As filed with the Securities and Exchange Commission on May 15, 1995 _______________________________________________________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________ FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1995. Commission File Number 0-17440 FEDERAL AGRICULTURAL MORTGAGE CORPORATION (Exact name of registrant as specified in its charter) Federally chartered instrumentality of the United States 52-1578738 _______________________________ ______________________________ (State or other jurisdiction (I.R.S. employer identification of incorporation or organization) number) 919 18th Street, N.W., Suite 200, Washington, D.C. 20006 _________________________________ _____________________________ (Address of principal executive (Zip code) offices) (202) 872-7700 (Registrant's telephone number, including area code) ____________________________________________________ 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 twelve months (or 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the last practicable date. As of May 15, 1995, there were 670,000 shares of Class A Voting Common Stock, 500,301 shares of Class B Voting Common Stock, and 1,170,301 shares of Class C Non-Voting Common Stock outstanding.
PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements The following interim consolidated financial statements of the Federal Agricultural Mortgage Corporation (the "Corporation" or "Farmer Mac") have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Such interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted as permitted by such rules and regulations. Management believes that the disclosures are adequate to present fairly the consolidated financial position, consolidated results of operations and consolidated cash flows at the dates and for the periods presented. These condensed financial statements should be read in conjunction with the audited 1994 financial statements of Farmer Mac. Results for interim periods are not necessarily indicative of those to be expected for the fiscal year. The following information concerning Farmer Mac's financial statements as of March 31, 1995, December 31, 1994 and March 31, 1994 is included herein. Consolidated Balance Sheets..........................3 Consolidated Statements of Operations................4 Consolidated Statements of Cash Flows................5
<TABLE> <CAPTION> FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED BALANCE SHEETS (Dollars in Thousands) March 31, 1995 December 31, 1994 (unaudited) <S> <C> <C> ASSETS: Cash and cash equivalents.. $ 637 $ 200 Interest receivable.......... 8,862 14,023 Guarantee fees receivable 330 454 Mortgage payments receivable. 4,732 1,196 Investments, net ............ 86,870 78,218 Mortgage portfolio, net ..... 378,048 382,833 Office equipment, net ....... 89 98 Prepaid expenses and other assets.................... 309 216 TOTAL ASSETS....... $479,877 $ 477,238 </TABLE> <TABLE> <CAPTION> LIABILITIES AND STOCKHOLDERS' EQUITY: LIABILITIES: <S> <C> <C> Allowance for mortgage- backed securities sold... $ 93 $ 81 Accounts payable and accrued expenses................ 929 972 Accrued interest payable on Medium-Term Notes.... 6,855 7,450 Debentures, notes and bonds, net: Due within one year.... 189,454 168,307 Due after one year..... 270,634 288,209 TOTAL LIABILITIES.... 467,965 465,019 STOCKHOLDERS' EQUITY: Common stock: Class A Voting, $1 par value, no maximum authorization, 670,000 shares issued and outstanding.............. 670 670 Class B Voting, $1 par value, no maximum authorization, 500,301 shares issued and outstanding............. 500 500 </TABLE>
<TABLE> <CAPTION> FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED BALANCE SHEETS (Dollars in Thousands) (Continued) March 31, 1995 December 31, 1994 (unaudited) <S> <C> <C> Class C Non-Voting, $1 par value, no maximum authorization, 1,170,301 shares issued and outstanding............ 1,170 1,170 Additional paid in capital................ 19,331 19,331 Accumulated deficit..... (9,759) (9,452) TOTAL STOCKHOLDERS' EQUITY........... 11,912 12,219 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........ $ 479,877 $ 477,238 </TABLE> See accompanying notes to consolidated financial statements. <TABLE> <CAPTION> FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands, Except Per Share Amounts) Three Months Ended March 31, 1995 March 31,1994 (unaudited) (unaudited) INTEREST INCOME: <S> <C> <C> Investments and cash equivalents....$ 1,220 $ 1,171 Mortgage portfolio.... 6,810 6,625 TOTAL INTEREST INCOME.. 8,030 7,796 INTEREST EXPENSE....... 7,763 7,637 NET INTEREST INCOME... 267 159 OTHER INCOME: Guarantee fees......... 307 267 Miscellaneous 17 57 TOTAL OTHER INCOME.... 324 324 OTHER EXPENSES: Compensation and employee benefits..... 465 452 Professional fees...... 85 95 Insurance.............. 57 35 Rent................... 42 40 Regulatory fees........ 92 70 Board of Directors fees and meeting expenses............. 78 72 Administrative......... 79 96 TOTAL OTHER EXPENSES.. 898 860 NET LOSS................. $ (307) $ (377) NET LOSS PER SHARE....... $ (0.13) $ (0.16) </TABLE> See accompanying notes to consolidated financial statements.
