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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Farm Family Holdings, Inc.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock ($.01 par value)
- --------------------------------------------------------------------------------
(Title of Class of Securities)
307901108
- -------------------------------------------------------------------------------
(CUSIP Number)
Jeffery H. Kirby, Esq., Administrator and Secretary/Treasurer
New York Farm Bureau Service Company, Inc.
Route 9W, Glenmont, NY 12077
(518) 436-8495
- -------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
April 6, 1999
--------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [_].
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
SCHEDULE 13D
- ---------------------------------
CUSIP No. 307901108
---------
- ---------------------------------
- --------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
New York Farm Bureau Service Company, Inc.
- --------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) X
(b) [ ]
- --------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- --------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ---------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 341,599 shares
BENEFICIALLY ---------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH None
REPORTING ---------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 341,599 shares
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
None
- --------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
341,599 shares
- --------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
Not Applicable
- --------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.6%
- --------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- --------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- ---------------------------------
CUSIP No. 307901108
---------
- ---------------------------------
- --------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
New York Farm Bureau, Inc.
- --------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) X
(b) [_]
- --------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- --------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [_]
- --------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 341,599 shares
BENEFICIALLY ----------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH None
REPORTING ----------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 341,599 shares
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
- --------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
341,599 shares
- --------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
Not Applicable [_]
- --------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.6%
- --------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
HC
- --------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Item 1. Security and Issuer
- ------ -------------------
This statement relates to the Common Stock, par value $.01 per share
(the "Common Stock") of Farm Family Holdings, Inc., a Delaware corporation (the
"Issuer"), which has its principal executive offices at 344 Route 9W, Glenmont,
NY 12077.
Item 2. Identity and Background
- ------ -----------------------
This Statement is filed by New York Farm Bureau Service Company, Inc.,
a New York corporation (the "Service Company"), and New York Farm Bureau, Inc.,
a New York corporation ("NYFB").
The Service Company is a privately-held corporation and a wholly-owned
subsidiary of NYFB which engages in no activities apart from holding the Common
Stock and other preferred stock. The Service Company's principal business and
office address is Route 9W, Glenmont, NY 12077.
NYFB is a not-for-profit corporation engaged in supporting farming and
agriculture in New York State. The principal business and office address of
NYFB is Route 9W, Glenmont, NY 12077.
Information with respect to the executive officers and directors of
the Service Company and NYFB, including (a) name, (b) business address, (c)
present principal occupation or employment and the name, principal business and
address of any corporation or other organization in which such employment is
conducted and (d) citizenship, is listed on the Schedules attached hereto as
Annexes A and B, respectively, which are incorporated herein by reference.
Neither the Service Company or NYFB, nor, to the best of their
knowledge, any executive officer or director of any of them, has during the last
five years been convicted in any criminal proceeding (excluding traffic
violations or similar misdemeanors) or been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and, as a result of
such proceeding, was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
Item 3. Source and Amount of Funds or other Consideration
- ------ -------------------------------------------------
The Issuer and the Service Company entered into an Amended and
Restated Option Purchase Agreement dated February 26, 1998, as amended by
Amendment No. 1 dated April 28, 1998, and as further amended by Amendment No. 2
dated January 14, 1999 (the "Amended and Restated Option Purchase Agreement"),
and also entered into an Agreement and Plan of Reorganization dated February 26,
1998 (the transactions contemplated by the foregoing hereafter collectively
referred to as the "Reorganization"). The Amended and Restated Option Purchase
Agreement and the Agreement and Plan of Reorganization dated February 26, 1998
are qualified by reference to the full text of these agreements which are
referred to as Exhibit 2 and Exhibit 3 respectively.
<PAGE>
Under the Reorganization, the Issuer acquired from the Service Company
all of its 23,783 shares of the common stock of Farm Family Life Insurance
Company (the "Life Insurance Company") representing 39.631 percent of the Life
Insurance Company's issued and outstanding shares. The remaining issued and
outstanding shares in the Life Insurance Company were acquired by the Issuer
from the other parties to the Amended and Restated Option Purchase Agreement.
In consideration for the Service Company's 23,783 shares of the common
stock of the Life Insurance Company, the Service Company received 339,578 shares
of Common Stock and 64,682 shares of 6-1/8% Voting Preferred Stock, Series A
(the "Preferred Stock") of the Issuer.
Item 4. Purpose of Transaction
- ------ ----------------------
The Service Company acquired an aggregate 339,578 shares of Common
Stock and 64,682 shares of Preferred Stock of the Issuer as consideration for
the sale of the Service Company's interest in the Life Insurance Company to the
Issuer. The remaining shareholders of the Life Insurance Company also received
shares of Common and Preferred Stock from the Issuer in exchange for and in
proportion to their respective interests in the Life Insurance Company.
As an integral part of the Reorganization, and as contemplated by the
Amended and Restated Option Purchase Agreement, the Service Company will
distribute (the "Transfer") all of its assets in liquidation to NYFB, including
the Common and Preferred Stock received from the Issuer, in accordance with the
terms of the Agreement and Plan of Reorganization dated February 26, 1998. NYFB
will hold the Issuer's stock as an investment and is limited by law in its right
to resell the stock. No dissolution of NYFB is contemplated.
Subject to the foregoing and to the Transfer, neither the Service
Company nor NYFB has any present plans or proposals which relate to or would
result in:
(a) The acquisition by any person of additional securities of the Issuer, or
the disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as a merger, reorganization
or liquidation, involving the Issuer or any of its subsidiaries;
(c) A sale or transfer of a material amount of assets of the Issuer or any of
its subsidiaries;
(d) Any change in the present board of directors or management of the Issuer,
including any plans or proposals to change the number or term of directors or to
fill any existing vacancies on the board;
(e) Any material change in the present capitalization or dividend policy of
the Issuer;
(f) Any other material change in the Issuer's business or corporate structure;
<PAGE>
(g) Changes in the Issuer's charter, bylaws or instruments corresponding
thereto or other actions which may impede the acquisition of control of the
Issuer by any person;
(h) Causing a class of securities of the Issuer to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association;
(i) A class of equity securities of the Issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934; or
(j) Any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer
- ------ ------------------------------------
(a) As of the date hereof and subject to the arrangements described in Item 6
below, the Service Company is the direct beneficial owner of 341,599 shares of
Common Stock of the Issuer, representing approximately 5.6% of the issued and
outstanding shares of the Common Stock of the Issuer. NYFB is the indirect
beneficial owner of such 341,599 shares of Common Stock of the Issuer,
representing approximately 5.6% of the issued and outstanding shares of the
Common Stock of the Issuer.
To the best knowledge of the Service Company and NYFB, two of the
executive officers of both corporations (who are not directors) beneficially own
Common Stock of the Issuer other than in their capacity as executive officers of
such corporations. John W. Lincoln, President of the Service Company and
President of NYFB, owns 167 shares of Common Stock of the Issuer, which includes
113 shares as to which voting and investment power are shared with S. Anne
Lincoln, representing approximately .00002% of the issued and outstanding shares
of the Common Stock of the Issuer. Jon R. Greenwood, Vice President of the
Service Company and Vice President of NYFB, owns 1,479 shares of Common Stock of
the Issuer, as to which voting and investment power are shared with Linda R.
