As filed with the Securities and Exchange Commission on March 25, 2022
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
National
Rural Utilities Cooperative Finance Corporation
(Exact name of registrant
as specified in its charter)
| District of Columbia |
|
52-0891669 |
(State or other jurisdiction of
incorporation or organization) |
|
(I.R.S. Employer Identification
No.) |
20701 Cooperative Way
Dulles, Virginia 20166
(703) 467-1800
(Address, including zip code,
and telephone number, including area code, of registrant’s principal executive offices)
Roberta B. Aronson, General
Counsel
National Rural Utilities
Cooperative Finance Corporation 20701 Cooperative Way
Dulles, Virginia 20166
(703) 467-1800
(Name, address, including zip
code, and telephone number, including area code, of agent for service)
Copies to:
Joseph
E. Gilligan
Hogan
Lovells US LLP
555 Thirteenth Street, NW
Washington, D.C. 20004-1109
(202) 637-5945
Approximate
date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement.
If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check
the following box. ¨
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, please check the
following box. x
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
o
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration statement for the same offering. o
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective
upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. þ
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional
securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. o
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non- accelerated filer, a smaller reporting company or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ¨ | |
Accelerated filer ¨ |
| Non-accelerated filer x | |
Smaller reporting company ¨ |
| | |
Emerging growth company ¨ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ¨
National Rural Utilities
Cooperative
Finance Corporation
VARIABLE
DENOMINATION
FLOATING RATE DEMAND NOTES
OFFERED AS SET FORTH HEREIN PURSUANT TO THE
CFC DAILY LIQUIDITY PROGRAM
National Rural Utilities Cooperative Finance Corporation
(“CFC”) offers its Variable Denomination Floating Rate Demand Notes (the “Notes”) pursuant to the CFC Daily Liquidity
Program (the “Daily Liquidity Program”). The Notes pay interest at a floating rate. CFC files pricing supplements with the
Securities and Exchange Commission (“SEC”) that disclose the then-current interest rate on the Notes.
Key aspects of the Daily Liquidity Program are:
| • | CFC will set interest rates with respect to the Notes daily based on prevailing market conditions. When
the rate changes, CFC will file a pricing supplement with the SEC disclosing the new rate. Interest accrues daily and will be calculated
based on a 365-day year. Interest will be paid monthly. |
| • | You may redeem your Notes at any time, provided that same day
redemption requires that CFC receive notification of redemption no later than 11:00 a.m. Eastern time. |
| • | The aggregate principal amount of Notes outstanding from this
offering at any one time shall not exceed $3 billion. |
Key factors to consider before investing include:
| • | Your investment is not a deposit or other bank account and is not insured by the Federal Deposit
Insurance Corporation or any other insurance or governmental or non-governmental agency. |
| • | The Notes are not an investment in a money market mutual fund and are not subject to the requirements
of the Investment Company Act of 1940, as amended (including requirements relating to diversification and quality of investments). |
| • | The Notes are unsecured obligations of CFC and only CFC’s unpledged or unencumbered assets
may be available to pay the principal of and interest on the Notes along with all other unsecured obligations of CFC. It is possible for
you to lose some or all of your investment in the Notes, including accrued interest, if CFC is unable to pay its debts, becomes bankrupt
or seeks creditor protection. |
| • | The Notes are not transferable. |
The Notes will rank equally and ratably with all other unsecured
senior debt of CFC. At November 30, 2021, CFC had outstanding senior debt of $25.6 billion, of which $9.2 billion was unsecured, and $0.7
billion of guarantees of indebtedness of others.
The Notes are offered on a continuous basis. The Notes registered
on the registration statement of which this prospectus is a part represent the maximum aggregate principal amount of the Notes, equal
to $20,000,000,000, which are expected to be offered for sale. The maximum aggregate principal amount of the Notes that may be outstanding
at any particular time is $3,000,000,000.
Investing in the Notes involves certain risks. See
“Risk Factors” beginning on page 4 of this prospectus, as well as the risk factors that are incorporated by reference in this
prospectus.
