-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NiC4Ps3D0wv1vu+S+P0cXx2g+o0SDv7Te7ggk8xrcvtjN8wCm7mLXlCD/3GEzDAt 2zpM1m3Z4HGG+3iKeyGfRw== 0000088121-99-000006.txt : 19990510 0000088121-99-000006.hdr.sgml : 19990510 ACCESSION NUMBER: 0000088121-99-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990507 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEABOARD CORP /DE/ CENTRAL INDEX KEY: 0000088121 STANDARD INDUSTRIAL CLASSIFICATION: POULTRY SLAUGHTERING AND PROCESSING [2015] IRS NUMBER: 042260388 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-03390 FILM NUMBER: 99614254 BUSINESS ADDRESS: STREET 1: 9000 W. 67TH STREET CITY: SHAWNEE MISSION STATE: KS ZIP: 66201 BUSINESS PHONE: 9136768800 MAIL ADDRESS: STREET 1: 9000 W. 67TH STREET CITY: SHAWNEE MISSION STATE: KS ZIP: 66202 FORMER COMPANY: FORMER CONFORMED NAME: SEABOARD ALLIED MILLING CORP DATE OF NAME CHANGE: 19820328 FORMER COMPANY: FORMER CONFORMED NAME: HATHAWAY BAKERIES INC DATE OF NAME CHANGE: 19710315 10-Q 1 1999 1ST QUARTER 10-Q FILING UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to _______ _____________ Commission File Number 1-3390 Seaboard Corporation (Exact name of registrant as specified in its charter) Delaware 04-2260388 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 9000 W. 67th Street, Shawnee Mission, Kansas 66202 (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (913) 676-8800 Not Applicable (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No ___. There were 1,487,520 shares of common stock, $.01 par value per share, outstanding on April 30, 1999. Total pages in filing - 16 pages PART I - FINANCIAL INFORMATION Item 1. Financial Statements SEABOARD CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets March 31, 1999 and December 31, 1998 (Thousands of dollars) (Unaudited) March 31, December 31, 1999 1998 Assets Current assets: Cash and cash equivalents $ 16,708 $ 20,716 Short-term investments 129,917 155,763 Receivables, net 177,415 181,583 Inventories 240,826 214,846 Deferred income taxes 14,692 14,604 Prepaid expenses and deposits 21,521 13,757 Total current assets 601,079 601,269 Investments in and advances to foreign affiliates 28,407 28,416 Net property, plant and equipment 558,197 559,749 Other assets 35,396 33,700 Total assets $1,223,079 $1,223,134 Liabilities and Stockholders' Equity Current liabilities: Notes payable to banks $ 162,612 $ 158,980 Current maturities of long-term debt 18,511 18,608 Accounts payable 55,060 73,481 Other current liabilities 130,747 114,395 Total current liabilities 366,930 365,464 Long-term debt, less current maturities 329,452 329,469 Deferred income taxes 45,681 44,147 Other liabilities 29,246 28,580 Total non-current and deferred liabilities 404,379 402,196 Minority interest 1,351 5,682 Stockholders' equity: Common stock of $1 par value, Authorized 4,000,000 shares; issued 1,789,599 shares 1,790 1,790 Less 302,079 shares held in treasury (302) (302) 1,488 1,488 Additional capital 13,214 13,214 Accumulated other comprehensive income (115) (81) Retained earnings 435,832 435,171 Total stockholders' equity 450,419 449,792 Total liabilities and stockholders' equity $1,223,079 $1,223,134 See notes to condensed consolidated financial statements. SEABOARD CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Earnings Three months ended March 31, 1999 and 1998 (Thousands of dollars except per share amounts) (Unaudited) March 31, March 31, 1999 1998 Net sales $ 367,607 $ 446,532 Cost of sales and operating expenses 327,311 398,056 Gross income 40,296 48,476 Selling, general and administrative expenses 30,000 36,215 Operating income 10,296 12,261 Other income (expense): Interest income 1,852 1,616 Interest expense (9,591) (7,812) Income (loss) from foreign affiliates 85 (2,576) Minority interest 474 - Miscellaneous 611 620 Total other income (expense), net (6,569) (8,152) Earnings before income taxes 3,727 4,109 Income tax expense 2,694 1,245 Net earnings $ 1,033 $ 2,864 Earnings per common share $ .69 $ 1.93 Dividends declared per common share $ .25 $ .25 Average number of shares outstanding 1,487,520 1,487,520 See notes to condensed consolidated financial statements. SEABOARD CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows Three months ended March 31, 1999 and 1998 (Thousands of dollars) (Unaudited) March 31, March 31, 1999 1998 Cash flows from operating activities: Net earnings $ 1,033 $ 2,864 Adjustments to reconcile net earnings to cash from operating activities: Depreciation and amortization 14,574 15,334 (Income) loss from foreign affiliates (85) 2,576 Gain from sale of fixed assets (608) (484) Deferred income taxes 1,469 (949) Changes in current assets and liabilities: Receivables, net of allowance 4,168 (9,947) Inventories (25,980) 21,005 Prepaid expenses and deposits (7,764) (4,011) Current liabilities exclusive of debt (2,069) (15,751) Other, net (2,222) (925) Net cash from operating activities (17,484) 9,712 Cash flows from investing activities: Purchase of investments (99,497) (66,758) Proceeds from the sale or maturity of investments 125,286 66,118 Capital expenditures (14,887) (12,644) Proceeds from sale of fixed assets 1,508 4,332 Notes receivable 28 394 Additional investment in a controlled subsidiary (2,202) - Investments in and advances to foreign affiliates 94 (8,997) Investment in domestic affiliate - (2,500) Net cash from investing activities 10,330 (20,055) Cash flows from financing activities: Notes payable to bank, net 3,632 11,176 Principal payments of long-term debt (114) (262) Dividends paid (372) (372) Net cash from financing activities 3,146 10,542 Net change in cash and cash equivalents (4,008) 199 Cash and cash equivalents at beginning of year 20,716 8,552 Cash and cash equivalents at end of quarter $ 16,708 $ 8,751 See notes to condensed consolidated financial statements. SEABOARD CORPORATION AND SUBSIDIARIES Notes to Condensed Consolidated Financial Statements Note 1 - Accounting Policies and Basis of Presentation The consolidated financial statements include the accounts of Seaboard Corporation and its domestic and foreign subsidiaries (the "Company"). All significant intercompany balances and transactions have been eliminated in consolidation. The Company's investments in non- controlled affiliates are accounted for by the equity method. The unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements of the Company for the year ended December 31, 1998 as filed in its Annual Report on Form 10-K. The accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring accruals) which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and cash flows. Results of operations for interim periods are not necessarily indicative of results to be expected for a full year. For the three months ended March 31, 1999 and 1998, other comprehensive income adjustments consisted of an immaterial unrealized gain on available-for-sale securities and foreign currency cumulative translation adjustment, net of tax. Note 2 - Inventories The following is a summary of inventories at March 31, 1999 and December 31, 1998 (in thousands): March 31, December 31, 1999 1998 At lower of last-in, first-out (LIFO) cost or market: Live poultry $ 24,569 $ 24,840 Dressed poultry 24,574 22,961 Feed ingredients, packaging supplies and other 5,106 5,813 54,249 53,614 LIFO allowance 4,662 2,811 Total inventories at lower of LIFO cost or market 58,911 56,425 At lower of first-in, first-out (FIFO) cost or market: Live hogs 74,749 75,887 Grain, flour and feed 31,471 8,196 Sugar produced and in process 24,576 26,025 Crops in production and related materials 10,300 11,233 Dressed pork 6,340 8,486 Other 34,479 28,594 Total inventories at lower of FIFO cost or market 181,915 158,421 Total inventories $240,826 $214,846 Significant decreases in commodity prices during 1999 and 1998 have eliminated the LIFO reserve as overall poultry feed costs have decreased below base year levels. This change in LIFO reserve is reflected in earnings as a reduction in cost of sales. Note 3 - Contingencies The Company is a defendant in a pending arbitration proceeding and related litigation in Puerto Rico brought by the owner of a chartered barge and tug which were damaged by fire after delivery of the cargo. Damages of $47.6 million are alleged. The Company is vigorously defending the action and believes that it has no responsibility for the loss. The Company also believes that it would have a claim for indemnity if it were held liable for any loss. The Company is subject to various other legal proceedings related to the normal conduct of its business. In the opinion of management, none of these actions is expected to result in a judgment having a materially adverse effect on the consolidated financial statements of the Company. Note 4 - Segment Information The following tables set forth specific financial information about each segment as reviewed by the Company's management. Operating income for segment reporting is prepared on the same basis as that used for consolidated operating income. Operating income is used as the measure of evaluating segment performance because management does not consider interest and income tax expense on a segment basis. The Company accounted for its investment in Tabacal using the equity method through December 1998. Effective December 31, 1998, the Company obtained voting control over a majority of the capital stock of Tabacal. Accordingly, during 1999 the operating results of Tabacal are accounted for as a consolidated subsidiary. Due to the significance of Tabacal's operating results, it is reported as an additional segment (Sugar and Citrus) in 1999. The December 31, 1998, total assets by segment information has been restated to reflect Tabacal as a separate segment. No comparative 1998 segment operating result information is provided as Tabacal's results were reported under the equity method in 1998. Sales to External Customers Three Months Ended March 31, (Thousands of dollars) 1999 1998 Poultry $ 110,671 $ 125,188 Pork 120,163 121,736 Marine 70,221 77,043 Commodity Trading and Milling 41,699 82,625 Sugar and Citrus 5,132 - All Other 19,721 39,940 Segment/Consolidated Totals $ 367,607 $ 446,532 Operating Income Three Months Ended March 31, (Thousands of dollars) 1999 1998 Poultry $ 6,489 $ 607 Pork 4,791 (2,373) Marine 2,355 6,924 Commodity Trading and Milling 1,338 2,825 Sugar and Citrus (3,878) - All Other 236 4,365 Segment Totals 11,331 12,348 Reconciliation to consolidated totals- Corporate Items (1,035) (87) Consolidated Totals $ 10,296 $ 12,261 Total Assets March 31, December 31, (Thousands of dollars) 1999 1998 Poultry $ 188,363 $ 188,558 Pork 386,171 387,699 Marine 86,833 99,609 Commodity Trading and Milling 135,834 108,822 Sugar and Citrus 164,128 162,094 All Other 99,208 107,029 Segment Totals 1,060,537 1,053,811 Reconciliation to consolidated totals- Corporate items 162,542 169,323 Consolidated Totals $1,223,079 $1,223,134 Administrative services provided by the corporate office are primarily allocated to the individual segments based on revenues. Corporate assets include short-term investments, certain investments in and advances to foreign affiliates, fixed assets, deferred tax amounts and other miscellaneous items. Corporate operating losses represent certain operating costs not specifically allocated to individual segments. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations LIQUIDITY AND CAPITAL RESOURCES March 31, December 31, 1999 1998 Current ratio 1.64:1 1.65:1 Working capital $234.1 $235.8 Cash from operating activities for the three months ended March 31, 1999, decreased $27.2 million compared to the same period one year earlier. The decrease in cash flows was primarily related to changes in certain components of working capital and, to a lesser extent, the timing of normal receipts and payments. Within the Commodity Trading and Milling segment there were several more voyages in transit at March 31, 1999 than at December 31, 1998, resulting in an increase in inventory balances and a partially offsetting increase in deferred revenue balances. During the first quarter of 1998 the sell-off of a build-up of poultry leg-quarter inventory and a decrease in voyages in transit resulted in a decrease in inventories during that period. The Company invested $14.9 million in property, plant and equipment for the three months ended March 31, 1999, of which $3.3 million was expended in the Poultry segment, $3.1 million in the Pork segment, $4.2 million in the Marine segment, $2.0 million in the Sugar and Citrus segment, and $2.3 million in other businesses of the Company. The Company invested $3.3 million primarily for the expansion projects at the Mayfield, Kentucky and Chattanooga, Tennessee, poultry facilities. The Company anticipates spending $53.5 million over the next nine months for these expansions and to make general upgrades to other poultry facilities. Management anticipates these expenditures will be financed by internally generated cash. The Company invested $3.1 million primarily for improvements to the pork processing plant. The Company plans to invest $10.7 million over the next nine months for general upgrades to the pork processing plant and continued expansion of hog production facilities. Capital expenditures in the Marine segment totaled $4.2 million to purchase a vessel previously chartered and for general replacement and upgrades of property and equipment. Over the next nine months, the Company anticipates spending $9.3 million for the purchase of an additional vessel currently chartered and for general replacement and upgrades of property and equipment. The Company invested $2.0 million in the Sugar and Citrus segment primarily for improvements to existing operations and expansion of sugarcane fields. Over the next nine months, the Company anticipates spending $13.0 million for additional improvement and expansion. Capital expenditures in the other segments for the three months ended March 31, 1999 included $2.3 million in general modernization and efficiency upgrades of plant and equipment. During the first quarter of 1999, the Company invested $2.2 million to acquire additional shares of a Bulgarian winery. The Company originally purchased a controlling interest in the winery in October 1998. In the first quarter of 1999, the Company's one-year revolving credit facilities totaling $145.0 million, maturing during the first quarter of 1999 were increased to $153.3 million and extended for an additional year. In addition, the existing five-year revolving credit facility totaling $25.0 million was increased to $26.7 million. As of March 31, 1999, the Company had $141.0 million outstanding under one- year revolving credit facilities totaling $153.3 million and $21.6 million outstanding under short-term uncommitted credit lines totaling $126.0 million. Management intends to continue seeking opportunities for expansion in the industries in which it operates and believes that the Company's liquidity, capital resources and borrowing capabilities are adequate for its current and intended operations. RESULTS OF OPERATIONS Net sales for the three months ended March 31, 1999 decreased by $78.9 million compared to the three months ended March 31, 1998. Operating income decreased by $2.0 million compared to the same quarter one year ago. As of December 31, 1998, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 131, "Disclosures about Segments of an Enterprise and Related Information." Accordingly, certain 1998 quarterly segment information below has been reclassified to conform with the new presentations. Poultry Segment Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 110.7 125.2 Operating income $ 6.5 0.6 Net sales of poultry products during the first quarter of 1999 decreased $14.5 million compared to the first quarter of 1998. This decrease is primarily a result of decreased leg-quarter sales volume and price, partially offset by an increase in the sales volume and prices of further processed products. Decreased leg-quarter sales in 1999 are primarily attributable to the continued Russian economic crisis and the sell off of a build-up of leg-quarter inventories in the first quarter of 1998. As Russia is a large importer of leg quarters, the decrease in volume exported to Russia is increasing domestic supply, thereby lowering domestic leg-quarter prices. Sales volume and, to a lesser extent, prices of further processed products increased in the first quarter of 1999 compared to the first quarter of 1998. The Company continues to emphasize further processed products, generally involving the processing of smaller birds but resulting in higher per pound prices. Although management is unable to predict future poultry prices, it is anticipated that prices will generally remain favorable during 1999, with the exception of leg quarters. Operating income for the Poultry segment increased $5.9 million in the first quarter of 1999 compared to the first quarter of 1998, primarily as a result of lower finished feed costs, partially offset by lower leg-quarter sales prices. Although management cannot predict finished feed costs, it is anticipated that feed ingredient costs should continue to be favorable for most of 1999. Pork Segment Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 120.2 121.7 Operating income $ 4.8 (2.4) Net sales for the Pork segment decreased $1.5 million in the first quarter of 1999 compared to the first quarter of 1998. Lower pork prices were largely offset by an increase in sales volume. Lower sales prices for most pork products have resulted from an industry wide excess supply of live hogs and, to a lesser extent, pricing pressure from the Asian economic situation. The increase in sales volume is the result of the hog processing plant operating at full capacity on a double-shift basis during the first quarter of 1999. The plant employed a second shift during the first quarter of 1998, but did not achieve full double-shift capacity until the third quarter of 1998. Although management cannot predict pork prices, it is anticipated that market conditions will be more favorable to the Company during the remainder of 1999 compared to 1998. Operating income for the Pork segment increased $7.2 million in the first quarter of 1999 compared to the first quarter of 1998 primarily as a result of a decrease in the cost of third party hogs processed and, to a lesser extent, a decrease in the cost of Company raised hogs. The decrease in the cost of Company raised hogs is primarily the result of lower grain prices. Although management cannot predict grain prices, it is anticipated that grain prices should continue to be favorable for most of 1999. Marine Segment Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 70.2 77.0 Operating income $ 2.4 6.9 Net sales for the Marine segment decreased $6.8 million in the first quarter of 1999 compared to the first quarter of 1998. Cargo volumes and applicable cargo rates decreased in 1999 compared to 1998 primarily as a result of weakening economic conditions in certain South American markets the Company serves and, to a lesser extent, from lingering trade disruptions of northbound fruit cargo relating to Hurricane Mitch in Central America. Operating income from the Marine segment decreased $4.5 million in the first quarter of 1999 compared to the first quarter of 1998, primarily as a result of lower cargo volumes and rates discussed above. Management expects that these situations will continue to have a negative effect on financial results through at least the first half of 1999. A new U.S. shipping law, The Ocean Reform Act of 1998, will go into effect in May 1999 and will permit shipping companies to enter into unregulated confidential rate agreements with shippers. Management is not able to predict the impact of this new law on 1999 financial results. Commodity Trading and Milling Segment Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 41.7 82.6 Operating income $ 1.3 2.8 Net sales for the Commodity Trading and Milling segment decreased $40.9 million in the first quarter of 1999 compared to the first quarter of 1998. The decrease is primarily a result of lower soybean sales, lower wheat sales to certain foreign affiliates and, to a lesser extent, a decrease in commodity prices sold in foreign markets. Operating income for this segment decreased $1.5 million in the first quarter of 1999 compared to the first quarter of 1998, primarily due to the decrease in wheat sales to certain foreign affiliates. Sugar and Citrus Segment Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 5.1 - Operating income $ (3.9) - As discussed in Note 4 to the Condensed Consolidated Financial Statements, comparative operating results for the Sugar and Citrus segment are not presented as Tabacal was accounted for on the equity method in 1998. However, lower sugar prices have resulted in significantly lower revenues and higher losses in the first quarter 1999 compared to 1998. In the first quarter of 1998, the loss from foreign affiliates attributable to Tabacal was $2.0 million. To reduce future operating costs, management plans certain employee layoffs during