SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Amendment No. 1
American Resources of Delaware, Inc.
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(Name of Issuer)
Common Stock ($.00001 Par Value)
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(Title of Class of Securities)
02926 U 30 8
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(CUSIP No.)
Leonard K. Nave
Rick G. Avare
160 Morgan Street
Versailles, KY 40383
(606)873-5455
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Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications
September 11, 1996
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(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
Statement and is filing this Statement 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:
( )
1
<PAGE>
CUSIP NO. 13D
02926 U 30 8
- ------------------------------------------------------------------
1. NAME OF REPORTING PERSON
Leonard K. Nave, Trustee
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
-------
(b) X
-------
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
00
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2 (D) OR 2 (E)
--------
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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Number of 7. SOLE VOTING POWER
Shares None
-------------------------------
Beneficially 8. SHARED VOTING POWER
Owned By 993,623
-------------------------------
Each 9. SOLE DISPOSITIVE POWER
Reporting None
-------------------------------
Person 10. SHARED DISPOSITIVE POWER
With 993,623
- ------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
Leonard K. Nave, Trustee, beneficially owns 993,623 shares of
common stock of American Resources of Delaware, Inc.
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
SHARES
--------
- ------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.7%
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14. TYPE OF REPORTING PERSON
IN
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2
<PAGE>
CUSIP NO. 13D
02926 U 30 8
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1. NAME OF REPORTING PERSON
Southern Gas Holding Company, Inc.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
61-1200618
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
-------
(b) X
-------
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
00
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2 (D) OR 2 (E)
---------
- ------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Kentucky
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Number of 7. SOLE VOTING POWER
Shares None
-------------------------------
Beneficially 8. SHARED VOTING POWER
Owned By 993,623
-------------------------------
Each 9. SOLE DISPOSITIVE POWER
Reporting None
-------------------------------
Person 10. SHARED DISPOSITIVE POWER
With 993,623
- ------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
Southern Gas Holding Co. beneficially owns 993,623 shares of
common stock of American Resources of Delaware, Inc.
- ------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
SHARES
---------
- ------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.7%
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14. TYPE OF REPORTING PERSON
CO
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3
<PAGE>
CUSIP NO. 13D
02926 U 30 8
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1. NAME OF REPORTING PERSON
Leonard K. Nave
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
###-##-####
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
-------
(b) X
-------
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
BK, PF, OO
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2 (D) OR 2 (E)
--------
- ------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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Number of 7. SOLE VOTING POWER
Shares 275,639
-------------------------------
Beneficially 8. SHARED VOTING POWER
Owned By 1,141,105
-------------------------------
Each 9. SOLE DISPOSITIVE POWER
Reporting 275,639
-------------------------------
Person 10. SHARED DISPOSITIVE POWER
With 1,141,105
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
Leonard K. Nave beneficially owns 1,416,744 shares of common
stock OF American Resources of Delaware, Inc.
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
SHARES
---------
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
21.4%
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14. TYPE OF REPORTING PERSON
IN
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4
<PAGE>
CUSIP NO. 13D
02926 U 30 8
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1. NAME OF REPORTING PERSON
Rick G. Avare
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
###-##-####
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
-------
(b) X
-------
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
BK,PF,OO,SC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2 (D) OR 2 (E)
----------
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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Number of 7. SOLE VOTING POWER
Shares 751,086
-------------------------------
Beneficially 8. SHARED VOTING POWER
Owned By 1,289,721
-------------------------------
Each 9. SOLE DISPOSITIVE POWER
Reporting 751,086
-------------------------------
Person 10. SHARED DISPOSITIVE POWER
With 1,289,721
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
Rick G. Avare beneficially owns 2,040,807 shares of common
stock of American Resources of Delaware, Inc.
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
SHARES
----------
- ------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.0%
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14. TYPE OF REPORTING PERSON
IN
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5
<PAGE>
ITEM 1. Security and Issuer.
-------------------
This Schedule 13D relates to the common stock, $.00001 par
value, per share (the "Common Stock") of American Resources of
Delaware, Inc. ("ARI"), a Delaware corporation. ARI's principal
executive office is located at 160 Morgan Street, Versailles,
Kentucky 40383.
ITEM 2. Identity and Background.
