EXHIBIT 5.1
[LETTERHEAD OF LATHAM & WATKINS APPEARS HERE]
__________________, 1999
AEI Resources, Inc.
AEI Holding Company, Inc.
1500 North Big Run Road
Ashland, Kentucky 41102
Re: $200,000,000 Aggregate Principal Amount of 10-1/2%
Senior Notes due 2005 of AEI Resources, Inc. and
AEI Holding Company, Inc.
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Ladies and Gentlemen:
In connection with the issuance of $200,000,000 aggregate principal
amount of 10-1/2% Senior Notes due 2005 (the "Exchange Notes") by AEI Resources,
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Inc., a Delaware corporation, and AEI Holding Company, Inc., a Delaware
corporation (together, the "Issuers"), registered under the Securities Act of
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1933, as amended, on Form S-4 filed with the Securities and Exchange Commission
(the "Commission") on ________________, 1999 (File Numbers 333-72327 and
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333-72355) (as amended, the "Registration Statement"), relating to the offer
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(the "Exchange Offer") by the Issuers to exchange their outstanding 10-1/2%
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Senior Notes due 2005 (the "Old Notes") for Exchange Notes, you have requested
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our opinion with respect to the matters set forth below. The Old Notes were
issued pursuant to an indenture (the "Indenture"), dated as of December 14,
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1998, among the Issuers, the Guarantors party thereto and State Street Bank and
Trust Company, as trustee (the "Trustee"). This opinion is being rendered
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pursuant to Sections 7.02(b) and 11.05 of the Indenture with respect to the
authentication and delivery by the Trustee of the Exchange Notes issued on
________________, 1999 pursuant to Section 2.02 of the Indenture. Capitalized
terms not defined herein shall have the meanings assigned to them in the
Indenture.
LATHAM & WATKINS
________________, 1999
Page 2
In our capacity as special counsel to the Issuers, we have made such
legal and factual examinations and inquiries, including an examination of
originals or copies certified or otherwise identified to our satisfaction of
such documents, corporate records and instruments, as we have deemed necessary
or appropriate for purposes of this opinion. In our examination, we have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals and the conformity to authentic original documents
of all documents submitted to us as copies.
We have examined (i) the Indenture, (ii) the form of the Exchange Notes
set forth as an Exhibit to the Indenture, (iii) the Registration Statement, (iv)
the final prospectus, dated ________________, 1999, relating to the Exchange
Offer, (v) an authentication order, dated ________________, 1999, from the
Issuers to the Trustee with respect to the delivery of the exchange Notes and
ordering the Trustee to authenticate them up to $200,000,000 aggregate principal
amount (the "Authentication Order"), (vi) the officers' Certificate, dated
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__________________, 1999, delivered to the Trustee by the Issuers pursuant to
Sections 7.02(b) and 11.05 of the Indenture (the "Officers' Certificate") and
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(vii) certain resolutions of the Boards of Directors of the Issuers.
We are opining herein as to the effect on the subject transaction only
of the federal laws of the United States and the internal laws of the State of
New York, and we express no opinion with respect to the applicability thereto,
or the effect thereon, of the laws of any other jurisdiction or as to any
matters of municipal law or the laws of any other local agencies within any
state.
Subject to the foregoing and the other matters set forth herein, it is
our opinion that, as of the date hereof:
1. Upon (a) the delivery to the Trustee of the Authentication Order and
the Officers' Certificate and (b) the due tender and delivery to the Trustee of
the Old Notes in an aggregate principal amount equal to the aggregate principal
amount of the Exchange Notes and the acceptance of such Old Notes by the Company
for exchange in the Exchange Offer, all of the conditions set forth in the
Indenture with respect to the authentication and delivery by the Trustee of the
Exchange Notes in the amount set forth in the Authentication Order (such amount
not to exceed $200,000,000 aggregate principal amount) will have been complied
with.
2. The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended.
LATHAM & WATKINS
________________, 1999
Page 2
This opinion is furnished to you solely for your benefit in connection
with the issuance of the Exchange Notes. This opinion may not be relied upon by
you for any other purpose, or furnished to, quoted to, or relied upon by any
other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,