Unassociated Document


    Exhibit
10.3

     

    REGISTRATION
RIGHTS AGREEMENT

     

    REGISTRATION
RIGHTS AGREEMENT (“Agreement”) is entered
into as of the ____ day of August, 2005, by and among WestPoint International,
Inc. (f/k/a WS Textile Co., Inc.), a Delaware corporation (the “Company”), and
the undersigned parties listed under Investor on the signature page hereto
(each, an “Investor” and collectively, the “Investors”) that have executed and
delivered this Agreement.

     

    WITNESSETH:

     

    WHEREAS,
the Investors currently hold all of the issued and outstanding securities of the
Company; and

     

    WHEREAS,
the Investors and the Company desire to enter into this Agreement to provide the
Investors with certain rights relating to the registration of shares of Common
Stock (as defined below) held by them and/or issuable upon exercise of the
Subscription Rights (as defined below) held by them, and the registration of the
Subscription Rights held by them, as applicable.

     

    NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

     

    1.  DEFINITIONS.  The
following capitalized terms used herein have the following
meanings:

     

    “Affiliate” means,
with respect to any Person, any other Person that, directly or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such Person, and the term “control” (including the terms
“controlled by” and “under common control with”) means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through ownership of voting securities, by
contract or otherwise.

     

    “Agreement” means this
Agreement, as amended, restated, supplemented, or otherwise modified from time
to time.

     

    “Aretex” means Aretex
LLC.

     

    “Asset
Purchase Agreement” means
the Asset Purchase Agreement, dated June 23, 2005, among the
Company, New Textile One, Inc., New Textile Two, Inc., WestPoint Home, Inc.
(f/k/a Textile Co., Inc.),
WestPoint Stevens, Inc., WestPoint Stevens Inc. I, WestPoint
Stevens Stores Inc., and J.P. Stevens Enterprises Inc.

     

    “Commission” means the
Securities and Exchange Commission, or any other federal agency then
administering the Securities Act or the Exchange Act.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Common Stock” means
the Class A Common Stock, par value $0.01 per share, of the
Company.

     

    “Company” is defined
in the preamble to this Agreement.

     

    “Demand Registration”
is defined in Section 2.2.1.

     

    “Demanding Holder” is
defined in Section 2.2.1.

     

    “Distribution Date”
means the date that all of the Common Stock and Subscription Rights are
delivered in accordance with Section 3.3(c) of the Asset Purchase
Agreement.

     

    “Exchange Act” means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission promulgated thereunder, all as the same shall be in effect at
the time.

     

    “Governmental Body”
means any government or governmental or regulatory body thereof, or political
subdivision thereof, whether foreign, federal, state, or local, or any agency,
instrumentality or authority thereof, or any court or arbitrator (public or
private).

     

    “Initial Holder” is
defined in Section 2.1.1.

     

    “Initial Registration”
is defined in Section 2.1.1.

     

    “Indemnified Party” is
defined in Section 4.3.

     

    “Indemnifying Party”
is defined in Section 4.3.

     

    “Investor” is defined
in the preamble to this Agreement.

     

    “Investor Indemnified
Party” is defined in Section 4.1.

     

    “Maximum Number of
Shares” is defined in Section 2.2.4.

     

    “Non-Related Initial
Holder” means any Initial Holder that is not a Related Initial
Holder.

     

    “Notices” is defined
in Section 5.3.

     

    “Person” means any
individual, corporation, limited liability company, partnership, firm, joint
venture, association, joint-stock company, trust, unincorporated organization,
Governmental Body or other entity.

     

    “Piggy-Back
Registration” is defined in Section 2.3.1.

     

    “Register,” “registered” and
“registration”
mean a registration effected by preparing and filing a Registration Statement or
similar document in compliance with the requirements of the Securities Act, and
the applicable rules and regulations promulgated thereunder, and such
registration statement becoming effective.

     

    
      
        
        

      

      
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    “Registrable
Securities” means all of the shares of Common Stock owned or held by the
Investors, all of the Subscription Rights owned or held by the Investors and all
of the shares of Common Stock issuable upon the exercise of all of the
Subscription Rights owned or held by the Investors.  Registrable
Securities include any warrants, shares of capital stock or other securities of
the Company issued as a dividend or other distribution with respect to or in
exchange for or in replacement of such shares of Common Stock and/or
Subscription Rights, as applicable.  As to any particular Registrable
Securities, such securities shall cease to be Registrable Securities
when:  (a) a Registration Statement with respect to the sale of
such securities shall have become effective under the Securities Act and such
securities shall have been sold, transferred, disposed of or exchanged in
accordance with such Registration Statement; (b) such securities are no
longer owned or held by the Investor; (c) such securities shall have been
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent public distribution of them shall not require registration under the
Securities Act; (d) such securities shall have ceased to be outstanding, or
(e) all of the Registrable Securities owned or held by the Investor are
immediately salable under Rule 144.