-----------------------
This Schedule 13D is filed by Southern Gas Holding Company,
Inc., Leonard K. Nave, individually, Leonard K. Nave, Trustee and
Rick G. Avare, individually (the "Reporting Persons").
Individual Reporting Persons. The two individual Reporting
----------------------------
Persons, one of whom is also a trustee Reporting Person, and their
present principal occupations are listed below. Both persons are
citizens of the United States of America. During the last five
years, neither person has been convicted of any criminal
proceeding, excluding traffic violations or similar misdemeanors,
and neither person was a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction which resulted in
or subjected either person to 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.
Leonard K. Nave. Mr. Nave is principally occupied as Chairman
---------------
of the Board, Chief Executive Officer and President of Southern Gas
Company of Delaware, Inc., a wholly-owned subsidiary of ARI.
6
<PAGE>
Rick G. Avare. Mr. Avare is principally occupied as President
-------------
and Chief Executive Officer of ARI.
Corporate Reporting Person. The corporate Reporting Person is
--------------------------
Southern Gas Holding Company, Inc., a Kentucky corporation
("Southern Gas Holding"). Southern Gas Holding's principal business
is serving as a management company for oil and gas operations.
During the last five years, Southern Gas Holding has not been
convicted in any criminal proceeding, excluding traffic violations
or similar misdemeanors, and Southern Gas Holding was not a party
to a civil proceeding of a judicial or administrative body of
competent jurisdiction which resulted in or subjected it to 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.
The address of Southern Gas Holding's principal business and
principal office is 160 Morgan Street, Versailles, Kentucky 40383.
The only directors of Southern Gas Holding are Leonard K. Nave
and Rick G. Avare. The only executive officers of Southern Gas
Holding are Leonard K. Nave, President, and Rick G. Avare, Chairman
of the Board, Chief Executive Officer, Vice President, Secretary
and Treasurer.
Southern Gas Holding is authorized to issue 1,000 shares of
common stock, all of which are issued and outstanding. Leonard K.
Nave, Trustee, directly owns 325 shares (32.5%%), Leonard K. Nave,
individually, directly owns 75 shares (7.5%), Rick G. Avare
7
<PAGE>
directly owns 525 shares (52.5%) and Karen M. Underwood, Secretary
of ARI, directly owns 75 shares (7.5%).
Trustee Reporting Person. On April 30, 1990, Leonard K. Nave,
------------------------
as Grantor, entered into a Trust Agreement with himself, as sole
Trustee (the "Trust"). On the same date, Mr. Nave transferred to
the Trust 475 shares (47.5%) of common stock of Southern Gas
Holding. The Trust Agreement is irrevocable. The Trustee has the
sole power to vote and pledge the shares; however neither the
Trustee nor the beneficiaries have the power to sell the shares.
The Trust Agreement provides that the shares of Southern Gas
Holding shall be distributed to the persons identified below either
upon the liquidation and/or dissolution of Southern Gas Holding or
on April 30, 2000, whichever occurs first. However, Mr. Nave, in
his sole discretion, may make early distributions to one or more of
such persons:
<TABLE>
<S> <C>
Rick G. Avare.................75 shares*
Karen M. Underwood............75 shares**
Patricia H. Kittenger(1)......75 shares
William F. Nave, II(2)........75 shares
Leonard K. Nave, Jr.(2).......75 shares
Linda L. Nave (3)............100 shares
</TABLE>
Footnotes:
* Distributed on January 2, 1995.
** Distributed on January 4, 1996. .
(1) Mr. Nave's daughter.
(2) Mr. Nave's son.
(3) Mr. Nave's wife.
None of Mr. Nave's children reside in the same household
with Mr. Nave.
8
<PAGE>
ITEM 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
Southern Gas Holding. Prior to October 6, 1993, Southern Gas
--------------------
Holding owned 1,215 shares (81.0%) of common stock of Southern Gas
Company, Inc., a Kentucky corporation ("Southern Gas Kentucky"). As
reported in Southern Gas Kentucky's Schedule 13D dated March 3,
1994, which was previously filed with the Securities and Exchange
Commission, on October 6, 1993, ARI and Southern Gas Kentucky
entered into an Asset Purchase Agreement, as amended, ("Agreement")
a copy of which was filed as Exhibit A to Southern Gas Kentucky's
Schedule 13D and is incorporated herein by reference. The
transactions contemplated by the Agreement were consummated on
February 24, 1994. Under the Agreement, ARI acquired substantially
all of the assets of Southern Gas Kentucky in exchange for
5,717,981 shares of ARI Common Stock, which represented
approximately 49% of ARI's issued and outstanding common stock, and
the assumption of certain liabilities of Southern Gas Kentucky. As
part of the transaction, Southern Gas Kentucky agreed to
simultaneously transfer 811,200 shares of ARI Common Stock to Sequa
Capital Corporation, leaving Southern Gas Kentucky with 4,906,781
shares (46.8%) of ARI Common Stock.