Greenwood, representing approximately .0002% of the issued and outstanding
shares of the Common Stock of the Issuer.
(b) The Service Company has the power to vote or to direct the vote and the
power to dispose or to direct the disposition of the 341,599 shares of
Common Stock of the Issuer which it beneficially owns.
To the best knowledge of the Service Company and NYFB, none of their
respective executive officers or directors has the power to vote or to direct
the vote or to dispose or to direct the disposition of any shares of the Common
Stock beneficially owned by such corporations (other than in his or her capacity
as an executive officer or director of such corporations).
(c) Other than the acquisition of the 339,578 shares of Common Stock of the
Issuer pursuant to the Reorganization, neither the Service Company nor NYFB has
effected any transactions in the Common Stock of the Issuer in the past 60 days.
To the best knowledge of the Service Company and NYFB, none of their
respective executive officers or directors has effected any transactions in
shares of the Common Stock of the Issuer during the past 60 days.
<PAGE>
(d) Subject to the arrangements described in Item 6 below, to the best
knowledge of the Service Company and NYFB, no other person has the right to
receive or the power to direct the receipt of dividends from, or the proceeds
from the sale of the shares of the Common Stock of the Issuer beneficially owned
by such corporations.
(e) Not Applicable.
Item 6. Contracts, Arrangements, Understandings
- ------ or Relationships with Respect
to Securities of the Issuer
---------------------------------------
Except as described below, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) between the Service Company
and NYFB or, to the best of their knowledge, any executive officer or director
of either of them and any other person with respect to any securities of the
Issuer, including any contract, arrangement, understanding or relationship
concerning the transfer or the voting of any securities of the Issuer, finder's
fees, joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profits or loss, or the giving or withholding of proxies.
Pursuant to the Reorganization, the Issuer has agreed that the Service
Company may transfer record ownership of the 339,578 shares of Common Stock of
the Issuer held by the Service Company to NYFB in liquidation. The Service
Company intends to do so.
Pursuant to the Registration Rights Agreement dated as of April 6,
1999 between the Issuer and the shareholders of the Issuer including the Service
Company (the "Registration Rights Agreement"), the Service Company is entitled
to certain registration rights with respect to the shares beneficially owned by
the Service Company. The description of the Registration Rights Agreement is
qualified by reference to the full text of the agreement which is included as
Exhibit 4 to this filing.
Item 7. Material to Be Filed as Exhibits
- ------ --------------------------------
1. Written Agreement of the Service Company and NYFB relating to the filing of
this Amendment as required by Rule 13d-l(f).
2. Amended and Restated Option Purchase Agreement dated as of February 26,
1998, as amended, between the Issuer, the Service Company and the remaining
shareholders of the Life Insurance Company.*
3. Agreement and Plan of Reorganization dated as of February 26, 1998, between
the Issuer and the Service Company.
4. Registration Rights Agreement dated as of April 6, 1999, between the Issuer
and the shareholders of the Issuer including the Service Company.
* This document was filed with the Securities and Exchange Commission by the
Issuer as Annex A to its Proxy Statement Regarding Special Meeting on Form
DEFS14A filed on February 23, 1999, and is incorporated herein by reference.
<PAGE>
Signature
- ---------
After reasonable inquiry and to the best of our knowledge and belief,
we certify that the information set forth in this statement is true, correct and
complete.
New York Farm Bureau Service Company, Inc.
April 16, 1999 By: /s/ Jeffery H. Kirby
-------------------------------
Jeffery H. Kirby
Administrator and Secretary / Treasurer
New York Farm Bureau, Inc.
April 16, 1999 By: /s/ Jeffery H. Kirby
-------------------------------
Jeffery H. Kirby
Administrator and Secretary / Treasurer
<PAGE>
Annex A
-------
NEW YORK FARM BUREAU SERVICE COMPANY, INC.
<TABLE>
<CAPTION>
Name and Business Address
(all business addresses are:
New York Farm Bureau Service
Company, Inc.
Route 9W
Glenmont, NY 12077
unless otherwise indicated) Present Principal Occupation or Citizenship
- ---------------------------- Employment
<S> <C> <C>
DIRECTORS
Paul Zittel Farmer USA
W. Bruce Krenning Farmer USA
Norbert Amberg Farmer USA
Robert Chadeayne Farmer USA
April Martin Farmer USA
Douglas W. Shelmidine Farmer USA
Onalie Beckstead Farmer USA
Christine K. Nellis Farmer USA
Roger Hamilton Farmer USA
Roderick O. Dressel, Jr. Farmer USA
Lyle C. Wells Farmer USA
Judi Whittaker Farmer USA
Dale Mattoon Farmer USA
EXECUTIVE OFFICERS
(who are not Directors)
John W. Lincoln Farmer USA
President
Jon R. Greenwood Farmer USA
Vice President
Jeffery H. Kirby Administrator USA
Administrator and
Secretary/Treasurer
Leslie R. Miller Director of Finance USA
Assistant Treasurer
</TABLE>
<PAGE>
Annex B
-------
NEW YORK FARM BUREAU, INC.
<TABLE>
<CAPTION>
Name and Business Address
(all business addresses are:
New York Farm Bureau, Inc.
Route 9W
Glenmont, NY 12077
unless otherwise indicated) Present Principal Occupation or Citizenship
- --------------------------- Employment
<S> <C> <C>
DIRECTORS
Paul Zittel Farmer USA
W. Bruce Krenning Farmer USA
Norbert Amberg Farmer USA
Robert Chadeayne Farmer USA
April Martin Farmer USA
Douglas W. Shelmidine Farmer USA
Onalie Beckstead Farmer USA
Christine K. Nellis Farmer USA
Roger Hamilton Farmer USA
Roderick O. Dressel, Jr. Farmer USA
Lyle C. Wells Farmer USA
Judi Whittaker Farmer USA
Dale Mattoon Farmer USA
EXECUTIVE OFFICERS
(who are not Directors)
John W. Lincoln Farmer USA
President
Jon R. Greenwood Farmer USA
Vice President
Jeffery H. Kirby Administrator USA
Administrator and
Secretary/Treasurer
Leslie R. Miller Director of Finance USA
Assistant Treasurer
</TABLE>
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibit Document Page
No.
- -------- ------------------------------------------------------------- -----------
<S> <C> <C>
1 Written Agreement of the Service Company and NYFB relating to [ 1 ]
the filing of this Amendment as required by Rule 13d-l(f).
2 Amended and Restated Option Purchase Agreement dated as of
February 26, 1998, as amended, between the Issuer, the Service
Company and the remaining shareholders of the Life Insurance
Company.*
3 Agreement and Plan of Reorganization dated as of February 26, [ 2 ]
1998, between the Issuer and the Service Company.
4 Registration Rights Agreement dated as of April 6, 1999, [ 12 ]
between the Issuer and the shareholders of the Issuer including
the Service Company.
* This document was filed with the Securities and Exchange
Commission by the Issuer as Annex A to its Proxy Statement
Regarding Special Meeting on Form DEFS14A filed on February 23,
1999, and is incorporated herein by reference.
