SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported)
October 30, 1996
Farmer Mac Mortgage Securities Corporation
(Exact Name of Registrant as Specified in its Charter)
Delaware 333-6325 52-1779791
(State or Other Jurisdiction (Commisson (I.R.S. Employer
ofIncorporation) File Number) Identification No.)
919 18th Street, N.W. 20006
Washington, D.C. (Zip Code)
(Address of Principal
Executive Offices)
Registrant's telephone number, including area code (202) 872-7700
No Change
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 5. OTHER EVENTS
A. The Registrant registered issuances of Guaranteed
Agricultural Mortgage-Backed Securities on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Act"), by a Registration Statement on Form
S-3 (Registration File No. 333-6325)(the "Registration
Statement"). Pursuant to the Registration Statement, the
Registrant issued approximately $12,701,360 in aggregate
principal amount of its Guaranteed Agricultural Mortgage-Backed
Securities, Series 10/30/96 (the "Certificates") on October 30,
1996. This Current Report on Form 8-K is being filed to satisfy
an undertaking, in connection with the Prospectus dated June 26,
1996 and the Prospectus Supplement dated October 29, 1996, to
file a copy of the Issue Supplement, attached hereto as Exhibit
4.2.1, and a copy of the Terms Agreement, attached hereto as
Exhibit 1.1.1. In addition, the Registrant is filing, as Exhibit
23.3.1 attached hereto, a consent by KPMG Peat Marwick LLP to the
use of their report incorporated into the Registration Statement
by reference and to the reference to KPMG Peat Marwick LLP under
the heading "Experts" in the Prospectus Supplement.
The Certificates were issued pursuant to a Trust Agreement
(filed as Exhibit 4.1 to a Form 8-K dated June 27, 1996), dated
as of June 1, 1996 among Farmer Mac Mortgage Securities
Corporation, as Depositor, Federal Agricultural Mortgage
Corporation, as Guarantor, and First Trust National Association,
N.A., as Trustee, as supplemented by an Issue Supplement, dated
as of October 1, 1996.
<PAGE>
Item 7. FINANCIAL STATEMENTS; PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
1.1.1. Terms Agreement, dated as of
October 29, 1996, among Farmer Mac
Mortgage Securities Corporation,
Federal Agricultural Mortgage
Corporation and Bear, Stearns &
Co., Inc.
4.2.1. Issue Supplement, dated as of October
1, 1996, among Farmer Mac Mortgage
Securities Corporation, as Depositor,
Federal Agricultural Mortgage
Corporation, as Guarantor, and First
Trust National Association, N.A., as
Trustee.
23.3.1. Consent of KPMG Peat Marwick LLP.
<PAGE>
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.
FARMER MAC MORTGAGE SECURITIES
CORPORATION
By:____________________________________
Name: Christopher Dunn
Title: Vice President
Dated: November 8, 1996
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page No.
1.1.1. Terms Agreement.
4.2.1. Issue Supplement.
23.3.1. Consent of KPMG Peat Marwick LLP
<PAGE>
EXHIBIT 1.1.1
Terms Agreement
<PAGE>
EXHIBIT 4.2.1
Issue Supplement
<PAGE>
EXHIBIT 23.3.1
Consent of KPMG Peat Marwick LLP
<PAGE>
EXECUTION
FARMER MAC MORTGAGE SECURITIES CORPORATION
Guaranteed Agricultural Mortgage-Backed Securities
Series 10/30/96
Guaranteed by the Federal Agricultural Mortgage Corporation
TERMS AGREEMENT
(to Underwriting Agreement,
dated June 26, 1996,
among the Company, Farmer Mac and the Underwriter)
Farmer Mac Mortgage Securities Corporation October 29, 1996
919 18th Street, N.W.
Washington D.C. 20006
Federal Agricultural Mortgage Corporation
919 18th Street, N.W.
Washington D.C. 20006
Bear, Stearns & Co. Inc. (the "Underwriter") agrees,
subject to the terms and provisions herein and of the captioned
Underwriting Agreement (the "Underwriting Agreement"), to
purchase the Classes of Series 10/30/96 Certificates specified in
Section 1(a) hereof (the "Offered Certificates"). This Terms
Agreement supplements and modifies the Underwriting Agreement
solely as it relates to the purchase and sale of the Offered
Certificates described below. The Series 10/30/96 Certificates
are registered with the Securities and Exchange Commission by
means of an effective Registration Statement (No. 333-6325).
Capitalized terms used and not defined herein have the meanings
given them in the Underwriting Agreement or Trust Agreement, as
applicable.
