SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
October 14, 2003
Date of Report (Date of earliest event reported)
AMERICAN BILTRITE INC.
(Exact name of registrant as specified in its charter)
Commission File Number: 1-4773
Delaware 04-1701350
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
57 River Street
Wellesley Hills, Massachusetts 02481-2097
(Address of principal executive office)
Registrant's telephone number, including area code: (781) 237-6655
Not Applicable
(Former name or former address, if changed since last report)
Item 5. Other Events.
On October 14, 2003, American Biltrite Inc. (the "Company") and its
majority-owned subsidiary K&M Associates L.P. ("K&M") entered into a new
credit agreement (the "New Credit Agreement") with Fleet National Bank and
Citizens Bank of Massachusetts (collectively, the "Lenders"). The New Credit
Agreement replaces the preexisting credit agreement the Company and K&M had
with the Lenders (the "Prior Credit Agreement"). In connection with the New
Credit Agreement, the Company and certain of its domestic subsidiaries granted
the Lenders a security interest in most of the Company's and its domestic
subsidiaries' assets. The security interest granted to the Lenders does not
include the shares of capital stock of the Company's majority-owned subsidiary
Congoleum Corporation or the assets of Congoleum Corporation. Under the New
Credit Agreement, the Company and K&M are subject to various financial and
other covenants. The amount of borrowings that may be outstanding at any time
under the New Credit Agreement may not exceed $25 million, and this borrowing
cap may be subject to reduction from time to time if the borrowing base under
the Note Purchase Agreement is less than $25 million. Interest is payable on
amounts borrowed under the New Credit Agreement at rates which generally vary
between a LIBOR based rate plus 1.0% to a LIBOR based rate plus 2.5% depending
on the Company's leverage ratio, as determined under the New Credit Agreement.
Certain domestic subsidiaries of the Company have agreed to guaranty the
Company's obligations under the New Credit Agreement. The New Credit Agreement
expires on March 1, 2004.
On October 14, 2003, the Company and The Prudential Insurance Company of
America ("Prudential") entered into an amendment to the Note Purchase and
Private Shelf Agreement and Facility Guarantee, dated as of August 28, 2001,
among the Company and Prudential (as previously amended, the "Note Purchase
Agreement"). The amendment revised certain financial covenants under the Note
Purchase Agreement to afford the Company with greater flexibility to comply
with those covenants and requires the Company to comply with additional
covenants consistent with those included in secured facilities. In connection
with the amendment, the Company and certain of its domestic subsidiaries
granted Prudential a security interest in most of the Company's and its
domestic subsidiaries' assets. The security interest granted to Prudential
does not include the shares of capital stock of the Company's majority-owned
subsidiary Congoleum Corporation or the assets of Congoleum Corporation.
Certain domestic subsidiaries of the Company have agreed to guaranty the
Company's obligations under the amended Note Purchase Agreement.
The security interests granted to Prudential pursuant to the amendment and to
the Lenders pursuant to the New Credit Agreement are on parity with each other,
and with regard to the collateral subject to the granted security interests,
Fleet National Bank is acting as collateral agent for itself, Citizens Bank of
Massachusetts and any other Lenders that may from time to time be parties to
the New Credit Agreement, and Prudential and any other persons or entities that
may from time to time hold notes issued by the Company pursuant to the Note
Purchase Agreement. The Lenders and Prudential are parties to an
intercreditor agreement which governs certain matters regarding their rights
with respect to the collateral that is subject to the security interests
granted to them by the Company and certain of its domestic subsidiaries.
Under the Note Purchase Agreement, the Company previously issued notes in an
aggregate principal amount of $20 million (the "Series A Notes"). The Series A
Notes generally bear interest at a rate of 7.91% per annum, and the Company is
obligated to pay Prudential an additional fee on each interest payment date if
the Company's and certain of its subsidiaries' ratio of debt to EBITDA, as
defined under the amended Note Purchase Agreement, exceeds certain levels. The
amount of those fees that may be payable by the Company varies depending on
the extent the Company's and certain of its subsidiaries' debt exceeds EBITDA
and is capped at 2% of the outstanding principal amount of the Series A Notes.
Principal on the Senior Notes is repayable in five annual installments of $4.0
million beginning on August 28, 2006. In addition, the amended Note Purchase
Agreement provides for possible issuances of additional notes by the Company
for up to an aggregate principal amount of $15 million, which additional notes
will mature not later than 10 years after the date of issuance and will bear
interest at rates to be determined on or about the time of issuance.