</TABLE>
<PAGE>
Exhibit 1
---------
The undersigned agree that the foregoing Statement on Schedule 13D,
dated April 16, 1999 is being filed with the Securities and Exchange Commission
on behalf of New York Farm Bureau Service Company, Inc., a New York corporation,
and New York Farm Bureau, Inc., a New York not-for-profit corporation.
New York Farm Bureau Service Company,
Inc.
April 16, 1999 By: /s/ Jeffery H. Kirby
---------------------------------
Jeffery H. Kirby
Administrator and Secretary/Treasurer
New York Farm Bureau, Inc.
April 16, 1999 By: /s/ Jeffery H. Kirby
---------------------------------
Jeffery H. Kirby
Administrator and Secretary/Treasurer
<PAGE>
EXHIBIT 3
AGREEMENT AND PLAN OF REORGANIZATION
------------------------------------
AGREEMENT AND PLAN OF REORGANIZATION (this "Agreement"), dated as of
February 26, 1998, by and between Farm Family Holdings, Inc. ("FFH") and New
York Farm Bureau Service Company, Inc.(the "Company"),
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, FFH and the Company are parties to that certain Option Purchase
Agreement, dated as of February 14, 1996, as amended by Amendment No. 1, dated
as of April 22, 1997, and as further amended by and restated as the Amended and
Restated Option Purchase Agreement, dated as of February 26, 1998 (the "Option
Agreement") pursuant to which FFH has the option to acquire from the Company all
shares of stock in Farm Family Life Insurance Company ("Life") held by the
Company (the "Option"), such shares representing substantially all of the assets
of the Company, in exchange for FFH Common Stock and FFH Voting Preferred Stock
(collectively, the "FFH Stock");
WHEREAS, on April 30, 1997 FFH first notified the Company that it proposes
to exercise the Option;
WHEREAS, FFH thereafter engaged Salomon Brothers Inc. ("Salomon") to
determine the "Fair Market Value per Share" of the Life stock, pursuant to
section 3(a) of the Option Agreement;
WHEREAS, following receipt of Salomon's valuation of the Life stock (the
"Optionee Valuation"), FFH provided the Company with a copy of the Optionee
Valuation and notice that it continued to propose to exercise the Option, in
accordance with section 3(a) of the Option Agreement;
WHEREAS, the Company and the other shareholders of Life (collectively, the
"Shareholders") disagreed with the Optionee Valuation and hired Donaldson,
Lufkin & Jenrette Securities Corp. to value the Life stock (the "Shareholder
Valuation");
<PAGE>
WHEREAS, FFH disagreed with the Shareholder Valuation, and the parties have
endeavored to resolve their valuation differences pursuant to section 3 of the
Option Agreement;
WHEREAS, concurrent herewith the parties have amended and restated the
Option Agreement;
WHEREAS, upon issuance of a notice of election to exercise the Option (the
"Exercise Notice") pursuant to section 4(a) of the Option Agreement, FFH shall
be bound to acquire the Company's shares of stock in Life in exchange for the
FFH Stock in accordance with the terms of the Option Agreement, subject only to
(i) the approval of the shareholders of FFH as provided for in section 14
thereof and (ii) the satisfaction of the closing conditions set forth in section
7(a) thereof, and provided that the Option Agreement is not terminated pursuant
to section 16 thereof;
WHEREAS, in order to obtain the approval of its shareholders, FFH is
required to issue a proxy statement to its shareholders seeking their approval;
and
WHEREAS, the parties wish to set forth their understanding of certain
matters pertaining to the acquisition by FFH of the Life stock held by the
Company;
NOW, THEREFORE, in consideration of the foregoing and the respective
covenants, agreements and conditions hereinafter set forth, and intending to be
legally bound hereby, provided FFH shall have issued the Exercise Notice, the
parties hereto agree as follows:
1. Following receipt of the Exercise Notice, (i) the Board of
Directors of the Company shall adopt a resolution generally in
the form of Exhibit A attached hereto (or such comparable form of
resolution that effects the same result), authorizing the Company
to distribute all of its assets in liquidation as part of an
overall plan of reorganization, (ii) the Company shall adopt a
Plan of Distribution generally in the form of Exhibit B attached
hereto (or such comparable form of plan of distribution that
effects the same result) and (iii) in due
2
<PAGE>
course the Company shall seek the approval of its shareholders
therefor.
2. FFH shall prepare a proxy statement for the purpose of obtaining
shareholder approval of the acquisition of the Life stock
pursuant to the Option Agreement, and shall provide the Company
and its counsel a reasonable opportunity for review and comment.
3. Following FFH shareholder approval and the satisfaction or waiver
of the other closing conditions set forth in the Option
Agreement, the exchange of shares will close (the "Closing") in
accordance with the terms of the Option Agreement.
4. Following receipt of the FFH Stock, as an integral part of the
plan of reorganization described in this Agreement, the Company
shall distribute all of its assets in liquidation in accordance
with the Plan of Distribution, provided that (i) the Company
--------
shall have obtained any requisite shareholder approvals and (ii)
any conditions to dissolution pursuant to the Plan of
Distribution shall have been satisfied (or waived in the sole
discretion of the Board of Directors of the Company).
5. (a) It is the intent of the parties hereto that the transactions
contemplated hereby will qualify as a "reorganization" within the
meaning of section 368(a)(1)(C) of the Internal Revenue Code of
1986, as amended (the "Code"), and the parties hereby agree,
provided steps 1 through 4 above shall have been completed as
contemplated, to file their tax returns in a manner consistent
with such classification and otherwise to act in a manner
consistent therewith.
(b) Upon advance written notice, the Company shall grant FFH
reasonable access to information contained in the records and
files of the Company concerning its federal income tax attributes
as the same shall be
3
<PAGE>
relevant to FFH under sections 362 and 381 of the Code.
6. (a) The parties agree to execute such other documents and to
take such other actions or corporate proceedings as may be
necessary or desirable to carry out the terms hereof.
(b) FFH further agrees to deliver, at Closing, a representation
letter in the form previously agreed upon by counsel to the
parties (subject to such revisions as unforeseen circumstances
occurring hereafter may require) so as to facilitate the
rendering of an opinion by tax counsel to the Company as to the
federal income tax consequences of the transactions contemplated
hereby.
7. The parties may amend, modify and supplement this Agreement in
such manner as may be agreed upon by them in writing.
8. This Agreement may be executed in one or more written
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the
4
<PAGE>
same instrument and which shall be effective as of the date first
above written.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
FARM FAMILY HOLDINGS, INC.
By ________________________
Name:
Title:
Date:
NEW YORK FARM BUREAU SERVICE
COMPANY, INC.
By ________________________
Name:
Title:
Date:
5
<PAGE>
Exhibit A
---------
BOARD OF DIRECTORS RESOLUTION OF
NEW YORK FARM BUREAU SERVICE COMPANY, INC.