Section 1. THE QUALIFIED LOAN POOLS: The Qualified
Loan Pools shall have the characteristics described in the
Prospectus Supplement.
Section 2. THE CERTIFICATES: The Offered
Certificates shall be issued as follows:
(a) CLASSES: The Offered Certificates shall be issued
with the following Class designations, interest rates and
principal balances, subject in the aggregate to the variance
referred to in the Prospectus Supplement:
<TABLE>
Class
Original Pass- Purchase
Principal Through Price
Class Amount Rate Percentage
<S> <C> <C> <C> <C>
Pool AA1002 $2,250,500 (1) 100.281250%
Pool AS1003 4,630,860 (1) 101.156250
Pool CA1001 2,495,000 (1) 100.609375
Pool CS1001 3,325,000 (1) 100.296875
</TABLE>
(1) On each applicable Distribution Date, the Pass-Through Rate
for each Class of Certificates will be a rate per annum
equal to the weighted average of the Net Mortgage rates for
the Qualified Loans in the related Pool. It is exepected
that the Pass-Through Rates for the initial Interest Accrual
Periods on the Class AA1002, Class AS1003, Class CA1001 and
Class CS1001 Certificates will be approximately 7.891%,
7.722%, 7.589% and 7.186%, respectively, per annum.
(b) The Offered Certificates shall have such other
characteristics as described in the related Final
Prospectus.
Section 3. PURCHASE PRICE: The Purchase Price for
each Class of the Offered Certificates shall be the Class
Purchase Price Percentage therefor (as set forth in Section 2(a)
above) plus accrued interest at the applicable initial Pass-
Through Rate per annum of each such Class from and including the
Cut-off Date up to, but not including, October 30, 1996 (the
"Closing Date").
In the event that proceeds to the Underwriter from its
distribution of the Class CA1001 Certificates and/or the Class
CS1001 Certificates exceed the applicable Class Purchase Price
Percentage shown above, the Purchase Price for the applicable
Class of Certificates shall be increased according to the
following formula:
The Purchase Price will equal (a) the applicable Class
Purchase Price Percentage set forth in Section 2(a) above, plus
(b) the difference between (i) the actual price of the applicable
Class of Certificates calculated at the spread to the then
current five-year U.S. Treasury security and (ii) the price of
such Class of Certificates calculated at a spread of 60 basis
points over such Treasury security, less (c) an underwriting
spread of 0.25%. In the event the Purchase Price so calculated
is less than the applicable Purchase Price Percentage set forth
in Section 2(a), no additional proceeds will be paid by the
Underwriter to the Company with respect to the relevant Class of
Certificates.
Section 4. TAX TREATMENT: No election will be made
to treat the assets of the Trust Fund as a REMIC.
* * * * *
<PAGE>
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
undersigned a counterpart hereof, whereupon this letter and your
acceptance shall represent a binding agreement among the
Underwriter, Farmer Mac and the Company.
Very truly yours,
BEAR, STEARNS & CO. INC.
By: /s/Jeffrey Mayer
Name:Jeffrey Mayer
Title:Senior Managing Director
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
By: /s/ Henry D. Edelman
Name: Henry D. Edelman
Title: President and CEO
FARMER MAC MORTGAGE SECURITIES CORPORATION
By: /s/ Christopher A. Dunn
Name: Christopher A. Dunn
Title: Vice President
<PAGE>
Execution
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
ISSUE SUPPLEMENT
Dated as of October 1, 1996
TO TRUST AGREEMENT
FOR GRANTOR TRUSTS
Dated as of June 1, 1996
for
GUARANTEED AGRICULTURAL MORTGAGE-BACKED SECURITIES
Series Designation Issue Date
Series 10/30/96 October 30, 1996
THIS ISSUE SUPPLEMENT accompanies and supplements a certain
Trust Agreement for Grantor Trusts, dated as of June 1, 1996 (the
"Trust Agreement"), among the Federal Agricultural Mortgage
Corporation, a federally chartered instrumentality of the United
States ("Farmer Mac"), Farmer Mac Mortgage Securities
Corporation, a corporation organized and existing under the laws
of the State of Delaware (the "Depositor") and First Trust
National Association, a national banking association (the
"Trustee"). Unless otherwise specified, certain capitalized
terms are defined in such Trust Agreement and shall have the
meanings so defined.
The collective terms of such Trust Agreement and this Issue
Supplement shall govern the composition of the Trust Fund, the
beneficial ownership of which is evidenced by the Series of
Certificates having the above designation, and have no applica
bility to any other Trust Fund. If any provision of this Issue
Supplement conflicts with or contradicts a provision of the Trust
Agreement, the provisions of this Issue Supplement shall control.
