SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 9)
Addington Resources, Inc.
(Name of Issuer)
Common Stock, par value $1.00
(Title of Class of Securities)
006516108
(CUSIP Number)
Larry 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)
May 31, 1996
(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 the
statement [ ]. (A fee is not required only if the reporting
person: (1) has a previous statement on file reporting
beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7.)
<PAGE>
13D
CUSIP No. 006516108
_____________________________________________________________________________
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. Larry Addington
OF ABOVE PERSON
_____________________________________________________________________________
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP **
(a) [ ]
(b) [X]
_____________________________________________________________________________
(3) SEC USE ONLY
_____________________________________________________________________________
(4) SOURCE OF FUNDS
OO
_____________________________________________________________________________
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
_____________________________________________________________________________
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
_____________________________________________________________________________
NUMBER OF (7) SOLE VOTING POWER 2,263,324 <F1>
SHARES ______________________________________________________________
BENEFICIALLY (8) SHARED VOTING POWER -0-
OWNED BY ______________________________________________________________
EACH (9) SOLE DISPOSITIVE POWER 2,263,324 <F1>
REPORTING ______________________________________________________________
PERSON WITH (10) SHARED DISPOSITIVE POWER -0-
_____________________________________________________________________________
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED
BY EACH REPORTING PERSON 2,263,324 <F1>
_____________________________________________________________________________
(12) CHECK BOX IF THE AGGREGATE AMOUNT
IN ROW (11) EXCLUDES CERTAIN SHARES ** [ ]
_____________________________________________________________________________
(13) PERCENT OF CLASS REPRESENTED
BY AMOUNT IN ROW (11) 15.1% <F1>
_____________________________________________________________________________
(14) TYPE OF REPORTING PERSON
IN
_____________________________________________________________________________
** SEE INSTRUCTIONS BEFORE FILLING OUT!
See responses to Items 4, 5 and 6 of the 13D Amendment No. 8 filed on November
8,
1995 by Larry Addington concerning a Stock Purchase Agreement, dated August 4,
1995, that contains contractual restrictions on voting and dispositive power.
<PAGE>
This Schedule 13D, initially filed on January 29, 1988, as
amended, by Larry Addington, relating to the common stock, par value $1.00 per
share (the "Addington Common Stock"), of ADDINGTON RESOURCES, INC., a Delaware
corporation whose principal executive offices are located at 1500 North Big
Run Road, Ashland, Kentucky 41102 ("Addington") is hereby amended by this
Amendment No. 9 to the Schedule 13D as follows:
Item 4. Purpose of Transaction.
Item 4 is hereby supplemented by the addition of the following:
On May 31, 1996, Addington Resources, Inc. ("Addington") announced
that it had reached an agreement in principle with Republic Industries, Inc.
("Republic") for Republic to acquire Addington in a merger transaction in
which each outstanding share of Addington Common Stock would be converted into
the right to receive 0.45 of a share (or 0.90 of a share after adjustment for
a two-for-one stock split by Republic) of Republic Common Stock (the
"Merger").
Under the proposed Merger, a newly formed, wholly-owned subsidiary
of Republic will be merged with Addington and after the Merger shall be a
wholly -owned subsidiary of Republic. As stated in the Letter of Intent dated
May 31, 1996 (the "Letter of Intent"), it is the objective of the parties to
enter into a definitive merger agreement (the "Merger Agreement") as promptly
as possible but no later than June 30, 1996.
The proposed Merger, which will be accounted for on a pooling of
interests basis, is subject to customary terms and conditions, including the
negotiation and execution of a definitive agreement, completion of due
diligence, approval by the Boards of Directors of Addington and Republic,
approval by the stockholders of Addington, receipt of fairness opinions and
receipt of regulatory approvals.
Larry Addington has agreed to vote his shares in favor of the
Merger, and upon execution of the Merger Agreement he will deliver to
Republic its irrevocable proxies.