ARI transferred the assets which it acquired from Southern Gas
Kentucky into ARI's wholly-owned subsidiary, Southern Gas Company
of Delaware, Inc.
On June 8, 1994, ARI split its common stock 4 to 1, which
resulted in Southern Gas Kentucky owning 1,226,695 shares of ARI
Common Stock. On June 22, 1994, as part of a complete liquidation,
9
<PAGE>
Southern Gas Kentucky distributed 993,623 shares of ARI Common
Stock to Southern Gas Holding and a total of 225,000 shares to
three other shareholders not affiliated with Southern Gas Holding
or Leonard K. Nave. The 8,072 shares retained by Southern Gas
Kentucky were distributed in November, 1994 with 4,036 shares being
transferred to Leonard K. Nave and 4,036 shares being transferred
to an individual not affiliated with Southern Gas Holding or
Leonard K. Nave. Subsequently, Southern Gas Kentucky was dissolved.
Leonard K. Nave. In addition to his beneficial ownership of
---------------
993,623 shares of ARI Common Stock resulting from Leonard K. Nave,
Trustee and individually, being a controlling stockholder of
Southern Gas Holding and the 4,036 shares of ARI Common Stock which
he received upon the liquidation of Southern Gas Kentucky, Mr. Nave
owns options to purchase the following shares of ARI Common Stock
for the exercise prices indicated. All of the options are
immediately exercisable and expire ten years after the date
granted:
<TABLE>
Date Granted Number of Shares Exercise Price
------------ ---------------- --------------
<C> <C> <C>
7-15-94 100,000 $6.00
2-2-95 100,000 $6.50
10-12-95 46,603 $3.50
3-5-96 25,000 $4.50
-------
Total Shares 271,603
=======
</TABLE>
Messrs. Leonard K. Nave, Douglas L Hawthorne, Andrew J. Kacic,
Donald A. Schellpfeffer and Rick G. Avare jointly own 147,482
shares of ARI Common Stock (1,478 shares received as a stock
dividend and 146,004 shares received on the conversion of 36,638
shares of ARI Series B Preferred Stock) for which Mr. Nave paid
$100,000 with funds borrowed as follows: [i] $58,334 from Bank One,
10
<PAGE>
Texas (however, the note due to Bank One, Texas is for the total
amount of $175,000 and is the joint and several obligation of all
parties to the note), with interest at prime plus 2%, due June 1,
1996 secured by a pledge of 146,004 shares of ARI Common Stock,
including Mr. Nave's one-fifth interest, or 29,200 shares; and [ii]
$41,666 from Douglas L. Hawthorne and Donald A Schellpfeffer, M.D.,
with interest at 11% per annum, payable on demand, secured by a
second lien on the aforementioned 146,004 shares.
Rick G. Avare. In addition to his beneficial ownership of
-------------
993,623 shares of ARI Common Stock resulting from his being a
controlling stockholder of Southern Gas Holding, Mr. Avare owns
beneficially, 147,482 shares of ARI Common Stock (1,478 shares
received as a common stock dividend and 146,004 shares issued on
the conversion of 36,368 shares of ARI Class B Preferred Stock)
owned by Prima Capital, LLC as a result of his ownership of a 20%
interest in Prima Capital, LLC. Mr. Avare is the sole
administrative officer of Prima Capital, LLC. Mr. Avare purchased
his 20% interest in Prima Capital, LLC for $200, which he purchased
with his own funds. Prima Capital, LLC purchased the 36,368 shares
of ARI Class B Preferred Stock for $500,000, which was paid to it
by ARI as part of the consideration for a Call Agreement between
ARI and Prima Capital, LLC relating to shares of capital stock of
Settle Oil and Gas Company. On September 11, 1996, Mr. Avare
purchased 187,500 shares of Preferred Stock and 70,328 shares of
$.0001 par value common stock (the "Common Stock") of ARI from Mr.
