CONE XXXXX CORPORATION
FIRST SUPPLEMENTAL INDENTURE
FIRST SUPPLEMENTAL INDENTURE, dated as of the ___ day of ________, 2001
(herein called the "Supplement"), between CONE XXXXX CORPORATION, a corporation
duly organized and existing under the laws of the State of North Carolina
(hereinafter referred to as the "Issuer"), and THE BANK OF NEW YORK, a
banking corporation duly organized and existing under the laws of the State of
New York (hereinafter referred to as the "Trustee"), as Trustee under the
Indenture dated as of February 15, 1995 (the "Indenture") between the Issuer and
the Trustee as successor trustee to Wachovia Bank of North Carolina, N.A.
Capitalized terms used in this Supplement and not otherwise defined herein shall
have the meanings set forth in the Indenture.
WHEREAS, the Issuer has previously issued 8-1/8% Debentures Due March
15, 2005 (the "8-1/8% Debentures") in accordance with the terms of the
Indenture; and
WHEREAS, the 8-1/8% Debentures constitute the only series of Debentures
issued and outstanding under the Indenture; and
WHEREAS, on January 28, 2000 the Issuer entered into certain General
Security Instruments (as such term is defined in the Credit Agreement, dated as
of January 28, 2000 and as from time to time in effect, among the Issuer, Bank
of America, N.A., as agent and Lender, and the Lenders party thereto), which
General Security Instruments collectively provide (i) for the granting of a
security interest in substantially all of the Issuer's assets to certain of its
creditors and, (ii) as required by Section 3.9 of the Indenture, for the
granting of a pari passu security interest in the same assets to the Trustee
(the "Trustee's Lien") for the benefit of the Holders of the 8-1/8% Debentures
(the "Holders"); and
WHEREAS, in accordance with Section 7.2 of the Indenture, the Issuer
and the Trustee may amend the Indenture or the 8-1/8% Debentures and the rights
of the Holders thereunder with the written consent of the Holders of at least a
majority in principal amount of the 8-1/8% Debentures; provided, that no such
amendment may, without the consent of each Holder, (1) reduce the amount of
8-1/8% Debentures whose Holders must consent to such amendment, (2) reduce the
rate of or extend the time for payment of interest on any 8-1/8% Debenture, (3)
reduce the principal of or extend the final maturity of any 8-1/8% Debenture,
(4) reduce any amount payable on redemption of any 8-1/8% Debenture, (5) make
any 8-1/8% Debenture payable in any coin or currency other than that provided in
the 8-1/8% Debentures, or (6) impair or affect the right of any Holder to
institute suit for payment of the 8-1/8% Debentures; and
WHEREAS, the Issuer has solicited consents from the Holders to certain
amendments to the Indenture and to the release of the Trustee's Lien pursuant to
a consent solicitation dated _______, 2000 (as the same may be amended or
extended from time in accordance with its terms, the "Exchange Offer");
WHEREAS, Holders of a majority in principal amount of the 8-1/8%
Debentures have consented to the amendments to the Indenture and to the release
of the Trustee's Lien contained herein by acceptance of the Exchange Offer; and
WHEREAS, the Issuer desires to amend the Indenture and to cause the
Trustee to release the Trustee's Lien in accordance with Section 7.2 thereof and
has determined that the requirements of Section 7.2 of the Indenture have been
satisfied and has requested the Trustee to join with it in the execution and
delivery of this Supplement; all requirements necessary to make this Supplement
a valid instrument, in accordance with its terms, have been met; and the
execution and delivery hereof have been in all respects duly authorized.
