8-K

                       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


                                January 29, 2004
                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 January 29, 2004, American Biltrite Inc. (the "Company") and its
majority-owned subsidiary K&M Associates L.P. ("K&M") entered into an amendment
(the "Fleet Amendment") to its existing credit agreement (as so amended, the
"Amended Credit Agreement") with Fleet National Bank ("Fleet"). Prior to the
consummation of the Fleet Amendment, Citizens Bank of Massachusetts assigned
its interests in and to its rights and obligations under the credit agreement
to Fleet, resulting in Fleet becoming the sole lender under the credit
agreement. The Fleet Amendment, among other things, amended certain financial
covenants that the Company and K&M were subject to under the existing credit
agreement. The amount of borrowings that may be outstanding at any time under
the Amended Credit Agreement may not exceed $20 million, and this borrowing cap
may be subject to reduction from time to time if the borrowing base under the
Amended Credit Agreement is less than $20 million. The Amended Credit Agreement
expires on December 31, 2004.

Also on January 29, 2004, the Company, K&M and The Prudential Insurance Company
of America ("Prudential") entered into an amendment (the "Prudential
Amendment") to the Note Purchase and Private Shelf Agreement and Facility
Guarantee, dated as of August 28, 2001 (as previously amended, the "Note
Purchase Agreement"). The Prudential Amendment, among other things, revised
certain financial and other covenants under the Note Purchase Agreement,
consistent with the amendments to the financial covenants under the Amended
Credit Agreement made by the Fleet Amendment. Pursuant to the Prudential
Amendment, the Company must enter into a definitive commitment by November 14,
2004 relating to the replacement or refinancing of not less than $15 million of
the facilities under the Amended Credit Agreement to be effective by December
31, 2004, on terms substantially similar to the Amended Credit Agreement and
with a maturity of not less than one year.

The Prudential Amendment and the Fleet Amendment are filed hereto as Exhibits
4.1 and 10.1, respectively.


Item 7.  Financial Statements and Exhibits.

(c) Exhibits.

          Exhibit
           Number        Exhibits
          --------       --------

              4.1        Amendment No. 5 to Note Purchase and Private Shelf
                         Agreement and Facility Guarantee, dated as of January
                         29, 2004, among American Biltrite Inc., K&M Associates
                         L.P. and The Prudential Insurance Company of America

             10.1        Amendment No. 1 to Credit Agreement, dated as of
                         January 29, 2004, among American Biltrite Inc., K&M
                         Associates L.P. and Fleet National Bank


                                   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:  February 2, 2004                          By /s/ Howard N. Feist III
                                                   ------------------------
                                                   Howard N. Feist III
                                                   Chief Financial Officer




                                 EXHIBIT INDEX

          Exhibit
           Number        Exhibits
          -------        --------

              4.1        Amendment No. 5 to Note Purchase and Private Shelf
                         Agreement and Facility Guarantee, dated as of January
                         29, 2004, among American Biltrite Inc., K&M Associates
                         L.P. and The Prudential Insurance Company of America

             10.1        Amendment No. 1 to Credit Agreement, dated as of
                         January 29, 2004, among American Biltrite Inc., K&M
                         Associates L.P. and Fleet National Bank

EX-4

                                                                   EXHIBIT 4.1


                            AMERICAN BILTRITE INC.

                                Amendment No. 5


         This Amendment No. 5, dated as of January 29, 2004 (this
"Amendment"), is among American Biltrite Inc., a Delaware corporation (the
"Company"); K&M Associates L.P., a Rhode Island limited partnership (the
"Guarantor" and, together with all Subsidiaries party to a Guarantor Joinder
Agreement, the "Guarantors"); and The Prudential Insurance Company of America
("Prudential"). The parties hereto agree as follows:

         1. Note Agreement; Definitions. This Amendment amends the Note
Purchase and Private Shelf Agreement and Facility Guarantee dated as of August
28, 2001 among the parties hereto (as amended by Amendment No. 1, dated
December 31, 2002; Amendment No. 2, dated March 31, 2003; Amendment No. 3,
dated June 30, 2003; and Amendment No. 4, dated October 14, 2003; together
with any other amendment, modification or replacement thereof, the "Note
Agreement"). Terms defined in the Note Agreement as amended hereby (the
"Amended Note Agreement") and not defined herein are used herein as so
defined.