Moreover, Larry Addington has agreed, as part of the Merger
Agreement, to execute non-disclosure agreements which agreements shall contain
covenants not to compete with Republic, Addington or their affiliates in the
solid waste management business or, subject to certain exceptions, in any
other business in which Republic participates for a three year period
following the effective date of the Merger.
As part of the Letter of Intent, Larry Addington has agreed, until
the earlier of the termination of the Letter of Intent or (if executed) the
Merger Agreement, not to directly or indirectly (i) solicit or initiate
discussion with or (ii) enter into negotiations or agreements with, or
furnish any information about Addington that is not publicly available to, or
otherwise assist, facilitate or encourage, any person or entity or group
(other than Republic, an affiliate of Republic or their authorized
representatives) concerning any proposal for a merger, sale of substantial
assets, sale of shares of capital stock or other securities, recapitalization
or other business combination transactions involving Addington or any of the
subsidiaries of Addington or any material portion of any such company's
assets. Addington and the respective officers, directors, employees,
advisors, affiliates, counsel and agents of Addington and Addington's
subsidiaries may, however, furnish confidential information to, enter into
discussions with or enter into any negotiations (or enter into agreement
resulting from such negotiations) which were not so solicited or initiated to
the extent such action is taken by, or upon the authority of, the Board of
Directors of Addington due to the applicable fiduciary duties of such Board of
Directors to the stockholders of Addington, as determined by such directors
in the exercise of good faith judgment based upon the written advice of
outside legal counsel that a failure of the Board of Directors of Addington to
take such action would be likely to constitute a breach of its fiduciary
duties to the stockholders of Addington.
In addition, Addington has agreed to pay Republic a $1,000,000
termination fee in certain circumstances involving a Competing Transaction (as
defined in the Letter of Intent) as specified in the Letter of Intent and the
Principal Shareholders have agreed to pay to Republic in certain circumstances
involving a Competing Transaction, the excess of the amount per share of
Addington Common Stock realized by the Principal Shareholders in the Competing
Transaction over $15.00 (or in certain circumstances $21.50).
The foregoing description of the proposed Merger and the terms of
the Letter of Intent are qualified in their entirety by the express terms of
the Letter of Intent, which is filed as Exhibit 1 to this Amendment No.9.
Item 7. Material to be Filed as Exhibits.
Item 7 is hereby supplemented by the addition of the following:
1. Letter of Intent dated May 31, 1996 concerning a proposed
merger of a newly-formed, wholly-owned subsidiary of Republic Industries, Inc.
into Addington Resources, Inc. (filed herewith)
2. Stock Purchase Agreement, dated August 4, 1995, among HPB
Associates, L.P. and Larry Addington, Robert Addington and Bruce Addington
(previously filed)
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/ Larry Addington
Larry Addington
Dated: June 6, 1996
<PAGE>
EXHIBIT 1
May 31, 1996
Addington Resources, Inc.
771 Corporate Drive, Suite 1000
Lexington, KY 40503
Gentlemen:
This letter of intent is to confirm the general agreement in
principle which we have reached concerning a proposed merger (the "Merger") of
a newly-formed, wholly-owned subsidiary ("Newco") of Republic Industries, Inc.
("Republic") into Addington Resources, Inc. ("Addington").
This letter of intent is intended to form the basis upon which the
parties will mutually endeavor to promptly and in good faith take the steps
necessary to negotiate and enter into agreements with respect to the proposed
Merger. It is the objective of the parties to complete the due diligence
process and enter into a definitive merger agreement (the "Merger Agreement")
as promptly as possible but not later than June 30, 1996 (the "Termination
Date").
While it is presently contemplated that the transactions will be
on the basis set forth below, the parties acknowledge that this letter of
intent is not intended to, and does not, constitute binding obligations of
either party, which obligations can only be created in a mutually agreeable
Merger Agreement, except for Paragraphs 8 through 11, 13 and 15 hereof, which
the parties agree are intended to, and do, constitute binding obligations.
