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As filed with the Securities and Exchange Commission on July 13, 2001 Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AGCO CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 3523 58-1960019
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification Number)
Incorporation or Organization) Classification Code Number)
4205 RIVER GREEN PARKWAY
DULUTH, GEORGIA 30096
(770) 813-9200
(Address, Including Zip Code, and Telephone Number, Including
Area Code of Registrant's Principal Executive Offices)
STEPHEN D. LUPTON
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
AGCO CORPORATION
4205 RIVER GREEN PARKWAY
DULUTH, GEORGIA 30096
(770) 813-9200
(Address, Including Zip Code, and Telephone Number, Including
Area Codes of Agent For Service)
WITH A COPY TO:
W. BRINKLEY DICKERSON, JR.
TROUTMAN SANDERS LLP
BANK OF AMERICA PLAZA, SUITE 5200
600 PEACHTREE STREET NE
ATLANTA, GEORGIA 30308
(404) 885-3000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as possible after the effective date of this Registration Statement.
If the securities being registered on this Form are to be offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, please check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
CALCULATION OF REGISTRATION FEE
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM OFFERING PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PRICE PER SECURITY(1) OFFERING PRICE (1) REGISTRATION FEE (2)
--------------------------------- ------------ ------------------------- --------------------------- --------------------
9 1/2% Senior Notes due 2008 $250,000,000 100% $250,000,000 $62,500
Guarantees of the 9 1/2% Senior Notes $250,000,000 (4) (4) (4)
due 2008 (3)
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended.
(2) Pursuant to Rule 457(f)(2) of the Securities Act of 1933, as amended, the
registration fee has been estimated based on the book value of the
securities to be received by the registrant in exchange for the securities
to be issued hereunder in the exchange offer described herein.
(3) See inside facing page for table of registrant guarantors.
(4) Pursuant to Rule 457(n), no additional registration fee is required in
respect of the guarantees.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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TABLE OF ADDITIONAL REGISTRANTS
The following domestic subsidiaries of AGCO Corporation are guarantors of
the new notes and are co-registrants:
PRIMARY STANDARD
I.R.S. EMPLOYER INDUSTRY
STATE OF INCORPORATION IDENTIFICATION CLASSIFICATION CODE
NAME OF ADDITIONAL REGISTRANT OF ORGANIZATION NUMBER NUMBER
----------------------------- ---------------------- --------------- -------------------
Ag-Chem Equipment Canada, Ltd. Minnesota 41-1904930 3523
Ag-Chem Equipment Co., Inc. Delaware 41-1999471 3523
Ag-Chem Equipment International, Inc. Minnesota 66-0414993 3523
Ag-Chem Manufacturing Co., Inc. Minnesota 41-1389426 3523
Ag-Chem Sales Co., Inc. Minnesota 41-1891119 3523
AGCO Ventures LLC Delaware 58-2549363 3523
Hay & Forage Industries Kansas 48-1157966 3523
Hesston Ventures Corporation Kansas 48-1038470 3523
Lor*Al Products, Inc. Minnesota 41-1703718 3523
----------------------
C/O AGCO CORPORATION
4205 RIVER GREEN PARKWAY
DULUTH, GEORGIA 30096
(770) 813-9200
(Address, including zip code, and telephone number, including area codes for
each of the co-registrant's principal executive offices)
----------------------
STEPHEN D. LUPTON
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
AGCO CORPORATION
4205 RIVER GREEN PARKWAY
DULUTH, GEORGIA 30096
(770) 813-9200
(Address, including zip code, and telephone number, including area codes of
agent for service for each co-registrant)
----------------------
WITH A COPY TO:
W. BRINKLEY DICKERSON, JR.
TROUTMAN SANDERS LLP
BANK OF AMERICA PLAZA, SUITE 5200
600 PEACHTREE STREET NE
ATLANTA, GEORGIA 30308
(404) 885-3000
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The information in the prospectus is not complete and may be changed. We may not
sell these securities until the registration statement filed with the Securities
and Exchange Commission is effective. This prospectus is not an offer to sell
these securities and it is not soliciting an offer to buy these securities in
any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED , 2001
PROSPECTUS
AGCO CORPORATION
OFFER TO EXCHANGE
$250,000,000
9 1/2% SENIOR NOTES DUE 2008
WHICH HAS BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR $250,000,000 OUTSTANDING UNREGISTERED
9 1/2% SENIOR NOTES DUE 2008
We are offering to exchange $250,000,000 aggregate principal amount of
registered 9 1/2% senior notes due 2008, which we refer to as the new notes, for
$250,000,000 aggregate principal amount of unregistered 9 1/2% senior notes due
2008, which we refer to as the old notes. The terms of the new notes are
identical in all material respects to the terms of the old notes except that the
new notes have been registered under the Securities Act of 1933 and, therefore,
the transfer restrictions applicable to the old notes are not applicable to the
new notes.
- Our offer to exchange old notes for new notes will be open until 5:00
p.m., New York City time, on , 2001, unless we extend the
offer.
- We will exchange all outstanding old notes that are validly tendered
and not validly withdrawn prior to the expiration date of the exchange
offer. You should carefully review the procedures for tendering the old
notes beginning on page 15 of this prospectus.
- If you fail to tender your old notes, you will continue to hold
unregistered securities and your ability to transfer them could be
adversely affected.
- The exchange of old notes for new notes pursuant to the exchange offer
generally will not be a taxable event for U.S. federal income tax
purposes.
- We will not receive any proceeds from the exchange offer.
- No public market currently exists for the notes. We do not intend to
list the new notes on any securities exchange and, therefore, no active
public market is anticipated.
- Each broker-dealer that receives new notes for its own account in this
exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of such new notes. The letter of transmittal
to be used in connection with this exchange offer states that by so
acknowledging and by delivering a prospectus, a broker-dealer will not
be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act of 1933. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in
connection with resales of new notes received in exchange for old notes
where such old notes were acquired by such broker-dealer as a result of
market-making activities or other trading activities. We have agreed
that, for a period of 180 days after the expiration date, we will make
this prospectus available to any broker- dealer for use in connection
with any such resale. See "Plan of Distribution" starting on page 58 of
this prospectus.
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INVESTING IN THE NEW NOTES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING
ON PAGE 8 OF THIS PROSPECTUS FOR A DISCUSSION OF CERTAIN FACTORS THAT YOU SHOULD
CONSIDER IN CONNECTION WITH AN INVESTMENT IN THE NEW NOTES.
-----------------------------
NEITHER THE SECURITIES EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is , 2001.
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-----------------------------
TABLE OF CONTENTS
PAGE
----
WHERE YOU CAN FIND MORE INFORMATION...................... ii
FORWARD-LOOKING STATEMENTS............................... iv
SUMMARY.................................................. 1
RISK FACTORS............................................. 8
USE OF PROCEEDS.......................................... 14
THE EXCHANGE OFFER....................................... 15
DESCRIPTION OF THE NEW NOTES............................. 24
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES............ 55
PLAN OF DISTRIBUTION..................................... 58
LEGAL MATTERS............................................ 59
EXPERTS.................................................. 59
-----------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED IN
THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT OR
ADDITIONAL INFORMATION. IF ANYONE PROVIDES YOU WITH DIFFERENT OR ADDITIONAL
INFORMATION, YOU SHOULD NOT RELY ON IT. YOU SHOULD ASSUME THAT THE INFORMATION
CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS IS ACCURATE AS OF THE
DATE ON THE FRONT COVER OF THIS PROSPECTUS OR THE DATE OF THE DOCUMENT
INCORPORATED BY REFERENCE. OUR BUSINESS, FINANCIAL CONDITION, RESULTS OF
OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE THEN. WE ARE NOT MAKING AN OFFER
TO SELL THE SECURITIES OFFERED BY THIS PROSPECTUS IN ANY JURISDICTION WHERE THE
OFFER OR SALE IS NOT PERMITTED.
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WHERE YOU CAN FIND MORE INFORMATION
The SEC allows us to "incorporate by reference" the information we file
with it, which means that we disclose important information to you by referring
to those documents. This prospectus incorporates the following documents by
reference to the following SEC filings:
For AGCO, these documents include:
- Annual Report on Form 10-K for the year ended
December 31, 2000 dated April 2, 2001.
- Current Report on Form 8-K dated April 2, 2001.
- Current Report on Form 8-K dated April 3, 2001.
- Definitive Proxy Statement dated April 4, 2001.
- Current Report on Form 8-K dated April 11, 2001.
- Current Report on Form 8-K dated April 16, 2001.
- Quarterly Report on Form 10-Q dated May 15, 2001.
- Current Report on Form 8-K dated July 12, 2001.
- Quarterly Report on Form 10-Q dated August , 2001.
For Ag-Chem Equipment Co., Inc., a company acquired by us on April 16,
2001, these documents include:
- Current Report on Form 8-K dated April 2, 2001.
All documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this prospectus and before termination of
the offering are incorporated by reference into and are made a part of this
prospectus from the date of filing of those documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference into this prospectus will be deemed to be modified or
superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus or any other subsequently filed document that is
deemed to be incorporated by reference into this prospectus modifies or
supersedes that statement. Any statement so modified or superseded will not be
deemed, except as so modified or superseded, to constitute a part of this
prospectus.
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS OR
THAT WE HAVE REFERRED YOU TO. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT.
In addition, we will provide, without charge, to each person to whom
this prospectus is delivered, upon written or oral request, a copy of any or all
of the foregoing documents (other than exhibits to documents that are not
specifically incorporated by reference in the documents). Please direct such
requests to AGCO Corporation, 4205 River Green Parkway, Duluth, Georgia, 30096,
Attn: Secretary, (770) 813-9200.
IF YOU WOULD LIKE TO REQUEST DOCUMENTS, YOU MUST DO SO BY NO LATER THAN
FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION OF THE EXCHANGE OFFER. THE EXCHANGE
OFFER WILL EXPIRE ON , 2001.
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This prospectus is a part of a registration statement filed by us with
the SEC under the Securities Act. As permitted by the rules and regulations of
the SEC, this prospectus does not contain all of the information contained in
the registration statement. For further information about us and about the
notes, you should consult the registration statement, including the exhibits and
schedules. You should be aware that statements contained in this prospectus
concerning the provisions of any documents filed as an exhibit to the
registration statement or otherwise filed with the SEC are not necessarily
complete, and therefore you should review the full text of these documents.
We file reports, proxy statements and other information with the SEC.
Copies of our reports, proxy statements and other information may be inspected
and copied at the public reference facilities maintained by the SEC at:
Judiciary Plaza Citicorp Center Seven World Trade Center
Room 1024 500 West Madison Street 13th Floor
450 Fifth Street, NW Suite 1400 New York, NY 10048
Washington, D.C. 20549 Chicago, Illinois 60661
These documents are also available for viewing and copying at the
offices of the New York Stock Exchange at 20 Broad Street, New York, New York
10005.
Reports, proxy statements and other information concerning Ag-Chem may
be inspected at:
The National Association of Securities Dealers
1735 K Street, N.W.
Washington, D.C. 20006
Copies of our reports, proxy statements and other information and
Ag-Chem's reports, proxy statements and other information may be obtained by
calling the SEC at 1-800-SEC-0330. The SEC maintains a Website that contains
reports, proxy statements and other information regarding AGCO. The address of
the SEC Website is http://www.sec.gov.
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FORWARD-LOOKING STATEMENTS
This prospectus contains numerous forward-looking statements about the
financial condition, results of operations, cash flows, dividends, financing
plans, business strategies, operating efficiencies or capital and other
expenditures, competitive positions, growth opportunities for existing products,
plans and objectives of management, markets for our stock and debt securities
and other matters. The words "estimate," "project," "intend," "expect,"
"believe," "forecast" or similar expressions, or the negative of these terms or
expressions, are intended to identify these forward-looking statements, but some
of these statements use other phrasing. In addition, any statement in this
prospectus that is not a historical fact is a "forward-looking statement."
Except as required by law, we expressly disclaim any obligation to publicly
release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this prospectus or to reflect the occurrence of
unanticipated events. Such forward-looking statements, wherever they occur in
this prospectus, are necessarily estimates reflecting the best judgment of our
senior management and involve a number of risks and uncertainties that could
cause actual results to differ materially from those suggested by the
forward-looking statements. In addition to the specific risk factors described
in the section entitled "Risk Factors," important factors that could cause
actual results to differ materially from those suggested by the forward-looking
statements include, but are not limited to:
- general economic and capital market conditions;
- the demand for agricultural products;
- the levels of new and used field inventories;
- weather conditions;
- interest and foreign currency exchange rates;
- the conversion to the Euro;
- pricing and product actions taken by competitors;
- customer access to credit;
- production disruptions;
- supply and capacity constraints;
- our cost reduction and control initiatives;
- our research and development efforts;
- dealer and distributor actions;
- technological difficulties; and
- political and economic uncertainty in various areas of the
world.
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SUMMARY
This summary highlights all material information from the prospectus.
It may not contain all of the information that is important to you. For a more
complete understanding of this exchange offer, you should read this entire
prospectus and the other documents to which it refers to fully understand the
terms of the new notes and the exchange offer. As used in this prospectus, the
terms "we," "us," "AGCO" and "our company" refer to AGCO Corporation.
AGCO CORPORATION
We manufacture and distribute agricultural equipment and related
replacement parts throughout the world. We sell a full range of agricultural
equipment, including tractors, combines, hay tools, self-propelled sprayers,
forage equipment and implements. Our products are widely recognized in the
agricultural equipment industry and are marketed under the following brand
names: AGCO(R), AGCO(R) Allis, Fendt, Massey Ferguson(R), Hesston(R), White,
GLEANER(R), New Idea(R), AGCOSTAR(R), Tye(R), Farmhand(R), Glencoe(R),
Spra-Coupe(R) and Willmar(R). We distribute our products through a combination
of approximately 7,750 independent dealers and distributors, associates and
licensees. In addition, we provide retail financing in North America, the United
Kingdom, France, Germany, Spain, Ireland and Brazil through our finance joint
ventures with Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A.
ACQUISITION OF AG-CHEM
On April 16, 2001, we acquired Ag-Chem Equipment Co., Inc., which we
refer to as Ag-Chem, for approximately $247 million in stock and cash. Ag-Chem
manufactures and distributes off-road equipment primarily for use in fertilizing
agricultural crops, applying crop protection chemicals, and to a lesser extent,
for industrial waste treatment applications and other industrial uses. Ag-Chem
generates a majority of its consolidated revenues from the sale of
self-propelled, three- and four-wheeled vehicles and related equipment for use
in the application of liquid and dry fertilizers and crop protection chemicals.
The acquisition of Ag-Chem provides us with the opportunity to become the
leading manufacturer and distributor of self-propelled fertilizer and chemical
sprayers for pre-emergent and post-emergent applications.
SUMMARY OF THE TERMS OF THE EXCHANGE OFFER
On April 17, 2001, we completed an offering of $250 million principal
amount of 9 1/2% senior notes due 2008 that was exempt from the registration
requirements of the Securities Act of 1933. In connection with that private
offering, we entered into a registration rights agreement with the initial
purchasers of the original notes in which we agreed, among other things, to
deliver this prospectus to you and to use our commercially reasonable efforts to
complete this exchange offer by September 14, 2001.
The exchange offer................. We are offering to exchange $1,000 principal
amount of our registered 9 1/2% senior notes
due 2008, which we refer to as the new
notes, for each outstanding $1,000 principal
amount of our unregistered 9 1/2% senior
notes due 2008, which we refer to as the old
notes.
The terms of the new notes are identical in
all material respects to the terms of the
old notes except that:
- the new notes have been registered
under the federal securities laws
and, therefore, the transfer
restrictions applicable to the old
notes are not applicable to the new
notes and the new notes will not
bear any legend restricting their
transfer; and
- the holders of the new notes will
not be entitled to certain rights
under the registration rights
agreement, including the provisions
for an increase in the interest
rate on the outstanding notes in
some circumstances relating to the
timing of the exchange offer.
We sometimes refer to the new notes and the
old notes together as the "notes." As of the
date of this prospectus, $250 million
principal amount of old notes are
outstanding.
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If you wish to exchange an old note, you
must properly tender it in accordance with
the terms described in this prospectus. Old
notes may be tendered only in $1,000
increments. We will exchange all old notes
that are validly tendered and are not
validly withdrawn and will cause the
exchange to be effected promptly after the
expiration of the exchange offer. See "The
Exchange Offer -- Terms of the Exchange
Offer."
Upon completion of the exchange offer, there
may be no market for the old notes and you
may have difficulty selling them. See "Risk
Factors -- If an active trading market does
not develop for the new notes, you may be
unable to sell the new notes or to sell them
at a price you deem sufficient."
Registration rights agreement.... We are making this exchange offer in order
to satisfy our obligation under the
registration rights agreement, entered into
on April 11, 2001, to cause our registration
statement to become effective under the
Securities Act. You are entitled to exchange
your old notes for new notes with
substantially identical terms. After this
exchange offer is complete, you will
generally no longer be entitled to any
registration rights with respect to your
notes.
Expiration date.................. The exchange offer will expire at 5:00 p.m.,
New York City time, on , 2001,
unless we extend the exchange offer.
Procedures for tendering old
notes........................... If you wish to participate in the exchange
offer, you must either:
- complete, sign and date an original
or faxed letter of transmittal in
accordance with the instructions in
the letter of transmittal
accompanying this prospectus; or
- arrange for The Depository Trust
Company to transmit required
information to the exchange agent
in connection with a book-entry
transfer.
Then you must mail, fax or deliver all
required documentation to SunTrust Bank,
which is acting as the exchange agent for
the exchange offer. The exchange agent's
address appears on the letter of
transmittal. By tendering your old notes in
either of these matters, you will represent
to and agree with us that:
- you are acquiring the new notes in
the ordinary course of your
business;
- you are not engaged in, and you do
not intend to engage in, the
distribution (within the meaning of
the federal securities laws) of the
new notes;
- you have no arrangement or
understanding with anyone to
participate in a distribution of
the new notes; and
- you are not an "affiliate," as
defined in Rule 405 under the
Securities Act, of AGCO.
See "The Exchange Offer -- Procedures for
Tendering."
If you are a broker-dealer that will receive
new notes for your own account in exchange
for old notes that you acquired as a result
of your market-making or other trading
activities, you will be required to
acknowledge in the letter of transmittal
that you will deliver a prospectus in
connection with any resale of these new
notes.
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Special procedures for beneficial
owners............................. If you are a beneficial owner of old notes
that are held by or registered in the name
of a broker, dealer, commercial bank, trust
company or other nominee or custodian and
you wish to tender your old notes, you
should contact your intermediary entity
promptly and instruct it to tender the old
notes on your behalf.
Guaranteed delivery procedures..... If you desire to tender old notes in this
exchange offer and:
- the old notes are not immediately
available;
- time will not permit delivery of
the old notes and all required
documents to the exchange agent on
or prior to the expiration date; or
- the procedures for book-entry
transfer cannot be completed on a
timely basis,
you may nevertheless tender the old notes,
provided that you comply with all of the
guaranteed delivery procedures set forth in
"The Exchange Offer -- Guaranteed Delivery
Procedures."
Resale of new notes................ Based on an interpretation by the staff
of the SEC set forth in no-action letters
issued to third parties, we believe that you
can resell and transfer your new notes
without compliance with the registration and
prospectus delivery requirements of the
Securities Act, if you can make the
representations that appear above under the
heading "--Procedures for tendering old
notes."
We cannot guarantee that the SEC would make
a similar decision about this exchange
offer. If our belief is wrong, or if you
cannot truthfully make the representations
appearing above, and you transfer any new
note without delivering a prospectus meeting
the requirements of the Securities Act or
without an exemption from registration of
your new notes from such requirements, you
may incur liability under the Securities
Act. We are not indemnifying you against
this liability.
Accrued interest on the new notes
and old notes...................... The new notes will bear interest from the
most recent date to which interest has been
paid on the old notes. If your old notes are
accepted for exchange, then you will receive
interest on the new notes and not on the old
notes.
Conditions to this exchange offer.. This exchange offer is not subject to any
conditions other than that it does not
violate applicable law or any applicable
interpretation of the SEC. We are not
conditioning the exchange offer on the
tender of any minimum principal amount of
old notes.
Withdrawal rights.................. You may withdraw the tender of your old
notes at any time prior to the expiration
date.
Appraisal rights................... You will not be entitled to any appraisal
or dissenters' rights nor any other right to
seek monetary damages in court in connection
with the exchange offer. See "The Exchange
Offer -- Terms of the Exchange Offer."
U.S. federal income tax
consequences....................... The exchange of notes will not constitute a
taxable exchange for U.S. federal income tax
purposes. For a discussion of other U.S.
federal income tax consequences resulting
from the exchange, ownership and disposition
of the new notes, see "Material U.S. Federal
Income Tax Consequences."
Use of proceeds.................... We will not receive any proceeds from the
issuance of new notes in this exchange
offer. We will pay all registration expenses
incident to the exchange offer.
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Exchange agent..................... SunTrust Bank is serving as exchange agent
in connection with this exchange offer.
SunTrust Bank also serves as trustee under
the indenture that governs the notes.
SUMMARY OF THE TERMS OF THE NEW NOTES
The following is a summary of the terms of the new notes. The terms of
the new notes are the same in all material respects to the terms of the old
notes, except that the new notes will be registered under the Securities Act
and, therefore, the transfer restrictions applicable to the old notes will not
be applicable to the new notes and will not bear any legends restricting their
transfer. In addition, the new notes generally will not be entitled to
registration under the Securities Act. The new notes will evidence the same debt
as the old notes and both the old notes and the new notes are governed by the
same indenture. Both the old notes and the new notes will be treated as a single
class of notes should any old notes remain outstanding following this exchange
offer.
Issuer............................. AGCO Corporation.
Notes offered...................... $250,000,000 aggregate principal amount
of 9 1/2% senior notes due 2008.
Maturity date...................... May 1, 2008.
Interest payment dates............. May 1 and November 1 of each year,
commencing November 1, 2001.
Guarantees......................... Our domestic subsidiaries existing on
April 17, 2001, other than Massey Ferguson
Corp., AGCO Funding Corporation and AGCO
Acceptance Corporation, will guarantee the
notes on an unsecured basis. The subsidiary
guarantees will rank pari passu in right of
payment to all existing and future unsecured
senior indebtedness of the guarantors. If we
acquire or invest in additional domestic
operating subsidiaries in the future, those
subsidiaries generally will not be required
to guarantee the notes.
Optional redemption.............. On or after May 1, 2005, we may redeem the
notes, in whole or in part, initially at
104.75% of their principal amount, plus
accrued interest, declining to 100% of their
principal amount, plus accrued interest, on
or after May 1, 2007.
Change of control................ If a change of control of our company
occurs, we will be required to make an offer
to purchase the notes at a purchase price
equal to 101% of their principal amount,
plus accrued interest to the date of
repurchase.
Ranking.......................... The notes will be general, unsecured senior
obligations and will rank pari passu in
right of payment to all of our existing and
future senior indebtedness. However, the
notes will be effectively subordinated to
our secured indebtedness, including
borrowings under our revolving credit
facility, and to indebtedness of our
non-guarantor subsidiaries. As of June 30,
2001, we had $ million of secured
indebtedness under our revolving credit
facility and our non-guarantor subsidiaries
had liabilities, including trade payables
but excluding borrowings under the revolving
credit facility, of $ million. The notes
will rank senior in right of payment to any
existing and future subordinated
indebtedness, including our 8 1/2% senior
subordinated notes due 2006.
Restrictive Covenants............ The indenture governing the notes contains
covenants that limit our ability and that of
our restricted subsidiaries to, among other
things:
- incur additional indebtedness;
- pay dividends or make distributions
or certain other restricted
payments;
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- make certain investments;
- create dividend or other payment
restrictions affecting restricted
subsidiaries;
- guarantee indebtedness;
- enter into transactions with
stockholders or affiliates;
- create liens;
- sell assets;
- engage in sale-leaseback
transactions; and
- enter into certain mergers and
consolidations.
These covenants are subject to a number of
important exceptions and qualifications.
RISK FACTORS
Investing in the notes involves significant risks. You should carefully
consider the specific risk factors described in "Risk Factors" before investing
in the new notes.
ADDITIONAL INFORMATION
We were incorporated in Delaware in April 1991. Our executive offices
are located at 4205 River Green Parkway, Duluth, Georgia 30096, and our
telephone number is (770) 813-9200.
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
Set forth below are our selected historical consolidated financial
data. We derived our historical consolidated statements of operations data for
the quarters ended March 31, 2001 and March 31, 2000 and the balance sheet data
as of March 31, 2001 from our unaudited consolidated financial statements. Our
historical consolidated statements of operations and balance sheet data for the
fiscal years ended December 31, 2000, 1999, 1998, 1997 and 1996 are derived from
our audited consolidated financial statements, which were audited by Arthur
Andersen, LLP, independent public accountants. The data set forth below should
be read together with "Management's Discussion and Analysis of Financial
Condition and Results of Operations" as filed in our Annual Report on Form 10-K
filed with the SEC on April 2, 2001, and our historical consolidated financial
statements and accompanying notes. The historical financial data may not be
indicative of our future performance. Amounts in millions, except ratio data.
