Terms

Series

5.700% Non-Cumulative Preferred Stock, Series D

Liquidation Preference

$25.00

Coupon Rate

5.7%

Rate Type

Fixed

Annual Dividend

$1.43

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

July 17, 2024

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Liabilities And Debt Obligations Of Farmer Mac; Pari Passu With: 5.875% Non-Cumulative Preferred Stock, Series A, 6.875% Non-Cumulative Preferred Stock, Series B, 6.000% Fixed-To-Floating Rate Non-Cumulative Preferred Stock, Series C; Senior To: Class A Voting Common Stock, Class B Voting Common Stock, Class C Non-Voting Common Stock

Regulatory (Basel III) Call

No

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Shares Offered

4,000,000

Prospectus Summary

Federal Agricultural Mortgage Corporation (Farmer Mac), a federally chartered U.S. government instrumentality, is issuing 4,000,000 shares of its 5.700% Non-Cumulative Preferred Stock, Series D, with a $25.00 par value and $25.00 liquidation preference, generating $1.425 per share annually ($0.35625 per quarter). The stock is first callable on July 17, 2024, and on any dividend payment date thereafter at $25.00 per share. As non-cumulative preferred stock, if Farmer Mac's Board chooses not to declare a dividend in any quarter, that dividend is permanently forfeited and holders have no right to claim it in future periods. The Series D Preferred ranks senior to all three classes of Farmer Mac common stock and pari passu with the outstanding Series A (5.875%), Series B (6.875%), and Series C (6.000% Fixed-to-Floating) preferred series. In liquidation, preferred holders are paid only after all liabilities of Farmer Mac are satisfied. There is no regulatory capital call provision in this certificate; unlike bank holding company preferred securities, Farmer Mac's status as a federally chartered instrumentality means it is not subject to Basel III Tier 1 capital treatment triggers. Notably, if Farmer Mac defaults on six quarters of declared dividends, holders gain the right to elect two observers to the Board of Directors. At par, the Series D yields 5.70% annually, paid quarterly on January 17, April 17, July 17, and October 17, with record dates set between 10 and 45 days prior to each payment date. Tax treatment is not explicitly detailed in this Certificate of Designation; investors should consult a tax advisor as Farmer Mac's unique charter status may affect QDI or DRD eligibility. Dividend stopper mechanics prevent payment of dividends on common or junior stock unless the current-period Series D dividend has been declared and paid in full, while parity preferred dividends must be paid ratably with Series D; however, since dividends are non-cumulative, the Board retains full discretion to omit any quarterly dividend entirely with no future obligation.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Farmer Mac has not paid full dividends on the Series D Preferred Stock for the current dividend period, it may not pay dividends on common stock or any junior stock; parity preferred dividends must also be paid ratably alongside Series D dividends.

Other Preferreds from Federal Agricultural Mortgage Corporation

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 45 (Average)