         2. Amendments to Note Agreement. Effective upon the date upon which
all the conditions set forth in paragraph 4 hereof are satisfied (the
"Amendment Date"), which conditions must be satisfied no later than the date
provided therein, the Note Agreement is amended as follows:

               2.1. Amendment to paragraph 6A. The introductory paragraph of
paragraph 6A of the Note Agreement is amended and restated to read in its
entirety as follows:

                  "6A. Financial Ratios. The Company covenants that, from and
         as of October 14, 2003 until December 31, 2004, it will not permit
         the items specified in Annex I hereto, and thereafter, as follows, in
         each case determined at the end of each fiscal quarter:"

               2.2. Amendment to paragraph 6B. Paragraph 6B of the Note
Agreement is amended by replacing the words "ending on or after March 1, 2004"
with the words "ending on or after December 31, 2004".

               2.3. Amendment to paragraph 7A(xvii). Paragraph 7A(xvii) of the
Note Agreement is amended and restated to read in its entirety as follows:

                  "(xvii) the Company shall (A) fail to enter into, on or
         before November 14, 2004, a definitive commitment relating to the
         replacement or refinancing of not less than $15,000,000 of the
         facilities under the Bank Agreement to be effective by December 31,
         2004 or such other date prior to the termination of the current Bank
         Agreement, on terms substantially similar to the Bank Agreement and
         with a maturity of not less than one year, (B) fail to consummate on
         or before December 31, 2004, such replacement or refinancing of not
         less than $15,000,000 of the facilities under the Bank Agreement or
         (C) fail to cause the lenders party to such replacement or
         refinancing to enter into an intercreditor agreement with the holders
         of the Notes on terms substantially similar to the Intercreditor
         Agreement;"

               2.4. Amendments to Annex I. Annex I to the Note Agreement is
amended as follows:

                      2.4.1. Amendment to Opening Paragraph of Annex I. The
opening paragraph of Annex I is amended by replacing the reference to "March
1, 2004" contained therein with "December 31, 2004".

                      2.4.2. Amendment to Paragraph (i) of Annex I. Paragraph
(i) of Annex I is amended and restated to read in its entirety as follows:

                  "(i) Consolidated Total Liabilities to Consolidated Tangible
         Net Worth. On the last day of each fiscal quarter of the Company,
         Consolidated Total Liabilities shall not exceed not exceed the
         percentage set forth in the table below of Consolidated Tangible Net
         Worth on such date:

                 Quarter Ending                           Percentage
                 --------------                           ----------
               9/30/03 to 6/30/04                            225%
             9/30/04 and thereafter                          200%"

                      2.4.3. Amendment to Paragraph (ii) of Annex I. Paragraph
(ii) of Annex I is amended and restated to read in its entirety as follows:

                  "(ii) Consolidated Adjusted EBITDA to Consolidated Interest
         Expense. For each period of four consecutive fiscal quarters of the
         Company, Consolidated Adjusted EBITDA shall equal or exceed the
         percentage set forth in the table below of Consolidated Interest
         Expense.

                  Quarter Ending                          Percentage
                  --------------                          ----------
                     9/30/03                                  60%
                     12/31/03                                 80%
                     3/31/04                                  70%
               6/30/04 and 9/30/04                           100%
             12/31/04 and thereafter                         150%"

                      2.4.4 Amendment to Paragraph (v) of Annex I. Paragraph
(v) of Annex I is amended and restated to read in its entirety as follows:

                  "(v) Income or Loss from Continuing Operations. Net loss
         from continuing operations (excluding, in all events, net income
         relating to Janus Flooring Corporation) of the Company and its
         Subsidiaries reporting Congoleum on the equity method shall not
         exceed $500,000 in the fiscal quarter of the Company ending December
         31, 2003. Net income from continuing operations (excluding, in all
         events, net income relating to Janus Flooring Corporation) of the
         Company and its Subsidiaries reporting Congoleum on the equity method
         shall equal or exceed $1.00 in at least one of any two consecutive
         fiscal quarters of the Company for any two consecutive fiscal
         quarters of the Company ending March 31, 2004 and thereafter."