NOW, THEREFORE, for good and valuable consideration the sufficiency of
which is hereby recognized, the Issuer covenants and agrees with the Trustee as
follows:
Article 1
AMENDMENTS TO THE INDENTURE
Section 1.1 Amendment of Definition of "Consolidated Net Tangible
Assets". The definition of "Consolidated Net Tangible Assets" in Section 1.1 of
the Indenture is hereby amended to read in its entirety as follows:
" 'Consolidated Net Tangible Assets' means, at any date, the total
assets appearing on the most recently prepared consolidated balance
sheet of the Issuer and its Subsidiaries as of the end of a fiscal
quarter of the Issuer, prepared in accordance with generally accepted
accounting principles, plus the outstanding balance of any accounts
receivable securitization facility, less (a) all current liabilities
shown on such balance sheet (other than current maturities of long-term
debt), (b) all intangible assets shown on such balance sheet, and (c)
all assets that do not constitute collateral securing payment of the
11% Debentures other than assets held in any accounts receivable
securitization facility and prepaid expenses as determined in
accordance with generally accepted accounting principles. "Intangible
assets" means the value (net of any applicable reserves), as shown on
or reflected in such balance sheet of: (i) all trade names, trademarks,
licenses, patents, copyrights and goodwill; (ii) organizational costs;
and (iii) deferred charges (other than prepaid items such as insurance,
pensions, taxes, interest, commissions, rents and similar items and
tangible assets being amortized); but in no event shall the term
"intangible assets" include product development costs."
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Section 1.2 Amendment of Definition of "Subsidiary". The
definition of "Subsidiary" in Section 1.1 of the Indenture is hereby amended to
read in its entirety as follows:
" 'Subsidiary' means any corporation, association, limited liability
company, partnership, joint venture or other business entity of which
at least a majority of the total voting power of outstanding securities
or other interests entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees
thereof is at the time directly or indirectly owned or controlled by
the Issuer or by one or more Subsidiaries or by the Issuer and one or
more Subsidiaries; provided, however, that the term "Subsidiary" shall
not include (i) the joint venture between Cone Xxxxx (Mexico), S.A. de
C.V. and Compania Industrial xx Xxxxxx, X.X. de C.V., (ii) Cone Xxxxx
(Mexico), S.A. de C.V. or (iii) any other corporation, association,
limited liability company, partnership, joint venture or business
entity substantially all the property of which is located, or
substantially all of the business of which is carried on, outside the
United States of America; provided, further, that notwithstanding the
foregoing, the term "Subsidiary" shall include Cone Receivables II, LLC
or any other special purpose entity which purchases and securitizes
accounts receivable of the Issuer and its Subsidiaries and in which the
Issuer and one or more Subsidiaries holds the primary economic
interest."
Section 1.3 Amendment of Definition of "Indebtedness". The
definition of "Indebtedness" in Section 1.1 of the Indenture is hereby amended
to read in its entirety as follows:
" 'Indebtedness' means, without duplication, (a) all obligations for
borrowed money, (b) all obligations evidenced by bonds, debentures,
notes or other similar instruments, (c) all obligations in respect of
letters of credit or bankers acceptances or similar instruments (or
reimbursement obligations with respect thereto), (d) all obligations to
pay the deferred purchase price of property or services, except trade
accounts payable arising in the ordinary course of business, (e) all
obligations as lessee which are capitalized in accordance with
generally accepted accounting principles, (g) all Indebtedness of
others guaranteed by the Issuer or any of its Subsidiaries or for which
the Issuer or any of its Subsidiaries is legally responsible or liable
(whether by agreement to purchase indebtedness of, or to supply funds
or to invest in, others), and (g) the balance of any accounts
receivable securitization facility."
Section 1.4 Addition of Definition of "11% Debentures". "11%
Debentures" means up to $85,000,000 secured subordinated debentures of the
Issuer issued pursuant to Indenture dated as of the ___day of ______________,
2000 between Cone Xxxxx Corporation and The Bank of New York, as Trustee.
