<PAGE> 1
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)
June 17, 1998
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION
(Exact name of registrant as specified in its charter)
District of Columbia 1-7102 52-0891669
-------------------- ------ ----------
(state or other juris- (Commission (I.R.S Employer
diction of incorporation) File Number) (Identification No.)
Woodland Park, 2201 Cooperative Way, Herndon, VA 22071-3025
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (703) 709-6700
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(Former name or former address, if changed since last report)
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Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits.
(c) Exhibits
The following exhibits are filed herewith:
1. An Amendment dated June 17, 1998 to the Agency Agreement dated June
19, 1996, and amended as of November 14, 1997 and March 30, 1998,
between the Company and the Agents named therein, relating to the
distribution of the Company's Medium-Term Notes, Series C, within
the United States.
2. Calculation Agent Agreement dated June 17, 1998 between the Company
and Lehman Brothers Inc., as Calculation Agent.
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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.
NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION
/s/ Steven L. Lilly
------------------------------------
Steven L. Lilly
Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)
Dated: June 17, 1998
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EXHIBIT 1
EXECUTION COPY
AMENDMENT dated as of June 17, 1998 to the Agency
Agreement dated June 19, 1996, and amended as of November 14,
1997, and March 30, 1998, among National Rural Utilities
Cooperative Finance Corporation (the "Company"), a District of
Columbia cooperative association, Lehman Brothers Inc. (an
"Agent") and Merrill Lynch, Pierce, Fenner & Smith
Incorporated (an "Agent") (such Agency Agreement the
"Agreement").
WHEREAS, the parties hereto have entered into the Agreement;
WHEREAS, the Agreement initially contemplated the issuance and sale
by the Company from time to time of up to $623,599,000 aggregate principal
amount of its Medium-Term Notes, Series C (the "Securities");
WHEREAS, the Agreement was amended as of November 19, 1997, and as
of March 30, 1998, to increase the aggregate principal amount of Securities
permitted be issued and sold by the Company thereunder to $1,373,599,000 and the
aggregate principal amount of Securities permitted to be sold on and after March
30, 1998 to $604,121,000;
WHEREAS, the Company has issued and sold approximately $89,195,000
aggregate principal amount of Securities pursuant to the Agreement and the
Indenture on and after March 30, 1998;
WHEREAS immediately prior to this Amendment taking effect, the
Company's Registration Statements No. 333-38839 and Registration Statement No.
333-47681 remain effective under the Act, with $514,926,000 aggregate principal
amount of Securities remaining unissued and unsold under such Registration
Statements;
WHEREAS, the parties hereto desire to amend the Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
1. The Agreement is hereby amended to include in the definition of
"Registration Statement", as contemplated therein in Section 1(a), Registration
Statement No. 333-53819, previously filed with the Commission and effective as
of June 5, 1998, relating to the registration of $1,000,000,000 aggregate
principal amount of Securities, and to revise the definition of "Prospectus" to
mean the prospectus supplement dated June 16, 1998, relating to the Securities
covered by the Agreement, as amended, together with the prospectus contained in
such Registration Statement.
2. The Agreement is hereby amended to increase the aggregate
principal amount of Securities which may be issued and sold from time to time by
the
<PAGE> 2
Company thereunder to $2,373,599,000 and the aggregate principal amount of
Securities which may be issued and sold from time to time thereunder on or after
the date hereof to $1,514,926,000.
3. The Agreement is hereby amended by deleting Section 11 of the
Agreement in its entirety and replacing it with the following:
Section 11. Purchases as Principal. From time to time either Agent may
agree with the Company to purchase Securities from the Company as
principal, in which case such purchase shall be made in accordance with
the terms of a separate agreement (a "Purchase Agreement") to be entered
into between such Agent and the Company. The Purchase Agreement may be
either an oral agreement or a written agreement in the form attached
hereto as Exhibit C. A Purchase Agreement, to the extent set forth
therein, may incorporate by reference specified provisions of this
Agreement. Either Agent, acting as principal, may also purchase Securities
at a discount for resale to investors or other purchasers at varying
prices related to prevailing market prices at the time of resale as
determined by the applicable Agent or, if so agreed, at a fixed public
offering price. Unless otherwise specified in the applicable Supplement,
any Security sold to an Agent as principal will be purchased by such Agent
at a price equal to 100% of the principal amount thereof less a percentage
equal to the commission applicable to an agency sale of a Security of
identical maturity.
4. The Agreement is hereby amended by deleting Exhibit A to the
Agreement and replacing it with Exhibit A attached hereto.
5. This Amendment shall become effective only on the satisfaction
(or waiver by the Agents) of the conditions in Section 5 of the Agreement with
respect to the Closing Date for this Amendment.