     

    “Registration
Statement” means a registration statement filed by the Company with the
Commission in compliance with the Securities Act and the rules and regulations
promulgated thereunder for a public offering and sale of Common Stock (other
than a registration statement on Form S-4 or Form S-8, or its successor, or any
registration statement covering only securities proposed to be issued in
exchange for securities or assets of another entity).

     

    “Related Initial
Holder” means Textile Holding, LLC and any of its
Affiliates.

     

    “Securities Act” means
the Securities Act of 1933, as amended, and the rules and regulations of the
Commission promulgated thereunder, all as the same shall be in effect at the
time.

     

    “Subscription Rights”
shall have the meaning set forth in the Asset
Purchase Agreement.

     

    “Underwriter” means a
securities dealer who purchases any Registrable Securities as principal in an
underwritten offering and not as part of such dealer’s market-making
activities.

     

    2.  REGISTRATION
RIGHTS.

     

    2.1  Initial
Registration.

     

    2.1.1.  Registration.  As
soon as reasonably practicable after the Distribution Date, the Company shall
prepare a Registration Statement for registration under the Securities Act of
all or part of the Registrable Securities and all of the shares of Common Stock
issuable upon exercise of all of the Subscription Rights that may be owned or
held by persons other than the Investors (the “Initial
Registration”). The Company will notify all holders of Registrable
Securities of the Initial Registration, and each holder of Registrable
Securities who wishes to include all or a portion of such holder’s Registrable
Securities in the Initial Registration (each such holder including shares of
Registrable Securities in such registration, an “Initial Holder”)
shall so notify the Company within fifteen (15) days after the receipt by the
holder of the notice from the Company. Each Initial Holder shall specify the
number of Registrable Securities proposed to be sold and the intended method(s)
of distribution thereof. The Company shall not be obligated to effect more than
one (1) Initial Registration under this Section 2.1.1 in respect of
Registrable Securities.

     

    
      
        
        

      

      
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    2.1.2.  Effective
Registration.  A registration will not count as an Initial
Registration until the Registration Statement filed with the Commission with
respect to such Initial Registration has been declared effective and the Company
has complied with all of its obligations under this Agreement with respect
thereto; provided, however, that if,
after such Registration Statement has been declared effective, the offering of
Registrable Securities pursuant to an Initial Registration is interfered with by
any stop order or injunction of the Commission or any other governmental agency
or court, the Registration Statement with respect to such Initial Registration
will be deemed not to have been declared effective, unless and until, such stop
order or injunction is removed, rescinded or otherwise terminated.

     

    2.1.3.  Underwritten
Offering.  If a majority-in-interest of the Non-Related Initial
Holders so elect and such holders so advise the Company within fifteen (15) days
after the receipt by the holder of the notice from the Company, the offering of
such Registrable Securities pursuant to such Initial Registration shall be in
the form of an underwritten offering. In such event, the right of any holder to
include its Registrable Securities in such registration shall be conditioned
upon such holder’s participation in such underwriting and the inclusion of such
holder’s Registrable Securities in the underwriting to the extent provided
herein. All Initial Holders proposing to distribute their securities through
such underwriting shall enter into an underwriting agreement in customary form
with the Underwriter or Underwriters selected for such underwriting by a
majority-in-interest of the Non-Related Initial Holders initiating the Initial
Registration, which Underwriter or Underwriters shall be satisfactory to the
Company.

     

    2.2  Demand
Registration.

     

    2.2.1.  Request for
Registration.  At any time and from time to time on or after
the Company is eligible to utilize a registration statement on Form S-3 for
transactions involving secondary offerings under the Securities Act, the holders
of a majority-in-interest of the Registrable Securities held by the Investors,
may make a written demand for registration under the Securities Act of all or
part of their Registrable Securities (a “Demand
Registration”).  Any demand for a Demand Registration shall
specify the number of Registrable Securities proposed to be sold and the
intended method(s) of distribution thereof.  The Company will notify
all holders of Registrable Securities of the demand, and each holder of
Registrable Securities who wishes to include all or a portion of such holder’s
Registrable Securities in the Demand Registration (each such holder including
shares of Registrable Securities in such registration, a “Demanding Holder”)
shall so notify the Company within fifteen (15) days after the receipt by the
holder of the notice from the Company.  Upon any such request, the
Demanding Holders shall be entitled to have their Registrable Securities
included in the Demand Registration, subject to Section 2.2.4 and the
provisos set forth in Section 3.1.1.  The Company shall not be
obligated to effect more than one (1) Demand Registration under this
Section 2.2.1 in respect of Registrable Securities.

