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)
January 29, 1997
Farmer Mac Mortgage Securities Corporation
(Exact Name of Registrant as Specified in its Charter)
Delaware 333-6325 52-1779791
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) 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)
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 $17,737,800 in aggregate principal amount of
its Guaranteed Agricultural Mortgage-Backed Securities, Series 1/29/97 (the
"Certificates") on January 29, 1997. 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 January 24, 1997, to
file a copy of the Issue Supplement, attached hereto as Exhibit 4.2.3, and a
copy of the Terms Agreement, attached hereto as Exhibit-1.1.3. In addition,
the Registrant is filing, as Exhibit 23.3.3 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 January 1, 1997.
Item 7. Financial Statements; Pro Forma Financial Information and
Exhibits
(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
1.1.3. Terms Agreement, dated as of January 24, 1997,
among Farmer Mac Mortgage Securities Corporation,
Federal Agricultural Mortgage Corporation and Bear,
Stearns & Co., Inc.
4.2.3. Issue Supplement, dated as of January 1, 1997,
among Farmer Mac Mortgage Securities Corporation, as
Depositor, Federal Agricultural Mortgage Corporation,
as Guarantor, and First Trust National Association,
N.A., as Trustee.
23.3.3. 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:/s/ Christopher A. Dunn
Name: Christopher Dunn
Title: Vice President
Dated: January 30, 1997
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page No.
1.1.3. Terms Agreement.
4.2.3. Issue Supplement.
23.3.3. Consent of KPMG Peat Marwick LLP
EXHIBIT 1.1.3
EXECUTION
FARMER MAC MORTGAGE SECURITIES CORPORATION
Guaranteed Agricultural Mortgage-Backed Securities
Series 1/29/97
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 January 24, 1997
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 1/29/97
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 1/29/97 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:
<PAGE>
<TABLE>
<CAPTION>
Class Purchase
Class Original Principal Pass-Through Price Percentage
Amount Rate (net of Underwriting
fees)
<S> <C> <C> <C>
Pool AA1005 $3,467,000 (1) 102.046875 %
Pool AS1006 6,352,400 (1) 101.750000
Pool CA1004 2,618,000 (1) (2)
Pool CS1004 5,300,400 (1) 100.687500
</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 expected that the Pass-Through Rates for the
initial Interest Accrual Periods on the Pool AA1005, Pool AS1006, Pool
CA1004 and Pool CS1004 Certificates will be approximately 7.807%,
7.488%, 7.429% and 7.123%, respectively, per annum.
(2) The Purchase Price for Pool CA1004 shall be (a) $1,460,896.25 plus
accrued interest on an original principal amount of $1,448,000 at
7.335% per annum from and including the Cut-off Date up to, but not
including, the Closing Date as defined in Section 3 and (b) the
Certificates evidencing the entire beneficial ownership interest in
Pool CA1002, having a current principal balance of $1,170,000.
(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, January 29, 1997 (the
"Closing Date"); except that the Purchase Price for Pool CA1004 shall be as
set forth in footnote (2) above.
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/Christopher A. Dunn
Name: Christopher A. Dunn
Title: Vice President
FARMER MAC MORTGAGE SECURITIES CORPORATION
By: /s/CHristopher A. Dunn
Name: Christopher A. Dunn
Title: Vice President
EXHIBIT 4.2.3
EXECUTION
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
ISSUE SUPPLEMENT
Dated as of January 1, 1997
TO TRUST AGREEMENT
FOR GRANTOR TRUSTS
Dated as of June 1, 1996
for
GUARANTEED AGRICULTURAL MORTGAGE-BACKED SECURITIES
Series Designation Issue Date
Series 1/29/97 January 29, 1997
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 applicability 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 established 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
January 1, 1997 (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 authorized 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 determination 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>
<CAPTION>
Month of Each Initial
Class Distribution Date Distribution Date
<S> <C> <C>
AA1005 January January 25, 1998
AS1006 January and July July 25, 1997
CA1004 January January 25, 1998
CS1004 January and July July 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
(a) all Curtailments received with respect to the Qualified
Loans in such Qualified Loan Pool during the preceding Prepayment
Period for such Qualified Loan Pool;
<PAGE>
(b) 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;
(c) 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
(d) 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 Applicable 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: January 29, 1997.
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: January 1, 1997.
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 hereinafter set forth. The Class designations, original
Class Certificate Principal Balances and Final Distribution Dates shall be as
follows:
<PAGE>
<TABLE>
<CAPTION>
Original Class
Certificate
Designation Principal Final Distribution
Balance Date
<S> <C> <C>
Class AA1005 $ 3,467,000 January 25, 2012
Class AS1006 6,352,400 January 25, 2012
Class CA1004 2,618,000 January 25, 2002
Class CS1004 5,300,400 January 25, 2002
</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/ Christopher A. Dunn
Christopher A. Dunn
Attest: Vice President
FARMER MAC MORTGAGE
SECURITIES CORPORATION
[SEAL]
By /s/ Christopher A. Dunn___________
Christopher A. Dunn
Attest Vice President
FIRST TRUST NATIONAL
ASSOCIATION, as Trustee
[SEAL]
By:____/s/ Eve D. Kaplan
Eve D. Kaplan
Attest: Vice President
EXHIBIT 23.3.3
Consent of KPMG Peat Marwick LLP
<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 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
Washington, D.C.
January 24, 1997