1. Structure. Newco will be merged into Addington upon the
filing of an appropriate Certificate of Merger (the date on which such
Certificate is filed is called the "Effective Date"). It is the intention of
the parties hereto that the Merger (a) will be treated for financial reporting
purposes as a pooling of interests, (b) will constitute a tax-free
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended, and (c) the terms and conditions to be contained in
the Merger Agreement will be consistent with such intention. The company
surviving the Merger is referred to as the "Surviving Company" and shall be a
wholly-owned subsidiary of Republic.
2. Due Diligence Review; Definitive Merger Agreement; Timing.
As soon as practicable after your confirmation of the terms of this letter of
intent, (a) Republic will promptly commence its due diligence review with
respect to the financial condition, business, operations and prospects of
Addington, and Addington will provide Republic with full access to all
documents, information (including, without limitation, Addington's financial
statements, tax returns, governmental reports, customer and supplier
information, contracts, environmental assessments, marketing studies and
memoranda), books, records and files, and to Addington's directors, officers
and professional advisors that Republic may request for such purpose, and (b)
Addington will commence its due diligence review of Republic, which shall be
limited to a review of publicly available information relating to Republic and
discussions with such senior management of Republic whom the parties mutually
agree upon. In addition, the parties shall promptly commence preparation and
negotiation of the Merger Agreement and preparation of the Registration
Statement (and related Proxy Statement) described in Paragraph 6 below.
Republic will prepare a draft of the Merger Agreement reflecting the terms of
the contemplated transaction as set forth in this letter, and the parties will
negotiate the terms and provisions thereof in good faith with a view to
execution thereof prior to the Termination Date. The Merger Agreement will be
based upon the general terms contained in this letter and will contain
representations, warranties, covenants, and other terms and conditions typical
of similar merger transactions.
3. Consideration. An aggregate of approximately 13,665,700
shares of common stock, $0.01 par value per share, of Republic ("Republic
Common Stock") (reflecting Republic's previously announced 2-for-1 stock
split) shall be issued to Addington shareholders pursuant to the Merger
Agreement (the "Consideration"). In addition, an aggregate of approximately
379,800 shares of Republic Common Stock shall be reserved for issuance to
holders of Addington options and stock grants that are convertible into shares
of Addington common stock, $1.00 par value per share, ("Addington Common
Stock"). On the Effective Date, each issued and outstanding share of
Addington Common Stock outstanding immediately prior to the Effective Date
shall be exchanged for 0.90 of a share of Republic Common Stock (the
"Conversation Ratio"). The Conversion Ratio and the number of shares of
Republic Common Stock referenced in this Letter of Intent have been adjusted
to reflect the 2-for-1 stock split that will be distributed on June 10, 1996.
4. Options. Republic understands that Addington has
outstanding options to purchase an aggregate of approximately 398,000 shares
of Addington Common Stock at exercise prices ranging from $7.50 per share to
$14.75 per share, which options are held by key employees, directors or
advisors of Addington (and are set forth in the attached Schedule A, including
individual exercise prices). Subject to review of the options and their
plans, such options which remain outstanding on the Effective Date will be
converted into options to purchase a number of shares of Republic Common Stock
determined by multiplying the number of shares of Addington Common Stock
subject to such option by the Conversion Ratio, with an exercise price per
share determined by dividing the exercise prices per share of such option by
the Conversion Ratio. Addington has no other outstanding options, warrants,
or other securities (debt or equity) convertible into Addington Common Stock.
5. Restrictions on Resale of Republic Common Stock. Those
persons who may be deemed "affiliates" of Addington within the meaning of Rule
405 promulgated under the Securities Act of 1933, as amended (the "Act"),
including, but not limited to, those shareholders of Addington who are
executing this letter of intent (the "Principal Shareholders"), and all other
executive officers and directors of Addington (such affiliates, Principal
Shareholders, other officers and directors being collectively referred to as
the "Restricted Parties"), shall represent at the time the Merger Agreement is
entered into that they have no plan or intention to sell, exchange or
otherwise dispose of the Republic Common Stock received by them pursuant to
the Merger, and will (a) agree that until such time as final results of
operations of Republic covering at least thirty (30) days of combined
operations of Republic and Addington subsequent to the Effective Date have
been published, the Restricted Parties will not sell or otherwise dispose of
any shares of Republic Common Stock issued to them pursuant to the Merger, and
(b) execute an appropriate "Affiliate Letter" (and consent to an appropriate
legend on the Republic stock certificates to be received by such person) to
assure compliance with Rule 145 promulgated under the Act. All Restricted
Parties shall agree to limit sales of the shares which they may sell following
the Effective Date to such amount of shares as is permitted to be sold in
accordance with Rule 145.