The Depositor, does hereby transfer, assign, set over and
otherwise convey to the Trustee for the Holders of Certificates
evidencing beneficial ownership interests in the Trust Fund estab
lished hereby (i) all of the Depositor's right, title and
interest in and to the Qualified Loans identified in the
Qualified Loan Schedule attached as Schedule I hereto, including
all payments of principal and interest thereon received after
October 1, 1996 (the "Cut-Off Date") other than payments of
principal due and interest accruing on or before the Cut-off Date
and (ii) all of the Depositor's rights, as assignee of Farmer
Mac, under each Loan Sale Agreement providing for the sale of the
Qualified Loans identified in the Qualified Loan Schedule
attached as Schedule I hereto, including, but not limited to, the
right to enforce the representations and warranties therein
against the related Seller.
Section 1. CERTAIN DEFINED TERMS INAPPLICABLE. The
following terms defined in Section 1.01 of the Trust Agreement
shall have no applicability to the Series of Certificates author
ized hereby: "Class Notional Principal Balance," "Interest Only
Certificates," "Interest Only Class," "Notional Principal
Balance", "Participation Certificate", "Special Distribution
Date" and "Special Record Date."
Section 2. CERTAIN DEFINED TERMS REDEFINED. The following
terms defined in Section 1.01 of the Trust Agreement are modified
to have the following meanings for the Series of Certificates
authorized hereby:
CERTIFICATE: A Guaranteed Agricultural Mortgage-Backed
Security, which, in the case of all Classes of Certificates,
shall be issued in book-entry form and maintained in the name of
a record owner as an entry on the books of a Reserve Bank under a
designation specifying the Series, Class and denomination
thereof.
CERTIFICATE DISTRIBUTION AMOUNT: With respect to each Class
and Distribution Date, the sum of
(a) all interest accrued at the related Certificate
Interest Rate during the preceding Interest Accrual Period
for such Class on the Class Certificate Principal Balance
thereof immediately preceding such Distribution Date; and
(b) the Principal Distribution Amount on such date for
the Qualified Loan Pool bearing the same alpha-numerical
designation as such Class.
CERTIFICATE INTEREST RATE: For each Class and Distribution
Date, a variable rate per annum equal to the weighted average (by
Scheduled Principal Balance) carried to three decimal places,
rounded down, of the Net Mortgage Rates of the Qualified Loans in
the Qualified Loan Pool bearing the same alpha-numerical
designation as such Class.
CERTIFICATE PRINCIPAL BALANCE: As to any Certificate, prior
to the related initial Distribution Date, the Denomination
thereof and, subsequent to such initial Distribution Date, the
Denomination thereof multiplied by the then applicable
Certificate Principal Factor.
CERTIFICATE PRINCIPAL FACTOR: As to any date of determina
tion and as to any Class of Certificates, a fraction the
numerator of which is (i) the aggregate of the Denominations of
all Certificates of such Class minus (ii) the aggregate amount of
all Principal Distribution Amounts, if any, distributed thereto
prior to such date of determination and the denominator of which
is the aggregate of the Denominations of all Certificates of such
Class.
CERTIFICATEHOLDER OR HOLDER: As to any Certificates, the
record owner on the appropriate Reserve Bank's books.
CLASS CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class of Certificates, at any time, the aggregate of the
Certificate Principal Balances of all Certificates of such Class.
DISTRIBUTION DATE: As to each Class, the 25th day of each
month specified in the table below (or if such 25th day is not a
Business Day, the Business Day immediately following), commencing
on the date specified:
<TABLE>
Month of Each Initial
Class Distribution Date Distribution Date
<S> <C> <C>
AA1002 January January 25, 1997
AS1003 January and July January 25, 1997
CA1001 January January 25, 1997
CS1001 January and July January 25, 1997
</TABLE>
DUE PERIOD: With respect to any Qualified Loan Pool and
Distribution Date, the period beginning immediately following the
preceding Due Period (or the day immediately following the Cut-
Off Date in the case of the initial Distribution Date) and ending
on and including the first day of the month of such Distribution
Date.
FINAL DISTRIBUTION DATE: As to any Class, the Distribution
Date specified as such for such Class in Section 4 hereof.
PREPAYMENT PERIOD: As to each Qualified Loan Pool and
Distribution Date, the preceding Due Period for such Qualified
Loan Pool.
