Exhibit 10.2.1
FIRST AMENDMENT TO COLLATERAL TRUST AGREEMENT
This first amendment to the Collateral Trust Agreement ("Amendment to the
Collateral Trust Agreement") is entered into by and among Congoleum Corporation,
a Delaware Corporation ("Congoleum"), Xxxxxx X. Xxxxxxxxx, solely in his
capacity as the Collateral Trustee hereunder (the "Collateral Trustee") and
Wilmington Trust Company, a Delaware banking corporation, solely in its capacity
as Delaware Trustee (the "Delaware Trustee") (Congoleum, the Collateral Trustee,
and the Delaware Trustee, collectively, the "Parties"), with the consent of
Claimants' Counsel, as designated in the Settlement Agreement Between Congoleum
Corporation And Various Asbestos Claimants.
RECITALS
WHEREAS Congoleum, the Collateral Trustee and the Delaware Trustee entered
into the Collateral Trust Agreement pursuant to which a statutory trust under
the Delaware Statutory Trust Act was created on April 17, 2003; and
WHEREAS, Congoleum and various Asbestos Claimants executed a settlement
agreement dated April 10, 2003, titled Settlement Agreement Between Congoleum
Corporation and Various Asbestos Claimants (the "Claimant Agreement"); and
WHEREAS, Congoleum and various Asbestos Claimants contemporaneously
herewith are executing that certain first amendment to the Claimant Agreement
(the "Amendment to the Claimant Agreement"); and
WHEREAS, on or about April 11, 2003 and April 17, 2003, respectively,
Congoleum executed agreements titled "Security Agreement" and "Second Security
Agreement" (collectively, the "Security Agreements") granting to the Collateral
Trust a present and continuing security interest in certain insurance proceeds;
and
WHEREAS, Congoleum and the Collateral Trustee contemporaneously herewith
have terminated the Security Agreements by the means of the Termination
Agreement and entered into a subsequent security agreement ("Superceding
Security Agreement"); and
WHEREAS, the Parties desire to enter into this Amendment to the Collateral
Trust Agreement to confirm their agreement with respect to (i) the termination
of the Security Agreements; (ii) the execution of the Superceding Security
Agreement, (iii) certain technical corrections to the Collateral Trust
Agreement; and (iv) certain other matters relating to the foregoing, as
hereafter provided; and
WHEREAS, Section IV.D. of the Collateral Trust Agreement authorizes the
Trustee, with the unanimous consent of Congoleum and Claimants' Counsel to
modify and amend the Collateral Trust Agreement.
NOW, THEREFORE, the Parties hereby agree that the Collateral Trust
Agreement shall be amended as follows:
AGREEMENT
1. The paragraph below shall be added to the Claimant Agreement as Section
I.C:
C. Nontransferability of Beneficial Interests. The beneficial interests in
the Collateral Trust are not transferable or assignable, except as may be
provided under operation of law or after the death of an Asbestos Claimant
pursuant to a will or the law applicable to decedent's estates. The
beneficial interests in the Collateral Trust shall not be evidenced by a
separate certificate. Nothing in this paragraph I.C shall in any way
restrict the ability of the Collateral Trust to transfer the Trust Assets
to any trust established pursuant to a plan of reorganization for
Congoleum under chapter 11 of the United States Bankruptcy Code.
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2. Sections II.E.1 and 2 of the Collateral Trust Agreement shall be replaced
in their entirety with:
E. Enforcement of Security Interest.
The Collateral Trustee shall have the power and authority to enforce the
Collateral Trust's interest in the Collateral in accordance with the
Superceding Security Agreement and applicable law.