6. Filing of Registration Statement/Proxy Statement. Republic
shall prepare (with Addington's assistance and cooperation as reasonably
required by Republic) and file, promptly following execution of the Merger
Agreement, a Registration Statement on Form S-4 (the "Registration Statement")
under the Act for the purpose of registering the Republic Common Stock to be
issued in the Merger (the Prospectus in the Registration Statement to also
serve as the Proxy Statement to be used in connection with the Special Meeting
of Shareholders of Addington to be called to approve the Merger) and use their
best efforts to cause the Registration Statement to become effective as soon
thereafter as practicable. Addington shall set a record date for such a
Special Meeting, shall duly notice and call a Special Meeting to approve the
Merger, and shall cause such Proxy Statement to be mailed to its stockholders
promptly following the declaration of effectiveness of the Registration
Statement, all in accordance with its charter and bylaws, the Delaware General
Corporation Law (the "DGCL"), and the regulations of the Securities and
Exchange Commission (the "SEC") and the National Association of Securities
Dealers ("NASD").
7. Covenant Not to Compete. The Principal Shareholders shall,
as part of the Merger Agreement, execute non-disclosure agreements which
agreements shall contain covenants not to compete with Republic, the Surviving
Company or their affiliates in the solid waste management business or in any
other business in which Republic participates (except that in this latter case
the Principal Shareholders shall not be prohibited from investing in any
publicly traded company in which they collectively control at any time less
than 10 percent of the voting control of such company) for a three year period
following the Effective Date. Such agreements will also contain provisions
for the retention of confidentiality of trade secrets and other confidential
information, and for the non-solicitation of employees of Republic, the
Surviving Company and their affiliates during such non-competition period.
8. Covenant and Proxy to Vote. The Principal Shareholders
hereby agree to vote all of the shares of Addington Common Stock owned by them
(representing an aggregate of approximately 45% of the outstanding shares of
Addington Common Stock), a list of the number of such shares being contained
in a Schedule B annexed hereto, (a) in favor of the Merger, and (b) against
any proposal for any recapitalization, merger, sale of assets or other
business combination between Addington and any person or entity (other that he
Merger), or any other corporate action or agreement that would result in any
breach of the Merger Agreement or which could result in any condition to
Addington's obligations under the Merger Agreement not being fulfilled. The
Principal Shareholders agree, at the time the Merger Agreement is entered
into, to execute and deliver to Republic irrevocable proxies with respect to
all shares of Addington Common Stock owned by them to effect the foregoing.