<TABLE> <CAPTION> FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands) Three Months Ended March 31, 1995 March 31, 1994 (unaudited) (unaudited) _____________ ______________ CASH FLOWS FROM OPERATING ACTIVITIES: <S> <C> <C> Loss from Operations........ $ (307) $ (377) Adjustments to reconcile loss to net cash provided by operating activities: Amortization of premium on mortgage portfolio..... 1,719 1,737 Depreciation and amortization............. 429 275 Decrease in guarantee fees receivable.......... 124 309 Decrease in interest receivable................ 5,161 6,548 Increase in mortgage payments receivable....... (3,536) (4,413) Increase in prepaid expenses and other assets.................... (93) (27) Amortization of debt issuance costs............ 50 79 (Decrease) increase in accounts payable and accrued expenses.......... (43) 274 Decrease in accrued interest payable on medium term notes......... (595) (580) Provision for losses on Farmer Mac I Program...... 29 25 Net cash provided by operating activities...... 2,938 3,850 CASH FLOWS FROM INVESTING ACTIVITIES: Motgage purchases.......... (15,106) (12,991) Purchases of investments... (223,905) (111,593) Proceeds from maturity of investments............ 216,218 91,500 Proceeds from mortgage principal repayments...... 18,465 29,351 Purchases of office equipment................. (2) (4) </TABLE>
<TABLE> <CAPTION> FEDERAL AGRICULTURAL MORTGAGE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands) (Continued) Three Months Ended March 31, 1995 March 31, 1994 (unaudited) (unaudited) _____________ ______________ <S> <C> <C> Net cash (used) provided by investing activities... (4,330) (3,737) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of Medium-Term Notes..... 9,989 - Payments to redeem Medium-Term Notes........ (7,185) 13,020) Proceeds from issuance of Discount Notes........ 306,525 134,028 Discount notes redeemed... (307,500) (122,000) Net cash provided (used) by financing activities.. 1,829 (992) Net increase (decrease) in cash and cash equivalents.............. 437 (879) Cash and cash equivalents at beginning of period... 200 1,081 Cash and cash equivalents at end of period......... $ 637 $ 202 Supplemental disclosures of cash flow information: Cash paid during the three-month period for: Interest.......... $ 6,577 $ 7,285 </TABLE> See accompanying notes to consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. ACCOUNTING POLICIES (a) Principles of Consolidation Financial information at and for the three months ended March 31, 1995 is consolidated to include the accounts of Farmer Mac and its two wholly owned subsidiaries, Farmer Mac Mortgage Securities Corporation and Farmer Mac Acceptance Corporation. All material intercompany transactions have been eliminated in consolidation. (b) Reclassifications Certain reclassifications of the 1994 information were made to conform with the 1995 presentation. NOTE 2. OFF-BALANCE SHEET FARMER MAC GUARANTEED SECURITIES Farmer Mac is a party to transactions involving financial instruments with off-balance sheet risk. These transactions include guarantees by Farmer Mac of securities not held in its portfolio. Farmer Mac issues guarantees in the normal course of business to fulfill its statutory purpose of increasing liquidity for agricultural mortgage lenders. Farmer Mac guarantees the timely payment of principal and interest on securities issued under the Farmer Mac I and Farmer Mac II Programs. The following table sets forth the outstanding principal balances of Farmer Mac Guaranteed Securities issued under the Farmer Mac I and Farmer Mac II Programs and not held in its portfolio. <TABLE> <CAPTION> March 31, 1995 March 31, 1994 (In Thousands) <S> <C> <C> Farmer Mac I......... $ 148,802 $ 84,407 Farmer Mac II........ $ 5,187 $ 7,902 </TABLE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations LIQUIDITY AND CAPITAL RESOURCES Farmer Mac's primary sources of liquidity are issuances of debt obligations, and principal and interest payments received on mortgages underlying securities purchased by Farmer Mac under the Farmer Mac I and Farmer Mac II Programs. Farmer Mac's Board has authorized the issuance of up to $1.5 billion of Discount Notes and Medium-Term Notes. Funds from the borrowings may be used in the Farmer Mac I and Farmer Mac II Programs to cover transaction costs, guarantee payments and the costs of purchasing Farmer Mac Guaranteed Securities and Guaranteed Portions issued in the Farmer Mac I and Farmer Mac II Programs and to retire existing Notes. Funds from the borrowings also may be used for liquidity purposes. At March 31, 1995, Farmer Mac had 460.1 