QUARTER ENDED MARCH 31,
-----------------------
2001 2000
------- -------
(UNAUDITED)
OPERATING DATA:
Net sales ................................................. $ 532.1 $ 534.8
Cost of goods sold ........................................ 449.6 457.7
------- -------
Gross profit ....................................... 82.5 77.1
Selling, general and administrative expenses .............. 56.7 58.9
Engineering expenses ...................................... 11.9 10.5
Restructuring and other infrequent expenses ............... 2.3 1.9
Amortization of intangibles ............................... 3.9 3.8
------- -------
Income from operations ............................. 7.7 2.0
Interest expense, net ..................................... 13.9 11.4
Other expense, net ........................................ 7.6 12.3
------- -------
Income (loss) before income taxes, equity in
net earnings of affiliates and extraordinary loss ... (13.8) (21.7)
Income tax provision (benefit) ............................ (5.2) (8.7)
------- -------
Income (loss) before equity in net earnings
of affiliates and extraordinary loss .................... (8.6) (13.0)
Equity in net earnings of affiliates ...................... 2.8 2.3
------- -------
Income (loss) before extraordinary loss ............ $ (5.8) $ (10.7)
======= =======
OTHER FINANCIAL DATA:
Depreciation and amortization ............................. $ 17.0 $ 19.0
Capital expenditures ...................................... 4.5 7.5
Interest expense, gross ................................... 17.0 14.4
Dividends received from affiliates ........................ -- --
EBITDA, as adjusted (2) ................................... 22.9 20.7
Ratio of earnings to fixed charges(3) ..................... -- --
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
2000 1999 1998 1997 1996
--------- --------- -------- -------- --------
OPERATING DATA:
Net sales ................................................. $ 2,336.1 $ 2,436.4 $2,970.8 $3,253.9 $2,342.7
Cost of goods sold ........................................ 1,959.5 2,078.7 2,431.5 2,585.5 1,872.7
--------- --------- -------- -------- --------
Gross profit ....................................... 376.6 357.7 539.3 668.4 470.0
Selling, general and administrative expenses .............. 228.2 233.2 274.3 280.1 212.7
Engineering expenses ...................................... 45.6 44.6 56.1 54.1 27.7
Restructuring and other infrequent expenses ............... 21.9 24.5 40.0 18.2 22.3
Amortization of intangibles ............................... 15.1 14.8 13.2 12.1 5.8
--------- --------- -------- -------- --------
Income from operations ............................. 65.8 40.6 155.7 303.9 201.5
Interest expense, net ..................................... 46.6 57.6 67.7 53.5 32.7
Other expense, net ........................................ 33.1 15.2 13.7 4.7 (2.8)
--------- --------- -------- -------- --------
Income (loss) before income taxes, equity in
net earnings of affiliates and extraordinary loss ... (13.9) (32.2) 74.3 245.7 171.6
Income tax provision (benefit) ............................ (7.6) (10.2) 27.5 87.5 59.9
--------- --------- -------- -------- --------
Income (loss) before equity in net earnings
of affiliates and extraordinary loss .................... (6.3) (22.0) 46.8 158.2 111.7
Equity in net earnings of affiliates ...................... 9.8 10.5 13.8 12.6 17.7
--------- --------- -------- -------- --------
Income (loss) before extraordinary loss ............ $ 3.5 $ (11.5) $ 60.6 $ 170.8(1) $ 129.4(1)
========= ========= ======== ======== ========
OTHER FINANCIAL DATA:
Depreciation and amortization ............................. $ 69.7 $ 76.8 $ 79.7 $ 72.0 $ 53.5
Capital expenditures ...................................... 57.7 44.2 61.0 72.1 45.2
Interest expense, gross ................................... 60.3 71.4 81.5 70.7 46.5
Dividends received from affiliates ........................ 9.7 12.9 10.5 -- --
EBITDA, as adjusted (2) ................................... 154.8 158.4 286.0 406.6 293.9
Ratio of earnings to fixed charges(3) ..................... -- -- 1.9x 4.2x 4.2x
AS OF DECEMBER 31,
AS OF MARCH 31, ----------------------------------------------------------------
2001 2000 1999 1998 1997 1996
--------------- -------- -------- -------- -------- --------
(UNAUDITED)
BALANCE SHEET DATA:
Cash and cash equivalents .. $ 5.4 $ 13.3 $ 19.6 $ 15.9 $ 31.2 $ 41.7
Working capital ........... 654.1 603.9 764.0 1,029.9 884.3 750.5
Total assets ............... 2,093.4 2,104.2 2,273.2 2,750.4 2,620.9 2,116.5
Long-term debt ............. 645.8 570.2 691.7 924.2 727.4 567.1
Stockholders' equity ....... 742.6 789.9 829.1 982.1 991.6 774.6
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(1) Amounts for the years ended December 31, 1997 and 1996 exclude
extraordinary losses, net of taxes, for the write-off of unamortized
debt costs related to the refinancing of our revolving credit facility
of $2.1 million in 1997 and $3.5 million in 1996.
(2) EBITDA, as adjusted, is defined as income (loss) before
taxes, equity in net earnings of affiliates and extraordinary loss,
plus restructuring and other infrequent expenses, certain one-time
charges, interest expense (gross), dividends received from affiliates
and depreciation and amortization. The one-time charges include a $5.0
million write-down of production inventory related to the closure of
manufacturing facilities in 1999, a $7.1 million expense related to the
initial funding of the U.S. securitization facility in the quarter
ended March 31, 2000 and fiscal year 2000 and a $0.4 million expense
related to a $35.0 million increase in funding under the U.S.
securitization facility in the quarter ended March 31, 2001. EBITDA, as
adjusted, is presented to provide additional information related to our
ability to service indebtedness. EBITDA, as adjusted, should not be
considered as an alternative to net income, as a measure of our
operating results, or to cash flow, as a measure of our liquidity.
(3) For purposes of computing the ratio of earnings to fixed charges,
earnings consist of income (loss) before income taxes, equity in net
earnings of affiliates and extraordinary loss plus dividends received
from affiliates and fixed charges. Fixed charges consist of interest
costs, including amortization of debt costs, and an estimate of the
interest cost in rental expense. The deficiency of the earnings to
fixed charges was $13.8 million and $21.7 million for the quarters
ended March 31, 2001 and March 31, 2000, respectively, and $4.2 million
and $19.3 million for the twelve months ended December 31, 2000 and
1999, respectively.
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RISK FACTORS
You should read and carefully consider the risks described in this
section, as well as the other information contained in or incorporated by
reference in this prospectus, before making a decision to tender your old notes
in exchange for new notes in this exchange offer.
RISKS RELATED TO OUR INDEBTEDNESS
OUR SUBSTANTIAL INDEBTEDNESS COULD ADVERSELY AFFECT OUR ABILITY TO PERFORM OUR
OBLIGATIONS UNDER THE NOTES.
We have now and will continue to have a significant amount of
indebtedness. As of June 30, 2001, we have a total indebtedness of approximately
$ million, stockholders' equity of $ million, and a ratio of debt to
equity of [ to ].
Our substantial indebtedness could have important consequences to you.
For example, it could:
- make it more difficult for us to satisfy our obligations with
respect to the notes;
- require us to dedicate a substantial portion of our cash flow
from operations to payments on our indebtedness, which would
reduce the availability of our cash flow to fund future
working capital, capital expenditures, acquisitions and other
general corporate purposes;
- increase our vulnerability to general adverse economic and
industry conditions;
- limit our flexibility in planning for, or reacting to, changes
in our business and the industry in which we operate;
- restrict us from making strategic acquisitions, including
introducing new products or pursuing business opportunities;
- place us at a competitive disadvantage compared to our
competitors that have relatively less indebtedness; and
- limit, along with the financial and other restrictive
covenants in our indebtedness, among other things, our ability
to borrow additional funds or pay cash dividends. Failing to
comply with those covenants could result in an event of
default which, if not cured or waived, could have a material
adverse effect on our business, financial condition and
results of operations.
DESPITE CURRENT INDEBTEDNESS LEVELS, WE AND OUR SUBSIDIARIES MAY STILL INCUR
SUBSTANTIALLY MORE INDEBTEDNESS, INCLUDING SECURED INDEBTEDNESS. INCURRING MORE
INDEBTEDNESS COULD INTENSIFY THE RISKS DESCRIBED ABOVE.
Subject to the restrictions in our revolving credit facility, the
indenture governing our 8 1/2% senior subordinated notes and the indenture
governing the notes, we may incur significant additional indebtedness. Although
the terms of the indenture governing the notes, the indenture governing our
outstanding 8 1/2% senior subordinated notes and our revolving credit facility
contain restrictions on the incurrence of additional indebtedness, these
restrictions are subject to a number of qualifications and exceptions, and
indebtedness incurred in compliance with these restrictions could be
substantial. The indenture governing the notes permits us to create liens on our
current or after-acquired assets to secure certain indebtedness, including our
revolving credit facility. Our revolving credit facility is secured by a
majority of our assets, including a portion of the capital stock of certain
foreign subsidiaries. Accordingly, any borrowings under our revolving credit
facility or other secured indebtedness would be effectively senior to the notes
and the guarantees of the notes. In the event of our liquidation or insolvency,
or if any of our secured indebtedness is accelerated, the secured assets will be
available to pay obligations on the notes only after the secured indebtedness
has been paid in full. Accordingly, there may not be sufficient assets remaining
to pay amounts due on any or all of the notes then outstanding. In addition,
borrowings of our restricted subsidiaries that do not guarantee the notes,
whether secured or not, will be effectively senior to the notes. As of June 30,
2001, we had approximately $ million of secured indebtedness under our
revolving credit facility and $ million of additional permitted borrowings
under our revolving credit facility. In addition, as of June 30, 2001, our
non-guarantor restricted subsidiaries' liabilities (other than borrowings under
the revolving credit facility) were $ million. If new debt is added to our
and our subsidiaries' current debt levels, the related risks that we and they
now face could intensify.
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OUR ABILITY TO GENERATE CASH DEPENDS ON MANY FACTORS BEYOND OUR CONTROL, AND WE
MAY NOT BE ABLE TO GENERATE THE CASH REQUIRED TO SERVICE OUR INDEBTEDNESS.
Our historical financial results have been, and our future financial
results are expected to be, subject to substantial fluctuations. We cannot
assure you that our business will generate sufficient cash flow from operations,
that currently anticipated revenue growth and operating improvements will be
realized or that future borrowings will be available to us under our revolving
credit facility in amounts sufficient to enable us to pay our indebtedness,
including the notes, or to fund our other liquidity needs. If we are unable to
meet our debt service obligations or fund other liquidity needs, we may need to
refinance all or a portion of our indebtedness, including the notes, on or
before maturity or seek additional equity capital. Our ability to pay or to
refinance our indebtedness, including the notes, will depend upon our future
operating performance, which will be affected by general economic, financial,
competitive, legislative, regulatory and other factors that are beyond our
control. We cannot assure you that we will be able to pay or refinance our
indebtedness on commercially reasonable terms, or at all.
RESTRICTIVE COVENANTS IN OUR DEBT INSTRUMENTS RESTRICT OR PROHIBIT OUR ABILITY
TO ENGAGE IN OR ENTER INTO A VARIETY OF TRANSACTIONS, WHICH COULD ADVERSELY
AFFECT US.
The indenture governing the notes will contain various covenants that
limit, among other things, our ability to:
- incur additional indebtedness;
- pay dividends or make distributions or certain other
restricted payments;
- make certain investments;
- create dividend or other payment restrictions affecting
restricted subsidiaries;
- issue or sell capital stock of restricted subsidiaries;
- guarantee indebtedness;
- enter into transactions with stockholders or affiliates;
- create liens;
- sell assets;
- engage in sale-leaseback transactions; and
- enter into certain mergers and consolidations.
The indenture for the 8 1/2% senior subordinated notes and our
revolving credit facility contain similar and additional restrictive covenants.
The covenants could have an adverse effect on our business by limiting our
ability to take advantage of financing, merger and acquisition or other
corporate opportunities and to fund our operations.
A BREACH OF A COVENANT IN OUR DEBT INSTRUMENTS COULD CAUSE ACCELERATION OF A
SIGNIFICANT PORTION OF OUR OUTSTANDING INDEBTEDNESS.
A breach of a covenant or other provision in any debt instrument
governing our current or future indebtedness could result in a default under
such instruments. In addition, our revolving credit facility requires us to
maintain certain financial ratios, which become more restrictive over the life
of the facility. Our ability to comply with these covenants may be affected by
events beyond our control, and we cannot assure you that we will be able to
comply with these covenants. Upon the occurrence of an event of default under
the revolving credit facility or any other debt instrument, the lenders could
elect to declare all amounts outstanding to be immediately due and payable and
terminate all commitments to extend further credit. If we were unable to repay
those
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amounts, the lenders could proceed against the collateral granted to them, if
any, to secure the indebtedness. If the lenders under our current or future
indebtedness accelerate the payment of the indebtedness, we cannot assure you
that our assets would be sufficient to repay in full our outstanding
indebtedness, including the notes.
THE SUBSIDIARY GUARANTORS HAVE LIMITED ASSETS, AND FUTURE DOMESTIC OPERATING
SUBSIDIARIES GENERALLY WILL NOT BE OBLIGATED TO EXECUTE SUBSIDIARY GUARANTEES.
ACCORDINGLY, THE SUBSIDIARY GUARANTEES MAY NOT PROVIDE YOU WITH SUFFICIENT
PROTECTION.
Our domestic subsidiaries existing on April 17, 2001, other than Massey
Ferguson Corp., AGCO Funding Corporation and AGCO Acceptance Corporation, are
guarantors of the notes. As of June 30, 2001, the subsidiary guarantors had
aggregate assets of approximately $____ million and our non-guarantor
subsidiaries had aggregate assets of approximately $____ million. In the future,
if we acquire or invest in additional domestic operating subsidiaries, those
subsidiaries generally will not be required to guarantee the notes. Accordingly,
the subsidiary guarantees may not provide sufficient funds to pay the notes in
full if claims are made against the subsidiary guarantors.
FRAUDULENT CONVEYANCE LAWS MAY PERMIT COURTS TO VOID GUARANTEES OF THE NOTES IN
SPECIFIC CIRCUMSTANCES.
Federal and state statutes may allow courts, under specific
circumstances, to void the guarantees of the notes. These courts could require
you to return payments received from the subsidiary guarantors in the event of
the subsidiary guarantors' bankruptcy or other financial difficulty. Under the
federal bankruptcy law and comparable provisions of state fraudulent transfer
laws, a guarantee of the notes could be voided, or claims in respect of a
guarantee could be subordinated to all other indebtedness of any subsidiary that
is the guarantor if, among other things, at the time the subsidiary guarantor
incurred the debt evidenced by its guarantee, the subsidiary guarantor:
- received less than reasonably equivalent value or fair
consideration for the incurrence of such guarantee, and
- was insolvent or was rendered insolvent by reason of
such incurrence;
- was engaged in a business or transaction for which
the subsidiary guarantor's remaining assets
constituted unreasonably small capital; or
- intended to incur, or believed (or reasonably should
have believed) that it would incur, debts beyond its
ability to pay such debts as they mature.
In addition, any payment by that subsidiary guarantor pursuant to its
guarantee could be voided and required to be returned to the subsidiary
guarantor, or to a fund for the benefit of the creditors of the subsidiary
guarantor.
The measure of insolvency for purposes of these fraudulent transfer
laws will vary depending upon the law applied in any proceeding to determine
whether a fraudulent transfer has occurred. Generally, however, a guarantor of
the notes would be considered insolvent if:
- the sum of its debts, including contingent
liabilities, were greater than the fair saleable
value of all of its assets;
- the present fair saleable value of its assets were
less than the amount that would be required to pay
its probable liability on its existing debts,
including contingent liabilities, as they become
absolute and matured; or
- it could not pay its debts as they become due.
A court is likely to find that a guarantor of the notes did not receive
fair consideration or reasonably equivalent value for its guarantee to the
extent that its liability under the guarantee is greater than the direct benefit
it received from the issuance of notes. By its terms, each guarantee of the
notes will limit the liability of the guarantor to the maximum amount that it
can pay without the guarantee being deemed a fraudulent transfer. A court may
not give effect to this limitation on liability. In that event, a court may find
that the issuance of the guarantee rendered the subsidiary guarantor insolvent.
If a court voids the guarantee or holds it unenforceable, you will cease to have
a claim against the subsidiary guarantor and will be a creditor solely of us and
the other
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subsidiary guarantors. If the limitation on liability is effective, the amount
that the subsidiary guarantor is found to have guaranteed might be so low that
there will not be sufficient funds to pay the notes in full.
On the basis of historical financial information, recent operating
results and other factors, we believe that none of the subsidiary guarantors
will be insolvent, will have unreasonably small capital for the business in
which it operates or will have incurred debts beyond its ability to pay such
debts as they mature, as the case may be. We cannot assure you, however, what
standard a court would apply in making such determinations or that a court would
agree with our conclusions in this regard.
RISKS RELATING TO OUR BUSINESS
DOWNTURNS IN THE AGRICULTURAL INDUSTRY MAY HAVE A NEGATIVE IMPACT ON DEMAND FOR
AGRICULTURAL EQUIPMENT, WHICH WOULD ADVERSELY AFFECT OUR GROWTH AND RESULTS OF
OPERATIONS.
Historically, the agricultural industry has been cyclical and subject
to a variety of economic, governmental and weather conditions. Sales of
agricultural equipment generally are related to the health of the agricultural
industry, and downturns in the agricultural industry are likely to result in
decreases in demand for agricultural equipment. If demand for agricultural
equipment declines, our sales, growth and results of operations will be
adversely affected. Agricultural equipment sales are affected by farm income,
farm land values, farm cash receipts and farm profits, all of which reflect
levels of commodity prices, acreage planted, crop yields, demand, government
policies and government subsidies. In addition, recent outbreaks of livestock
diseases in Europe, including "mad cow disease" and "hoof and mouth disease,"
will have an adverse affect on farm income that will in turn adversely affect
sales of agricultural equipment. Agricultural equipment sales are also affected
by economic conditions, interest rate and exchange rate levels and the
availability of financing. Some of these factors combined with a general decline
in the agricultural industry have in the past, and could in the future, result
in a decline in our sales and profitability.
WE HAVE SIGNIFICANT INTERNATIONAL OPERATIONS AND, AS A RESULT, WE ARE EXPOSED TO
RISKS RELATED TO LAWS OF OTHER COUNTRIES, TAXES, ECONOMIC CONDITIONS,
FLUCTUATIONS IN CURRENCY RATES, LABOR SUPPLY AND RELATIONS, POLITICAL CONDITIONS
AND POLICIES OF FOREIGN GOVERNMENTS. THESE RISKS MAY DELAY OR REDUCE OUR
REALIZATION OF VALUE FROM OUR INTERNATIONAL OPERATIONS.
We derived $1.7 billion, or 72%, of our revenues for the year ended
December 31, 2000, from sales outside North America. The primary foreign
countries in which we do business are Germany, France, Brazil, Spain and the
United Kingdom. In addition, we have significant manufacturing operations in
Germany, the United Kingdom, France, Denmark and Brazil. Our production costs,
profit margins and competitive position are affected by the strength of the
currencies in countries where we manufacture or purchase goods relative to the
strength of the currencies in countries where our products are sold. Our results
of operations and financial position may be adversely affected by fluctuations
in foreign currency rates, taxes, local economic conditions, labor supply and
relations, political conditions and policies of foreign governments, and by
translations of the financial statements of our foreign subsidiaries from local
currencies into U.S. dollars. Our international operations are also subject to
various risks that are not present in domestic operations, including
restrictions on dividends and the repatriation of funds. Additionally, trends
abroad, such as farm consolidations, may affect the agricultural equipment
market. Foreign developing markets may present special risks, such as
unavailability of financing, inflation, slow economic growth, currency
fluctuations or price controls.
WE MAY ENCOUNTER DIFFICULTIES IN INTEGRATING AG-CHEM AS A WHOLLY-OWNED
SUBSIDIARY AND MAY NOT FULLY ACHIEVE, OR ACHIEVE WITHIN THE ANTICIPATED TIME
FRAME, EXPECTED STRATEGIC OBJECTIVES, COST SAVINGS AND OTHER BENEFITS OF THE
ACQUISITION.
On April 16, 2001, we acquired Ag-Chem as a wholly-owned subsidiary,
which previously had operated independently. It is impossible for us to predict
with certainty whether, or to what extent, we will realize the anticipated
benefits from this acquisition or whether we will be able to integrate Ag-Chem
in a timely and effective manner. In addition:
- the costs of integrating Ag-Chem may be higher than we expect;
- integration of Ag-Chem requires significant attention from our
management. This diversion of management attention and any
other difficulties associated with this integration could have
an adverse effect on our revenues, levels of expenses and
operating results after the transaction;
- the improvement in operating income we expect may not be
achieved during the time periods we expect, or at all; and
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- there are overlaps or redundancies in our and Ag-Chem's
products. For example, we and Ag-Chem both manufacture a 1,000
gallon sprayer. We are pursuing a multi-brand marketing
strategy for overlapping products and do not intend to
discontinue production of any competing products. Although we
have been successful with similar multi-brand marketing
strategies in the past and expect that this multi-brand
strategy will positively impact our results of operations, we
may not be successful in achieving these expectations.
WE ARE SUBJECT TO EXTENSIVE ENVIRONMENTAL LAWS AND REGULATIONS, AND OUR COSTS
RELATED TO COMPLIANCE WITH, OR OUR FAILURE TO COMPLY WITH, EXISTING OR FUTURE
LAWS AND REGULATIONS COULD ADVERSELY AFFECT OUR BUSINESS AND RESULTS OF
OPERATION.
We are subject to increasingly stringent environmental laws and
regulations in the countries in which we operate. Such regulations govern, among
other things, emissions into the air, discharges into water, the use, handling
and disposal of hazardous substances, waste disposal and the remediation of soil
and groundwater contamination. The European Union and the U.S. have adopted more
stringent environmental regulations regarding emissions into the air. As a
result, we will likely incur increased capital expenses to modify our products
to comply with these regulations. Our costs of complying with these or any other
current or future environmental regulations may be significant. Further, if we
fail to comply with existing or future laws and regulations we may be subject to
governmental or judicial fines or sanctions.
OUR LABOR FORCE IS HEAVILY UNIONIZED AND OUR CONTRACTUAL AND LEGAL OBLIGATIONS
UNDER COLLECTIVE BARGAINING AGREEMENTS AND LABOR LAWS MAY SUBJECT US TO GREATER
RISKS OF WORK INTERRUPTION OR STOPPAGE AND COULD IMPAIR OUR ABILITY TO ACHIEVE
COST SAVINGS THROUGH RESTRUCTURING PLANS.
Over 40% of our employees, principally at our manufacturing facilities,
are represented by collective bargaining agreements with expiration dates
ranging from 2001 to 2005. In addition, our acquisition of Ag-Chem may provide
the labor unions representing employees at some of our facilities with
opportunities to expand into non-union facilities. As a result, we may be
subject to increased risks of work interruption or stoppage, and we could incur
significant administrative expenses associated with union representation of our
employees. In addition, existing and future collective bargaining agreements
could impair our flexibility in streamlining existing manufacturing facilities
and in restructuring our business.
THE AGRICULTURAL EQUIPMENT INDUSTRY IS HIGHLY SEASONAL, AND SEASONAL
FLUCTUATIONS MAY CAUSE OUR RESULTS OF OPERATIONS TO FLUCTUATE SIGNIFICANTLY FROM
QUARTER TO QUARTER.
The agricultural equipment business is highly seasonal, because farmers
traditionally purchase agricultural equipment in the spring and fall in
conjunction with the major planting and harvesting seasons. Our net sales and
income from operations have historically been the lowest in the first quarter
and have increased in subsequent quarters as dealers increase inventory in
anticipation of increased retail sales in the third and fourth quarters. In
addition, Ag-Chem's net sales and income from operations are heavily
concentrated in February, March and April, and these sales and income will not,
for the most part, be reflected in our 2001 results.
WE FACE INTENSE COMPETITION, AND, IF WE ARE UNABLE TO COMPETE SUCCESSFULLY
AGAINST OTHER AGRICULTURAL EQUIPMENT MANUFACTURERS, WE COULD LOSE CUSTOMERS AND
OUR REVENUES MAY DECLINE.
The agricultural equipment business is highly competitive, particularly
in North America, Europe and Latin America. We compete with several large
national and international companies that, like us, offer a full line of
agricultural equipment, as well as with numerous short-line and specialty
manufacturers and suppliers of farm equipment products. Our two key competitors,
Deere & Co. and CNH Global, are substantially larger than we are and have
greater financial and other resources than we do. In addition, in some markets,
smaller regional competitors with significant market share in a single country
or group of countries also compete with us. We cannot assure you that these
competitors will not substantially increase the resources devoted to the
development and marketing, including discounting, of products that compete with
ours. If we are unable to compete successfully against other agricultural
equipment manufacturers, we could lose customers and our revenues may decline.
There can also be no assurance that consumers will continue to regard our
agricultural equipment favorably, that we will be able to develop new products
that appeal to consumers, or that we will be able to continue to compete
successfully in the agricultural equipment business. In addition, competitive
pressures in the agricultural equipment business may affect the market prices of
new and used equipment, which, in turn, may adversely affect our sales margins
and results of operations.
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MODIFICATION OF EXISTING, OR ADOPTION OF NEW, DOMESTIC AND FOREIGN GOVERNMENTAL
REGULATION OF AGRICULTURAL PRODUCTS COULD REQUIRE US TO INCREASE OUR CAPITAL
EXPENDITURES AND MAY ADVERSELY AFFECT OUR RESULTS OF OPERATIONS.