the second quarter expected to result in related severance charges of approximately $3 to $4 million. Failure of sugar prices to return to historical levels could lower future expected cash flows to the extent that the carrying amount of Tabacal's long-lived asset values might be impaired. Any such impairment may require a write down of the related asset values with a corresponding charge to earnings sometime during 1999 or 2000. Although management cannot predict future sugar prices, it is anticipated that market conditions will continue to have a negative effect on Tabacal resulting in additional losses for the remainder of 1999. Other Operations Three Months Ended March 31, (Dollars in millions) 1999 1998 Net sales $ 19.7 39.9 Operating income $ 0.2 4.4 Net sales for all other segments decreased $20.2 million in the first quarter of 1999 compared to the first quarter of 1998. The decrease is primarily a result of the sale of the Puerto Rican baking operations in December 1998, partially offset by the revenues of the Bulgarian winery acquired late in 1998. Operating income for all other segments decreased $4.2 million in the first quarter of 1999 compared to the first quarter of 1998. This decrease primarily reflects the Puerto Rican baking operations sold in December 1998, lower operating income from the produce division and small losses from the Bulgarian winery acquired late in 1998. Selling, General and Administrative Expenses Selling, general and administrative (SG&A) expenses decreased $6.2 million to $30.0 million for the first quarter of 1999 compared to the first quarter of 1998. The decrease is primarily a result of the Puerto Rican baking operations sold in December 1998, partially offset by the winery acquired late in 1998 and consolidation of Tabacal results in 1999. As a percentage of revenues, SG&A increased slightly to 8.2% in the first quarter of 1999 from 8.1% in the first quarter of 1998. Interest Expense Interest expense increased $1.8 million in the first quarter of 1999 compared to the first quarter of 1998. The increase is primarily a result of increased long-term borrowings and higher overall borrowing rates. Increased long-term borrowings are primarily the result of the consolidation, effective December 1998, of the existing debts of Tabacal and the Bulgarian winery. Income (loss) from Foreign Affiliates Losses from foreign affiliates for the first quarter of 1998 were primarily attributable to the operations of Tabacal. As discussed in Note 4 to the Condensed Consolidated Financial Statements, Tabacal is included in 1999 consolidated operations. Minority Interest Minority interest represents the minority shareholders' share of the operating results of the Bulgarian winery acquired in the fourth quarter of 1998. Income Tax Expense The effective tax rate increased to 72% in the first quarter of 1999 from 30% in the first quarter of 1998. This increase is primarily attributable to an increase in losses from foreign entities for which no tax benefit is available. Other Financial Information In 1998, the Company expanded the scope of its original Year 2000 assessment and has completed the assessment of its primary mainframe computer systems, both hardware and software. Resolution of issues identified within the primary mainframe computer systems, including all necessary testing, is expected to be completed by mid-1999. The Company is in the advanced stages of assessing other computer and electronic information systems throughout its operations, with the objective of addressing any issues deemed critical to operations by mid-1999. Certain equipment with embedded chip technology cannot be tested or guaranteed by the manufacturer for Year 2000 compliance. Consequently, general contingency plans are being developed for certain locations including lists of spare parts to have on hand and work around options in case of failure. Although not deemed critical to consolidated operations, computer systems at certain international locations are being reviewed and upgrades are planned or in process. The failure to identify or resolve any significant Year 2000 issue in a timely manner could have a material adverse effect on the Company, including an interruption in, or a failure of, certain normal business activities or operations. The Company is also in the process of communicating with significant suppliers and customers to determine the extent to which the Company is vulnerable to failure of those third parties to resolve their own Year 2000 issues. The Company does not anticipate the cost of Year 2000 compliance by suppliers to be passed on to the Company and has not been informed of any material risks related to third party Year 2000 compliance. The Company is developing general contingency plans for some instances of third party noncompliance including limited backup utility sources to support live inventories for a short period of time. However, the failure of a significant third party supplier or customer to resolve its Year 2000 issues in a timely manner could have a material adverse effect on the Company, such as business disruptions resulting from noncompliance by a local utility (either electric, gas or water) or chartered vessel service. Based upon assessments completed to date, the Company believes that the total costs, including equipment replacements and internal costs consisting primarily of payroll related costs, to resolve Year 2000 issues will not be material to the Company's consolidated financial statements. Not all assessments are complete at this date and the discovery of a significant Year 2000 issue unknown at this time could materially alter this estimate. Derivative Information The Company is exposed to various types of market risks from its day- to-day operations. Primary market risk exposures result from changing interest rates and commodity prices. Changes in interest rates impact the cash required to service variable rate debt. Changes in commodity prices impact the cost of necessary raw materials as well as the selling prices of finished products. The Company uses interest rate swaps to manage risks of increasing interest rates. The Company uses corn, wheat, soybeans and soybean meal futures and options to manage risks of increasing prices of raw materials. The Company uses hog futures and options to manage risks of fluctuating prices of third party hogs acquired for processing. The Company is also subject to foreign currency exchange rate risk on a short-term note payable denominated in foreign currency. This risk is managed through the use of a foreign currency forward exchange agreement. The Company's market risk exposure related to these items has not changed substantially since December 31, 1998. SEABOARD CORPORATION AND SUBSIDIARIES PART II - OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders The annual meeting of stockholders was held on April 26, 1999 in Newton, Massachusetts. Two items were submitted to a vote of stockholders as described in the Company's Proxy Statement dated March 25, 1999. The table below briefly describes the proposals and results of the stockholders' vote. Votes in Votes Favor Against Abstain 1. To elect: H. Harry Bresky, 1,443,476.75 0 1,530 Joe E. Rodrigues 1,443,096.75 0 1,910 David A. Adamsen 1,443,096.75 0 1,910 and Thomas J. Shields 1,443,476.75 0 1,530 as directors. 2. To ratify selection of KPMG LLP as independent auditors. 1,443,503.75 20 1,483 A shareholder proposal to recommend a stock split which had been included in the Company's proxy statement was not presented to the meeting as the proponent did not attend the meeting either in person or by duly qualified representative. SEABOARD CORPORATION AND SUBSIDIARIES PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 2.1 - Registrant's By-laws, as amended. 10.1 - Registrant's Executive Deferred Compensation Plan dated January 1, 1999 (b) Reports on Form 8-K. Seaboard Corporation has not filed any reports on Form 8-K during the quarter ended March 31, 1999. This Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which include statements concerning projection of revenues, income or loss, capital expenditures, capital structure or other financial items, statements regarding the plans and objectives of management for future operations, statements of future economic performance, statements of the assumptions underlying or relating to any of the foregoing statements and other statements which are other than statements of historical fact. These statements appear in a number of places in this Form 10-Q and include statements regarding the intent, belief or current expectations of the Company and its management with respect to (i) the cost and timing of the completion of new or expanded facilities, (ii) the Company's financing plans, (iii) the price of feed stocks and other materials used by the Company, (iv) the price for the Company's products and services, (v) the effect of Tabacal on the consolidated financial statements of the Company, (vi) the impact of Year 2000 issues, or (vii) other trends affecting the Company's financial condition or results of operations. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially as a result of various factors. The accompanying information contained in this Form 10-Q under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" identifies important factors which could cause such differences. PART II - OTHER INFORMATION SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DATE: May 7, 1999 Seaboard Corporation by: /s/ Robert L. Steer Robert L. Steer, Vice President-Chief Financial Officer (Authorized officer and principal financial and accounting officer) EX-2.1 2 REGISTRANT'S BY-LAWS SEABOARD CORPORATION BY-LAWS OFFICES 1. The principal office shall be in the City of Wilmington, County of New Castle, State of Delaware, and the name of the resident agent in charge thereof is The Corporation Trust Company. 2. The corporation may also have an office in Chestnut Hill, Massachusetts, and also offices at such other places as the board of directors may from time to time determine or the business of the corporation may require. STOCKHOLDERS' MEETINGS 3. All meetings of the stockholders for the election of directors shall be held in the City of Boston, Commonwealth of Massachusetts, at such place as may be fixed from time to time by the board of directors, or at such other place either within or without the State of Delaware as shall be designated from time to time by the board of directors and stated in the notice of the meeting. Meetings of stockholders for any other purpose may be held at such time and place, within or without the State of Delaware, as shall be stated in the notice of the meeting or a duly executed waiver of notice thereof. 