million of Discount Notes and Medium-Term Notes (net of unamortized debt issuance costs, discounts and premiums) outstanding, a $3.6 million increase from December 31, 1994. During the first three months of 1995, Farmer Mac issued $308.5 million of Discount Notes and $10 million of Medium- Term Notes and redeemed $307.5 million of Discount Notes and $ 7.2 million of Medium-Term Notes. The $8.7 million increase in investments from December 31, 1994 to March 31, 1995 resulted from the increase in the liquidity portfolio, comprised of short-term commercial paper and U.S. agency securities. The $4.8 million reduction in the mortgage portfolio largely resulted from principal and interest payments received on the mortgage- backed securities issued under the Corporation's Linked Portfolio Strategy, net of the acquisition of Farmer Mac Guaranteed Portions purchased under the Farmer Mac II Program. Proceeds of any future Note issuances are expected to be used by the Corporation primarily to fund purchases of Farmer Mac Guaranteed Securities and Guaranteed Portions under the Farmer Mac I and Farmer Mac II Programs and to maintain Farmer Mac's liquidity position. At March 31, 1995, Farmer Mac's total loss allowance was $322 thousand. The mortgage portfolio is shown net of its applicable allowance of $229 thousand at March 31, 1995, representing an increase of $16 thousand from year-end 1994; the allowance for Farmer Mac Guaranteed Securities not held by Farmer Mac was $93 thousand at March 31, 1995, representing an increase of $12 thousand from year-end 1994. Future additions to this allowance will be charged to earnings and the amounts in the allowance account will be used to cover payments of claims under Farmer Mac guarantees. Farmer Mac considers the amounts in the allowance account to be adequate to cover its exposure' to guarantee payments in the Farmer Mac I Program. Before Farmer Mac is required to make a guarantee payment on Farmer Mac I Securities, full recourse must be taken against a reserve or subordinated interest initially established in an amount equal to at least ten percent (10%) of the initial pool balance. At March 31, 1995, a total of three loans aggregating $400 thousand were 90 days or more past due, two loans totaling $300 thousand were in foreclosure and title to one loan with an outstanding principal balance of $613 thousand had been acquired by the trust in the Farmer Mac I Program. The six loans combined represent 0.4% of the aggregate principal amount of outstanding Farmer Mac I Securities at March 31, 1995. Management believes that no losses will be incurred by Farmer Mac as a result of the loans in foreclosure or the real estate owned by the trust. No loss allowance has been made specifically for the Farmer Mac II Program because the Guaranteed Portions are backed by the full faith and credit of the United States and are not exposed to credit losses. At March 31, 1995, Farmer Mac's regulatory required minimum capital was $5.5 million and its actual capital level was $11.9 million. At December 31, 1994, Farmer Mac's regulatory required minimum capital was $4.8 million, and its actual capital level was $12.2 million. Beginning in December 1996, higher statutory minimum capital requirements are scheduled to become effective, significantly increasing the required amount of Farmer Mac's regulatory capital. If those requirements had been in effect at March 31, 1995, Farmer Mac's actual capital would have been $790 thousand less than the total minimum capital required. As previously reported, the Board has authorized and management is actively pursuing a legislative initiative to revise the Farmer Mac charter. That initiative, if successful, would, among other things, delay beyond 1996 the implementation of the higher regulatory capital requirements. Although draft legislation has been submitted to various Congressional Committees that have jurisdiction over Farmer Mac, no specific bill has been introduced in Congress. There can be no assurance that any such legislation, if introduced, will be enacted by Congress, or that, if enacted, such legislation will include any or all of the revisions Farmer Mac seeks and not include revisions adverse to Farmer Mac's business. In addition,there can be no assurance that, if legislation is enacted, the volume of any business generated under a revised charter will result in profitability for Farmer Mac or that Farmer Mac will be able to raise capital, either from retained earnings or from external financing sources, such as an offering of common or preferred stock, sufficient to allow Farmer Mac to comply with future capital