Domestic and foreign political developments and government regulations
and policies directly affect the agricultural industry in the U.S. and abroad,
which affects the demand for agricultural equipment. For example, a decrease or
elimination of current price protections for commodities in the European Union
or of subsidy payments for farmers in South America and the U.S., would likely
result in a decrease in demand for agricultural equipment. If demand for
agricultural equipment declines, our sales, growth and results of operations may
be adversely affected.
RISKS RELATED TO THIS EXCHANGE OFFER
IF YOU DO NOT PROPERLY TENDER YOUR OLD NOTES FOR NEW NOTES, YOU WILL CONTINUE TO
HOLD UNREGISTERED NOTES WHICH ARE SUBJECT TO TRANSFER RESTRICTIONS.
We will only issue new notes in exchange for old notes that are timely
received by the exchange agent together with all required documents. Therefore,
you should allow sufficient time to ensure timely delivery of the old notes and
you should carefully follow the instructions on how to tender your old notes set
forth under "The Exchange Offer -- Procedures for Tendering" and in the letter
of transmittal that you will receive with this prospectus. Neither we nor the
exchange agent are required to tell you of any defects or irregularities with
respect to your tender of the old notes.
If you do not tender your old notes or if we do not accept your old
notes because you did not tender your old notes properly, then you will continue
to hold old notes that are subject to the existing transfer restrictions. In
addition, if you tender your old notes for the purpose of participating in a
distribution of the new notes, you will be required to comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale of the new notes. If you continue to hold any old
notes after the exchange offer is completed, you may have difficulty selling
them because of the restrictions on transfer and because there will be fewer old
notes outstanding. In addition, if a large amount of old notes are not tendered
or are tendered improperly, the limited amount of new notes that would be issued
and outstanding after we complete the exchange offer could lower the market
price of the new notes.
IF AN ACTIVE TRADING MARKET DOES NOT DEVELOP FOR THE NEW NOTES, YOU MAY BE
UNABLE TO SELL THE NEW NOTES OR TO SELL THEM AT A PRICE YOU DEEM SUFFICIENT.
The new notes will be new securities for which there is no established
trading market. We do not intend to list the new notes on any exchange. We
cannot give you any assurance as to:
- the liquidity of any trading market that may develop;
- the ability of holders to sell their new notes; or
- the price at which holders would be able to sell their new
notes.
Even if a trading market develops, the new notes may trade at higher or
lower prices than their principal amount or purchase price, depending on many
factors, including:
- prevailing interest rates;
- the number of holders of the notes;
- the interest of securities dealers in making a market for the
notes;
- the market for similar notes; and
- our financial performance.
Finally, if a large number of holders of old notes do not tender old
notes or tender old notes improperly, the limited amount of new notes that would
be issued and outstanding after we complete the exchange offer could adversely
affect the development of a market for the new notes.
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USE OF PROCEEDS
This exchange offer is intended to satisfy our obligations under the
registration rights agreement that we entered into relating to the old notes. We
will not receive any proceeds from the exchange offer. You will receive, in
exchange for old notes tendered by you in the exchange offer, new notes in like
principal amount. The old notes tendered in exchange for the new notes will be
retired and cancelled and cannot be reissued. Accordingly, the issuance of the
new notes will not result in any increase of our outstanding debt.
We used the net proceeds from the sale of the old notes, which were
approximately $245.0 million, together with proceeds from the new revolving
credit facility to refinance our old revolving credit facility.
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THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
We sold the old notes on April 17, 2001 to Credit Suisse First Boston
Corporation, Bear, Stearns & Co. Inc. and SunTrust Equitable Securities pursuant
to a purchase agreement. These initial purchasers subsequently sold the old
notes to:
- "qualified institutional buyers" ("QIBs"), as defined in Rule
144A under the Securities Act, in reliance on Rule 144A; and
- persons in offshore transactions in reliance on Regulation S
under the Securities Act.
As a condition to the initial sale of the old notes, we entered into a
registration rights agreement with the initial purchasers. Pursuant to the
registration rights agreement, we agreed to:
- file with the SEC by July 16, 2001 a registration statement
under the Securities Act with respect to the issuance of the
new notes in an exchange offer;
- use our commercially reasonable efforts to cause the
registration statement to become effective under the
Securities Act on or before September 14, 2001;
- offer the new notes in exchange for tender of the old notes as
soon as practicable after the effectiveness of the
registration statement; and
- keep the exchange offer open for not less than 30 days (or
longer if required by applicable law) after the date notice of
the exchange offer is mailed to the holders.
We agreed to issue and exchange the new notes for all old notes validly
tendered and not validly withdrawn prior to the expiration of the exchange
offer. Under the registration rights agreement, our obligations to register the
new notes will terminate upon the completion of the exchange offer. As a result
of the timely filing and the effectiveness of the registration statement, we
will not have to pay certain additional interest on the old notes provided in
the registration rights agreement. However, we will be required to file a
"shelf" registration statement for a continuous offering by the holders of the
outstanding notes if:
- applicable interpretations of the SEC do not permit us to
effect the exchange offer as contemplated by the registration
rights agreement;
- for any other reason we do not complete the exchange offer on
or before October 14, 2001;
- an initial purchaser shall notify us within 10 days following
consummation of the exchange offer that the old notes held by
it are not eligible to be exchanged for new notes in the
exchange offer; or
- any holder shall notify us within 10 days following completion
of the exchange offer that such holder (1) is prohibited by
law or SEC policy from participating in the exchange offer,
(2) may not resell the new notes acquired by it in the
exchange offer to the public without delivering a prospectus
and the prospectus contained in this registration statement is
not appropriate or available for such resales by such holder,
or (3) is a broker-dealer and holds notes that are part of an
unsold allotment from the original sale of the notes.
If we are required to file a shelf registration statement, we will be
required to use our commercially reasonable efforts to keep the registration
statement effective for two years, subject to some exceptions. Other than as
described above, no holder will have the right to require us to file a shelf
registration statement or otherwise register such holder's notes under the
federal securities laws.
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The registration rights agreement also provides that we:
- shall make available for a period of up to 180 days after the
expiration date of the exchange offer a prospectus meeting the
requirements of the Securities Act to any broker-dealer or any
other person, if any, with similar prospectus delivery
requirements to use in connection with any resale of the new
notes; and
- shall pay all expenses incident to the exchange offer and will
indemnify holders of the notes (including any broker-dealer)
against specified liabilities, including liabilities under the
Securities Act. A broker-dealer that delivers a prospectus to
purchasers in connection with such resales will be subject to
some of the civil liability provisions under the Securities
Act, and will be bound by the provisions of the registration
rights agreement (including certain indemnification rights).
If you are a broker-dealer and you will receive new notes for your own
account in exchange for old notes that were acquired as a result of
market-making activities or other trading activities, you must acknowledge in
the letter of transmittal that you will deliver a prospectus in connection with
any resale of your new notes. See "Plan of Distribution."
This summary includes only the material terms of the registration
rights agreement. For a full description, you should refer to the complete copy
of the registration rights agreement, which was filed as an exhibit to our
Quarterly Report on Form 10-Q that was filed with the SEC on May 15, 2001.
The term "holder" with respect to the exchange offer means any person
in whose name old notes are registered on the trustee's books or any other
person who has obtained a properly completed bond power from the registered
holder, or any person whose old notes are held of record by The Depository Trust
Company, which we refer to as the "Depositary" or "DTC," who desires to deliver
the old notes by book-entry transfer at DTC.
TERMS OF THE EXCHANGE OFFER
Based on the terms and conditions in this prospectus and in the letter
of transmittal, we will issue $1,000 principal amount of new notes in exchange
for each $1,000 principal amount of outstanding old notes properly tendered
pursuant to the exchange offer and not withdrawn prior to the expiration date.
Holders may tender some or all of their notes pursuant to the exchange offer,
however notes may be tendered only in integral multiples of $1,000. The form and
terms of the new notes are the same in all material respects as the form and
terms of the old notes except that:
- the new notes will be registered under the Securities Act and,
therefore, the transfer restrictions applicable to the old
notes will not be applicable to the new notes, and the new
notes will not bear any legends restricting their transfer;
and
- holders of the new notes will not be entitled to certain
rights under the registration rights agreement, including the
provisions for an increase in the interest rate on the
outstanding notes in some circumstances relating to the timing
of the exchange offer.
The new notes will evidence the same indebtedness as the old notes,
which they replace, and will be issued under, and be entitled to the benefits
of, the same indenture, which authorized the issuance of the old notes. As a
result, both series of notes will be treated as a single class of debt
securities under the indenture.
As of the date of this prospectus, $250 million in aggregate principal
amount of the old notes is outstanding. The entire amount is registered in the
name of Cede & Co., as nominee for DTC. Solely for reasons of administration, we
have fixed the close of business on , 2001 as the record date for
the exchange offer for purposes of determining the persons to whom this
prospectus and the letter of transmittal will be mailed initially. There will be
no fixed record date for determining holders of the old notes entitled to
participate in this exchange offer.
In connection with the exchange offer, neither the General Corporation
Law of the State of Delaware nor the indenture governing the notes gives you any
appraisal or dissenters' rights nor any other right to seek monetary damages in
court. We
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intend to conduct the exchange offer in accordance with the provisions of the
registration rights agreement and the applicable requirements of the Securities
Exchange Act and the related SEC rules and regulations.
For all relevant purposes, we will be regarded as having accepted
properly tendered old notes if and when we give written notice of our acceptance
to the exchange agent. The exchange agent will act as agent for the tendering
holders of old notes for the purposes of receiving the new notes from us.
If you tender old notes in the exchange offer, you will not be required
to pay brokerage commissions or fees. In addition, subject to the instructions
in the letter of transmittal, you will not have to pay transfer taxes for the
exchange of old notes. We will pay all charges and expenses, other than certain
applicable taxes described under "-- Fees and Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The "expiration date" is 5:00 p.m., New York City time on ,
2001 unless we extend the exchange offer, in which case the expiration date is
the latest date and time to which we extend the exchange offer.
In order to extend the exchange offer, we will:
- notify the exchange agent of any extension by written notice;
and
- issue a press release or other public announcement which would
include disclosure of the approximate number of old notes
deposited and which would be issued prior to 9:00 a.m., New
York City time, on the next business day after the previously
scheduled expiration date.
We reserve the right:
- to delay accepting any old notes;
- to extend the exchange offer;
- to terminate or amend the exchange offer, and not accept for
exchange any old notes not previously accepted for exchange,
upon the occurrence of an event described in "--Conditions of
the Exchange Offer" by giving written notice to the exchange
agent; or
- to waive any conditions or otherwise amend the exchange offer
in any respect, by giving written notice to the exchange
agent.
Any delay in acceptance, extension, termination or amendment will be
followed as soon as practicable by a press release or other public announcement
or post-effective amendment to the registration statement.
If the exchange offer is amended in a manner determined by us to
constitute a material change, we will promptly disclose that amendment by means
of a prospectus supplement or post-effective amendment that will be distributed
to the holders. We will also extend the exchange offer for a period of five to
ten business days, depending upon the significance of the amendment and the
manner of disclosure to the holders, if the exchange offer would otherwise
expire during the five to ten business day period.
We will have no obligation to publish, advertise or otherwise
communicate any public announcement of any delay, extension, amendment (other
than amendments constituting a material change to the exchange offer) or
termination that we may choose to make, other than by making a timely release to
an appropriate news agency.
INTEREST ON THE NEW NOTES
The new notes will accrue cash interest on the same terms as the old
notes at the rate of 9 1/2% per year from April 17, 2001, payable semi-annually
in arrears on May l and November 1 of each year, commencing November 1, 2001.
Old notes
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accepted for exchange will not receive accrued interest thereon at the time of
exchange. However, each new note will bear interest from the most recent date to
which interest has been paid on the old notes, or if no interest has been paid
on the old notes or the new notes, from April 17, 2001.
RESALE OF THE NEW NOTES
Based on interpretations by the staff of the SEC set forth in no-action
letters issued to third parties, we believe that you will be allowed to resell
the new notes to the public without registration under the Securities Act, and
without delivering a prospectus that satisfies the requirements of Section 10 of
the Securities Act, if :
- you are acquiring the new notes in the ordinary course of your
business;
- you are not engaged in, and you do not intend to engage in,
the distribution (within the meaning of the federal securities
laws) of the new notes;
- you have no arrangement or understanding with anyone to
participate in a distribution of the new notes; and
- you are not an "affiliate," as defined in Rule 405 under the
Securities Act, of AGCO.
To participate in the exchange offer, you must represent as the holder
of outstanding notes that each of these statements is true.
Any holder of outstanding notes who is our affiliate or who intends to
participate in the exchange offer for the purpose of distributing the new notes:
- will not be able to rely on the interpretation of the staff of
the SEC set forth in the no-action letters described above;
and
- must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale
or transfer of the notes, unless the sale or transfer is made
pursuant to an exemption from those requirements.
Broker-dealers receiving new notes in exchange for outstanding notes
acquired for their own account through market-making or other trading activities
may not rely on this interpretation by the SEC. Such broker-dealers may be
deemed to be "underwriters" within the meaning of the Securities Act and must
therefore acknowledge, by signing the letter of transmittal, that they will
deliver a prospectus meeting the requirements of the Securities Act in
connection with resale of the new notes. The letter of transmittal states that
by acknowledging that it will deliver, and by delivering, a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. The SEC has taken the position that participating
broker-dealers may fulfill their prospectus delivery requirements with respect
to the new notes, other than a resale of an unsold allotment from the original
sale of the outstanding notes, with the prospectus contained in this
registration statement. As described above, under the registration rights
agreement, we have agreed to allow participating broker-dealers and other
persons, if any, with similar prospectus delivery requirements to use the
prospectus contained in this registration statement in connection with the
resale of the new notes for 180 days after the expiration date of the exchange
offer. See "Plan of Distribution."
Our belief that you will be allowed to resell the new notes without
registration is based on interpretations of the SEC for other exchange offers
that the SEC expressed in some of the SEC's no-action letters to third parties.
However, we have not asked the SEC to consider this particular exchange offer in
the context of a no-action letter. Therefore, you cannot be certain that the SEC
will treat it in the same way it has treated other exchange offers in the past.
PROCEDURES FOR TENDERING
General Procedures
Only a holder of outstanding notes may tender notes in the exchange
offer. If you wish to tender old notes you must:
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- complete, sign and date the letter of transmittal, or a
facsimile of the letter of transmittal, or send a timely
confirmation of a book-entry transfer of your old notes to the
exchange agent;
- have the signatures guaranteed if required by the letter of
transmittal; and
- mail or deliver the required documents to the exchange agent
at the address appearing below under "-- Exchange Agent" for
receipt prior to the expiration date.
In addition, either:
- certificates for your old notes must be received by the
exchange agent along with the letter of transmittal;
- a timely confirmation of a book-entry transfer of the old
notes into the exchange agent's account at DTC, pursuant to
the procedure for book-entry transfer described below, must be
received by the exchange agent prior to the expiration date;
or
- you must comply with the procedures described below under "--
Guaranteed Delivery Procedures."
THE METHOD OF DELIVERY TO THE EXCHANGE AGENT OF OLD NOTES, THE LETTER
OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT YOUR ELECTION AND RISK.
INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT YOU USE AN OVERNIGHT OR HAND
DELIVERY SERVICE, PROPERLY INSURED. IN ALL CASES, YOU SHOULD ALLOW SUFFICIENT
TIME TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. DO NOT
SEND THE LETTER OF TRANSMITTAL OR ANY OLD NOTES TO US. YOU MAY REQUEST THAT YOUR
BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR NOMINEE PERFORM THESE
TRANSACTIONS FOR YOU.
If you do not withdraw your tender of old notes prior to the expiration
date, you will be regarded as agreeing to tender the new notes in accordance
with the terms and conditions in this offer.
If you are a beneficial owner of the old notes and your old notes are
held through a broker, dealer, commercial bank, trust company or other nominee
and you want to tender your old notes, you should contact your intermediary
promptly and instruct it to tender the old notes on your behalf.
Signatures and Guarantee of Signatures
Signatures on a letter of transmittal or a notice of withdrawal
described below under "-- Withdrawal of Tenders," as the case may be, must
generally be guaranteed by an eligible institution. You can submit a letter of
transmittal without guarantee if you tender your old notes:
- as a registered holder and you have not completed the box
titled "Special Delivery Instruction" on the letter of
transmittal; or
- for the account of an eligible institution.
In the event that signatures on a letter of transmittal or a notice of
withdrawal are required to be guaranteed, the guarantee must be made by:
- a member firm of a registered national securities exchange or
of the National Association of Securities Dealers;
- a commercial bank or trust company having an office or
correspondent in the U.S.; or
- an "eligible guarantor institution" within the meaning of Rule
17Ad-15 under the Exchange Act which is a member of one of the
recognized signature guarantee programs identified in the
letter of transmittal.
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If you sign the letter of transmittal even though you are not the
registered holder of any old notes listed in the letter of transmittal, your
notes must be endorsed or accompanied by a properly completed bond power, signed
by the registered holder exactly as the registered holder's name appears on the
old notes and must be guaranteed by an "eligible guarantor institution."
In connection with any tender of old notes in definitive certificated
form, if you sign the letter of transmittal or any old notes or bond powers in
your capacity as trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or if you are otherwise acting in a fiduciary or
representative capacity, you must indicate this when signing. Unless waived by
us, you must submit with the letter of transmittal evidence satisfactory to us
of your authority to act in the particular capacity.
The exchange agent and DTC have confirmed that any financial
institution that is a participant in DTC's system may utilize DTC's automated
tender offer program to tender old notes.
Acceptance of Tenders
Your tender of old notes will constitute an agreement between you and
us governed by the terms and conditions provided in this prospectus and in the
letter of transmittal. We will be deemed to have received your tender as of the
date when your duly signed letter of transmittal accompanied by your old notes
tendered, or a timely confirmation of a book-entry transfer of these notes into
the exchange agent's account at DTC with an agent's message, or a notice of
guaranteed delivery from an eligible institution is received by the exchange
agent. All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered old notes will be determined by
us in our sole discretion, which will be final and binding.
We reserve the absolute right to reject any and all old notes not
properly tendered. Nor will we accept any old notes if our acceptance of them
would, in the opinion of our counsel, be unlawful. We also reserve the right to
waive any defects, irregularities or conditions of tender as to particular old
notes.
Unless waived, you must cure any defects or irregularities in
connection with tenders of old notes within the time period we will determine.
Although we intend to notify holders of defects or irregularities in connection
with tenders of old notes, neither we, the exchange agent nor anyone else will
be liable for failure to give this notice. Tenders of old notes will not be
deemed to have been made until any defects or irregularities have been cured or
waived.
Effect of Tendering Old Notes
By tendering old notes pursuant to the exchange offer, you will be
telling us that, among other things:
- you have full power and authority to tender, sell, assign and
transfer the old notes tendered;
- we will acquire good title to the old notes being tendered,
free and clear of all security interests, liens, restrictions,
charges, encumbrances, conditional sale agreements or other
obligations relating to their sale or transfer, and not
subject to any adverse claim when the old notes are accepted
by us;
- you are acquiring the new notes in the ordinary course of your
business;
- you are not engaged in, and do not intend to engage in, the
distribution of the new notes;
- you have no arrangement or understanding with any person to
participate in the distribution of the new notes;
- you acknowledge and agree that if you are a broker-dealer
registered under the Exchange Act or you are participating in
the exchange offer for the purpose of distributing the new
notes, you must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with
a secondary resale of the new notes, and you understand that
you cannot rely on the position of the SEC's staff in their
no-action letters;
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- you understand that a secondary resale transaction described
above and any resales of new notes obtained by you in exchange
for old notes acquired by you directly from us should be
covered by an effective registration statement containing the
selling security holder information required by Item 507 or
Item 508 of Regulation S-K of the SEC; and
- you are not an "affiliate," as defined in Rule 405 under the
Securities Act, of AGCO.
If you are a broker-dealer and you will receive new notes for your own
account in exchange for old notes that were acquired as a result of
market-making activities or other trading activities, you must acknowledge in
the letter of transmittal that you will deliver a prospectus in connection with
any resale of your new notes. See "Plan of Distribution."
RETURN OF OLD NOTES
If any tendered old notes are not accepted for any reason described in
this prospectus or if old notes are withdrawn or are submitted for a greater
principal amount than you desire to exchange, those old notes will be returned
without expense as promptly as practicable (1) to the person who tendered them
or (2) in the case of old notes tendered by book-entry transfer into the
exchange agent's account at DTC, the old notes will be credited to an account
maintained with DTC.
BOOK-ENTRY DELIVERY PROCEDURE
Any financial institution that is a participant in DTC's system may
make book-entry deliveries of old notes by causing DTC to transfer these old
notes into the exchange agent's account at DTC according to DTC's procedures for
transfer. To effectively tender notes through DTC, the financial institution
that is a participant in DTC will electronically transmit its acceptance through
the Automated Tender Offer Program. DTC will then edit and verify the acceptance
and send an agent's message to the exchange agent for its acceptance. An agent's
message is a message transmitted by DTC to the exchange agent stating that DTC
has received an express acknowledgment from the participant in DTC tendering the
old notes that the participant has received and agrees to be bound by the terms
of the letter of transmittal, and that we may enforce this agreement against the
participant. The exchange agent will make a request to establish an account for
the old notes at DTC for purposes of the exchange offer within two business days
after the date of this prospectus.
A delivery of old notes through a book-entry transfer into the exchange
agent's account at DTC will only be effective if an agent's message or the
letter of transmittal or a facsimile of the letter of transmittal with any
required signature guarantees and any other required documents is transmitted to
and received by the exchange agent at the address indicated below under "--
Exchange Agent" for its receipt on or before the expiration date unless the
guaranteed delivery procedures described below are complied with. Delivery of
documents to DTC does not constitute delivery to the exchange agent.
GUARANTEED DELIVERY PROCEDURES
If you wish to tender your old notes and (1) your old notes are not
readily available so you can meet the expiration date deadline or (2) you cannot
deliver your old notes, the letter of transmittal or any other required
documents to the exchange agent prior to the expiration date, you may still
participate in the exchange offer if:
- the tender is made through an "eligible guarantor
institution";
- prior to the expiration date, the exchange agent receives from
the eligible institution a properly completed and duly
executed notice of guaranteed delivery substantially in the
form provided by us, by facsimile transmission, mail or hand
delivery, containing the name and address of the holder, the
certificate number(s) of the old notes, if applicable, and the
principal amount of old notes tendered. The notice of
guaranteed delivery must also state that the tender is being
made thereby and guarantee that, within three New York Stock
Exchange trading days after the expiration date, the letter of
transmittal, together with the certificate(s) representing the
old notes in proper form for transfer or a book-entry
confirmation with an agent's message, as the case may be, and
any other required documents, will be deposited by the
eligible institution with the exchange agent; and
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- the properly executed letter of transmittal, as well as the
certificate(s) representing all tendered old notes in proper
form for transfer or a book-entry confirmation, as the case
may be, and all other documents required by the letter of
transmittal are received by the exchange agent within three
New York Stock Exchange trading days after the expiration
date.
WITHDRAWAL OF TENDERS
Except as otherwise provided in this prospectus, you may withdraw your
tendered old notes at any time prior to the expiration date.
For a withdrawal of a tender of old notes to be effective, a written or
facsimile transmission notice of withdrawal must be received by the exchange
agent on or prior to the expiration of the exchange offer. For DTC participants,
a written notice of withdrawal may be made by electronic transmission through
DTC's Automated Tender Offer Program. Any notice of withdrawal must:
- specify the name of the person having deposited the old notes
to be withdrawn;
- identify the old notes to be withdrawn, including the
certificate number or numbers, if applicable, and principal
amount of the old notes, or in the case of notes transferred
by book-entry transfer, the name and number of the account at
DTC; and
- be signed by the holder in the same manner as the original
signature on the letter of transmittal by which the old notes
were tendered or be accompanied by documents of transfer
sufficient to permit the trustee for the initial notes to
register the transfer of these notes into the name of the
person having made the original tender and withdrawing the
tender.
All questions as to the validity, form, eligibility and time of receipt
of notices will be determined by us, in our sole discretion, and our
determination shall be final and binding on all parties. Any old notes so
withdrawn will be deemed not to have been validly tendered for purposes of the
exchange offer, and no new notes will be issued unless the old notes so
withdrawn are validly retendered. Properly withdrawn old notes may be retendered
by following one of the procedures described above under "-- Procedures for
Tendering" at any time prior to the expiration date.
CONDITIONS OF THE EXCHANGE OFFER
Notwithstanding any other term of the exchange offer, or any extension
of the exchange offer, we do not have to accept for exchange, or exchange new
notes for, any old notes, and we may terminate the exchange offer before
acceptance of the old notes, if we determine in our sole discretion that this
exchange offer would violate applicable law or regulation of any applicable
interpretation of the staff of the SEC.
EXCHANGE AGENT
SunTrust Bank is the exchange agent for the exchange offer. You should
direct any questions and requests for assistance, requests for additional copies
of this prospectus or of the letter of transmittal and requests for notice of
guaranteed delivery to the exchange agent, addressed as follows:
By Registered or Certified Mail: By Hand or Overnight Delivery:
SunTrust Bank SunTrust Bank
25 Park Place 25 Park Place
24th Floor 24th Floor
Atlanta, Georgia 30303-2900 Atlanta, Georgia 30303-2900
Attention: Corporate Trust Attention: Corporate Trust
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To Confirm by Telephone:
(404) 588-7296
Facsimile Transmissions (eligible institutions only):
(404) 588-7335
Originals of all documents sent by facsimile should be promptly sent to
the exchange agent by registered or certified mail, by hand, or by overnight
delivery service. DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE WILL NOT
CONSTITUTE A VALID DELIVERY.