The Board of Directors (the "Board") of New York Farm Bureau Service Company,
Inc., a New York corporation (the "Company"), hereby adopts the following
resolution:
RESOLVED, that the Company be voluntarily dissolved pursuant to the Plan
of Distribution of the Company approved by the Board of Directors of the
Company and in accordance with Section 1001 of the Business Corporation Law
of the State of New York; provided, however, that, unless otherwise
-------- -------
determined by the Board, no such dissolution under the Plan of Distribution
shall take place unless the Company has obtained a satisfactory tax opinion
of Dewey Ballantine LLP as to the federal income tax consequences of the
acquisition by Farm Family Holdings, Inc. of the stock of Farm Family Life
Insurance Company held by the Company and the distribution of assets in
liquidation of the Company following such acquisition as contemplated
hereby; and
FURTHER RESOLVED, that the proper officers of the Company be, and they
hereby are, authorized and directed, in the name of and on behalf of the
Company, to execute and deliver a certificate of dissolution of the
Company, and to execute and deliver such other agreements, certificates and
documents as are contemplated by the immediately preceding resolution, in
the forms approved by the officers of the Company executing such
instruments, such approval to be conclusively evidenced by such officer's
execution thereof.
Dated: ______________
6
<PAGE>
Exhibit B
---------
NEW YORK FARM BUREAU SERVICE COMPANY, INC.
AMENDED PLAN OF DISTRIBUTION
This Plan of Distribution (the "Plan") is for the purpose of effecting
the dissolution and distribution of assets in liquidation of New York Farm
Bureau Service Company, Inc., a New York corporation (the "Company"), following
the closing of the Acquisition (as defined in Section 4 below) in accordance
with and pursuant to the provisions of the New York Business Corporation Law
("NYBCL") and Section 368(a) of the Internal Revenue Code of 1986, as amended,
in substantially the following manner:
1. Effective Date. Subject to Section 9 below, the Plan shall become
--------------
effective after the date (the "Effective Date") as of which both of the
following shall have occurred: (a) the adoption of the Plan by the
affirmative vote of the sole holder of the outstanding shares of the stock
of the Company (the "Shareholder") and (b) the closing of the Acquisition
(as defined in Section 4 below), it being the express contemplation of this
Plan that the shareholder approval described in clause (a) hereof shall
occur in advance of, and conditional on, the closing described in clause (b)
hereof.
2. Cessation of Business. After the Effective Date, the Company shall not
---------------------
engage in any business activities except for the purposes of (i) prosecuting
or defending lawsuits by or against the Company, (ii) enabling the Company
gradually to settle and close its business, dispose of and convey its
property, discharge liabilities and wind up its business affairs and (iii)
making the Liquidating Distribution (as hereinafter defined) and
distributing its remaining assets, if any, in accordance with the Plan. The
Board of Directors of the Company (the "Board") and, at its pleasure, the
officers, shall continue in office solely for these purposes. After a
certificate of dissolution of the Company (the "Certificate of Dissolution")
is filed with the New York State Department of State, the Company will not
plan to hold any further annual meetings of its Shareholders.
3. Dissolution. As promptly as practicable after the Effective Date and upon
-----------
the filing of the Certificate of Dissolution with the New York State
Department of State, the Company shall be dissolved pursuant to Section 1003
of the NYBCL.
4. Disposition of Assets. As part of an overall plan of reorganization, the
---------------------
Company has entered into (a) the Option Purchase Agreement dated as of
February 14, 1996 (as amended by Amendment No.1 dated as of April 22, 1997,
as further amended by and restated as the Amended and Restated Option
Purchase Agreement dated as of February 26, 1998 and as further amended by
Amendment No. 1 dated as of April 28, 1998) between the Company (as a
shareholder of Farm Family Life Insurance
7
<PAGE>
Company ("FF Life"), a New York domiciled stock life insurance company)) and
Farm Family Holdings, Inc., a Delaware corporation ("Holdings") providing
Holdings with an option to acquire the Company's stockholdings in FF Life
(such stockholdings constituting substantially all of the assets of the
Company) in exchange for shares of Holdings Common Stock and Voting
Preferred Stock (collectively, the "Holdings Shares") (the transaction by
which Holdings acquires the FF Life stock is referred to herein as the
"Acquisition") and (b) an Agreement and Plan of Reorganization between
Holdings and the Company, dated as of February 26, 1998, setting forth the
common understanding and agreement of the Company and Holdings as to certain
matters pertaining to the Acquisition in the event Holdings shall exercise
its option. This Plan is adopted pursuant to such Agreement and Plan of
Reorganization. After the Effective Date, the Company shall have continuing
authority to sell, lease, exchange or otherwise convert all or any part of
its assets as contemplated by the terms and provisions of the Plan.
5. Payment of Debts. The Company shall pay or make proper provision for the
----------------
payment of all known or ascertainable liabilities of the Company, including
all amounts estimated by the Board to be necessary, appropriate or
desirable, in its absolute discretion, for the payment of estimated
expenses, taxes and contingent liabilities (including expenses of
dissolution, liquidation and termination of existence), all as provided
under applicable law.
6. Liquidating Distribution. The Company shall distribute to the Shareholder
------------------------
all of its properties, including the Holdings Shares, subject to such
liabilities as may exist (the "Liquidating Distribution"). The Liquidating
Distribution may be made in a series of distributions and will be made in
Holdings Shares (to the extent thereof) but otherwise may be in cash or
kind, in such manner and at such time or times as the Board, in its absolute
discretion (but subject to the requirements of New York law), may determine.
7. Cancellation of Stock. The Liquidating Distribution shall be in complete
---------------------
redemption and cancellation of all of the outstanding common stock, no par
value ("Common Stock"), of the Company. The Board may direct that the
Company's stock transfer books be closed at the close of business on the
record date fixed by the Board for the first or any subsequent installment
of any Liquidating Distribution as the Board, in its absolute discretion,
may determine (the "Record Date") and thereafter certificates representing
Common Stock shall not be assignable or transferable on the books of the
Company except by will, intestate succession or operation of law. The
Shareholder shall surrender stock certificates (or, if so required by the
Board in its absolute discretion, furnish indemnity bonds in case of lost or
destroyed certificates) as a condition to its receipt of any Liquidating
Distribution immediately following the Record Date.
8. Missing Shareholders. If any Liquidating Distribution to a Shareholder
--------------------
cannot be made, whether because the Shareholder cannot be located, has not
surrendered a certificate evidencing the Common Stock, as required
hereunder, or for any other reason, then the distribution to which such
Shareholder is entitled shall be transferred
8
<PAGE>
to and deposited with the state official authorized by the laws of the State
of New York to receive the proceeds of such distribution. The proceeds of
such distribution shall thereafter be held solely for the benefit of and for
ultimate distribution to such Shareholder as the sole equitable owner
thereof and shall escheat to the State of New York or be treated as
abandoned property in accordance with the laws of the State of New York. In
no event shall the proceeds of any such distribution revert to or become the
property of the Company.
9. Amendments. Notwithstanding the adoption of the Plan by the Company's
----------
Shareholder, the Board may modify or amend the Plan and, prior to the filing
of the Certificate of Dissolution with the Department of State of the State
of New York, may abandon the Plan, without further action by the Shareholder
to the extent permitted by New York law.
10. Indemnification. The Company shall continue to indemnify its officers,
---------------
directors, employees and agents in accordance with applicable law, its
articles and bylaws and any contractual arrangements for actions taken in
connection with the Plan and the winding up of the affairs of the Company.
The Board and the trustees, in their absolute discretion, are authorized to
obtain and maintain insurance for the benefit of such officers, directors,
employees and agents to the extent permitted by law.