                      2.4.5. Amendment to the Definition of "Consolidated
Adjusted EBITDA" Contained in Annex I. The definition of "Consolidated
Adjusted EBITDA" contained in Annex I is amended by replacing the reference to
"June 30, 2004" contained therein with "December 31, 2004".

         3. Representations and Warranties. Each of the Company and the
Guarantor jointly and severally represents and warrants as follows:

               3.1. Legal Existence, Organization, Authorization. Each of the
Company, the Guarantor, ABTRE, Inc. ("ABTRE"), Aimpar, Inc. ("Aimpar"),
American Biltrite Intellectual Properties, Inc. ("ABIP"), Ocean State Jewelry,
Inc. ("OSJ"), American Biltrite Far East, Inc. ("ABFE"), Ideal Tape Co., Inc.
("Ideal"), 425 Dexter Associates, L.P. ("Dexter") and Majestic Jewelry, Inc.
("Majestic", and together with the Company, the Guarantor, ABTRE, Aimpar,
ABIP, OSJ, ABFE, Ideal and Dexter, the "Credit Parties") is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its organization, with all power and authority, corporate, limited liability
company, partnership or otherwise, necessary (as is applicable to each) (a) to
enter into and perform this Amendment and the Amended Note Agreement and (b)
to own its properties and carry on the business now conducted or proposed to
be conducted by it. Each of the Credit Parties has taken all corporate,
limited liability company, partnership or other action (as is applicable to
each) required to make the provisions of this Amendment and the Amended Note
Agreement the valid and enforceable obligations they purport to be.

               3.2. Enforceability. Each Credit Party has duly authorized,
executed and delivered this Amendment. This Amendment will, upon execution, be
the legal, valid and binding obligation of each Credit Party, enforceable
against each Credit Party in accordance with its terms, except to the extent
that such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors rights generally and by general equitable principles (regardless of
whether enforcement is considered in a proceeding in equity or at law).

               3.3. No Legal Obstacle to Agreements. Neither the execution,
delivery or performance of this Amendment, nor the performance of the Amended
Note Agreement, nor the consummation of any other transaction referred to or
contemplated by this Amendment, nor the fulfillment of the terms hereof, has
constituted or resulted in or will constitute or result in:

               (a) any breach or termination of any Material Agreement;

               (b) the violation of any law, judgment, decree or governmental
         order, rule or regulation applicable to the Company or any of its
         Restricted Subsidiaries;

               (c) the creation under any agreement, instrument, deed or lease
         of any Lien upon any of the assets of the Company or any of its
         Restricted Subsidiaries (other than the Liens created pursuant to the
         Security Agreement); or

               (d) any redemption, retirement or other repurchase obligation
         of the Company or any of its Restricted Subsidiaries under any
         charter, by-law, agreement, instrument, deed or lease.

No approval, authorization or other action by, or declaration to or filing
with, any governmental or administrative authority or any other Person is
required to be obtained that has not been obtained or made that has not been
made by the Company or any of its Restricted Subsidiaries in connection with
the execution, delivery and performance of this Amendment or the performance
of the Amended Note Agreement, or the consummation of the transactions
contemplated hereby or thereby, except for any filings which may be required
pursuant to the federal securities laws and regulations.

               3.4. Defaults. Immediately before and after giving effect to
the amendments set forth in paragraph 2 hereof, no Default will exist.

