Attached files
file | filename |
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8-K - FEDERAL AGRICULTURAL MORTGAGE CORP | v172150_8k.htm |
EX-99.2 - FEDERAL AGRICULTURAL MORTGAGE CORP | v172150_ex99-2.htm |
NEWS
FOR IMMEDIATE
RELEASE
|
CONTACT
|
January
25, 2010
|
Richard
Eisenberg
|
|
(Investor
Inquiries)
|
Mary
Waters
|
|
(Media
Inquiries)
|
|
202-872-7700
|
Farmer
Mac Announces Completion of $250 Million Securities Offering
Washington,
D.C. — The Federal Agricultural Mortgage Corporation (Farmer Mac, NYSE: AGM and
AGM.A) announced today the completion of a private offering of securities
consisting of $250 million aggregate face amount of Farm Asset Linked
Capital Securities (the “FALConS”) issued by FALConS Trust I, a newly formed
Delaware statutory trust (the “Trust”). The FALConS represent undivided
beneficial ownership interests in 250,000 shares of Non-Cumulative Perpetual
Preferred Stock (the “Company Preferred Stock”) of Farmer Mac’s subsidiary,
Farmer Mac II LLC, a newly formed Delaware limited liability company (the
“Company”). The Company Preferred Stock has a liquidation preference
of $1,000 per share.
The $250
million of proceeds from the offering of the FALConS were used by the Trust to
purchase the Company Preferred Stock from Farmer Mac. The Company
issued its Company Preferred Stock and its common equity interest to Farmer Mac
as consideration for the contribution by Farmer Mac to the Company of
substantially all of the assets, in excess of $1.1 billion, comprising the
Farmer Mac II Program business. Farmer Mac began operating the
Farmer Mac II Program after the U.S. Congress amended its statutory charter in
1990 to permit Farmer Mac to buy and sell guaranteed portions of certain newly
originated and seasoned agricultural, rural development, business and industry
and community facilities loans guaranteed by the United States Department of
Agriculture pursuant to the Consolidated Farm and Rural Development
Act. Going forward, the Farmer Mac II Program business will be
operated by the Company. Farmer Mac will use the proceeds from the
sale of the Company Preferred Stock to the Trust to repurchase and retire its
outstanding Series B-1 Senior Cumulative Perpetual Preferred Stock, Series B-2
Senior Cumulative Perpetual Preferred Stock and Series B-3 Senior Cumulative
Perpetual Preferred Stock having an aggregate liquidation preference of
$150 million, and for general corporate purposes.
Dividends
on the Company Preferred Stock will be payable if, when and as declared by the
Company’s Board of Directors, quarterly (each quarter, a “Quarterly Period”), on
a non-cumulative basis, on March 30, June 30, September 30 and December 30 of
each year (each, a “Payment Date”), commencing on March 30, 2010. For
each Quarterly Period from the date of issuance of the FALConS to but excluding
the Payment Date occurring on March 30, 2015, the dividend rate on the Company
Preferred Stock will be 8.875% per annum. For each Quarterly Period
from March 30, 2015 to but excluding the Payment Date occurring on March 30,
2020, the dividend rate on the Company Preferred Stock will be 10.875% per
annum. For each Quarterly Period beginning on March 30, 2020, the
dividend rate on the Company Preferred Stock will be an annual rate equal to
three-month LIBOR plus 8.211%. Dividends on the Company Preferred
Stock will not be cumulative, which means that dividends that are not declared
for a Payment Date will not accrue. The FALConS and the Company
Preferred Stock are perpetual and have no maturity date, and holders of the
FALConS have no redemption rights.
This
press release does not constitute an offer to sell, or the solicitation of an
offer to buy, nor shall there be any sale of the FALConS in any jurisdiction in
which such offer, solicitation or sale would be unlawful. The FALConS
have not been registered under the Securities Act of 1933 (the “Securities Act”)
or any state securities laws and may not be offered or sold in the United States
absent registration or an applicable exemption from registration requirements of
the Securities Act and applicable state securities laws. The FALConS
have been offered only to persons who are both “qualified institutional buyers”
in reliance on Rule 144A under the Securities Act and “qualified purchasers”
within the meaning of Section 2(a)(51) of the Investment Company Act of 1940, as
amended. This notice is being issued pursuant to Rule 135c under
the Securities Act.
Farmer
Mac is a stockholder-owned instrumentality of the United States chartered by
Congress to establish a secondary market for agricultural real estate and rural
housing mortgage loans and rural utilities loans and to facilitate capital
market funding for USDA-guaranteed farm program and rural development
loans. Farmer Mac’s Class C non-voting and Class A voting common
stocks are listed on the New York Stock Exchange under the symbols AGM and
AGM.A, respectively.
* * *
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