SunTrust Bank also serves as trustee under the indenture governing the
notes.
FEES AND EXPENSES
We will pay for the expenses of the exchange offer. The principal
solicitation is being made by mail. However, additional solicitation may be made
by facsimile transmission, e-mail, telephone or in person by our officers and
regular employees.
We have not retained a dealer-manager for the exchange offer and will
not make any payments to brokers, dealers or others soliciting acceptances of
the exchange offer. We will, however, pay the exchange agent reasonable and
customary fees and out-of-pocket expenses.
We will pay any transfer taxes applicable to the exchange of old notes.
If, however, a transfer tax is imposed for any reason other than the exchange,
then the amount of any transfer taxes will be payable by the person tendering
the notes. If you do not submit satisfactory evidence of payment of taxes or of
an exemption with the letter of transmittal, the amount of those transfer taxes
will be billed directly to you.
CONSEQUENCES OF FAILING TO EXCHANGE OLD NOTES
Participation in the exchange offer is voluntary. You are urged to
consult your financial and tax advisors in making your decisions on what action
to take. Old notes that are not exchanged will remain "restricted securities"
within the meaning of Rule 144(a)(3)(iv) of the Securities Act. Accordingly,
they may not be offered, sold, pledged or otherwise transferred except:
- to a person who the seller reasonably believes is a "qualified
institutional buyer" within the meaning of Rule 144A under the
Securities Act purchasing for its own account or for the
account of a qualified institutional buyer in a transaction
meeting the requirements of Rule 144A;
- in an offshore transaction complying with Rule 904 of
Regulation S under the Securities Act;
- pursuant to an exemption from registration under the
Securities Act provided by Rule 144, if available; or
- pursuant to an effective registration statement under the
Securities Act.
In addition, to the extent old notes are tendered and accepted in the
exchange offer, the principal amount of outstanding notes will be reduced by the
amount so tendered. As a result, a holder's ability to sell untendered
outstanding notes could be adversely affected.
ACCOUNTING TREATMENT
For accounting purposes, we will recognize no gain or loss as a result
of the exchange offer. The expenses of the exchange offer will be amortized over
the remaining term of the notes.
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DESCRIPTION OF THE NEW NOTES
The terms of the new notes and the old notes are identical in all
material respects, except that transfer restrictions and registration rights and
related liquidated damages provisions applicable to the old notes do not apply
to the new notes.
The old notes were, and the new notes will be, issued under an
indenture dated April 17, 2001 among us, as issuer, AGCO Ventures LLC, Hesston
Ventures Corporation, Hay & Forage Industries, Ag-Chem Equipment Co., Inc.,
Ag-Chem Manufacturing Co., Inc., Ag-Chem Sales Co., Inc., Ag-Chem Equipment
International, Inc., Lor*Al Products, Inc. and Ag-Chem Equipment Canada, Ltd.,
as subsidiary guarantors, and SunTrust Bank, as trustee. The terms of the notes
include those stated in the indenture and those made part of the indenture by
reference to the Trust Indenture Act of 1939 (the "TIA"). Upon the issuance of
the new notes, the indenture will be subject to and governed by the TIA.
Certain terms used in this description are defined under the subheading
"Certain Definitions."
The following description is only a summary of the material terms of
the indenture. For a full description, you should refer to the complete copy of
the indenture, which has been filed as an exhibit to our Quarterly Report on
Form 10-Q that was filed with the SEC on May 15, 2001.
GENERAL
The notes:
- are unsecured senior obligations of AGCO;
- accrue interest from April 17, 2001 at a rate of 9 1/2% per
annum, which is payable semi-annually;
- mature on May 1, 2008;
- are pari passu in right of repayment with all of our other
existing and future unsecured senior indebtedness; and
- are senior in right of payment to our 8 1/2% senior
subordinated notes and any of our existing and future
subordinated indebtedness.
PRINCIPAL, MATURITY AND INTEREST
We will issue the new notes initially in an aggregate principal amount
of $250 million in this exchange offer. We will issue the new notes in
denominations of $1,000 and any integral multiple thereof.
Each note will initially bear interest at a rate of 9 1/2% per annum
from April 17, 2001 and will be payable semiannually on May 1 and November 1 of
each year, commencing November 1, 2001. We will make each interest payment to
the holders of record of the notes on the immediately preceding April 15 and
October 15.
Principal of, premium, if any, and interest on the notes are payable,
and the notes are exchangeable and transfers thereof are registrable, at our
office or agency in the Borough of Manhattan, the City of New York (which
initially will be the corporate trust office of the Trustee c/o BankOne Trust
Company, 14 Wall Street, 8th Floor, New York, New York 10005-2101); provided
that, at our option, payment of interest may be made by check mailed to the
address of the holders as such address appears in the security register.
We do not intend to list the notes on a national securities exchange.
OPTIONAL REDEMPTION
On or after May 1, 2005, we may redeem all or a part of the notes, at
any time, by mailing notice by first class mail to each holders' last address as
it appears in the security register of any redemption at least 30 days but not
more than 60 days before the
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relevant redemption date. We will pay each holder the following redemption
prices (expressed in percentages of principal amount), plus accrued and unpaid
interest, if any, to the redemption date (subject to the right of holders of
record on the relevant record date that is on or prior to the redemption date to
receive interest due on an interest payment date), if redeemed during the
12-month period commencing May 1, of the years set forth below:
REDEMPTION
YEAR PRICE
---- ----------
2005........................................................................ 104.750%
2006........................................................................ 102.375%
2007 and thereafter......................................................... 100.000%
SELECTION AND NOTICE
If less than all of the notes are to be redeemed at any time, the
trustee will select notes for redemption as follows:
- if the notes are listed on any national securities exchange,
in compliance with the requirements of the principal national
securities exchange on which the notes are listed or,
- if the notes are not listed on a national securities exchange,
on a pro rata basis, by lot or by such other method as the
Trustee in its sole discretion shall deem to be fair and
appropriate.
No notes of $1,000 in principal amount or less will be redeemed in
part. If any note is to be redeemed in part only, the notice of redemption
relating to the note shall state the portion of the principal amount to be
redeemed. A new note in principal amount equal to the unredeemed portion will be
issued in the name of its holder upon cancellation of the original note.
SUBSIDIARY GUARANTEES
The guarantors of the notes, which include all of AGCO's domestic
subsidiaries existing on April 17, 2001, except Massey Ferguson Corp., AGCO
Funding Corporation and AGCO Acceptance Corporation, will jointly and severally,
fully and unconditionally guarantee AGCO's obligations under the indenture and
the notes. The obligations of each guarantor under its subsidiary guarantee will
be limited as necessary to prevent that subsidiary guarantee from constituting a
fraudulent conveyance or fraudulent transfer under applicable law. A guarantor
may not sell or otherwise dispose of all or substantially all of its assets to,
or consolidate with or merge with or into (whether or not such guarantor is the
surviving person), another person (other than AGCO or another guarantor) unless:
- immediately after giving effect to that transaction, no
default or event of default exists; and
- either:
- the person acquiring the property in any such sale or
disposition or the person formed by or surviving any
such consolidation or merger assumes all the
obligations of that guarantor pursuant to a
supplemental indenture satisfactory to the trustee;
or
- the "net proceeds" of such sale or other disposition
are applied in accordance with the applicable
provisions of the indenture.
The subsidiary guarantee of a guarantor will be released:
- in connection with any sale or other disposition of all or
substantially all of the assets of that guarantor to a third
party other than AGCO or an affiliate of AGCO (including by
way of merger or consolidation), if AGCO applies the "net
proceeds" of that sale or other disposition in accordance with
the applicable provisions of the indenture;
- in connection with any sale of all of the capital stock of a
guarantor, if AGCO applies the "net proceeds" of that sale in
accordance with the applicable provisions of the indenture;
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- if AGCO designates any restricted subsidiary that is a
guarantor as an unrestricted subsidiary in accordance with the
indenture;
- in connection with the merger or dissolution of a guarantor
into AGCO or another guarantor; or
- upon the legal defeasance of the notes as described under the
caption "--Defeasance."
As of June 30, 2001, the total assets of each of AGCO, the guarantors
and the non-guarantor subsidiaries were $ million, $ million and
$ million, respectively. As of June 30, 2001, the total liabilities of
each of AGCO, the guarantors and the non-guarantor subsidiaries were $
million, $ million and $ million, respectively. As of June 30, 2001,
the total assets of each of AGCO, the guarantors and the non-guarantor
subsidiaries were $ million, $ million and $ million,
respectively. As of June 30, 2001, the total liabilities of each of AGCO, the
guarantors and the non-guarantor subsidiaries were $ million, $ million
and $ million, respectively.
SINKING FUND
There will be no sinking fund payments for the notes.
RANKING
Senior Indebtedness versus Notes
The indebtedness evidenced by these notes will rank pari passu in right
of payment to our senior indebtedness and will be effectively subordinated to
all of our existing and future secured indebtedness to the extent of the value
of the assets securing such indebtedness. As of June 30, 2001, our senior
indebtedness was $ million, of which approximately $ million
represented secured indebtedness under our revolving credit facility.
Liabilities of Subsidiaries versus Notes
Certain of our operations are conducted through subsidiaries. Certain
of our domestic restricted subsidiaries guarantee our obligations with respect
to the notes. The notes will effectively be subordinated to the creditors,
including trade creditors, of our non-guarantor subsidiaries. As of June 30,
2001, the liabilities of our non-guarantor restricted subsidiaries (other
than borrowings under the revolving credit facility) were approximately
$ million.
Subsidiary Guarantees
The subsidiary guarantees by the guarantors will be unsecured general
obligations of the guarantors and will rank pari passu with all current and
future unsubordinated indebtedness, and senior to all current and future
subordinated indebtedness, of the guarantors. Holders of the notes will be
direct creditors of each of the guarantors by virtue of the subsidiary
guarantees.
Senior Subordinated Indebtedness versus Notes
The indebtedness evidenced by these notes will rank senior in right of
payment to our 8 1/2% senior subordinated notes and all of our existing and
future subordinated indebtedness.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in
the covenants and other provisions of the indenture. Please read the indenture
for the full definition of all terms as well as any other capitalized term used
in this summary for which no definition is provided.
"Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Restricted Subsidiary or assumed in connection with
an Asset Acquisition by a Restricted Subsidiary and not Incurred in connection
with, or in
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anticipation of, such Person becoming a Restricted Subsidiary or such Asset
Acquisition; provided that Indebtedness of such Person which is redeemed,
defeased, retired or otherwise repaid at the time of or immediately upon
consummation of the transactions by which such Person becomes a Restricted
Subsidiary or such Asset Acquisition shall not be Acquired Indebtedness.
"Adjusted Consolidated Net Income" means, for any period, the aggregate
net income (or loss) of AGCO and its Restricted Subsidiaries for such period
determined in conformity with GAAP; provided that the following items shall be
excluded in computing Adjusted Consolidated Net Income (without duplication):
(i) the net income of any Person (other than net income
attributable to a Restricted Subsidiary) in which any Person (other
than AGCO or any of its Restricted Subsidiaries) has a joint interest
and the net income of any Unrestricted Subsidiary, except to the extent
of the amount of dividends or other distributions actually paid to AGCO
or any of its Restricted Subsidiaries by such other Person or such
Unrestricted Subsidiary during such period;
(ii) solely for the purposes of calculating the amount of
Restricted Payments that may be made pursuant to clause (C) of
paragraph (a) of the "Limitation on Restricted Payments" covenant
described below (and in such case, except to the extent includable
pursuant to clause (i) above), the net income (or loss) of any Person
accrued prior to the date it becomes a Restricted Subsidiary or is
merged into or consolidated with AGCO or any of its Restricted
Subsidiaries or all or substantially all of the property and assets of
such Person are acquired by AGCO or any of its Restricted Subsidiaries;
(iii) the net income of any Restricted Subsidiary to the
extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of such net income is not
at the time permitted by the operation of the terms of its charter or
any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Restricted Subsidiary;
(iv) any gains or losses (on an after-tax basis)
attributable to Asset Sales;
(v) except for purposes of calculating the amount of
Restricted Payments that may be made pursuant to clause (C) of
paragraph (a) of the "Limitation on Restricted Payments" covenant
described below, any amount paid or accrued as dividends on Preferred
Stock of AGCO or any Restricted Subsidiary owned by Persons other than
AGCO and any of its Restricted Subsidiaries; and
(vi) all extraordinary gains and extraordinary losses.
"Adjusted Consolidated Net Tangible Assets" means the total amount of
assets of AGCO and its Restricted Subsidiaries (less applicable depreciation,
amortization and other valuation reserves), except to the extent resulting from
write-ups of capital assets (excluding write-ups in connection with accounting
for acquisitions in conformity with GAAP), after deducting therefrom:
(i) all current liabilities of AGCO and its Restricted
Subsidiaries (excluding intercompany items); and
(ii) all goodwill, trade names, trade-marks, patents,
unamortized debt discount and expense and other like intangibles, all
as set forth on the most recent quarterly or annual consolidated
balance sheet of AGCO and its Restricted Subsidiaries, prepared in
conformity with GAAP and filed pursuant to the "SEC Reports" covenant.
"Affiliate" means, as applied to any Person, any other Person directly
or indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, 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 the
ownership of voting securities, by contract or otherwise.
"Asset Acquisition" means:
(i) an investment by AGCO or any of its Restricted
Subsidiaries in any other Person pursuant to which such Person shall
become a Restricted Subsidiary or shall be merged into or consolidated
with AGCO or any of its Restricted Subsidiaries; provided that such
Person's primary business is related, ancillary or complementary to the
businesses of AGCO and its Restricted Subsidiaries on the date of such
investment; or
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(ii) an acquisition by AGCO or any of its Restricted
Subsidiaries of the property and assets of any Person other than AGCO
or any of its Restricted Subsidiaries that constitute substantially all
of a division or line of business of such Person; provided that the
property and assets acquired are related, ancillary or complementary to
the businesses of AGCO and its Restricted Subsidiaries on the date of
such acquisition.
"Asset Disposition" means the sale or other disposition by AGCO or any
of its Restricted Subsidiaries (other than to AGCO or another Restricted
Subsidiary) of:
(i) all or substantially all of the Capital Stock of any
Restricted Subsidiary of AGCO; or
(ii) all or substantially all of the assets that
constitute a division or line of business of AGCO or any of its
Restricted Subsidiaries.
"Asset Sale" means any sale, transfer or other disposition (including
by way of merger, consolidation or Sale/Leaseback Transaction) in one
transaction or a series of related transactions by AGCO or any of its Restricted
Subsidiaries to any Person other than AGCO or any of its Restricted Subsidiaries
of:
(i) all or any of the Capital Stock of any Restricted
Subsidiary;
(ii) all or substantially all of the property and assets
of an operating unit or business of AGCO or any of its Restricted
Subsidiaries; or
(iii) any other property and assets of AGCO or any of its
Restricted Subsidiaries (other than the Capital Stock or assets of an
Unrestricted Subsidiary) outside the ordinary course of business of
AGCO or such Restricted Subsidiary and, in each case, that is not
governed by the provisions of the Indenture applicable to mergers,
consolidations and sales of assets of AGCO;
provided that "Asset Sale" shall not include:
(A) sales or other dispositions of inventory, receivables
and other current assets;
(B) sales or other dispositions of assets for
consideration at least equal to the fair market value of the assets
sold or disposed of, provided that the consideration received would
satisfy clause (b)(i)(B) of the "Limitation on Asset Sales" covenant;
(C) a Permitted Investment or a Restricted Payment that
is permitted by the covenant described below under the caption
"Limitation on Restricted Payments";
(D) a single transaction or a series of related
transactions described in clauses (i), (ii) or (iii) above (a) that
have a fair market value of less than $5.0 million or (b) for net
proceeds of less than $5.0 million; or
(E) sales in connection with a Tax Abatement Transaction
permitted by the Indenture.
"Attributable Debt", in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate borne by the Notes, compounded annually) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
such Sale/Leaseback Transaction (including any period for which such lease has
been extended).
"Average Life" means, at any date of determination with respect to any
debt security, the quotient obtained by dividing
(i) the sum of the products of
(A) the number of years from such date of
determination to the dates of each successive scheduled
principal payment of such debt security and
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(B) the amount of such principal payment by
(ii) the sum of all such principal payments.
"Bank Credit Agreement" means the Credit Agreement, dated on or about
the Closing Date, among AGCO and certain Subsidiaries named therein, the lenders
named therein, and Co(sigma)operatieve Centrale Raiffeisen-Boerenleenbank B. A.,
"Rabobank Nederland," New York Branch, as Administrative Agent, together with
all other agreements, instruments and documents (including, without limitation,
guaranty agreements and security agreements) executed or delivered pursuant
thereto or in connection therewith, in each case as such agreements, instruments
or documents may be amended, restated, refinanced, supplemented, extended,
renewed, replaced, expanded or otherwise modified from time to time; provided
that, with respect to any agreement providing for the refinancing of all
Indebtedness under the Bank Credit Agreement, such agreement shall be the Bank
Credit Agreement under the Indenture only if a notice to that effect is
delivered by AGCO to the Trustee; and there shall be at any time only one
instrument that is (together with the aforementioned related agreements,
instruments and documents) the Bank Credit Agreement under the Indenture.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether now outstanding or
issued after the Closing Date, including, without limitation, all Common Stock
and Preferred Stock.
"Capitalized Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligations" means the discounted present value of
the rental obligations under any Capitalized Lease.
"Change of Control" means such time as:
(i) a "person" or "group" (within the meaning of Sections
13(d) and 14(d)(2) of the Exchange Act) becomes the ultimate
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of
Voting Stock representing more than 35% of the total voting power of
the total Voting Stock of AGCO on a fully diluted basis; or
(ii) individuals who on the Closing Date constitute the
Board of Directors (together with any new directors whose election by
the Board of Directors or whose nomination for election by AGCO's
stockholders was approved by a vote of at least a majority of the
members of the Board of Directors then in office who either were
members of the Board of Directors on the Closing Date or whose election
or nomination for election was previously so approved) cease for any
reason to constitute a majority of the members of the Board of
Directors then in office.
"Closing Date" means the date on which the Notes are originally issued
under the Indenture
"Consolidated Cash Flow" means, for any period, the sum of the amounts
for such period of
(i) Adjusted Consolidated Net Income,
(ii) Consolidated Interest Expense, to the extent such
amount was deducted in calculating Adjusted Consolidated Net Income,
(iii) income taxes, to the extent such amount was deducted
in calculating Adjusted Consolidated Net Income (other than income
taxes (either positive or negative) attributable to extraordinary and
non-recurring gains or losses or sales of assets),
(iv) depreciation expense, to the extent such amount was
deducted in calculating Adjusted Consolidated Net Income,
(v) amortization expense, to the extent such amount was
deducted in calculating Adjusted Consolidated Net Income, and
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(vi) all other non-cash items reducing Adjusted
Consolidated Net Income (other than items that will require cash
payments and for which an accrual or reserve is, or is required by GAAP
to be, made), less all non-cash items increasing Adjusted Consolidated
Net Income, all as determined on a consolidated basis for AGCO and its
Restricted Subsidiaries in conformity with GAAP;
provided that, if any Restricted Subsidiary is not a Wholly Owned Restricted
Subsidiary, Consolidated Cash Flow shall be reduced (to the extent not otherwise
reduced in accordance with GAAP) by an amount equal to
(A) the amount of the Adjusted Consolidated Net Income
attributable to such Restricted Subsidiary multiplied by
(B) the quotient of (1) the number of shares of
outstanding Common Stock of such Restricted Subsidiary not owned on the
last day of such period by AGCO or any of its Restricted Subsidiaries
divided by (2) the total number of shares of outstanding Common Stock
of such Restricted Subsidiary on the last day of such period.
"Consolidated Interest Expense" means, for any period, the aggregate
amount of interest in respect of Indebtedness (including amortization of
original issue discount on any Indebtedness and the interest portion of any
deferred payment obligation, calculated in accordance with the effective
interest method of accounting; all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing; the net costs associated with Interest Rate Agreements; and
Indebtedness that is Guaranteed or secured by AGCO or any of its Restricted
Subsidiaries) and all but the principal component of rentals in respect of
Capitalized Lease Obligations paid, accrued or scheduled to be paid or to be
accrued by AGCO and its Restricted Subsidiaries during such period;
excluding, however,
(i) any amount of such interest of any Restricted
Subsidiary if the net income of such Restricted Subsidiary is excluded
in the calculation of Adjusted Consolidated Net Income pursuant to
clause (iii) of the definition thereof (but only in the same proportion
as the net income of such Restricted Subsidiary is excluded from the
calculation of Adjusted Consolidated Net Income pursuant to clause
(iii) of the definition thereof); and
(ii) any premiums, fees and expenses (and any amortization
thereof) payable in connection with the offering of the Notes, all as
determined on a consolidated basis (without taking into account
Unrestricted Subsidiaries) in conformity with GAAP.
"Consolidated Net Worth" means, at any date of determination,
stockholders' equity as set forth on the most recently available quarterly or
annual consolidated balance sheet of AGCO and its Restricted Subsidiaries (which
shall be as of a date not more than 90 days prior to the date of such
computation, and which shall not take into account Unrestricted Subsidiaries),
less any amounts attributable to Redeemable Stock or any equity security
convertible into or exchangeable for Indebtedness, the cost of treasury stock
and the principal amount of any promissory notes receivable from the sale of the
Capital Stock of AGCO or any of its Restricted Subsidiaries, each item to be
determined in conformity with GAAP (excluding the effects of foreign currency
exchange adjustments under Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 52).
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"fair market value" means the price that would be paid in an
arm's-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to buy,
as determined in good faith by the Board of Directors, whose determination shall
be conclusive if evidenced by a Board Resolution.
"Foreign Subsidiary" means any Restricted Subsidiary not created or
organized in the U.S., any state thereof or the District of Columbia that
conducts substantially all of its operations outside of the U.S..
"GAAP" means generally accepted accounting principles in the U.S. of
America as in effect as of the Closing Date, including, without limitation,
those 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 approved by a significant segment of the
accounting profession. All
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ratios and computations contained or referred to in the Indenture shall be
computed in conformity with GAAP applied on a consistent basis, except that
calculations made for purposes of determining compliance with the terms of the
covenants and with other provisions of the Indenture shall be made without
giving effect to (i) the amortization of any expenses incurred in connection
with the offering of the Notes and (ii) except as otherwise provided, the
amortization of any amounts required or permitted by Accounting Principles Board
Opinion Nos. 16 and 17.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person:
(i) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of
such other Person (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise); or
(ii) entered into for purposes of assuring in any other
manner the obligee of such Indebtedness or other obligation of the
payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part);
provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of
business. The term Guarantee used as a verb has a corresponding
meaning.
"Guarantors" means:
(i) each of the Restricted Subsidiaries of AGCO (other
than Foreign Subsidiaries, Massey Ferguson Corp. and AGCO Funding
Corporation) as of the Closing Date; and
(ii) any other Subsidiary that executes a Subsidiary
Guarantee in accordance with the provisions of the Indenture;
and their respective successors and assigns.
"Incur" means, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness, including an "Incurrence" of Indebtedness by reason of a Person
becoming a Restricted Subsidiary of AGCO; provided that neither the accrual of
interest nor the accretion of original issue discount shall be considered an
Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication):
(i) all indebtedness of such Person for borrowed money;
(ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments (other than any
non-negotiable notes issued to insurance carriers in lieu of
maintenance of policy reserves in connection with workers' compensation
and liability insurance programs);
(iii) all obligations of such Person in respect of letters
of credit or other similar instruments (including reimbursement
obligations with respect thereto, but excluding obligations with
respect to letters of credit (including trade letters of credit)
securing obligations (other than obligations described in clauses (i)
or (ii) above or clauses (v), (vi) or (vii) below) entered into in the
ordinary course of business of such Person to the extent such letters
of credit are not drawn upon or, if drawn upon, to the extent such
drawing is reimbursed no later than the third Business Day following
receipt by such Person of a demand for reimbursement);
(iv) all obligations of such Person to pay the deferred
and unpaid purchase price of property or services, which purchase price
is due more than six months after the date of placing such property in
service or taking delivery and title thereto or the completion of such
services, except Trade Payables;
(v) all obligations of such Person as lessee under
Capitalized Leases;
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(vi) all Indebtedness of other Persons secured by a Lien
on any asset of such Person, whether or not such Indebtedness is
assumed by such Person; provided that the amount of such Indebtedness
shall be the lesser of (A) the fair market value of such asset at such
date of determination and (B) the amount of such Indebtedness;
(vii) all Indebtedness of other Persons Guaranteed by such
Person to the extent such Indebtedness is Guaranteed by such Person;
and
(viii) to the extent not otherwise included in this
definition, obligations under Currency Agreements and Interest Rate
Agreements.
The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and, with respect to contingent obligations, the maximum liability upon
the occurrence of the contingency giving rise to the obligation, provided that:
(A) the amount outstanding at any time of any
Indebtedness issued with original issue discount is the face amount of
such Indebtedness; and
(B) Indebtedness shall not include (1) any liability for
federal, state, local or other taxes or (2) any obligations of such
Person pursuant to Receivables Programs to the extent such obligations
are nonrecourse to such Person and its Subsidiaries.
"Interest Coverage Ratio" means, on any Transaction Date, the ratio of
(i) the aggregate amount of Consolidated Cash Flow for
the then most recent four fiscal quarters prior to such Transaction
Date for which reports have been filed with the SEC pursuant to the
"SEC Reports and Reports to Holders" covenant (the "Four Quarter
Period") to
(ii) the aggregate Consolidated Interest Expense during
such Four Quarter Period.