Howard Settle for an aggregate of $694,431.00 (the "Purchase
11
<PAGE>
Price"). Mr. Avare paid the full Purchase Price by assuming and
agreeing to pay the unpaid principal and accrued interest on two
promissory notes from Mr. Settle to Jamal Mashburn. A copy of an
agreement between Nr. Avare and Mr. Mashburn is attached hereto as
Exhibit 1-1 and incorporated herein. One of the promissory notes
(dated February 12, 1996 and due February 12, 1997) is in the
principal amount of $468,000 and bears interest at the rate of 12%
per annum. It is secured by a pledge of 187,500 shares of Preferred
Stock and 7,500 shares of Common Stock purchased by Mr. Avare from
Mr. Settle. The other promissory note (dated January 18, 1996 and
due January 18, 1997) is in the principal amount of $180,000 and
bears interest at the rate of 12% per annum. It is secured by a
pledge of 55,328 shares of Common Stock purchased by Mr. Avare from
Mr. Settle. Each one share of Preferred Stock is convertible into
one share of Common Stock at the option of the holder.
Mr. Avare owns options to purchase the following shares of ARI
Common Stock for the exercise prices indicated. All of the options
are immediately exercisable and expire ten years after the date
granted:
<TABLE>
Date Granted Number of Shares Exercise Price
------------ ---------------- --------------
<C> <C> <C>
7-15-94 50,000 $6.00
2-2-95 125,000 $6.50
10-12-95 93,204 $3.50
3-5-96 225,000 $4.50
-------
Total Shares 493,204
=======
</TABLE>
Mr. Avare indirectly owns 1,134 shares of ARI Common Stock by
virtue of his ownership of a 1/3 interest in JJR Investments, a
12
<PAGE>
general partnership organized under the laws of the Commonwealth of
Kentucky, which he purchased with his personal funds for $2,268.
The remaining partnership interests are owned by Joseph A. and John
J. Iracane, both of whom are residents of the United States. Joseph
A. Iracane is self-employed in the jewelry industry and John A.
Iracane is principally employed as a marketing manager for Southern
Gas Co. of Delaware. During the last five years, neither person has
been convicted of any criminal proceeding, excluding traffic
violations or similar misdemeanors, and neither person was a party
to a civil proceeding of a judicial or administrative body of
competent jurisdiction which resulted in or subjected either person
to 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.
In addition, Messrs. Leonard K. Nave, Douglas L Hawthorne,
Andrew J. Kacic, Donald A. Schellpfeffer and Rick G. Avare jointly
own 147,482 shares of ARI Common Stock (1,478 shares received as a
stock dividend and 146,004 shares received on the conversion of
36,638 shares of ARI Series B Preferred Stock) for which Mr. Avare
paid $100,000 with funds borrowed as follows: [i] $58,334 from Bank
One, Texas (however, the note due to Bank One, Texas is for the
total amount of $175,000 and is the joint and several obligation of
all parties to the note), with interest at prime plus 2%, due June
1, 1996 secured by a pledge of 146,004 shares of ARI Common Stock,
including Mr. Avare's one-fifth interest, or 29,200 shares; and
13
<PAGE>
[ii] $41,666 from Douglas L. Hawthorne and Donald A Schellpfeffer,
M.D., with interest at 11% per annum, payable on demand, secured by
a second lien on the aforementions 146,004 shares.
ITEM 4. Purpose of Transaction.
----------------------
The Reporting Persons acquired the shares of ARI Common Stock
reported herein because they believe them to be a good investment
and for the purpose of influencing the management and control of
ARI. Other than as set forth herein, the Reporting Persons have no
individual or collective present plans, arrangements,
understandings or intent to cause ARI to be merged or liquidated,
to sell any assets of ARI, to cause the ARI Common Stock to cease
to be authorized for quotation on an inter-dealer quotation system
or a registered national securities association or to become
eligible for termination of registration pursuant to Section
12(g)(4) of the Securities Exchange Act of 1934, as amended, or to
cause ARI to change its charter, bylaws, capitalization, dividend
policy, business, corporate structure or present board of directors
or management. From time to time in the future, one or more of the
Reporting Persons may purchase additional shares of ARI Common
Stock at varying prices in the open market, in privately negotiated
transactions and/or in other transactions.
