UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
October 10, 2000
Commission File Number: 33-75176
CONSOLTEX INC.
New Brunswick
(I.R.S. Employer Identification No.)
8555 Route Transcanadienne, Saint-Laurent, Quebec, Canada H45 1Z6
(514) 333-8800
<PAGE>
Item 1. Change in Control of Registrant.
Consoltex Inc., a New Brunswick (Canada) corporation,has entered
into a series of transactions described below which constitute
a change in control of the Registrant (the "CHANGE IN CONTROL").
On September 29, 2000, AIP/CGI NB Acquisition Corp., a New Brunswick
(Canada) corporation ("AIP/CGI"), exercised its option (the "OPTION")
to purchase 3,140,000 Multiple Voting Shares of the Registrant
(the "SHARES") from Les Gantiers Holding B.V. ("LGH"), constituting
51.33% of the voting power of the Registrant. The net consideration
paid by AIP/CGI to LGH for the Shares was $3,123,000(1) and was
contributed to AIP/CGI by Consoltex Holdings, Inc. ("HOLDINGS"),
the sole shareholder of AIP/CGI.
Immediately prior to AIP/CGI's exercise of the Option, AIP/CGI held
securities representing the right to vote 48.67% of the total votes
attributable to the outstanding securities of the Registrant. Immediately
after the exercise of the Option, AIP/CGI held securities representing the
right to vote 100% of the total votes attributable to the outstanding
securities of the Registrant.
On October 2, 2000, the Registrant amalgamated with AIP/CGI and the
amalgamated corporation changed its name to Consoltex Inc. and continues
as the Registrant. As part of the Change in Control, the Registrant intends
to sell all of the capital stock of Consoltex (USA) Inc. ("CONSOLTEX USA"),
a wholly-owned subsidiary of the Registrant the Registrant, to Holdings.
In connection with the Change in Control, holders of not less than a
majority in aggregate principal amount of the Registrant's 11% Senior
Subordinated Notes due 2003 (the "NOTES") consented to the Change in
Control and waived certain requirements under the Indenture governing
the Notes, and the Registrant entered into the Second Supplemental
Indenture, dated as of September 29, 2000, by and among the Registrant,
Consoltex USA, The Balson-Hercules Group Ltd., LINQ Industrial Fabrics,
Inc., Rafytek, S.A. de C.V., Consoltex Mexico, S.A. de C.V. and U.S.
Bank Trust National Association (formerly First Trust National Association),
governing the Notes (the "SECOND SUPPLEMENTAL INDENTURE").
Holdings issued a convertible debenture in the principal amount of
$2,123,000 (the "DEBENTURE") to LGH, pursuant to which the holders of
a majority in aggregate principal amount of the Debenture are entitled,
under certain circumstances, to have appointed one representative to the
board of directors of Holdings.
*FOOTNOTES**
{1} The gross consideration paid by AIP/CGI to exercise the Option
was $12,164,538.51, which amount was first offset against the
obligations of LGH under the Amended and Restated Loan Agreement
among AIP/CGI, LGH and Les Gantiers Limited, dated as of October
20, 1999, as amended.
<PAGE>
Item 7. Financial Statements and Exhibits
The following is a list of exhibits filed herewith.
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
====== ===========
<S> <C>
2.1 Second Supplemental Indenture, dated September 29, 2000
</TABLE>
<PAGE>
Execution Version
CONSOLTEX INC.
CONSOLTEX (USA) INC.
THE BALSON-HERCULES GROUP LTD.
LINQ INDUSTRIAL FABRICS, INC.
RAFYTEK, S.A. DE C.V.
CONSOLTEX MEXICO, S.A. DE C.V.
AND
U.S. BANK TRUST NATIONAL ASSOCIATION, TRUSTEE
=================================================
SECOND SUPPLEMENTAL INDENTURE
DATED AS OF SEPTEMBER 29, 2000
=================================================
<PAGE>
SECOND SUPPLEMENTAL INDENTURE
This SECOND SUPPLEMENTAL INDENTURE, (the "SECOND SUPPLEMENTAL INDENTURE"),
dated as of September 29, 2000, is made by and among Consoltex Inc., a
corporation organized under the laws of New Brunswick, Canada and successor
after the amalgamation with AIP/CGI NB Acquisition Corp., Consoltex (USA)
Inc., a New York corporation ("CONSOLTEX USA" and together with Consoltex
Inc., the "ISSUERS"), The Balson-Hercules Group Ltd., a Rhode Island
corporation, LINQ Industrial Fabrics, Inc., a Delaware corporation ("LINQ"),
Rafytek, S.A. de C.V., a corporation organized under the laws of Mexico
("RAFYTEK"), Consoltex Mexico, S.A. de C.V., a corporation organized under
the laws of Mexico ("CONSOLTEX MEXICO" and together with the Issuers,
certain affiliates of the Issuers, LINQ and Rafytek, the "COMPANY"), and
U.S. Bank Trust National Association (formerly First Trust National
Association) (the "TRUSTEE"), governing the 11% Notes due 2003 of the
Issuers (the "NOTES").