11. Power of Board of Directors. The Board and, if authorized by the Board,
---------------------------
the officers, shall have authority to do or authorize any and all acts and
things as provided for in the Plan and any and all such further acts and
things as they may consider desirable to carry out the purposes of the
Plan, including the execution and filing of all such certificates,
documents, information returns, tax returns, and other documents which may
be necessary or appropriate to implement the Plan. The Board may authorize
such variations from or amendments to the provisions of the Plan as may be
necessary or appropriate to effectuate the complete liquidation and
dissolution of the Company and the distribution of its assets to its
Shareholders in accordance with the NYBCL. The death, resignation, or other
disability of any director or officer of the Company shall not impair the
authority of the surviving or remaining director(s) or officer(s) to
exercise any of the powers provided for in the Plan. Upon such death,
resignation or other disability, the surviving or remaining director(s),
or, if there be none, to the extent permitted by law the surviving or
remaining officer(s) shall have authority to fill the vacancy or vacancies
so created, but the failure to fill such vacancy or vacancies shall not
impair the authority of the surviving or remaining director(s) or
officer(s) to exercise any of the powers provided for in the Plan. In
connection with and for the purpose of implementing and assuring completion
of the Plan, the Company may, in the absolute discretion of the Board, pay
to the Company's officers, directors and employees, or any of them,
compensation or additional compensation above their regular compensation,
in money or property, in recognition of the extraordinary efforts they, or
any of them, will be required to undertake or actually undertake, in
successful implementation of the Plan. Adoption of the Plan by the
Shareholder shall constitute the approval of the Shareholder of the payment
of any such compensation. The dissolution of the Company shall not subject
its directors or officers to standards of conduct different from those
prescribed by or pursuant to the
9
<PAGE>
NYBCL. Compliance by the Company with the NYBCL shall protect the directors
of the Company from personal liability to the claimants of the Company.
IN WITNESS WHEREOF, New York Farm Bureau Service Company, Inc. has caused this
Plan to be signed this ____ day of _______, 1998.
NEW YORK FARM BUREAU SERVICE
COMPANY, INC.
By: _______________________
Name: _______________________
Title: _______________________
10
<PAGE>
Exhibit 4
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of April 6,
1999, by and among FARM FAMILY HOLDINGS, INC., a Delaware corporation (the
"Company"), and THE SHAREHOLDERS OF THE COMPANY set forth on the signature pages
hereof (each, a "Shareholder" and collectively, the "Shareholders").
WHEREAS, each of the Shareholders is the owner of the number of shares
of common stock, par value $.01 per share, of the Company (the "Common Stock")
set forth opposite the name of such Shareholder on Exhibit A hereto
(collectively, the "Shares"); and
WHEREAS, pursuant to the Amended and Restated Option Purchase
Agreement, dated as of February 26, 1998, as amended by Amendment No. 1, dated
as of April 28, 1998, and Amendment No. 2, dated as of January 14, 1999 (as so
amended, the "Option Purchase Agreement"), by and among the Company and each of
the Shareholders, the Company agreed to grant to the Shareholders certain
registration rights with respect to the Shares upon the terms and subject to the
conditions set forth herein.
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
Section 1. Demand Registration.
-------------------
1.1 Notice. Upon the terms and subject to the conditions set forth
------
herein, upon written notice by the holders of a majority of the Shares held by
the Shareholders or their Permitted Transferees (as defined in Section 1.3) (the
Shareholders and such Permitted Transferees being collectively referred to
herein as the "Holders") requesting that the Company effect the registration
under the Securities Act of 1933, as amended (the "Securities Act"), of the
Shares held by such Holders, which notice shall specify the intended method or
methods of disposition of such Shares, the Company will promptly give written
notice of the proposed registration to all other Holders and will use its best
efforts to effect (at the earliest possible date) the registration under the
Securities Act of such Shares (and the Shares of any other Holders joining in
such request as are specified in a written notice received by the Company within
20 days after receipt of the Company's written notice of the proposed
registration) for disposition in accordance with the intended method or methods
of disposition stated in such request; provided, however, that:
-------- -------
<PAGE>
(a) if the Company shall have previously effected a registration, the
Company shall not be required to effect a registration pursuant to this Section
1 until 180 days shall have elapsed from the effective date of the most recent
such previous registration;
(b) if, upon receipt of a registration request pursuant to this
Section 1, the Company is advised in writing, with a copy to the Holders of
Shares proposed to be included in the offering (the "Selling Holders"), by a
recognized independent investment banking firm selected by the Company that, in
such firm's opinion, a registration at the time and on the terms requested would
adversely affect any public offering of securities by the Company (other than in
connection with employee benefit and similar plans) (a "Company Offering") that
had been contemplated by the Company prior to the notice by the Holders
requesting registration, the Company shall not be required to effect a
registration pursuant to this Section 1 until the earliest of (i) 180 days after
the completion of such Company Offering, (ii) the termination of any "blackout"
period required by the underwriters, if any, to be applicable to the Holders in
connection with such Company Offering, (iii) promptly after abandonment of such
Company Offering or (iv) 180 days after the date of written notice by the
Holders requesting registration;
(c) if, while a registration request is pending pursuant to this
Section 1, the Company determines in the good faith judgment of the general
counsel of the Company that the filing of a registration statement would require
the disclosure of material information that the Company has a bona fide business
purpose for preserving as confidential or the Company is unable to comply with
the requirements of the Securities and Exchange Commission ("SEC"), the Company
shall not be required to effect a registration pursuant to this Section 1 until
the earlier of (i) the date upon which such material information is disclosed to
the public or ceases to be material or (ii) 120 days after the Company makes
such good faith determination;
(d) subject to Section 2.3(b), Holders shall have the right to
exercise registration rights pursuant to this Section 1 only once; and
(e) the number of Shares registered pursuant to a registration
requested pursuant to this Section 1, (i) shall represent more than 35% of the
Shares and (ii) shall have an aggregate expected offering price of at least $10
million.
1.2 Registration Expenses. All Registration Expenses (as defined in
---------------------
Section 6) for any registration requested pursuant to this Section 1 shall be
paid 50% by the Company and 50% by the Selling Holders, on the basis of the
respective amounts of the securities then being registered on behalf of each of
such Selling Holder; provided that if any securities are registered
--------
-2-
<PAGE>
for sale for the account of any Person (as such term is defined in Section 2(2)
of the Securities Act) other than the Selling Holders pursuant to Section 1,
each such other Person shall bear its pro rata share of the Registration
--- ----
Expenses.
1.3 Permitted Transferees. As used in this Agreement, "Permitted
---------------------
Transferees" shall mean any transferee, whether direct or indirect, of Shares
designated by any Shareholder in a written notice to the Company as provided for
in Section 7.6. Such written notice shall be signed by such Shareholder and the
Permitted Transferee so designated and shall include an undertaking by the
Permitted Transferees to comply with the terms and conditions of this Agreement
applicable to such Shareholder. Permitted Transferees will be entitled to the
benefits of this Agreement.