Except as expressly amended hereby, the Agreement shall continue in
full force and effect in accordance with the provisions thereof as in existence
on the date hereof.
All capitalized terms not defined herein have the meanings assigned
to them in the Agreement.
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IN WITNESS WHEREOF, the parties hereto have each caused this Amendment to
be fully executed as of the date first above written.
NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION
by
------------------------------------
Name:
Title:
LEHMAN BROTHERS INC.
by
------------------------------------
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED
by
------------------------------------
Name:
Title:
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EXHIBIT A
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
Medium-Term Notes, Series C
Schedule of Payments
The Company agrees to pay each Agent a commission equal to the following
percentage of the principal amount of Securities or percentage of the aggregate
Dollar Equivalent of the Foreign Currency or Dollar Equivalent of the Currency
Unit (as defined in the Indenture) of the principal amount of Securities placed
by such Agent, as the case may be:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Term Commission Rate
- --------------------------------------------------------------------------------
<S> <C>
9 months to less than 1 year 0.125%
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1 year to less than 18 months 0.150%
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18 months to less than 2 years 0.200%
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2 years to less than 3 years 0.250%
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3 years to less than 4 years 0.350%
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4 years to less than 5 years 0.450%
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5 years to less than 7 years 0.500%
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7 years to less than 10 years 0.550%
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10 years to less than 15 years 0.625%
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15 years to less than 20 years 0.700%
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20 years to less than 30 years 0.750%
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30 years or more To be negotiated at time of sale
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</TABLE>
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EXHIBIT 2
EXECUTION COPY
U.S. $1,514,926,000
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
Medium-Term Notes, Series C
CALCULATION AGENT AGREEMENT
This AGREEMENT dated June 17, 1998, between National
Rural Utilities Cooperative Finance Corporation, a District of
Columbia cooperative association (hereinafter called the
"Issuer"), whose principal office is at Woodland Park, 2201
Cooperative Way, Herndon, Virginia 20171, and Lehman Brothers
Inc., a Delaware corporation (hereinafter sometimes called the
"Calculation Agent" which term shall, unless the context shall
otherwise require, include its successors and assignees),
whose principal office is at 3 World Financial Center, New
York, New York 10285-0900.
WHEREAS (A) The Issuer proposes to issue from time to time an
aggregate principal amount of up to $1,514,926,000 of Medium-Term Notes, Series
C (the "Notes") entitled to the benefits of the Indenture dated as of December
15, 1987 (as supplemented by the First Supplemental Indenture dated as of
October 1, 1990 and as it may be supplemented or amended from time to time, the
"Indenture"), between the Issuer and Harris Trust and Savings Bank, as successor
Trustee;
(B) Each Note will bear interest at either (a) a fixed rate or (b) a
floating rate determined by reference to an interest rate formula (the "Floating
Rate Notes");
NOW IT IS HEREBY AGREED THAT,
1. Terms defined in the "Description of Securities" and "Description
of the Medium-Term Notes" shall bear the same meanings herein unless the context
otherwise requires. The "Description of Securities" means the terms and
conditions of the Notes as set forth in the Prospectus, dated June 5, 1998, as
supplemented by a Prospectus Supplement, dated June 16, 1998, relating to the
Notes. The "Description of the Medium-Term Notes" means the terms and conditions
of the Notes as set forth in the Prospectus Supplement, dated June 16, 1998,
relating to the Notes. Such Prospectus Supplement will be supplemented or
amended by one or more Pricing Supplements (each a "Supplement") setting forth
additional terms and conditions of the Notes.
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2. The Issuer hereby appoints Lehman Brothers Inc. as Calculation
Agent for the Notes, upon the terms and subject to the conditions herein
mentioned, and Lehman Brothers Inc. hereby accepts such appointment. The
Calculation Agent shall act as an agent of the Issuer for the purpose of
determining the interest rate of the Floating Rate Notes in accordance with the
Description of the Medium-Term Notes and the provisions of this Agreement.
3. The Calculation Agent shall calculate the applicable interest
rates for the Floating Rate Notes in accordance with the provisions set forth in
the Prospectus Supplement relating to the Notes dated June 16, 1998, under the
heading "Description of Medium-Term Notes--Floating Rate Notes" which provisions
are incorporated by reference herein as if set forth in full in this Agreement.
4. In no event shall the interest rate be less than the floor, if
any, or more than the ceiling, if any, designated in the applicable Supplement.