PRINCIPAL DISTRIBUTION AMOUNT: With respect to each
Qualified Loan Pool and Distribution Date, the sum of
_. all Curtailments received with respect to the
Qualified Loans in such Qualified Loan Pool during the
preceding Prepayment Period for such Qualified Loan Pool;
(a) the Scheduled Principal Balance of each Qualified
Loan in such Qualified Loan Pool which was the subject of a
Principal Prepayment in Full during the preceding Prepayment
Period or which became a Liquidated Qualified Loan (or which
was repurchased from the Trust Fund as permitted or required
pursuant to the Trust Agreement) during such preceding
Prepayment Period for such Qualified Loan Pool;
(b) the principal component of each Installment
Payment (including any Balloon Payment) due in respect of
each Qualified Loan included in such Qualified Loan Pool
during the preceding Due Period for such Qualified Loan
Pool; and
(c) if such Distribution Date is the Final
Distribution Date for the related Class of Certificates, any
amount by which the Class Certificate Principal Balance
therefor would be greater than zero after distribution of
the amounts specified in (a) - (c) above.
QUALIFIED LOAN SCHEDULE: As of any date of determination,
the schedule of Qualified Loans included in the Trust Fund,
separately identifying each Qualified Loan Pool, the Field
Servicer's Fee and Administrative Fee for each Qualified Loan.
The initial schedule is attached as Schedule I hereto.
Section 3. DEFINED TERMS APPLICBLE TO ISSUE SUPPLEMENT.
Whenever used in this Issue Supplement, the following words and
phrases shall have the following meanings:
ADMINISTRATIVE FEE: The per annum rate identified as such
for each Qualified Loan set forth in the Qualified Loan Schedule.
CENTRAL SERVICER: Equitable Agri-Business, Inc., a Delaware
corporation.
CENTRAL SERVICING FEE RATE: An amount as described in the
supplement to the Servicing Contract between Farmer Mac and the
Central Servicer.
CLOSING DATE: October 30, 1996.
COLLECTED PREPAYMENT PREMIUMS: With respect to each Class
of Certificates and Distribution Date, the aggregate of
Prepayment Premiums received during the preceding Due Period by
the Central Servicer, in each case, in respect of the Qualified
Loan Pool bearing the same alpha-numerical designation as such
Class.
CUT-OFF DATE: October 1, 1996.
FIELD SERVICER'S FEE: The per annum rate identified as such
for each Qualified Loan set forth in the Qualified Loan Schedule.
GUARANTEE FEE: 0.50% per annum.
INTEREST ACCRUAL PERIOD: As to each Class and Distribution
Date, the period from the first day of the month of the preceding
Distribution Date (or in the case of the initial Distribution
Date for a Class, from the Cut-off Date) to and including the
last day of the month preceding the month of such Distribution
Date.
LIQUIDATED QUALIFIED LOAN: Any defaulted Qualified Loan as
to which Farmer Mac has determined that all amounts it expects to
recover from or on account of such Qualified Loan have been
recovered.
NET MORTGAGE RATE: As to each Qualified Loan, the Mortgage
Rate thereon less the sum of (i) the Administrative Fee and (ii)
the Field Servicer's Fee for such loan.
NET PREPAYMENT PREMIUM: As to each Qualified Loan and each
Collected Prepayment Premium recovered thereon, the amount of the
related prepayment premium or yield maintenance charge calculated
on the basis of the Net Mortgage Rate rather than the Mortgage
Interest Rate of the related Qualified Loan.
QUALIFIED LOAN POOL: Each of the four groups of Qualified
Loans identified in the Qualified Loan Schedule.
TERMINATION PERCENTAGE: One percent.
TERMINATION PRICE: The sum of 100% of the unpaid principal
balance of each outstanding Qualified Loan and any REO Qualified
Loan plus accrued and unpaid interest thereon at the applicable
Mortgage Rate (less any amounts constituting previously
unreimbursed advances).
Section 4. CLASSES OF CERTIFICATES; DISTRIBUTIONS ON
CERTIFICATES. The Series of Certificates authorized by the Trust
Agreement and this Issue Supplement shall be divided into four
Classes of Certificates having the terms and provisions herein
after set forth. The Class designations, original Class Certifi
cate Principal Balances and Final Distribution Dates shall be as
follows:
<TABLE>
Original
Class
Certificate Final
Principal Distribution
Designation Balance Date
<S> <C> <C> <C>
Class AA1002 $2,250,500 January 25, 2012
Class AS1003 4,630,860 July 25, 2011
Class CA1001 2,495,000 January 25, 2002
Class CS1001 3,325,000 July 25, 2001
</TABLE>
On each Distribution Date for a Class of Certificates,
Farmer Mac shall distribute the related Certificate Distribution
Amount and any Net Prepayment Premiums for such Class to the
Certificateholders of such Class as of the related Record Date.
