Exhibit 10.7

AMENDMENT NO. 1 TO LOAN AND SECURITY AGREEMENT

as of July 15, 2009

WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent
1133 Avenue of the Americas
New York, New York 10036

Ladies and Gentlemen:

Wachovia Bank, National Association, in its capacity as agent pursuant to the
Loan Agreement (as hereinafter defined) acting for and on behalf of the parties
thereto as lenders (in such capacity, “Agent”) and the parties to the Loan
Agreement as lenders (individually, each a “Lender” and, collectively,
“Lenders”) and American Biltrite Inc., a Delaware corporation (“ABI”), Ideal
Tape Co., Inc., a Delaware corporation (“Ideal Tape”), K&M Associates L.P., a
Rhode Island limited partnership (“K&M”; together with ABI and Ideal Tape, the
“US Borrowers”), American Biltrite (Canada) Ltd., a Canadian corporation
(“Canadian Borrower”; together with US Borrowers, the “Borrowers”), 425 Dexter
Associates, L.P., a Rhode Island limited partnership (“Dexter”), Ocean State
Jewelry, Inc., a Rhode Island corporation (“Ocean State”), Majestic Jewelry,
Inc., a Delaware corporation (“Majestic”), American Biltrite Far East, Inc., a
Delaware corporation (“Far East”; together with Dexter, Ocean State and
Majestic, the “US Guarantors”) have entered into certain financing arrangements
pursuant to which Agent and Lenders may make loans and advances and provide
other financial accommodations to Borrowers as set forth in the Loan and
Security Agreement, dated as of June 30, 2009, by and among Agent, Lenders,
Borrowers and Guarantors (as amended, the “Loan Agreement”) and the agreements,
documents and instruments at any time executed and/or delivered in connection
therewith or related thereto (all of the foregoing together with this Amendment
No. 1 to Loan and Security Agreement (“Amendment”), as the same now exist or may
hereafter be amended, modified, supplemented, extended, renewed, restated or
replaced, being collectively referred to herein as the “Financing Agreements”).
 
Borrowers have requested that Agent and Lenders agree to amend the Loan
Agreement as set forth herein, and Agent and Lenders have agreed to accommodate
Borrowers’ request.  The parties hereto wish to enter into this Amendment to
evidence and effectuate such amendments and certain other agreements relating
thereto, in each case subject to the terms and conditions and to the extent set
forth herein.
 
All capitalized terms used herein shall have the meanings assigned thereto in
the Loan Agreement and the other Financing Agreements, unless otherwise defined
herein.
 

 
 

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In consideration of the premises and covenants set forth herein and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
 
1.           Amendments to Loan Agreement.
 
(a)           Letters of Credit.  Effective as of June 30, 2009, the definition
of “Letters of Credit” set forth in Section 1.112 of the Loan Agreement is
hereby amended and restated in its entirety as follows:
 
“1.112  “Letters of Credit” shall mean all letters of credit denominated in US
Dollars or Canadian Dollars (whether documentary or stand-by and whether for the
purchase of inventory, equipment or otherwise) and banker’s acceptances issued
with respect to drafts presented under letters of credit (whether for the
purchase of inventory, equipment or otherwise), in each case issued by an
Issuing Bank for the account of any Borrower pursuant to this Agreement, and all
amendments, renewals, extensions or replacements thereof and including, but not
limited to, the Existing Letters of Credit.  The term “banker’s acceptance” as
used herein shall refer to a time draft that is an order issued by the
beneficiary of a letter of credit as the drawer of the time draft instructing
the issuer of the letter of credit as the drawee to pay the amount specified in
the time draft that has been accepted by a bank.”
 
(b)           Wachovia.  Effective as of June 30, 2009, the definition of
“Wachovia” set forth in Section 1.176 of the Loan Agreement is hereby amended
and restated in its entirety as follows:
 
“1.176  “Wachovia” shall mean Wachovia Bank, National Association, a national
banking association, in its individual capacity, and its successors and
assigns.”
 
(c)           Conditions Precedent.  The amendment set forth in this Amendment
shall not be effective until the receipt by Agent of an original (or faxed or
electronic copy) of this Amendment, duly authorized and executed by Borrowers
and confirmed by Guarantors.
 
2.           Effect of this Amendment.  Except as modified pursuant hereto, no
other changes or modifications to the Financing Agreements are intended or
implied and in all other respects the Financing Agreements are hereby
specifically ratified, restated and confirmed by all parties hereto as of the
effective date hereof.  To the extent of conflict between the terms of this
Amendment and the other Financing Agreements, the terms of this Amendment shall
control.  The Loan Agreement and this Amendment shall be read and construed as
one agreement.
 
3.           Further Assurances.  The parties hereto shall execute and deliver
such additional documents and take such additional action as may be necessary or
desirable to effectuate the provisions and purposes of this Amendment.
 

 
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4.           Governing Law.  The rights and obligations hereunder of each of the
parties hereto shall be governed by and interpreted and determined in accordance
with the internal laws of the State of New York (without giving effect to
principles of conflict of laws).
 
5.           Binding Effect.  This Amendment shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.
 
6.           Counterparts.  This Amendment may be executed in any number of
counterparts, but all of such counterparts shall together constitute but one and
the same agreement.  In making proof of this Amendment, it shall not be
necessary to produce or account for more than one counterpart thereof signed by
each of the parties hereto.
 

[SIGNATURE PAGES FOLLOW]

 
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U.S. BORROWERS
 
CANADIAN BORROWER
AMERICAN BILTRITE INC.
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
AMERICAN BILTRITE (CANADA) LTD.
 
By:         /s/ Richard G. Marcus__________
 
Title:       President____________________
 
   
IDEAL TAPE CO., INC.
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
     
K&M ASSOCIATES L.P.
 
By:  AIMPAR, Inc., its General Partner
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
           
[SIGNATURES CONTINUED ON NEXT PAGE]

[Signature Page Amendment No.1 ABI]
 
   

 
 

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[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
     
U.S. GUARANTORS
 
 
425 DEXTER ASSOCIATES, L.P.
 
By:  AIMPAR, Inc., its General Partner
 
By:        /s/ Richard G. Marcus___________
 
Title:      President_______________­_____
 
 
     
OCEAN STATE JEWELRY, INC.
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
     
AMERICAN BILTRITE FAR EAST, INC.
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
     
MAJESTIC JEWELRY, INC.
 
By:        /s/ Richard G. Marcus__________
 
Title:      President____________________
 
 
           
[SIGNATURES CONTINUED ON NEXT PAGE]

[Signature Page Amendment No.1 ABI]
 
   

 
 

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[SIGNATURES CONTINUED FROM PREVIOUS PAGE]
     
ACCEPTED AND AGREED:
     
AGENT:
 
 
WACHOVIA BANK, NATIONAL ASSOCIATION
 
By:       /s/ Marc. J. Breier_____________
 
Title:     Managing Director____________
 
     
ISSUING BANK:
 
 
WACHOVIA BANK, NATIONAL ASSOCIATION
 
By:       /s/ Marc. J. Breier_____________
 
Title:     Managing Director____________
 
     
LENDERS:
 
WACHOVIA BANK, NATIONAL ASSOCIATION
 
By:       /s/ Marc. J. Breier_____________
 
Title:     Managing Director____________
 
 
 
 
WACHOVIA CAPITAL FINANCE CORPORATION (CANADA)
 
By:       /s/ Laurence S. Forte____________
 
Title:     Managing Director______________
 
 
     

 
 
 
[Signature Page Amendment No.1 ABI]