In making the foregoing calculation:
(A) pro forma effect shall be given to any Indebtedness
Incurred or repaid during the period (the "Reference Period")
commencing on the first day of the Four Quarter Period and ending on
the Transaction Date (other than Indebtedness Incurred or repaid under
a revolving credit or similar arrangement to the extent of the
commitment thereunder (or under any predecessor revolving credit or
similar arrangement) in effect on the last day of such Four Quarter
Period unless any portion of such Indebtedness is projected, in the
reasonable judgment of the senior management of AGCO, to remain
outstanding for a period in excess of 12 months from the date of the
Incurrence thereof), in each case as if such Indebtedness had been
Incurred or repaid on the first day of such Reference Period;
(B) Consolidated Interest Expense attributable to
interest on any Indebtedness (whether existing or being Incurred)
computed on a pro forma basis and bearing a floating interest rate
shall be computed as if the rate in effect on the Transaction Date
(taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in
excess of 12 months or, if shorter, at least equal to the remaining
term of such Indebtedness) had been the applicable rate for the entire
period;
(C) pro forma effect shall be given to Asset Dispositions
and Asset Acquisitions (including giving pro forma effect to the
application of proceeds of any Asset Disposition) that occur during
such Reference Period as if they had occurred and such proceeds had
been applied on the first day of such Reference Period; and
(D) pro forma effect shall be given to asset dispositions
and asset acquisitions (including giving pro forma effect to the
application of proceeds of any asset disposition) that have been made
by any Person that has become a Restricted Subsidiary or has been
merged with or into AGCO or any Restricted Subsidiary during such
Reference Period and that would have constituted Asset Dispositions or
Asset Acquisitions had such transactions occurred when such Person was
a Restricted Subsidiary as if such asset dispositions or asset
acquisitions were Asset Dispositions or Asset Acquisitions that
occurred on the first day of such Reference Period;
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provided that to the extent that clause (C) or (D) of this sentence requires
that pro forma effect be given to an Asset Acquisition or Asset Disposition,
such pro forma calculation shall be based upon the four full fiscal quarters
immediately preceding the Transaction Date of the Person, or division or line of
business of the Person, that is acquired or disposed for which financial
information is available.
"Investment" in any Person means any direct or indirect advance, loan
or other extension of credit (including, without limitation, by way of Guarantee
or similar arrangement; but excluding advances to customers in the ordinary
course of business that are, in conformity with GAAP, recorded as accounts
receivable on the balance sheet of AGCO or its Restricted Subsidiaries) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, bonds, notes,
debentures or other similar instruments issued by, such Person and shall
include:
(i) the designation of a Restricted Subsidiary as an
Unrestricted Subsidiary; and
(ii) the fair market value of the Capital Stock (or any
other Investment), held by AGCO or any of its Restricted Subsidiaries,
of (or in) any Person that has ceased to be a Restricted Subsidiary,
including, without limitation, by reason of any transaction permitted
by clause (iii) of the "Limitation on the Issuance and Sale of Capital
Stock of Restricted Subsidiaries" covenant; provided, however, that
appreciation in the value of an Investment previously permitted by the
terms of the Indenture shall not of itself constitute an Investment.
For purposes of the definition of "Unrestricted Subsidiary" and the
"Limitation on Restricted Payments" covenant described below:
(A) "Investment" shall include the fair market value of
the assets (net of liabilities (other than liabilities to AGCO or any
of its Restricted Subsidiaries)) of any Restricted Subsidiary at the
time that such Restricted Subsidiary is designated an Unrestricted
Subsidiary;
(B) the fair market value of the assets (net of
liabilities (other than liabilities to AGCO or any of its Restricted
Subsidiaries)) of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary shall be
considered a reduction in outstanding Investments; and
(C) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including, without limitation, any conditional sale or
other title retention agreement or lease in the nature thereof or any agreement
to give any security interest to the extent that the obligation to do so has
arisen).
"Moody's" means Moody's Investors Service, Inc. and its successors.
"Net Cash Proceeds" means:
(i) with respect to any Asset Sale, the proceeds of such
Asset Sale in the form of cash or cash equivalents, including payments
in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in
the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to AGCO or any
Restricted Subsidiary) and proceeds from the conversion of other
property received when converted to cash or cash equivalents, net of:
(A) brokerage commissions and other fees and
expenses (including fees and expenses of counsel and
investment bankers) related to such Asset Sale;
(B) provisions for all taxes (whether or not
such taxes will actually be paid or are payable) as a result
of such Asset Sale without regard to the consolidated results
of operations of AGCO and its Restricted Subsidiaries, taken
as a whole;
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(C) payments made to repay Indebtedness or any
other obligation outstanding at the time of such Asset Sale
that either (1) is secured by a Lien on the property or assets
sold or (2) is required to be paid as a result of such sale;
and
(D) appropriate amounts to be provided by AGCO
or any Restricted Subsidiary of AGCO as a reserve against any
liabilities associated with such Asset Sale, including,
without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated
with such Asset Sale, all as determined in conformity with
GAAP; and
(ii) with respect to any issuance or sale of Capital
Stock, the proceeds of such issuance or sale in the form of cash or
cash equivalents, including payments in respect of deferred payment
obligations (to the extent corresponding to the principal, but not
interest, component thereof) when received in the form of cash or cash
equivalents (except to the extent such obligations are financed or sold
with recourse to AGCO or any Restricted Subsidiary) and proceeds from
the conversion of other property received when converted to cash or
cash equivalents, net of attorney's fees, accountants' fees,
underwriters' or placement agents' fees, discounts or commissions and
brokerage, consultant and other fees incurred in connection with such
issuance or sale and net of taxes paid or payable as a result thereof.
"Offer to Purchase" means an offer to purchase Notes by AGCO from the
Holders commenced by mailing a notice to the Trustee and each Holder stating:
(i) the covenant pursuant to which the offer is being
made and that all Notes validly tendered will be accepted for payment
on a pro rata basis;
(ii) the purchase price and the date of purchase (which
shall be a Business Day no earlier than 30 days nor later than 60 days
from the date such notice is mailed) (the "Payment Date");
(iii) that any Note not tendered will continue to accrue
interest pursuant to its terms;
(iv) that, unless AGCO defaults in the payment of the
purchase price, any Note accepted for payment pursuant to the Offer to
Purchase shall cease to accrue interest on and after the Payment Date;
(v) that Holders electing to have a Note purchased
pursuant to the Offer to Purchase will be required to surrender the
Note, together with the form entitled "Option of the Holder to Elect
Purchase" on the reverse side of the Note completed, to the Paying
Agent at the address specified in the notice prior to the close of
business on the Business Day immediately preceding the Payment Date;
(vi) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close of
business on the third Business Day immediately preceding the Payment
Date, a telegram, facsimile transmission or letter setting forth the
name of such Holder, the principal amount of Notes delivered for
purchase and a statement that such Holder is withdrawing his election
to have such Notes purchased; and
(vii) that Holders whose Notes are being purchased only in
part will be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered; provided that each Note
purchased and each new Note issued shall be in a principal amount of
$1,000 or integral multiples thereof.
On the Payment Date, AGCO shall:
(A) accept for payment on a pro rata basis Notes or
portions thereof tendered pursuant to an Offer to Purchase;
(B) deposit with the Paying Agent money sufficient to pay
the purchase price of all Notes or portions thereof so accepted; and
(C) deliver, or cause to be delivered, to the Trustee all
Notes or portions thereof so accepted together with an Officers'
Certificate specifying the Notes or portions thereof accepted for
payment by AGCO.
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The Paying Agent shall promptly mail to the Holders of Notes so
accepted payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail to such Holders a new Note equal in principal
amount to any unpurchased portion of the Note surrendered; provided that each
Note purchased and each new Note issued shall be in a principal amount of $1,000
or integral multiples thereof. AGCO will publicly announce the results of an
Offer to Purchase as soon as practicable after the Payment Date. The Trustee
shall act as the Paying Agent for an Offer to Purchase. AGCO will comply with
Rule 14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable, in the event
that AGCO is required to repurchase Notes pursuant to an Offer to Purchase.
"Permitted Investment" means:
(i) subject to the limitations described in the
"Additional Subsidiary Guarantees" covenant, an Investment in AGCO or a
Restricted Subsidiary or a Person which will, upon the making of such
Investment, become a Restricted Subsidiary or be merged or consolidated
with or into or transfer or convey all or substantially all its assets
to, AGCO or a Restricted Subsidiary; provided that such person's
primary business is related, ancillary or complementary to the
businesses of AGCO and its Restricted Subsidiaries on the date of such
Investment;
(ii) Temporary Cash Investments;
(iii) payroll, travel and similar advances to cover matters
that are expected at the time of such advances ultimately to be treated
as expenses in accordance with GAAP;
(iv) loans or advances to employees made in the ordinary
course of business in accordance with past practice of AGCO or its
Restricted Subsidiaries and that do not in the aggregate exceed $3
million at any time outstanding;
(v) stock, obligations or securities received in
satisfaction of judgments;
(vi) any Investment acquired as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and
in compliance with the covenant described below under the caption
"Limitation on Asset Sales"; and
(vii) any Investment in bonds in connection with a Tax
Abatement Transaction.
"Permitted Liens" means:
(i) Liens on assets of AGCO and its Restricted
Subsidiaries, whether owned on the Closing Date or thereafter acquired,
securing all Indebtedness under the Bank Credit Agreement;
(ii) Liens in favor of AGCO or a Restricted Subsidiary;
(iii) Liens to secure the performance of statutory
obligations, surety or appeal bonds, performance bonds or other
obligations of a like nature incurred in the ordinary course of
business;
(iv) Liens on assets of Restricted Subsidiaries to secure
Indebtedness of Restricted Subsidiaries that was permitted by the terms
of the Indenture to be incurred;
(v) Liens existing on the Closing Date;
(vi) Liens for taxes, assessments or governmental charges
or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and
diligently conducted; provided that any reserve or other appropriate
provision as shall be required in conformity with GAAP shall have been
made therefor;
(vii) Liens on receivables, payment intangibles and related
property to reflect sales of receivables or payment intangibles
pursuant to a Receivables Program;
(viii) Liens encumbering customary initial deposits and
margin deposits, and other Liens that are either within the general
parameters customary in the industry and incurred in the ordinary
course of business, in each case, securing
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Indebtedness under Interest Rate Agreements and Currency Agreements and
forward contracts, options, future contracts, future options or similar
agreements or arrangements designed solely to protect AGCO or any of
its Restricted Subsidiaries from fluctuations in interest rates,
currencies or the price of commodities;
(ix) Liens encumbering property or assets under
construction arising from progress or partial payments by a customer of
AGCO or its Restricted Subsidiaries relating to such property or
assets;
(x) Liens on property of, or on shares of stock or
Indebtedness of, any Person existing at the time such Person becomes,
or becomes a part of, any Restricted Subsidiary; provided that such
Liens do not extend to or cover any property or assets of AGCO or any
Restricted Subsidiary other than the property or assets acquired;
(xi) Liens securing reimbursement obligations with respect
to letters of credit that encumber documents and other property
relating to such letters of credit and the products and proceeds
thereof;
(xii) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;
(xiii) Liens arising out of conditional sale, title
retention, consignment or similar arrangements for the sale of goods
entered into by AGCO or any of its Restricted Subsidiaries in the
ordinary course of business in accordance with the past practices of
AGCO and its Restricted Subsidiaries prior to the Closing Date;
(xiv) Liens securing Indebtedness which is Incurred to
refinance Secured Indebtedness which is permitted to be Incurred under
clause (iii) of paragraph (b) of the "Limitation on Indebtedness"
covenant; provided that such Liens do not extend to or cover any
property or assets of AGCO or any Restricted Subsidiary other than the
property or assets securing the Indebtedness being refinanced;
(xv) Liens (including extensions and renewals thereof)
upon real or personal property acquired after the Closing Date;
provided that (A) such Lien is created solely for the purpose of
securing Indebtedness Incurred, in accordance with the "Limitation on
Indebtedness" covenant described below, (1) to finance the cost
(including the cost of improvement or construction) of the item of
property or assets subject thereto and such Lien is created prior to,
at the time of or within six months after the later of the acquisition,
the completion of construction or the commencement of full operation of
such property or (2) to refinance any Indebtedness previously so
secured, (B) the principal amount of the Indebtedness secured by such
Lien does not exceed 100% of such cost and (C) any such Lien shall not
extend to or cover any property or assets other than such item of
property or assets and any improvements on such item;
(xvi) Liens to secure Attributable Debt in respect of a
Sale/Leaseback Transaction that was permitted by the terms of the
Indenture to be entered into;
(xvii) any interest or title of a lessor in the property
subject to any Capitalized Lease or operating lease; and
(xviii) Liens arising from filing Uniform Commercial Code
financing statements regarding leases.
"Receivables Program" means, with respect to any Person, any accounts
receivable securitization or factoring program pursuant to which such Person
receives proceeds pursuant to a pledge, sale or other encumbrance of its
accounts receivable or payment intangibles.
"Redeemable Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is:
(i) required to be redeemed prior to the Stated Maturity
of the Notes;
(ii) redeemable at the option of the holder of such class
or series of Capital Stock at any time prior to the Stated Maturity of
the Notes; or
(iii) convertible into or exchangeable for Capital Stock
referred to in clause (i) or (ii) above or Indebtedness having a
scheduled maturity prior to the Stated Maturity of the Notes;
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provided that any Capital Stock that would not constitute Redeemable Stock but
for provisions thereof giving holders thereof the right to require such Person
to repurchase or redeem such Capital Stock upon the occurrence of an "asset
sale" or "change of control" occurring prior to the Stated Maturity of the Notes
shall not constitute Redeemable Stock if the "asset sale" or "change of control"
provisions applicable to such Capital Stock are no more favorable to the holders
of such Capital Stock than the provisions contained in the "Limitation on Asset
Sales" and "Repurchase of Notes Upon a Change of Control" covenants described
below and such Capital Stock specifically provides that such Person will not
repurchase or redeem any such stock pursuant to such provision prior to AGCO's
repurchase of such Notes as are required to be repurchased pursuant to the
"Limitation on Asset Sales" and "Repurchase of Notes Upon a Change of Control"
covenants described below.
"Restricted Subsidiary" means any Subsidiary of AGCO other than an
Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an agreement relating to property
now owned or hereafter acquired whereby AGCO or a Restricted Subsidiary
transfers such property to a Person and AGCO or a Restricted Subsidiary leases
it back from such Person, provided that Sale/Leaseback Transaction shall not
include any Tax Abatement Transaction.
"Secured Indebtedness" means any Indebtedness of AGCO secured by a
Lien.
"Senior Indebtedness" means:
(i) Indebtedness of AGCO, whether outstanding on the
Closing Date or thereafter Incurred; and
(ii) accrued and unpaid interest (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to AGCO to the extent post-filing interest is
allowed in such proceeding) in respect of (A) indebtedness of AGCO for
money borrowed and (B) indebtedness evidenced by notes, debentures,
bonds or other similar instruments for the payment of which AGCO is
responsible or liable, unless, in the case of clauses (i) and (ii) in
the instrument creating or evidencing the same or pursuant to which the
same is outstanding, it is provided that such obligations are
subordinate in right of payment to the Notes; provided, however, that
Senior Indebtedness shall not include:
(A) any obligation of AGCO to any Subsidiary;
(B) any liability for Federal, state, local or
other taxes owed or owing by AGCO;
(C) any accounts payable or other liability to
trade creditors arising in the ordinary course of business
(including guarantees thereof or instruments evidencing such
liabilities);
(D) any Indebtedness of AGCO (and any accrued
and unpaid interest in respect thereof) which is subordinate
or junior in any respect to any other Indebtedness or other
obligation of AGCO; or
(E) that portion of any Indebtedness which at
the time of Incurrence is Incurred in violation of the
Indenture.
"Senior Subordinated Obligations" means any principal of, premium, if
any, or interest on AGCO's 8 1/2% Senior Subordinated Notes due 2006 (the
"Subordinated Notes") payable pursuant to the terms of such Subordinated Notes
or upon acceleration, including any amounts received upon the exercise of rights
of recision or other rights of action (including claims for damages) or
otherwise, to the extent relating to the purchase price of the Subordinated
Notes or amounts corresponding to such principal, premium, if any, or interest
on the Subordinated Notes.
"Significant Subsidiary" means, at any date of determination, any
Restricted Subsidiary that, together with its Subsidiaries:
(i) for the most recent fiscal year of AGCO, accounted
for more than 10% of the consolidated revenues of AGCO and its
Restricted Subsidiaries; or
(ii) as of the end of such fiscal year, was the owner of
more than 10% of the consolidated assets of AGCO and its Restricted
Subsidiaries;
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all as set forth on the most recently available consolidated financial
statements of AGCO for such fiscal year.
"S&P" means Standard & Poor's Ratings Service, a division of The McGraw
Hill Companies, and its successors.
"Stated Maturity" means:
(i) with respect to any debt security, the date specified
in such debt security as the fixed date on which the final installment
of principal of such debt security is due and payable; and
(ii) with respect to any scheduled installment of
principal of or interest on any debt security, the date specified in
such debt security as the fixed date on which such installment is due
and payable.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.
"Subsidiary Guarantee" means the guarantee of the obligations of AGCO
with respect to the Notes and the Indenture by each Guarantor pursuant to the
terms of the Indenture.
"Tax Abatement Transaction" means any revenue bond financing
arrangement between any Person and a development authority or other similar
governmental authority or entity for the purpose of providing ad valorem
property tax abatement to such Person whereby (i) the development authority
issues revenue bonds to finance the acquisition of property that is now owned or
hereafter acquired by AGCO or a Restricted Subsidiary, (ii) the property so
transferred is leased back by AGCO or such Restricted Subsidiary, (iii) the
bonds issued to finance the acquisition are owned by AGCO or a Restricted
Subsidiary, (iv) the rental payments on the lease and the debt service payments
on the bonds are substantially equal and (v) AGCO or such Restricted Subsidiary
has the option to prepay the bonds, terminate its lease and reacquire the
property for nominal consideration at any time; provided that if at any time any
of the foregoing conditions shall cease to be satisfied, such transaction shall
cease to be a Tax Abatement Transaction and the transaction must satisfy the
"Limitation on Sale/Leaseback Transactions" covenant.
"Temporary Cash Investment" means any of the following:
(i) direct obligations of the U.S. of America or any
agency thereof or obligations fully and unconditionally guaranteed by
the U.S. of America or any agency thereof;
(ii) time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of
acquisition thereof issued by a bank or trust company which is
organized under the laws of the U.S. of America, any state thereof or
any foreign country recognized by the U.S., and which bank or trust
company has capital, surplus and undivided profits aggregating in
excess of $50 million (or the foreign currency equivalent thereof) and
has outstanding debt which is rated "A" (or such similar equivalent
rating) or higher by at least one nationally recognized statistical
rating organization (as defined in Rule 436 under the Securities Act)
or any money-market fund sponsored by a registered broker dealer or
mutual fund distributor;
(iii) repurchase obligations with a term of not more than
30 days for underlying securities of the types described in clause (i)
above entered into with a bank meeting the qualifications described in
clause (ii) above;
(iv) commercial paper, maturing not more than 90 days
after the date of acquisition, issued by a corporation (other than an
Affiliate of AGCO) organized and in existence under the laws of the
U.S. of America, any state thereof or any foreign country recognized by
the U.S. of America with a rating at the time as of which any
investment therein is made of "P-1" (or higher) according to Moody's or
"A-1" (or higher) according to S&P; and
(v) securities with maturities of six months or less from
the date of acquisition issued or fully and unconditionally guaranteed
by any state, commonwealth or territory of the U.S. of America, or by
any political subdivision or taxing authority thereof, and rated at
least "A" by S&P or Moody's.
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"Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services.
"Transaction Date" means, with respect to the Incurrence of any
Indebtedness by AGCO or any of its Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment, the
date such Restricted Payment is to be made.
"Unrestricted Subsidiary" means:
(i) AGCO Acceptance Corporation and its successors,
provided in the case of any such successor that the property and assets
of such successor at the time it becomes an Unrestricted Subsidiary do
not include any property or assets of AGCO or any of its Restricted
Subsidiaries;
(ii) any Subsidiary of AGCO that at the time of
determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below; and
(iii) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Restricted Subsidiary
(including any newly acquired or newly formed Subsidiary of AGCO) to be an
Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, AGCO or any Restricted Subsidiary;
provided that:
(A) any Guarantee by AGCO or any Restricted Subsidiary of
any Indebtedness of the Subsidiary being so designated shall be deemed
an "Incurrence" of such Indebtedness by AGCO or such Restricted
Subsidiary (or both, if applicable) at the time of such designation;
(B) either (1) the Subsidiary to be so designated has
total assets of $1,000 or less or (2) if such Subsidiary has assets
greater than $1,000, such designation would be permitted under the
"Limitation on Restricted Payments" covenant described below and
(C) if applicable, the Incurrence of Indebtedness
referred to in clause (A) of this proviso would be permitted under the
"Limitation on Indebtedness" covenant described below.
The Board of Directors may designate any Unrestricted Subsidiary to be
a Restricted Subsidiary; provided that immediately after giving effect to such
designation
(x) AGCO could Incur $1.00 of additional Indebtedness
under paragraph (a) of the "Limitation on Indebtedness" covenant
described below and
(y) no Default or Event of Default shall have occurred
and be continuing.
Any such designation by the Board of Directors shall be evidenced to
the Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing provisions.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"Wholly Owned" means, with respect to any Subsidiary of any Person, the
ownership of all of the outstanding Capital Stock of such Subsidiary (other than
any director's qualifying shares or Investments by foreign nationals mandated by
applicable law) by such Person or one or more Wholly Owned Subsidiaries of such
Person.
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COVENANTS
Limitation on Indebtedness
(a) AGCO will not, and will not permit any of its Restricted
Subsidiaries to, Incur any Indebtedness (other than the Notes, the Subsidiary
Guarantees and Indebtedness existing on the Closing Date); provided that AGCO or
any of its Restricted Subsidiaries that is or, upon such incurrence, becomes a
Guarantor may Incur Indebtedness (including, without limitation, Acquired
Indebtedness), and any Restricted Subsidiary that is not a Guarantor may Incur
Acquired Indebtedness, if, after giving effect to the Incurrence of such
Indebtedness and the receipt and application of the proceeds therefrom, the
Interest Coverage Ratio would be greater than 3.0:1.
(b) Notwithstanding the foregoing paragraph (a), AGCO and any
Restricted Subsidiary (except as specified below) may Incur each and all of the
following:
(i) Indebtedness outstanding at any time in an aggregate
principal amount not to exceed an amount equal to the greater of (A)
$500 million, less any amount of Indebtedness permanently repaid as
provided under the "Limitation on Asset Sales" covenant described below
and (B) the sum of (1) 90% of the consolidated book value of the
accounts receivable (other than accounts receivable subject to a
Receivables Program) of AGCO and its Restricted Subsidiaries plus (2)
60% of the consolidated book value of the inventory of AGCO and its
Restricted Subsidiaries, in each case determined in accordance with
GAAP;
(ii) Indebtedness (A) to AGCO evidenced by a promissory
note or (B) to any of its Restricted Subsidiaries; provided that any
event which results in any such Restricted Subsidiary ceasing to be a
Restricted Subsidiary or any subsequent transfer of such Indebtedness
(other than to AGCO or another Restricted Subsidiary) shall be deemed,
in each case, to constitute an Incurrence of such Indebtedness not
permitted by this clause (ii);
(iii) Indebtedness issued in exchange for, or the net
proceeds of which are used to refinance or refund, then outstanding
Indebtedness, other than Indebtedness Incurred under clause (i), (ii),
(iv), (vi) or (vii) of this paragraph (b), and any refinancings thereof
in an amount not to exceed the amount so refinanced or refunded (plus
premiums, accrued interest, fees and expenses); provided that (A) in
case the Indebtedness to be refinanced is subordinated in right of
payment to the Notes, such new Indebtedness, by its terms or by the
terms of any agreement or instrument pursuant to which such new
Indebtedness is issued or remains outstanding, is expressly made
subordinate in right of payment to the Notes at least to the extent
that the Indebtedness to be refinanced is subordinated to the Notes and
(B) such new Indebtedness, determined as of the date of Incurrence of
such new Indebtedness, does not mature prior to the Stated Maturity of
the Indebtedness to be refinanced or refunded, and the Average Life of
such new Indebtedness is at least equal to the remaining Average Life
of the Indebtedness to be refinanced or refunded; and provided further
that in no event may Indebtedness of AGCO be refinanced by means of any
Indebtedness of any Restricted Subsidiary pursuant to this clause
(iii);
(iv) Indebtedness (A) in respect of performance, surety or
appeal bonds provided in the ordinary course of business, (B) under
Currency Agreements and Interest Rate Agreements; provided that such
agreements (1) are designed solely to protect AGCO and its Restricted
Subsidiaries against fluctuations in foreign currency exchange rates or
interest rates and (2) do not increase the Indebtedness of the obligor
outstanding at any time other than as a result of fluctuations in
foreign currency exchange rates or interest rates or by reason of fees,
indemnities and compensation payable thereunder, and (C) arising from
agreements providing for indemnification, adjustment of purchase price
or similar obligations, or from Guarantees or letters of credit, surety
bonds or performance bonds securing any obligations of AGCO or any of
its Restricted Subsidiaries pursuant to such agreements, in any case
Incurred in connection with the disposition of any business, assets or
Restricted Subsidiary of AGCO (other than Guarantees of Indebtedness
Incurred by any Person acquiring all or any portion of such business,
assets or Restricted Subsidiary of AGCO for the purpose of financing
such acquisition), in a principal amount not to exceed the gross
proceeds actually received by AGCO or any Restricted Subsidiary in
connection with such disposition;
(v) Indebtedness of AGCO, to the extent the net proceeds
thereof are promptly used to purchase Notes or Senior Subordinated
Obligations tendered in an Offer to Purchase made as a result of a
Change of Control; provided that any Indebtedness incurred pursuant to
this clause (v) with respect to the payment of Senior Subordinated
Obligations (A) shall be expressly made subordinate in right of payment
to the Notes and (B) shall not mature prior to the Stated Maturity of
the
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Senior Subordinated Obligations, and shall have an Average Life
that is at least equal to the remaining Average Life of the Senior
Subordinated Obligations;
(vi) Indebtedness of AGCO, to the extent the net proceeds
thereof are promptly deposited to defease the Notes as described below
under "Defeasance";
(vii) Guarantees of Indebtedness of AGCO by any Restricted
Subsidiary provided the Guarantee of such Indebtedness is permitted by
and made in accordance with the "Limitation on Issuance of Guarantees
by Restricted Subsidiaries" covenant described below; and
(viii) Indebtedness Incurred in connection with a Tax
Abatement Transaction.
