Exhibit 10.1.1
FIRST AMENDMENT TO SETTLEMENT AGREEMENT BETWEEN CONGOLEUM CORPORATION
AND VARIOUS ASBESTOS CLAIMANTS
This first amendment to the Settlement Agreement Between Congoleum
Corporation And Various Asbestos Claimants ("Amendment to the Claimant
Agreement") is entered into by, between and among Congoleum Corporation, its
predecessors, successors, distributors and assigns (collectively, "Congoleum"),
and the Participating Asbestos Claimants, by and through representative
plaintiffs' counsel, Xxxxx Xxxxx, Esq. and Xxxxxx X. Xxxx, Esq. ("Claimants'
Counsel").
RECITALS
WHEREAS, Congoleum and Participating Asbestos Claimants entered into
an agreement titled Settlement Agreement Between Congoleum Corporation And
Various Asbestos Claimants (the "Claimant Agreement") dated April 10, 2003; and
WHEREAS, Congoleum and Participating Asbestos Claimants wish to
extend the time within which Asbestos Claimants may accept the terms of the
Claimant Agreement and agree to be bound by the Claimant Agreement and to extend
the time for such Asbestos Claimants to be eligible to provide Claim
Documentation and to qualify as a Participating Asbestos Claimant; and
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 (the
"Collateral Trust Agreement"); and
WHEREAS, Congoleum, the Collateral Trustee, and the Delaware
Trustee, with the consent of Claimants' Counsel, contemporaneously herewith are
executing that certain first amendment to the Collateral Trust Agreement (the
"Amendment to the Collateral Trust 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 have contemporaneously
herewith terminated the Security Agreements and entered into a subsequent
security agreement ("Superceding Security Agreement") to eliminate any confusion
as to the effective date of the grant of the Security Interest; and
WHEREAS, the Parties desire to enter into this Amendment to the
Claimant Agreement to confirm their agreement with respect to (i) the amendment
of certain deadlines related to qualification as Participating Claimants; (ii)
the termination of the Security Agreements; (iii) the execution of the
Superceding Security Agreement; and (iv) certain other matters relating to the
foregoing, as hereafter provided;
NOW, THEREFORE, intending to be legally bound hereby, Congoleum and
each of the Participating Asbestos Claimants agree that the Claimant Agreement
shall be amended as follows:
AGREEMENT
1. Section I.B.1 and I.B.2 of the Claimant Agreement shall be replaced in its
entirety with:
B. To qualify as a Participating Asbestos Claimant, each Asbestos
Claimant, or his counsel, must
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1. On or before July 1, 2003, submit in an electronic form
reasonably satisfactory to the Claims Reviewer the following documents and
information in form and substance satisfactory to the Claims Reviewer: (1)
the Asbestos Claimant's name and social security number; (2) the Asbestos
Claimant's alleged disease or injury; (3) for all cases filed after
February 14, 2003, a statement by counsel of record that the claimant can
comply with exposure requirements of the Agreement; (4) a statement that
his or her Asbestos Claim was filed in a court of competent jurisdiction
on or before July 1, 2003; and (5) a statement that the Asbestos Claimant
is interested in participating in this Claimant Agreement; and
2. On or before August 15, 2003, submit in writing the following
documents and information in form and substance satisfactory to the Claims
Reviewer: (1) evidence of bodily injury, sickness or disease consistent
with the terms and meaning of the Compensable Disease Matrix; however, if
such Asbestos Claimant was qualified as a Participating Category D
Claimant under the Settlement Agreement Between ACandS, Inc. and Various
Asbestos Claimants, dated April 17, 2002 (the "ACandS Claimant
Agreement"), a notice indicating that the claimant will rely upon the
evidence submitted to the Claims Reviewer in connection with the ACandS
Claimant Agreement will satisfy this requirement; (2) a statement swearing
under penalty of perjury or witnessed by a notary, that the Asbestos
Claimant was exposed to an asbestos-containing product manufactured, sold,
or distributed by Congoleum or for which Congoleum has legal liability;
(3) a claim form that will indicate the Asbestos Claimant's name, social
security number, exposure date and diagnosis date; (4) proof that the
Asbestos Claimant had filed a claim in a court of competent jurisdiction
against Congoleum on or before July 1, 2003; and (5) a release in the form
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of Appendix B hereto or another form acceptable to Congoleum (collectively
"Claim Documentation"). Asbestos Claimants should note that if they were
qualified under the ACandS Claimant Agreement as a Non-Malignant
Participating Category D Claimant, reliance on the submission in
connection with the ACandS Claimant Agreement will mean qualification here
as a Xxxxx 0 Xxx-Xxxxxxxxx disease category pursuant to the attached
Compensable Disease Matrix.