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Section 1.5 Amendment of Section 3.9(i). Section 3.9(i) of the
Indenture is hereby amended to read in its entirety as follows:
"(i) liens not permitted by clauses (a) through (h) above or (k) below,
if at the time of, and after giving effect to, the execution and
delivery of the security document granting any such lien (or at the
time of, and after giving effect to, the assumption of any such lien),
the aggregate amount of all outstanding Indebtedness of the Issuer and
its Subsidiaries (considering the maximum amount committed under any
revolving credit facility as outstanding Indebtedness) (without
duplication) secured by all such liens not so permitted by clauses (a)
through (h) above or (k) below, together with the Attributable Debt in
respect of Sale and Lease-Back Transactions permitted by paragraph (a)
of Section 3.10, does not exceed 55% of Consolidated Net Tangible
Assets; or"
Section 1.6 Addition of New Clause (k) to Section 3.9. Section 3.9
of the Indenture is hereby amended by changing the period at the end of clause
(j) of Section 3.9 to "; or" and adding the following new clause (k) immediately
thereafter:
"(k) liens securing the 11% Debentures of the Issuer or any extensions,
renewals or replacements thereof; provided, however, that the Principal
amount of Indebtedness secured thereby shall not exceed the Principal
amount of Indebtedness so secured at the time of such extension,
renewal or replacement, and that such extension, renewal or replacement
shall be limited to all or a part of the assets (or any replacements
therefor) which secured the lien so extended, renewed or replaced."
Article 2
RELEASE OF LIEN
Section 2.1 Release of Lien. Pursuant to the direction of the Holders
of at least a majority in principal amount of the 8 1/8% Debentures, the Trustee
hereby confirms and consents to the release of the Trustee's Lien effective on
the date hereof and agrees, at the Issuer's expense, to take such further
actions as the Issuer may reasonably request to evidence such release or in
furtherance of the purposes of this Section. The Trustee hereby further confirms
that, after giving effect to this Section and the release contemplated hereby,
the Debentures will be unsecured and any rights which the Trustee or any Holder
might have otherwise or formerly had as a beneficiary of any lien or security
interest created under the General Security Instruments shall be terminated.
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Article 3
MISCELLANEOUS
Section 3.1 Effectiveness of Provisions. This Supplement shall be
effective and binding upon the Issuer, the Trustee and the Holders as of the day
and year first written above.
Section 3.2 Execution of Supplement. This Supplement is executed and
shall be construed as an indenture supplemental to the Indenture and, as
provided in the Indenture, this Supplement forms a part thereof.
Section 3.3 Conflict with Trust Indenture Act. If and to the extent
that any provision hereof limits, qualifies or conflicts with the duties imposed
by Sections 310 through 317, inclusive, of the Trust Indenture Act of 1939, as
amended, such imposed duties shall control.
Section 3.4 Successors and Assigns. All covenants and agreements in
this Supplement by the Issuer shall bind its successors and assigns, whether so
expressed or not.
Section 3.5 Separability Clause. In case any one or more of the
provisions contained in this Supplement, the Indenture or the Debentures of any
series shall for any reason be held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability shall not affect
any other provisions of this Supplement, the Indenture or such Debentures, but
this Supplement, the Indenture and such Debentures shall be construed as if such
invalid or illegal or unenforceable provision had never been contained herein or
therein.
Section 3.6 Benefits of Supplement. Nothing in this Supplement or in
the Indenture, express or implied, shall give to any person, other than the
parties hereto and their successors hereunder and the Holders (to the extent
specified herein or therein), any benefit or any legal or equitable right,
remedy or claim under this Supplement.
Section 3.7 Governing Law. This Supplement shall be governed by, and
construed in accordance with, the laws of the State of New York but without
giving effect to applicable principles of conflicts of law to the extent that
the application of the laws of another jurisdiction would be required thereby.
Section 3.8 Execution and Counterparts. This Supplement may be executed
in any number of counterparts, each of which shall be deemed to be an original;
but such counterparts shall together constitute but one and the same instrument.
Section 3.9 Miscellaneous. Except as expressly supplemented by
this Supplement, the Indenture shall remain unchanged and in full force and
effect.
IN WITNESS WHEREOF, the Issuer and the Trustee have caused this
Supplement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
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CONE XXXXX CORPORATION
By: ____________________________________
Title: _________________________________
THE BANK OF NEW YORK, as TRUSTEE
By: ____________________________________
Title: _________________________________
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