(c) Notwithstanding any other provision of this "Limitation on
Indebtedness" covenant, the maximum amount of Indebtedness that AGCO or a
Restricted Subsidiary may Incur pursuant to this "Limitation on Indebtedness"
covenant shall not be deemed to be exceeded, with respect to any outstanding
Indebtedness, due solely to the result of fluctuations in the exchange rates of
currencies.
(d) For purposes of determining any particular amount of
Indebtedness under this "Limitation on Indebtedness" covenant,
(i) Indebtedness Incurred under the Bank Credit Agreement
on or prior to the Closing Date shall be treated as Incurred pursuant
to clause (i) of paragraph (b) of this "Limitation on Indebtedness"
covenant;
(ii) Guarantees, Liens or obligations with respect to
letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included; and
(iii) any Liens granted pursuant to the equal and ratable
provisions referred to in the "Limitation on Liens" covenant described
below shall not be treated as Indebtedness.
For purposes of determining compliance with this "Limitation on Indebtedness"
covenant, in the event that an item of Indebtedness meets the criteria of more
than one of the types of Indebtedness described in the above clauses (other than
Indebtedness referred to in clause (i) of paragraph (d) of this "Limitation on
Indebtedness" covenant), AGCO, in its sole discretion, shall classify such item
of Indebtedness and only be required to include the amount and type of such
Indebtedness in one of such clauses.
Limitation on Restricted Payments
(a) AGCO will not, and will not permit any Restricted Subsidiary
to, directly or indirectly:
(i) declare or pay any dividend or make any distribution
on its Capital Stock (other than (A) dividends or distributions payable
solely in shares of its Capital Stock (other than Redeemable Stock) or
in options, warrants or other rights to acquire shares of such Capital
Stock and (B) pro rata dividends or distributions on Common Stock of
Restricted Subsidiaries held by minority stockholders, provided that
such dividends do not in the aggregate exceed the minority
stockholders' pro rata share of such Restricted Subsidiaries' net
income from the first day of the fiscal quarter beginning immediately
following the Closing Date) held by Persons other than AGCO or any of
its Wholly Owned Restricted Subsidiaries;
(ii) purchase, redeem, retire or otherwise acquire for
value any shares of Capital Stock of (x) AGCO or an Unrestricted
Subsidiary (including options, warrants or other rights to acquire such
shares of Capital Stock) held by any Person or (y) a Restricted
Subsidiary (including options, warrants or other rights to acquire such
shares of Capital Stock) held by any Affiliate of AGCO (other than a
Wholly Owned Restricted Subsidiary) or any holder (or any Affiliate of
such holder) of 5% or more of the Capital Stock of AGCO;
(iii) make any voluntary or optional principal payment, or
voluntary or optional redemption, repurchase, defeasance, or other
acquisition or retirement for value, of Indebtedness of AGCO that is
subordinated in right of payment to
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the Notes (other than the purchase, repurchase or acquisition of
Indebtedness in anticipation of satisfying a sinking fund obligation,
principal installment or final maturity, in any case due within one
year of the date of acquisition); or
(iv) make any Investment, other than a Permitted
Investment, in any Person (such payments or any other actions described
in clauses (i) through (iv) of this paragraph (a) being collectively
"Restricted Payments")
if, at the time of, and after giving effect to, the proposed Restricted Payment:
(A) a Default or Event of Default shall have occurred and
be continuing;
(B) AGCO could not Incur at least $1.00 of Indebtedness
under paragraph (a) of the "Limitation on Indebtedness" covenant; or
(C) the aggregate amount of all Restricted Payments (the
amount, if other than in cash, to be determined in good faith by the
Board of Directors, whose determination shall be conclusive and
evidenced by a Board Resolution) made after the Closing Date shall
exceed the sum of
(1) 50% of the aggregate amount of the Adjusted
Consolidated Net Income (or, if the Adjusted Consolidated Net Income is
a loss, minus 100% of the amount of such loss) (determined by excluding
income resulting from transfers of assets by AGCO or a Restricted
Subsidiary to an Unrestricted Subsidiary) accrued on a cumulative basis
during the period (taken as one accounting period) beginning on the
first day of the fiscal quarter beginning immediately following the
Closing Date and ending on the last day of the last fiscal quarter
preceding the Transaction Date for which reports have been filed
pursuant to the "SEC Reports and Reports to Holders" covenant,
(2) the aggregate Net Cash Proceeds received by AGCO
after the Closing Date from the issuance and sale permitted by the
Indenture of its Capital Stock (other than Redeemable Stock) to a
Person who is not a Subsidiary of AGCO, including an issuance or sale
permitted by the Indenture of Indebtedness of AGCO for cash subsequent
to the Closing Date upon the conversion of such Indebtedness into
Capital Stock (other than Redeemable Stock) of AGCO, or from the
issuance to a Person who is not a Subsidiary of AGCO of any options,
warrants or other rights to acquire Capital Stock of AGCO (in each
case, exclusive of any Redeemable Stock or any options, warrants or
other rights that are redeemable at the option of the holder, or are
required to be redeemed, prior to the Stated Maturity of the Notes),
(3) an amount equal to the net reduction in Investments
(other than reductions in Permitted Investments) in any Person
resulting from payments of interest on Indebtedness, dividends,
repayments of loans or advances, or other transfers of assets, in each
case to AGCO or any Restricted Subsidiary or from the Net Cash Proceeds
from the sale of any such Investment (except, in each case, to the
extent any such payment or proceeds are included in the calculation of
Adjusted Consolidated Net Income), or from redesignations of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued in each
case as provided in the definition of "Investments"), not to exceed, in
each case, the amount of Investments previously made by AGCO or any
Restricted Subsidiary in such Person or Unrestricted Subsidiary and
(4) $25 million.
(b) Notwithstanding the foregoing, AGCO may declare or pay any
dividend if:
(i) the dividend relates to Common Stock that is listed
on a national securities exchange or Nasdaq or AGCO's Series A
Convertible Preferred Stock outstanding on the Closing Date;
(ii) no Default or Event of Default has occurred and is
continuing;
(iii) AGCO could have paid the dividend pursuant to clause
(C) of the immediately preceding paragraph (a); and
(iv) the aggregate amount of dividends paid by AGCO in any
fiscal year pursuant to this paragraph (b) does not exceed $5 million.
(c) The restrictions contained in paragraph (a) of this section
shall not be violated by reason of:
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(i) the payment of any dividend within 60 days after the
date of declaration thereof if, at such date of declaration, such
payment would comply with the foregoing paragraph (b);
(ii) the redemption, repurchase, defeasance or other
acquisition or retirement for value of Indebtedness that is
subordinated in right of payment to the Notes including premium, if
any, and accrued and unpaid interest, with the proceeds of, or in
exchange for, Indebtedness Incurred under clause (iii) of paragraph (b)
of the "Limitation on Indebtedness" covenant;
(iii) the repurchase, redemption or other acquisition of
Capital Stock of AGCO (or options, warrants or other rights to acquire
such Capital Stock) in exchange for, or out of the proceeds of a
substantially concurrent offering of, shares of Capital Stock (other
than Redeemable Stock) of AGCO;
(iv) the making of any principal payment or the
repurchase, redemption, retirement, defeasance or other acquisition for
value of Indebtedness of AGCO which is subordinated in right of payment
to the Notes in exchange for, or out of the proceeds of a substantially
concurrent offering of, shares of the Capital Stock of AGCO (other than
Redeemable Stock);
(v) payments or distributions to dissenting stockholders
pursuant to applicable law pursuant to or in connection with a
consolidation, merger or transfer of assets that complies with the
provisions of the Indenture applicable to mergers, consolidations and
transfers of all or substantially all of the property and assets of
AGCO;
(vi) the repurchase of shares, or options to purchase
shares, of Capital Stock of AGCO from employees, former employees,
directors or former directors of AGCO or any of its Subsidiaries (or
permitted transferees of such employees, former employees, directors or
former directors), pursuant to the terms of agreements (including
employment agreements) or plans (or amendments thereto) approved by the
Board of Directors under which such persons purchase or sell or are
granted the option to purchase or sell, shares of such stock; provided,
however, that the aggregate amount of such repurchases shall not exceed
$2 million in any calendar year (unless such repurchases are made with
the proceeds of insurance policies and the shares of Capital Stock are
repurchased from the executors, administrators, testamentary trustees,
heirs, legatees or beneficiaries) plus the aggregate Net Cash Proceeds
from any reissuance during such calendar year of Capital Stock to
employees or directors of AGCO or its Subsidiaries; and provided
further, however, that to the extent less than $2 million of
repurchases of Capital Stock are paid in any calendar year pursuant to
this clause (vi) (without taking into account repurchases from proceeds
of insurance policies or Net Cash Proceeds from reissuances as
described above), the unused portion may be carried forward and paid in
any subsequent calendar year;
(vii) any purchase of any fractional share of Common Stock
of AGCO resulting from (A) any dividend or other distribution on
outstanding shares of Common Stock of AGCO that is payable in shares of
such Common Stock (including any stock split or subdivision of the
outstanding Common Stock of AGCO), (B) any combination of all of the
outstanding shares of Common Stock of AGCO, (C) any reorganization or
consolidation of AGCO or any merger of AGCO with or into any other
Person, or (D) the conversion of any securities of AGCO into shares of
Common Stock of AGCO;
(viii) the redemption of any preferred stock purchase rights
issued under AGCO's stockholder rights plan at a redemption price of
$0.01 per right; or
(ix) Investments in an aggregate amount not to exceed $50
million outstanding at any time in any Person or Persons the primary
business of which is related, ancillary or complementary to the
businesses of AGCO and its Restricted Subsidiaries on the date of such
Investment;
provided that, except in the case of clauses (i) and (iii) of this paragraph
(c), no Default or Event of Default shall have occurred and be continuing or
occur as a consequence of the actions or payments set forth therein.
(d) Each Restricted Payment permitted pursuant to paragraphs (b)
and (c) (other than the Restricted Payment referred to in clause (ii) of
paragraph (c), an exchange of Capital Stock for Capital Stock or Indebtedness
referred to in clause (iii) or (iv) of paragraph (c) and repurchases of Capital
Stock with the proceeds of insurance policies referred to in clause (vi) of
paragraph (c)), and the Net Cash Proceeds from any issuance of Capital Stock
referred to in clauses (iii) and (iv) of paragraph (c), shall be included in
calculating whether the conditions of clause (C) of paragraph (a) of this
"Limitation on Restricted Payments"
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covenant have been met with respect to any subsequent Restricted Payments. In
the event the proceeds of an issuance of Capital Stock of AGCO are used for the
redemption, repurchase or other acquisition of the Notes, or Indebtedness that
is pari passu with the Notes, then the Net Cash Proceeds of such issuance shall
be included in clause (C) of paragraph (a) of this "Limitation on Restricted
Payments" covenant only to the extent such proceeds are not used for such
redemption, repurchase or other acquisition of Indebtedness.
Limitation on Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries
(a) AGCO will not, and will not permit any Restricted Subsidiary
to, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction of any kind on the ability of any
Restricted Subsidiary to:
(i) pay dividends or make any other distributions
permitted by applicable law on any Capital Stock of such Restricted
Subsidiary owned by AGCO or any other Restricted Subsidiary;
(ii) pay any Indebtedness owed to AGCO or any other
Restricted Subsidiary;
(iii) make loans or advances to AGCO or any other
Restricted Subsidiary, or
(iv) transfer any of its property or assets to AGCO or any
other Restricted Subsidiary.
(b) The foregoing provisions shall not restrict any encumbrances
or restrictions that:
(i) exist in the Bank Credit Agreement, the Indenture,
the Subsidiary Guarantees or any other agreements in effect on the
Closing Date, and any extensions, refinancings, renewals or
replacements of such agreements; provided that the encumbrances and
restrictions in any such extensions, refinancings, renewals or
replacements are no less favorable in any material respect to the
Holders than those encumbrances or restrictions that are then in effect
and that are being extended, refinanced, renewed or replaced;
(ii) exist under or by reason of applicable law;
(iii) exist with respect to any Person or the property or
assets of such Person acquired by AGCO or any Restricted Subsidiary,
existing at the time of such acquisition and not incurred in
contemplation thereof, which encumbrances or restrictions are not
applicable to any Person or the property or assets of any Person other
than such Person or the property or assets of such Person so acquired;
(iv) in the case of clause (iv) of paragraph (a) of this
"Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries" covenant,
(A) restrict in a customary manner the
subletting, assignment or transfer of any property or asset
that is a lease, license, conveyance or contract or similar
property or asset,
(B) exist by virtue of any transfer of,
agreement to transfer, option or right with respect to, or
Lien on, any property or assets of AGCO or any Restricted
Subsidiary not otherwise prohibited by the Indenture, or
(C) arise or are agreed to in the ordinary
course of business, not relating to any Indebtedness, and that
do not, individually or in the aggregate, detract from the
value of property or assets of AGCO or any Restricted
Subsidiary in any manner material to AGCO or any Restricted
Subsidiary;
(v) with respect to a Restricted Subsidiary, are imposed
pursuant to an agreement that has been entered into for the sale or
disposition of all or substantially all of the Capital Stock of, or
property and assets of, such Restricted Subsidiary; or
(vi) exist under a Receivables Program; provided that the
encumbrances and restrictions in such Receivables Program are no less
favorable in any material respect to the Holders than the encumbrances
and restrictions in the Bank Credit Agreement.
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Nothing contained in this "Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries" covenant shall prevent AGCO or any Restricted
Subsidiary from (1) creating, incurring, assuming or suffering to exist any
Liens otherwise permitted in the "Limitation on Liens" covenant or (2)
restricting the sale or other disposition of property or assets of AGCO or any
of its Restricted Subsidiaries that secure Indebtedness of AGCO or any of its
Restricted Subsidiaries.
Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries
AGCO will not sell, and will not permit any Restricted Subsidiary,
directly or indirectly, to issue or sell, any shares of Capital Stock of a
Restricted Subsidiary (including options, warrants or other rights to purchase
shares of such Capital Stock) except for:
(i) issuances or sales to AGCO or a Wholly Owned
Restricted Subsidiary;
(ii) issuances of director's qualifying shares or sales to
foreign nationals of shares of Capital Stock of foreign Restricted
Subsidiaries, to the extent required by applicable law; or
(iii) issuances or sales of Common Stock of a Restricted
Subsidiary if such issuance or sale complies with the "Limitation on
Asset Sales" covenant described below (including the application of any
Net Cash Proceeds received in such transaction in accordance with
clause (i)(A) or (B) of paragraph (b) of the "Limitation on Asset
Sales" covenant).
Notwithstanding the foregoing, if, immediately after giving effect to
such issuance or sale, such Restricted Subsidiary would no longer constitute a
Restricted Subsidiary, any Investment in such Person remaining after giving
effect to such issuance or sale would have been permitted to be made under the
"Limitation on Restricted Payments" covenant, if made on the date of such
issuance or sale.
Additional Subsidiary Guarantees
(a) If any Guarantor transfers or causes to be transferred, in one
transaction or a series of related transactions, any property, or if AGCO or any
Restricted Subsidiary transfers or causes to be transferred, in one transaction
or a series of related transactions, any property of any Guarantor held by such
Guarantor as of the Closing Date (other than (A) the transfer of accounts
receivable or payment intangibles pursuant to a Receivables Program or (B)
customary sales of inventory upon fair and reasonable terms) to any Restricted
Subsidiary (other than a Foreign Subsidiary) that is not a Guarantor, or if any
Guarantor shall organize, acquire or otherwise invest in another Restricted
Subsidiary (other than a Foreign Subsidiary) after the Closing Date, then such
transferee or acquired or other Restricted Subsidiary shall:
(i) execute and deliver to the Trustee a supplemental
indenture in form reasonably satisfactory to the Trustee pursuant to
which such Restricted Subsidiary shall unconditionally guarantee on a
senior unsubordinated basis all of AGCO's obligations under the Notes
and the Indenture on the terms set forth in the Indenture; and
(ii) deliver to the Trustee an opinion of counsel that
such supplemental indenture has been duly authorized, executed and
delivered by such Restricted Subsidiary and constitutes a legal, valid,
binding and enforceable obligation of such Restricted Subsidiary.
Thereafter, such Restricted Subsidiary shall be a Guarantor for all
purposes of the Indenture.
(b) Notwithstanding anything in the foregoing paragraph (a) to the
contrary, if AGCO or any Guarantor transfers property to, organizes or invests
in a domestic Restricted Subsidiary solely for transfer to a Foreign Subsidiary,
such domestic Restricted Subsidiary shall not be required to become a Guarantor
solely by reason of such transfer.
Limitation on Issuances of Guarantees by Restricted Subsidiaries
(a) AGCO will not permit any Restricted Subsidiary, directly or
indirectly, to Guarantee any other Indebtedness of AGCO ("Guaranteed
Indebtedness"), unless:
(i) such Restricted Subsidiary simultaneously executes
and delivers a supplemental indenture to the Indenture providing for a
Subsidiary Guarantee by such Restricted Subsidiary; and
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(ii) such Restricted Subsidiary waives and will not in any
manner whatsoever claim or take the benefit or advantage of, any rights
of reimbursement, indemnity or subrogation or any other rights against
AGCO or any other Restricted Subsidiary as a result of any payment by
such Restricted Subsidiary under its Subsidiary Guarantee;
provided that this paragraph (a) shall not be applicable to any Guarantee of any
Restricted Subsidiary (A) that existed at the time such Person became a
Restricted Subsidiary and was not Incurred in connection with, or in
contemplation of, such Person becoming a Restricted Subsidiary or (B) of the
Indebtedness Incurred under the Bank Credit Agreement.
If the Guaranteed Indebtedness is (x) pari passu with the Notes, then
the Guarantee of such Guaranteed Indebtedness shall be pari passu with, or
subordinated to, the Subsidiary Guarantee or (y) subordinated to the Notes, then
the Guarantee of such Guaranteed Indebtedness shall be subordinated to the
Subsidiary Guarantee at least to the extent that the Guaranteed Indebtedness is
subordinated to the Notes.
(b) Notwithstanding the foregoing paragraph (a), any Subsidiary
Guarantee by a Restricted Subsidiary may provide by its terms that it shall be
automatically and unconditionally released and discharged under the
circumstances described above under the caption "--Subsidiary Guarantees."
Limitation on Transactions with Stockholders and Affiliates
(a) AGCO will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, enter into, renew or extend any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property or assets, or the rendering of any service) with any holder (or any
Affiliate of such holder) of 5% or more of any class of Capital Stock of AGCO or
with any Affiliate of AGCO or any Restricted Subsidiary, except upon fair and
reasonable terms no less favorable to AGCO or such Restricted Subsidiary than
could be obtained, at the time of such transaction or, if such transaction is
pursuant to a written agreement, at the time of the execution of the agreement
providing therefor, in a comparable arm's-length transaction with a Person that
is not such a holder or an Affiliate.
(b) The provisions of the preceding paragraph (a) do not limit,
and shall not apply to:
(i) transactions (A) approved by a majority of the
disinterested members of the Board of Directors, (B) for which AGCO or
a Restricted Subsidiary delivers to the Trustee a written opinion of a
nationally recognized investment banking firm stating that the
transaction is fair to AGCO or such Restricted Subsidiary from a
financial point of view or (C) involving consideration of $1 million or
less;
(ii) any transaction solely between AGCO and any of its
Wholly Owned Restricted Subsidiaries or solely between Wholly Owned
Restricted Subsidiaries;
(iii) the payment of reasonable and customary regular fees
to directors of AGCO who are not employees of AGCO;
(iv) any payments or other transactions pursuant to any
tax-sharing agreement between AGCO and any other Person with which AGCO
files a consolidated tax return or with which AGCO is part of a
consolidated group for tax purposes;
(v) any issuance of securities or other payments, awards
or grants in cash, securities or otherwise pursuant to, or the funding
of, employment arrangements, stock options and stock ownership plans or
incentive plans approved by the Board of Directors; or
(vi) any Restricted Payments not prohibited by the
"Limitation on Restricted Payments" covenant.
Notwithstanding the foregoing, any transaction covered by paragraph (a)
of this "Limitation on Transactions with Stockholders and Affiliates" covenant
and not covered by clauses (ii) through (iv) of paragraph (b), the aggregate
amount of which exceeds $10 million in value, must be approved or determined to
be fair in the manner provided for in clause (i) (A) or (B) above.
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Limitation on Liens
AGCO will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume or suffer to exist any Lien
securing Indebtedness on any of its assets or properties of any character, or
any shares of Capital Stock or Indebtedness of any Restricted Subsidiary, now
owned or hereafter acquired, or any income or profits therefrom or assign or
convey any right to receive income therefrom, except Permitted Liens, without
providing that the Notes shall be secured equally and ratably with (or prior to)
the obligations so secured for so long as such obligations are so secured.
Limitation on Asset Sales
(a) AGCO will not, and will not permit any Restricted Subsidiary
to, consummate any Asset Sale, unless:
(i) the consideration received by AGCO or such Restricted
Subsidiary is at least equal to the fair market value of the assets
sold or disposed of;
(ii) at least 85% of the consideration received consists
of cash or Temporary Cash Investments; and
(iii) such Asset Sale complies, as applicable, with the
restrictions described in the "Additional Subsidiary Guarantees"
covenant.
(b) In the event and to the extent that the Net Cash Proceeds
received by AGCO or any of its Restricted Subsidiaries from one or more Asset
Sales occurring on or after the Closing Date in any period of 12 consecutive
months exceed 10% of Adjusted Consolidated Net Tangible Assets (determined as of
the date closest to the commencement of such 12-month period for which a
consolidated balance sheet of AGCO and its subsidiaries have been filed pursuant
to the "SEC Reports and Reports to Holders" covenant), then AGCO shall or shall
cause the relevant Restricted Subsidiary to:
(i) within 12 months after the date Net Cash Proceeds so
received exceed 10% of Adjusted Consolidated Net Tangible Assets:
(A) apply an amount equal to such excess Net
Cash Proceeds to permanently repay Senior Indebtedness of AGCO
or a Guarantor or Indebtedness of any Restricted Subsidiary
that is not a Guarantor, in each case owing to a Person other
than AGCO or any of its Restricted Subsidiaries; or
(B) invest an equal amount, or the amount not so
applied pursuant to clause (A) (or enter into a definitive
agreement committing to so invest within 12 months after the
date of such agreement), in property or assets (other than
current assets) of a nature or type or that are used in a
business (or in a company having property and assets of a
nature or type, or engaged in a business) similar or related
to the nature or type of the property and assets of, or the
business of, AGCO and its Restricted Subsidiaries existing on
the date of such investment; and
(ii) apply (no later than the end of the 12-month period
referred to in clause (i)) such excess Net Cash Proceeds (to the extent
not applied pursuant to clause (i)) as provided in paragraphs (c) and
(d) of this "Limitation on Asset Sales" covenant.
The amount of such excess Net Cash Proceeds required to be applied (or to be
committed to be applied) during such 12-month period as set forth in clause (i)
and not applied as so required by the end of such period shall constitute
"Excess Proceeds."
(c) Notwithstanding the foregoing, to the extent that any or all
of the Net Cash Proceeds of any Asset Sale of assets based outside the U.S. are
prohibited or delayed by applicable local law from being repatriated to the U.S.
and such Net Cash Proceeds are not actually applied in accordance with
paragraphs (a) and (b) of this "Limitation on Asset Sales" covenant, AGCO shall
not be required to apply the portion of such Net Cash Proceeds so effected but
may permit the applicable Restricted Subsidiaries to retain such portion of the
Net Cash Proceeds so long, but only so long, as the applicable local law will
not permit repatriation to the U.S. (AGCO hereby agreeing to cause the
applicable Restricted Subsidiary to promptly take all actions required by the
applicable local law to permit such repatriation) and once such repatriation of
any such affected Net Cash Proceeds is permitted under the applicable local law,
such repatriation will be immediately effected and such repatriated Net Cash
Proceeds will be applied in the manner set forth in this covenant as if the
Asset Sale had occurred on such date; provided that to the extent that AGCO has
determined in good faith that repatriation of any or all of the Net Cash
Proceeds of such Asset Sale would have a
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material adverse tax cost consequence, the Net Cash Proceeds so affected may be
retained by the applicable Restricted Subsidiary for so long as such material
adverse tax cost event would continue.