     

    
      
        
        

      

      
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    2.2.2.  Effective
Registration.  A registration will not count as a Demand
Registration until the Registration Statement filed with the Commission with
respect to such Demand Registration has been declared effective and the Company
has complied with all of its obligations under this Agreement with respect
thereto; provided, however, that if,
after such Registration Statement has been declared effective, the offering of
Registrable Securities pursuant to a Demand Registration is interfered with by
any stop order or injunction of the Commission or any other governmental agency
or court, the Registration Statement with respect to such Demand Registration
will be deemed not to have been declared effective, unless and until, (i) such
stop order or injunction is removed, rescinded or otherwise terminated, and (ii)
a majority-in-interest of the Demanding Holders thereafter elect to continue the
offering.

     

    2.2.3.  Underwritten
Offering.  If a majority-in-interest of the Demanding Holders
so elect and such holders so advise the Company as part of their written demand
for a Demand Registration, the offering of such Registrable Securities pursuant
to such Demand Registration shall be in the form of an underwritten offering. In
such event, the right of any holder to include its Registrable Securities in
such registration shall be conditioned upon such holder’s participation in such
underwriting and the inclusion of such holder’s Registrable Securities in the
underwriting to the extent provided herein.  All Demanding Holders
proposing to distribute their securities through such underwriting shall enter
into an underwriting agreement in customary form with the Underwriter or
Underwriters selected for such underwriting by a majority-in-interest of the
holders initiating the Demand Registration, which Underwriter or Underwriters
shall be satisfactory to the Company.

     

    2.2.4.  Reduction of
Offering.  If the managing Underwriter or Underwriters for a
Demand Registration that is to be an underwritten offering advises the Company
and the Demanding Holders in writing that the dollar amount or number of
Registrable Securities which the Demanding Holders desire to sell, taken
together with all other shares of Common Stock or other securities which the
Company desires to sell and the shares of Common Stock, if any, as to which
registration has been requested pursuant to written contractual piggy-back
registration rights held by other shareholders of the Company who desire to
sell, exceeds the maximum dollar amount or maximum number of shares that can be
sold in such offering without adversely affecting the proposed offering price,
the timing, the distribution method, or the probability of success of such
offering (such maximum dollar amount or maximum number of shares, as applicable,
the “Maximum Number of
Shares”), then the Company shall include in such
registration:  (i) first, the Registrable Securities as to which
Demand Registration has been requested by the Demanding Holders (pro rata in accordance
with the number of Registrable Securities which such Demanding Holder has
requested be included in such registration, regardless of the number of
Registrable Securities held by each Demanding Holder) that can be sold without
exceeding the Maximum Number of Shares; (ii) second, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clause (i),
the shares of Common Stock or other securities that the Company desires to sell
that can be sold without exceeding the Maximum Number of Shares; (iii) third, to
the extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (i) and (ii), the shares of Common Stock for the account of
other persons that the Company is obligated to register pursuant to written
contractual arrangements with such persons and that can be sold without
exceeding the Maximum Number of Shares; and (v) fourth, to the extent that the
Maximum Number of Shares have not been reached under the foregoing clauses (i),
(ii), and (iii), the shares of Common Stock that other shareholders desire to
sell that can be sold without exceeding the Maximum Number of
Shares.

     

    
      
        
        

      

      
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    2.3  Piggy-Back
Registration.

     

    2.3.1.  Piggy-Back
Rights.  If within two (2) years after the Distribution Date,
the Company proposes to file a Registration Statement under the Securities Act
with respect to an offering of equity securities, or securities or other
obligations exercisable or exchangeable for, or convertible into, equity
securities, by the Company for its own account or for shareholders of the
Company for their account (or by the Company and by shareholders of the Company
including, without limitation, pursuant to Section 2.1), other than a
Registration Statement (i) filed in connection with any employee stock option or
other benefit plan, (ii) for an exchange offer or offering of securities solely
to the Company’s existing shareholders, (iii) for an offering of debt that is
convertible into equity securities of the Company, (iv) for a dividend
reinvestment plan or (v) filed in connection with the Company’s initial public
offering (other than the Initial Registration) for equity to be issued by the
Company, then the Company shall (x) give written notice of such proposed filing
to the holders of Registrable Securities as soon as practicable but in no event
less than ten (10) days before the anticipated filing date, which notice shall
describe the amount and type of securities to be included in such offering, the
intended method(s) of distribution, and the name of the proposed managing
Underwriter or Underwriters, if any, of the offering, and (y) offer to the
holders of Registrable Securities in such notice the opportunity to register the
sale of such number of Registrable Securities as such holders may request in
writing within five (5) days following receipt of such notice (a “Piggy-Back
Registration”).  The Company shall cause such Registrable
Securities to be included in such registration and will request the managing
Underwriter or Underwriters of a proposed underwritten offering to permit the
Registrable Securities requested to be included in a Piggy-Back Registration to
be included on the same terms and conditions as any similar securities of the
Company and to permit the sale or other disposition of such Registrable
Securities in accordance with the intended method(s) of distribution
thereof.  All holders of Registrable Securities proposing to
distribute their securities through a Piggy-Back Registration that involves an
Underwriter or Underwriters shall enter into an underwriting agreement in
customary form with the Underwriter or Underwriters selected for such Piggy-Back
Registration.