9. No Solicitations. From the date hereof until the Effective
Date or the earlier of (a) such date as Republic shall have advised Addington
that it has elected to terminate this letter of intent, (b) the Termination
Date if no Merger Agreement is entered into prior thereto, or (c) the date the
Merger Agreement, if entered into, shall terminate in accordance with its
terms (the "Non-Solicitation Period"), neither Addington nor the Principal
Shareholders shall directly or indirectly (i) solicit or initiate discussion
with or (ii) enter into negotiations or agreements with, or furnish any
information about Addington that is not publicly available to, or otherwise
assist, facilitate or encourage, any person or entity or group (other than
Republic, an affiliate of Republic or their authorized representatives)
concerning any proposal for a merger, sale of substantial assets, sale of
shares of capital stock or other securities, recapitalization or other
business combination transactions involving Addington or any of the
subsidiaries of Addington or any material portion of any such company's assets
(a "Competing Transaction"). Addington and the Principal Shareholders will
instruct the respective officers, directors, employees, advisors, affiliates,
counsel and agents of Addington and Addington's subsidiaries (collectively,
the "Representatives") not to take any action contrary to the provisions of
the previous sentence. Notwithstanding the foregoing, Addington and the
Representatives shall not be prohibited from furnishing confidential
information to, entering into discussions with or entering into any
negotiations (or enter into agreement resulting from such negotiations) which
were not so solicited or initiated to the extent such action is taken by, or
upon the authority of, the Board of Directors of Addington due to the
applicable fiduciary duties of such Board of Directors to the stockholders of
Addington, as determined by such directors in the exercise of good faith
judgment based upon the written advice of outside legal counsel that a failure
of the Board of Directors of Addington to take such action would be likely to
constitute a breach of its fiduciary duties to the stockholders of Addington;
and provided, further, that prior to the execution and delivery of the Merger
Agreement and for a period of thirty (30) days following the date of execution
and delivery of the Merger Agreement, if Addington receives an offer or
proposal involving a Competing Transaction it may furnish all information
pertaining to Addington and its subsidiaries as the Board of Directors of
Addington believes in good faith to be appropriate, if the Board of Directors
of Addington (after consultation with its outside legal counsel) determines in
good faith that such action is required due to the applicable fiduciary duties
of the directors. Addington will notify Republic immediately in writing if
Addington becomes aware that any inquiries or proposals are received by, any
information is requested from, or any negotiations or discussions are sought
to be initiated with, Addington or its subsidiaries with respect to a
Competing Transaction. Each time, if any, that the Board of Directors of
Addington determines, upon written advice of such legal counsel and in the
exercise of its good faith judgment as to its fiduciary duties to Addington's
shareholders, that it must enter into negotiations with, or furnish any
information that is not publicly available to, any person or other entity or
group (other than Republic, an affiliate of Republic or their authorized
representatives) concerning any Competing Transaction, Addington will give
Republic prompt notice of such determination (which shall include a copy of
the written advice of such legal counsel), Addington will promptly provide
Republic copies of the information provided to such other person, entity or
group, and Addington will fully inform Republic of the status and substance of
such negotiations in a prompt manner.
To induce Republic to commit to expend its resources and money to
perform the due diligence investigation of Addington contemplated herein,
Addington agrees that should it or any of its Principal Shareholders of
Representatives during the Non-Solicitation Period either (a) receive an
unsolicited proposal for a Competing transaction (an "Acquisition Proposal"),
other than from Republic or an affiliate of Republic or their authorized
representatives, and, during the Non-Solicitation Period or within one (1)
year after the earliest of (I) the date Republic shall have advised Addington
that it has elected to terminate this letter of intent, (II) the Termination
Date if no Merger Agreement is entered into prior thereto, or (III) the date
the Merger Agreement is entered into, consummate a transaction of a kind that
would constitute a Competing Transaction with (x) the offeror or any affiliate
of the offeror who made the Acquisition Proposal (the "Original Offeror") or
(y) another party who makes an Acquisition Proposal prior to the termination
of negotiations with the Original Offeror, or (b) solicit or initiate any
discussions for a Competing Transaction (regardless of whether it is
consummated); then, in either instance, (x) Addingotn shall pay to Republic,
as liquidated damages (and not as a penalty) to compensate Republic for the
effort and expense which Republic will be expending in the course of its
investigation and for its lost opportunity, the sum of $1,000,000 (which shall
be paid contemporaneously with consummation of the Competing Transaction if
the Acquisition Proposal was not solicited, or contemporaneously with the
solicitation or initiation of any discussion if the Acquisition Proposal was
solicited) and (y) each Principal Shareholder shall pay to Republic an amount
in cash (or if the consideration to be received are securities of the
acquiror, an amount in such securities, or payment in such form as permitted
by the Competing Transaction) equal to the consideration paid by the acquiror
(the "Third Party Acquisition Consideration") on a per share of Addington
Common Stock basis in excess of (i) $15.00 (in the case of solicitations or
discussions initiated for Competing Transactions by Addington, any of the
Principal Shareholders or Representatives prior to the expiration of the non-
solicitation period) or (ii) $21.50 (in the case of unsolicited proposals)
(such amounts, as applicable being the "Base Amount") multiplied by the number
of shares held by such Principal Shareholders as of the date hereof (which
additional amounts shall be paid contemporaneously with consummation of the
acquisition, whether or not such Acquisition Proposal was solicited), such
number of shares and the Base Amount to be adjusted for stock splits, stock
dividends, stock combinations; recapitalizations, reclassifications and the
like. The Third Party Acquisition Consideration shall be deemed to include
both cash and any securities or other property received in the transaction, as
well as debts assumed in the transaction. In the event that any Third Party
Acquisition Consideration shall be payable in securities; debt securities
shall be valued at their market value on the day of delivery; preferred stock
shall be valued at market value on the day of delivery; and common stock shall
be valued by its market value on the day of delivery based on the ten day
average closing price of such common stock on the principal stock exchange or
Nasdaq market on which it is traded or quoted for the period prior to the
consummation of such acquisition. In the event that any Third Party
Acquisition Consideration shall be payable in other property, such other
property shall be valued at an amount to be reasonably determined by Republic.