               3.5. Incorporation of Representations and Warranties. The
representations and warranties set forth in paragraph 8 of the Amended Note
Agreement are true and correct on the date hereof as if originally made on and
as of the date hereof, except (a) to the extent that any such representations
or warranties speak as of an earlier date, in which case they shall be true
and correct as of such earlier date, (b) for any exhibits or schedules to the
Note Agreement, which exhibits and schedules shall be true and correct as of
the date of the Note Agreement, (c) the Security Agreement creates a Lien in
favor of the Collateral Agent on behalf of the Lenders and the Noteholders (in
each case, as defined therein) and (d) except as disclosed by the Company in
any filing with the Securities and Exchange Commission.

         4. Conditions. The effectiveness of this Amendment shall be subject
to the satisfaction of the following conditions, which conditions must be
satisfied no later than January 29, 2004 or this Amendment shall terminate:

               4.1. Officer's Certificate. Except, in each case as may have
occurred with respect to the dissolution or performance of Janus Flooring
Corporation, the representations and warranties of the Company and the
Guarantor set forth or incorporated by reference herein shall be true and
correct as of the Amendment Date as if originally made on and as of the
Amendment Date, except (a) to the extent that any such representations or
warranties speak as of an earlier date, in which case they shall be true and
correct as of such earlier date, (b) for any exhibits or schedules to the Note
Agreement, which exhibits and schedules shall be true and correct as of the
date of the Note Agreement and (c) except as disclosed by the Company in any
filing with the Securities and Exchange Commission; no Default shall have
occurred on or prior to the Amendment Date; and Prudential shall have received
a certificate to these effects signed by a Responsible Officer in the event
the Amendment Date occurs after the date hereof.

               4.2. Proper Proceedings. This Amendment and the transactions
contemplated hereby shall have been authorized by all necessary proceedings of
the Company and the Guarantor, and each of the Company and the Guarantor shall
provide a certificate to such effect. All necessary consents, approvals and
authorizations of any governmental or administrative agency or any other
Person with respect to any of the transactions contemplated hereby shall have
been obtained and shall be in full force and effect. Prudential shall have
received copies of all documents, including certificates, records of
corporate, limited liability company, partnership or other proceedings and
opinions of counsel, which Prudential may have reasonably requested in
connection therewith, such documents where appropriate to be certified by
proper corporate, limited liability company, partnership or governmental
authorities.

               4.3. Executed Agreements. Prudential shall have received a
counterpart of each of (i) this Amendment, executed by the Company and the
Guarantor and (ii) an executed copy of the amendment to the Bank Agreement, in
each case in form and substance satisfactory to Prudential.

               4.4. Costs and Expenses. The Company shall have paid (i) all
costs and expenses (including attorney's fees and expenses) incurred by
Prudential through the date hereof, pursuant to statements submitted to the
Company (which statements may include estimates of time and expenses to be
incurred on and after the dates of posting of actual time and expenses set
forth therein, which estimated amounts shall be subject to subsequent
adjustment to reflect actual time and expenses subsequently posted) and (ii)
an amendment fee in the amount of $20,000.

               Notwithstanding anything to the contrary contained herein, the
Company hereby acknowledges and agrees that failure of the Company to comply
with the covenants set forth above in this Section 5 by the date indicated
shall constitute an Event of Default under the Amended Note Agreement.

         5. General. The Amended Note Agreement, the Security Agreement and
the Notes are each confirmed as being in full force and effect. This
Amendment, the Amended Note Agreement, the Notes, the Security Agreement, the
Consent Letter, dated as of August 1, 2003, by Prudential in favor of the
Company and the documents referred to therein constitute the entire
understanding of the parties with respect to the subject matter hereof and
thereof and supersede all prior and current understandings and agreements,
whether written or oral. This Amendment may be executed in any number of
counterparts (including by way of facsimile transmission), which together
shall constitute one instrument, and shall bind and inure to the benefit of
the parties and their respective successors and assigns. This Amendment shall
be governed by and construed in accordance with the laws of the State of New
York without regard to conflicts of law principles.



