National Rural Utilities Cooperative Finance Corporation (NRUC), a miscellaneous business credit institution, has entered into an enhanced financial agreement with Farmer Mac Mortgage Securities Corporation (FMMSC), as disclosed in a recent SEC filing.
The Fifth Amended and Restated First Supplemental Note Purchase Agreement, dated January 14, 2025, modifies NRUC's existing arrangement with FMMSC, a subsidiary of Federal Agricultural (NYSE:AGM) Mortgage Corporation (Farmer Mac).
The revised agreement increases the Maximum Purchase Amount available to NRUC from $6 billion to $6.5 billion and extends the draw period for notes from June 30, 2027, to January 14, 2030. This extension provides NRUC with a longer timeframe to access financial resources. Additionally, the agreement allows for successive one-year renewals, which are subject to approval by Farmer Mac and FMMSC, provided that NRUC gives sixty days' notice.
As of the date of the agreement, NRUC reported $3.5 billion of secured notes outstanding under the Master Note Purchase Agreement. In conjunction with the updated note purchase agreement, NRUC and U.S. Bank National Association, acting as the collateral agent, have also entered into a Third Amended and Restated Pledge Agreement. This pledge agreement requires NRUC to secure its obligations by pledging eligible loans in an amount at least equal to the total principal amount of notes outstanding.
The financial instruments in question, 7.35% Collateral Trust Bonds due 2026 (NYSE:NRUC 26) and 5.50% Subordinated Notes due 2064 (NYSE:NRUC), are registered on the New York Stock Exchange.
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