WHEREAS, the Issuers, the original subsidiary guarantors (the "ORIGINAL
GUARANTORS") and the Trustee are parties to the Indenture, dated September
30, 1993 (the " FIRST INDENTURE"), pursuant to which the Issuers issued
the Notes;
WHEREAS, the Issuers, the Original Guarantors, Rafytek, Consoltex Mexico
(together with the Original Guarantors and Rafytek, the "GUARANTORS") and
the Trustee are parties to the Supplemental Indenture, dated August 18,
1994 (together with the First Indenture, the "INDENTURE");
WHEREAS, Section 9.02 of the Indenture authorizes the Issuers, the
Guarantors and the Trustee, from time to time, with the consent of the
Holders of not less than a majority in principal amount of Notes and when
authorized by appropriate action, to amend or supplement the Indenture by
supplemental indenture for the purpose therein set forth;
WHEREAS, in accordance with Section 9.02 of the Indenture, the Trustee,
the Issuers, the Guarantors and the Holders of not less than a majority
in principal amount of the Notes as of the date hereof have agreed to
amend or supplement certain terms and conditions of the Indenture to
permit the restructuring of the Company and Consoltex Holdings, Inc.
("CHI") as more fully set forth herein; and
WHEREAS, the Issuers and the Guarantors, by appropriate corporate action,
have determined to amend and supplement the provisions of the Indenture
in the manner described herein and have taken all acts necessary to duly
authorize, execute and deliver this Second Supplemental Indenture and to
constitute this Second Supplemental Indenture a legal, valid and binding
agreement of each of the Issuers and the Guarantors enforceable against
each of them in accordance with the terms herein.
NOW, THEREFORE, in consideration of the premises set forth herein, the
parties hereto agree as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 1.1 GENERAL. For all purposes of this Second Supplemental
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
(a) capitalized terms used herein without definition shall have
the meanings specified in the Indenture;
(b) all references herein to Articles and Sections, unless
otherwise specified, refer to the corresponding Articles and Sections
of this Second Supplemental Indenture and, where so specified, to the
Articles and Sections of the Indenture as amended and supplemented by
this Second Supplemental Indenture; and
(c) the terms "hereof," "herein," "hereby," "hereto," "hereunder"
and "herewith" refer to this Second Supplemental Indenture.
ARTICLE 2
AMENDMENTS TO INDENTURE
Section 2.1 AMENDMENT OF SECTION 1.01.
(a) Section 1.1 of the Indenture is hereby amended by deleting the
definition of "GAAP" and replacing it in its entirety with the following:
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of
the accounting profession, which are in effect from time to time.
(b) Section 1.1 of the Indenture is hereby amended by inserting
immediately after the definition of "CHANGE OF CONTROL" and immediately
before the definition of "CONSOLIDATED NET INCOME" the following:
"CHI" means Consoltex Holdings, Inc., a Delaware corporation.
(c) Section 1.1 of the Indenture is hereby amended by deleting
the definition of "CHANGE OF CONTROL" and replacing it in its entirety with
the following:
"CHANGE OF CONTROL" means the occurrence of any of the following:
(i) the sale, lease or transfer, in one or a series of related
transactions, of all or substantially all of the assets of CHI
to any person or group (as such term is used in Section 13(d)(3)
of the Exchange Act)(other than the Principals or their Related
Parties);
(ii) the adoption of a plan relating to the liquidation or
dissolution of CHI; or
(iii) the acquisition by any person or group (as such term
is used in Section 13(d)(3) of the Exchange Act) (other than
the Principals and their Related Parties) of direct or
indirect majority in interest (more than 50%) of the voting
power of the voting stock of CHI by way of amalgamation,
merger or consolidation or otherwise.
(d) Section 1.1 of the Indenture is hereby amended by deleting
the definition of "PRINCIPALS" and replacing it in its entirety with the
following:
"PRINCIPALS" means American Industrial Partners Capital Fund
II, L.P., a Delaware limited partnership, and its Affiliates.
(e) Section 1.1 of the Indenture is hereby amended by inserting
immediately after the definition of "SIGNIFICANT SUBSIDIARY" and
immediately before the definition of "SUBSIDIARY" the following:
"SPECIAL CONTRIBUTION" means the cash contribution of
US$11,587,000 from CHI to any of the Issuers, US$9,464,000 of
which was contributed to CHI by American Industrial Partners
Capital Fund II, L.P., and US$2,123,000 of which was contributed
to CHI by Les Gantiers Holding B.V.
Section 2.2 AMENDMENT OF SECTION 4.07. Section 4.07 of the Indenture
is hereby amended by inserting in subsection (c) thereof immediately
preceding the comma ending "CLAUSE (Y)" the following:
; PROVIDED, HOWEVER, that the Special Contribution shall not be
included in the calculation under this clause (y).