10. Pre-Effective Date Operations of Addington. Republic is
proceeding on the basis that, at all times until the Effective Date, Addington
and its subsidiaries will take no actions other than actions in the ordinary
course of business and consistent with their past practices, and will use
their best efforts to preserve intact their business organization and good
will and preserve their relationships with their customers, suppliers and
others having business relations with them. Without limiting the foregoing,
neither Addington nor any of its subsidiaries will incur any additional
obligations, or prepay any obligations, for borrowed money (except that
Addington, acting in the ordinary course of business, may reasonably borrow
and repay under its existing line of credit), encumber assets, sell any assets
outside the ordinary course of business, declare or make any dividend or
distribution with respect to the Addington Common Stock, commit to material
capital expenditures or, other than in the ordinary course of business,
increase (or authorize an increase) in employee compensation or benefits. No
options or option plan of Addington may be amended or modified without the
prior written consent of Republic. Addington agrees to give notice in writing
to Republic promptly following the occurrence of any event which has had (or
which is likely to have) a material adverse effect upon its assets, business,
operations, prospects, properties or financial condition.
11. Capitalization. The authorized capital stock of Addington
consists solely of 30,000,000 shares of common stock, par value $1.00 per
share. As of the date hereof, 15,172,984 shares of Addington Common Stock are
issued and outstanding, and not more than 24,000 additional shares are
issuable upon exercise of vested stock grants. Except for the outstanding
options referred to in Paragraph 4 and set forth on Schedule A, Addington has
no outstanding securities convertible into, exchangeable for, or rights,
warrants or options to acquire, any shares of capital stock or other
convertible securities for Addington. In addition, neither Addington nor its
subsidiaries shall (i) issue, or authorize or propose the issuance of,
additional shares of capital stock of any class, or securities convertible
into, exchangeable for, or rights, warrants or options to acquire, any shares
or other convertible securities of Addington, other than shares of Addington
Common Stock issued upon the exercise of such presently outstanding stock
options or grants, nor, (ii) issue, or authorize or propose the issuance of,
any other securities in respect of, in lieu of, or in substitution for, its
now outstanding shares of Addington Common Stock.
12. Hart-Scott-Rodino Filing. Republic and Addington shall,
promptly following execution of the Merger Agreement, file or cause to be
filed under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder (the "HSR Act"),
a notification, in report form, with respect to the proposed transaction, and
each party shall respond promptly to any requests by authorized governmental
agencies to file such additional information and documentary materials as may
be requested pursuant to the HSR Act.
13. Expenses. Republic and Addington will bear their own
expenses (including, without limitation, fees, disbursements and other costs
of any finders, investment bankers, attorneys, accountants and other advisors)
in connection with this letter of intent, the Merger Agreement and the
transactions contemplated herein and therein, except that Republic and
Addington shall each bear 50% of the HSR Act filing fees payable with respect
to the Merger and Republic shall bear 100% of the SEC filing fee for the
Registration Statement.