     

    2.3.2.  Reduction of
Offering.  If the managing Underwriter or Underwriters for a
Piggy-Back Registration that is to be an underwritten offering advises the
Company and the holders of Registrable Securities in writing that the dollar
amount or number of shares of Common Stock which the Company desires to sell,
taken together with shares of Common Stock, if any, as to which registration has
been demanded pursuant to written contractual arrangements with persons other
than the holders of Registrable Securities hereunder, the Registrable Securities
as to which registration has been requested under this Section 2.3, and the
shares of Common Stock, if any, as to which registration has been requested
pursuant to the written contractual piggy-back registration rights of other
shareholders of the Company, exceeds the Maximum Number of Shares, then the
Company shall include in any such registration:

     

    
      
        
        

      

      
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    (i)  If the
registration is undertaken for the Company’s account: (A) first, the shares of
Common Stock or other securities that the Company desires to sell that can be
sold without exceeding the Maximum Number of Shares; (B) second, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clause (A), the shares of Common Stock, if any, including the Registrable
Securities, as to which registration has been requested pursuant to written
contractual piggy-back registration rights of security holders (pro rata in
accordance with the number of shares of Common Stock which each such person has
actually requested to be included in such registration, regardless of the number
of shares of Common Stock with respect to which such persons have the right to
request such inclusion) that can be sold without exceeding the Maximum Number of
Shares; and

     

    (ii)  If the
registration is a “demand” registration undertaken at the demand of persons
other than the holders of Registrable Securities pursuant to written contractual
arrangements with such persons, (A) first, the shares of Common Stock for the
account of the demanding persons that can be sold without exceeding the Maximum
Number of Shares; (B) second, to the extent that the Maximum Number of Shares
has not been reached under the foregoing clause (A), the shares of Common Stock
or other securities that the Company desires to sell that can be sold without
exceeding the Maximum Number of Shares; and (C) third, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clauses (A)
and (B), the Registrable Securities as to which registration has been requested
under this Section 2.3 (pro rata in accordance
with the number of Registrable Securities held by each such holder); and
(D) fourth, to the extent that the Maximum Number of Shares has not been
reached under the foregoing clauses (A), (B) and (C), the shares of Common
Stock, if any, as to which registration has been requested pursuant to written
contractual piggy-back registration rights which such other shareholders desire
to sell that can be sold without exceeding the Maximum Number of
Shares.

     

    2.3.3.  Withdrawal.  Any
holder of Registrable Securities may elect to withdraw such holder’s request for
inclusion of Registrable Securities in any Piggy-Back Registration by giving
written notice to the Company of such request to withdraw prior to the
effectiveness of the Registration Statement.  The Company may also
elect to withdraw a registration statement at any time prior to the
effectiveness of the Registration Statement.  Notwithstanding any such
withdrawal, the Company shall pay all expenses incurred by the holders of
Registrable Securities in connection with such Piggy-Back Registration as
provided in Section 3.3.

     

    3.  REGISTRATION
PROCEDURES.

     

    3.1  Filings;
Information.  Whenever the Company is required to effect the
registration of any Registrable Securities pursuant to Section 2, the
Company shall seek to effect the registration and sale of such Registrable
Securities in accordance with the intended method(s) of distribution thereof as
expeditiously as practicable, and in connection with any such
request:

     

    3.1.1.  Filing Registration
Statement.  The Company shall in an expeditious manner prepare
and file with the Commission a Registration Statement on any form for which the
Company then qualifies or which counsel for the Company shall deem appropriate
and which form shall be available for the sale of all Registrable Securities to
be registered thereunder in accordance with the intended method(s) of
distribution thereof, and shall seek to cause such Registration Statement to
become and remain effective for the period required by Section 3.1.3; provided, however, that the
Company shall only be obligated to file the Demand Registration on a Form S-3 in
accordance with the provisions of Rule 415 of the Securities Act, and provided further, however,  that
the Company shall have the right to defer the Demand Registration for up to
ninety (90) days, and any Piggy-Back Registration for such period as may be
applicable to deferment of any demand registration to which such Piggy-Back
Registration relates, in each case if the Company shall furnish to the holders a
certificate signed by the Chief Executive Officer of the Company stating that,
in the good faith judgment of the Board of Directors of the Company, it would be
materially detrimental to the Company and its shareholders for such Registration
Statement to be effected at such time.

     

    
      
        
        

      

      
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    3.1.2.  Copies.  The
Company shall, prior to filing a Registration Statement or prospectus, or any
amendment or supplement thereto, furnish without charge to the holders of
Registrable Securities included in such registration copies of such Registration
Statement as proposed to be filed, each amendment and supplement to such
Registration Statement (in each case including all exhibits thereto and
documents incorporated by reference therein), the prospectus included in such
Registration Statement (including each preliminary prospectus), and such other
documents as the holders of Registrable Securities included in such registration
may request in order to facilitate the disposition of the Registrable Securities
owned by such holders.

