Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): January 11, 2011
FEDERAL
AGRICULTURAL MORTGAGE CORPORATION
(Exact
Name of Registrant as Specified in Charter)
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Federally
chartered instrumentality
of
the United States
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001-14951
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52-1578738
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(State
or Other Jurisdiction
of
Incorporation)
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(Commission
File
Number)
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(IRS
Employer Identification No.)
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1133
Twenty-First Street, N.W., Suite 600, Washington D.C.
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20036
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code (202) 872-7700
No
change
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General
Instruction A.2. below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Section
1 – Registrant’s Business and Operations
Item
1.01. Entry into a Material Definitive Agreement.
On
January 11, 2011, the Federal Agricultural Mortgage Corporation (“Farmer Mac”)
entered into a $1.5 billion credit facility with the National Rural
Utilities Cooperative Finance Corporation (“CFC”), which has a “related party”
relationship with Farmer Mac as the result of CFC’s ownership of Farmer Mac
common stock. The credit facility is evidenced by the following
agreements: (1) a Note Purchase Agreement dated as of
January 11, 2011 (the “Note Purchase Agreement”) between Farmer Mac, Farmer
Mac Mortgage Securities Corporation, a wholly owned subsidiary of Farmer Mac
(“FMMSC”), and CFC; (2) a Pledge Agreement dated as of January 11,
2011 (the “Pledge Agreement”) between Farmer Mac, FMMSC, CFC and U.S. Bank
National Association, as collateral agent; and (3) a Setoff Rights Letter
Agreement dated as of January 11, 2011 (the “Letter Agreement”) between
Farmer Mac, FMMSC and CFC.
The Note
Purchase Agreement provides CFC the ability to borrow money evidenced by general
obligation notes sold to FMMSC and secured by eligible rural utilities
loans. Farmer Mac will guarantee the timely payment of interest and
principal on any notes issued and sold by CFC under the Note Purchase
Agreement. The Note Purchase Agreement is structured as a revolving
borrowing facility with an initial draw period of five years and a maximum
principal amount of notes outstanding at any time of $1.5
billion. This initial draw period will be extended for an additional
year on an annual basis unless notice of non-renewal is given by Farmer
Mac. Each note will accrue interest at a fixed or floating rate and
will mature, in each case, as determined at the time of issuance. The
Pledge Agreement provides for the pledge by CFC to the collateral agent, for the
benefit of Farmer Mac and FMMSC, of eligible rural utilities loans made by CFC
to its members to secure CFC’s obligations under the Note Purchase Agreement, in
an amount equal to at least 100% of the outstanding principal amount of notes
issued and sold by CFC under the Note Purchase Agreement. The Letter
Agreement provides that in the event of a payment default by CFC under the Note
Purchase Agreement, Farmer Mac shall have the right to setoff any amounts due to
CFC in respect of Farmer Mac’s Series C Preferred Stock that is held by
CFC. As of the date of this report, CFC had not sold any notes to
FMMSC under the Note Purchase Agreement.
CFC is
the second-largest owner of Farmer Mac’s Class A voting common stock, and is
named as a holder of more than 5% of Farmer Mac’s Class A voting common stock in
Farmer Mac’s Proxy Statement dated April 28, 2010 and filed with the SEC on
April 29, 2010. The three agreements described above were entered
into on an arms-length basis in the ordinary course of business, with terms and
conditions comparable to those available to other program participants that do
not have a related party relationship with Farmer Mac.
Section
7 – Regulation FD
Item
7.01. Regulation FD Disclosure.
On
January 18, 2011, Farmer Mac and CFC issued a joint press release to announce
their entry into the $1.5 billion credit facility described above. A
copy of the press release is attached to this report as Exhibit
99.
Section
9 – Financial Statements and Exhibits
Item
9.01. Financial Statements and Exhibits.
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99.
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Press
Release dated January 18, 2011.
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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 hereunto duly
authorized.
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FEDERAL
AGRICULTURAL MORTGAGE
CORPORATION
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By:
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/s/ Timothy
L. Buzby |
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Name:
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Timothy
L. Buzby |
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Title: |
Senior
Vice President – Chief Financial Officer |
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Dated:
January 18, 2011