14. Brokers. Addington represents to Republic that it has not,
and Republic represents to Addington that it has not, dealt with or engaged
any broker or finder in connection with the transactions contemplated hereby.
15. Public Disclosure. Neither party shall issue any press
release or otherwise publicize the transactions contemplated herein without
the consent and approval of the other; however, the parties hereto consent to
the issuance of the joint press release which the parties have simultaneously
herewith approved, providing copies hereof to governmental agencies in
connection with compliance with the HSR Act and to any other governmental
agency which counsel to a party may advise such party may be required, and
providing additional information, limiting in scope to the discussion
contained in the press release, in response to unsolicited questions resulting
from such press release or reports.
16. Conditions to Rising. Consummation of the transactions
contemplated herein shall be subject to, among other things, the following:
a. The execution of the Merger Agreement and other
agreements contemplated herein and therein containing terms and
conditions satisfactory to each party, which agreements will set forth
all definitive terms and conditions of the proposed transactions with
customary representations, warranties, covenants and indemnification
provisions.
b. Republic shall be satisfied with the results of its
due diligence review with respect to Addington's assets, business,
operations, prospects, properties and financial condition.
c. Addington shall be satisfied with the results of its
due diligence review of Republic.
d. The Merger shall have been approved and adopted by the
(a) Boards of Directors of each of Addington and Republic, and (b)
affirmative vote of the stockholders of Addington to the extent required
in accordance with Addington's charter and bylaws, the DGCL, and NASD
regulations.
e. The Boards of Directors of Addington and Republic
shall have received favorable opinions (if sought) as to the fairness of
the consideration to be received in the Merger from a financial point of
view.
f. The Republic Common Stock issuable pursuant to the
Merger and pursuant to the exercise of the options set forth in
Paragraph 4 shall have been authorized by NASD for listing on The Nasdaq
Stock Market.
g. The waiting period imposed by the HSR Act shall have
expired or been earlier terminated without the institution or threat of
governmental challenge to the Merger.
h. There shall not have been instituted or threatened any
action or proceeding before any court or administrative agency, by any
governmental agency or any other person, challenging or otherwise
relating to the Merger, or which otherwise would materially or adversely
affect Republic or Addington if determined adversely to Republic or
Addington.
i. There shall not have been any action, or any statute,
rule or regulation proposed or enacted, by any governmental authority or
agency which would render the parties unable to consummate the Merger or
make the Merger illegal or prohibit, restrict or delay consummation of
the Merger.
j. The parties shall have obtained all necessary third
party and governmental consents and approvals, including, without
limitation, applicable lenders to Republic and Addington.
k. There shall have been no material adverse change in
Addington's business, assets, results of operations, customer and
employee relations, or business prospects.
l. There shall have been no material change in Republic's
business, results of operations, or business prospects.
m. The Merger Agreement shall have been entered into
prior to the Termination Date.
[The balance of this page intentionally left blank]
<PAGE>
Kindly confirm that this letter of intent reflects our agreement in
principle by signing and returning a copy of this letter of intent to
Republic. Unless Republic receives such signed copy by 6:00 p.m.
Eastern Daylight Savings Time on Saturday, June 1, 1996, this letter of
intent shall be null and void. We look forward to moving ahead promptly
to finalize the proposed transactions.
Very truly yours,
REPUBLIC INDUSTRIES, INC.
By:/s/ Richard L. Hanley
Richard L. Hanley
Senior Vice President
CONFIRMED:
ADDINGTON RESOURCES, INC.
By:/s/ Howard P. Berkowitz
Howard P. Berkowitz
Chairman of the Board
HPB ASSOCIATES, INC.
By: HPB Group L.L.C.
/s/ Howard P. Berkowitz
Howard P. Berkowitz, Managing Member
/s/ Harold Blumenstein
Harold Blumenstein
/s/ James Grosfeld
James Grosfeld
/s/ Larry Addington
Larry Addington
/s/ Robert Addington
Robert Addington
/s/ Bruce Addington
Bruce Addington
