EXHIBIT 99.5
____________, 2000
EXCHANGE AGENT AGREEMENT
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Ladies and Gentlemen:
Upon the terms and subject to the conditions set forth in the
Prospectus and Consent Solicitation Statement dated __________ __, 2000 (the
"Prospectus") and the related Consent and Letter of Transmittal (the "Consent
and Letter of Transmittal"), which together, as they may be supplemented or
amended from time to time, constitute the "Exchange Offer," Cone Mills
Corporation, a North Carolina corporation (the "Company"), is offering to
exchange all its outstanding 8-1/8% Debentures Due March 15, 2005 (the "8-1/8%
debentures") for a combination of 11% Secured Subordinated Debentures Due March
15, 2005 (the "11% debentures") and shares of common stock of the Company (the
"Common Stock" and such 11% debentures and Common Stock collectively the "New
Securities"). In conjunction with the Exchange Offer, Cone is soliciting (the
"Consent Solicitation") consents (the "Consents") for certain proposed
amendments (the "Proposed Amendments") to the indenture under which the 8-1/8%
debentures were issued and to release the debentureholders' interest in the
collateral securing the 8-1/8% debentures.
The Company hereby appoints The Bank of New York to act as Exchange
Agent in connection with the Exchange Offer. References hereinafter to "you"
shall refer to The Bank of New York.
The Company commenced the Exchange Offer on ____________ __, 2000. The
Consent and Letter of Transmittal that accompanies the Prospectus is to be used
by the holders of 8-1/8% debentures to accept the Exchange Offer and to deliver
their Consents, and contains instructions with respect to the delivery of
certificates for 8-1/8% debentures tendered.
The Exchange Offer shall expire at 12:00 Midnight, New York City time,
on __________, 2000 (the "Initial Expiration Date"), or on such subsequent date
or time to which the Company may extend the Exchange Offer. The Company
expressly reserves the right to extend the Exchange Offer from time to time and
may extend the Exchange Offer by giving notice to you before 9:00 a.m., New York
City time, on the business day following the scheduled
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Expiration Date. The later of the Initial Expiration Date or the latest time
and date to which the Exchange Offer may be so extended is hereinafter referred
to as the "Expiration Date."
1. You will establish and maintain a book-entry account in respect of the
8-1/8% debentures at The Depository Trust Company ("DTC") in connection with the
Exchange Offer, and you will comply with DTC's Agent Operating Procedures to
make the Exchange Offer eligible for DTC's Automated Tender Offer Procedures
("ATOP") system, including the inspection of the Agent's Message prepared in
connection with the Exchange Offer (including the notation that agreement and
acknowledgment of such Agent's Message by a tendering holder of 8-1/8%
debentures will be deemed to constitute a Consent as defined in the Exchange
Offer) and correction of any deficiencies therein. Any financial institution
that is a participant in the DTC system may make book-entry delivery of the
8-1/8% debentures by causing DTC to transfer such 8-1/8% debentures into the
account maintained by you, pursuant to this paragraph, in accordance with DTC's
procedure for such transfer, and you may effect a withdrawal of 8-1/8%
debentures through such account by book-entry movement. The account shall be
maintained until all 8-1/8% debentures tendered pursuant to the Exchange Offer
shall have been either accepted for exchange or returned.
2. You are to examine each of the Consents and Letters of Transmittal and
certificates for 8-1/8% debentures and any other documents delivered or mailed
to you by or for holders of 8-1/8% debentures of the Company to ascertain
whether: (i) the Consents and Letters of Transmittal and any such other
documents are duly executed and properly completed in accordance with
instructions set forth therein, (ii) the 8-1/8% debentures have otherwise been
properly tendered and (iii) the Consents have otherwise been properly delivered.
In addition, you are to examine each confirmation of tender via DTC's ATOP
system received by you (whether in printed or electronic format) to ascertain
whether: (i) the acknowledgment and agreement to the Agent's Message contained
in such confirmation has been duly executed and properly completed in accordance
with DTC's procedures therefor and (ii) the 8-1/8% debentures have otherwise
been properly tendered and (iii) the Consents have otherwise been properly
delivered. In each case where the Consent and Letter of Transmittal,
acknowledgment and agreement to Agent's Message or any other document has been
improperly completed or executed or any of the certificates for 8-1/8%
debentures are not in proper form for transfer or some other irregularity in
connection with the acceptance of the Exchange Offer exists, you will endeavor
to inform the presenters of the need for fulfillment of all requirements and to
take any other action as may be necessary or advisable to cause such
irregularity to be corrected.