     

    3.1.3.  Amendments and
Supplements.  As to the Initial Registration, the Company shall
prepare and file with the Commission such amendments, including post-effective
amendments, and supplements to such Registration Statement and the prospectus
used in connection therewith as may be necessary to keep such Registration
Statement effective and in compliance with the provisions of the Securities Act
for a period of ninety (90) days from the date the Registration Statement is
first declared effective by the Commission (the “90-Day Period”) or such shorter
period that will terminate when all Registrable Securities covered by the
Registration Statement (a) have been (i) sold pursuant thereto in accordance
with the intended method(s) of distribution set forth in the Registration
Statement, (ii) transferred pursuant to Rule 144 under the Securities Act or
(iii) otherwise transferred in a manner that results in the delivery of new
securities not subject to the transfer restrictions under the Securities Act or
(b) become salable under Rule 144. Immediately after the 90-Day Period, the
Company will file a post-effective amendment to the Initial Registration for the
deregistration of any unsold Registrable Shares. As to the Demand Registration,
the Company shall prepare and file with the Commission such amendments,
including post-effective amendments, and supplements to such Registration
Statement and the prospectus used in connection therewith as may be necessary to
keep such Registration Statement effective and in compliance with the provisions
of the Securities Act for a period of two (2) years from the date the
Registration Statement is first declared effective by the Commission or such
shorter period (a) that is determined by the holders of a majority-in-interest
of the Registrable Securities held by the Investors or (b) that will terminate
when all Registrable Securities covered by the Registration Statement have been
(i) sold pursuant thereto in accordance with the intended method(s) of
distribution set forth in the Registration Statement or (ii) transferred
pursuant to Rule 144 under the Securities Act.  As to a Piggy-Back
Registration, the Company shall prepare and file with the Commission such
amendments, including post-effective amendments, and supplements to such
Registration Statement and the prospectus used in connection therewith as may be
necessary to keep such Registration Statement effective and in compliance with
the provisions of the Securities Act for a period that will be determined by the
Company.

     

    
      
        
        

      

      
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    3.1.4.  Notification.  After
the filing of a Registration Statement, the Company shall promptly, and in no
event more than two (2) business days after such filing, notify the holders of
Registrable Securities included in such Registration Statement of such filing,
and shall further notify such holders promptly and confirm such advice in
writing in all events within two (2) business days of the occurrence of any of
the following:  (i) when such Registration Statement becomes
effective; (ii) when any post-effective amendment to such Registration
Statement becomes effective; (iii) the issuance or threatened issuance by
the Commission of any stop order (and the Company shall take all actions
required to prevent the entry of such stop order or to remove it if entered);
and (iv) any request by the Commission for any amendment or supplement to
such Registration Statement or any prospectus relating thereto or for additional
information or of the occurrence of an event requiring the preparation of a
supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of the securities covered by such Registration Statement, such
prospectus will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and promptly make available to the holders of
Registrable Securities included in such Registration Statement any such
supplement or amendment; except that before filing with the Commission a
Registration Statement or prospectus or any amendment or supplement thereto,
including documents incorporated by reference, the Company shall furnish to the
holders of Registrable Securities included in such Registration Statement copies
of all such documents proposed to be filed sufficiently in advance of filing to
provide such holders with a reasonable opportunity to review such documents and
comment thereon, and the Company shall not file any Registration Statement or
prospectus or amendment or supplement thereto, including documents incorporated
by reference, to which such holders shall object.

     

    3.1.5.  State Securities Laws
Compliance.  The Company shall seek to (i) register or
qualify the Registrable Securities covered by the Registration Statement under
such securities or “blue sky” laws of such jurisdictions in the United States as
the holders of Registrable Securities included in such Registration Statement
(in light of their intended plan of distribution) may reasonably request and
(ii) take such action necessary to cause such Registrable Securities
covered by the Registration Statement to be registered with or approved by such
other governmental authorities as may be necessary by virtue of the business and
operations of the Company and do any and all other acts and things that may be
necessary or advisable to enable the holders of Registrable Securities included
in such Registration Statement to consummate the disposition of such Registrable
Securities in such jurisdictions; provided, however, that the
Company shall not be required to qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
paragraph (e) or subject itself to taxation in any such
jurisdiction.

     

    3.1.6.  Records.  The
Company shall make available for inspection by the holders of Registrable
Securities included in such Registration Statement, any Underwriter
participating in any disposition pursuant to such registration statement and any
attorney, accountant or other professional retained by any holder of Registrable
Securities included in such Registration Statement or any Underwriter, all
financial and other records, pertinent corporate documents and properties of the
Company, as shall be necessary to enable them to exercise their due diligence
responsibility, and cause the Company’s officers, directors and employees to
supply all information requested by any of them in connection with such
Registration Statement.