5. The Calculation Agent will, as soon as practicable after (i) 3:00
p.m., New York City time, on the Calculation Date pertaining to each Interest
Determination Date relating to Commercial Paper Rate Notes, Fed Funds Rate
Notes, CD Rate Notes and Treasury Rate Notes or (ii) 11:00 a.m., London time, on
each Interest Determination Date relating to LIBOR Notes, determine (and notify
the Issuer and the Trustee of) the interest rate applicable during the next
succeeding interest period (if the interest rate cannot be determined in
accordance with the provisions set forth in the Prospectus Supplement relating
to the Notes dated June 16, 1998, in clause (i) under the heading "Description
of the Medium-Term Notes--Floating Rate Notes--LIBOR", the Calculation Agent
agrees to determine (and notify the Issuer and Trustee of) the interest rate in
accordance with the provisions in clause (ii) of such heading).
6. As soon as determined after each Interest Determination Date, the
Calculation Agent will cause to be forwarded to the Issuer, the Trustee and the
Paying Agent information regarding the interest rates and the interest periods
for each interest period and the relevant Interest Payment Date.
7. The Issuer will pay such compensation as shall be agreed upon and
the expenses, including reasonable counsel fees, properly incurred by the
Calculation Agent in connection with its duties hereunder, upon receipt of such
invoices as the Issuer shall reasonably require.
8. The Issuer will indemnify the Calculation Agent against any
losses, liabilities, costs, claims, actions or demands which it may incur or
sustain or which may be made against it in connection with its appointment or
the exercise of its powers and duties hereunder as well as the reasonable costs,
including the expenses and fees of counsel in defending any claim, action or
demand, except such as may result from the negligence, willful default or bad
faith of the Calculation Agent or any of its employees. The Calculation Agent
shall incur no liability and shall be indemnified and held harmless by the
Issuer for, or in respect of, any actions taken or suffered to be taken in good
faith by the Calculation Agent in reliance upon (i) the written opinion or
advice of counsel or (ii) written instructions from the Issuer.
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9. The Calculation Agent accepts its obligations herein (and agrees
to act in good faith in the performance of its obligations) set forth upon the
terms and conditions hereof, including the following, to all of which the Issuer
agrees:
(i) in acting under this Agreement and in connection with the Notes,
the Calculation Agent, acting as agent for the Issuer, does not assume any
obligation towards, or any relationship of agency or trust for or with,
any of the holders of the Notes;
(ii) unless herein otherwise specifically provided, any order,
certificate, notice, request or communication from the Issuer made or
given under any provision of this Agreement shall be sufficient if signed
by any person whom the Calculation Agent reasonably believes to be a duly
authorized officer of the Issuer;
(iii) the Calculation Agent shall be obligated to perform only such
duties as are set forth specifically herein and any duties necessarily
incidental thereto; and
(iv) the Calculation Agent shall be protected and shall incur no
liability for or in respect of any action taken or omitted to be taken by
it in reliance upon anything contained in a Floating Rate Note, the
Description of Securities, the Description of the Medium-Term Notes or one
or more Prospectus Supplements.
10. (A) The Issuer agrees to notify the Calculation Agent at least
five London Business Days prior to the issuance of any LIBOR Note. The
Calculation Agent agrees to select four Reference Banks prior to the issuance of
the first LIBOR Note by the Issuer; to make all appropriate arrangements for
such banks to act as Reference Banks; and to notify the Issuer, the Trustee and
each of the Agents as to the names and addresses of such Reference Banks. The
Calculation Agent covenants that, for so long as it is required so to do in
accordance with the applicable Description of the Medium-Term Notes it shall
ensure that there shall at all times be four Reference Banks. Forthwith upon any
change in the identity of the Reference Banks the Calculation Agent shall notify
the Issuer, the Trustee and the Agents of such change. If fewer than two
Reference Banks are quoting, the Calculation Agent agrees to select three major
banks in The City of New York in accordance with the applicable Description of
the Medium-Term Notes. The Calculation Agent shall not be responsible to the
Issuer or any third party for any failure of the Reference Banks to fulfill
their duties or meet their obligations as Reference Banks or as a result of the
Calculation Agent having acted (except in the event of negligence, willful
default or bad faith) on any certificate given by any Reference Bank which
subsequently may be found to be incorrect.
(B) If necessary, in accordance with the provisions set forth in the
Prospectus Supplement relating to the Notes dated June 16, 1998, under the
Heading "Description of the Medium-Term Notes--Floating Rate Notes--Prime Rate",
the Calculation Agent agrees to select a substitute major bank or trust company
(meeting the requirements specified under such heading). The Calculation Agent
shall not be responsible to the Issuer or any third party for the failure of
such bank or trust company to fulfill any duty or obligation contemplated under
such heading.
