Mercerville, NJ, May 12--Congoleum Corp. announced today that it has reached a settlement agreement with one of its excess insurance carriers over coverage for asbestos-related claims.
Under the terms of the settlement, certain AIG companies will pay $103 million over ten years to the trust to be formed upon confirmation of Congoleum's proposed amended plan of reorganization. The settlement resolves coverage obligations of policies with a total of $114 million in liability limits for asbestos bodily injury claims, and is subject to final court approval and effectiveness of Congoleum's proposed amended plan of reorganization.
Roger S. Marcus, Chairman of the Board, commented, "We are pleased to have resolved our dispute with this carrier, and we are hopeful that additional negotiations presently underway will lead to further settlements with other carriers in the near future. This agreement, together with a previously announced $15 million settlement and the expected contribution from Congoleum, will provide the resources to pursue insurance coverage from other carriers through litigation where necessary and will permit the trust to be formed upon Congoleum's reorganization to begin the payment of allowed claims immediately upon confirmation. We believe this represents another major step forward in our journey to put our asbestos exposure behind us."
On December 31, 2003, Congoleum Corporation filed a voluntary petition with the United States Bankruptcy Court for the District of New Jersey (Case No. 03-51524) seeking relief under Chapter 11 of the United States Bankruptcy Code as a means to resolve claims asserted against it related to the use of asbestos in its products decades ago.