Section 2.3 AMENDMENT OF SECTION 4.11. Section 4.11 of the Indenture is
hereby amended by deleting "PROVISO (III)" and replacing it in its
entirety with the following:
(iii) the payment of reasonable fees to the Principals and
their Affiliates in connection with consulting, management,
investment banking or financial advisory services rendered
to the Issuers or their respective Subsidiaries in an
aggregate amount not to exceed US$1.4 million per annum,
Section 2.4 AMALGAMATION OF CONSOLTEX INC. AND AIP/CGI NB ACQUISITION CORP.
Immediately upon the effectiveness of the amalgamation of Consoltex Inc.
and AIP/CGI NB Acquisition Corp. (the "AMALGAMATION"), Consoltex Inc., the
successor after the Amalgamation, hereby assumes all of the obligations of
its predecessor hereunder and under the Indenture and the Notes.
ARTICLE 3
MISCELLANEOUS
Section 3.1 EFFECTIVENESS. This Second Supplemental Indenture shall
become effective on and as of the date the counterparts hereto shall have
been executed and delivered by each of the parties hereto.
Section 3.2 GOVERNING LAW. This Second Supplemental Indenture shall be
governed by and construed in accordance with the laws of the State of New
York applicable to contracts to be performed entirely in that State.
Section 3.3 COUNTERPARTS. This Second Supplemental Indenture may be
signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument.
Section 3.4 SEVERABILITY. In case any provision in this Second Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 3.5 RATIFICATION. Except as expressly amended or supplemented hereby,
each provision of the Indenture shall remain in full force and effect and,
as amended or supplemented hereby, the Indenture is in all respects agreed to,
ratified and confirmed by each of the Issuers, the Guarantors and the Trustee.
Section 3.6 TRUSTEE. The Trustee accepts the trusts created by the Indenture,
as supplemented by this Second Supplemental Indenture, and agrees to perform
the same upon the terms and conditions of the Indenture, as amended and
supplemented by this Second Supplemental Indenture.
Section 3.7 RECITALS. The recitals contained herein shall be taken as
statements of the Issuers and the Guarantors, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Second Supplemental Indenture.
Section 3.8 REAFFIRMATION. The parties hereto make and reaffirm as of
the date of execution of this Second Supplemental Indenture all of their
respective representations, covenants and agreements set forth in the
Indenture.
Section 3.9 ASSIGNMENT. All covenants and agreements of the Issuers, the
Guarantors and the Trustee in this Second Supplemental Indenture shall bind
each of their respective successors and assigns, whether so expressed or not.
Section 3.10 THIRD-PARTY BENEFICIARIES. Nothing in this Second Supplemental
Indenture, express or implied, shall give to any Person, other than the
parties hereto and their successors under the Indenture and the Holders of
the Notes, any benefit or any legal or equitable right, remedy or claim under
the Indenture.
Section 3.11 TRUST INDENTURE ACT. If any provisions hereof limit, qualify
or conflict with a provision of the Trust Indenture Act of 1939, as may
be amended from time to time (the "TIA"), required under the TIA to be
a part of and govern this Second Supplemental Indenture, the latter provision
shall control. If any provision hereof modifies or excludes any provision
of the TIA that may be so modified or excluded, the latter provision
shall be deemed to apply to this Second Supplemental Indenture as so
modified or excluded, as the case may be.
Section 3.12 UNITY. All provisions of this Second Supplemental Indenture
shall be deemed to be incorporated in, and made a part of, the Indenture;
and the Indenture, as amended and supplemented by this Second Supplemental
Indenture, shall be read, taken and construed as one and the same instrument.
[END OF PAGE]
[SIGNATURE PAGES FOLLOW]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental
Indenture to be duly executed as of the day and year first above written.
CONSOLTEX INC.
By: /s/Paul J. Bamatter
===============================
Name: Paul J. Bamatter
Title: Vice-President Finance and
Chief Financial Officer
CONSOLTEX (USA) INC.
By: /s/Paul J. Bamatter
==============================
Name: Paul J. Bamatter
Title: Vice-President Finance and
Chief Financial Officer
THE BALSON-HERCULES GROUP, LTD.
By: /s/Paul J. Bamatter
==============================
Name: Paul J. Bamatter
Title: Vice-President Strategic
Planning
LINQ INDUSTRIAL FABRICS, INC.
By: /s/Paul J. Bamatter
============================
Name: Paul J. Bamatter
Title: Vice-President Strategic
Planning
RAFYTEK, S.A. DE C.V.
By: /s/Paul J. Bamatter
============================
Name: Paul J. Bamatter
Title: Director
CONSOLTEX MEXICO, S.A. DE C.V.
By: /s/C. Suzanne Crawford
============================
Name: C. Suzanne Crawford
Title: Attorney-in-Fact
U.S. BANK TRUST NATIONAL ASSOCIATION
By: /s/Joel J. Geist
=============================
Name: Joel J. Geist
Title: Assistant Vice-President
<PAGE>
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.
CONSOLTEX INC.
(Registrant)
Dated: October 10, 2000 By: /s/ Paul J. Bamatter
======================================
Paul J. Bamatter
Vice-President Finance and
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
====== ============
<S> <C>
2.1 Second Supplemental Indenture, dated September 29, 2000
</TABLE>