The New Credit Agreement, the Note Purchase Agreement, the amendments to the
Note Purchase Agreement and certain agreements relating to the New Credit
Agreement and the latest amendment to the Note Purchase Agreement are filed as
exhibits hereto.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit
Number Exhibits
------ --------
4.1 Note Purchase and Private Shelf Agreement and Facility
Guarantee, dated as of August 28, 2001, among American
Biltrite Inc., K&M Associates L.P. and The Prudential
Insurance Company of America
4.2 Amendment No. 1 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of December 31, 2002, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.3 Amendment No. 2 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of March 31, 2003, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.4 Amendment No. 3 to Note Purchase and Private Shelf
Agreement and Facility Guarantee, dated as of June 30, 2003,
among American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.5 Amendment No. 4 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.6 Security Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the subsidiaries of American Biltrite Inc. from time
to time party thereto
4.7 Intercreditor and Collateral Agency Agreement, dated as of
October 14, 2003, by and among Fleet National Bank, Citizens
Bank of Massachusetts, The Prudential Insurance Company of
America and the other banks from time to time party thereto
and the Acknowledgment of and Consent and Agreement to
Intercreditor and Collateral Agency Agreement by American
Biltrite Inc., K&M Associates L.P. and the other American
Biltrite Inc. guarantor subsidiaries
4.8 Guarantor Joinder Agreement, dated as of October 14, 2003,
made by ABTRE, Inc., AIMPAR, Inc., American Biltrite
Intellectual Properties, Inc., Ideal Tape Co., Inc., Majestic
Jewelry, Inc., Ocean State Jewelry, Inc. and 425 Dexter
Associates, L.P. in favor of The Prudential Insurance Company
of America
10.1 Credit Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the other lenders party thereto
10.2 Security Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the subsidiaries of American Biltrite Inc. from time
to time party thereto (1)
10.3 Intercreditor and Collateral Agency Agreement, dated as of
October 14, 2003, by and among Fleet National Bank, Citizens
Bank of Massachusetts, The Prudential Insurance Company of
America and the other banks from time to time party thereto
and the Acknowledgment of and Consent and Agreement to
Intercreditor and Collateral Agency Agreement by American
Biltrite Inc., K&M Associates L.P. and the other American
Biltrite Inc. guarantor subsidiaries (2)
10.4 Guarantee Agreement dated as of October 14, 2003, among
ABTRE, Inc., AIMPAR, Inc., American Biltrite Intellectual
Properties, Inc., Ideal Tape Co., Inc., Majestic Jewelry,
Inc., Ocean State Jewelry, Inc., 425 Dexter Associates, L.P.
and Fleet National Bank
___________________________
(1) Incorporated by reference to Exhibit 4.6 to this Current
Report on Form 8-K
(2) Incorporated by reference to Exhibit 4.7 to this Current
Report on Form 8-K
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMERICAN BILTRITE INC.
Date: October 16, 2003 By /s/ Howard N. Feist III
--------------------------------
Howard N. Feist III
Chief Financial Officer
EXHIBIT INDEX
Exhibit
Number Exhibits
------ --------
4.1 Note Purchase and Private Shelf Agreement and Facility
Guarantee, dated as of August 28, 2001, among American
Biltrite Inc., K&M Associates L.P. and The Prudential
Insurance Company of America
4.2 Amendment No. 1 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of December 31, 2002, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.3 Amendment No. 2 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of March 31, 2003, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.4 Amendment No. 3 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of June 30, 2003, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.5 Amendment No. 4 to Note Purchase and Private Shelf Agreement
and Facility Guarantee, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P. and The
Prudential Insurance Company of America
4.6 Security Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the subsidiaries of American Biltrite Inc. from time
to time party thereto
4.7 Intercreditor and Collateral Agency Agreement, dated as of
October 14, 2003, by and among Fleet National Bank, Citizens
Bank of Massachusetts, The Prudential Insurance Company of
America and the other banks from time to time party thereto
and the Acknowledgment of and Consent and Agreement to
Intercreditor and Collateral Agency Agreement by American
Biltrite Inc., K&M Associates L.P. and the other American
Biltrite Inc. guarantor subsidiaries
4.8 Guarantor Joinder Agreement, dated as of October 14, 2003,
made by ABTRE, Inc., AIMPAR, Inc., American Biltrite
Intellectual Properties, Inc., Ideal Tape Co., Inc., Majestic
Jewelry, Inc., Ocean State Jewelry, Inc. and 425 Dexter
Associates, L.P. in favor of The Prudential Insurance Company
of America
10.1 Credit Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the other lenders party thereto
10.2 Security Agreement, dated as of October 14, 2003, among
American Biltrite Inc., K&M Associates L.P., Fleet National
Bank and the subsidiaries of American Biltrite Inc. from time
to time party thereto (1)
10.3 Intercreditor and Collateral Agency Agreement, dated as of
October 14, 2003, by and among Fleet National Bank, Citizens
Bank of Massachusetts, The Prudential Insurance Company of
America and the other banks from time to time party thereto
and the Acknowledgment of and Consent and Agreement to
Intercreditor and Collateral Agency Agreement by American
Biltrite Inc., K&M Associates L.P. and the other American
Biltrite Inc. guarantor subsidiaries (2)
10.4 Guarantee Agreement dated as of October 14, 2003, among
ABTRE, Inc., AIMPAR, Inc., American Biltrite Intellectual
Properties, Inc., Ideal Tape Co., Inc., Majestic Jewelry,
Inc., Ocean State Jewelry, Inc., 425 Dexter Associates, L.P.
and Fleet National Bank
___________________________
(1) Incorporated by reference to Exhibit 4.6 to this Current
Report on Form 8-K
(2) Incorporated by reference to Exhibit 4.7 to this Current
Report on Form 8-K