2. Section I.E of the Claimant Agreement shall be replaced in its entirety
with:
E. As to any Asbestos Claimant who submits Claim Documentation on or
before July 7, 2003, the Claims Reviewer will mail any notice of
deficiencies in Claim Documentation within thirty (30) days after receipt
of the Claims Documentation. As to any Asbestos Claimant who submits Claim
Documentation after July 7, 2003, the Claims Reviewer will mail any notice
of deficiencies in Claim Documentation within sixty (60) days after
receipt of the Claims Documentation. If the Claims Reviewer does not mail
notices of deficiencies within the time period set forth above to a
particular Asbestos Claimant, that Asbestos Claimant's Claim Documentation
shall be deemed satisfactory.
3. Sections II.A and II.B of the Claimant Agreement shall be replaced in
their entirety with:
II. SECURED RIGHTS OF PARTICIPATING ASBESTOS CLAIMANTS
A. The Security Interest contemplated by the Superceding Security
Agreement shall secure an amount equal to seventy-five percent (75%) of
the aggregate of all Participating Asbestos Claimants' Settlement Amounts
(the "Secured Amount") as provided in the Collateral Trust Agreement and
the Superceding Security Agreement. Congoleum's obligation to pay each
Participating Asbestos Claimant its pro rata share of the Secured Amount
shall be referred to herein as the "Secured Asbestos Claims."
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B. Until all of the Secured Asbestos Claims for all Participating Asbestos
Claimants are paid in full, Congoleum shall evaluate, bring, prosecute,
litigate, defend and settle any claim against its insurers to obtain
Insurance Proceeds. Congoleum shall consult with Claimants' Counsel in
order to retain a mutually acceptable counsel to prosecute any claim
against its insurers to obtain Insurance Proceeds. Congoleum agrees to
obtain the consent of Claimants' Counsel prior to entering into settlement
of any claim against its insurers to obtain Insurance Proceeds, which
consent shall not be unreasonably withheld, conditioned or delayed.
4. Section II.C of the Claimant Agreement shall be deleted.
5. The paragraph below shall be added to the Claimant Agreement as Section
III.D:
D. 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 a Participating Asbestos Claimant pursuant to a will or the
law applicable to the decendent's estate. The beneficial interests in the
Collateral Trust shall not be evidenced by a separate certificate. Nothing
in this paragraph III.D shall in any way restrict the ability of the
Collateral Trust to transfer the Trust Assets (as defined in the
Collateral Trust Agreement) 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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6. Other than expressly provided for herein, the terms of the Claimant
Agreement shall remain in full force and effect.
7. The Claimant Agreement and this Amendment to the Claimant 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.
8. References in the Claimant Agreement, the Superceding Security Agreement,
and the Collateral Trust Agreement to the "Claimant Agreement" shall be
deemed references to the Agreements.
9. This Amendment to the Claimant 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 Claimant Agreement.
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IN WITNESS WHEREOF, the parties have caused this First Amendment to the
Claimant Agreement to be duly executed this 6th day of June 2003.
CONGOLEUM CORPORATION
By /s/ Xxxxxx X. Xxxxx
---------------------------------
Title CFO
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PARTICIPATING ASBESTOS CLAIMANTS
By Claimants' Counsel
--------------------------------
Xxxxx Xxxxx, Esq.
--------------------------------
Xxxxxx X. Xxxx, Esq.
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IN WITNESS WHEREOF, the parties have caused this First Amendment to the
Claimant Agreement to be duly executed this ___ day of June 2003.
CONGOLEUM CORPORATION
By
---------------------------------
Title
------------------------------
PARTICIPATING ASBESTOS CLAIMANTS
By Claimants' Counsel
/s/ Xxxxx Xxxxx
--------------------------------
Xxxxx Xxxxx, Esq.
/s/ Xxxxxx X. Xxxx
--------------------------------
Xxxxxx X. Xxxx, Esq.
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