Amounts distributed in respect of clause (b) of the definition of
Certificate Distribution Amount shall be applied in reduction of
the Certificate Principal Balances of the Certificates. All
distributions of the Certificate Distribution Amount and any Net
Prepayment Premiums for a Class shall be applied on a pro rata
basis among the Certificates of such Class. Net Prepayment
Premiums shall not be applied to accrued certificate interest on
or to reduce the Certificate Principal Balance of any
Certificate.
Section 5. FORM AND DENOMINATIONS. The Certificates shall
be issued in book-entry form as provided in Section 3.02(a);
interests therein shall be held in minimum Denominations of
$1,000 and integral multiples of $1 in excess thereof.
Section 6. SERVICING COMPENSATION. For any Distribution
Date, as compensation for its activities and obligations under
the Trust Agreement and hereunder, the Master Servicer shall be
entitled to retain the excess of (i) any Collected Prepayment
Premium for such Distribution over (ii) any Net Prepayment
Premium for such Distribution Date.
Section 7. COLLECTION OF CERTAIN QUALIFIED LOAN PAYMENTS.
Section 4.05 of the Trust Agreement is amended by restating
clause (v) thereof in its entirety as follows:
"(v) Any Net Prepayment Premiums collected on the
Qualified Loans."
Section 8. TERMINATION OF THE TRUST FUND. Section 9.01 of
the Trust Agreement is restated in its entirety as follows:
"The respective obligations and responsibilities of
Farmer Mac and the Trustee created hereby shall terminate
upon the distribution to all Holders of all amounts required
to be distributed hereunder upon (i) the repurchase by
Farmer Mac of all Qualified Loans and REO Property remaining
in the Trust Fund at the Termination Price, (ii) the final
payment of the last Qualified Loan and/or REO Property
remaining in the Trust Fund; or (iii) distribution by Farmer
Mac pursuant to the Farmer Mac Guarantee on the Final
Distribution Date for the Class of Certificates having the
latest Final Distribution Date of an amount sufficient to
reduce the Class Certificate Principal Balance of such Class
to zero; provided, however, that in no event shall any trust
created hereby continue beyond the expiration of 21 years
from the death of the survivor of the descendants of Joseph
P. Kennedy, the late ambassador of the United States of
America to the Court of St. James's, living on the Cut-Off
Date.
The right of Farmer Mac to repurchase all Qualified
Loans and REO Property in the Trust Fund pursuant to clause
(i) above shall be subject to the aggregate Scheduled
Principal Balances of the Qualified Loans being less than
the Termination Percentage of the Scheduled Principal
Balances thereof as of the Cut-Off Date. Any such
repurchase shall take place on a Distribution Date for any
then outstanding Class (regardless of whether such
Distribution Date constitutes a Distribution Date for all
such Classes of Certificates), and the proceeds of any such
repurchase shall be distributed to Holders of the applicable
Classes of Certificates on such Distribution Date, pro rata,
in the first instance in respect of accrued interest and
then, as a distribution of principal.
In connection with any such termination, Farmer Mac
shall make available to financial publications and
electronic services notice for the benefit of Holders of
Certificates to the effect that the final distribution will
be made on the Distribution Date therein specified to
Certificateholders of record on the applicable Record Date."
* * * * * * * * * * *
<PAGE>
IN WITNESS WHEREOF, the parties hereto hereby execute this
Issue Supplement, as of the day and year first above written.
FEDERAL AGRICULTURAL
MORTGAGE CORPORATION
SEAL]
By:/s/ Henry D. Edelman
Henry D. Edelman
Attest:/s/ Michael T. Bennett President and CEO
FARMER MAC MORTGAGE
SECURITIES CORPORATION
[SEAL]
By: /s/Christopher A.Dunn
Christopher A. Dunn
Attest: /s/Michael T. Bennett Vice President
FIRST TRUST NATIONAL
ASSOCIATION, as Trustee
[SEAL]
By: /s/Eve D. Kaplan
Attest: /s/ S. Christopher
<PAGE>
The Board of Directors
Federal Agricultural Mortgage Corporation
We consent to the use of our report incorporated herein by
reference and to the reference to our firm under the heading
"Experts" in the Prospectus Supplement.
Our report dated February 12, 1996, except as to Note 11, which
is as of March 14, 1996, contains an explanatory paragraph
regarding regulatory capital as discussed in Note 3 to the
December 31, 1995 financial statements.
/s/ KPMG Peat Marwick LLP
Washington, D.C.
October 24, 1996