requirements. If Farmer Mac were unable to satisfy the higher capital requirements, whenever they became effective, the Director of the Office of Secondary Market Oversight, Farmer Mac's regulator, would be required to take the mandatory supervisory measures and authorized to take the optional supervisory measures previously reported, depending upon the capital level in which Farmer Mac is then classified. The imposition of supervisory measures could have a material adverse impact on Farmer Mac's results of operations and its ability to raise capital, borrow or engage in transactions with third parties; thus, such measures could, in effect, preclude Farmer Mac from complying with higher capital standards. Ultimately, if a conservator were to be appointed for Farmer Mac, stockholders could lose some or all of the value of their equity investment in Farmer Mac, and creditors could experience a reduced level of recovery on their claims. In the opinion of management, Farmer Mac has sufficient liquidity and capital for the next twelve months. RESULTS OF OPERATIONS General. Farmer Mac reported a net loss for the three months ended March 31, 1995 of $307 thousand, a decrease of $70 thousand from the $377 thousand loss reported for the three months ended March 31, 1994. The decrease in loss is attributable to an increase in net interest income, largely a result of increased yield maintenance income above the accelerated level of premium amortization for the three months ended March 31, 1995 as compared to the three months ended March 31, 1994. A number of factors have constrained participation in Farmer Mac's programs, and caused its core business activities to be unprofitable. Those factors include: the excess liquidity of many agricultural lenders; the attractiveness of loans (otherwise qualified under the Farmer Mac programs) as investments; the disinclination of lenders to offer, and the lack of borrower demand for, long- term, fixed rate agricultural real estate loans as a result of the higher profitability associated with short-term lending; Farmer Mac's inability to control the pooling process, particularly, the pooler's mix of loan products and rates, marketing activities, and loan securitization decisions; and the unfavorable capital treatment afforded banks and Farm Credit institutions holding subordinated securities created in Farmer Mac transactions. Improvements in Farmer Mac's operating results will depend upon the volume of new guarantee transactions. While the Agricultural Real Estate and Farmer Mac II Programs have generated interest income and guarantee fee income, the volume of guarantee transactions has not been sufficient to generate income in excess of operating expenses, which has required Farmer Mac to continue to use its capital to fund operations. The use of capital to fund operations has continued to reduce Farmer Mac's stockholders' equity, which has decreased $307 thousand from December 31, 1994 to March 31, 1995. With regard to the Prudential Securities/Equitable Agri-Business open window program, Farmer Mac has been informed by Equitable that it continues to have discussions with prospective institutions regarding the continuation of that program following the withdrawal of Prudential as pooler, but that it has not yet contracted with one. The final transaction under that program is expected to close in the second quarter of 1995. Following that transaction, Prudential will no longer be a pooler in the Farmer Mac program. With regard to the joint Fannie Mae, AgFirst (formerly, the Farm Credit Bank of Columbia) and Farmer Mac rural housing initiative, the parties are continuing to finalize the legal documentation necessary to implement the program, which is now scheduled to commence operations on August 1, 1995. The Western Farm Credit Bank, in accordance with the terms of its strategic alliance with Farmer Mac, is in the process of finalizing the program documentation for its open window program and commencing the formation of its nationwide network of originators and sellers. Western anticipates the program to be operational during the second quarter of 1995. While management believes that each of these programs, if continued or commenced, as the case may be, will be successful, there is no assurance that they will generate sufficient volume to result in any Farmer Mac guarantee transactions. Farmer Mac's future profitability will be affected not only by guarantee volume but also by any payments Farmer Mac must make on its guarantees; payments it must make on its Notes; the income it earns on its investment securities, its mortgage portfolio and other funds it