     

    
      
        
        

      

      
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    3.1.7.  Earnings
Statement.  The Company shall comply with all applicable rules
and regulations of the Commission and the Securities Act, and make available to
its shareholders, as soon as practicable, an earnings statement covering a
period of twelve (12) months, beginning within three (3) months after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and
Rule 158 thereunder.

     

    3.2  Obligation to Suspend
Distribution.  Upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3.1.4(iv), each
holder of Registrable Securities included in any registration shall immediately
discontinue disposition of such Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until such holder
receives the supplemented or amended prospectus contemplated by
Section 3.1.4(iv) and, if so directed by the Company, each such holder will
deliver to the Company all copies, other than permanent file copies then in such
holder’s possession, of the most recent prospectus covering such Registrable
Securities at the time of receipt of such notice.

     

    3.3  Registration
Expenses.  The Company shall bear all of its costs and expenses
incurred in connection with the Initial Registration pursuant to
Section 2.1, the Demand Registration pursuant to Section 2.2 and any
Piggy-Back Registration pursuant to Section 2.3, and all expenses incurred
in performing or complying with its other obligations under this Agreement,
whether or not the Registration Statement becomes effective, including, without
limitation: (i) all registration and filing fees; (ii) fees and
expenses of compliance with securities or “blue sky” laws (including fees and
disbursements of counsel in connection with blue sky qualifications of the
Registrable Securities); (iii) printing expenses; (iv) the Company’s
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees); and (v)  fees and disbursements of
counsel for the Company and fees and expenses for independent certified public
accountants retained by the Company. The Company shall have no obligation to pay
any costs and expenses of the holders of the Registrable Securities, including,
without limitation, fees for counsel and other parties representing such holders
and any underwriting discounts or selling commissions attributable to the
Registrable Securities being sold by the holders thereof, which fees and
underwriting discounts or selling commissions shall be borne by such
holders.  Additionally, in an underwritten offering, all selling
shareholders and the Company shall bear the expenses of the underwriter pro rata
in proportion to the respective amount of shares each is selling in such
offering.

     

    3.4  Information.  The
holders of Registrable Securities shall provide such information as may
reasonably be requested by the Company, or the managing Underwriter, if any, in
connection with the preparation of any Registration Statement, including
amendments and supplements thereto, in order to effect the registration of any
Registrable Securities under the Securities Act pursuant to Section 2 and
in connection with the Company’s obligation to comply with federal and
applicable state securities laws.

     

    
      
        
        

      

      
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    4.  INDEMNIFICATION
AND CONTRIBUTION.

     

    4.1  Indemnification by the
Company.  The Company agrees to indemnify and hold harmless
each Investor identified in the Registration Statement as a selling security
holder of Registrable Securities and each person, if any, who controls such
Investor (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act), from and against any expenses, losses,
judgments, claims, damages or liabilities, whether joint or several, arising out
of or based upon any untrue statement (or allegedly untrue statement) of a
material fact contained in any Registration Statement under which the sale of
such Registrable Securities was registered under the Securities Act, any
preliminary prospectus, final prospectus or summary prospectus contained in the
Registration Statement, or any amendment or supplement to such Registration
Statement, or arising out of or based upon any omission (or alleged omission) to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that the
Company will not be liable in any such case to the extent that any such expense,
loss, claim, damage or liability arises out of or is based upon any untrue
statement or allegedly untrue statement or omission or alleged omission made in
such Registration Statement, preliminary prospectus, final prospectus, or
summary prospectus, or any such amendment or supplement, in reliance upon and in
conformity with information furnished to the Company, in writing, by such
Investor expressly for use therein.

     

    4.2  Indemnification by the
Investors.  Each Investor agrees, as a consequence of the
inclusion of any of its Registrable Securities in a Registration Statement to
indemnify and hold harmless the Company, its directors and officers and each
person, if any, who controls the Company (within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act), against any losses,
claims, judgments, damages or liabilities, whether joint or several, insofar as
such losses, claims, judgments, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or allegedly untrue
statement of a material fact contained in any Registration Statement under which
the sale of such Registrable Securities was registered under the Securities Act,
any preliminary prospectus, final prospectus or summary prospectus contained in
the Registration Statement, or any amendment or supplement to the Registration
Statement, or arise out of or are based upon any omission or the alleged
omission to state a material fact required to be stated therein or necessary to
make the statement therein not misleading, if the statement or omission was made
in reliance upon and in conformity with information furnished in writing to the
Company by such Investor expressly for use therein, and shall reimburse the
Company, its directors and officers, and each such controlling person for any
legal or other expenses reasonably incurred by any of them in connection with
investigation or defending any such loss, claim, damage, liability or
action.  Each Investor’s indemnification obligations hereunder shall
be several and not joint and shall be limited to the amount of any net proceeds
actually received by such Investor.

