<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 33-14490
_________________
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987-A6
(Exact name of registrant as specified in its charter)
NEW YORK
(State or other jurisdiction of incorporation or organization)
36-6854526
(I.R.S. Employer Identification Number)
2201 Cooperative Way, Herndon, VA 20171-3025
(Address of principal executive offices)
(Registrant's telephone number, including area code, is 703-709-6700)
___________________
Securities Registered pursuant to Section 12(b) of the Act: None.
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
The Registrant has no common or voting stock.
DOCUMENTS INCORPORATED BY REFERENCE:
1. Form of Trust Agreement
2. Loan Agreement
3. Loan Guarantee and Servicing Agreement
Exhibit Index located on page 13.
<PAGE> 2
Part I
Item 3. Legal Proceedings
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
<PAGE> 3
Part II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
a) There is no established trading market for the
certificates representing ownership of the
beneficial interest in the Trust.
b) As of March 28, 1997 there were two holders of
certificates representing ownership of the
beneficial interest in the Trust.
Item 8. Financial Statements and Supplementary Data
See attached audited financial statements.
Item 9. Disagreements on Accounting and Financial Disclosure
None.
Part III
Item 13. Certain Relationships and Related Transactions
None.
<PAGE> 4
Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports
on Form 8-K
a) The following documents are filed as part of this report:
1. Financial Statements
Report of Independent Public Accountants
Statements of Assets and Liabilities as of
December 31, 1996 and 1995
Statements of Income and Expenses, for the
Years Ended December 31, 1996, 1995 and 1994
Statements of Cash Flows, for the Years Ended
December 31, 1996, 1995 and 1994
Notes to Financial Statements
2. Financial Statement Schedules are omitted
because they are inapplicable.
3. Exhibits
Exhibit
Number Description of Exhibit
4.1 Form of Trust Agreement,
including the form of Rural
Electric Cooperative Grantor
Trust Certificate
(incorporated by reference
to Form 10-K for the fiscal
year ended December 31, 1987).
10.1 Loan Agreement (incorporated
by reference to Exhibit 10.1
to Registration Statement on
Form S-1 [No. 33-14490]).
10.2 Loan Guarantee and Servicing
Agreement (incorporated by
reference to Exhibit 10.2 to
Registration Statement on Form
S-1 [No. 33-14490]).
b) Form 8-K dated September 30, 1996.
Semi-annual Report to Certificateholders dated
September 30, 1996.
Supplemental information to be furnished with reports filed pursuant to
Section 15(d) of the Act by Registrants which have not registered securities
pursuant to Section 12 of the Act.
No annual report, proxy statement, form of proxy or other proxy
soliciting material has been sent to Certificateholders, and the
Registrant does not presently contemplate sending any such material
subsequent to the filing of this report.
<PAGE> 5
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly
authorized, in the County of Fairfax, Commonwealth of Virginia on
the 28th day of March, 1997.
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987 A-6
By: NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION as Servicer
By: /s/ Sheldon C. Petersen
Sheldon C. Petersen, Governor and
Chief Executive Officer
<PAGE> 6
RURAL ELECTRIC COOPERATIVE GRANTOR
TRUST (SOYLAND) 1987-A6
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1996 AND 1995
AND FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
TOGETHER WITH AUDITORS' REPORT
<PAGE> 7
Report of Independent Public Accountants
To the Trustee of
Rural Electric Cooperative Grantor Trust
(Soyland) 1987-A6, and
To the Board of Directors of
National Rural Utilities Cooperative
Finance Corporation:
We have audited the accompanying statements of assets and liabilities of
Rural Electric Cooperative Grantor Trust (Soyland) 1987-A6 as of December
31, 1996 and 1995, and the related statements of income and expenses and
cash flows for each of the three years in the period ended December 31,
1996. These financial statements are the responsibility of the Trust's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform an audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluatin
g the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Rural Electric
Cooperative Grantor Trust (Soyland) 1987-A6 as of December 31, 1996 and
1995, and the results of its operations and its cash flows for the years
ended December 31, 1996, 1995 and 1994, in conformity with generally
accepted accounting principles.
March 24, 1997
Washington, D. C.