is holding; and its administrative expenses. Losses, if any, on guarantees will be affected by many circumstances, including agricultural growing conditions, agricultural market conditions, changes in government agricultural support policies and the general economy. The primary sources of funding for the payment of claims made under guarantees are the fees Farmer Mac charges for providing its guarantees, together with Farmer Mac's loss allowance, invested capital and the proceeds of any other debt issuances. Even if Farmer Mac's legislative initiative is successful and Congress revises the Farmer Mac charter, Farmer Mac's future will still be dependent upon continued, more effective and significantly increased utilization of its programs by its Class A and Class B stockholders. Average Balances, Income and Expense, Yields and Rates. The following table presents, for the periods indicated, information regarding interest income on average interest earning assets and related yields, as well as interest expense on average interest bearing liabilities and related rates paid. The average balances were calculated by averaging month-end balances. <TABLE> <CAPTION> Three Months Ended March 31, 1995 1994 (Dollars in Thousands) Average Income/ Average Average Income/ Average Balances Expense Rate Balances Expense Rate Assets <S> <C> <C> <C> <C> <C> <C> Earning assets: Mortgage-backed securities $ 377,416 $ 6,810 7.22% $ 396,719 $ 6,625 6.68% Investments and cash equivalents 86,570 1,220 5.64% 107,790 1,171 4.34% Total earning assets 463,986 8,030 6.92% 504,509 7,796 6.18% Other assets 11,220 11,502 $ 475,206 $ 516,011 Liabilities and Stockholders' Equity Interest-bearing liabilities Debentures, notes and bonds, net $ 456,572 $ 7,763 6.80% $ 495,424 $ 7,637 6.17% Other liabilities 6,594 7,062 Stockholders' equity 12,040 13,525 $ 475,206 $ 516,011 Net interest income/spread $ 267 0.12% $ 159 0.01% Net yield on interest earning assets 0.23% 0.13% </TABLE>
Rate/Volume Analysis. The table below sets forth certain information regarding the changes in the components of Farmer Mac's net interest income for the periods indicated. For each category, information is provided on changes attributable to (a) changes in volume (change in volume multiplied by old rate); (b) changes in rate (change in rate multiplied by old volume); and (c) the total. Combined rate/volume variances, a third element of the calculation, are allocated based on their relative size. <TABLE> <CAPTION> Three Months Ended March 31, 1995 Compared to Three Months Ended March 31, 1994 Increase or (Decrease) Due to Rate Volume Total (in thousands) <S> <C> <C> <C> Income from interest-earning assets: Mortgage Portfolio $ 468 $ (283) $ 185 Investments 146 (97) 49 Total income from interest-earning assets 614 (380) 234 Expense on interest-bearing liabilities 528 (402) 126 Change in net interest income $ 86 $ 22 $ 108 </TABLE> PERIOD ENDED MARCH 31, 1995 COMPARED TO PERIOD ENDED MARCH 31, 1994 Net Interest Income. Net interest income totaled $267 thousand for the three months ended March 31, 1995, a $108 thousand increase from the three months ended March 31, 1994. The increase in net interest income is the result of the 11 basis point (0.11%) increase in the net interest spread, largely a result of an increase in yield maintenance income above the accelerated level of premium amortization for March 31, 1995 as compared to March 31, 1994. Interest Income. Interest income totaled $8.0 million and $7.8 million for the three months ended March 31, 1995 and 1994, respectively. The $234 thousand increase is attributable to the increase in the average rate of interest-earning assets which more than offset the decline in the average balances of interest-earning assets. The increase in the average rate of interest-earning assets is attributable to the overall increase in the rate of Guaranteed Portions and Securities issued under the Farmer Mac II Program, a result of rate adjustments in January 1995, and the increased level of yield maintenance income above the accelerated level of premium amortization. During the three months ended March 31, 1995, prepayments of mortgage loans underlying the Farmer Mac I Securities totaled $8.2 million, as compared to $11.6 million for the three months ended March 31, 1994. As a result of these prepayments, Farmer Mac recognized $357 thousand of interest income from yield maintenance payments in the three months ended March 31, 1995, as compared to $240 thousand in the three months ended March 31, 1994, and accelerated the level of premium amortization by $297 thousand in the three months ended March 31, 1995, as