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
Date of Report (Date of earliest event reported) December 19, 2005
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AMERICAN BILTRITE INC.
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(Exact name of registrant as specified in charter)
Delaware 1-4773 04-1701350
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(State or other jurisdiction (Commission File No.) (IRS Employer
of Incorporation) Identification No.)
57 River Street, Wellesley Hills, Massachusetts 02481-2097
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(Address of principal executive offices, including zip code)
(781) 237-6655
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(Registrant's telephone number, including area code)
Not Applicable
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(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:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On December 19, 2005, American Biltrite Inc.'s majority-owned subsidiary
Congoleum Corporation ("Congoleum") entered into an amendment (the "Amendment")
to Congoleum's debtor-in-possession credit facility, particularly the
Ratification and Amendment Agreement and Loan and Security Agreement, with
Wachovia Bank, National Association, the lender under Congoleum's
debtor-in-possession credit facility. The amendment extended the maturity date
of that facility for a year, until December 31, 2006. The Bankruptcy Court,
approved the Amendment at a hearing held on December 19, 2005.
Item 2.03 Creation of a Direct Financial Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
The disclosure under Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
Item 8.01 Other Events.
On December 21, 2005, Congoleum announced that active negotiations are underway
with respect to the terms of a new plan of reorganization, which Congoleum
expects to file with the Bankruptcy Court by February 3, 2006. Congoleum further
announced that in connection with these negotiations, Congoleum anticipates that
the trustee for the holders of Congoleum's 8.625% senior notes due in August
2008 will ask that a committee of bondholders be formed to negotiate treatment
of their claims under the new plan. The Bankruptcy Court has scheduled a hearing
on April 13, 2006 to consider the adequacy of the plan disclosure statement. In
addition, Congoleum announced that it now appears that achieving a consensual
plan with the asbestos claimants is going to require concessions on the part of
Congoleum's bondholders, as well as concessions on the part of Congoleum's
shareholders, which would include American Biltrite Inc. Congoleum further
stated that it hoped that any new plan would be confirmed during the second half
of 2006.
On December 31, 2003, Congoleum filed a voluntary petition with the United
States Bankruptcy Court for the District of New Jersey (Case No. 03-51524)
seeking relief under Chapter 11 of the United States Bankruptcy Code as a means
to resolve claims asserted against it related to the use of asbestos in its
products decades ago.
Forward-Looking Statements
Some of the information presented in this Current Report on Form 8-K constitutes
"forward-looking statements," within the meaning of the Private Securities
Litigation Reform Act of 1995, that involve risks, uncertainties and
assumptions. These forward-looking statements are based on American Biltrite
Inc.'s expectations, and American Biltrite Inc.'s understanding of Congoleum's
expectations, as of the date of this report, of future events, and American
Biltrite Inc. undertakes no obligation to update any of these forward-looking
statements except as required by the federal securities laws. Although American
Biltrite Inc. 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. There can be no assurance that Congoleum will be
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successful in obtaining confirmation of any Chapter 11 plan of reorganization in
a timely manner or at all. Any plan of reorganization pursued by Congoleum or
confirmed by the bankruptcy court could vary significantly from the most recent
version of the plan filed with the Bankruptcy Court by Congoleum, including with
respect to the matters described in this report. Furthermore, the estimated
costs and contributions required to confirm and to effect any plan of
reorganization could be significantly greater than currently estimated. Any plan
of reorganization pursued by Congoleum will be subject to numerous conditions,
approvals and other requirements, including bankruptcy court approvals, and
there can be no assurance that such conditions, approvals and other requirements
will be satisfied or obtained.
Some additional factors that could cause actual results to differ from
Congoleum's and American Biltrite Inc.'s objectives for resolving asbestos
liability 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 and American Biltrite Inc. for asbestos-related claims;
(iii) the costs relating to the execution and implementation of any plan of
reorganization pursued by Congoleum; (iv) timely reaching an agreement with
other creditors, or classes of creditors, that exist or may emerge; (v) American
Biltrite Inc.'s and Congoleum's satisfaction of the conditions and obligations
under their respective outstanding debt instruments, and amendment of those
outstanding debt instruments, as necessary, to permit Congoleum and American
Biltrite Inc. to satisfy their obligations under Congoleum's proposed plan of
reorganization; (vi) the response from time-to-time of American Biltrite Inc.'s
and Congoleum's lenders, customers, suppliers and other constituencies to the
Chapter 11 process and related developments arising from the strategy to settle
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 and
the overruling by the bankruptcy court of any objections that may be filed in
connection with the plan; (ix) developments in, costs associated with and the
outcome of insurance coverage litigation pending in New Jersey State Court
involving Congoleum and certain insurers; (x) developments in, and the outcome
of, proposed federal legislation that, if adopted, would establish a national
trust to provide compensation to victims of asbestos-related injuries that would
be funded in part by assessments against companies with asbestos-related
liabilities such as American Biltrite Inc. and Congoleum; and (xi) compliance
with the Bankruptcy Code, including section 524(g). In addition, in view of
American Biltrite Inc.'s relationships with Congoleum, American Biltrite Inc.
could be affected by Congoleum's negotiations, and there can be no assurance as
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to what that impact, positive or negative, might be. In any event, the failure
of Congoleum to obtain sufficient creditor and court approval of a Congoleum
plan of reorganization and confirmation and consummation of that plan would have
a material adverse effect on Congoleum's business, results of operations or
financial condition and could have a material adverse effect on American
Biltrite Inc.'s business, results of operations or financial condition. Other
factors that could cause or contribute to actual results differing from its
expectations include those factors discussed in American Biltrite Inc.'s other
filings with the Securities and Exchange Commission, including its Annual Report
on Form 10-K for the fiscal year ended December 31, 2004 and Quarterly Report on
Form 10-Q for the quarter ended September 30, 2005.
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SIGNATURES
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.
Date: December 23, 2005 AMERICAN BILTRITE INC.
By: /s/ Howard N. Feist III
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Name: Howard N. Feist III
Title: Chief Financial Officer
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