<PAGE> 8
<TABLE>
<CAPTION>
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987-A6
STATEMENTS OF ASSETS AND LIABILITIES
AS OF DECEMBER 31, 1996 AND 1995
_____________________________________________________________________
1996 1995
<S> <C> <C>
ASSETS
Interest Receivable $2,826,420 $2,826,420
Note Receivable 102,000,000 102,000,000
Total Assets $104,826,420 $104,826,420
LIABILITIES
Interest Payable-
Grantor Trust Certificates $2,803,300 $2,803,300
Servicer Fees Payable 23,120 23,120
Rural Electric Cooperative
Grantor Trust Certificates 102,000,000 102,000,000
Total Liabilities $104,826,420 $104,826,420
</TABLE>
The accompanying notes are an integral part
of these financial statements
<PAGE> 9
<TABLE>
<CAPTION>
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987-A6
STATEMENTS OF INCOME AND EXPENSES
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994
_____________________________________________________________________
1996 1995 1994
<S> <C> <C> <C>
INCOME:
Interest on note receivable $9,975,600 $9,975,600 $9,975,600
EXPENSES:
Interest on
grantor trust certificates 9,894,000 9,894,000 9,894,000
Servicer fees 81,600 81,600 81,600
Total Expenses 9,975,600 9,975,600 9,975,600
Net Income $ - $ - $ -
</TABLE>
<PAGE> 10
<TABLE>
<CAPTION>
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987-A6
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994
_____________________________________________________________________
1996 1995 1994
<S> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES:
Interest received on
note receivable $9,975,600 $9,975,600 $9,975,600
Interest paid to
Certificateholders (9,894,000) (9,894,000) (9,894,000)
Fees paid to Servicer ( 81,600) (81,600) (81,600)
Net cash provided by
operating activities - - -
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from principal
payment on note - - -
Net cash provided from
investing activities - - -
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payment to
Certificateholders - - -
Net cash used in
financing activities - - -
NET CHANGE IN CASH - - -
CASH, beginning of year - - -
CASH, end of year $ - $ - $ -
ACCRUAL TO CASH BASIS RECONCILIATION:
Accrual basis income $ - $ - $ -
Change in accrual accounts:
Decrease in interest
receivable - - 5,780
Decrease in servicer
fees payable - - (5,780) -
Total change in
accrual accounts - - -
Net cash provided by
operating activities $ - $ - $ -
</TABLE>
The accompanying notes are an integral part
of these financial statements
<PAGE> 11
RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (SOYLAND) 1987-A6
NOTES TO FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1996, 1995 AND 1994
1. ORGANIZATION AND OPERATIONS
Rural Electric Cooperative Grantor Trust (Soyland) 1987-A6 (the
"Trust") was formed under a Trust Agreement dated March 19, 1987
among National Rural Utilities Cooperative Finance Corporation
("CFC"), Soyland Power Cooperative, Inc. (the "Cooperative") and
The First National Bank of Chicago (the "Trustee"). On that date,
CFC made a loan to the Cooperative which issued a note (the "Note"),
evidencing the borrowing, to the Trust. The Trust issued to CFC
Rural Electric Cooperative Grantor Trust (Soyland) 9.70%
Certificates Due 2017 (the "Certificates") in the amount of
$102,000,000. The Certificates are solely the obligations of the
Trust and are not insured or guaranteed by CFC, the Cooperative,
the Trustee, the Rural Utilities Service ("RUS") of the United
States Department of Agriculture ("USDA") nor any other
governmental agency. Each Certificate represents an undivided
fractional interest in the Trust. CFC is the depositor of the
Trust and acts as Servicer of the Note. CFC filed, on behalf of
the Trust, a Registration Statement on Form S-1 (Registration No.
33-14490) which became effective on July 15, 1987, and CFC resold
the Certificates thereunder.
The assets of the Trust consist primarily of the Note, bearing
interest at 9.78% and maturing 2017, which is guaranteed (the
"Guarantee") as to timely payment of principal and interest by
the United States of America, acting through the Administrator
of RUS. The amounts of principal and interest payments on the
Note held by the Trust are sufficient to cover the scheduled
principal and interest payments on the Certificates issued by the
Trust and the scheduled amounts of servicer fees. The General
Counsel of the USDA has issued an opinion that the Guarantee is
supported by the full faith and credit of the United States of
America.
Debt service and servicer fee payments on the Note are made to the
Trustee semi-annually (March 19 and September 19) by the Cooperative.
The Trustee deposits all such receipts in the Trust account. The
Trustee is authorized by the Trust Agreement to invest all funds in
the Trust account at the direction of CFC in certain eligible
investments that mature no later than the business day next preceding
the day (March 30 and September 30) such amounts are to be distributed
to the Certificateholders and the Servicer. The interest earned on
the investments is distributed to the Cooperative. Any funds that
are not so invested must be held by the Trustee in the Trust account.