(d) If, as of the first day of any calendar month, the aggregate
amount of Excess Proceeds not theretofore subject to an Offer to Purchase
pursuant to this "Limitation on Asset Sales" covenant totals at least $10
million, AGCO must commence, not later than the 15th Business Day of such month,
and consummate an Offer to Purchase from the Holders on a pro rata basis an
aggregate principal amount of Notes equal to the Excess Proceeds on such date,
at a purchase price equal to 101% of the principal amount of the Notes, plus, in
each case, accrued interest (if any) to the date of purchase.
Limitation on Sale/Leaseback Transactions
AGCO will not, and will not permit any Restricted Subsidiary to, enter
into any Sale/Leaseback Transaction with respect to any property unless:
(i) AGCO or such Restricted Subsidiary would be entitled
to Incur Indebtedness in an amount equal to the Attributable Debt with
respect to such Sale/Leaseback Transaction under the "Limitation on
Indebtedness" covenant;
(ii) the net proceeds received by AGCO or any Restricted
Subsidiary in connection with such Sale/Leaseback Transaction are at
least equal to the fair market value (as determined by the Board of
Directors) of such property; and
(iii) the transfer of assets in such Sale/Leaseback
Transaction is permitted by, and AGCO applies the proceeds of such
transaction in compliance with, the covenant described above under the
caption "Limitation on Asset Sales."
REPURCHASE OF NOTES UPON A CHANGE OF CONTROL
Following a Change of Control, AGCO must commence, within 30 days of
the occurrence of such Change of Control, and consummate an Offer to Purchase
for all Notes then outstanding, at a purchase price equal to 101% of the
principal amount thereof, plus accrued interest (if any) to the date of
purchase.
The Change of Control repurchase feature is a result of negotiations
between AGCO and the Initial Purchasers. Management has no present intention to
engage in a transaction involving a Change of Control, although it is possible
that AGCO would decide to do so in the future. Subject to the limitations
discussed below, AGCO could, in the future, enter into certain transactions,
including acquisitions, refinancings or other recapitalizations, that would not
constitute a Change of Control under the Indenture, but that could increase the
amount of Indebtedness outstanding at such time or otherwise affect AGCO's
capital structure. Restrictions on the ability of AGCO to incur additional
Indebtedness are contained in the covenants described above under "Limitation on
Indebtedness," "Limitation on Liens," and "Limitation on Sale/Leaseback
Transactions." Such restrictions can only be waived with the consent of the
Holders of a majority in principal amount of the Notes then outstanding. Except
for the limitations contained in the covenants, however, the Indenture will not
contain any covenants or provisions that may afford Holders protection in the
event of certain highly leveraged transactions.
The Bank Credit Agreement and other existing Indebtedness of AGCO or
its Restricted Subsidiaries provides that the occurrence of certain change of
control events with respect to AGCO would constitute a default thereunder.
Future Indebtedness that we or our Restricted Subsidiaries may incur may contain
prohibitions on the occurrence of certain events that would constitute a Change
of Control or require the repurchase of such Indebtedness upon a Change of
Control. Moreover, the exercise by the Holders of their right to require us to
repurchase the Notes could cause a default under such future Indebtedness, even
if the Change of Control itself does not, due to the financial effect of such
repurchase on us. Finally, our ability to pay cash to the Holders following the
occurrence of a Change of Control may be limited by our then existing financial
resources. There can be no assurance that sufficient funds will be available
when necessary to make any required repurchases.
SEC REPORTS AND REPORTS TO HOLDERS
Whether or not AGCO is required to file reports with the SEC, for so
long as any Notes are outstanding, AGCO shall file with the SEC all such reports
and other information as it would be required to file with the SEC by Sections
13(a) or 15(d) under the Exchange Act if it were subject thereto.
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EVENTS OF DEFAULT
The following events will be defined as "Events of Default" in the
Indenture:
(a) default in the payment of principal of (or premium,
if any, on) any Note when the same becomes due and payable at maturity,
upon acceleration, redemption or otherwise;
(b) default in the payment of interest on any Note when
the same becomes due and payable, and such default continues for a
period of 30 days;
(c) default in the performance or breach of the
provisions of the Indenture applicable to mergers, consolidations and
transfers of all or substantially all of the assets of AGCO or the
failure to make or consummate an Offer to Purchase in accordance with
the "Limitation on Asset Sales" or "Repurchase of Notes upon a Change
of Control" covenant;
(d) default in the performance of or breach of any other
covenant or agreement of AGCO in the Indenture or under the Notes
(other than a default specified in clause (a), (b) or (c) above) that
continues for a period of 30 consecutive days after written notice by
the Trustee or the Holders of 25% or more in aggregate principal amount
of the Notes;
(e) the occurrence with respect to any issue or issues of
Indebtedness of AGCO or any Significant Subsidiary having an
outstanding principal amount of $10 million or more in the aggregate
for all such issues of all such Persons, whether such Indebtedness now
exists or shall hereafter be created, of:
(i) an event of default that has caused the
holder thereof to declare such Indebtedness to be due and
payable prior to its Stated Maturity and such Indebtedness has
not been discharged in full or such acceleration has not been
rescinded or annulled within 30 days of such acceleration; or
(ii) the failure to make a principal payment at
the final (but not any interim) fixed maturity and such
defaulted payment shall not have been made, waived or extended
within 30 days of such payment default;
(f) any final judgment or order (not covered by
insurance) for the payment of money in excess of $10 million in the
aggregate for all such final judgments or orders against all such
Persons (treating any deductibles, self-insurance or retention as not
so covered) shall be rendered against AGCO or any Significant
Subsidiary and shall not be paid or discharged, and there shall be any
period of 30 consecutive days following entry of the final judgment or
order that causes the aggregate amount for all such final judgments or
orders outstanding and not paid or discharged against all such Persons
to exceed $10 million during which a stay of enforcement of such final
judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect;
(g) a court having jurisdiction in the premises enters a
decree or order for:
(i) relief in respect of AGCO or any Significant
Subsidiary in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter
in effect;
(ii) appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official
of AGCO or any Significant Subsidiary or for all or
substantially all of the property and assets of AGCO or any
Significant Subsidiary; or
(iii) the winding up or liquidation of the affairs
of AGCO or any Significant Subsidiary and, in each case, such
decree or order shall remain unstayed and in effect for a
period of 30 consecutive days;
(h) AGCO or any Significant Subsidiary:
(i) commences a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law;
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(ii) consents to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of AGCO or any
Significant Subsidiary or for all or substantially all of the
property and assets of AGCO or any Significant Subsidiary; or
(iii) effects any general assignment for the
benefit of creditors; or
(i) any Subsidiary Guarantee ceases to be in full force
and effect or any Subsidiary Guarantee is declared to be null and void
and unenforceable or any Subsidiary Guarantee is found to be invalid or
any Guarantor denies its liability under its Subsidiary Guarantee
(other than by reason of release of a Subsidiary Guarantee in
accordance with the terms of the Indenture) and such condition has
continued for a period of 30 days after written notice of such failure
requiring the Guarantor and AGCO to remedy the same has been given (x)
to AGCO by the Trustee or (y) to AGCO and the Trustee by the Holders of
25% in aggregate principal amount of the notes then outstanding.
ACCELERATION, WAIVER AND OTHER REMEDIES
If an Event of Default (other than an Event of Default specified in
clause (g) or (h) under the heading "Events of Default" above that occurs with
respect to AGCO) occurs and is continuing under the Indenture,
(i) the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes, then outstanding, by written
notice to AGCO (and to the Trustee if such notice is given by the
Holders), may, and
(ii) the Trustee, at the request of such Holders, shall,
declare the principal of, premium, if any, and accrued interest on the Notes to
be immediately due and payable.
Upon a declaration of acceleration, such principal of, premium, if any,
and accrued interest shall be immediately due and payable. In the event of a
declaration of acceleration because an Event of Default set forth in clause (e)
under the heading "Events of Default" above has occurred and is continuing, such
declaration of acceleration shall be automatically rescinded and annulled if the
event of default triggering such Event of Default pursuant to clause (e) under
the heading "Events of Default" shall be remedied or cured by AGCO or the
relevant Significant Subsidiary or waived by the holders of the relevant
Indebtedness within 60 days after the declaration of acceleration with respect
thereto. If an Event of Default specified in clauses (g) or (h) under the
heading "Events of Default" above occurs with respect to AGCO, the principal of,
premium, if any, and accrued interest on the Notes then outstanding shall ipso
facto become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Holder. The Holders of at least a majority
in principal amount of the outstanding Notes by written notice to AGCO and to
the Trustee, may waive all past defaults and rescind and annul a declaration of
acceleration and its consequences if (A) all existing Events of Default, other
than the nonpayment of the principal of, premium, if any, and interest on the
Notes that have become due solely by such declaration of acceleration, have been
cured or waived and (B) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction. For information as to the waiver of
defaults, see "Modification" below.
The Holders of at least a majority in aggregate principal amount of the
outstanding Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee. However, the Trustee may refuse to follow any
direction that conflicts with law or the Indenture, that may involve the Trustee
in personal liability, or that the Trustee determines in good faith may be
unduly prejudicial to the rights of Holders not joining in the giving of such
direction and may take any other action it deems proper that is not inconsistent
with any such direction received from Holders. A Holder may not pursue any
remedy with respect to the Indenture or the Notes unless:
(i) the Holder gives the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal
amount of outstanding Notes make a written request to the Trustee to
pursue the remedy;
(iii) such Holder or Holders offer the Trustee indemnity
satisfactory to the Trustee against any costs, liability or expense;
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(iv) the Trustee does not comply with the request within
60 days after receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of a majority
in aggregate principal amount of the outstanding Notes do not give the
Trustee a direction that is inconsistent with the request.
However, such limitations do not apply to the right of any Holder to receive
payment of the principal of, premium, if any, or interest on, such Note or to
bring suit for the enforcement of any such payment, on or after the due date
expressed in the Notes, which right shall not be impaired or affected without
the consent, of the Holder.
The Indenture will require certain officers of AGCO to certify, on or
before a date not more than 45 days after the end of each fiscal quarter or not
more than 90 days after the end of each fiscal year, that a review has been
conducted of the activities of AGCO and its Restricted Subsidiaries and AGCO's
and its Restricted Subsidiaries' performance under the Indenture and that AGCO
has fulfilled all obligations thereunder, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default and the nature
and status thereof. AGCO will also be obligated to notify the Trustee of any
default or defaults in the performance of any covenants or agreements under the
Indenture.
CONSOLIDATION, MERGER AND SALE OF ASSETS
AGCO will not consolidate with, merge with or into, or sell, convey,
transfer, lease or otherwise dispose of all or substantially all of its property
and assets (as an entirety or substantially an entirety in one transaction or a
series of related transactions) to, any Person or permit any Person to merge
with or into AGCO unless:
(i) AGCO shall be the continuing Person, or the Person
(if other than AGCO) formed by such consolidation or into which AGCO is
merged or that acquired or leased such property and assets of AGCO
shall be a corporation organized and validly existing under the laws of
the U.S. of America or any jurisdiction thereof and shall expressly
assume, by a supplemental indenture, executed and delivered to the
Trustee, all of the obligations of AGCO on all of the Notes and under
the Indenture;
(ii) immediately after giving effect to such transaction,
no Default or Event of Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction
on a pro forma basis, AGCO or any Person becoming the successor obligor
of the Notes shall have a Consolidated Net Worth equal to or greater
than the Consolidated Net Worth of AGCO immediately prior to such
transaction;
(iv) immediately after giving effect to such transaction
on a pro forma basis AGCO, or any Person becoming the successor obligor
of the Notes, as the case may be, could Incur at least $1.00 of
Indebtedness under paragraph (a) of the "Limitation on Indebtedness"
covenant; provided that this clause (iv) shall not apply to a
consolidation or merger with or into a Wholly Owned Restricted
Subsidiary with a positive net worth; provided further that, in
connection with any such merger or consolidation, no consideration
(other than Common Stock in the surviving Person or AGCO) shall be
issued or distributed to the stockholders of AGCO; and
(v) AGCO delivers to the Trustee an Officers' Certificate
(attaching the arithmetic computations to demonstrate compliance with
clauses (iii) and (iv)) and an Opinion of Counsel, in each case stating
that such consolidation, merger or transfer and such supplemental
indenture complies with this provision and that all conditions
precedent provided for herein relating to such transaction have been
complied with.
Notwithstanding the foregoing, clauses (iii) and (iv) above do not
apply if, in the good faith determination of the Board of Directors of AGCO,
whose determination shall be evidenced by a Board Resolution, the principal
purpose of such transaction is to change the state of incorporation of AGCO;
provided that any such transaction shall not have as one of its purposes the
evasion of the foregoing limitations.
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DEFEASANCE
Defeasance and Discharge. The Indenture provides that AGCO will be
deemed to have paid and will be discharged from any and all obligations in
respect of the Notes on the 123rd day after the deposit referred to below, and
the provisions of the Indenture will no longer be in effect with respect to the
Notes (except for, among other matters, certain obligations to register the
transfer or exchange of the Notes, to replace stolen, lost or mutilated Notes,
to maintain paying agencies and to hold monies for payment in trust) if, among
other things:
(i) AGCO has deposited with the Trustee, in trust, money
or U.S. Government Obligations that through the payment of interest and
principal in respect thereof in accordance with their terms will
provide money in an amount sufficient to pay the principal of, premium,
if any, and accrued interest on the Notes on the Stated Maturity of
such payments in accordance with the terms of the Indenture and the
Notes,
(ii) AGCO has delivered to the Trustee:
(A) either
(1) an Opinion of Counsel to the effect
that Holders will not recognize income, gain or loss
for federal income tax purposes as a result of AGCO's
exercise of its option under this "Defeasance"
provision and will be subject to federal income tax
on the same amount and in the same manner and at the
same times as would have been the case if such
deposit, defeasance and discharge had not occurred,
which Opinion of Counsel must be based upon (and
accompanied by a copy of) a ruling of the Internal
Revenue Service to the same effect unless there has
been a change in applicable federal income tax law
after the Closing Date such that a ruling is no
longer required; or
(2) a ruling directed to the Trustee
received from the Internal Revenue Service to the
same effect as the aforementioned Opinion of Counsel;
and
(B) an Opinion of Counsel to the effect that the
creation of the defeasance trust does not violate the
Investment Company Act of 1940 and after the passage
of 123 days following the deposit, the trust fund
will not be subject to the effect of Section 547 of
the U.S. Bankruptcy Code or Section 15 of the New
York Debtor and Creditor Law;
(iii) immediately after giving effect to such deposit on a
pro forma basis, no Event of Default, or event that after the giving of
notice or lapse of time or both would become an Event of Default, shall
have occurred and be continuing on the date of such deposit or during
the period ending on the 123rd day after the date of such deposit, and
such deposit shall not result in a breach or violation of, or
constitute a default under, any other agreement or instrument to which
AGCO or any of its Subsidiaries is a party or by which AGCO or any of
its Subsidiaries is bound; and
(iv) if at such time the Notes are listed on a national
securities exchange, AGCO has delivered to the Trustee an Opinion of
Counsel to the effect that the Notes will not be delisted as a result
of such deposit, defeasance and discharge.
Defeasance of Certain Covenants and Certain Events of Default. The
Indenture further provides that the provisions of the Indenture will no longer
be in effect with respect to clauses (iii) and (iv) under "Consolidation, Merger
and Sale of Assets" and all the covenants described herein under "Covenants,"
and clause (c) under "Events of Default" with respect to such clauses (iii) and
(iv) under "Consolidation, Merger and Sale of Assets," clause (d) with respect
to such covenants and clauses (e) and (f) under "Events of Default" shall be
deemed not to be Events of Default, upon, among other things, the deposit with
the Trustee, in trust, of money or U.S. Government Obligations that through the
payment of interest and principal in respect thereof in accordance with their
terms will provide money in an amount sufficient to pay the principal of,
premium, if any, and accrued interest on the Notes on the Stated Maturity of
such payments in accordance with the terms of the Indenture and the Notes, the
satisfaction of the provisions described in clauses (ii)(B), (iii), and (iv) of
the preceding paragraph and the delivery by AGCO to the Trustee of an Opinion of
Counsel to the effect that, among other things, the Holders will not recognize
income, gain or loss for federal income tax purposes as a result of such deposit
and defeasance of certain covenants and Events of Default and will be subject to
federal income tax on the same amount and in the same manner and at the same
times as would have been the case if such deposit and defeasance had not
occurred.
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Defeasance and Certain Other Events of Default. In the event AGCO
exercises its option to omit compliance with certain covenants and provisions of
the Indenture with respect to the Notes as described in the immediately
preceding paragraph and the Notes are declared due and payable because of the
occurrence of an Event of Default that remains applicable, the amount of money
or U.S. Government Obligations on deposit with the Trustee will be sufficient to
pay amounts due on the Notes at the time of their Stated Maturity but may not be
sufficient to pay amounts due on the Notes at the time of the acceleration
resulting from such Event of Default. However, AGCO will remain liable for such
payments.
MODIFICATION
Modifications and amendments of the Indenture may be made by AGCO, the
Guarantors and the Trustee with the consent of the Holders of not less than a
majority in aggregate principal amount of the outstanding Notes; provided,
however, that no such modification or amendment may, without the consent of each
Holder affected thereby:
- change the Stated Maturity of the principal of, or any
installment of interest on, any Note;
- reduce the principal amount of, or premium, if any, or
interest on, any Note;
- change the place or currency of payment of principal of, or
premium, if any, or interest on, any Note;
- impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity (or, in the case of a
redemption, on or after the Redemption Date) of any Note;
- reduce the above-stated percentage of outstanding Notes the
consent of whose Holders is necessary to modify or amend the
Indenture;
- waive a default in the payment of principal of, premium, if
any, or interest on the Notes; or
- reduce the percentage or aggregate principal amount of
outstanding Notes the consent of whose Holders is necessary
for waiver of compliance with certain provisions of the
Indenture or for waiver of certain defaults.
NO PERSONAL LIABILITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS, DIRECTORS, OR
EMPLOYEES
The indenture provides that no recourse for the payment of the
principal of, premium, if any, or interest on any of the notes or for any claim
based thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of ours in the indenture, or in any of the
notes or because of the creation of any indebtedness represented thereby, shall
be had against any incorporator, stockholder, officer, director, employee or
controlling person of ours or of any successor person thereof. Each holder, by
accepting the notes, waives and releases all such liability.
CONCERNING THE TRUSTEE
The indenture provides that, except during the continuance of a
Default, the trustee will not be liable, except for the performance of such
duties as are specifically set forth in such indenture. If an Event of Default
has occurred and is continuing, the trustee will use the same degree of care and
skill in its exercise as a prudent person would exercise under the circumstances
in the conduct of such person's own affairs.
The indenture and provisions of the TIA, incorporated by reference
therein contain limitations on the rights of the trustee, should it become a
creditor of ours, to obtain payment of claims in certain cases or to realize on
certain property received by it in respect of any such claims, as security or
otherwise. The trustee is permitted to engage in other transactions; provided,
however, that if it acquires any conflicting interest, it must eliminate such
conflict or resign.
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BOOK-ENTRY; DELIVERY AND FORM
We will issue new notes in exchange for existing notes currently
represented by one or more fully registered global notes. The new notes will be
represented by one or more fully registered global notes, and will be deposited
upon issuance with DTC or a nominee of DTC.
We will issue new notes in certified form without interest coupons in
exchange for existing notes which were issued originally in certified form
without interest coupons.
The new notes will trade in DTC's Same Day Funds Settlement System
until maturity, and secondary market trading activity in such new notes will
therefore be required by DTC to settle in immediately available funds. We cannot
assure you as to the effect, if any, of settlement in immediately available
funds on trading activity in the new notes.
So long as DTC, or its nominee, is the registered owner or holder of
the global notes, DTC or such nominee, as the case may be, will be considered
the sole record owner or holder of the notes represented by such global notes
for all purposes under the indenture and the notes. No beneficial owners of an
interest in a global note will be able to transfer that interest except in
accordance with DTC's applicable procedures, in addition to those provided for
under the indenture and, if applicable, the Euroclear or Cedel.
Payments of the principal of, and interest on, a global note will be
made to DTC or its nominee, as the case may be, as the registered owner thereof.
Neither us, the trustee nor any paying agent will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in a global note or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
We expect that DTC or its nominee, upon receipt of any payment of
principal or interest in respect of a global note will credit participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the principal amount of such global note, as shown on the records
of DTC or its nominee. We also expect that payments by participants to owners of
beneficial interests in such global note held through such participants will be
governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers registered in the names of
nominees for such customers. Such payments will be the responsibility of such
participants.
DTC has advised us as follows: DTC is a limited purpose trust company
organized under the laws of the State of New York, a "banking organization"
within the meaning of the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the Uniform Commercial
Code and a "Clearing Agency" registered pursuant to the provision of Section 17A
of the Exchange Act. DTC was created to hold securities for its participants and
facilitate the clearance and settlement of securities transactions between
participants through electronic book-entry changes in accounts of its
participants, thereby eliminating the need for physical movement of
certificates. Participants include securities brokers and dealers, banks, trust
companies and clearing corporations and certain other organizations. Indirect
access to the DTC system is available to others such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a participant, either directly or indirectly ("indirect participants").
Neither us, nor the trustee will have any responsibility for the
performance by DTC or its participants or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
If DTC is at any time unwilling or unable to continue as a depositary
for the global notes and a successor depositary is not appointed by us within 90
days, we will issue definitive notes in exchange for the global notes.
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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
Set forth below is a discussion of the U.S. federal income tax
consequences of the exchange as well as the ownership and disposition of the new
notes. This discussion is based on the provisions of the Internal Revenue Code
of 1986, as amended (the "Code"), final, temporary and proposed tax regulations
issued thereunder ("Treasury Regulations"), and administrative and judicial
interpretations thereof, all as in effect on the date hereof and all of which
are subject to change (possibly on a retroactive basis).
This summary is intended for general information only and does not
purport to address all of the U.S. federal income tax consequences that may be
applicable to a holder of notes. The tax treatment of a holder of notes will
vary depending on its particular situation. For example, certain holders may be
subject to special rules not discussed herein (including, for example,
individual retirement and other tax-deferred accounts, insurance companies,
tax-exempt organizations, financial institutions, broker-dealers, U.S. persons
whose functional currency (as defined in Section 985 of the Code) is not the
U.S. dollar, and persons holding notes as part of a hedging transaction,
"straddle," conversion transaction or other integrated transactions). In
addition, this discussion only addresses the tax consequences of the exchange
and ownership of notes to holders that acquired the old notes upon original
issuance at their "issue price" as defined in Section 1273 of the Code and who
hold both the old and new notes as capital assets within the meaning of Section
1221 of the Code. As used herein, the term "U.S. Holder" means a beneficial
owner of a note who is for U.S. federal income tax purposes: (1) a citizen or
individual resident of the U.S.; (2) a corporation, partnership or other entity
created or organized in or under the laws of the U.S. or of any political
subdivision thereof; (3) an estate the income of which is subject to U.S.
federal income taxation regardless of its source; or (4) a trust if both (A) a
U.S. court is able to exercise primary supervision over the administration of
the trust, and (B) one or more U.S. persons have the authority to control all
substantial decisions of the trust. As used herein, the term "Non-U.S. Holder"
means a beneficial owner of a note that is not a U.S. Holder.
If any notes are held by a partnership, the tax treatment of a partner
generally will depend upon the status of the partner and the activities of the
partnership. Partners in partnerships holding notes should consult their tax
advisors.
EACH HOLDER SHOULD CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE U.S.
FEDERAL INCOME TAX CONSEQUENCES SET FORTH BELOW AND ANY OTHER U.S. FEDERAL,
STATE, LOCAL, ESTATE OR FOREIGN TAX CONSEQUENCES OF EXCHANGING AND HOLDING THE
NOTES.
TAX CONSEQUENCES OF THE EXCHANGE
The exchange of old notes for new notes in the exchange offer will not
be treated as an "exchange" for federal income tax purposes because the new
notes do not differ materially in kind or extent from the old notes.
Accordingly:
- holders will not recognize taxable gain or loss upon the
receipt of new notes in exchange for old notes in the exchange
offer;
- the holding period for a new note received in the exchange
offer will include the holding period of the old note
surrendered in exchange therefor; and
- the adjusted tax basis of a new note immediately after the
exchange will be the same as the adjusted tax basis of the old
note surrendered in exchange therefor.
U.S. FEDERAL INCOME TAXATION OF U.S. HOLDERS
Stated Interest
A U.S. Holder of a new note will be required to include in gross income
the stated interest on a new note in accordance with the U.S. Holder's regular
method of tax accounting. As a general rule, a U.S. Holder of a new note using
the accrual method of tax accounting is required to include stated interest on a
new note in gross income as such interest accrues, while a cash basis U.S.
Holder must include stated interest on a new note in gross income when cash
payments of such interest are received (or made available for receipt) by such
U.S. Holder.
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Sale or Other Taxable Disposition of a Note
Upon the sale or other taxable disposition of a new note, the U.S.
Holder of such note generally will recognize gain or loss equal to the
difference between (1) the amount of cash and the fair market value of property
received (other than the portion of such amount, if any, attributable to accrued
and unpaid interest not previously included in gross income, which amount will
be treated as interest received), and (2) the U.S. Holder's adjusted tax basis
in the new note. A U.S. Holder's adjusted tax basis in a new note generally will
equal the cost of the old note to the U.S. Holder, subject to certain
adjustments. Provided that the new note is a capital asset in the hands of the
U.S. Holder and has been held for more than one year, any gain or loss
recognized by the U.S. Holder generally will be a long-term capital gain or loss
and, in the case of certain non-corporate U.S. Holders (including individuals),
will generally be subject to U.S. federal income tax at preferential rates.
