Exhibit 10.11.5
[Execution]
AMENDMENT NO. 2 TO RATIFICATION AND AMENDMENT AGREEMENT AND
AMENDMENT NO. 4 TO LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 2 TO RATIFICATION AND AMENDMENT AGREEMENT AND AMENDMENT NO.
4 TO LOAN AND SECURITY AGREEMENT, dated as of January 13, 2005 (this "Second
Ratification Amendment"), by and among CONGOLEUM CORPORATION, a Delaware
corporation, as debtor and debtor-in-possession ("Borrower"), CONGOLEUM FISCAL,
INC., a New York corporation, as debtor and debtor-in-possession ("CFI"),
CONGOLEUM SALES, INC., a New York corporation, as debtor and
debtor-in-possession ("CSI" and together with CFI, collectively, "Guarantors"
and each individually, a "Guarantor"), and WACHOVIA BANK, NATIONAL ASSOCIATION,
successor by merger to Congress Financial Corporation ("Lender").
W I T N E S S E T H:
WHEREAS, Lender, Borrower and Guarantors have entered into financing
arrangements pursuant to which Lender may make loans and advances and provide
other financial accommodations to Borrower as set forth in the Loan and Security
Agreement, dated December 10, 2001, between Lender and Borrower, as amended by
Amendment No. 1 to Loan and Security Agreement, dated September 29, 2002,
between Lender and Borrower, Amendment No. 2 to Loan and Security Agreement,
dated as of February 27, 2003, among Lender, Borrower and Guarantors, and as
further amended and ratified by the Ratification and Amendment Agreement, dated
as of January 7, 2004 (the "Ratification Agreement"), and Amendment No. 1 to
Ratification and Amendment Agreement and Amendment No. 3 to Loan and Security
Agreement, dated as of December 14, 2004, between Lender and Borrower, as
acknowledged by Guarantors, permitting debtor and debtor-in-possession financing
for Borrower and Guarantors, as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced (all of the
foregoing, as amended hereby and as the same may hereafter be further amended,
modified, supplemented, extended, renewed, restated or replaced, collectively,
the "Loan Agreement", and together with all agreements, documents and
instruments at any time executed and/or delivered in connection therewith or
related thereto, including the Reaffirmation and Amendment of Guarantor
Documents, dated as of January 7, 2004, between Lender and Guarantors, as from
time to time amended, modified, supplemented, extended, renewed, restated or
replaced, collectively, the "Financing Agreements");
WHEREAS, Borrower and each Guarantor has commenced a case under Chapter 11
of Title 11 of the United States Code in the United States Bankruptcy Court for
the District of New Jersey and has retained possession of its assets and is
authorized under the Bankruptcy Code to continue the operation of its businesses
as a debtor-in-possession;
WHEREAS, Borrower and Guarantors have requested that Lender make certain
amendments to the Loan Agreement, and Lender is willing to agree to such
request, subject to the terms and conditions contained herein;
WHEREAS, by this Second Ratification Amendment, Lender, Borrower and
Guarantors desire and intend to evidence such amendments;
WHEREAS, entry into this Second Ratification Amendment has been authorized
pursuant to Paragraph 12 of the Final Order (1) Authorizing Debtors' Use of Cash
Collateral, (2) Authorizing Debtors to Obtain Post-Petition Financing, (3)
Granting Senior Liens and Priority Administrative Expense Status Pursuant to 11
U.S.C. ss.ss.105 and 364(c), (4) Modifying the Automatic Stay Pursuant to 11
U.S.C. ss.362, and (5) Authorizing Debtors to Enter Into Agreements with
Congress Financial Corporation (the "Final DIP Financing Order"), which was
approved by the Bankruptcy Court on February 2, 2004, without further order of
the Bankruptcy Court because the amendments and modifications provided herein do
not constitute a "material change" as defined in the Final DIP Financing Order;
WHEREAS, this Second Ratification Amendment has been filed with the
Bankruptcy Court and notice thereof has been served upon all parties that have
requested notice in the Borrowers and Guarantors bankruptcy cases; and
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Lender, Borrower and
Guarantors hereby covenant, warrant and agree as follows:
1. DEFINITIONS.
1.1 Additional Definition. "Second Ratification Amendment" shall
mean this Second Ratification Amendment, as the same now exists or may hereafter
be amended, modified, supplemented, extended, renewed, restated or replaced.
1.2 Amendments to Definitions in Financing Agreements.
(a) All references to the term "Financing Agreements" in this
Second Ratification Amendment and in any of the Financing Agreements shall be
deemed and each such reference is hereby amended to include, in addition and not
in limitation, this Second Ratification Amendment, as the same now exists or may
hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced.
(b) All references to the term "Ratification Agreement" in
this Second Ratification Amendment and in any of the Financing Agreements shall
be deemed and each such reference is hereby amended to mean the Ratification
Agreement, as amended hereby, as the same now exists or may hereafter be
amended, modified, supplemented, extended, renewed, restated or replaced.
1.3 Interpretation. For purposes of this Second Ratification
Amendment, unless otherwise defined herein, all capitalized terms used herein,
including, but not limited to, those terms used and/or defined in the recitals
above, shall have the respective meanings assigned to such terms in the Loan
Agreement.
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2. AMENDMENTS TO LOAN AGREEMENT
2.1 Letter of Credit Accommodations. Section 2.2(e) of the Loan
Agreement is hereby deleted in its entirety and replaced with the following:
"(e) Except in Lender's discretion, the amount of all
outstanding Letter of Credit Accommodations and all other
commitments and obligations made or incurred by Lender in connection
therewith shall not at any time exceed $7,000,000."
3. ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS. In addition
to the continuing representations, warranties and covenants heretofore made in
the Loan Agreement or otherwise and hereafter made by Borrower and Guarantors to
Lender, whether pursuant to the Financing Agreements or otherwise, and not in
limitation thereof, Borrower and Guarantors hereby represent, warrant and
covenant with, to and in favor of Lender the following (which shall survive the
execution and delivery of this Agreement), the truth and accuracy of which, or
compliance with, to the extent such compliance does not violate the terms and
provisions of the Bankruptcy Code, being a continuing condition of the making of
loans by Lender:
3.1 This Second Ratification Amendment has been duly authorized,
executed and delivered by Borrower and Guarantors and the agreements and
obligations of Borrower and Guarantors contained herein constitute legal, valid
and binding obligations of Borrower and Guarantors enforceable against Borrower
and Guarantors in accordance with their respective terms.
3.2 No Event of Default or act, condition or event which with notice
or passage of time or both would constitute an Event of Default exists or has
occurred as of the date of this Second Ratification Amendment.
4. CONDITIONS PRECEDENT. In addition to any other conditions
contained herein or in the Loan Agreement, as in effect immediately prior to the
date hereof, with respect to the Loans, Letter of Credit Accommodations and
other financial accommodations available to Borrower (all of which conditions,
except as modified or made pursuant to this Second Ratification Amendment shall
remain applicable to the Loans and be applicable to Letter of Credit
Accommodations and other financial accommodations available to Borrower), the
following are conditions to Lender's obligation to extend further loans,
advances or other financial accommodations to Borrower pursuant to the Loan
Agreement:
4.1 No trustee, examiner or receiver or the like shall have been
appointed or designated with respect to Borrower or any Guarantor, as debtor and
debtor-in-possession, or its business, properties and assets;
4.2 Borrower and Guarantors shall execute and/or deliver to Lender
this Second Ratification Amendment, and all other Financing Agreements that
Lender may request to be delivered in connection herewith, in form and substance
satisfactory to Lender;
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4.3 Borrower and Guarantors shall execute and/or deliver to Lender
all other Financing Agreements, and other agreements, documents and instruments,
in form and substance satisfactory to Lender, which, in the good faith judgment
of Lender are necessary or appropriate and implement the terms of this Second
Ratification Amendment and the other Financing Agreements, as modified pursuant
to this Second Ratification Amendment, all of which contains provisions,
representations, warranties, covenants and Events of Default, as are reasonably
satisfactory to Lender and its counsel;
4.4 Each of Borrower and Guarantors shall comply in full with the
notice and other requirements of the Bankruptcy Code, the applicable Federal
Rules of Bankruptcy Procedure, and the terms and conditions of the Final DIP
Financing Order in a manner acceptable to Lender and its counsel;
4.5 No party entitled to received a copy of this Second Ratification
Amendment pursuant to the terms of the Final DIP Financing Order has filed an
objection or other pleading in opposition to Borrower and Guarantors entry into,
compliance with, and performance in accordance with the terms and conditions of
this Second Ratification Amendment.
4.6 No Event of Default shall be continuing under any of the
Financing Agreements, as of the date hereof.
5. MISCELLANEOUS.
5.1 Amendments and Waivers. Neither this Second Ratification
Amendment nor any other instrument or document referred to herein or therein may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought.
5.2 Further Assurances. Each of Borrower and Guarantors shall, at
its expense, at any time or times duly execute and deliver, or shall cause to be
duly executed and delivered, such further agreements, instruments and documents,
and do or cause to be done such further acts as may be necessary or proper in
Lender's opinion to evidence, perfect, maintain and enforce the security
interests of Lender, and the priority thereof, in the Collateral and to
otherwise effectuate the provisions or purposes of this Second Ratification
Amendment, any of the other Financing Agreements or the Financing Order.
5.3 Headings. The headings used herein are for convenience only and
do not constitute matters to be considered in interpreting this Second
Ratification Amendment.
5.4 Counterparts. This Second Ratification Amendment may be executed
in any number of counterparts, each of which shall be deemed to be an original,
but all of which shall together constitute one and the same agreement.
5.5 Additional Events of Default. The parties hereto acknowledge,
confirm and agree that the failure of Borrower or any Guarantor to comply with
any of the covenants, conditions and agreements contained herein or in any other
agreement, document or instrument at any time executed by Borrower or any
Guarantor in connection herewith shall constitute an Event of Default under the
Financing Agreements.
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5.6 Effectiveness. This Second Ratification Amendment shall become
effective upon the execution hereof by Lender.
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IN WITNESS WHEREOF, the parties hereto have caused this Second
Ratification Amendment to be duly executed as of the day and year first above
written.
WACHOVIA BANK, NATIONAL ASSOCIATION,
successor by merger to Congress Financial Corporation
By:
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Title:
----------------------------
CONGOLEUM CORPORATION,
as Debtor and Debtor-in-Possession
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: CFO
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CONGOLEUM SALES, INC.,
as Debtor and Debtor-in-Possession
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: VP
----------------------------
CONGOLEUM FISCAL, INC.,
as Debtor and Debtor-in-Possession
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: VP
----------------------------
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IN WITNESS WHEREOF, the parties hereto have caused this Second
Ratification Amendment to be duly executed as of the day and year first above
written.
WACHOVIA BANK, NATIONAL ASSOCIATION,
successor by merger to Congress Financial Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------
Title: Vice President
----------------------------
CONGOLEUM CORPORATION,
as Debtor and Debtor-in-Possession
By:
-------------------------------
Title:
----------------------------
CONGOLEUM SALES, INC.,
as Debtor and Debtor-in-Possession
By:
-------------------------------
Title:
----------------------------
CONGOLEUM FISCAL, INC.,
as Debtor and Debtor-in-Possession
By:
-------------------------------
Title:
----------------------------
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