Congoleum Corp. commences solicitation of reorganization plan approval
Asbestos personal injury claimants, Congoleum's secured lender and its majority shareholder will receive ballots to vote on the plan, and Congoleum anticipates that it will receive the votes necessary to obtain the plan's approval. The deadline for submitting votes is Dec. 19, 2003.
Congoleum expects to commence bankruptcy proceedings in late December and seek bankruptcy court confirmation of the plan as promptly as possible. Under the terms of the plan, when confirmed, Congoleum will contribute certain insurance rights and a note for approximately $2.7 million (subject to a future revaluation) to a trust to be formed pursuant to the plan for the benefit of asbestos personal injury claimants, and all current and future asbestos claims against Congoleum will be channeled to the trust.
Under the terms of the plan, Congoleum's other creditors will be paid in full and its shareholders will maintain their equity holdings in Congoleum. To comply with statutory disclosure requirements, Congoleum's trade creditors, bondholders and minority shareholders will also receive documents describing the plan of reorganization, but will not be entitled to vote on the plan as it does not impair their interests, Congoleum says.