Neither the SEC nor any state securities commission
has approved or disapproved these debt securities, or determined if this prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
The date of this prospectus is March 25, 2022
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
To understand the terms of the
Notes offered by this prospectus, you should carefully read this prospectus and any pricing supplement. You should also read the documents
referred to under the heading “Where You Can Find More Information” and “Incorporation by Reference” for information
on National Rural Utilities Cooperative Finance Corporation (“CFC” or “the Company”, also referred to as “we,”
“us” and “our”), including its financial statements. Certain capitalized terms used in this prospectus are defined
elsewhere in this prospectus.
We have not authorized anyone to
provide information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to
which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information
that others may give you. We are not making an offer of these Notes in any state or jurisdiction where such offer is not permitted. We
do not claim the accuracy of the information in this prospectus as of any date other than the date stated on the cover, regardless of
time of delivery of this prospectus or any sale of the Notes.
SUMMARY
This section summarizes the terms
of the Notes that are described in greater detail below under “Description of CFC Daily Liquidity Program.” You should read
this more detailed description together with the information contained in other parts of this prospectus, as well as the applicable pricing
supplements relating to the Notes.
| Issuer |
National Rural Utilities Cooperative Finance Corporation. |
| |
|
| Title |
Variable Denomination Floating Rate Demand Notes. |
| Amount |
Up to $20,000,000,000 aggregate principal amount
(up to $3,000,000,000 aggregate principal amount of Notes outstanding at any particular time). |
| |
|
| |
|
| Ranking |
The Notes are unsecured and unsubordinated obligations of CFC and will rank equally and ratably with all other unsecured senior indebtedness of CFC. |
| |
|
| Minimum Investment |
$50,000. |
| |
|
| |
|
| Maturity |
The Notes have no stated maturity. The Notes are demand investments redeemable in whole or in part on any CFC business day at the option of the holder. CFC reserves the right to redeem the Notes of any holder, in whole or in part, at any time at its option. |
| |
|
| Interest |
The Notes earn interest at a floating rate per annum. The floating interest rate is subject to daily adjustment by CFC. When the rate changes, CFC will file a pricing supplement with the SEC disclosing the new rate. Interest will accrue on a daily basis and be calculated on a 365-day year. |
| |
|
| Form of Notes |
The Notes are issued as one or more global securities held by U.S. Bank Trust Company, National Association. Book-entry records for each investor are maintained by CFC. |
| |
|
| Transferability |
The Notes are not assignable or transferable. |
| |
|
| Trustee |
U.S. Bank Trust Company, National Association. |
| |
|
| Not Insured or Diversified |
The Notes are not deposits or other bank accounts and are not insured by the Federal Deposit Insurance Corporation or any other insurance or governmental agency. The Notes are not issued by and do not constitute an investment in a money market mutual fund, which is a diversified fund consisting of investments in short-term debt securities of many different issuers. |
RISK FACTORS
Your investment in the Notes involves
certain risks. The Notes are not an appropriate investment for you if you do not understand the terms of the Notes or financial matters
generally. In consultation with your own financial and legal advisers, you should carefully consider, among other matters, the following
risks relating to the Notes, together with the risks and uncertainties discussed under “Forward-Looking Statements” and the
other information included or incorporated by reference in this prospectus, including the information under the heading “Risk Factors”
in our Annual Report on Form 10-K for the year ended May 31, 2021, as such risk factors may be updated from time to time in our Quarterly
Reports on Form 10-Q, our Current Reports on Form 8-K or in any supplement to this prospectus. Any of these risks, as well as other risks
and uncertainties, could harm our financial condition, results of operations or cash flows. You should not purchase Notes unless you understand
and know you can bear all of the investment risks involving the Notes.
CFC’s
Credit Ratings May Not Reflect All Risks of an Investment in the Notes. While the Notes are not specifically rated, certain
of our unsecured debt is rated by Fitch Ratings Inc., Moody’s Investor Service and S&P Global Inc., each of which is designated
as a nationally recognized statistical rating organization by the SEC.
A credit rating reflects an assessment
by the rating agency of the credit risk associated with particular securities we issue, based on information provided by us, and other
sources. Credit ratings are not recommendations to buy, sell or hold securities and are subject to revision or withdrawal at any time
by the assigning rating agency. Each rating agency may have different criteria for evaluating company risk, and therefore ratings should
be evaluated independently for each rating agency. The credit ratings of CFC may not reflect all risks related to the Notes.