4. An annual meeting of stockholders, commencing with the year 1989, shall be held on the fourth Monday of April in each year, if not a legal holiday, and if a legal holiday then on the next secular day following, at 10 o'clock A.M., at which they shall elect, by a plurality vote, a Board of Directors, and transact such other business as may properly be brought before the meeting. 5. Written notice of the annual meeting shall be served upon or mailed to each stockholder entitled to vote thereat at such address as appears on the books of the corporation, at least ten days prior to the meeting. 6. At least ten days before every election of directors, a complete list of the stockholders entitled to vote at said election, arranged in alphabetical order, with the residence of each and the number of voting shares held by each, shall be prepared by the secretary. Such list shall be open at the place where the election is to be held for said ten days, to the examination of any stockholder, and shall be produced and kept at the time and place of election during the whole time thereof, and subject to the inspection of any stockholder who may be present. 7. Special meetings of the stockholders for any purpose or purposes, unless otherwise prescribed by statute or by the certificate of incorporation, may be called by the president and shall be called by the president or secretary at the request in writing of a majority of the board of directors, or at the request in writing of three or more stockholders owning in amount one tenth of the entire capital stock of the corporation issued and outstanding and entitled to vote. Such request shall state the purpose or purposes of the proposed meeting. 8. Written notice of a special meeting of stockholders, stating the time and place and object thereof, shall be served upon or mailed to each stockholder entitled to vote thereat at such address as appears on the books of the corporation, at least ten days before such meeting. 9. Business transacted at all special meetings shall be confined to the objects stated in the call. 10. The holders of a majority in amount of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall be requisite and shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute, by the certificate of incorporation or by these by-laws. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders, entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally notified. 11. When a quorum is present at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of the statutes or of the certificate of incorporation or of these by-laws, a different vote is required in which case such express provision shall govern and control the decision of such question. 12. At any meeting of the stockholders every stockholder having the right to vote shall be entitled to vote in person, or by proxy appointed by an instrument in writing subscribed by such stockholder and bearing a date not more than six months prior to said meeting, unless said instrument provides for a longer period. Each stockholder shall have one vote for each share of stock having voting power, registered in his name on the books of the corporation, and except where the transfer books of the corporation shall have been closed or a date shall have been fixed as a record date for the determination of its stockholders entitled to vote, no share of stock shall be voted on at any election of directors which shall have been transferred on the books of the corporation within twenty days next preceding such election of directors. 13. Whenever the vote of stockholders at a meeting thereof is required or permitted to be taken in connection with any corporate action by any provisions of the statutes or of the certificate of incorporation or of these by-laws, the meeting and vote of stockholders may be dispensed with, if all the stockholders who would have been entitled to vote upon the action if such meeting were held, shall consent in writing to such corporate action being taken. DIRECTORS 14. The number of directors of the corporation constituting the full board of directors shall be no less than three (3) and no more than fifteen (15), the exact number to be determined by the Board of Directors from time to time. Within the foregoing limits, between elections by stockholders the board of directors may change the number of directors constituting the full board of directors. Directors need not be stockholders of the corporation. Each director, including a director elected to fill a vacancy, shall hold office until his successor has been duly elected and qualified unless he sooner shall have resigned or been removed from office. 15. The directors may hold their meetings and keep the books of the corporation, except the original or duplicate stock ledger, outside of Delaware, at the office of the corporation in Chestnut Hill, Massachusetts, or at such other places as they may from time to time determine. 16. A vacancy or newly created directorship, as the case may be, shall be deemed to exist in the Board of Directors in case of the death, resignation, disqualification, or removal of any director, or if the authorized number of directors is increased, or if the stockholders fail at any meeting of stockholders at which directors are to be elected to elect the full authorized number of directors to be elected at that meeting. Vacancies and newly created directorships in the board of directors may be filled by a majority of the remaining directors, though fewer than a quorum, or by a sole remaining director. Upon the resignation of one or more directors from the board of directors to be effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have the power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations become effective. No reduction of the authorized number of directors shall have the effect of removing any director prior to the expiration of his term of office; provided, however, that such director, or the entire board of directors, may be removed from office, with or without cause, by the holders of a majority of shares then entitled to vote at an election of directors. 17. The property and business of the corporation shall be managed by its board of directors which may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the certificate of incorporation or by these by-laws directed or required to be exercised or done by the stockholders. COMMITTEES OF DIRECTORS 18. The board of directors may, by vote of a majority of their entire number, elect from their own number an executive committee of not less than three nor more than five members, which committee may be vested with the management of the current and ordinary business of the corporation, including the declaration of dividends, the fixing and altering of the powers and duties of the several officers and agents of the corporation, the election of additional officers and agents, and the filling of vacancies other than in the board of directors, and with power to authorize purchases, sales, contracts, offers, conveyances, transfers and negotiable instruments. A majority of the executive committee shall constitute a quorum for the transaction of business but a less number may adjourn any meeting from time to time, and the meeting may be held as adjourned without further notice. The executive committee may make rules not inconsistent herewith for the holding and conduct of its meetings. 19. The board of directors may, by resolution or resolutions passed by a majority of the whole board, designate other committees, each committee to consist of three or more of the directors of the corporation, which to the extent provided in said resolution or resolutions, shall have and may exercise the powers of the board of directors in the management of the business and affairs of the corporation, and may have power to authorize the seal of the corporation to be affixed to all papers which may require it. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the board of directors. 20. All committees shall keep their regular minutes of their proceedings and report the same to the board, who shall have power to rescind any vote or resolution passed by any committee but no such rescission shall have retroactive effect. COMPENSATION OF DIRECTORS 21. Directors, as such, shall not receive any stated salary for their services, but, by resolution of the board a fixed sum and expenses of attendance, if any, may be allowed for attendance at each regular or special meeting of the board; provided that nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor. 22. Members of Executive or other committees may be allowed like compensation for attending committee meetings. MEETINGS OF THE BOARD 23. The first meeting of each newly elected board shall be held at such time and place either within or without the State of Delaware as shall be fixed by the vote of the stockholders at the annual meeting and no notice of such meeting shall be necessary to the newly elected directors in order legally to constitute the meeting provided a quorum shall be present, or they may meet at such place and time as shall be fixed by the consent in writing of all the directors. 24. Regular meetings of the board may be held without notice at such time and place either within or without the State of Delaware as shall from time to time be determined by the board. 25. Special meetings of the board may be called by the president on two days' notice to each director, either personally or by mail or by telegram; special meetings shall be called by the president or secretary in like manner and on like notice on the written request of two directors. 26. At all meetings of the board a majority of the entire board shall be necessary and sufficient to constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the board of directors, except as may be otherwise specifically provided by statute or by the certificate of incorporation or by these by-laws. If a quorum shall not be present at any meeting of directors the directors present thereat may adjourn the meeting from time to time without notice other than announcement at the meeting, until a quorum shall be present. 