FEDERAL AGRICULTURAL MORTGAGE CORPORATION (NYSE:AGM) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02.
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Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(e)
Grants of Stock Appreciation Rights
On March 14, 2017 (the Grant Date), the Compensation Committee
(the Committee) of the Board of Directors of Farmer Mac approved
grants of stock appreciation rights (SARs) to the following
executive officers of Farmer Mac to Farmer Macs 2008 Omnibus
Incentive Plan (the 2008 Plan):
(the Committee) of the Board of Directors of Farmer Mac approved
grants of stock appreciation rights (SARs) to the following
executive officers of Farmer Mac to Farmer Macs 2008 Omnibus
Incentive Plan (the 2008 Plan):
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Name
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Number of SARs Granted
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Timothy L. Buzby
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10,662
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R. Dale Lynch
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5,757
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John C. Covington
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4,857
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Stephen P. Mullery
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3,381
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Each SAR granted represents the right to receive, upon exercise,
an amount equal to the excess, if any, of the fair market value
of a share of Farmer Macs Class C non-voting common stock (each,
a Share) over the grant price on the applicable date of exercise.
Any amount received upon exercise of SARs is payable in Shares.
The grant price for the SARs listed above is $60.84 per Share,
which was the closing price of a Share on the New York Stock
Exchange on the Grant Date, in accordance with a policy adopted
by the Committee and the full Board of Directors (the Equity
Grant Policy). These SARs will vest in three equal annual
installments on each of March 31, 2018, March 31, 2019, and March
31, 2020, and their expiration date is March 14, 2027 (the
Expiration Date), which is the tenth anniversary of the Grant
Date.
an amount equal to the excess, if any, of the fair market value
of a share of Farmer Macs Class C non-voting common stock (each,
a Share) over the grant price on the applicable date of exercise.
Any amount received upon exercise of SARs is payable in Shares.
The grant price for the SARs listed above is $60.84 per Share,
which was the closing price of a Share on the New York Stock
Exchange on the Grant Date, in accordance with a policy adopted
by the Committee and the full Board of Directors (the Equity
Grant Policy). These SARs will vest in three equal annual
installments on each of March 31, 2018, March 31, 2019, and March
31, 2020, and their expiration date is March 14, 2027 (the
Expiration Date), which is the tenth anniversary of the Grant
Date.
For the SARs awarded on the Grant Date, upon a participants
termination of employment for death or disability (as defined in
the 2008 Plan), all unvested SARs will automatically vest and
become exercisable and vested SARs will remain exercisable for
one year or until the Expiration Date, whichever is earlier.
termination of employment for death or disability (as defined in
the 2008 Plan), all unvested SARs will automatically vest and
become exercisable and vested SARs will remain exercisable for
one year or until the Expiration Date, whichever is earlier.
Upon a participants termination of employment for retirement, all
unvested SARs will continue to vest as scheduled and vested SARs
will remain exercisable for five years or until the Expiration
Date, whichever is earlier. For these purposes, retirement is
defined as the termination of employment without Cause (as
defined in the 2008 Plan, in Farmer Macs Amended and Restated
Executive Officer Severance Plan, or in a participants employment
agreement, as applicable) after
unvested SARs will continue to vest as scheduled and vested SARs
will remain exercisable for five years or until the Expiration
Date, whichever is earlier. For these purposes, retirement is
defined as the termination of employment without Cause (as
defined in the 2008 Plan, in Farmer Macs Amended and Restated
Executive Officer Severance Plan, or in a participants employment
agreement, as applicable) after
attaining age fifty-five (55) and a combined age and years of
employment at Farmer Mac of at least sixty-five (65).
employment at Farmer Mac of at least sixty-five (65).
Upon a participants termination of employment for any reason
other than death, disability, retirement, or for Cause, all
unvested SARs will be cancelled immediately and vested SARs will
remain exercisable for one year or until the Expiration Date,
whichever is earlier. Upon a participants termination for Cause,
any unexercised SARs, whether vested or unvested, will be
cancelled immediately.
other than death, disability, retirement, or for Cause, all
unvested SARs will be cancelled immediately and vested SARs will
remain exercisable for one year or until the Expiration Date,
whichever is earlier. Upon a participants termination for Cause,
any unexercised SARs, whether vested or unvested, will be
cancelled immediately.
Under the Equity Grant Policy, the number of SARs awarded as
equity-based compensation is based on a target long-term
incentive value approved by the Committee for an individual
divided by the Black-Scholes value as of seven calendar days
before the date of grant based on assumptions consistent with the
assumptions used by Farmer Mac for determining stock-based
compensation expense under the Financial Accounting Standards
Boards Accounting Standards Codification (ASC) Topic 718.
equity-based compensation is based on a target long-term
incentive value approved by the Committee for an individual
divided by the Black-Scholes value as of seven calendar days
before the date of grant based on assumptions consistent with the
assumptions used by Farmer Mac for determining stock-based
compensation expense under the Financial Accounting Standards
Boards Accounting Standards Codification (ASC) Topic 718.
