICES. All notices and other communications required or
desired to be served, given or delivered hereunder shall be made in writing
or by a telecommunications device capable of creating a written record and
shall be addressed to the party to be notified as follows:
if to the Pledgor, at
Bruce Addington
528 Jasper Lane
Paintsville, Kentucky 41240
if to the Agent, at
The CIT Group/Business Credit, Inc.
10 South LaSalle Street
22nd Floor
Chicago, Illinois 60603
Attention: Matthew Downs
Telecopy: (312) 443-0139
with a copy to
The CIT Group/Equipment Finance, Inc.
1400 Renaissance Drive
Suite 400
Park Ridge, Illinois 60068
Attention: Robert Agler
Telecopy: (708) 390-6755
or, as to each party, at such other address as designated by such party in
a written notice to the other party. All such notices and communications
shall be deemed to be validly served, given or delivered (i) three (3) days
following deposit in the United States mails, with proper postage prepaid;
(ii) upon delivery thereof if delivered by hand to the party to be
notified; (iii) upon delivery thereof to a reputable overnight courier
service, with delivery charges prepaid; or (iv) upon transmission thereof
with confirmation of successful transmission from the sending
telecommunications device, if sent by telecommunications device.
26. AMENDMENTS, WAIVERS AND CONSENTS. No amendment or waiver of
any provision of this Pledge Agreement nor consent to any departure by the
Pledgor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Agent pursuant to the terms of the Loan
Agreement, and then such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
27. SECTION HEADINGS. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof.
28. EXECUTION IN COUNTERPARTS. This Pledge Agreement may be
executed in any number of counterparts, each of which shall be an original,
but all of which shall together constitute one and the same agreement.
29. MERGER. This Pledge Agreement represents the final
agreement of the Pledgor with respect to the matters contained herein and
may not be contradicted by evidence of prior or contemporaneous agreements,
or subsequent oral agreements, between the Pledgor and the Agent.
<PAGE>
IN WITNESS WHEREOF, the Pledgor and the Agent have executed this
Pledge Agreement as of the date set forth above.
/s/ Bruce Addington
Bruce Addington
THE CIT GROUP/BUSINESS CREDIT,
INC., as Agent
By: /s/ Matt Downs
Vice President
<PAGE>
ACKNOWLEDGMENT
The undersigned hereby acknowledges receipt of a copy of the
foregoing Pledge Agreement, agrees promptly to note on its books the
security interests granted under such Pledge Agreement, and waives any
rights or requirement at any time hereafter to receive a copy of such
Pledge Agreement in connection with the registration of any Pledged
Collateral in the name of the Agent or its nominee or the exercise of
voting rights by the Agent or its nominee.
ADDINGTON RESOURCES, INC.
By: /s/ Larry Addington
Title:
<PAGE>
EXHIBIT A
to
PLEDGE AGREEMENT
dated as of November 1, 1995
PLEDGED STOCK CERTIFICATES
Percentage of Shares of Common
Issued and Outstanding Stock owned by
Common Stock owned the Pledgor Subject
NAME BY THE PLEDGOR TO PLEDGE
Addington
Resources, Inc. __% 250,000
<PAGE>
EXHIBIT B
to
PLEDGE AGREEMENT
dated as of November 1, 1995
FORM OF STOCK POWER
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to _____________________________ _____ Shares of Common Stock of
Addington Resources, Inc., a Kentucky corporation, represented by
Certificate No. __ (the "Stock"), standing in the name of the undersigned
on the books of said corporation and does hereby irrevocably constitute and
appoint ___________________________________ as the undersigned's true and
lawful attorney, for him and in his name and stead, to sell, assign and
transfer all or any of the Stock, and for that purpose to make and execute
all necessary acts of assignment and transfer thereof; and to substitute
one or more persons with like full power, hereby ratifying and confirming
all that said attorney or substitute or substitutes shall lawfully do by
virtue hereof.
Dated: _______________
_________________________
Bruce Addington