27. No notice of directors' meeting shall be necessary if all directors are present or waive notice of the meeting. NOTICES 28. Whenever under the provisions of the statutes or of the certificate of incorporation or of these by-laws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, by depositing the same in a post office or letter box, in a post-paid sealed wrapper, addressed to such director or stockholder at such address as appears on the books of the corporation, or, in default of other address, to such director or stockholder at the General Post Office in the City of Wilmington, Delaware, and such notice shall be deemed to be given at the time when the same shall be thus mailed. 29. Whenever any notice is required to be given under the provisions of the statutes or of the certificate of incorporation, or of these by-laws, a waiver thereof in writing signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto. OFFICERS 30. The officers of the corporation shall be chosen by the directors and shall be a president, a secretary and a treasurer. Two or more offices may be held by the same person, except that where the offices of president and secretary are held by the same person, such person shall not hold any other office. 31. The board of directors at its first meeting after each annual meeting of stockholders shall choose a president from its members, a secretary and a treasurer, none of whom need be a member of the board. 32. The board of directors or Executive Committee may appoint such other officers and agents as it shall deem necessary, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the board or Executive Committee. 33. The Board of Directors shall have authority (a) to fix the compensation, whether in the form of salary, bonus, stock options or otherwise, of all officers and employees of the Corporation, either specifically or by formula applicable to particular classes of officers or employees, and (b) to authorize officers of the Corporation to fix the compensation of officers of the Corporation who are not "named executive officers" of the Corporation within the meaning of Item 402 of Regulation S-K promulgated under the Securities Act of 1933 and the Securities Exchange Act of 1934. The Board of Directors shall have authority to appoint a Compensation Committee and may delegate to such committee any or all of its authority relating to compensation. The appointment of an officer shall not create any employment or contract rights in that officer. 34. The officers of the corporation shall hold office until their successors are chosen and qualify in their stead. Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the whole board of directors. If the office of any officer becomes vacant for any reason, the vacancy shall be filled by the board of directors. THE PRESIDENT 35. The president shall be the chief executive officer of the corporation; he shall preside at all meetings of the stockholders and directors, shall be ex oficio a member of all standing committees, shall have general and active management of the business of the corporation, and shall see that all orders and resolutions of the board are carried into effect. 36. He shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the board of directors to some other officer or agent of the corporation. VICE-PRESIDENTS 37. Any vice-presidents in the order of their seniority shall, in the absence or disability of the president, perform the duties and exercise the powers of the president, and shall perform such other duties as the board of directors or Executive Committee shall prescribe. THE SECRETARY AND ASSISTANT SECRETARIES 38. The secretary shall attend all sessions of the board and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose and shall perform like duties for the standing committees when required. He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the board of directors, and shall perform such other duties as may be prescribed by the board of directors or president, under whose supervision he shall be. He shall keep in safe custody the seal of the corporation and, when authorized by the board, affix the same to any instrument requiring it and, when so affixed, it shall be attested by his signature or by the signature of the treasurer or an assistant secretary. 39. Any assistant secretaries in order of their seniority shall, in the absence or disability of the secretary, perform the duties and exercise the powers of the secretary and shall perform such other duties as the board of directors or Executive Committee shall prescribe. THE TREASURER AND ASSISTANT TREASURERS 40. The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the board of directors. 41. He shall disburse the funds of the corporation as may be ordered by the board, or Executive Committee, taking proper vouchers for such disbursements, and shall render to the president and directors, at the regular meetings of the board, or whenever they may require it, an account of all his transactions as treasurer and of the financial condition of the corporation. 42. If required by the board of directors, he shall give the corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the board for the faithful performance of the duties of his office and for the restoration to the corporation, in case of his death, resignation, retirement, or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation. 43. Any assistant treasurers in the order of their seniority shall, in the absence or disability of the treasurer, perform the duties and exercise the powers of the treasurer and shall perform such other duties as the board of directors or Executive Committee shall prescribe. CERTIFICATES OF STOCK 44. The certificates of stock of the corporation shall be numbered and shall be entered in the books of the corporation as they are issued. They shall exhibit the holder's name and number of shares and shall be signed by the president and the treasurer. If any stock certificate is signed (1) by a transfer agent or an assistant transfer agent or (2) by a transfer clerk acting on behalf of the corporation and a registrar, the signature of any such officer may be facsimile. TRANSFERS OF STOCK 45. Upon surrender to the corporation or any transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. CLOSING OF TRANSFER BOOKS 46. The board of directors shall have power to close the stock transfer books of the corporation for a period not exceeding fifty days preceding the date of any meeting of stockholders or the date for payment of any dividend or the date for the allotment of rights or the date when any change or conversion or exchange of capital stock shall go into effect or for a period of not exceeding fifty days in connection with obtaining the consent of stockholders for any purpose; provided, however, that in lieu of closing the stock transfer books as aforesaid, the board of directors may fix in advance a date, not exceeding fifty days preceding the date of any meeting of stockholders, or the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, or a date in connection with obtaining such consent, as a record date for the determination of the stockholders entitled to notice of, and to vote at, any such meeting, and any adjournment thereof, or entitled to receive payment of any such dividend, or to any such allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, or to give such consent, and in such case such stockholders and only such stockholders as shall be stockholders of record on the date so fixed shall be entitled to such notice of, and to vote at, such meeting and any adjournment thereof, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights, or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the corporation after any such record date fixed as aforesaid. REGISTERED STOCKHOLDERS 47. The corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware. LOST CERTIFICATE 48. The board of directors or Executive Committee may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost or destroyed, upon making of an affidavit of that fact by the person claiming the certificate of stock to be lost or destroyed. When authorizing such issue of a new certificate or certificates, the board of directors or Executive Committee may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost or destroyed. DIVIDENDS 49. Dividends upon the capital stock of the corporation, subject to the provisions of the certificate of incorporation, if any, may be declared by the board of directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the certificate of incorporation. 50. Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the directors shall think conducive to the interest of the corporation, and the directors may modify or abolish any such reserve in the manner in which it was created. DIRECTORS' ANNUAL STATEMENT 51. The board of directors shall present at each annual meeting and when called for by vote of the stockholders at any special meeting of the stockholders, a full and clear statement of the business and condition of the corporation. CHECKS 52. All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the board of directors or Executive Committee may from time to time designate. FISCAL YEAR 53. The fiscal year shall be the calendar year, beginning with the calendar year ending December 31, 1986. SEAL 54. The corporate seal shall have inscribed thereon the name of the corporation, the year of its organization and the words "Corporate Seal, Delaware". Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. AMENDMENTS 55. These by-laws may be altered or repealed at any regular meeting of the stockholders or at any special meeting of the stockholders at which a quorum is present or represented, provided notice of the proposed alteration or repeal be contained in the notice of such special meeting, by the affirmative vote of a majority of the stock entitled to vote at such meeting and present or represented thereat, or by the affirmative vote of a majority of the board of directors at any regular meeting of the board or at any special meeting of the board if notice of the proposed alteration or repeal be contained in the notice of such special meeting; provided, however, that no change of the time or place of the meeting for the election of directors shall be made within sixty days next before the day on which such meeting is to be held, and that in case of any change of such time or place, notice thereof shall be given to each stockholder in person or by letter mailed to his last known post office address at least twenty days before the meeting is held. INDEMNIFICATION 56. Mandatory Indemnification of Officers and Directors. The Corporation shall indemnify and reimburse each director and officer of the Corporation, and each director and officer of a subsidiary whose election or appointment it has voted for or expressly approved, who is elected, appointed or continued in office after February 22, 1993, for and against all liabilities and expenses imposed upon or reasonably incurred by him in connection with any action, suit or proceeding in which he may be involved or with which he may be threatened by reason of his being or having been a director or officer of the Corporation or of a subsidiary or his acts and omissions as such officer or director of the Corporation or of a subsidiary. The right of indemnity and reimbursement of each such person shall continue whether or not he continues to be such director or officer at the time such liabilities or expense are imposed upon or incurred by him and shall include, without being limited to, attorney's fees, court costs, judgments and compromise settlements. The right of reimbursement for liabilities and expenses so imposed or incurred shall include the right to receive such reimbursement in advance of the final disposition of any such action, suit or proceeding upon the Corporation's receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall be ultimately determined that he is not entitled to be indemnified by the Corporation pursuant to law or this paragraph. In no case shall such indemnification and reimbursement cover (a) liabilities or expenses imposed or incurred in connection with any matter as to which such director or officer shall be finally determined in such action, suit or proceeding to be liable by reason of his having been derelict in the performance of his duty as such director or officer, or (b) amounts paid to the Corporation or to a subsidiary and expenses incurred in connection with the proceeding or claim on account of which such payment is made, unless such reimbursement is provided for in compromise settlement approved in a manner described in clause (c) next following, or (c) liabilities or expenses imposed or incurred in connection with any matter which shall be settled by compromise (including settlement by consent decree or judgment) if under such compromise such director or officer is required to make any payment, unless such compromise shall, after notice that it involves such reimbursement, be approved as in the best interest of the Corporation by vote of the board of directors of the Corporation at a meeting in which no director against whom any action, suit or proceeding on the same or similar grounds is then pending participates, or by vote or written approval of the holders of a majority of the shares of stock of the Corporation then outstanding and entitled to vote, for this purpose not counting as outstanding any shares of stock held or controlled by any such director or officer of the Corporation against whom any action, suit or proceeding on the same or similar grounds is then pending; provided, however, that no indemnification shall be made in respect of any claim, issue or matter as to which such a person shall have been adjudged to be liable for negligence or misconduct in the performance of his or her duty to the Corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery of the State of Delaware or such other court shall deem proper. The rights of indemnification and reimbursement hereby provided shall not be exclusive of other rights to which any director or officer may be entitled. As used in this paragraph the terms "director" and "officer" shall include their respective heirs, executors and administrators. 57. Discretionary Indemnification. (a) Actions By Third Parties. The Corporation shall have the right, but not the obligation, to indemnify, up to and including the full extent set forth in this paragraph, any person who was or is a party, or is threatened to be made a party to, or is otherwise involved in, any pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he or she is or was an employee or agent of the Corporation, or was serving at the request of the Corporation as a director, officer, partner, member, trustee, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise (whether or not for profit) including serving as Trustee of an employee benefit plan of the Corporation or other entity described in this subparagraph, (whether or not such employee benefit plan is governed by ERISA), against all liability, losses, expenses (including attorneys' fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by him or her in connection with such action, suit or proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interest of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit or proceeding against any such person by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that he or she did not act in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interest of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his or her conduct was unlawful. (b) Actions by or on Behalf of the Corporation. The Corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he or she is or was an employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, partner, member, trustee, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise or entity (whether or not for profit) against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection with the defense or settlement of such action or suit if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such a person shall have been adjudged to be liable for negligence or misconduct in the performance of his or her duty to the Corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnify for such expenses which the Court of Chancery of the State of Delaware or such other court shall deem proper. (c) Indemnification for Expenses of Successful Defense. To the extent that (i) in the case of actions, suits or proceedings relating to acts or omissions occurring prior to July 1, 1997, any director, officer, employee or agent of the Corporation, or (ii) in the case of actions, suits or proceedings relating to acts or omissions occurring on or after such date, any present or former director or officer of this Corporation or of a subsidiary has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in paragraphs 56 or 57(b) of these Bylaws, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection with such defense. The Corporation shall have the right, but not the obligation, to indemnify any person described in paragraphs 57(a) or (b) who has been successful on the merits or otherwise in defense of any action, suit or proceeding for which indemnification has been provided under paragraphs 57(a) or (b), or in defense of any claim, issue or matter therein, against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection with such defense. (d) Authorization. Any indemnification under paragraphs 56 or 57 of these Bylaws (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, partner, member, trustee, employee or agent is proper in the circumstances because such person has met the applicable standard of conduct set forth in paragraphs 56 or 57, as the case may be. Such determination shall be made, with respect to a person who is a director or officer of the Corporation at the time of such determination: (i) by a majority vote of the directors who were not parties to such action, suit or proceeding, even though less than a quorum, (ii) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in written opinion, or (iv) by the stockholders. (e) Expense Advance. Expenses (including attorney's fees) incurred by present or former officers or directors of the Corporation in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding as authorized in one of the manners provided in paragraph 57(d) of these Bylaws upon receipt of an undertaking by or on behalf of such person to repay such amount, if it shall ultimately be determined that he or she is not entitled to be indemnified by the Corporation as authorized in these Bylaws. Such expenses (including attorneys' fees) incurred by other employees or agents of the Corporation may be so paid upon such terms and conditions, if any, as the Corporation deems appropriate. (f) Nonexclusivity. The indemnification and advancement of expenses provided by, or granted pursuant to, these Bylaws shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any statute, bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, partner, member, trustee, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. (g) Insurance. The Corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, partner, member, trustee, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise or non-profit entity against any liability asserted against, and incurred by, him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify such person against such liability under the provisions of these Bylaws or Section 145 of the Delaware General Corporation Law. (h) "The Corporation". For the purposes of paragraphs 56 or 57 of these Bylaws references to "the Corporation" shall include, in addition to the resulting corporation and, to the extent that the Board of Directors of the resulting corporation so decides, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers and employees or agents, so that any person who is or was a director, officer, employee or agent of such a constituent corporation or is or was serving at the request of such constituent corporation as director, officer, partner, member, trustee, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise or non-profit entity, shall stand in the same position under the provisions of these Bylaws with respect to the resulting or surviving corporation as he or she would have had with respect to such constituent corporation if its separate existence had continued. (i) Other Indemnification. The Corporation's obligation, if any, to indemnify any person who was or is serving at its request as a director, officer, partner, member, trustee, employee or agent of another corporation, partnership, joint venture, limited liability company, trust or other enterprise or non-profit entity shall be reduced by any amount such person may collect as indemnification from such other corporation, partnership, joint venture, limited liability company, trust or other enterprise or non-profit entity or from insurance. (j) Other Definitions. For purposes of paragraphs 56 or 57 of these Bylaws references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the Corporation" shall include any service as a director, officer, partner, member, trustee, employee or agent of the Corporation which imposes duties on, or involves services by, such director, officer, partner, member, trustee, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the Corporation" as referred to in these Bylaws. (k) Continuation of Indemnification. The indemnification and advancement of expenses provided by, or granted pursuant to, these Bylaws shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, officer, partner, member, trustee, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. (l) Amendment or Repeal. Neither the amendment nor repeal of paragraphs 56 or 57 of these Bylaws nor the adoption of any provision of the Corporation's Certificate of Incorporation inconsistent with paragraphs 56 or 57 of these Bylaws shall reduce, eliminate or adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the effectiveness of such amendment, repeal or adoption. EX-10.1 3 REGISTRANT'S EXECUTIVE DEFERRED COMPENSATION PLAN SEABOARD CORPORATION EXECUTIVE DEFERRED COMPENSATION PLAN EFFECTIVE: JANUARY 1, 1999 ARTICLE I PURPOSE AND EFFECTIVE DATE 1.0.1 Title. This Plan shall be known as the Seaboard Corporation Executive Deferred Compensation Plan. 1.0.2 Purpose. The purpose of the Plan is to defer salary and bonus on a pre-tax basis for certain designated Executives whose Compensation exceeds the maximum allowable deductible amount of compensation for that Plan Year under Section 162(m) of the Code and Treasury Regulations thereunder. The Plan is intended to constitute an unfunded "top hat" arrangement under Title I of ERISA as well as for income tax purposes. 