1.4 Third Person Shares. The Company shall have the right to cause
-------------------
the registration of securities for sale for its own account or for the account
of any Person in any registration of Shares requested pursuant to this Section
1; provided that the Company shall not have the right to cause the registration
--------
of such securities if the managing underwriter of any underwritten offering
shall advise the Company in writing (with a copy to each Selling Holder) that,
in such firm's opinion, registration of such securities would materially and
adversely affect the offering and sale of Shares then contemplated by the
Selling Holders.
1.5 Selection of Underwriters. If a requested registration pursuant
-------------------------
to this Section 1 involves an underwritten offering, there shall be selected one
or more underwriters for such Shares, such underwriters to be selected by the
holders of a majority of the Shares held by the Selling Holders requesting such
registration.
1.6 Priority in Requested Registrations. If a requested registration
-----------------------------------
pursuant to this Section 1 involves an underwritten offering, and the managing
underwriter shall advise the Selling Holders requesting registration of Shares
in writing (with a copy to the Company) that, in its opinion, the inclusion of
all the securities to be included in such registration would interfere with the
sale of the Shares to be sold in such offering by the Selling Holders within a
price range acceptable to the majority (by number of Shares) of the Selling
Holders requesting such registration, the Company will include in such
registration (i) first, Shares requested to be included in such registration by
such Selling Holders, pro rata among such Selling Holders on the basis of the
--- ----
number of Shares which are requested by them and (ii) second, securities of the
Company proposed by the Company to be sold for its own account or for the
account of any Person.
1.7 Effective Registration. Notwithstanding any provision herein to
----------------------
the contrary, a registration requested
-3-
<PAGE>
pursuant to Section 1.1 hereof shall not be deemed to have been effected (and
not requested for purposes of Section 1.1) (i) unless the registration statement
relating thereto has become effective under the Securities Act, (ii) if after it
has become effective such registration is interfered with by any stop order,
injunction or other order or requirement of the SEC or other governmental agency
or court for any reason other than a misrepresentation or omission by a Selling
Holder and, as a result thereof, the Shares requested to be registered cannot be
completely distributed in accordance with the plan of distribution, (iii) if the
conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such registration are not satisfied or
waived other than by reason of some act or omission by a Selling Holder or (iv)
if, pursuant to Section 1.6, less than all of the Shares requested to be
registered were actually registered.
Section 2. Registration Procedures.
-----------------------
2.1 Registration and Qualification. If and whenever the Company is
------------------------------
required to use its best efforts to effect the registration of any Shares under
the Securities Act as provided in Section 1, the Company will as promptly as is
practicable:
(a) prepare, file and use its best efforts to cause to become
effective a registration statement under the Securities Act regarding such
Shares, which registration statement will be on a form consistent with the
intended method of distribution thereof; provided, however, that before filing
-------- -------
with the SEC a registration statement or prospectus, the Company shall furnish
to counsel for the Selling Holders copies of all such documents proposed to be
filed, which documents shall be subject to the reasonable and timely review of
counsel for the Selling Holders. The Company will also notify counsel for the
Selling Holders of any stop order issued or threatened by the SEC and take all
reasonable actions required to prevent the entry of such stop order or to remove
it if entered;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective and to comply
with the provisions of the Securities Act with respect to the disposition of
such Shares until the earlier of (i) such time as such Shares have been disposed
of in accordance with the intended methods of disposition by the Selling Holders
set forth in such registration statement or (ii) such time as such Shares are no
longer required to be registered for the sale thereof by the Holder thereof by
reason of Rule 144(k) of the SEC under the Securities Act or any other rule of
similar effect;
-4-
<PAGE>
(c) furnish to the Selling Holders and to any underwriter of such
Shares such number of conformed copies of such registration statement and of
each such amendment and supplement thereto (in each case including all
exhibits), such number of copies (one of which will be fully executed) of the
prospectus included in such registration statement (including each preliminary
prospectus and any summary prospectus), in conformity with the requirements of
the Securities Act, such documents incorporated by reference in such
registration statement or prospectus, and such other documents as the Selling
Holders or such underwriter may reasonably request;
(d) use its best efforts to register or qualify all Shares covered by
such registration statement under such other securities or blue sky laws of such
United States jurisdictions as the Selling Holders or any underwriter of such
Shares shall reasonably request, and do any and all other acts and things which
may be necessary or advisable to enable the Selling Holders or any underwriter
to consummate the disposition in such jurisdictions of its Shares covered by
such registration statement, except that the Company shall not for any such
purpose be required to qualify generally to do business as a foreign corporation
in any jurisdiction where it is not so qualified, or to subject itself to
taxation in any such jurisdiction, or to consent to general service of process
in any such jurisdiction;
(e) (i) furnish to the Selling Holders, addressed to them, an opinion
of counsel for the Company, dated the date of the closing under the underwriting
agreement, and (ii) use its best efforts to furnish to the Selling Holders,
addressed to them, a "cold comfort" letter signed by the independent public
accountants who have certified the Company's financial statements included in
such registration statement, covering substantially the same matters with
respect to such registration statement (and the prospectus included therein)
and, in the case of such accountants' letter, with respect to events subsequent
to the date of such financial statements, as are customarily covered in opinions
of issuer's counsel and in accountants' letters delivered to underwriters in
underwritten public offerings of securities and such other matters as the
Selling Holders may reasonably request;
(f) immediately notify the Selling Holders at any time when a
prospectus relating to a registration pursuant to Section 1 is required to be
delivered under the Securities Act of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, and at
the request of the Selling Holders prepare and furnish to the Selling Holders a
reasonable number of copies of a supplement to or an amendment of
-5-
<PAGE>
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Shares, such prospectus shall not include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading;
(g) make available senior management personnel to participate in, and
cause them to cooperate with the underwriters in connection with, the "road
show" and other customary marketing activities, including "one-on-one" meetings
with prospective purchasers of the Shares; and
(h) otherwise use commercially reasonable efforts to comply with all
applicable rules and regulations of the SEC, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering a
period of at least 12 months, beginning with the first month after the effective
date of the registration statement (as the term "effective date" is defined in
Rule 158(c) under the Securities Act), which earnings statement shall satisfy
the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.
The Company may require the Selling Holders to furnish the Company
with such information regarding the Selling Holders and the distribution of such
securities as the Company may from time to time reasonably request in writing
and as shall be required by law, the SEC or any securities exchange on which any
shares of Common Stock are then listed for trading in connection with any
registration.
Each Selling Holder agrees that upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 2.1(f),
such Selling Holder will forthwith discontinue its disposition of Shares
pursuant to the registration statement relating to such Shares until such
Selling Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 2.1(f) and, if so directed by the Company, such Selling
Holder will deliver to the Company (at the Company's expense) all copies (other
than permanent file copies then in such Selling Holder's possession) of the
prospectus relating to such Shares current at the time of receipt of such
notice.
2.2 Underwriting. If requested by the underwriters for any
------------
underwritten offering of Shares pursuant to a registration requested hereunder
(including any registration under Section 2 which involves, in whole or in part,
an underwritten offering), the Company will use reasonable efforts to enter into
an underwriting agreement with such underwriters for such offering, such
agreement to be reasonably satisfactory in substance and form to the Company and
to contain such representations and warranties by the Company and such other
-6-
<PAGE>
terms and provisions as are customarily contained in underwriting agreements
with respect to secondary distributions, including, without limitation,
indemnities and contribution to the effect and to the extent provided in Section
4 and the provision of opinions of counsel and accountants' letters to the
effect and to the extent provided in Section 2.1(e). The Selling Holders of
Shares to be distributed by such underwriters shall be parties to any such
underwriting agreement, and the representations and warranties by, and the other
agreements on the part of, the Company to and for the benefit of such
underwriters shall also be made to and for the benefit of such Selling Holders.