     

    4.3  Conduct of Indemnification
Proceedings.  Promptly after receipt by any person of any
notice of any loss, claim, damage or liability or any action in respect of which
indemnity may be sought pursuant to Section 4.1 or 4.2, such person (the
“Indemnified
Party”) shall, if a claim in respect thereof is to be made against any
other person for indemnification hereunder, notify such other person (the “Indemnifying Party”)
in writing of the loss, claim, judgment, damage, liability or action; provided, however, that the
failure by the Indemnified Party to notify the Indemnifying Party shall not
relieve the Indemnifying Party from any liability which the Indemnifying Party
may have to such Indemnified Party hereunder, except and solely to the extent
the Indemnifying Party is actually prejudiced by such failure.  If the
Indemnified Party is seeking indemnification with respect to any claim or action
brought against the Indemnified Party, then the Indemnifying Party shall be
entitled to participate in such claim or action, and, to the extent that it
wishes, jointly with all other Indemnifying Parties, to assume control of the
defense thereof with counsel satisfactory to the Indemnified
Party.  After notice from the Indemnifying Party to the Indemnified
Party of its election to assume control of the defense of such claim or action,
the Indemnifying Party shall not be liable to the Indemnified Party for any
legal or other expenses subsequently incurred by the Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that in any
action in which both the Indemnified Party and the Indemnifying Party are named
as defendants, the Indemnified Party shall have the right to employ separate
counsel (but no more than one such separate counsel) to represent the
Indemnified Party and its controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the
Indemnified Party against the Indemnifying Party, with the fees and expenses of
such counsel to be paid by such Indemnifying Party if, based upon the written
opinion of counsel of such Indemnified Party, representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them.  No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, consent to entry of judgment or
effect any settlement of any claim or pending or threatened proceeding in
respect of which the Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified Party, unless
such judgment or settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such claim or
proceeding.

     

    
      
        
        

      

      
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    4.4  Contribution.

     

    4.4.1.  If the
indemnification provided for in the foregoing Sections 4.1, 4.2 and 4.3 is
unavailable to any Indemnified Party in respect of any loss, claim, damage,
liability or action referred to herein, then each such Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such loss, claim, damage,
liability or action in such proportion as is appropriate to reflect the relative
fault of the Indemnified Parties and the Indemnifying Parties in connection with
the actions or omissions which resulted in such loss, claim, damage, liability
or action, as well as any other relevant equitable
considerations.  The relative fault of any Indemnified Party and any
Indemnifying Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by such Indemnified Party or such Indemnifying Party and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.

     

    4.4.2.  The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 4.4 were determined by pro rata allocation or by
any other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding Section
4.4.1.  The amount paid or payable by an Indemnified Party as a result
of any loss, claim, damage, liability or action referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such Indemnified Party in
connection with investigating or defending any such action or
claim.  Notwithstanding the provisions of this Section 4.4, no
holder of Registrable Securities shall be required to contribute any amount in
excess of the dollar amount of the net proceeds (after payment of any
underwriting fees, discounts, commissions or taxes) actually received by such
holder from the sale of Registrable Securities which gave rise to such
contribution obligation.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

     

    
      
        
        

      

      
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    5.  MISCELLANEOUS.

     

    5.1  Other Registration
Rights.  The Company represents and warrants that no person,
other than a holder of the Registrable Securities, has any right to require the
Company to register any shares of the Company’s capital stock for sale or to
include shares of the Company’s capital stock in any registration filed by the
Company for the sale of shares of capital stock for its own account or for the
account of any other person (a “Registration Right”).  Notwithstanding
anything to the contrary, the Company may grant anytime after the date hereof
one or more Registration Rights.

     

    5.2  Assignment; No Third Party
Beneficiaries.  This Agreement and the rights, duties and
obligations of the Company hereunder may not be assigned or delegated by the
Company in whole or in part. This Agreement and the rights, duties and
obligations of the holders of Registrable Securities hereunder may not be
assigned or delegated by such holder of Registrable Securities in whole or in
part without the consent of the Company which consent may be withheld in the
Company’s sole discretion. Any such permitted assignee shall be deemed an
Investor for purposes of the rights, duties and obligations set forth in this
Agreement. In the event Aretex transfers any Registrable Securities to any of
its Affiliates, such Affiliate shall be deemed to be an Investor for all
purposes under this Agreement and  any shares of Common Stock acquired
by such Affiliate upon exercise of Subscription Rights shall be deemed to be
Registrable Securities.  This Agreement is not intended to confer any
rights or benefits on any persons that are not party hereto other than as
expressly set forth in Article 4.

     

    5.3  Notices. All notices,
demands, requests, consents, approvals or other communications (collectively,
“Notices”)
required or permitted to be given hereunder or which are given with respect to
this Agreement shall be in writing and shall be personally served, delivered by
reputable air courier service with charges prepaid, or transmitted by hand
delivery, telegram, telex or facsimile, addressed as set forth below, or to such
other address as such party shall have specified most recently by written
notice.  Notice shall be deemed given on the date of service or
transmission if personally served or transmitted by telegram, telex or
facsimile; provided, that if
such service or transmission is not on a business day or is after normal
business hours, then such notice shall be deemed given on the next business
day.  Notice otherwise sent as provided herein shall be deemed given
on the next business day following timely delivery of such notice to a reputable
air courier service with an order for next-day delivery.