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(C) Except as provided below, the Calculation Agent may at any time
resign as Calculation Agent by giving written notice to the Issuer and the
Trustee of such intention on its part, specifying the date on which its desired
resignation shall become effective, provided that such notice shall be given not
less than two months prior to the said effective date unless the Issuer and the
Trustee otherwise agree in writing. Except as provided below, the Calculation
Agent may be removed by the filing with it of an instrument in writing signed by
the Issuer specifying such removal and the date when it shall become effective
(such effective date being at least 20 days after said filing). Such resignation
or removal shall take effect upon:
(i) the appointment by the Issuer as hereinafter provided of a
successor Calculation Agent approved by the Trustee, which shall be a
responsible financial firm or institution having an established place of
business in The City of New York;
(ii) the acceptance of such appointment by such successor
Calculation Agent; and
(iii) the giving of notice of such appointment to the holders of the
Notes, provided that if the Calculation Agent fails duly to establish the
amount of interest for any interest period, such removal will take effect
immediately upon such appointment of, and acceptance thereof by, a
successor Calculation Agent approved by the Trustee and qualified as
aforesaid, in which event notice of such appointment shall be given to the
holders of the Notes as soon as practicable thereafter. Upon its
resignation or removal becoming effective, the retiring Calculation Agent
shall be entitled to the payment of its compensation and the reimbursement
of all expenses incurred by such retiring Calculation Agent pursuant to
paragraph 7 hereof.
(D) If at any time the Calculation Agent shall resign or be removed,
or shall become incapable of acting or shall be adjudged bankrupt or insolvent,
or liquidated or dissolved, or an order is made or an effective resolution is
passed to wind up the Calculation Agent, or if the Calculation Agent shall file
a voluntary petition in bankruptcy or make an assignment for the benefit of its
creditors, or shall consent to the appointment of a receiver, administrator or
other similar official of all or any substantial part of its property, or shall
admit in writing its inability to pay or meet its debts as they mature, or if a
receiver, administrator or other similar official of the Calculation Agent or of
all or any substantial part of its property shall be appointed, or if any order
of any court shall be entered approving any petition filed by or against the
Calculation Agent under the provisions of any applicable bankruptcy or
insolvency law, or if any public officer shall take charge or control of the
Calculation Agent or its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then a successor Calculation Agent, approved by the
Trustee, shall be appointed by the Issuer by an instrument in writing filed with
the successor Calculation Agent. Upon the appointment as aforesaid of a
successor Calculation Agent and acceptance by the latter of such appointment and
(except in cases of removal for failure to establish the amount of interest) the
giving of notice to the holders of the Notes, the former Calculation Agent shall
cease to be Calculation Agent hereunder.
(E) Any successor Calculation Agent appointed hereunder shall
execute and deliver to its predecessor and the Issuer an instrument, in the form
acceptable to the Trustee,
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accepting such appointment hereunder, and thereupon such successor Calculation
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trusts, immunities, duties and obligations of
such predecessor with like effect as if originally named as the Calculation
Agent hereunder, and such predecessor shall thereupon become obliged to transfer
and deliver, and such successor Calculation Agent shall be entitled to receive,
copies of any relevant records maintained by such predecessor Calculation Agent.
(F) Any corporation into which the Calculation Agent may be merged
or converted or any corporation with which the Calculation Agent may be
consolidated or any corporation resulting from any merger, conversion or
consolidation to which the Calculation Agent shall be a party shall, to the
extent permitted by applicable law and provided that it shall be a responsible
financial firm or institution having an established place of business in The
City of New York, be the successor Calculation Agent under this Agreement
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. Notice of any such merger, conversion or
consolidation shall forthwith be given to the Issuer and the Trustee.
11. Any notice required to be given hereunder shall be delivered in
person, sent by letter or telex or communicated by telephone (subject, in the
case of communication by telephone, to confirmation dispatched within two
business days by letter or telex), in the case of the Issuer, to it at Woodland
Park, 2201 Cooperative Way, Herndon, Virginia 20171, Attention: Chief Financial
Officer; in the case of the Calculation Agent, to it at 3 World Financial
Center, New York, New York 10285, Attention: Medium-Term Note Department; and in
the case of the Trustee, to it [c/o Bank of Montreal Trust Company, 77 Water
Street, 4th Floor, New York, New York 10005,] Attention: Corporate Trustee
Administration Department or, in any case, to any other address of which the
party receiving notice shall have notified the party giving such notice in
writing.
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12. This Agreement may be amended only by a writing duly executed
and delivered by each of the parties signing below.
13. The provisions of this Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
14. This Agreement may be executed in counterparts and the executed
counterparts shall together constitute a single instrument.
IN WITNESS WHEREOF, this Agreement has been executed and delivered
as of the day and year first above written.
NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION,
by
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LEHMAN BROTHERS INC.,
by
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