2.3 Blackout Periods. (a) At any time when a registration statement
----------------
effected pursuant to Section 1 relating to Shares is effective, upon written
notice from the Company to the Selling Holders that the Company determines in
the good faith judgment of the general counsel of the Company that the Selling
Holders sale of Shares pursuant to the registration statement would require
disclosure of material information which the Company has a bona fide business
purpose for preserving as confidential or the Company is unable to comply with
SEC requirements (an "Information Blackout"), the Selling Holders shall suspend
sales of Shares pursuant to such registration statement until the earlier of (i)
the date upon which such material information is disclosed to the public or
ceases to be material, (ii) 120 days after the Company makes such good faith
determination or (iii) such time as the Company notifies the Selling Holders
that sales pursuant to such registration statement may be resumed (the number of
days from such suspension of sales of the Selling Holders until the day when
such sales may be resumed hereunder is hereinafter called a "Sales Blackout
Period").
(b) Any delivery by the Company of notice of an Information Blackout
during the 120 days immediately following effectiveness of any registration
statement effected pursuant to Section 1 shall give the Selling Holders the
right, by notice to the Company within 20 days after the end of such blackout
period, to cancel such registration and obtain for the Holders one additional
registration right (a "Blackout Termination Right") under Section 1.1(d).
(c) If there is an Information Blackout and the Selling Holders do
not exercise the cancellation right, if any, pursuant to clause (b) of this
Section 2.3, or, if such cancellation right is not available, the period set
forth in Section 2.1(b)(ii) shall be extended for a number of days equal to the
number of days in the Sales Blackout Period.
2.4 Listing. In connection with the registration of any offering of
-------
Shares pursuant to this Agreement, the Company agrees to use its best efforts to
effect the listing of such Shares on any securities exchange on which any shares
of the
-7-
<PAGE>
Common Stock are then listed or otherwise facilitate the public trading
of such Shares.
2.5 Holdback Agreement. To the extent not inconsistent with
------------------
applicable law, each Shareholder agrees not to effect any public sale or
distribution of any equity securities of the Company, or any securities
convertible into or exchangeable or exercisable for such securities, during the
seven days prior to and the 90 days after any registration pursuant to Section 1
has become effective, except as part of such registration, if and to the extent
requested by the Company in the case of a non-underwritten public offering or if
and to the extent requested by the managing underwriter or underwriters in the
case of an underwritten public offering.
Section 3. Preparation; Reasonable Investigation. In connection with
-------------------------------------
the preparation and filing of each registration statement registering Shares
under the Securities Act pursuant to this Agreement, the Company will give the
Selling Holders and the underwriters, if any, and their respective counsel and
accountants, such reasonable and customary access to its books and records and
such opportunities to discuss the business, financial condition and results of
operations of the Company with its officers and the independent public
accountants who have certified its financial statements as shall be necessary,
in the opinion of the Selling Holders and such underwriters or their respective
counsel, to conduct a reasonable investigation within the meaning of the
Securities Act.
Section 4. Indemnification and Contribution.
--------------------------------
4.1 Indemnification and Contribution. (a) In the event of any
--------------------------------
registration of any Shares hereunder, the Company will enter into customary
indemnification arrangements to indemnify and hold harmless each of the Selling
Holders, each of their respective directors and officers, each Person who
participates as an underwriter in the offering or sale of such securities, each
officer and director of each underwriter, and each Person, if any, who controls
each such Selling Holder or any such underwriter within the meaning of the
Securities Act against any losses, claims, damages, liabilities and expenses,
joint or several, to which such Person may be subject under the Securities Act
or otherwise insofar as such losses, claims, damages, liabilities or expenses
(or actions or proceedings in respect thereof) arise out of are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in any registration statement under which such securities were registered under
the Securities Act, any preliminary prospectus or final prospectus included
therein, or any amendment or supplement thereto, or any document incorporated by
reference therein, or (ii) any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the
-8-
<PAGE>
Company will reimburse each such Person, as incurred, for any legal or any other
expenses reasonably incurred by such Person in connection with investigating or
defending any such loss, claim, liability, action or proceeding; provided,
--------
however, that the Company shall not be liable in any such case to the extent
- -------
that any such loss, claim, damage, liability (or action or proceeding in respect
thereof) or expense arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, any such preliminary prospectus or final prospectus,
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by the Selling Holders or such underwriter
specifically for use in the preparation thereof and provided further that the
-------- -------
Company shall not be liable to any Person who participates as an underwriter in
the offering or sale of Shares or any other Person, if any, who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the Person asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written confirmation of the sale
of Shares to such Person if such statement or omission was corrected in such
final prospectus. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Selling Holders or
any such Person and shall survive the transfer of such securities by the Selling
Holders. The Company also shall agree to provide for contribution as shall
reasonably be requested by the Selling Holders or any underwriters in
circumstances where such indemnity is held unenforceable.
(b) The Selling Holders, by virtue of exercising their respective
registration rights hereunder, agree and undertake, jointly and severally, to
enter into customary indemnification arrangements to indemnify and hold harmless
(in the same manner and to the same extent as set forth in clause (a) of this
Section 4), jointly and severally, the Company, each director of the Company,
each officer of the Company who shall sign such registration statement, each
Person who participates as an underwriter in the offering or sale of such
securities, each officer and director of each underwriter, and each Person, if
any, who controls the Company or any such underwriter within the meaning of the
Securities Act, with respect to any statement in or omission from such
registration statement, any preliminary prospectus or final prospectus included
therein, or any amendment or supplement thereto, if, but only to the extent
that, such statement or omission was made in reliance upon and in conformity
with written information furnished by the Selling Holders to the Company
specifically for inclusion in such registration statement or prospectus. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of
-9-
<PAGE>
the Company or any such director, officer or controlling Person and shall
survive the transfer of the registered securities by the Selling Holders. The
Selling Holders also shall agree to provide for contribution as shall reasonably
be requested by the Company for any underwriters in circumstances where such
indemnity is held unenforceable.
(c) Indemnification and contribution similar to that specified in the
preceding subdivisions of this Section 4 (with appropriate modifications) shall
be given by the Company and the Selling Holders with respect to any required
registration or other qualification of such Shares under any federal or state
law or regulation of governmental authority other than the Securities Act.
