corresp
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BRINKLEY DICKERSON
404.885.3822 telephone
404.962.6743 facsimile
brink.dickerson@troutmansanders.com
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TROUTMAN SANDERS LLP
Attorneys at Law
Bank of America Plaza
600 Peachtree Street, NE, Suite 5200
Atlanta, Georgia 30308-2216
404.885.3000 telephone
troutmansanders.com |
September 17, 2009
Cecilia Blye, Chief
Office of Global Security Risk
Division of Corporation Finance
Securities and Exchange Commission
Washington, D.C. 20549-7010
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Re: |
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AGCO Corporation
Form 10-K for the Fiscal Year Ended December 31, 2008
Filed February 27, 2009
File No. 1-12930 |
Ladies and Gentlemen:
On behalf of AGCO Corporation (the Company), we are providing responses to the Staffs
comment letter dated August 26, 2009. The comments relate to the Companys Form 10-K for the year
ended December 31, 2008. In this letter references to we refer to the Company. To facilitate
your review the Staffs comments have been reproduced, with the Companys responses following each
comment.
Comment #1
We note that Section 4(d) of the companys form of Employment and Severance Agreement
attached as Exhibit 10.1 to your Form 8-K dated December 10, 2007 contains a covenant of
non-competition within the Territory. We also note that Exhibit A includes Iran, Sudan
and Syria in the Territory, and that each of these countries appears to have an Agco
Recognised Distribution/Representative. We also note that according to Valtras website,
it has dealers in Iran and Sudan; and that, according to Massey Fergusons website, it has a
dealer in Syria. Finally, we note an April 2003 news article stating that your products are
sold in Iran, Syria and Sudan. Iran, Syria and Sudan are identified by the State Department
as state sponsors of terrorism, and are subject to U.S. economic sanctions and export
controls. Please describe to us the nature and extent of your past, current, and
anticipated contacts with Iran, Syria and Sudan, whether through affiliates, distributors,
or other direct or indirect arrangements. Your response should describe any products and
services you have provided into those countries, and any
agreements, commercial arrangements, or other contacts you have had with the governments of
those countries or entities controlled by those governments.
Cecilia Blye, Chief
September 17, 2009
Page 2
Response
The Company has in place an Export Controls and Sanctions Policy that governs sales into
countries that are subject to sanctions. This policy is applicable to both the parent company as
well as its domestic and foreign subsidiaries. The Companys Chief Compliance Officer reviews the
policy regularly with the appropriate staff members and believes that the Company and its
subsidiaries are in compliance with it.
To the Companys knowledge, from 2007 (the year in which the referenced Form 8-K was filed) to date
neither the Company nor any of its U.S. subsidiaries sold products in or to Iran, Sudan or Syria.
To the extent that non-U.S. subsidiaries sold products to Iran, Sudan and Syria, to the Companys
knowledge they only sold foreign-made products containing less than 10% U.S. content. These sales
are of farm machinery and related replacement parts and are made through distributors. In each
case the distributor operates entirely independently of the Company and its U.S. subsidiaries, and
to the Company s knowledge no U.S. Person has any involvement with the sales.
Comment #2
Please discuss the materiality of your contracts with Iran, Syria, and Sudan, and whether
those contracts constitute a material investment risk for your security holders. You should
address materiality in quantitative terms, including the approximate dollar amounts of any
associated revenues, assets, and liabilities for the last three fiscal years and any
subsequent period. Also, address materiality in terms of qualitative factors that a
reasonable investor would deem important in making an investment decision, including the
potential impact of corporate activities upon a companys reputation and share value. As
you may be aware, various state and municipal governments, universities, and other investors
have proposed or adopted divestment or similar initiatives regarding investments in
companies that do business with state sponsors of terrorism. Your materiality analysis
should address the potential impact of the investor sentiment
evidenced by such actions directed toward companies that have operations associated with
Iran, Syria, and Sudan.
Response
In the aggregate, sales to Iran, Syria and Sudan aggregated approximately $11 million during
2008. The Companys total sales for 2008 were $8.4 billion, meaning that the sales to these three
countries aggregated less than .2% of total sales. As a consequence, these sales were immaterial
to the Companys results of operations and financial conditions. For 2009, the Companys forecast
of sales into these three countries is even lower at approximately $3 million.
Cecilia Blye, Chief
September 17, 2009
Page 3
We appreciate that some investors have proposed or adopted terrorism related investment
policies. To our knowledge, none of the Companys shareholders have ever raised the Companys
sales to Iran, Syria and Sudan as a concern. In addition, given the small size of these sales, we
do not believe that they are likely to be a concern in the future.
* * * * *
Should the Staff have questions about any of the Companys responses or have additional
comments, please feel free to contact me.
Sincerely,
/s/ W. Brinkley Dickerson, Jr.
W. Brinkley Dickerson, Jr.
WBD, Jr./lb
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cc: |
Debra Kuper
Andy Beck
Martin Richenhagen |
AGCO CORPORATION
September 17, 2009
AGCO Corporation acknowledges that:
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The Company is responsible for the adequacy and accuracy of the disclosure in its
filings under the Securities Exchange Act of 1934; |
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Staff comments or changes to disclosure in response to Staff comments do not
foreclose the Commission from taking any action with respect to the filings; and |
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The Company may not assert Staff comments as a defense in any proceeding initiated
by the Commission or any person under the Federal Securities Laws of the United
States. |
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Sincerely yours,
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/d/ Debra E. Kuper |
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Debra E. Kuper
Vice President, General Counsel and
Corporate Secretary |
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