                           [Signature Page Follows]





         Each of the undersigned has caused this Amendment to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.


                                         AMERICAN BILTRITE INC.


                                         By  /s/ Howard N. Feist III
                                             ---------------------------------
                                             Name:  Howard N. Feist III
                                             Title: Vice President, Finance


                                         K&M ASSOCIATES L.P.

                                         By: AIMPAR, INC., its General Partner


                                         By  /s/ Howard N. Feist III
                                             ---------------------------------
                                             Name:  Howard N. Feist III
                                             Title: Vice President and
                                                    Assistant Secretary


                                         THE PRUDENTIAL INSURANCE COMPANY
                                         OF AMERICA


                                         By  /s/ Kevin J. Kraska
                                             --------------------------------
                                             Name:  Kevin J. Kraska
                                             Title: Vice President

EX-10

                                                                  EXHIBIT 10.1


                            AMERICAN BILTRITE INC.
                              K&M ASSOCIATES L.P.

                               CREDIT AGREEMENT

                                Amendment No. 1


         This Agreement, dated as of January 29, 2004 (this "Agreement"), is
among American Biltrite Inc., a Delaware corporation ("American Biltrite"),
K&M Associates L.P., a Rhode Island limited partnership ("K&M"; American
Biltrite and K&M being collectively but jointly and severally, the
"Borrower"), the Lenders under the Credit Agreement (as defined below) and
Fleet National Bank, as Agent for itself and such Lenders. The parties agree
as follows:

         1. Credit Agreement; Definitions. This Agreement amends the Credit
Agreement dated as of October 14, 2003 among the parties hereto (as in effect
prior to giving effect to this Agreement, the "Credit Agreement"). Terms
defined in the Credit Agreement as amended hereby (the "Amended Credit
Agreement") and not otherwise defined herein are used with the meaning so
defined.

         2. Amendment of Credit Agreement. Effective upon the date all the
conditions set forth in Section 4 hereof are satisfied or waived (the
"Amendment Date"), which conditions must be satisfied or waived no later than
the date provided therein, the Credit Agreement is amended as follows:

         2.1. Amendment of Recitals. The recitals to the Credit Agreement are
     amended in their entirety as follows:

               "Recitals: Pursuant to this Agreement, the Lenders are
               extending to the Borrower a $20,000,000 secured revolving
               credit facility, including a $5,000,000 sub-allotment for
               Letters of Credit. All the credit facilities mature on December
               31, 2004. The proceeds of these credit facilities may be used
               for general corporate purposes as provided herein."

         2.2. Amendments of Section 1. Section 1 of the Credit Agreement is
     amended as follows:

            (a) The definition of "Applicable Margin" is amended to read in
         its entirety as follows:

               "'Applicable Margin' means the amount in the table below set
               opposite the Reference Leverage Ratio for such date:

                      "Reference Leverage Ratio            Applicable Margin
                       ------------------------            -----------------
                              [> or =] 325%                    275 b.p.
                           [> or =] 300% < 325%                250 b.p.
                           [> or =] 250% < 300%                200 b.p.
                           [> or =] 201% < 250%                150 b.p.
                           [> or =] 101% < 200%                125 b.p.
                              [< or =] 100%                    100 b.p.

               Changes in the Applicable Margin shall occur on the third
               Banking Day after quarterly financial statements have been
               furnished to the Agent in accordance with Sections 6.4.1 or
               6.4.2 from time to time. In the event that the financial
               statements required to be delivered pursuant to Section 6.4.1
               or 6.4.2, as applicable, are not delivered when due, then
               during the period from the third Banking Day following the date
               such financial statements were due until the third Banking Day
               following the date on which they are actually delivered, the
               Applicable Margin shall be the maximum amount set forth in the
               table above."

            (b) The definition of "Final Maturity Date" is amended to read in
         its entirety as follows:

               "'Final Maturity Date' means December 31, 2004."