Section 5. Benefits and Termination of Registration Rights. The
-----------------------------------------------
Shareholders may jointly exercise the registration rights granted hereunder in
such manner and proportions as they shall agree among themselves; provided,
--------
however, any Permitted Transferees of Shares shall be subject to and bound by
- -------
all of the terms and conditions hereof applicable to any Shareholder and, to the
extent that a Permitted Transferee requests to be included in an offering, to
those terms and conditions expressly applicable to Selling Holders. The
registration rights hereunder shall cease to apply to Shares: (a) when a
registration statement with respect to the sale of such Shares shall have become
effective under the Securities Act and such Shares shall have been disposed of
in accordance with the intended methods of disposition by the Selling Holders
set forth in such registration statement; (b) such time as such Shares are no
longer required to be registered for the sale thereof by the Holder thereof by
reason of Rule 144(k) of the SEC under the Securities Act or any other rule of
similar effect; (c) when they shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent public distribution of them
shall not require registration or qualification of them under the Securities Act
or any similar state law then in force; (d) when they shall have ceased to be
outstanding; or (e) in all events, on the second anniversary of the date of this
Agreement.
Section 6. Registration Expenses. As used in this Agreement, the
---------------------
term "Registration Expenses" means all expenses incident to the Company's
performance of or compliance with the registration requirements set forth in
this Agreement including, without limitation, the following: (a) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of Shares to be disposed of under the
Securities Act; (b) all expenses in connection with the preparation, printing
and filing of the registration statement, any preliminary prospectus or final
prospectus, any other offering document and amendments and supplements thereto
and the mailing and delivering of copies thereof to the underwriters and
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<PAGE>
dealers; (c) the cost of printing and producing any agreement(s) among
underwriters, underwriting agreement(s), and blue sky or legal investment
memoranda, any selling agreements and any amendments thereto or other documents
in connection with the offering, sale or delivery of Shares to be disposed of;
(d) all expenses in connection with the qualification of Shares to be disposed
of for offering and sale under state securities laws, including the fees and
disbursements of counsel for the underwriters in connection with such
qualification and in connection with any blue sky and legal investment surveys;
(e) the filing fees incident to securing any required review by the securities
exchange on which any shares of the Common Stock are then listed of the terms of
the sale of Shares to be disposed of; (f) the costs of preparing stock
certificates; and (g)the costs and charges of the Company's transfer agent and
registrar. Registration Expenses shall not include underwriting discounts and
underwriters commissions attributable to the Shares being registered for sale on
behalf of the Selling Holders, which shall be paid by the Selling Holders.
Section 7. Miscellaneous.
-------------
7.1 No Inconsistent Agreements. The Company shall not on or after
--------------------------
the date of this Agreement enter into any agreement with respect to its
securities that violates the rights expressly granted to the Shareholders in
this Agreement.
7.2 Assignment. This Agreement shall be binding upon and inure to
----------
the benefit of and be enforceable by the parties hereto and with respect to the
Company, its respective successors and assigns, and with respect to any
Shareholder, any Permitted Transferees of the Shares.
7.3 Governing Law; Jurisdiction. This Agreement shall be construed,
---------------------------
performed and enforced in accordance with, and governed by, the laws of the
State of New York applicable to contracts executed in and to be performed in
that State.
7.4 Severability. In the event that any part of this Agreement is
------------
declared by any court or other judicial or administrative body to be null, void
or unenforceable, said provision shall survive to the extent it is not so
declared, and all of the other provisions of this Agreement shall remain in full
force and effect.
7.5 Rule 144. If and for so long as the Company is subject to the
--------
reporting requirements of the Exchange Act, the Company shall take measures and
file such information, documents, and reports as shall be required by the SEC as
a condition to the availability of Rule 144 (or any successor provision) under
the Securities Act.
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<PAGE>
7.6 Notices. All notices and other communications hereunder shall be
-------
in writing and shall be deemed given if (i) delivered personally, or (ii) sent
by reputable overnight courier service, or (iii) telecopied (which is
confirmed), or (iv) five days after being mailed by registered or certified mail
return receipt requested) to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):
(a) If to the Company, to:
Farm Family Holdings, Inc.
P.O. Box 656
Albany, New York 12201-0656
Attention: General Counsel
Telephone: (518) 431-5409
Telecopy: (518) 431-5999
(b) If to the Shareholders, to:
The addresses of each Shareholder
listed on Exhibit A hereto.
with a copy to:
Dewey Ballantine
1301 Avenue of the Americas
New York, New York 10019
Attention: Jeff Liebmann
7.7 Amendments; Waivers. This Agreement may be amended or modified,
-------------------
and any of the terms, covenants or conditions hereof may be waived, only by a
written instrument executed by the parties hereto, or in the case of a waiver,
by the party waiving compliance. Any waiver by any party of any condition, or
of the breach of any provision, term or covenant contained in this Agreement, in
any one or more instances, shall not be deemed to be nor construed as furthering
or continuing waiver of any such condition or of the breach of any other
provision, term or covenant of this Agreement.
7.8 Section and Paragraph Headings. The section and paragraph
------------------------------
headings in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
7.9 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original, but all of which shall constitute the
same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
date first above written.
FARM FAMILY HOLDINGS, INC.
By___________________________
Name:
Title:
CONNECTICUT FARM BUREAU
SERVICE COMPANY
By___________________________
Name:
Title:
DELAWARE FARM BUREAU SERVICE
COMPANY, INC.
By___________________________
Name:
Title:
MAINE FARM BUREAU SERVICE
COMPANY
By___________________________
Name:
Title:
MASSACHUSETTS FARM BUREAU
SERVICE COMPANY, INC.
By___________________________
Name:
Title:
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<PAGE>
NEW HAMPSHIRE FARM BUREAU
FEDERATION
By___________________________
Name:
Title:
NEW JERSEY FARM BUREAU SERVICE
COMPANY
By___________________________
Name:
Title:
NEW YORK FARM BUREAU SERVICE
COMPANY, INC.
By___________________________
Name:
Title:
RHODE ISLAND FARM BUREAU
FEDERATION, INC.
By___________________________
Name:
Title:
VERMONT FARM BUREAU, INC.
By___________________________
Name:
Title:
WEST VIRGINIA FARM BUREAU, INC.
By___________________________
Name:
Title:
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<PAGE>
EXHIBIT A
FARM FAMILY HOLDINGS, INC.
--------------------------
SHAREHOLDERS
------------
Registered Holder Number of Shares
- ----------------- ----------------
The Connecticut Farm Bureau Service Company 69,449
510 Pigeon Hill Road
Windsor, Connecticut 06095-2112
Delaware Farm Bureau Service Company 38,585
233 S. Dupont Highway
Camden-Wyoming, Delaware 19934
Maine Farm Bureau Service Co. 15,449
RR 4, Box 1254
4 Gabriel Drive
Augusta, Maine 04330-9322
Massachusetts Farm Bureau Service Company Inc. 100,322
466 Chestnut Street
Ashland, Massachusetts 01721-2299
New Hampshire Farm Bureau Federation 26
295 Sheep Davis Road
Concord, New Hampshire 03301
New Jersey Farm Bureau Service Company 231,527
168 W. State Street
Trenton, New Jersey 08608
New York Farm Bureau Service Company, Inc. 339,578
Route 9W, Box 992
Glenmont, New York 12077-0992
Rhode Island Farm Bureau Federation, Incorporated 30,882
201 Comstock Parkway
Cranston, Rhode Island 02921-2007
Vermont Farm Bureau, Inc. 171
RR 2, Box 123
Richmond, Vermont 05477-9605
West Virginia Farm Bureau, Inc. 30,882
1 Red Rock Road -------
Buckhannon, West Virginia 26201
Total 856,871
=======
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