3. With the approval of an authorized officer of the Company (such
approval, if given orally, to be confirmed in writing), you are authorized to
waive any irregularities in connection with any tender pursuant to the Exchange
Offer.
4. Tenders of 8-1/8% debentures and Consents may be made only as described
in the Exchange Offer and 8-1/8% debentures shall be considered properly
tendered and Consents shall be considered properly delivered only when:
a. 8-1/8% debentures (i) for which physical certificates are
delivered, are covered by a properly completed and duly executed
Consent and Letter of Transmittal
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received by you (together with any other required documents) prior to
the Expiration Date, (ii) delivered pursuant to the procedures for
book-entry transfer set forth in the Exchange Offer, are covered by a
properly acknowledged Agent's Message (whether in printed or electronic
format) received by you together with any other required documents
prior to the Expiration Date or (iii) for which an appropriate Notice
of Guaranteed Delivery relating to the Exchange Offer has been
delivered by an Eligible Institution (as defined in the Securities
Exchange Act of 1934, as amended, an "Eligible Institution") and
received by you in accordance with the Exchange Offer prior to the
Expiration Date, are covered either by a properly completed and duly
executed Consent and Letter of Transmittal or by a properly
acknowledged Agent's Message (whether in printed or electronic format),
as appropriate, in either case received by you together with any other
required documents within three New York Stock Exchange, Inc. trading
days after the Expiration Date; and
b. certificates for 8-1/8% debentures (together with any other
required documents) are received by you, or you have received
confirmation of receipt of such 8-1/8% debentures pursuant to the
book-entry transfer procedures set forth in the Exchange Offer, prior
to the Expiration Date or, in the case of 8-1/8% debentures for which
an appropriate Notice of Guaranteed Delivery has been delivered to you
by an Eligible Institution and received by you in accordance with the
Exchange Offer prior to the Expiration Date, certificates for such
8-1/8% debentures (together with any other required documents) are
received by you or you have received confirmation of receipt of such
8-1/8% debentures pursuant to the book-entry transfer procedures set
forth in the Exchange Offer, within three New York Stock Exchange, Inc.
trading days after the date of such Notice of Guaranteed Delivery; and
c. the adequacy of the items relating to certificates for
8-1/8% debentures and the related Consents and Letters of Transmittal,
and the adequacy of the items relating to confirmations of book-entry
transfers and the related Agent's Messages, has been favorably passed
upon as above provided.
Notwithstanding the provisions of this paragraph 4, 8-1/8% debentures
that the Company shall approve as having been properly tendered shall be
considered to be properly tendered and Consents that the Company shall approve
as having been properly delivered shall be considered to be properly delivered.
A tender made on the basis of an appropriate Notice of Guaranteed
Delivery will not be considered to have been properly made unless certificates
for all of the 8-1/8% debentures covered thereby have been deposited (either
physically or pursuant to book-entry transfer) within the time periods provided
in this paragraph 4 and the Exchange Offer; and when all such certificates have
been so delivered and all other requirements in this paragraph 4 and the
Exchange Offer have been complied with, the tender will be deemed effected at
the time of
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receipt by you of the Consent and Letter of Transmittal or appropriate Notice
of Guaranteed Delivery, as the case may be, provided for in the Exchange Offer
and this paragraph 4.
5. You shall advise the Company with respect to any 8-1/8% debentures
received subsequent to the Expiration Date and accept its instructions with
respect to disposition of such 8-1/8% debentures.
6. You shall accept tenders:
a. in cases where the 8-1/8% debentures are registered in two
or more names only if the Consent and Letter of Transmittal is signed
by all named holders;
b. in cases where the person executing the Consent and Letter
of Transmittal is acting in a fiduciary or a representative capacity,
only when proper evidence of his or her authority so to act is
submitted; and
c. from persons other than the registered holder provided that
normal transfer requirements, including any applicable transfer taxes,
are fulfilled.
7. You shall not accept partial tenders of 8-1/8% debentures. In each
case where the Consent and Letter of Transmittal or Notice of Guaranteed
Delivery purports to offer for exchange less than all of a holder's 8-1/8%
debentures, you will endeavor to inform the presenter of the need to offer for
exchange all, and not less than all, of the holder's 8-1/8% debentures to
receive New Securities and to assist the presenter in taking any action as may
be necessary or advisable to cause such irregularity to be corrected.