     

    


    
      
        
        

      

      
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    To the
Company:

    


    WestPoint
International, Inc.

    507 West
10th
Street

    WestPoint,
Georgia 31833

    Attention:
President

    Attention:
General Counsel

    


    and

    


    Textile
Holding LLC

    c/o
American Real Estate Holdings Limited Partnership

    100 South
Bedford Road

    Mt.
Kisco, New York 10549

    Attention:
John Weber

    


    with a
copy to:

    


    Sonnenschein
Nath & Rosenthal LLP

    1221
Avenue of the Americas

    New York,
New York 10020

    Attn:
Peter Wolfson

    


    


    To an
individual Investor:

    


    At the
address set forth below the signature line of such investor set forth this
Agreement.

    


    5.4  Severability. This
Agreement shall be deemed severable, and the invalidity or unenforceability of
any term or provision hereof shall not affect the validity or enforceability of
this Agreement or of any other term or provision hereof.  Furthermore,
in lieu of any such invalid or unenforceable term or provision, the parties
hereto intend that there shall be added as a part of this Agreement a provision
as similar in terms to such invalid or unenforceable provision as may be
possible and be valid and enforceable.

     

    5.5  Counterparts. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, and all of which taken together shall constitute one and the
same instrument.

     

    5.6  Entire
Agreement.  This Agreement (including all agreements entered
into pursuant hereto and all certificates and instruments delivered pursuant
hereto and thereto) constitute the entire agreement of the parties with respect
to the subject matter hereof and supersede all prior and contemporaneous
agreements, representations, understandings, negotiations and discussions
between the parties, whether oral or written.

     

    5.7  Modifications and
Amendments.  No amendment, modification or termination of this
Agreement shall be binding upon any party unless executed in writing by such
party and the Company.  No amendment, modification or termination of
this Agreement shall be binding on all the parties unless executed in writing by
the Company, the Related Initial Holders and a majority-in-interested of the
Non-Related Initial Holders that beneficially own Registrable Securities at the
time of such agreement.

     

    
      
        
        

      

      
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    5.8  Titles and
Headings.  Titles and headings of sections of this Agreement
are for convenience only and shall not affect the construction of any provision
of this Agreement.

     

    5.9  Waivers and
Extensions.  Any party to this Agreement may waive any right,
breach or default which such party has the right to waive, provided that such
waiver will not be effective against the waiving party unless it is in writing,
is signed by such party, and specifically refers to this
Agreement.  Waivers may be made in advance or after the right waived
has arisen or the breach or default waived has occurred.  Any waiver
may be conditional.  No waiver of any breach of any agreement or
provision herein contained shall be deemed a waiver of any preceding or
succeeding breach thereof nor of any other agreement or provision herein
contained.  No waiver or extension of time for performance of any
obligations or acts shall be deemed a waiver or extension of the time for
performance of any other obligations or acts.

     

    5.10  Remedies
Cumulative.  In the event that the Company fails to observe or
perform any covenant or agreement to be observed or performed under this
Agreement, the Investor or any other holder of Registrable Securities may
proceed to protect and enforce its rights by suit in equity or action at law
upon the posting of a sufficient bond, whether for specific performance of any
term contained in this Agreement or for an injunction against the breach of any
such term or in aid of the exercise of any power granted in this Agreement or to
enforce any other legal or equitable right, or to take any one or more of such
actions, without being required to post a bond.  None of the rights,
powers or remedies conferred under this Agreement shall be mutually exclusive,
and each such right, power or remedy shall be cumulative and in addition to any
other right, power or remedy, whether conferred by this Agreement or now or
hereafter available at law, in equity, by statute or otherwise.

     

    5.11  Governing Law. This
Agreement shall be governed by, interpreted under, and construed in accordance
with the internal laws of the State of New York applicable to agreements made
and to be performed within the State of New York, without giving effect to any
choice-of-law provisions thereof that would compel the application of the
substantive laws of any other jurisdiction.

     

    5.12  Waiver of Trial by
Jury. Each party hereby irrevocably and unconditionally waives the right
to a trial by jury in any action, suit, counterclaim or other proceeding
(whether based on contract, tort or otherwise) arising out of, connected with or
relating to this Agreement, the transactions contemplated hereby, or the actions
of the Investor in the negotiation, administration, performance or enforcement
hereof.

     

    
      
        
        

      

      
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    IN WITNESS WHEREOF, the
parties have caused this Registration Rights Agreement to be executed and
delivered by their duly authorized representatives as of the date first written
above.

     

    WestPoint International,
Inc.

    a
Delaware corporation

    


    


    By: /s/ Jon
Weber__________________________

    Name:  Jon Weber

    Title:   President

    


    


    INVESTORS:

     

    
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