The 2008 Plan was previously filed as Exhibit 10.1.2 to Farmer
Macs Quarterly Report on Form 10-Q filed on August 12, 2008. The
current form of award agreement for SARs awarded under the 2008
Plan on the Grant Date was previously filed as Exhibit 10.1 to
the Current Report on Form 8-K filed on April 3, 2015. Both of
those Exhibits are incorporated in this report by reference.
Macs Quarterly Report on Form 10-Q filed on August 12, 2008. The
current form of award agreement for SARs awarded under the 2008
Plan on the Grant Date was previously filed as Exhibit 10.1 to
the Current Report on Form 8-K filed on April 3, 2015. Both of
those Exhibits are incorporated in this report by reference.
Grants of Restricted Stock
Also on the Grant Date, the Committee approved grants of
restricted shares of Farmer Macs Class C non-voting common stock
(the Restricted Stock) to the following executive officers and
directors of Farmer Mac to the 2008 Plan:
restricted shares of Farmer Macs Class C non-voting common stock
(the Restricted Stock) to the following executive officers and
directors of Farmer Mac to the 2008 Plan:
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Executive Officers
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Name
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Number of Shares of Restricted Stock Granted
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Time-Based Vesting
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Performance-Based Vesting
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Timothy L. Buzby
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5,649
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2,824
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R. Dale Lynch
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3,051
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1,524
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John C. Covington
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2,574
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1,286
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Stephen P. Mullery
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1,791
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Directors
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Name
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Number of Shares of Restricted Stock Granted
(Time-Based Vesting) |
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Dennis Brack
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Chester Culver
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Richard Davidson
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James Engebretsen
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Dennis Everson
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Sara Faivre
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Douglas Felton
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Douglas Flory
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Thomas Hill
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Mitchell Johnson
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Lowell Junkins
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Clark Maxwell
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Bruce Sherrick
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Myles Watts
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Douglas Wilhelm
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The Restricted Stock listed above granted to directors will vest
in full on March 31, 2018 or proportionately to the date of any
directors (i) death, (ii) disability, or (iii) cessation of
service on the Board without cause, including due to removal or
replacement as a director by the President of the United States.
in full on March 31, 2018 or proportionately to the date of any
directors (i) death, (ii) disability, or (iii) cessation of
service on the Board without cause, including due to removal or
replacement as a director by the President of the United States.
The Restricted Stock listed above granted to executive officers
as time-based vesting awards will vest in three equal annual
installments on each of March 31, 2018, March 31, 2019, and March
31, 2020.
as time-based vesting awards will vest in three equal annual
installments on each of March 31, 2018, March 31, 2019, and March
31, 2020.
The Restricted Stock listed above granted to executive officers
as performance-based vesting awards will vest on March 31, 2020,
subject to attainment of the following performance targets:
as performance-based vesting awards will vest on March 31, 2020,
subject to attainment of the following performance targets:
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Fifty percent (50%) of the performance-based vesting
Restricted Stock shall vest on March 31, 2020 if the Committee determines that Farmer Mac maintained compliance with all applicable regulatory capital requirements between January 1, 2017 and December 31, 2019, with the Committee retaining discretion to vest 0% to 50% of this portion of the award based on the Committees subjective evaluation of the efficiency of Farmer Macs use of capital over that three-year period; and |
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Fifty percent (50%) of the performance-based vesting
Restricted Stock shall vest on March 31, 2020 if the Committee determines that Farmer Mac achieved (i) an annual rate of net charge-offs in the Farm Ranch line of business to the average balance of |
outstanding guarantees, loans, and commitments in the Farm Ranch
line of business less than or equal to 20 basis points for the
period starting on January 1, 2017 and ending on December 31,
2019; and>(ii) an average percentage of total 90-day
delinquencies in the Farm Ranch line of business to the average
balance of outstanding guarantees, loans, and commitments in the
Farm Ranch line of business of not greater than 2.5% for the
period starting on January 1, 2017 and ending on December 31,
2019. For purposes of performing these calculations: (y) net
charge-offs is defined as charge-offs to Farmer Macs allowance
for losses net of actual recoveries plus any writedowns on real
estate owned (REO) properties and any gains or losses realized
upon disposition of REO properties, and (z) average balances are
determined by calculating a simple average of reported balances
as of the end of each calendar quarter.
line of business less than or equal to 20 basis points for the
period starting on January 1, 2017 and ending on December 31,
2019; and>(ii) an average percentage of total 90-day
delinquencies in the Farm Ranch line of business to the average
balance of outstanding guarantees, loans, and commitments in the
Farm Ranch line of business of not greater than 2.5% for the
period starting on January 1, 2017 and ending on December 31,
2019. For purposes of performing these calculations: (y) net
charge-offs is defined as charge-offs to Farmer Macs allowance
for losses net of actual recoveries plus any writedowns on real
estate owned (REO) properties and any gains or losses realized
upon disposition of REO properties, and (z) average balances are
determined by calculating a simple average of reported balances
as of the end of each calendar quarter.