8. The Company does not intend to issue more than _______ shares of Common
Stock for $15,000,000 of 8-1/8% debentures. However, the Company reserves the
right to increase the number of shares of Common Stock to be issued in the
Exchange Offer to a maximum of ________shares for up to $25,000,000 aggregate
principal amount of 8-1/8% debentures if the option to receive solely Common
Stock in exchange for 8-1/8% debentures is oversubscribed. If more than
$15,000,000 aggregate principal amount of 8-1/8% debentures are tendered for
Common Stock, you shall promptly advise by facsimile transmission Gary L. Smith,
Chief Financial Officer of the Company (at the facsimile number (336) 370-6043)
or Neil W. Koonce, General Counsel and Secretary of the Company (at the
facsimile number (336) 379-6922), and such other person or persons as the
Company may request, of such condition. The Company will instruct you as to
whether it will increase the amount of shares to be issued, the amount of shares
of Common Stock that will be issuable in the Exchange Offer and the amount of
11% debentures that will be issuable in the Exchange Offer.
9. If more than $15,000,000 aggregate principal amount of 8-1/8%
debentures, or a greater amount up to $25,000,000 if the Company exercises its
right to increase the number of
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shares of Common Stock issuable in the Exchange Offer, are tendered in the
Exchange Offer with an election to receive shares of Common Stock and are not
withdrawn prior to the expiration of the Exchange Offer, you shall accept the
debentures so tendered for exchange for Common Stock on a pro rata basis,
rounded to the nearest $1,000 principal amount of 8-1/8% debentures, according
to the amount of 8-1/8% debentures validly tendered for Common Stock and not
withdrawn prior to the expiration of the Exchange Offer. You will exchange the
remainder of the properly tendered 8-1/8% debentures for new 11% debentures and
Common Stock.
10. If more than $85,000,000 aggregate principal amount of 8-1/8%
debentures are tendered in the Exchange Offer with an election to receive New
11% debentures and Common Stock, and are not withdrawn prior to the expiration
of the Exchange Offer, you will accept the debentures so tendered for exchange
for 11% debentures and Common Stock on a pro rata basis, rounded to the nearest
$1,000 principal amount of 8-1/8% debentures, according to the amount of 8-1/8%
debentures validly tendered for debentures and Common Stock and not withdrawn
prior to the expiration of the Exchange Offer. You will exchange the remainder
of the properly tendered 8-1/8% debentures for Common Stock.
11. The Company will exchange 8-1/8% debentures duly tendered on the
terms and subject to the conditions set forth in the Exchange Offer and the
Consent and Letter of Transmittal. The payment of the Exchange Consideration (as
defined in the Exchange Offer) for 8-1/8% debentures duly tendered and accepted
for exchange pursuant to the Exchange Offer will be made as soon as practicable
after (A) notice (such notice, if given orally, to be confirmed in writing) of
acceptance of said 8-1/8% debentures by the Company and (B) you receive the New
Securities from the Company. The issuance of such New Securities as the Exchange
Consideration will be made by you on behalf of the Company by deposit in
accordance with DTC's settlement procedures to each holder of 8-1/8% debentures
that has validly tendered (and not withdrawn) 8-1/8% debentures prior to the
Expiration Date. In all cases, the Exchange Consideration for 8-1/8% debentures
tendered and exchanged pursuant to the Exchange Offer will be issued and
delivered only after timely receipt by you of certificates for such 8-1/8%
debentures (or timely confirmation of a book-entry transfer of such 8-1/8%
debentures into your account at DTC), a properly completed and duly executed
Consent and Letter of Transmittal (or facsimile thereof) or acknowledgment and
agreement to the Agent's Message (as defined in the Exchange Offer) and any
other required documents, as set forth in the Exchange Offer.
New Securities will be deposited with you by the Company by 12:00 noon
on the business day following the Expiration Date, and you shall thereupon begin
make deposits in accordance with DTC's settlement procedures to or for the
account of holders. After such deposit by the Company, you shall promptly
present certificates for said 8-1/8% debentures, and any applicable transfer
taxes (to be paid by the Company), together with any other documents reasonably
requested by the Company including a certificate by you indicating the aggregate
principal amount of 8-1/8% debentures validly tendered (and not withdrawn) prior
to the
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Expiration Date and the aggregate principal amount of 8-1/8% debentures
with respect to which Consents were validly delivered (and not revoked) prior to
the Expiration Date, for transfer on the books of the Company, all in accordance
with written instructions from the Company and thereafter deliver the
newly-issued certificates for said 8-1/8% debentures to the Company.