The
Interest Rate Paid on the Notes May Not Bear Any Relation to the Investment Risk. The interest rate paid on investments in
the Notes, which is subject to change daily, may not provide a basis for comparison with bank deposits or money market funds, which may
use different methods of calculating yield, or other investments which pay a fixed yield for a stated period of time. The interest rate
also does not necessarily bear any relation to the risks associated with or change in the creditworthiness, credit rating or financial
condition of CFC and may not compensate you for any increase in credit risk of investments in the Notes.
The
Notes Are Not a Diversified Investment. The Notes are not an investment in a money market mutual fund holding diversified investments
in the securities of many companies. Only the assets of CFC that have not been encumbered, sold or securitized are available to pay the
principal of and interest on the Notes. Because the Notes are unsecured debt securities issued by a single issuer, you will not have the
benefits of diversification offered by money market mutual funds or other investment companies. The Notes are not subject to regulation
under the Investment Company Act of 1940, as amended. Consequently, you will not have the benefit of federal laws and regulation designed
to help maintain liquidity and a stable price and set standards for credit quality, diversification and for maturity of individual securities
and the overall portfolio.
CFC
Is Not a Bank, and Investments In the Notes Are Not Insured by the Federal Deposit Insurance Corporation or Any Other Governmental or
Non-Governmental Source. CFC is not a bank and an investment in the Notes does not create a bank account or depositor relationship
between you and CFC. The Notes are not equivalent to a deposit or other bank account and are not subject to the protection of the Federal
Deposit Insurance Corporation regulation or any other insurance. Only CFC is obligated to pay the principal of and interest on the Notes,
and only its otherwise unencumbered assets are available for this purpose. If CFC’s otherwise unencumbered assets are insufficient
to pay the principal of and interest on the Notes, you could lose some or all of your investment. No governmental or non-governmental
source guarantees return of your investment in the event of a failure of CFC to repay your investment.
The
Notes Are Not Transferable. You cannot transfer your investment in the Notes to someone else. As a result, no secondary market
for the Notes currently exists or will ever exist, and, consequently, there is no public market valuation of the Notes to assist investors
in evaluating the Notes or their yield. You may redeem your investment in the Notes at any time in whole or in part as described in this
Prospectus. Same-day redemption is permitted only if CFC receives notice of redemption by 11:00 a.m. Eastern time.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and
current reports and other information with the SEC. Our SEC filings are available to the public at the SEC’s website at http://www.sec.gov.
We have filed with the SEC a registration
statement on Form S-3 under the Securities Act of 1933, as amended (the “Securities Act”), relating to the Notes covered by
this prospectus. The registration statement, including the attached exhibits, contains additional relevant information about us and the
Notes. You may refer to the registration statement and exhibits for more information about the Notes. The registration statement and exhibits
are available through the SEC’s Public Reference Room or website.
INCORPORATION BY REFERENCE
The SEC allows us to “incorporate by
reference” into this prospectus information we have filed separately with the SEC, which means that we can disclose important information
to you by referring you to those filed documents. The information incorporated by reference is an important part of this prospectus, and
the information we subsequently file with the SEC will automatically update and supersede the information in this prospectus. Absent unusual
circumstances, we will have no obligation to amend this prospectus, other than filing subsequent information with the SEC. We incorporate
by reference the documents listed below and any future filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) until the termination of the offering of the Notes:
| · | Current Reports on Form 8-K, dated June 7, 2021 (filed June 10, 2021), June 14, 2021 (filed June 17,
2021), October 15, 2021 (filed October 15, 2021), November 4, 2021 (filed November 8, 2021), November 8, 2021 (filed November 10, 2021),
January 31, 2021 (filed February 7, 2022) and February 23, 2022 (filed February 23, 2022). |
We are not incorporating by reference
any document or information that is deemed to be furnished and not filed in accordance with the SEC rules.