         2.3. Amendment of Section 2.1.2. Section 2.1.2 of the Credit
     Agreement is amended to read in its entirety as follows:

               "2.1.2. Maximum Amount of Revolving Credit. The term "Maximum
               Amount of Revolving Credit" means $20,000,000 minus Net Asset
               Sale Proceeds required to be prepaid pursuant to Section 4.5
               hereof."

         2.4. Amendment of Section 6.5.1. Section 6.5.1 of the Credit
     Agreement is amended to read in its entirety as follows:

               "6.5.1. Consolidated Total Liabilities to Consolidated Tangible
               Net Worth. On the last day of each fiscal quarter of the
               Company, Consolidated Total Liabilities shall not exceed the
               percentage set forth in the table below of Consolidated
               Tangible Net Worth on such date.

                         Quarter Ending                    Percentage
                         --------------                    ----------
                       9/30/03 to 6/30/04                     225%
                     9/30/04 and thereafter                   200%"

         2.5. Amendment of Section 6.5.2. Section 6.5.2 of the Credit
     Agreement is amended to read in its entirety as follows:

               "6.5.2. Consolidated Adjusted EBITDA to Consolidated Interest
               Expense. For each period of four consecutive fiscal quarters of
               the Company, Consolidated Adjusted EBITDA shall equal or exceed
               the percentage set forth in the table below of Consolidated
               Interest Expense.

                          Quarter Ending                   Percentage
                          --------------                   ----------
                             9/30/03                           60%
                             12/31/03                          80%
                             3/31/04                           70%
                       6/30/04 and 9/30/04                    100%
                     12/31/04 and thereafter                  150%"

         2.6. Amendment of Section 6.5.5. Section 6.5.5 of the Credit
     Agreement is amended to read in its entirety as follows:

               "6.5.5. Income or Loss from Continuing Operations. Net loss
               from continuing operations (excluding, in all events, net
               income relating to Janus Flooring Corporation) of the Company
               and its Subsidiaries reporting Congoleum on the equity method
               shall not exceed $500,000 in the fiscal quarter of the Company
               ending December 31, 2003. Net income from continuing operations
               (excluding, in all events, net income relating to Janus
               Flooring Corporation) of the Company and its Subsidiaries
               reporting Congoleum on the equity method shall equal or exceed
               $1.00 in at least one of any two consecutive fiscal quarters of
               the Company for any two consecutive fiscal quarters of the
               Company ending March 31, 2004 and thereafter."

         2.7. Amendment of Exhibit 10.1. Exhibit 10.1 to the Credit Agreement
     is amended to read in its entirety as set forth in Exhibit 10.1 hereto.

         3. Representations and Warranties. Each of the Borrowers jointly and
severally represents and warrants as follows, it being understood that the
transactions contemplated by the Congoleum Plan, the Congoleum Note or the
Congoleum Plan Trust, and the dissolution and performance of Janus Flooring
Corporation, and in each case, the effects thereof, shall be excluded for each
and all of the purposes hereof:

         3.1. Legal Existence, Organization. Each of the Borrowers is duly
     organized and validly existing and in good standing under the laws of the
     jurisdiction of its organization, with all power and authority,
     corporate, partnership or otherwise, necessary (a) to enter into and
     perform this Agreement and the Amended Credit Agreement and (b) to own
     its properties and carry on the business now conducted or proposed to be
     conducted by it. Each of the Borrowers has taken all corporate,
     partnership or other action required to make the provisions of this
     Agreement and the Amended Credit Agreement the valid and enforceable
     obligations they purport to be.

         3.2. Enforceability. Each of the Borrowers has duly authorized,
     executed and delivered this Agreement. Each of this Agreement and the
     Amended Credit Agreement is the legal, valid and binding obligation of
     each of the Borrowers and is enforceable against the Borrowers in
     accordance with its terms.