U.S. FEDERAL TAXATION OF NON-U.S. HOLDERS
The discussion set forth below is a summary of certain U.S. federal
income and withholding tax considerations that may be relevant to a Non-U.S.
Holder of new notes.
A Non-U.S. Holder of a new note generally will not be subject to U.S.
federal withholding tax in respect of payments of interest on the new note,
provided that the interest income of the Non-U.S. Holder qualifies for the
"portfolio interest exception" and is not effectively connected with the conduct
of a U.S. trade or business. A Non-U.S. Holder of a new note generally will
qualify for the portfolio interest exception if:
- the Non-U.S. Holder does not actually or constructively own
10% or more of the total combined voting power of all classes
of our voting stock;
- the Non-U.S. Holder is not a controlled foreign corporation
that is related to us through stock ownership; and
- the Non-U.S. Holder is not a bank extending credit pursuant to
a loan agreement entered into in the ordinary course of
business.
If a Non-U.S. Holder of a new note is engaged in a trade of business in
the U.S. and interest on the new note is effectively connected with the conduct
of such trade or business, such Non-U.S. Holder, although exempt from the U.S.
federal withholding tax (provided the Non-U.S. Holder files the appropriate
certification with us or our U.S. agent), generally will be subject to U.S.
federal income tax on such interest in the same manner as if it were a U.S.
Holder. In addition, if such Non-U.S. Holder is a foreign corporation, it may be
subject to a branch profits tax equal to 30% of its effectively connected
earnings and profits (subject to adjustment) for that taxable year unless it
qualifies for a lower rate under an applicable income tax treaty.
If the interest income of a Non-U.S. Holder does not qualify for the
portfolio interest exception (described above), and is not effectively connected
with the conduct of a U.S. trade or business, it is subject to U.S. federal
withholding tax at a 30% rate unless the holder establishes it is entitled to an
exemption or a reduced rate of tax pursuant to a treaty between the U.S. and the
Non-U.S. Holder's country of residence. Generally, the tax is only payable to
the extent payments are made with respect to the new notes. Accordingly, if a
Non-U.S. Holder receives an interest or principal payment with respect to the
new notes that is subject to the 30% tax, the portion of such payment which is
taxable is equal to the accrued interest on such notes that has not previously
been subject to tax. This could include both the interest that accrued since the
last payment date and, to the extent not previously taxed, prior period interest
accruals.
To claim the benefit of a tax treaty or any exemption from withholding
either under the portfolio interest exception or because the income is
effectively connected to a U.S. trade or business, the Non-U.S. Holder must
provide a properly executed IRS Form W-8BEN, W-8IMY or W-ECI, as applicable,
prior to the payment of the interest. These forms must be periodically updated.
The Treasury Department issued new tax regulations that took effect on January
1, 2001 relating to the withholding of payments made to foreign persons.
Non-U.S. Holder are advised to consult their tax advisors to ensure compliance
with the new rules.
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Any capital gain realized upon a sale, exchange, redemption, or other
disposition of a new note by a Non-U.S. Holder generally will not be subject to
U.S. federal income tax unless (i) such gain is effectively connected with the
conduct of a U.S. trade or business of the Non-U.S. Holder, or (ii) in the case
of an individual, such Non-U.S. Holder is present in the U.S. for 183 days or
more in the taxable year of the sale, exchange, redemption, or other disposition
and certain other conditions are satisfied.
INFORMATION REPORTING AND BACKUP WITHHOLDING
In general, information reporting requirements will apply to certain
U.S. Holders who are not corporations with respect to payments of principal and
interest on a new note and to the proceeds of the sale of a new note.
Information reporting requirements generally will not apply to payments of
interest and principal on a new note to a Non-U.S. Holder who has certified its
non-U.S. status on properly executed IRS forms, as described above.
A holder of new notes also may be subject, under certain circumstances,
to backup withholding with respect to payments received with respect to the new
notes. This withholding generally applies:
- if the holder fails to furnish a social security or other
taxpayer identification number ("TIN") in the manner required
by the Treasury Regulations or furnished an incorrect TIN;
- if we are notified by the IRS that such holder has failed to
properly report payments of interest or dividends and the IRS
has notified us or our agent that such holder is subject to
backup withholding; or
- if the holder fails, under certain circumstances, to provide a
certified statement, signed under penalty of perjury, that the
TIN provided is such holder's correct TIN and that such holder
is not subject to backup withholding.
Any amount withheld from a payment to a holder under the backup
withholding rules is allowable as a refundable credit against such holder's U.S.
federal income tax liability, provided that the required information is timely
furnished to the IRS. Certain holders are not subject to backup withholding,
including, among others, corporations and a Non-U.S. Holder who has certified
its non-U.S. status on properly executed IRS forms or has otherwise established
an exemption (provided the neither us or our agent has actual knowledge that
such holder is a U.S. person or that the conditions of any other exemption are
not in fact satisfied). Holders should consult their tax advisors as to their
ability to qualify for an exemption from backup withholding and the procedure
for obtaining such an exemption.
THE FOREGOING DISCUSSION IS INTENDED FOR GENERAL INFORMATION AND IS NOT
TAX ADVICE. ACCORDINGLY, EACH HOLDER SHOULD CONSULT ITS OWN TAX ADVISOR AS TO
THE PARTICULAR TAX CONSEQUENCES TO SUCH HOLDER OF THE EXCHANGE OF NOTES, AND THE
OWNERSHIP AND DISPOSITION OF NEW NOTES, INCLUDING THE APPLICABILITY AND EFFECT
OF ANY STATE, LOCAL, OR FOREIGN TAX LAWS AND ANY RECENT OR PROSPECTIVE CHANGES
IN APPLICABLE TAX LAWS.
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PLAN OF DISTRIBUTION
Based on interpretations by the staff of the SEC set forth in no-action
letters issued to third parties, we believe that you will be allowed to resell
the new notes to the public without registration under the Securities Act, and
without delivering a prospectus that satisfies the requirements of Section 10 of
the Securities Act, if :
- you are acquiring the new notes in the ordinary course of your
business;
- you are not engaged in, and you do not intend to engage in,
the distribution (within the meaning of the federal securities
laws) of the new notes;
- you have no arrangement or understanding with anyone to
participate in a distribution of the new notes; and
- you are not an "affiliate," as defined in Rule 405 under the
Securities Act, of AGCO.
If our belief is inaccurate and you transfer any new certificate
without delivering a prospectus meeting the requirements of the Securities Act
or without an exemption from registration of your notes from these requirements,
you may incur liability under the Securities Act. We do not assume any liability
or indemnify you against any liability under the Securities Act.
We are not using any underwriters for this exchange offer. We are
bearing the expenses of the exchange.
Each broker-dealer that receives new notes for its own account pursuant
to the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of these new notes. This prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of new notes received in exchange for old notes where
the old notes were acquired as a result of market-making activities or other
trading activities. We have agreed that, for a period of 180 days after the
expiration date of the exchange offer, we will make this prospectus, as amended
or supplemented, available to any broker-dealer for use in connection with any
resale of these old notes. In addition, until , 2001, all dealers effecting
transactions in the new notes may be required to deliver a prospectus.
We will not receive any proceeds from any sale of new notes by
broker-dealers or any other persons. New notes received by broker-dealers for
their own account pursuant to the exchange offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the new notes, or a combination
of these methods of resale, at market prices prevailing at the time of resale,
at prices related to the prevailing market prices, or negotiated prices. Any
resale of new notes may be made directly to purchasers or to or through brokers
or dealers who may receive compensation in the form of commissions or
concessions from any broker-dealer and/or the purchasers of any new notes. Any
broker-dealer that resells new notes that were received by it for its own
account pursuant to the exchange offer and any broker-dealer that participates
in a distribution of the new notes may be deemed to be an "underwriter" within
the meaning of the Securities Act, and any profit on any these resales of new
notes and any commissions or concessions received by any of these persons may be
deemed to be underwriting compensation under the Securities Act. The letter of
transmittal states that, by acknowledging that it will deliver and by delivering
a prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of 180 days after the expiration date of the exchange
offer, we will promptly send additional copies of this prospectus and any
amendment or supplement to this prospectus to any broker-dealer that requests
these documents in the letter of transmittal. We have agreed to pay all expenses
incident to the exchange offer, including the expenses of one counsel for the
holders of the notes, other than commissions or concessions of any brokers or
dealers and will indemnify the holders of the new notes, including any
broker-dealer, against certain liabilities, including liabilities under the
Securities Act.
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LEGAL MATTERS
The legality of the new notes we are offering will be passed upon for
us by Troutman Sanders LLP. A copy of the legal opinion rendered by Troutman
Sanders LLP is filed as an exhibit to the registration statement containing this
prospectus.
EXPERTS
The consolidated financial statements and schedules of AGCO Corporation
as of December 31, 2000 and 1999 and for each of the three years in the period
ended December 31, 2000, which are incorporated by reference in this
registration statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and are
incorporated by reference herein in reliance upon the authority of said firm as
experts in accounting and auditing in giving said reports.
The financial statements of AGCO Finance LLC (formerly known as
Agricredit Acceptance LLC), as of December 31, 2000, 1999 and 1998, and for each
of the years in the three-year period ended December 31, 2000, have been
incorporated by reference in this registration statement in reliance upon the
report of KPMG LLP, independent certified public accountants, and upon authority
of said firm as experts in accounting and auditing.
The consolidated financial statements and schedule of Ag-Chem as of
September 30, 2000 and 1999, and for each of the years in the three-year period
ended September 30, 2000, have been incorporated by reference in this
registration statement in reliance upon the reports of KPMG LLP, independent
certified public accountants, incorporated by reference herein, and upon
authority of said firm as experts in accounting and auditing.
The financial statements of Redball, LLC as of September 30, 2000 and
for the year then ended have been incorporated by reference in this registration
statement, in reliance upon the report of KPMG LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
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AGCO CORPORATION
OFFER TO EXCHANGE
$250,000,000
9 1/2% SENIOR NOTES DUE 2008
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR $250,000,000 OUTSTANDING UNREGISTERED
9 1/2% SENIOR NOTES DUE 2008
----------------------------
PROSPECTUS
----------------------------
, 2001
UNTIL , 2001, ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE SECURITIES,
WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A
PROSPECTUS. THIS IS IN ADDITION TO THE DEALERS' OBLIGATION TO DELIVER A
PROSPECTUS WHERE ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law, Section 302A.251
of the Minnesota Business Corporation Act and Section 17-6305 of the Kansas
General Corporation Code empowers respective corporation to indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation) by reason of the fact that such person is or was a director,
officer, employee or agent of such corporation, or is or was serving at the
request of such corporation as a director, officer, employee or agent of another
corporation or enterprise. A corporation may indemnify such person against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
such action, suit or proceeding if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe such person's conduct was
unlawful. A Delaware, Minnesota or Kansas corporation may indemnify officers and
directors in an action by or in the right of the corporation to procure a
judgment in its favor under the same conditions, except that no indemnification
is permitted without judicial approval if the officer or director is adjudged to
be liable to the corporation. Where a present or former officer or director is
successful on the merits or otherwise in the defense of any action referred to
above, the corporation must indemnify such person against the expenses
(including attorneys' fees) which such person actually and reasonably incurred
in connection therewith. The indemnification provided is not deemed to be
exclusive of any other rights to which an officer or director may be entitled
under any corporation's bylaws, agreement, vote or otherwise.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits:
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
----------------------------------------------------------------------------------------------------
1.1 Purchase Agreement, dated April 11, 2001, among AGCO Corporation, Credit Suisse First Boston
Corporation, Bear, Stearns & Co. Inc. and SunTrust Equitable Securities.
3.1 Certificate of Incorporation of AGCO Corporation incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 1996.
3.2 Certificate of Designation for Class A Convertible Preferred Stock incorporated by reference
to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
3.3 By-Laws of AGCO Corporation incorporated by reference to the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1997.
4.1 Rights Agreement, as amended, between and among AGCO Corporation and SunTrust Bank, as
rights agent, dated as of April 27, 1994 incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1994 and the Registrant's Form
8-A/A dated August 8, 1999.
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4.2 Indenture between AGCO Corporation and SunTrust Bank, as Trustee, dated as of March 20,
1996, incorporated by reference to the Registrant's Annual Report on Form 10-K for the year
ended December 31, 1995.
4.3 Indenture among AGCO Corporation, as Issuer, the Guarantors named therein, and SunTrust
Bank, as Trustee, dated as of April 17, 2001, incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
4.4 Registration Rights Agreement, dated April 11, 2001, among AGCO Corporation, Credit Suisse
First Boston Corporation, Bear, Stearns & Co. Inc. and SunTrust Equitable Securities,
incorporated by reference to the Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 31, 2001.
4.5 Form of 9 1/2% Senior Note due 2008 (included in Exhibit 4.3).
5.1 Opinion of Troutman Sanders LLP.
10.1 1991 Stock Option Plan, as amended, incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1998.*
10.2 Form of Stock Option Agreements (Statutory and Nonstatutory) incorporated by reference to
the Registrant's Registration Statement on Form S-1 (No. 33-43437) dated April 16, 1992.*
10.3 Amended and Restated Long-Term Incentive Plan (LTIP III) incorporated by reference to the
Registrant's Annual Report on Form 10-K for the year ended December 31, 2000.*
10.4 Nonemployee Director Stock Incentive Plan, as amended incorporated by reference to the
Registrant's Annual Report on Form 10-K for the year ended December 31, 1997.*
10.5 Management Incentive Compensation Plan incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1995.*
10.6 2001 Stock Option Plan incorporated by reference to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended March 31, 2001.*
10.7 Credit Agreement dated as of April 17, 2001, among AGCO Corporation, Cooperatieve Centrale
Raiffeisen-Boerenleenbank B.A. and the other parties named therein incorporated by reference
to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
10.8 Employment and Severance Agreement by and between AGCO Corporation and Robert J. Ratliff
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1995.*
10.9 Employment and Severance Agreement by and between AGCO Corporation and John M. Shumejda
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1995.*
10.10 Employment and Severance Agreement by and between AGCO Corporation and Edward R. Swingle
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1999.*
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10.11 Employment and Severance Agreement by and between AGCO Corporation and Norman L. Boyd
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.*
10.12 Employment and Severance Agreement by and between AGCO Corporation and Aaron D. Jones
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.*
10.13 Receivables Purchase Agreement dated as of January 27, 2000 among AGCO Corporation, AGCO
Funding Corporation and Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., as
administrative agent, incorporated by reference to the Registrant's Annual Report on Form
10-K for the year ended December 31, 1999.
12.1 Statement re: Computation of Ratio of Earnings to Combined Fixed Charges.
23.1 Consent of Troutman Sanders LLP (included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP, independent public accountants.
23.3 Consent of KPMG LLP, independent certified public accountants, for financial statements of
AGCO Finance LLC.
23.4 Consent of KPMG LLP, independent certified public accountants, for financial statements of
Ag-Chem Equipment Co., Inc.
23.5 Consent of KPMG LLP, independent certified public accountants, for financial statements of
Redball, LLC.
25.1 Statement of Eligibility of Trustee on Form T-1.
99.1 Form of Letter of Transmittal for 9 1/2% Senior Notes due 2008.
99.2 Form of Notice of Guaranteed Delivery for 9 1/2% Senior Notes due 2008.
99.3 Form of Letter to Clients for 9 1/2% Senior Notes due 2008.
99.4 Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees for
9 1/2% Senior Notes due 2008.
----------------
* Management contract or compensatory plan or arrangement.
(b) Financial Statement Schedules:
None.
ITEM 22. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
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(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the
effective registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be
a new registration statement relating to the securities
offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(5) To respond to requests for information that is incorporated by
reference into this prospectus pursuant to Item 4, 10(b), 11,
or 13 of this form, within one business day of receipt of such
request, and to send the incorporated documents by first class
mail or other equally prompt means. This includes information
contained in documents filed subsequent to the effective date
of the registration statement through the date of responding
to the request.
(6) To supply by means of a post-effective amendment all
information concerning a transaction, and the company being
acquired involved therein, that was not the subject of and
included in the registration statement when it became
effective.
(7) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted against the
Registrant by such director, officer or controlling person in
connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Atlanta,
State of Georgia, on July 12, 2001.
AGCO CORPORATION
By: /s/ John M. Shumejda
-----------------------------------------------
John M. Shumejda
President and Chief Executive Officer
AG-CHEM EQUIPMENT CO., INC.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
AGCO VENTURES LLC
By: AGCO CORPORATION, its sole member
By: /s/ John M. Shumejda
----------------------------------------
John M. Shumejda
President and Chief Executive Officer
HAY & FORAGE INDUSTRIES
By: HESSTON VENTURES CORPORATION
By: /s/ Donald R. Millard
----------------------------------------
Donald R. Millard
President
By: AGCO VENTURES LLC
By: AGCO CORPORATION, its sole member
By: /s/ John M. Shumejda
--------------------------------------
John M. Shumejda
President and Chief Executive Officer
HESSTON VENTURES CORPORATION
By: /s/ Donald R. Millard
-----------------------------------------------
Donald R. Millard
President
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AG-CHEM MANUFACTURING CO., INC.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
AG-CHEM SALES CO., INC.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
AG-CHEM EQUIPMENT INTERNATIONAL, INC.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
LOR*AL PRODUCTS, INC.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
AG-CHEM EQUIPMENT CANADA, LTD.
By: /s/ R.A. Hess
-----------------------------------------------
Ron A. Hess
President
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AGCO CORPORATION
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ Robert J. Ratliff Chairman of the Board July 12, 2001
---------------------------
Robert J. Ratliff
/s/ John M. Shumejda President and Chief Executive Officer, Director July 12, 2001
--------------------------- (Principal Executive Officer)
John M. Shumejda
/s/ Donald R. Millard Senior Vice President and Chief Financial Officer July 12, 2001
--------------------------- (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Henry J. Claycamp Director July 12, 2001
---------------------------
Henry J. Claycamp
/s/ Wolfgang Deml Director July 12, 2001
---------------------------
Wolfgang Deml
/s/ Gerald B. Johanneson Director July 12, 2001
---------------------------
Gerald B. Johanneson
/s/ Anthony D. Loehnis Director July 12, 2001
---------------------------
Anthony D. Loehnis
/s/ Wolfgang Sauer Director July 12, 2001
---------------------------
Wolfgang Sauer
/s/ W. Wayne Booker Director July 12, 2001
---------------------------
W. Wayne Booker
/s/ Curtis E. Moll Director July 12, 2001
---------------------------
Curtis E. Moll
/s/ David E. Momot Director July 12, 2001
---------------------------
David E. Momot
/s/ Hendrikus Visser Director July 3, 2001
---------------------------
Hendrikus Visser
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AG-CHEM EQUIPMENT CANADA, LTD.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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AG-CHEM EQUIPMENT CO., INC.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President and Director July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
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AG-CHEM EQUIPMENT INTERNATIONAL, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities indicated and as of the dates below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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AG-CHEM MANUFACTURING CO., INC.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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AG-CHEM SALES CO., INC.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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AGCO VENTURES LLC
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ Robert J. Ratliff Chairman of the Board of AGCO Corporation* July 12, 2001
------------------------------------
Robert J. Ratliff
/s/ John M. Shumejda President and Chief Executive Officer, Director of July 12, 2001
------------------------------------ AGCO Corporation*
John M. Shumejda (Principal Executive Officer)
/s/ Donald R. Millard Senior Vice President and Chief Financial Officer of July 12, 2001
------------------------------------ AGCO Corporation*
Donald R. Millard (Principal Financial Officer and Principal
Accounting Officer)
* AGCO Corporation is the sole member of AGCO Ventures LLC
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HAY & FORAGE INDUSTRIES
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ Robert J. Ratliff Chairman of the Board of AGCO Corporation* July 12, 2001
------------------------------------
Robert J. Ratliff
/s/ John M. Shumejda President and Chief Executive Officer, Director of July 12, 2001
------------------------------------ AGCO Corporation*
John M. Shumejda (Principal Executive Officer)
/s/ Donald R. Millard Senior Vice President and Chief Financial Officer of July 12, 2001
------------------------------------ AGCO Corporation,* and President and Director of
Donald R. Millard Hesston Ventures Corporation**
(Principal Financial Officer and Principal Accounting
Officer)
* AGCO Corporation is the sole member of AGCO Ventures LLC, which is a partner
of Hay & Forage Industries
** Hesston Ventures Corporation is a partner of Hay & Forage Industries
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HESSTON VENTURES CORPORATION
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ Donald R. Millard President and Director July 12, 2001
------------------------------------ (Principal Executive Officer, Principal Financial
Donald R. Millard Officer and Principal Accounting Officer)
/s/ David K. Williams Treasurer and Director July 12, 2001
------------------------------------
David K. Williams
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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LOR*AL PRODUCTS, INC.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and as of the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ R.A. Hess President July 12, 2001
------------------------------------ (Principal Executive Officer)
Ron A. Hess
/s/ Donald R. Millard Vice President July 12, 2001
------------------------------------ (Principal Financial Officer and Principal
Donald R. Millard Accounting Officer)
/s/ Stephen D. Lupton Director July 12, 2001
------------------------------------
Stephen D. Lupton
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EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
---------------------------------------------------------------------------------------------------------
1.1 Purchase Agreement, dated April 11, 2001, among AGCO Corporation, Credit Suisse First Boston
Corporation, Bear, Stearns & Co. Inc. and SunTrust Equitable Securities
3.1 Certificate of Incorporation of AGCO Corporation incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 1996.
3.2 Certificate of Designation for Class A Convertible Preferred Stock incorporated by reference
to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
3.3 By-Laws of AGCO Corporation incorporated by reference to the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1997.
4.1 Rights Agreement, as amended, between and among AGCO Corporation and SunTrust Bank, as
rights agent, dated as of April 27, 1994 incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1994 and the Registrant's Form
8-A/A dated August 8, 1999.
4.2 Indenture between AGCO Corporation and SunTrust Bank, as Trustee, dated as of March 20,
1996, incorporated by reference to the Registrant's Annual Report on Form 10-K for the year
ended December 31, 1995.
4.3 Indenture among AGCO Corporation, as Issuer, the Guarantors named therein, and SunTrust
Bank, as Trustee, dated as of April 17, 2001, incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
4.4 Registration Rights Agreement, dated April 11, 2001, among AGCO Corporation, Credit Suisse
First Boston Corporation, Bear, Stearns & Co. Inc. and SunTrust Equitable Securities,
incorporated by reference to the Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 31, 2001.
4.5 Form of 9 1/2% Senior Note due 2008 (included in Exhibit 4.3)
5.1 Opinion of Troutman Sanders LLP.
10.1 1991 Stock Option Plan, as amended, incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1998.*
10.2 Form of Stock Option Agreements (Statutory and Nonstatutory) incorporated by reference to
the Registrant's Registration Statement on Form S-1 (No. 33-43437) dated April 16, 1992.*
10.3 Amended and Restated Long-Term Incentive Plan (LTIP III) incorporated by reference to the
Registrant's Annual Report on Form 10-K for the year ended December 31, 2000.*
10.4 Nonemployee Director Stock Incentive Plan, as amended incorporated by reference to the
Registrant's Annual Report on Form 10-K for the year ended December 31, 1997.*
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10.5 Management Incentive Compensation Plan incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1995.*
10.6 2001 Stock Option Plan incorporated by reference to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended March 31, 2001.*
10.7 Credit Agreement dated as of April 17, 2001, among AGCO Corporation, Cooperatieve Centrale
Raiffeisen-Boerenleenbank B.A. and the other parties named therein incorporated by reference
to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
10.8 Employment and Severance Agreement by and between AGCO Corporation and Robert J. Ratliff
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1995.*
10.9 Employment and Severance Agreement by and between AGCO Corporation and John M. Shumejda
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1995.*
10.10 Employment and Severance Agreement by and between AGCO Corporation and Edward R. Swingle
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1999.*
10.11 Employment and Severance Agreement by and between AGCO Corporation and Norman L. Boyd
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.*
10.12 Employment and Severance Agreement by and between AGCO Corporation and Aaron D. Jones
incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.*
10.13 Receivables Purchase Agreement dated as of January 27, 2000 among AGCO Corporation, AGCO
Funding Corporation and Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., as
administrative agent, incorporated by reference to the Registrant's Annual Report on Form
10-K for the year ended December 31, 1999.
12.1 Statement re: Computation of Ratio of Earnings to Combined Fixed Charges.
23.1 Consent of Troutman Sanders LLP (included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP, independent public accountants.
23.3 Consent of KPMG LLP, independent certified public accountants, for financial statements of
AGCO Finance LLC.
23.4 Consent of KPMG LLP, independent certified public accountants, for financial statements of
Ag-Chem Equipment Co., Inc.
23.5 Consent of KPMG LLP, independent certified public accountants, for financial statements of
Redball, LLC.
25.1 Statement of Eligibility of Trustee on Form T-1.
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99.1 Form of Letter of Transmittal for 9 1/2% Senior Notes due 2008.
99.2 Form of Notice of Guaranteed Delivery for 9 1/2% Senior Notes due 2008.
99.3 Form of Letter to Clients for 9 1/2% Senior Notes due 2008.
99.4 Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees for
9 1/2% Senior Notes due 2008.
----------------------
* Management contract or compensatory plan or arrangement.
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