Any statement contained in a document incorporated
or deemed to be incorporated by reference into this prospectus will be deemed to be modified or superseded for purposes of this prospectus
to the extent that a statement contained in this prospectus or any other subsequently filed document that is deemed to be incorporated
by reference into this prospectus modifies or supersedes the statement. Any statement so modified or superseded will not be deemed, except
as so modified or superseded, to constitute a part of this prospectus.
You may request a copy of these
filings from the SEC as described under “Where You Can Find More Information.” You may also request, at no cost, (other than
an exhibit to these filings, or an exhibit to any other filings incorporated by reference into the registration statement, unless we have
incorporated that exhibit by reference into this registration statement) a copy of these filings by writing to or telephoning us at the
following address:
National Rural Utilities Cooperative Finance Corporation
20701 Cooperative Way
Dulles, VA 20166
(703) 467-1800
Attention: Yu Ling Wang, Senior Vice President and Chief
Financial Officer
These filings are also available
through the Financial Reporting subsection of the Investor Relations section of our website: www.nrucfc.coop. Information on our
website does not constitute a part of this prospectus.
FORWARD-LOOKING STATEMENTS
This prospectus, including the information
incorporated by reference herein, contains certain statements that are considered “forward-looking statements” as defined
in and within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements
do not represent historical facts or statements of current conditions. Instead, forward-looking statements represent management’s
current beliefs and expectations, based on certain assumptions and estimates made by, and information available to, management at the
time the statements are made, regarding our future plans, strategies, operations, financial results or other events and developments,
many of which by their nature are inherently uncertain and outside our control. Forward-looking statements are generally identified by
the use of words such as “intend,” “plan,” “may,” “should,” “will,” “project,”
“estimate,” “anticipate,” “believe,” “expect,” “continue,” “potential,”
“opportunity” and similar expressions, whether in the negative or affirmative. All statements about future expectations or
projections, including statements about loan volume, the adequacy of the allowance for credit losses, operating income and expenses, leverage
and debt- to-equity ratios, borrower financial performance, impaired loans, and sources and uses of liquidity, are forward-looking statements.
Although we believe the expectations reflected in our forward-looking statements are based on reasonable assumptions, actual results and
performance may differ materially from our forward-looking statements. Therefore, you should not place undue reliance on any forward-looking
statement and should consider the risks and uncertainties that could cause our current expectations to vary from our forward-looking statements,
including, but not limited to legislative changes that could affect our tax status and other matters, demand for our loan products, lending
competition, changes in the quality or composition of our loan portfolio, changes in our ability to access external financing, changes
in the credit ratings on our debt, valuation of collateral supporting impaired loans, charges associated with our operation or disposition
of foreclosed assets, nonperformance of counterparties to our derivative agreements, economic conditions and regulatory or technological
changes within the rural electric industry, the costs and impact of legal or governmental proceedings involving us or our members, general
economic conditions, governmental monetary and fiscal policies, the occurrence and effect of natural
disasters, including severe weather events or public health emergencies, such as the emergence in 2019 and continued spread of
a novel coronavirus that causes coronavirus disease 2019, and other factors discussed in our annual and quarterly reports previously filed
with the SEC. Forward-looking statements speak only as of the date they are made, and except as required by law, we undertake no obligation
to update any forward-looking statement to reflect the impact of events, circumstances or changes in expectations that arise after the
date any forward-looking statement is made.
THE COMPANY
CFC is a member-owned, nonprofit finance cooperative
association incorporated under the laws of the District of Columbia in April 1969. CFC’s principal purpose is to provide its members
with financing to supplement the loan programs of the Rural Utilities Service of the United States Department of Agriculture. CFC extends
loans to its rural electric members for construction, acquisitions, system and facility repairs and maintenance, enhancements and ongoing
operations to support the goal of electric distribution, generation, and transmission (“power supply”) systems of providing
reliable, affordable power to the customers they service. CFC also provides its members with credit enhancements in the form of letters
of credit and guarantees of debt obligations. As a cooperative, CFC is owned by and exclusively serves its membership, which consists
of not-for-profit entities or subsidiaries or affiliates of not-for-profit entities. CFC is exempt from federal income taxes under Section
501(c)(4) of the Internal Revenue Code. As a member-owned cooperative, CFC’s objective is not to maximize profit, but rather to
offer its members cost-based financial products and services. CFC annually allocates its net earnings, which consist of net income excluding
the effect of certain non-cash accounting entries, to (i) a cooperative educational fund; (ii) a general reserve, if necessary; (iii)
members based on each member’s patronage of CFC’s loan programs during the year; and (iv) a members’ capital reserve.