1.0.3 Effective Date. The effective date of this Plan shall be January 1, 1999. ARTICLE II DEFINITIONS AND CONSTRUCTION OF THE PLAN DOCUMENT 2.0.1 Annual Deferral Amount. "Annual Deferral Amount" shall mean that portion of an Executive's salary or bonus for a Plan Year which shall be deferred pursuant to this Plan. In the event of an Executive's Termination of Employment prior to the end of a Plan Year, such year's Annual Deferral Amount shall be the actual amount, if any, deferred prior to such event. 2.0.2 Beneficiary. "Beneficiary" shall mean the person, persons, the estate or other legal entity of or established by an Executive entitled to receive any benefits under this Plan in the event of the Executive's death. 2.0.3 Board. "Board" shall mean the Board of Directors of the Company. 2.0.4 Bookkeeping Account or Bookkeeping Account Balance. "Bookkeeping Account" or "Bookkeeping Account Balance" shall mean with respect to an Executive the sum of (i) his Deferred Compensation, plus (ii) earnings credited in accordance with all the applicable earnings crediting provisions of this Plan, less (iii) all distributions. This account shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to an Executive pursuant to this Plan. 2.0.5 Change of Control. "Change of Control" shall mean an event or transaction which results in one or more of the following: (a) the acquisition by any person or entity (other than by the Company or one of its subsidiaries) of more than fifty percent (50%) of either the outstanding shares of common stock or the combined voting power of the Company's then outstanding voting securities entitled to vote generally in the election of directors; (b) the liquidation of the Company or the sale of more than eighty-five percent (85%) of the assets of the Company to an unrelated person or entity; or (c) the approval by the shareholders of the Company of a reorganization, merger, or consolidation with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger, or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power entitled to vote generally in the election of the directors of the reorganized, merged or consolidated entity's then outstanding voting securities; provided, however, any such merger or consolidation with Seaboard Flour Corporation shall not constitute a Change of Control. 2.0.6 Code. "Code" shall mean the Internal Revenue Code of 1986, as may be amended from time to time. 2.0.7 Company. "Company" shall mean Seaboard Corporation and, for purposes of all references herein to an Executive's Compensation or his employer's deduction, shall include every member of the Company's affiliated group, as determined under Section 1504 of the Code. 2.0.8 Compensation. "Compensation" shall mean an Executive's applicable "employee remuneration" as defined in 162(m)(4) of the Code and the Treasury Regulations issued thereunder. 2.0.9 Crediting Rate. "Crediting Rate" shall have the meaning specified in Section 4.0.2. 2.10 Deferred Compensation. "Deferred Compensation" shall mean the sum of all of an Executive's Annual Deferral Amounts. 2.11 Executive. "Executive" shall mean any member of management or highly compensated employee who is defined as a "covered employee" under Section 162(m)(3) of the Code with respect to any Plan Year, and who is designated to participate in the Plan by the Board. 2.12 Plan. "Plan" shall mean the Seaboard Corporation Executive Deferred Compensation Plan, as described in this instrument and as amended from time to time. 2.13 Plan Administrator. "Plan Administrator" shall mean the Company or such person or persons designated by the Company to act in such capacity. 2.14 Plan Year. "Plan Year" shall mean a calendar year, with the first Plan Year commencing on January 1, 1999. 2.15 Termination of Employment. "Termination of Employment" shall mean the termination of the Executive's employment as an employee of the Company and any division, subsidiary or affiliate thereof. 2.16 Valuation Date. "Valuation Date" shall mean the last day of each calendar quarter and on the date of distribution of the Bookkeeping Account pursuant to Article V. 2.17 Gender and Number. Wherever the context so requires, masculine pronouns include the feminine and singular words shall include the plural. 2.18 Titles. Titles of the Articles of this Plan are included for ease of reference only and are not to be used for the purpose of construing any portion or provision of this Plan document. ARTICLE III DEFERED COMPENSATION 3.0.1 Deferred Compensation. Each Executive shall have a portion of his salary and bonus deferred in accordance with the terms and conditions of this Plan. 3.0.2 Amount of Deferred Compensation. The amount of Compensation which shall be deferred each Plan Year under the Plan shall equal the excess of such Executive's Compensation for any Plan Year (including any bonus that may be paid with respect to such Plan Year in the following year and that, but for Section 162(m) of the Code, would be deductible by the Company in such current Plan Year) over one million dollars ($1,000,000) (or such other amount specified in Section 162(m) of the Code), unless the Board determines a different amount shall be deferred. 3.0.3 Time of Deferrals. Compensation shall not be deferred in any Plan Year until the Executive has been paid Compensation with respect to such Plan Year equal to or exceeding one million dollars ($1,000,000). 3.0.4 Vesting. An Executive shall be fully vested at all times in his Deferred Compensation plus earnings thereon. ARTICLE IV BOOKKEEPING ACCOUNT AND CREDITING RATE 4.0.1 Bookkeeping Account. Compensation deferred with respect to an Executive under Section 3.0.1 herein shall be credited to a Bookkeeping Account maintained for each Executive, and distributions pursuant to Article V or VI shall be subtracted from the Executive's Bookkeeping Account. 4.0.2 Crediting Rate. On each Valuation Date, each Executive's Bookkeeping Account shall be credited with an amount equal to the deemed earnings which would have been realized by the Company if such Bookkeeping Account were invested in an investment vehicle earning a rate or return equal to the eight percent (8%) (the "Crediting Rate"). Such earnings shall be determined pursuant to the method or methods deemed appropriate by the Plan Administrator in its discretion, which methods vary from time to time, as deemed appropriate by the Plan Administrator. The method prescribed herein to determine the Crediting Rate applicable to the Executive's Bookkeeping Account shall in no way require that the Company make any investment of Company assets in such investment nor entitle the Executive to any rights or interest in any investment held by the Company outright or in trust. ARTICLE V DISTRIBUTION 5.0.1 Distribution of Bookkeeping Account Balance. Upon Termination of Employment, an Executive shall be entitled to the balance in his Bookkeeping Account payable in accordance with the provisions of sections 5.0.2 and 5.0.3 herein. 5.0.2 Form of Distribution. All distributions of an Executive's Bookkeeping Account shall be made in cash. 5.0.3 Timing of Distribution. Distributions shall be paid in a lump sum as soon as administratively feasible in the Plan Year immediately following the Plan Year of the Executive's Termination of Employment. Notwithstanding the above, in the event of a Change of Control, the balance in an Executive's Bookkeeping Account shall become immediately distributable to the Executive within thirty (30) days after the Change of Control. 5.0.4 Death Prior to Commencement of Benefit Payments. In the event of an Executive's death prior to the payment of his Bookkeeping Account hereunder, an amount equal to the Executive's Bookkeeping Account Balance shall be paid to the Executive's designated Beneficiary in a lump sum as soon as administratively feasible after the Executive's death. 5.0.5 Hardship Distributions. At the request of an Executive before or after the Executive's Termination of Employment before distribution of his Account Balance, the Company may, in its sole discretion, accelerate and cause all or part of the value of an Executive's Bookkeeping Account under this Plan to be paid. Accelerated payments at the request of the Executive may be allowed only in the event of a severe and unforeseeable emergency as determined by the Company in its sole discretion, including but not limited to, a disability. Such payment shall cause the Executive's Bookkeeping Account to be reduced by the amount distributed to the Executive. An accelerated distribution may include the amount needed to pay federal, state or local income taxes reasonably anticipated to result from the payment. ARTICLE VI BENEFICIARY 6.0.1 Beneficiary Designation. An Executive shall designate a Beneficiary to receive benefits under the Plan on an appropriate form provided by the Plan Administrator. If more than one Beneficiary is named, the share and/or precedence of each Beneficiary shall be indicated. An Executive shall have the right to change the Beneficiary by submitting to the Plan Administrator a new Beneficiary designation form. 6.0.2 Proper Beneficiary. If the Plan Administrator has any doubt as to the proper Beneficiary to receive payments hereunder, the Plan Administrator shall have the right to withhold such payments until the matter is finally adjudicated. However, any payment made by the Plan Administrator, in good faith and in accordance with this Plan, shall fully discharge the Company from all further obligations with respect to that payment. 