12. 8-1/8% debentures tendered pursuant to the Exchange Offer may be
withdrawn only as set forth in the Exchange Offer.
13. The Company shall not be required to exchange any 8-1/8% debentures
tendered if any of the conditions set forth in the Exchange Offer are not met.
Notice of any decision by the Company not to exchange or pay Exchange
Consideration for any 8-1/8% debentures tendered shall be given (and confirmed
in writing) by the Company to you.
14. If, pursuant to the Exchange Offer, the Company does not accept and
pay Exchange Consideration for all or part of the 8-1/8% debentures
("Unexchanged Debentures") tendered, you shall as soon as practicable return
those certificates for Unexchanged Debentures (or effect appropriate book-entry
transfer), together with any related required documents and the Consents and
Letters of Transmittal relating thereto that are in your possession, to the
persons who deposited them.
15. All certificates for Unexchanged shall be forwarded by first-class
mail.
16. You are not authorized to offer to pay any concessions, commissions or
solicitation fees to any broker, dealer, bank or other persons or to engage or
utilize any person to solicit tenders.
17. As Exchange Agent hereunder you:
a. shall not be liable for any action or omission to act
unless the same constitutes your own gross negligence, willful
misconduct or bad faith, and in no event shall you be liable to a
holder of 8-1/8% debentures, the Company or any third party for
special, indirect or consequential damages, or lost profits, arising
in connection with this Agreement;
b. shall have no duties or obligations other than those
specifically set forth herein or as may be subsequently agreed to
between you and the Company;
c. will be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value or genuineness
of any of the certificates or the 8-1/8% debentures represented thereby
deposited with you pursuant to the Exchange Offer, and will not be
required to and will make no representation as to the validity, value
or genuineness of the Exchange Offer;
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d. shall not be obligated to take any legal action hereunder
which might in your judgment involve any expense or liability, unless
you shall have been furnished with indemnity satisfactory to you;
e. may rely on and shall be protected in acting in reliance
upon any certificate, instrument, opinion, notice, letter, telegram,
or other document or security delivered to you and reasonably believed
by you to be genuine and to have been signed by the proper party or
parties;
f. may act upon any tender, statement, request, certificate or
other instrument whatsoever not only as to its due execution and
validity and effectiveness of its provisions, but also as to the truth
and accuracy of any information contained therein, which you shall in
good faith believe to be genuine or to have been signed or represented
by a proper person or persons;
g. may rely on and shall be protected in acting upon written
or oral instructions from any authorized officer of the Company or any
executive director of the Company;
h. may consult with counsel of your selection with respect to
any questions relating to your duties and responsibilities or for
advice in respect to any action taken, suffered or omitted by you
hereunder; and
i. shall not advise any person tendering 8-1/8% debentures
pursuant to the Exchange Offer as to the wisdom of making such tender
or as to the market value or decline or appreciation in market value
of any Security.
18. You shall take such action as may from time to time be requested by the
Company (and such other action as you may deem appropriate) to furnish copies of
the Exchange Offer, Consent and Letter of Transmittal and the Notice of
Guaranteed Delivery to all persons requesting such documents and to accept and
comply with telephone requests for information relating to the Exchange Offer.
The Company will furnish you with copies of such documents on your request.
19. You are authorized to cooperate with and to furnish information to any
organization (and its representatives) designated from time to time by the
Company in any manner reasonably requested by it in connection with the Exchange
Offer and any tenders thereunder.
20. You shall advise by facsimile transmission Gary L. Smith, Chief
Financial Officer of the Company (at the facsimile number (336) 370-6043) or
Neil W. Koonce, General Counsel
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and Secretary of the Company (at the facsimile number (336) 379-6922), and such
other person or persons as the Company may request, daily (or more frequently
if requested) up to and including the Expiration Date, as to the principal
amount of 8-1/8% debentures that have been tendered pursuant to the Exchange
Offer, the amounts of the forms of exchange consideration that have been elected
to be received in the Exchange Offer, and the items received by you pursuant to
this Agreement, separately reporting and giving cumulative totals as to items
properly received, items improperly received and items covered by Notice of
Guaranteed Delivery referred to in paragraph (b) of paragraph 4 hereof. In
addition, you will also inform, and cooperate in making available to, the
aforementioned persons upon oral request made from time to time prior to the
Expiration Date of such other information as they may reasonably request. Such
cooperation shall include, without limitation, the granting by you to the
Company, and such other persons as the Company may request, of access to those
persons on your staff who are responsible for receiving tenders, in order to
ensure that immediately prior to the Initial Expiration Date and each other
Expiration Date, if any, the Company shall have received information in
sufficient detail to enable it to decide whether to extend the Exchange Offer.
