TABLE OF CONTENTS
Item 1.01 Entry Into a Material Definitive Agreement
On November 28, 2006, AGCO Corporation (the “Company”) entered into an Underwriting
Agreement (the “Underwriting Agreement”) with Morgan Stanley & Co. Incorporated and Goldman, Sachs
& Co., as representatives of the underwriters (collectively, the “Underwriters”) for the issuance
and sale by the Company of $175.0 million aggregate principal amount of the Company’s 1.25%
Convertible Senior Subordinated Notes due 2036 (the “Notes”), pursuant to the Company’s effective
Registration Statement on form S-3 (Registration No. 333-138964). The Notes are being sold to the
Underwriters at 100% of the principal amount per Note ($1,000), less an underwriting discount of
2.375% per Note. The Company also granted the Underwriters an option to purchase up to an
additional $26.25 million aggregate principal amount of Notes solely to cover over-allotments, if
any, which option was exercised in full by the Underwriters on November 29, 2006. The Notes were
issued pursuant to an Indenture dated December 4, 2006 (the “Indenture”), between the Company and
Union Bank of California, N.A. The Company received net proceeds from the sale of the Notes of
approximately $196.2 million.
The Notes bear interest at a rate of 1.25% per annum, commencing on December 4, 2006.
Interest on the Notes is payable semi-annually in arrears on December 15 and June 15 of each
year, beginning on June 15, 2007. The notes will mature on December 15, 2036 unless earlier
redeemed, repurchased or converted.
Holders may convert the Notes on or prior to the close of business on the scheduled trading
day immediately preceding September 15, 2036 only under the following circumstances: (1) during any
calendar quarter after the calendar quarter ending December 31, 2006, the closing sale price of the
Company’s common stock for each of 20 or more trading days in a period of 30 consecutive trading
days ending on the last trading day of the immediately preceding calendar quarter exceeds 120% of
the conversion price then in effect, (2) during the five business days after any five consecutive
trading day period in which the trading price per $1,000 principal amount of Notes for each day of
that period was less than 98% of the product of the closing sale price of the Company’s common
stock and the then applicable conversion rate, (3) if the Notes have been called for redemption, or
(4) if specified corporate events described in the Indenture occur.
In addition, holders may convert their Notes at any time on or after September 15, 2036 until
the close of business on the scheduled trading day immediately preceding the maturity date for the
Notes.
Upon conversion, holders of Notes will receive cash and, if applicable, shares of the
Company’s common stock, based on the sum of the “daily settlement amounts” described in the Indenture
for the 10 consecutive trading day period that begins on the second trading day after the relevant conversion date.
The initial conversion rate for the Notes, subject to adjustment, is 24.5525 shares of the
Company’s common stock per $1,000 principal amount of Notes (which represents an initial conversion
price of approximately $40.73 per share of the Company’s common stock). A holder that surrenders
Notes for conversion in connection with a fundamental change, as defined in the Indenture, that
occurs before December 15, 2013, may in certain circumstances be entitled to an increased conversion
rate.
On or after December 19, 2013, the Company may at any time, redeem the Notes, in whole or in
part, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus
any accrued and unpaid interest.
On each of December 15, 2013, December 15, 2016, December 15, 2021, December 15, 2026 and
December 15, 2031, holders of the Notes may require the Company to purchase all or a portion of
their
Notes at a purchase price equal to 100% of the principal amount of the Notes to be purchased,
plus any accrued and unpaid interest. Holders may also require the Company to repurchase all or a
portion of their Notes upon a fundamental change, as defined in the Indenture, at a repurchase
price equal to 100% of the principal amount of the Notes to be repurchased, plus any accrued and
unpaid interest.
The Notes are senior subordinated obligations of the Company and are subordinated to all of
the Company’s existing and future senior indebtedness and effectively subordinated to all debt and
other liabilities of the Company’s subsidiaries. The Notes are pari passu in right of payment with
the Company’s 6 7/8% Senior Subordinated Notes due 2014 and its 1 3/4% Convertible Senior
Subordinated Notes due 2033.
Copies of the Underwriting Agreement and the Indenture, which includes the form Note as an
exhibit thereto, are filed with this Current Report as Exhibit 1.1 and Exhibit 10.1, respectively,
and are incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
The information set forth above in response to Item 1.01 with respect to the Indenture
and the Notes is incorporated by reference into this Item 2.03.
Item 8.01. Other Events
In connection with the issuance and sale by the Company of the Notes, as described in
response to Item 1.01 of this Current Report, the following exhibits are filed with this Current
Report and are incorporated by reference into the Company’s Registration Statement (Registration
No. 333-138964) relating to the Notes: (i) the Underwriting Agreement (Exhibit 1.1 to this Current
Report); and (ii) certain information relating to Part II, Item 14. “Other Expenses of Issuance and
Distribution” of the Registration Statement (Exhibit 99.1 to this Current Report).
Item 9.01 Financial Statements and Exhibits
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Description of Exhibits |
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1.1
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Underwriting Agreement, dated November 28, 2006, by and among
AGCO Corporation, Morgan Stanley & Co. Incorporated and
Goldman, Sachs & Co., as representatives of the underwriters
named therein |
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10.1
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Indenture dated December 4, 2006, between AGCO Corporation
and Union Bank of California, N.A., as trustee |
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99.1
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Information relating to Part II, Item 14. “Other Expenses of
Issuance and Distribution” of the Registration Statement
(Registration No. 333-138964) |