3. Sections IV.C and IV.D of the Collateral Trust Agreement shall be replaced
in their entirety with:
C. Termination. The Collateral Trust shall terminate upon the earliest of:
(i) the payment in full of all of the Participating Asbestos Claimant's
Secured Claims and the distribution of all Trust Assets pursuant to the
terms of this Collateral Trust Agreement; (ii) the distribution of all
Trust Assets pursuant to the terms of this Collateral Trust Agreement and
the Collateral Trustee's determination that no further steps to recover
any assets subject to the Security Interest are commercially reasonable;
(iii) the transfer of the Trust Assets to the Plan Trust pursuant to the
terms of this Collateral Trust Agreement; (iv) the payment of the Trust
Assets to Congoleum pursuant to the terms of Section II.B.5; or (v) the
expiration of any Perpetuities Period applicable to the Collateral Trust,
provided that, to the extent permitted by applicable law, Congoleum
directs that the Rule Against Perpetuities shall not apply to the
Collateral Trust and that the Collateral Trust shall not be limited by a
Perpetuities Period. "Perpetuities Period" shall mean the period (if any)
defined by any applicable rule against perpetuities (the "Applicable
Rule") within which interests in the Collateral Trust must vest in order
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to be valid when created. The Perpetuities Period includes any period in
gross permitted by the Applicable Rule, such as twenty-one (21) years. If
the Perpetuities Period is defined with reference to a given date or the
death of the last survivor of a class of individuals living on a given
date (the "Measuring Lives"), the date shall be the date prescribed by the
Applicable Rule and the Measuring Lives shall be the members of the class
of persons living on that date who are authorized to receive any payment
from the Collateral Trust prior to its termination. If the Applicable Rule
applies differently to different kinds of Trust Assets, a direction to
terminate the Collateral Trust upon the expiration of the Perpetuities
Period shall be applied separately to the different kinds of property. If
Trust Assets transferred to the Collateral Trustee at different times have
different Perpetuities Periods, a direction to terminate the Collateral
Trust upon the expiration of the Perpetuities Period shall be applied
separately to the different Trust Assets, provided that (i) Trust Assets
for which no sufficient record exists to determine the date of transfer
shall be deemed for this purpose to have been transferred on the earliest
possible date, and (ii) an insurance policy or the proceeds of an
insurance policy shall be deemed transferred on the date the policy is
acquired by the Collateral Trust regardless of the dates on which premiums
are subsequently paid. If the Collateral Trust suspends the power of
alienation or permits accumulations within the meaning of any Applicable
Rule limiting the period for such suspension or accumulations then this
provision shall apply to such suspension or accumulations as if they were
non-vested interests. Upon the termination of the Collateral Trust
pursuant to the application of any Perpetuities Period, the Collateral
Trustee shall pay the remaining principal to Congoleum.
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D. Amendments. The Collateral Trustee, with the unanimous consent of
Congoleum and Claimants' Counsel, may modify and amend this Collateral
Trust Agreement. Any modification made pursuant to this Section IV.D must
be made in writing. The ability of the Collateral Trustee, Congoleum and
Claimants' Counsel to amend this Collateral Trust Agreement in accordance
with this Section IV.D shall not be restricted by any third party not a
party hereto, including without limitation any Asbestos Claimant.
Notwithstanding the foregoing or any other provision of this Collateral
Trust Agreement, no modification or amendment to this Collateral Trust
Agreement shall be effective to alter the rights or duties of the Delaware
Trustee unless consented to in writing by the Delaware Trustee.
4. Other than expressly provided for herein, the terms of the Collateral
Trust Agreement shall remain in full force and effect.
5. The Collateral Trust Agreement and this Amendment to the Collateral Trust
Agreement (collectively, the "Agreements") constitute a single integrated
written contract expressing the entire agreement among the parties hereto
with respect to the subject matter hereof. The Agreements supercede any
prior understandings and agreements between or among the parties with
respect to the subject matter of the Agreements. Any statements, promises
or inducements, whether made by any party or any agents of any party, that
are not contained in the Agreements shall not be valid or binding. The
failure or invalidation of any provision of the Agreements shall not in
any way affect the validity or performance of any party pursuant to any
other provision of the Agreements.
