UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
Current
Report Pursuant to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
February 8,
2010
Date
of Report (Date of earliest event reported)
Congoleum
Corporation
(Exact
name of registrant as specified in its charter)
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Delaware
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01-13612
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02-0398678
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(State
or other jurisdiction of
incorporation)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
No.)
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3500
Quakerbridge Road
P.O.
Box 3127
Mercerville, NJ
08619-0127
(Address
of principal executive offices and zip code)
609-584-3000
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address,
if
changed since last report.)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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¨
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Written
communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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ITEM
8.01 OTHER EVENTS
On
February 12, 2010, the Asbestos Claimants' Committee, the Bondholders’
Committee, the Futures Representative and Congoleum Corporation (“Congoleum”)
jointly filed a revised plan of reorganization (the “Third Amended Joint Plan”)
and disclosure statement with the United States District Court for the District
of New Jersey (the “District Court”). The District Court has scheduled a hearing
to consider the adequacy of the disclosure statement for the Third Amended Joint
Plan for March 12, 2010. The terms of the Third Amended Plan are substantially
similar to those of the previous reorganization plan filed in October
2009.
As recently announced, Congoleum has reached a $100
million settlement with nine insurance groups and the New Jersey insurance
guaranty associations, and a hearing to approve that settlement is scheduled for
February 19, 2010. A settlement with another insurer for $2.1 million
has been reached and will also be heard on that date. Congoleum will
additionally be seeking approval of the $25 million settlement it reached in
2006 with Travelers Casualty and Surety Company and St. Paul Fire and
Marine Insurance Company. A further
twelve insurance settlements totaling $82 million are in force and have already
received court approval. Net proceeds from these settlements are
payable to the plan trust that will be formed for asbestos claimants after a
plan becomes effective. In the event the Court approves the
settlements being heard February 19, 2010, only one insurer, Chartis (formerly
known as AIG), remains unsettled because a prior settlement agreement has been
declared expired.
Copies of the Third Amended Plan and
the related proposed disclosure statement will be filed in March with
Congoleum’s Annual Report on Form 10-K for the year ended December 31,
2009.
The
above contains certain forward-looking statements, within the meaning of the
Private Securities Litigation Reform Act of 1995, that involve risks,
uncertainties and assumptions. These statements can be identified by the use of
the words such as "anticipate," "believe," "estimate," "expect," "intend,”
"plan," "project" and other words of similar meaning. In particular, these
include statements relating to intentions, beliefs or current expectations
concerning, among other things, future performance, results of operations, the
outcome of contingencies such as bankruptcy and other legal proceedings, and
financial conditions. These statements do not relate strictly to historical or
current facts. These forward-looking statements are based on Congoleum's
expectations, as of the date of this Current Report on Form 8-K, of future
events, and Congoleum undertakes no obligation to update any of these
forward-looking statements.
Although
Congoleum believes that these expectations are based on reasonable assumptions,
within the bounds of its knowledge of its business and operations, there can be
no assurance that actual results will not differ materially from its
expectations. Readers are cautioned not to place undue reliance on any
forward-looking statements. Any or all of these statements may turn out to be
incorrect. By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on circumstances that may
or may not occur in the future. Any forward-looking statements made in this
Current Report on Form 8-K speak only as of the date of such report. It is not
possible to predict or identify all factors that could potentially cause actual
results to differ materially from expected and historical results. Factors that
could cause actual results to differ from expectations include: (i) the future
cost and timing of estimated asbestos liabilities and payments, (ii) the
availability of insurance coverage and reimbursement from insurance companies
that underwrote the applicable insurance policies for Congoleum for
asbestos-related claims, (iii) the costs relating to the execution and
implementation of any plan of reorganization pursued by Congoleum, (iv) timely
reaching agreement with other creditors, or classes of creditors, that exist or
may emerge, (v) satisfaction of the conditions and obligations under Congoleum's
outstanding debt instruments, (vi) the response from time to time of Congoleum's
and its controlling shareholder's, American Biltrite Inc.'s, lenders, customers,
suppliers and other constituencies to the ongoing process arising from
Congoleum's strategy to settle its asbestos liability, (vii) Congoleum's ability
to maintain debtor-in-possession financing sufficient to provide it with funding
that may be needed during the pendency of its Chapter 11 case and to obtain exit
financing sufficient to provide it with funding that may be needed for its
operations after emerging from the bankruptcy process, in each case, on
reasonable terms, (viii) timely obtaining sufficient creditor and court approval
of any reorganization plan pursued by Congoleum (including the results of any
relevant appeals), (ix) compliance with the United States Bankruptcy Code,
including Section 524(g), (x) costs of, developments in, and the outcome of
insurance coverage litigation pending in New Jersey state court involving
Congoleum and certain insurers, (xi) the possible adoption of another party's
plan of reorganization which may prove to be unfeasible, (xii) increases in raw
material and energy prices or disruption in supply, (xiii) increased competitive
activity from companies in the flooring industry, some of which have greater
resources and broader distribution channels than Congoleum, (xiv) increases in
the costs of environmental compliance and remediation or the exhaustion of
insurance coverage for such expenses, (xv) unfavorable developments in the
national economy or in the housing industry in general, including developments
arising from the war in Iraq and Afghanistan and from the tightening of credit
availability, (xvi) shipment delays, depletion of inventory and increased
production costs resulting from unforeseen disruptions of operations at any of
Congoleum's facilities or distributors, (xvii) product warranty costs, (xviii)
changes in distributors of Congoleum's products, and (xix) Congoleum’s interests
may not be the same as its controlling shareholder, American Biltrite
Inc. In any event, if Congoleum is not successful in obtaining
sufficient creditor and court approval of a plan of reorganization, such failure
would have a material adverse effect upon its business, results of operations
and financial condition. In the event that the modified plan is confirmed and
becomes effective, holders of existing common shares of Congoleum will receive
nothing on account of their interests and their shares will be cancelled. Actual
results could differ significantly as a result of these and other factors
discussed in Congoleum's annual report on Form 10-K for the year ended December
31, 2008 and subsequent filings made by Congoleum with the Securities and
Exchange Commission.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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Date: February
12, 2010
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Congoleum
Corporation
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By:
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/s/ Howard N. Feist
III
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Name: Howard
N. Feist III
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Title: Chief
Financial Officer
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