The Trustee may not reinvest any returns of principal or investment
earnings on eligible investments and the Trustee may not sell any
eligible investment prior to its maturity except, at the direction
of CFC, to preserve the value of the corpus of the Trust.
On or before five business days after each date on which payments
are made on the Certificates, the Trustee is obligated to supply
the holders of such Certificates a report provided by the Servicer,
which includes certain pertinent information as to how the payment
is to be allocated to principal, interest, servicer fees and premium,
if any, as well as the principal balance outstanding after such
payment.
The fiscal year of the Trust is the calendar year. Within the
prescribed period of time for tax reporting purposes, after the
end of each calendar year during the term of the Trust Agreement,
the Trustee is obligated to prepare and mail to each
Certificateholder of record for the Trust, at any time during such
year, a report setting forth the information as is reasonably
necessary for the preparation of such Certificateholder's Federal
income tax return.
<PAGE> 12
The Certificates are not subject to redemption prior to March 20,
1997. On February 14, 1997, RUS gave irrevocable notice that they
will prepay the principal amount of $102,000,000. On March 20,
1997, such prepayment was made. The Trust Agreement was terminated
after payment in full was made on the Certificates issued thereunder.
2. TAX STATUS OF THE TRUST
Milbank, Tweed, Hadley & McCloy, counsel to CFC, has advised CFC
with respect to the Trust that, in its opinion, (i) the Trust will
not be classified as an association taxable as a corporation, but
will be classified as a grantor trust and (ii) each Certificateholder
will be treated for Federal income tax purposes as the owner of an
undivided fractional interest in each of the assets held by the
Trust.
It is expected that the Trust will not have any liability for
Federal or state income taxes for the current or future years.
3. INTEREST AND SERVICER FEE ACCOUNTING
The Trust records interest income as it is earned and accrues
interest expense and servicer fees as they are incurred.
Servicer fees represent eight basis points of the outstanding
principal balance of the Certificates and the Note.
4. FAIR VALUE OF FINANCIAL INSTRUMENTS
Use Of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and
the reported amounts of expenses during the reported period. The
estimates involve judgments with respect to, among other things,
various future factors which are difficult to predict and are beyond
the control of the Trust. With regards to the fair values below,
actual amounts could differ from these estimates.
The following disclosure of the estimated fair value of financial
instruments is made in accordance with FASB Statement No. 107,
"Disclosure about Fair Value of Financial Instruments." Whenever
possible, the estimated fair value amounts have been determined
using quoted market information as of December 31, 1996 and 1995,
along with other valuation methodologies which are summarized below.
Below is a summary of significant methodologies used in estimating
fair value amounts and a schedule of fair values at December 31,
1996 and 1995.
The carrying amounts reported for Interest Receivable, Interest
Payable - Grantor Trust Certificates, and Servicer Fees Payable
approximate fair values due to the short term maturity of these
instruments.
<PAGE> 13
Note Receivable
Fair value is estimated by discounting the future cash flows using the
current rates at which similar loans would be made to borrowers with similar
credit ratings and for the same remaining maturities.
Rural Electric Cooperative Grantor Trust Certificates
The fair value of the Certificates is estimated using quoted market prices
for similar notes over the same remaining maturities.
The carrying and estimated fair values of the Trust's financial instruments
as of December 31, 1996 and 1995, are as follows:
<TABLE>
<CAPTION>
1996 1995
Carrying Fair Carrying Fair
Value Value Value Value
<S> <C> <C> <C> <C>
Assets:
Interest Receivable 2,826,420 2,826,420 2,826,420 2,826,420
Note Receivable 102,000,000 131,767,850 102,000,000 140,489,279
Liabilities:
Interest Payable - Grantor
Trust Certificates 2,803,300 2,803,300 2,803,300 2,803,300
Servicer Fees Payable 23,120 23,120 23,120 23,120
Rural Electric Cooperative
Grantor Trust Certificates 102,000,000 131,958,497 102,000,000 140,750,151
</TABLE>
<PAGE> 14
Exhibit Index
Exhibit
Number Description of Exhibit
4.1 Form of Trust Agreement, including the form of Rural Electric
Cooperative Grantor Trust Certificate (incorporated by
reference to Form 10-K for the fiscal year ended December
31, 1987).
10.1 Loan Agreement (incorporated by reference to Exhibit 10.1 to
Registration Statement on Form S-1 [No. 33-14490]).
10.2 Loan Guarantee and Servicing Agreement (incorporated by
reference to Exhibit 10.2 to Registration Statement on Form
S-1 [No. 33-14490]).
<end>
