SOURCE: Congoleum Corporation

Congoleum Corporation

July 08, 2010 13:05 ET

Congoleum Corporation Exits Bankruptcy

MERCERVILLE, NJ--(Marketwire - July 8, 2010) -  Congoleum Corporation reported today that its confirmed plan of reorganization became effective on July 1, 2010. 

Roger S. Marcus, Chairman of the Board, commented, "We are extremely pleased to have substantially consummated our confirmed plan of reorganization, pursuant to which the company reduced its debt level and channeled its asbestos liability to a court-approved asbestos trust. As part of the implementation of the plan, we have closed on a new credit facility that increases our revolving credit line from $30 million to $40 million. Our new additional liquidity should be more than adequate to finance growth opportunities that lie ahead."

Mr. Marcus continued, "This would not have been possible without the dedication and support of our employees through this challenging period, and I thank them for all their support. I am also grateful to our customers and suppliers who stood with us throughout the process."

The above news release 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 release, 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 press release speak only as of the date of such statement. 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 costs relating to the execution and implementation of the plan of reorganization, (ii) the reversal by the United States Court of Appeals for the Third Circuit of the order confirming the plan of reorganization if the appeal of such order by certain asbestos claimants is not dismissed (iii) increases in raw material and energy prices or disruption in supply, (iv) increased competitive activity from companies in the flooring industry, some of which have greater resources and broader distribution channels than Congoleum, (v) increases in the costs of environmental compliance and remediation or the exhaustion of insurance coverage for such expenses, (vi) 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, (vii) shipment delays, depletion of inventory and increased production costs resulting from unforeseen disruptions of operations at any of Congoleum's facilities or distributors, (viii) product warranty costs and (ix) changes in distributors of Congoleum's products. Upon the effective date of the confirmed plan of reorganization, holders of existing common shares of Congoleum received nothing on account of their interests and their shares were cancelled, and new shares were issued to the asbestos trust and holders of old senior notes in accordance with the plan. 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, 2009 and subsequent filings made by Congoleum with the Securities and Exchange Commission.