14
<PAGE>
ITEM 5. Interest in Securities of the Issuer.
------------------------------------
(a) At August 30, 1996, 6,346,572 shares of Common Stock
were issued and outstanding. The reporting persons identified in
ITEM 2 above, beneficially own the following shares of ARI Common
Stock:
<TABLE>
Reporting Person No. Shares Percent
---------------- ---------- -------
<S> <C> <C>
Southern Gas Holding 993,623 (12.7%)
Leonard K. Nave, Trustee 993,623 (12.7%)
Leonard K. Nave 1,416,744 (17.5%)
Rick G. Avare 2,040,807 (23.9%)
</TABLE>
(b) The reporting persons have the following sole or shared
power to vote shares of ARI Common Stock ("Voting Power") and the
sole or shared power to dispose of shares of ARI Common Stock
("Investment Power"):
Southern Gas Holding:
Sole Voting Power None
Shared Voting Power 993,623 (1)
Sole Investment Power None
Shared Investment Power 993,623 (1)
Leonard K. Nave, Trustee:
Sole Voting Power None
Shared Voting Power 993,623 (1)
Sole Investment Power None
Shared Investment Power 993,623 (1)
Leonard K. Nave
Sole Voting Power 275,639 (2)
Shared Voting Power 1,141,105 (3)
Sole Investment Power 275,639 (2)
Shared Investment Power 1,141,105 (3)
Rick G. Avare:
Sole Voting Power 751,086 (4)
Shared Voting Power 1,289,721 (5)
Sole Investment Power 751,086 (4)
Shared Investment Power 1,289,721 (5)
Footnotes:
(1) Shares owned of record by Southern Gas Holding.
15
<PAGE>
(2) Shares and options to purchase shares owned of
record by Leonard K. Nave, individually.
(3) 993,623 shares owned of record by Southern Gas
Holding and 147,482 shares owned jointly by Leonard
K. Nave, Douglas L. Hawthorne, Andrew J. Kacic,
Donald A. Schellpfeffer and Rick G. Avare, all of
whom are directors of ARI.
(4) Shares, options and conversion rights owned of
record by Rick G. Avare.
(5) 993,623 shares owned of record by Southern Gas
Holding, 147,482 shares owned of record by Prima
Capital LLC, 1,134 shares owned of record by JJR
Investments and 147,482 shares owned jointly by Rick
G.Avare, Leonard K. Nave, Andrew J. Kacic, Douglas
L. Hawthorne and Donald A. Schellpfeffer, all of
whom are directors of ARI.
Leonard K. Nave disclaims the beneficial ownership of 60% of
the shares of ARI Common Stock owned of record by Southern Gas
Holding and 80 % of the shares of ARI Common Stock owned jointly by
Messrs. Nave, Hawthorne, Kacic, Schellpfeffer and Avare. Rick G.
Avare disclaims the beneficial ownership of 47.5% of the shares of
ARI Common Stock owned of record by Southern Gas Holding, 80% of
the shares of ARI Common Stock owned of record by Prima Capital LLC
and 80% of the shares of ARI Common Stock owned jointly by Messrs.
Nave, Hawthorne, Kacic, Schellpferrer and Avare. The filing of this
Schedule 13D shall not be construed as an admission by either
Leonard K. Nave or Rick G. Avare that such persons, for the
purposes of Section 13(d) or 13(g) of the Securities Exchange Act
of 1934, as amended, is the beneficial owner of such shares of ARI
Common Stock.
16
<PAGE>
ITEM 6. Contracts, Arrangements, Understandings or Relationships
--------------------------------------------------------
With Respect to Securities of the Issuer.
- ----------------------------------------
Except as otherwise disclosed in this Schedule 13D, none of
the reporting persons has any contracts, arrangements,
understandings or relationships among themselves or with any other
persons with respect to any securities of ARI.
ITEM 7. Material to be Filed as Exhibits.
--------------------------------
The following exhibits which were either filed with or
incorporated by reference into the original Schedule 13D are
incorporated herein by reference.