compared to $455 thousand in the three months ended March 31, 1994. Interest Expense. Interest expense for the three months ended March 31, 1995 and 1994 amounted to $7.8 million and $7.6 million, respectively, an increase of $126 thousand. The increase in interest expense is attributable to the 63 basis point (0.63%) increase in the average cost of interest-bearing liabilities, a result of the increase in short-term interest rates from March 31, 1994 to March 31, 1995. As of March 31, 1995, the Corporation had outstanding $125.1 million of Discount Notes with a weighted average rate of 6.05% as compared to $115.5 million of Discount Notes with a weighted average rate of 3.38% at March 31, 1994. Other Income. Other income totaled $324 thousand for the three months ended March 31, 1995 and 1994. Guarantee fee income, the principal component of other income, increased $40 thousand from $267 thousand for the three months ended March 31, 1994 to $307 thousand for the three months ended March 31, 1995. The increase is largely attributable to the issuance of $98.1 million of Farmer Mac I Securities in the third quarter of 1994 and the first quarter of 1995 and to the $31.6 million growth in the Farmer Mac II Program since March 31, 1994. Miscellaneous income, composed primarily of transaction fees generated from the Farmer Mac II Program, decreased $40 thousand from $57 thousand for the three months ended March 31, 1994 to $17 thousand for the three months ended March 31, 1995. The decrease in transaction fees results from the level of issuances of Farmer Mac II Securities and purchases of Guaranteed Portions under the Farmer Mac II Program for the comparable periods. Farmer Mac issued $4.4 million of Farmer Mac II Securities and purchased $3.5 million of Guaranteed Portions for the three months ended March 31, 1995, as compared to $14.2 million of issuances of Farmer Mac II Securities for the three months ended March 31, 1994. Other Expenses. Other expenses totaled $898 thousand for the three months ended March 31, 1995, an increase of $38 thousand from the three months ended March 31, 1994. The increase in other expenses is attributable to the increase in insurance expense, regulatory fees and compensation and employee benefits, which were partially offset by the decrease in administrative expenses. Insurance expense increased $22 thousand from the three months ended March 31, 1994 to the three months ended March 31, 1995, a result of an increase in the amount of Directors and Officers Liability insurance coverage. Regulatory fees increased $22 thousand from the three months ended March 31, 1994 to the three months ended March 31, 1995, a result of the increase in Farmer Mac's assessment from $326 thousand for the 1993-94 fiscal year (subsequently reduced by a $34 thousand refund from the 1992-93 fiscal year) to $368 thousand for the 1994-95 fiscal year. Compensation and employee benefits increased $13 thousand from the three months ended March 31, 1994 to the three months ended March 31, 1995, a result of an increase in staffing during the comparable periods. During the first quarter of 1994, Farmer Mac added an additional employee to assume legal responsibilities for the Farmer Mac II Program, previously performed by an outside law firm. Administrative expenses decreased $17 thousand from the three months ended March 31, 1994 to the three months ended March 31, 1995, a result of a reduction in travel related expenses and advertising costs, both of which resulted from less pooler activity. Dividends. Farmer Mac has not paid and does not expect to pay dividends on its common stock in the near future. Dividends on the common stock are subject to determination and declaration by the Board. In February 1992, the Board adopted a policy stating that no dividends would be paid on Farmer Mac Voting or Non-Voting Common Stock until such time as Farmer Mac's stockholders' equity is at least equal to $22 million (the amount of gross proceeds raised by Farmer Mac in its initial common stock offering). Thereafter, up to 50% of accumulated net earnings may be paid out as dividends, provided that stockholders' equity remains at least equal to $22 million. No preference between holders of the Voting Common Stock and Class C Non-Voting Common Stock has been established relating to dividends. The ratio of dividends paid on each share of Class C Non-Voting Common Stock to each share of Voting Common Stock, however, will be three-to-one. If dividends are to be paid to holders of the Voting Common Stock, such per share dividends to holders of Class A and Class B Voting Common Stock will be equal.