CFC funds its activities primarily through a combination of public and private issuances of debt securities, member investments and retained
equity. As a Section 501(c)(4) tax- exempt, member-owned cooperative, CFC cannot issue equity securities. The Company’s headquarters
are located at 20701 Cooperative Way, Dulles, VA 20166 and its telephone number is (703) 467-1800.
CFC’s financial statements include the consolidated
accounts of CFC, National Cooperative Services Corporation (“NCSC”), Rural Telephone Finance Cooperative (“RTFC”)
and subsidiaries created and controlled by CFC to hold foreclosed assets resulting from defaulted loans or bankruptcy. CFC and its consolidated
entities have not held any foreclosed assets since the fiscal year ended May 31, 2017.
NCSC is a taxable cooperative incorporated in 1981 in
the District of Columbia as a member-owned cooperative association. The principal purpose of NCSC is to provide financing to its members,
government or quasi-government entities which own electric utility systems that meet the Rural Electrification Act definition of “rural,”
and the for-profit and not-for-profit entities that are owned, operated or controlled by, or provide significant benefit to Class A, B
and C members of CFC. As of November 30, 2021, NCSC’s membership consisted of distribution systems, power supply systems and statewide
and regional associations that were members of CFC. CFC, which is the primary source of funding for NCSC, manages NCSC’s business
operations under a management agreement that is automatically renewable on an annual basis unless terminated by either party. NCSC pays
CFC a fee and, in exchange, CFC reimburses NCSC for loan losses under a guarantee agreement. As a taxable cooperative, NCSC pays income
tax based on its reported taxable income and deductions. NCSC is headquartered with CFC in Dulles, Virginia.
RTFC is a taxable Subchapter T cooperative association
originally incorporated in South Dakota in 1987 and reincorporated as a member-owned cooperative association in the District of Columbia
in 2005. RTFC’s principal purpose is to provide financing for its rural telecommunications members and their affiliates. RTFC’s
membership consists of a combination of not-for-profit and for-profit entities. CFC is the sole lender to and manages RTFC’s business
operations through a management agreement that is automatically renewable on an annual basis unless terminated by either party. RTFC pays
CFC a fee and, in exchange, CFC reimburses RTFC for loan losses under a guarantee agreement. As permitted under Subchapter T of the Internal
Revenue Code, RTFC pays income tax based on its taxable income, excluding patronage-sourced earnings allocated to its patrons. RTFC is
headquartered with CFC in Dulles, Virginia.
At November 30, 2021, after taking
into consideration systems that are members of both CFC and NCSC and eliminating memberships between CFC, RTFC and NCSC, our consolidated
membership totaled 1,425 members and 247 associates. Our consolidated members include 842 electric distribution systems, 67 power supply
systems, 453 telecommunication members, 62 statewide and regional associations, and one national association of cooperatives. The service
territories of our electric distribution systems, power supply systems and telecommunication members are located in 49 states, the District
of Columbia and two U.S. territories.
USE OF PROCEEDS
Unless otherwise specified in a
prospectus supplement, the net proceeds from the sale of the Notes will be added to the general funds of CFC, which will be used to make
loans to members, refinance existing debt and for other corporate purposes. CFC expects to incur additional indebtedness from time to
time, the amount and terms of which will depend upon the volume of its business, general market conditions and other factors.
DESCRIPTION OF CFC DAILY
LIQUIDITY PROGRAM
Any member of CFC, NCSC
or RTFC and certain qualified organizations affiliated with a CFC, NCSC or RTFC member that are eligible to purchase CFC member commercial
paper are eligible to invest in Notes. Rights of participants under CFCs Daily Liquidity Program, the limitations on those rights, and
the provisions of the Daily Liquidity Program are described in the next few pages.