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6. References in the Claimant Agreement, the Superceding Security Agreement
and the Collateral Trust Agreement to the "Collateral Trust Agreement"
shall be deemed references to the Agreements.
7. This Amendment to the Collateral Trust Agreement may be executed in any
number of counterparts. Each of such counterparts for all purposes shall
be deemed to be an original, and all such counterparts together shall
constitute but one and the same Amendment to the Collateral Trust
Agreement.
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IN WITNESS WHEREOF, the Parties have caused this Amendment to the
Collateral Trust Agreement to be duly executed this 6th day of June 2003.
CONGOLEUM CORPORATION
By /s/ Xxxxxx X. Xxxxx III
---------------------------------
Title CFO
------------------------------
COLLATERAL TRUSTEE
By
---------------------------------
Xxxxxx X. Xxxxxxxxx
DELAWARE TRUSTEE
By
---------------------------------
Title
------------------------------
Wilmington Trust Company
CONSENT:
By their signatures below, Claimants' Counsel, as designated in the
Settlement Agreement Between Congoleum Corporation And Various Asbestos
Claimants, indicate their consent to the execution of this Amendment to the
Collateral Trust Agreement.
--------------------------------
Xxxxx Xxxxx, Esq.
--------------------------------
Xxxxxx X. Xxxx, Esq.
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IN WITNESS WHEREOF, the Parties have caused this Amendment to the
Collateral Trust Agreement to be duly executed this ___ day of June 2003.
CONGOLEUM CORPORATION
By
---------------------------------
Title
------------------------------
COLLATERAL TRUSTEE
By /s/ Xxxxxx X. Xxxxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxxxx
DELAWARE TRUSTEE
By
---------------------------------
Title
------------------------------
Wilmington Trust Company
CONSENT:
By their signatures below, Claimants' Counsel, as designated in the
Settlement Agreement Between Congoleum Corporation And Various Asbestos
Claimants, indicate their consent to the execution of this Amendment to the
Collateral Trust Agreement.
--------------------------------
Xxxxx Xxxxx, Esq.
--------------------------------
Xxxxxx X. Xxxx, Esq.
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IN WITNESS WHEREOF, the Parties have caused this Amendment to the
Collateral Trust Agreement to be duly executed this ___ day of June 2003.
CONGOLEUM CORPORATION
By
---------------------------------
Title
------------------------------
COLLATERAL TRUSTEE
By
---------------------------------
Xxxxxx X. Xxxxxxxxx
DELAWARE TRUSTEE
By /s/ Xxxxxxxx Xxxxxxx
---------------------------------
Title Assistant Vice President
------------------------------
Wilmington Trust Company
CONSENT:
By their signatures below, Claimants' Counsel, as designated in the
Settlement Agreement Between Congoleum Corporation And Various Asbestos
Claimants, indicate their consent to the execution of this Amendment to the
Collateral Trust Agreement.
--------------------------------
Xxxxx Xxxxx, Esq.
--------------------------------
Xxxxxx X. Xxxx, Esq.
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IN WITNESS WHEREOF, the Parties have caused this Amendment to the
Collateral Trust Agreement to be duly executed this ___ day of June 2003.
CONGOLEUM CORPORATION
By
---------------------------------
Title
------------------------------
COLLATERAL TRUSTEE
By
---------------------------------
Xxxxxx X. Xxxxxxxxx
DELAWARE TRUSTEE
By
---------------------------------
Title
------------------------------
Wilmington Trust Company
CONSENT:
By their signatures below, Claimants' Counsel, as designated in the
Settlement Agreement Between Congoleum Corporation And Various Asbestos
Claimants, indicate their consent to the execution of this Amendment to the
Collateral Trust Agreement.
/s/ Xxxxx Xxxxx
--------------------------------
Xxxxx Xxxxx, Esq.
/s/ Xxxxxx X. Xxxx
--------------------------------
Xxxxxx X. Xxxx, Esq.
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