         3.3. No Legal Obstacle to Agreements. Neither the execution, delivery
     or performance of this Agreement, nor the performance of the Amended
     Credit Agreement, nor the consummation of any other transaction referred
     to or contemplated by this Agreement, nor the fulfillment of the terms
     hereof or thereof, has constituted or resulted in or will constitute or
     result in:

         (a) any breach or termination of any material agreement, instrument,
     deed or lease to which the Company or any of its Subsidiaries is a party
     or by which it is bound, or of the Charter or By-laws of the Company or
     any of its Subsidiaries;

         (b) the material violation of any law, judgment, decree or
     governmental order, rule or regulation applicable to the Company or any
     of its Subsidiaries;

         (c) the creation under any agreement, instrument, deed or lease of
     any Lien (other than the Liens created pursuant to the Security
     Agreement) upon any of the assets of the Company or any of its
     Subsidiaries; or

         (d) any redemption, retirement or other repurchase obligation of the
     Company or any of its Subsidiaries under any Charter, By-law, agreement,
     instrument, deed or lease.

     No approval, authorization or other action by, or declaration to or
     filing with, any governmental or administrative authority or any other
     Person is required to be obtained that has not been obtained or made that
     has not been made by the Company or any of its Subsidiaries in connection
     with the execution, delivery and performance of this Agreement or the
     performance of the Amended Credit Agreement, or the consummation of the
     transactions contemplated hereby or thereby.

         3.4. Defaults. Immediately after giving effect to the amendments set
     forth in Section 2 hereof, no Default will exist.

         3.5. Incorporation of Representations and Warranties. The
     representations and warranties set forth in Section 7 of the Amended
     Credit Agreement are true and correct in all material respects on the
     date hereof as if originally made on and as of the date hereof, except
     for those representations and warranties that relate to an earlier date
     which shall be true and correct in all material respects as of that date.

         4. Conditions. The effectiveness of this Agreement shall be subject
to the satisfaction or waiver of the following conditions, which conditions
must be satisfied or waived on or before the date hereof:

         4.1. Notes. The Borrowers shall have duly authorized, executed and
     delivered to the Agent a Revolving Note payable to Fleet National Bank as
     Lender in substantially the form of Exhibit 2.1.4 of the Credit
     Agreement. The Lenders shall have returned for cancellation the Revolving
     Notes dated October 14, 2003.

         4.2. Amendment to Note Purchase Agreement. The Company, K&M and
     Prudential shall have entered into an amendment to the Note Purchase
     Agreement, which amendment shall be effective simultaneously with the
     effectiveness of this Agreement and which shall be in form and substance
     reasonably satisfactory to the Agent.

         4.3. Assignment and Assumption Agreement. Citizens Bank of
     Massachusetts ("Citizens") and Fleet shall have entered into an
     Assignment and Assumption Agreement in substantially the form of Exhibit
     11.1.1 of the Credit Agreement, which Assignment and Assumption Agreement
     shall be in effect immediately prior to this Agreement taking effect.

         4.4. Field Audit. The Agent shall have received a field audit
     conducted by a third party chosen at the Agent's reasonable discretion.
     The Agent shall have had an opportunity to review such field audit and
     the substance of such field audit shall be reasonably satisfactory to the
     Agent.

         4.5. Officer's Certificate. Except, in each case, as may have
     occurred with respect to the dissolution or performance of Janus Flooring
     Corporation, the representations and warranties of the Company and its
     Subsidiaries set forth or incorporated by reference herein shall be true
     and correct in all material respects as of the Amendment Date as if
     originally made on and as of the Amendment Date, except for those that
     relate to an earlier date which shall be true and correct in all material
     respects as of that date; no Default shall have occurred on or prior to
     the Amendment Date; and the Agent shall have received a certificate to
     these effects signed by a Financial Officer.

         4.6. Secretary's Certificate. The Agent shall have received a
     certificate of the Secretary or Assistant Secretary of each of American
     Biltrite and the general partner of K&M, dated the Amendment Date, in
     form and substance reasonably satisfactory to the Agent as to (a) the
     Charter and By-laws of the Borrower, (b) the actions, corporate or
     otherwise, (including copies of relevant votes) taken by its board of
     directors to authorize the transactions contemplated hereby, and (c) the
     name, title and signatures of the officers of the Borrower executing this
     Agreement and the other agreements, instruments and other documents
     executed by or on behalf of the Borrower pursuant to this Agreement or
     otherwise in connection with the transactions contemplated hereby.