DESCRIPTION EXHIBIT
----------- -------
Asset Purchase Agreement dated October
6, 1993 between American Resources of
Delaware, Inc. and Southern Gas Company,
Inc. filed with the Securities and Ex-
change Commission on October 19, 1993 as
Exhibit 1.1 to American Resources of
Delaware, Inc.'s Current Report on Form 8-K
is incorporated herein by reference. A
Agreement among Southern Gas Holding Company,
Inc., Leonard K. Nave and Rick G. Avare
pursuant to Rule 13d-1(f)(1)(iii) filed as
as Exhibit B to the Reporting Persons'
Original Schedule 13D is incorporated herein
by reference. B
The following exhibit is attached hereto and
incorporated herein:
Agreement dated September 11, 1996 between
Rick G. Avare and Jamal Mashburn. 1-1
17
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of our knowledge
and belief, we certify that the information set forth in this
statement is true, complete and correct.
Date: September 19, 1996
s/Leonard K. Nave
----------------------------------
Leonard K. Nave, Individually
s/Leonard K. Nave
----------------------------------
Leonard K. Nave, Trustee
s/Rick G. Avare
----------------------------------
Rick G. Avare, Individually
Southern Gas Holding Company,Inc.
By: s/Leonard K. Nave
-------------------------------
Leonard K. Nave
President
18
<PAGE>
EXHIBIT 1-1
THIS AGREEMENT, made and entered into this 11th day
of September, 1996, by and between RICK G. AVARE, of Lexington,
Kentucky, hereinafter called "Avare;" and JAMAL MASHBURN, of
Irving, Texas, hereinafter called "Mashburn;"
WITNESSETH:
THAT, WHEREAS, Mashburn has previously loaned funds
to Howard A. Settle ("Settle") in the following amounts and for the
following purposes: (i) One Hundred Eighty Thousand ($180,000.00)
Dollars for the purpose of purchasing 55,328 shares of common stock
of American Resources of Delaware, Inc. ("ARI"); and (ii) Four
Hundred Sixty-eight Thousand ($468,000.00) Dollars for the purpose
of purchasing 187,500 shares of preferred stock and 7,500 shares of
common stock of ARI, said preferred shares having subsequently
earned an additional 7,500 shares in common stock dividends; and
WHEREAS, Avare is desirous of acquiring the
aforesaid stock in ARI from Settle and has reached an agreement
with Settle wherein Avare will assume the loans from Mashburn in
full in return for said stock; and
WHEREAS, Mashburn is willing for Avare to assume the
aforesaid loans under certain terms and conditions; and
WHEREAS, the parties hereto are desirous of setting
out their agreements in writing.
NOW, THEREFORE, for and in consideration of the
mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Avare agrees to assume the aforedescribed loans
from Mashburn to Settle in the principal amounts of Four Hundred
Sixty-eight Thousand ($468,000.00) Dollars and One Hundred Eighty
Thousand ($180,000.00) Dollars, both with interest at the rate of
twelve (12%) percent per annum, due and payable one (1) year from
the date hereof.
2. Avare agrees to execute a new promissory note in
favor of Mashburn in the total amount of Six Hundred Ninety-four
Thousand Four Hundred Thirty-one ($694,431.00), such note to set
out the terms of the loan and to be in the form attached hereto as
Exhibit A.
3. Avare agrees to pledge the subject stock of ARI
as collateral for the loan and agrees to execute the documents
necessary to evidence such encumbrance, including, but not limited
to, a stock power.
4. Avare agrees that at such time as he sells or
otherwise transfers all or a portion of the ARI stock, the proceeds
received from such sale or transfer shall be applied first towards
the payment of accrued interest on the loan and second towards the
payment of the principal balance, with the remainder, if any, being
shared equally between the parties.
5. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs and
assigns.
6. This Agreement contains the entire agreement and
understanding of the parties hereto with respect to the subject
matter hereof, and no other representations, promises, agreements
or understandings regarding the subject matter hereof shall be of
any force or effect unless in writing, executed by the party or
parties to be bound and dated on or subsequent to the date hereof.
IN WITNESS WHEREOF, the parties hereto have caused
the execution hereof as of the day and year first above written.
/S/Rick G. Avare
-----------------------------------
RICK G. AVARE
/S/Jamal Mashburn
-----------------------------------
JAMAL MASHBURN
