The Farm Credit West Preferred Stock program provides existing customers/stockholders the opportunity to further invest in their association while earning a competitive return on their investment. Below is a summary of some of the key features of this program. For a complete description of the terms and conditions of Farm Credit West Preferred Stock’s program, you may request FCW’s Preferred Stock Disclosure Statement.
Who’s Eligible?Any existing stockholder of any class of common stock or participation certificates of Farm Credit West may purchase shares of Preferred Stock.
How are Dividends Paid?
- Rate - The dividend rate is established by the Farm Credit West Board of Directors on or before the last day of each calendar month. The current dividend rate effective March 2018 is 2.10%. Rate
history and current rate information may be obtained from your local Farm Credit West office.
Automatic Reinvestment of Dividends - Under the terms of the Subscription Agreement, any dividend paid on Preferred Stock will be applied to the purchase of additional shares of Preferred Stock at par value. Accordingly, holders of Preferred Stock will not receive cash distributions until it is retired by redemption. Instead, any dividend paid on Preferred Stock will result in an increase in the number of shares held by each holder.
Declaration - Dividends will be declared in the order accrued (i.e., the oldest first) and will be payable upon declaration by the Farm Credit West Board. Dividends will be paid on the effective date of the declaration to holders of Preferred Stock during the period specified by the declaration.
- Rate - The dividend rate is established by the Farm Credit West Board of Directors on or before the last day of each calendar month. The current dividend rate effective March 2018 is 2.10%. Rate history and current rate information may be obtained from your local Farm Credit West office.
When can I request retirement?Preferred Stock has no fixed maturity, term, or retirement date. A holder of Preferred Stock may request retirement at any time. Retirement requests must be for a minimum of 1,000 shares ($1,000). Shares of Preferred Stock may be retired only at the discretion of the Farm Credit West Board provided certain regulatory requirements are met. All shares approved for retirement will be retired at an amount equal to the share’s par value, plus accrued but unpaid dividends.
When are my transactions processed?Farm Credit West processes Preferred Stock Program investments and retirements only on the first business day of the month. The amount of Preferred Stock issued for each holder will be on a “first come, first served” basis after considering any individual or program issuance limitations then in effect.
Is my Preferred Stock Transferable?Preferred Stock is transferable only to another holder of Preferred Stock and then only after the transferor provides written notice to Farm Credit West.
Preferred Stock is an “At-Risk” InvestmentThe purchase of Preferred Stock is an “at risk” investment in Farm Credit West. It is not a deposit or compensating balance. Neither the return of the purchaser’s investment, in whole or in part, nor the receipt of any dividends thereon, is guaranteed by the Association or any affiliate thereof, any federal or state government or agency, or any third party.
What are the Tax Consequences of holding Preferred Stock?The Association will comply with applicable dividend reporting requirements under federal income tax laws. Any dividends paid by Farm Credit West on Preferred Stock will be included in the federal taxable income of the holder and subject to tax the same as other “ordinary dividend income.” Each holder of Preferred Stock is urged to consult their own tax advisor as to specific tax consequences, including tax return reporting requirements and the applicability and effect of federal, state, local, and other applicable tax laws.
How do I Subscribe?
Stockholders interested in purchasing Preferred Stock will be provided a Disclosure Statement that thoroughly describes the Preferred Stock Program. To subscribe, the stockholder completes a Subscription Agreement and provides a check made payable to “Farm Credit West, ACA” in the amount of the purchase price of the shares. In lieu of a check, the purchaser may direct Farm Credit West to apply any of purchaser’s funds held by the Association toward the purchase of Preferred Stock.
Your initial subscription must be for a minimum of 5,000 shares ($5,000). Subsequent subscription requests must be a minimum of 1,000 shares ($1,000). Each holder of Preferred Stock must maintain ownership of a minimum of 5000 shares ($5,000) at all times. No subscription to a single investor can exceed the limit established by Farm Credit West, which may be amended from time to time.