         4.7. Payment of Agent's Fees and Expenses. The Company shall have
     paid to Fleet National Bank an amendment fee of $62,500 and shall have
     authorized Fleet National Bank to charge the loan account for the
     reasonable expenses of Ropes & Gray LLP in connection with the
     negotiation and consummation of this Agreement, each as contemplated by a
     separate agreement among the Agent and the Company.

         4.8. Proper Proceedings. This Agreement, each other Credit Document
     and the transactions contemplated hereby and thereby shall have been
     authorized by all necessary proceedings of each Obligor and any of their
     respective Affiliates party thereto. All necessary consents, approvals
     and authorizations of any governmental or administrative agency or any
     other Person with respect to any of the transactions contemplated hereby
     or by any other Credit Document shall have been obtained and shall be in
     full force and effect. The Agent shall have received copies of all
     documents, including certificates, records of corporate, limited
     liability company, partnership or other proceedings and opinions of
     counsel, which the Agent may have reasonably requested in connection
     therewith, such documents where appropriate to be certified by proper
     corporate, limited liability company, partnership or governmental
     authorities.

         5. Reallocation. On the Amendment Date the Agent will reallocate the
Loan and Letter of Credit Exposure held by the Lenders in accordance with
their Percentage Interests as set forth on Exhibit 10.1 hereto including the
payments of any amounts outstanding to Citizens.

         6. Certain Calculations. Amounts in respect of interest, commitment
fees, Letter of Credit fees and other amounts payable under the Amended Credit
Agreement shall be payable in accordance with the terms of the Credit
Agreement as in effect prior to giving effect to the amendments provided in
Section 2 hereof for periods prior to the Amendment Date and in accordance
with the Amended Credit Agreement for periods from and after the Amendment
Date.

         7. Further Assurances. Each of the Company and its Subsidiaries will,
promptly upon the reasonable request of the Agent from time to time, execute,
acknowledge, deliver, file and record all such instruments and notices, and
take all such other action, as the Agent deems necessary or advisable to carry
out the intent and purposes of this Agreement.

         8. General. The Amended Credit Agreement and all of the Credit
Documents are each confirmed as being in full force and effect. This
Agreement, the Amended Credit Agreement and the other Credit Documents
referred to herein or therein constitute the entire understanding of the
parties with respect to the subject matter hereof and thereof and supersede
all prior and current understandings and agreements, whether written or oral.
Each of this Agreement and the Amended Credit Agreement is a Credit Document
and may be executed in any number of counterparts (including by way of
facsimile transmission), which together shall constitute one instrument, and
shall bind and inure to the benefit of the parties and their respective
successors and assigns, including as such successors and assigns all holders
of any Credit Obligation. This Agreement shall be governed by and construed in
accordance with the laws (other than the conflict of law rules) of The
Commonwealth of Massachusetts.



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         Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.

                                            AMERICAN BILTRITE INC.


                                            By  /s/ Howard N. Feist III
                                               -------------------------------
                                               Name:  Howard N. Feist III
                                               Title: Vice President, Finance


                                            K&M ASSOCIATES L.P.


                                            By: AIMPAR, INC., its General
                                                Partner


                                            By  /s/ Howard N. Feist III
                                                ------------------------------
                                                Name:  Howard N. Feist III
                                                Title: Vice President and
                                                       Assistant Secretary


                                            FLEET NATIONAL BANK, as
                                            Agent and Lender under the
                                            Credit Agreement


                                            By  /s/ Thomas F. Brennan
                                                ------------------------------
                                                Name:  Thomas F. Brennan
                                                Title: Senior Vice President






             Signature Page to Amendment No. 1 to Credit Agreement