PART II - OTHER INFORMATION Item 1. Legal Proceedings. The registrant is not a party to any pending legal proceedings. Item 2. Changes in Securities. Not applicable. Item 3. Defaults upon Senior Securities. Not applicable. Item 4. Submission of Matters to a Vote of Stockholders. Not applicable. Item 5. Other Information. None. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. Description * 3.1 - Title VII of Public Law 100-233 (Form 10 filed January 24, 1989). * 3.2 - Section 1839 of the Food, Agriculture, Conservation and Trade Act of 1990 (P.L. 101-624) (Form 10-K filed April 1, 1991). * 3.3 - Section 503 of the Food, Agriculture, Conservation, and Trade Act Amendments of 1991 (P.L. 102-237) (Form 10-K filed March 30, 1992). ** 3.4 - Amended and restated Bylaws of the registrant. +* 10.1 - Stock Option Plan (Previously filed as Exhibit 19.1 to Form 10-Q filed August 14, 1992). ___________________ * Incorporated by reference to the indicated prior filing. ** Filed herewith. + Management contract or compensatory plan.
+* 10.2 - Amendment No. 1 to Stock Option Plan (Form 10-Q filed August 16, 1993). +* 10.3 - Employment Agreement dated May 5, 1989 between Henry D. Edelman and the Registrant (Previously filed as Exhibit 10.4 to Form 10-K filed February 14, 1990). +* 10.4 - Amendment No. 1, dated January 10, 1991, to Employment Agreement between Henry D. Edelman and the Registrant (Form 10-K filed April 1, 1991). +* 10.5 - Amendment to Employment Contract dated as of June 1, 1993 between Henry D. Edelman and the Registrant (Form 10-Q filed November 15, 1993). +* 10.6 - Amendment No. 3, dated as of June 1, 1994, to Employment Contract between Henry D. Edelman and the Registrant (Form 10-Q filed August 15, 1994). +* 10.7 - Employment Agreement dated May 11, 1989 between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.5 to Form 10-K filed February 14, 1990). +*10.8 - Amendment dated December 14, 1989 to Employment Agreement between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.5 to Form 10-K filed February 14, 1990). +* 10.9 - Amendment No. 2 dated February 14, 1991, to Employment Agreement between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.7 to Form 10-K filed April 1, 1991). +* 10.10 - Amendment to Employment Contract dated as of June 1, 1993 between Nancy E. Corsiglia and the Registrant (Previously filed as Exhibit 10.9 to Form 10-Q filed November 15, 1993). _________________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan.
