Kentucky coal operator Larry C. Addington has filed for personal bankruptcy protection, linked to a number of business debts that he guaranteed personally.
Addington became a well-known name in the coal industry in recent decades as he and his family led Ashland-based AEI Resources Holding Inc., which at one time was among the nation's largest coal producers. The company eventually filed for bankruptcy protection after Larry Addington had left his position as chief executive.
He went on to run Appalachian Fuels, which filed for bankruptcy protection in 2009. It was in his capacity with that firm, according to records, that he began signing guarantees that led to his personal bankruptcy filing on Jan. 26.
His attorney, Donald Mallory of Cohen, Todd, Kite & Stanford in Cincinnati, said Addington declined to comment on the case.
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In the filings, Mallory noted that Addington was diagnosed with throat cancer in 2006 and underwent multiple surgeries.
"During his illness and ensuing treatment, (Addington) was approached by Appalachian Fuels LLC personnel and asked to sign many personal guarantees for equipment purchases," the filing states. "Up until this point in his 30-year career, (Addington) had always refused to sign any personal guarantees.
"However, during this vulnerable time, he signed several personal guarantees totaling millions of dollars of exposures."
In his filing, Addington listed assets of $7.12 million and liabilities, primarily business debts, of $37.28 million.
Among the largest unsecured creditors is Caterpillar Financial Services Corp., which is owed $9.5 million for leased equipment that was personally guaranteed, according to the filing.
Mallory said the filing was "fairly typical in a lot of ways as to the issue with personal guarantees."
"It was his practice not to issue personal guarantees, but during his illness, that sort of changed, and with personal guarantees, everyone started coming at once to collect," Mallory said.
He added that bankruptcy "would be the best way to deal with everyone on a fair and equitable basis to give him the fresh start he needs to go forward."