You shall prepare a final list of all persons whose tenders were accepted, the
principal amount of 8-1/8% debentures tendered and the amount accepted and
deliver that list to Gary L. Smith, Chief Financial Officer of the Company.
21. Consents and Letters of Transmittal and Notices of Guaranteed Delivery
submitted in lieu thereof pursuant to the Exchange Offer shall be stamped by you
as to the date and time of receipt thereof and, after the expiration of the
Exchange Offer, shall be preserved by you for a period of time at least equal to
the period of time you preserve other records pertaining to the transfer of
Debentures. Printed confirmations of tenders via DTC's ATOP system received by
you on your DTC PTS printer (or, if such tenders are not confirmed by printed
transmissions, electronic confirmations of such tenders received by you on your
DTC PTS terminal) also shall be preserved by you for the period of time
specified in the preceding sentence. You shall dispose of unused Consents and
Letters of Transmittal and other surplus materials by returning them to Gary L.
Smith, Chief Financial Officer of the Company.
22. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on Schedule I attached hereto. The
provisions of this section shall survive the termination of this Agreement.
23. You hereby acknowledge receipt of the Exchange Offer and the Consent
and Letter of Transmittal. Any inconsistency between this Agreement, on the one
hand, and the Exchange Offer and the Consent and Letter of Transmittal (as they
may be amended from time to time), on the other hand, shall be resolved in favor
of the latter two documents, except with respect of the duties, liabilities and
indemnification of you as Exchange Agent. Notwithstanding anything to the
contrary herein, you will act in accordance with applicable law and as set forth
in the Exchange Offer.
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24. The Company covenants and agrees to indemnify and hold you harmless
against any loss, liability, cost or expense, including reasonable attorneys'
fees and expenses, (incurred without gross negligence, misconduct or bad faith
on your part) arising out of or in connection with any act, omission, delay or
refusal made by you in reasonable reliance upon any signature, endorsement,
assignment, certificate, order, request, notice, instruction or other instrument
or document believed by you to be valid, genuine and sufficient and in accepting
any tender or effecting any transfer of 8-1/8% debentures believed by you in
good faith to be authorized, and in delaying or refusing in good faith to accept
any tenders or affect any transfer of 8-1/8% debentures. In each case the
Company shall be notified by you, by letter or facsimile transmission, of the
written assertion of a claim against you or of any other action commenced
against you, promptly after you shall have received any such written assertion
or shall have been served with a summons in connection therewith. The Company
shall be entitled to participate at its own expense in the defense of any such
claim or other action and, if the Company so elects, the Company shall assume
the defense of any suit brought to enforce any such claim. In the event that the
Company shall assume the defense of any such suit, the Company shall not be
liable for the fees and expenses of any additional counsel thereafter retained
by you, so long as the Company shall retain counsel reasonably satisfactory to
you to defend such suit and so long as you have not determined, in your
reasonable judgment, that a conflict of interest exists between you and the
Company. The provisions of this section shall survive the termination of this
Agreement.
25. You shall arrange to comply with all requirements under the tax laws
of the United States, including those relating to missing Tax Identification
Numbers, and shall file any appropriate reports with the Internal Revenue
Service (e.g., 1099, 1099B, etc.). The Company understands that you are
required to deduct 31% on payments to holders who have not supplied their
correct Taxpayer Identification Number or required certification. Such funds
will be turned over to the Internal Revenue Service.
26. You shall deliver or cause to be delivered in a timely manner to each
governmental authority to which any transfer taxes are payable in respect of the
transfer of exchanged 8-1/8% debentures to the Company, the Company's check in
the amount of all transfer taxes so payable; provided, however, that you shall
reimburse the Company for amounts refunded to you in respect of your payment of
any such transfer taxes, at such time as such refund is received by you.
27. This Agreement and your appointment as Exchange Agent hereunder shall
be construed and enforced in accordance with the laws of the State of New York
applicable to agreements made and to be performed entirely within such state,
and shall inure to the benefit of, and the obligations created hereby shall be
binding upon, the successors and assigns of each of the parties hereto. This
Agreement may not be modified orally.
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28. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original but which together shall constitute one
and the same agreement.
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Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
CONE MILLS CORPORATION
By: _________________________________
Name: _______________________________
Title: ______________________________
Accepted as of the date first above written.
THE BANK OF NEW YORK
By: ______________________________
Name: ____________________________
Title: ___________________________