+* 10.11 - Amendment No. 4 dated June 1, 1993 to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-K filed March 30, 1994). +* 10.12 - Amendment No. 5, dated as of June 1, 1994, to Employment Contract between Nancy E. Corsiglia and the Registrant (Form 10-Q filed August 15, 1994). +* 10.13 - Employment Agreement dated June 13, 1989 between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.6 to Form 10-K filed February 14, 1990). +* 10.14 - Amendment No. 1 dated February 14, 1991 to Employment Agreement between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.9 to Form 10-K filed April 1, 1991). +* 10.15 - Amendment to Employment Contract dated as of June 1, 1993 between Thomas R. Clark and the Registrant (Previously filed as Exhibit 10.12 to Form 10-Q filed November 15, 1993). +* 10.16 - Amendment No. 3 dated June 1, 1993 to Employment Contract between Thomas R. Clark and the Registrant (Form 10-K filed March 30, 1994). +* 10.17 - Amendment No. 4, dated as of June 1, 1994, to Employment Contract between Thomas R. Clark and the Registrant (Form 10-Q filed August 15, 1994). +* 10.18 - Employment Agreement dated April 29, 1994 between Charles M. Lewis and the Registrant (Form 10-Q filed August 15, 1994). +* 10.19 - Employment Agreement dated October 7, 1991 between Michael T. Bennett and the Registrant (Previously filed as Exhibit 10.16 to Form 10-K filed March 30, 1992). _____________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan.
+* 10.20 - Amendment to Employment Contract dated as of June 1, 1993 between Michael T. Bennett and the Registrant (Previously filed as Exhibit 10.17 to Form 10-Q filed November 15, 1993). +* 10.21 - Amendment No. 2 dated June 1, 1993 to Employment Contract between Michael T. Bennett and the Registrant (Form 10-K filed March 30, 1994). +* 10.22 - Amendment No. 3, dated as of June 1, 1994, to Employment Contract between Michael T. Bennett and the Registrant (Form 10-Q filed August 15, 1994). +* 10.23 - Employment Agreement dated March 15, 1993 between Christopher A. Dunn and the Registrant (Previously filed as Exhibit 10.17 to Form 10-Q filed May 17, 1993). +* 10.24 - Amendment to Employment Contract dated as of June 1, 1993 between Christopher A. Dunn and the Registrant (Previously filed as Exhibit 10.19 to Form 10-Q filed November 15, 1993). +* 10.25 - Amendment No. 2 dated June 1, 1993 to Employment Contract between Christopher A. Dunn and the Registrant (Form 10-K filed March 30, 1994). +* 10.26 - Amendment No. 3, dated as of June 1, 1994, to Employment Contract between Christopher A. Dunn and the Registrant (Form 10-Q filed August 15, 1994). * 10.27 - Lease Agreement, dated September 30, 1991 between 919 Eighteenth Street, N.W., Associates Limited Partnership and the Registrant (Previously filed as Exhibit 10.20 to Form 10-K filed March 30, 1992). ________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan.
* 10.28 - Strategic Alliance Agreement, dated November 15, 1994, between Western Farm Bank and the Registrant, as amended January 1, 1995 (Form 10-K filed March 31, 1995). 21 - Subsidiaries. 21.1 - Farmer Mac Mortgage Securities Corporation, a Delaware corporation. 21.2 - Farmer Mac Acceptance Corporation, a Delaware corporation. * 99.1 - Map of U.S. Department of Agriculture (USDA) Regions (Previously filed as Exhibit 1.1 to Form 10-K filed April 1, 1991). (b) Reports on Form 8-K. The Registrant has not filed any reports on Form 8-K during the quarter ended March 31, 1995. _________________ * Incorporated by reference to the indicated prior filing. + Management contract or compensatory plan.
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly aused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FEDERAL AGRICULTURAL MORTGAGE CORPORATION May 15, 1995 By:/s/ Henry D. Edelman __________________________________________ Henry D. Edelman President and Chief Executive Officer (Principal Executive Officer) /s/ Nancy E. Corsiglia _________________________________ Nancy E. Corsiglia Vice President - Treasurer and Chief Financial Officer (Principal Financial Officer)
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _________________________________ EXHIBITS TO FORM 10-Q UNDER THE SECURITIES EXCHANGE ACT OF 1934 ____________________________________ FEDERAL AGRICULTURAL MORTGAGE CORPORATION
Exhibit Description ** 3.4 Amended and restated Bylaws of the Registrant. ___________________ ** Filed Herewith.