6.0.3 Minor or Incompetent Beneficiary. In making any payments to or for the benefit of any minor or an incompetent Beneficiary, the Plan Administrator, in its sole and absolute discretion, may make a distribution to a legal or natural guardian or other relative of a minor or court appointed Plan Administrator of such incompetent. Alternatively, it may make a payment to any adult with whom the minor or incompetent temporarily or permanently resides. The receipt by a guardian, Plan Administrator, relative or other person shall be a complete discharge to the Company. Neither the Company nor the Plan Administrator shall have any responsibility to see to the proper application of any payments so made. 6.0.4 No Beneficiary Designation. If an Executive fails to designate a Beneficiary as provided in Section 6.0.1 above, or if all designated Beneficiaries predecease the Executive or die prior to complete distribution of the Executive's Account Balance, then the Executive's designated Beneficiary shall be deemed to be his surviving spouse. If the Executive has no surviving spouse, the benefits remaining under the Plan to be paid to a Beneficiary shall be payable to the Executive's estate. ARTICLE VII ADMINISTRATION OF THE PLAN 7.0.1 Finality of Determination. Subject to the Plan, the Plan Administrator shall, from time to time, establish rules, forms and procedures for the administration of the Plan. Except as herein otherwise expressly provided, the Plan Administrator shall have the exclusive right to interpret the Plan and to decide any and all matters arising thereunder or in connection with the administration of the Plan, and it shall endeavor to act, whether by general rules or by particular decisions, so as not to discriminate in favor of or against any person. The decisions, actions and records of the Plan Administrator shall be conclusive and binding upon the Company and all persons having or claiming to have any right or interest in or under the Plan, and cannot be overruled by a court of law unless arbitrary or capricious. 7.0.2 Certificates and Reports. The members of the Plan Administrator and the officers and directors of the Company shall be entitled to rely on all certificates and reports made by any duly appointed accountants, and on all opinions given by any duly appointed legal counsel, which legal counsel may be counsel for the Company. 7.0.3 Indemnification and Exculpation. The Company shall indemnify and hold harmless any person or entity designated to act as the Plan Administrator or its designee and each current and former member of the Board against any and all expenses and liabilities (to the extent not indemnified under any liability insurance contract or other indemnification agreement) which the person incurs on account of any act or failure to act in connection with the good faith administration of the Plan. Expenses against which the Plan Administer, its designee or a member of the Board shall be indemnified hereunder shall include, without limitation, the amount of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted, or a proceeding brought or settlement thereof. The foregoing right of indemnification shall be in addition to any other rights to which the Plan Administrator, its designee or such member of the Board may be entitled as a matter of law, but shall be conditioned upon the person's notifying the Company of the claim of liability within sixty (60) days of the notice of that claim and offering the Company the right to participate in and control the settlement and defense of the claim. 7.0.4 Expenses. The expenses of administering the Plan shall be borne by the Company. 7.0.5 FICA and Other Taxes. For each Plan Year in which an Annual Deferral Amount is being credited to an Executive's Bookkeeping Account, the Company shall ratably withhold from that portion of the Executive's Compensation that is not being deferred, the Executive's share of FICA and other employment taxes attributable to such Annual Deferral Amount in accordance with the Treasury Regulations under Section 3121(v) of the Code. ARTICLE VIII CLAIMS PROCEDURE 8.0.1 Written Claim. Benefits shall be paid in accordance with the provisions of this Plan. The Executive, or a designated recipient or any other person claiming through the Executive may make a written request for benefits under this Plan. Any such claim shall be mailed or delivered to the Plan Administrator. Such claim shall be reviewed by the Plan Administrator or a delegate. 8.0.2 Denied Claim. If the claim is denied, in full or in part, the Plan Administrator shall provide a written notice within ninety (90) days setting forth the specific reasons for denial, and any additional material or information necessary to perfect the claim, and an explanation of why such material or information is necessary, and appropriate information and explanation of the steps to be taken if a review of the denial is desired. 8.0.3 Review Procedure. If the claim is denied and a review is desired, the Executive (or Beneficiary) shall notify the Plan Administrator in writing within sixty (60) days after receipt of the written notice of denial. In requesting a review, the Executive or Beneficiary may request a review of pertinent documents with regard to the benefits created under this agreement, may submit any written issues and comments, may request an extension of time for such written submission of issues and comments, and may request that a hearing be held, but the decision to hold a hearing shall be within the sole discretion of the Plan Administrator. 8.0.4 Plan Administrator Review. The decision on the review of the denied claim shall be rendered by the Plan Administrator within sixty (60) days after the receipt of the request for review (if no hearing is held) or within sixty (60) days after the hearing if one is held. The decision shall be written and shall state the specific reasons for the decision including reference to specific provisions of this Plan on which the decision is based. ARTICLE IX NATURE OF COMPANY'S OBLIGATION 9.0.1 Company's Obligation. The Company's obligations under this Plan shall be an unfunded and unsecured promise to pay. The Company shall not be obligated under any circumstances to fund its obligations under this Plan. 9.0.2 Creditor Status. Any assets which the Company may acquire or set aside to help cover its financial liabilities under the Plan are and must remain general assets of the Company subject to the claims of its creditors. Neither the Company nor this Plan gives an Executive or Beneficiary any beneficial ownership interest in any asset of the Company. All rights of ownership in any such assets are and remain in the Company. All Plan Executives and Beneficiaries shall be unsecured general creditors of the Company. ARTICLE X MISCELLANEOUS 10.0.1 Written Notice. Any notice given under the Plan shall be in writing and shall be mailed by United States mail, postage prepaid. If notice is to be given to the Company, such notice shall be addressed to the Plan Administrator at Seaboard Corporation. If notice is to be given to the Executive, such notice shall be sent to the Executive's last known address. 10.0.2 Change of Address. Any Executive may, from time to time, change the address to which notices shall be mailed by giving written notice of such new address. 10.0.3 Merger, Consolidation or Acquisition. The Plan shall be binding upon the Company, its assigns, and any successor to the Company which shall succeed to substantially all of its assets and business through merger, acquisition or consolidation, and upon an Executive, a Beneficiary, assigns, heirs, executors and administrators. 10.0.4 Amendment and Termination. The Company retains the sole and unilateral right to terminate, amend, modify, or supplement this Plan, in whole or part, at any time. However, except as provided herein, no Company action under this right shall reduce the Bookkeeping Account of any Executive or Beneficiary. 10.0.5 Employment. This Plan does not provide a contract of employment between the Company and the Executive, and the Company reserves the right to terminate the Executive's employment for any reason, at any time, notwithstanding the existence of this Plan. 10.0.6 Non-transferability. Except insofar as required or prohibited by applicable law, no sale, transfer, alienation, assignment, pledge, collateralization or attachment of any benefits under this Plan shall be valid or recognized by the Company. Neither the Executive or designated Beneficiary shall have any power to hypothecate, mortgage, commute, modify, or otherwise encumber in advance of any of the benefits payable hereunder, nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony, or maintenance, owed by the Executive or Beneficiary, or be transferable by operation of law in the event of bankruptcy, insolvency, or otherwise. 10.0.7 Tax Withholding. The Company may withhold from a payment any federal, state, or local taxes required by law to be withheld with respect to such payment and such sum as the Company may reasonably estimate as necessary to cover any taxes for which the Company may be liable and which may be assessed with regard to such payment. 10.0.8 Acceleration of Payment. The Company reserves the right to accelerate the payment of any benefits payable under this Plan at any time without the consent of the Executive, the Executive's estate, a Beneficiary or any other person claiming through the Executive. 10.0.9 Applicable Law. This Plan shall be governed by the laws of the State of Kansas to the extent not pre-empted by federal law. IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly authorized officer on this 15th day of March, 1999, effective as of the 1st day of January, 1999. SEABOARD CORPORATION By: /s/ J. E. Rodrigues EX-27 4 FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FIRST QUARTER 10-Q FILING AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS DEC-31-1999 MAR-31-1999 16708 129917 177415 0 240826 601079 890129 331932 1223079 366930 0 0 0 1488 448931 1223079 367607 367607 327311 327311 30000 0 9591 3727 2694 1033 0 0 0 1033 .69 .69
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