Upon an executive officers termination of employment for any
reason other than death, disability, or retirement, unvested
Restricted Stock will be cancelled immediately. Upon an executive
officers death or disability, unvested Restricted Stock will vest
immediately. Upon retirement, unvested Restricted Stock will
continue to vest as scheduled. For these purposes, retirement has
the same meaning used in the SARs award agreements described
above.
reason other than death, disability, or retirement, unvested
Restricted Stock will be cancelled immediately. Upon an executive
officers death or disability, unvested Restricted Stock will vest
immediately. Upon retirement, unvested Restricted Stock will
continue to vest as scheduled. For these purposes, retirement has
the same meaning used in the SARs award agreements described
above.
Under the Equity Grant Policy, the number of shares of Restricted
Stock awarded as equity-based compensation is based on a target
long-term incentive value approved by the Committee for an
individual divided by the average closing price of Farmer Macs
Class C non-voting common stock over the previous 30 calendar
days ending seven calendar days before the date of grant.
Stock awarded as equity-based compensation is based on a target
long-term incentive value approved by the Committee for an
individual divided by the average closing price of Farmer Macs
Class C non-voting common stock over the previous 30 calendar
days ending seven calendar days before the date of grant.
The forms of award agreements for Restricted Stock awarded to
executive officers under the 2008 Plan on the Grant Date were
previously filed as Exhibits 10.2 and 10.3 to the Current Report
on Form 8-K filed on April 3, 2015. The form of award agreement
for Restricted Stock awarded to directors under the 2008 Plan on
the Grant Date was previously filed as Exhibit 10.3 to the
Current Report on Form 8-K filed on April 6, 2012. All of those
Exhibits are incorporated in this report by reference.
executive officers under the 2008 Plan on the Grant Date were
previously filed as Exhibits 10.2 and 10.3 to the Current Report
on Form 8-K filed on April 3, 2015. The form of award agreement
for Restricted Stock awarded to directors under the 2008 Plan on
the Grant Date was previously filed as Exhibit 10.3 to the
Current Report on Form 8-K filed on April 6, 2012. All of those
Exhibits are incorporated in this report by reference.
Awards of Cash Bonuses
On March 14, 2017, the Committee approved the payment of the
following performance-based cash bonuses to Farmer Macs executive
officers, which were calculated based on targets for Farmer Macs
core earnings, outstanding business volume, asset quality, and
net charge-offs, as well as each individuals leadership and
strategic performance, in each case for the period
following performance-based cash bonuses to Farmer Macs executive
officers, which were calculated based on targets for Farmer Macs
core earnings, outstanding business volume, asset quality, and
net charge-offs, as well as each individuals leadership and
strategic performance, in each case for the period
from January 1, 2016 through December 31, 2016, as determined by
the Committee. In each case, the bonus will be paid out at
148.3324% of the individuals target bonus for 2016.
the Committee. In each case, the bonus will be paid out at
148.3324% of the individuals target bonus for 2016.
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Name
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Cash Bonus Awarded
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Timothy L. Buzby
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$830,661.42
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R. Dale Lynch
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$292,196.28
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John C. Covington
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$165,768.87
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Stephen P. Mullery
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$188,689.42
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All of the equity and cash compensation awards to executive
officers described above are subject to any recoupment or
clawback policy as may be adopted by the Board of Directors of
Farmer Mac, including to comply with the Dodd-Frank Wall Street
Reform and Consumer Protection Act, or other applicable law or
regulation.
officers described above are subject to any recoupment or
clawback policy as may be adopted by the Board of Directors of
Farmer Mac, including to comply with the Dodd-Frank Wall Street
Reform and Consumer Protection Act, or other applicable law or
regulation.
About FEDERAL AGRICULTURAL MORTGAGE CORPORATION> (NYSE:AGM)
Federal Agricultural Mortgage Corporation (Farmer Mac) provides a secondary market for a range of loans made to borrowers in rural America. The Company operates through four segments: Farm & Ranch, the United States Department of Agriculture (USDA) Guarantees, Rural Utilities and Institutional Credit. The Company purchases mortgage loans on agricultural real estate and rural housing under the Farm & Ranch line of business. Under the USDA Guarantees business, Farmer Mac II LLC, a subsidiary of Farmer Mac, purchases agricultural, rural development, business and industry, and community facilities loans guaranteed by the USDA. The Company purchases and guarantees securities backed by rural utilities loans under the Rural Utilities business. Under the Institutional Credit line of business, Farmer Mac purchases or guarantees general obligations of institutions approved by Farmer Mac. The Company sells its guarantees of securities under the AgVantage brand name. FEDERAL AGRICULTURAL MORTGAGE CORPORATION> (NYSE:AGM) Recent Trading Information
FEDERAL AGRICULTURAL MORTGAGE CORPORATION> (NYSE:AGM) closed its last trading session up +0.05 at 61.57 with 29,811 shares trading hands.
