AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Amendment") is made as of
this 28th day of June, 2000, among CONGOLEUM CORPORATION ("Congoleum Corp."),
CONGOLEUM INTELLECTUAL PROPERTIES, INC. ("Intellectual"), CONGOLEUM FINANCIAL
CORPORATION ("Financial"; Congoleum Corp., Intellectual and Financial shall be
referred to collectively as "Borrowers" and each shall sometimes individually be
referred to as a "Borrower") and FIRST UNION NATIONAL BANK ("Lender"). All terms
capitalized but not defined herein shall have the meanings given to such terms
in the Agreement (as such term is hereinafter defined).
BACKGROUND
A. Congoleum Corp. and Lender entered into a certain Loan and Security
Agreement, dated as of December 18, 1998, pursuant to which Lender made
available the revolving credit facility described therein (as amended from time
to time, the "Agreement"). Intellectual and Financial became Borrowers under and
in accordance with the Agreement pursuant to a certain Joinder Agreement, dated
as of December 21, 1998.
B. Borrowers have requested that Lender amend the Fixed Charge Coverage
Ratio. Subject to the terms and conditions set forth herein, Lender is willing
to amend the Agreement as set forth herein.
NOW, THEREFORE, the parties agree as follows, intending to be legally
bound.
1. Section 6.6 of the Agreement is hereby amended to read as follows:
"SECTION 6.6 Fixed Charge Coverage Ratio. Borrowers shall maintain a Fixed
Charge Coverage Ratio of not less than the following as of the end of the
fiscal quarters ending on the following dates or during the following
periods:
Quarters Ending Ratio
--------------- -----
6/30/2000 through 12/31/2000 1.75:1.00
3/31/2001 2.25:1.00
6/30/2001 and thereafter 2.50:1.00
2. Each Borrower represents and warrants that as of the date hereof:
(A) The representations and warranties set forth in the Agreement and made
a part hereof are true and correct in all material respects (excluding
representations and warranties which speak of a particular date, which shall
continue to be true and correct in all material respects as of such date).
(B) No Default or Event of Default has occurred and is continuing.
(C) (i) The Loan Documents to which such Borrower is a party continue to
be enforceable against such Borrower in accordance with their terms, except as
such enforceability may be limited by bankruptcy, insolvency, or other similar
laws affecting the enforcement of creditors' rights generally, by limitations on
the availability of equitable remedies and by equitable principles and (ii) such
Borrower has no charge, lien, claim or offset against the Lender.
3. The obligations of the Lender hereunder and the effectiveness of this
Amendment are subject to the satisfaction of each of the following conditions
precedent:
(A) Documents. Borrowers shall have delivered or caused to be delivered
the following documents:
(1) this Amendment duly executed by each intended party hereto;
and
(2) such other documents as the Lender may reasonably require.
(B) Payment of Fees and Costs. Borrowers shall pay all costs and
out-of-pocket expenses (including, without limitation, reasonable attorneys'
fees and costs) of Lender in connection with the Agreement (including without
limitation this Amendment), and the transactions contemplated thereby, which
includes, among other things, the preparation, review and negotiation of this
Amendment.
4. Borrowers hereby reaffirm their obligations to Lender under the Agreement.
5. The parties agree that except as expressly amended hereby, the Agreement
shall remain in full force and effect; and that the collateral granted therein
or in connection therewith shall continue to secure the Liabilities as therein
stated.
6. Except as specifically set forth herein, the execution, delivery and
effectiveness of this Amendment shall not operate as a waiver of any right,
power or remedy of Lender under the Agreement, nor constitute a waiver of any
Default or Event of Default or any provision of the Agreement.
7. This Amendment shall be construed and enforced in accordance with the laws of
the State of New Jersey.
8. This Amendment may be signed in one or more counterparts which, when taken
together, shall constitute one and the same document.
9. This Amendment contains all of the modifications to the Agreement. No further
modifications shall be deemed effective, unless in a writing executed by the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have caused this Amendment to be executed by their respective officers thereunto
duly authorized, as of the date first above written.
CONGOLEUM CORPORATION CONGOLEUM INTELLECTUAL
PROPERTIES, INC.
By: By:
------------------------- -------------------------
Xxxxxx X. Xxxxx, III Name: Xxxxxx X. Xxxxx, III
Chief Financial Officer Title: Secretary
CONGOLEUM FINANCIAL CORPORATION FIRST UNION NATIONAL BANK
By: By:
------------------------- -------------------------
Name: Xxxxxx X. Xxxxx, III Name:
Title: Secretary Title:
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