As reported last week on this website, the U.S. Bankruptcy Court for the District of New Jersey recently stayed an order to dismiss Congoleum's more than five-year-old bankruptcy case pending an appeal. The decision reversed an earlier decision by the same court to dismiss the case after deciding that certain aspects of the proposed reorganization plan did not comply with bankruptcy code. Roger Marcus, CEO of Congoleum, said he sees the recent developments as "positive steps."
He noted that the dismissal and subsequent stay for appeal is designed to force a resolution of "a few complex issues" in a higher court. "The Bankruptcy Court encouraged an appeal so that a higher court can rule on these matters and provide guidance on how to address them," Marcus said. "We look forward to receiving that direction so we can move forward with a confirmable plan."
“Our attorneys are already preparing the necessary appeal papers, and I am hopeful we are on a path that could lead to confirmation of a plan before the end of 2009 or early 2010," he noted. "In the meantime, we remain focused on maintaining a sound operational and financial footing, despite the current economic conditions.”
Marcus added that Congoleum's working capital lender "remains supportive of us through these proceedings and market conditions. They have agreed, subject to court approval, to a modification of our financing arrangement to adjust covenants in light of the environment and our current performance. This agreement was filed with the court on March 7, 2009.”
Congoleum's Marcus calls developments in bankruptcy case 'positive'
March 11, 2009