All purchases under the Daily Liquidity Program will
be evidenced under a master note. Confirmations of purchases will be issued to each participant upon purchase. The principal amount of
the purchase, plus interest accrued and unpaid thereon, is recorded on a register maintained by CFC as the participant’s program
account. Current account information can be obtained by calling 1-800-424-2955 or writing to National Rural Utilities Cooperative Finance
Corporation, 20701 Cooperative Way, Dulles, Virginia 20166-6691, Attention: Capital Markets.
The Daily Liquidity Program is not equivalent to
a bank account and is not subject to the protection of the Federal Deposit Insurance Corporation or other insurance. Since all funds under
the Daily Liquidity Program will be received by CFC, participants will not have the advantage of diversification offered by money market
funds and will not have the protection provided by the Investment Company Act of 1940, as amended. The deposits are not and will not be
listed on any securities exchange and there is no secondary market for them.
Interest Rate Information
The interest rate on the Notes will be set by CFC
on a daily basis. When the interest rate changes, CFC will file a pricing supplement with the SEC disclosing the new rate. Interest
will be calculated on a 365-day year. Information on current interest rates can be obtained by calling CFC’s Member Center at
1-800-424-2955 or through CFC’s website at http://www.nrucfc.coop. Interest on an account will accrue on a daily basis.
Interest will be automatically credited to the account monthly, on the second business day following the end of the month.
Participants cannot elect to have interest paid to them monthly. However, amounts may be withdrawn from the account at any time
subject to the $50,000 minimum described below. Interest earned for any given past period under the Daily Liquidity Program is not
an indication or representation of future results.
For purposes of the Daily Liquidity
Program, a “business day” is a day on which both the Federal Reserve Bank of New York and CFC are open for business.
Program Enrollment
CFC, NCSC and RTFC members and certain qualified organizations
affiliated with a CFC, NCSC or RTFC member that are eligible to purchase member commercial paper who are currently enrolled as participants
in CFC’s commercial paper program are automatically enrolled to participate in the Daily Liquidity Program. Members and qualified
organizations who are not already established as CFC member commercial paper investors may register to participate in the Daily Liquidity
Program by completing a “CFC Investor Background Data” form. This form may be obtained by contacting the CFC Member Center
at 1-800-424-2955.
How to Make a Purchase
The aggregate principal amount of Notes outstanding under
the Daily Liquidity Program at any one time shall not exceed $3 billion. Subject to this restriction, purchases under the Daily Liquidity
Program may be made at any time, without charge, by wire transfer or by such other means as CFC shall from time to time determine. The
minimum initial amount which participants may purchase under the Daily Liquidity Program is $50,000. The minimum amount for subsequent
purchases is $50,000. A minimum balance of $50,000 must be maintained in each program account at all times. All purchases must be made
in U.S. dollars. Program accounts may be opened only by CFC member or affiliate entities. Attempts to make a purchase through methods
not authorized by CFC are not permitted.
The wire transfer routing code for CFC’s Daily
Liquidity Program account and other instructions will be provided to participants. Funds received and accepted by CFC on a business day
prior to 5:00 pm Eastern time will be credited to the participant’s account on that day. Funds received and accepted after 5:00
pm Eastern time on a business day are credited to the participant’s account on the next business day. Interest will begin to accrue
on the business day the purchase is credited to the participant’s account. CFC is not responsible for delays in the transfer and
wiring of funds.
How to Make Withdrawals/Liquidations
A participant may make a withdrawal at any time, without
fees or penalties, subject to a $50,000 minimum. A participant may liquidate its account at any time, without fees or penalties. Requests
for withdrawals by wire transfer may be initiated by telephoning the CFC Member Center (1-800-424-2955) or making an on-line request in
accordance with instructions from CFC. Requests for account liquidation by wire transfer shall be made as set forth below under “Withdrawals/Liquidation
by Wire Transfer.” Participants liquidating their holdings and closing their program account will receive all accrued and unpaid
interest.
Withdrawals/Liquidations by Wire Transfer
Participants may arrange to have withdrawal or
liquidation proceeds of $50,000 or more wire transferred to a pre- designated bank account. If the withdrawal or liquidation
request, in proper form, is received by CFC before 11:00 a.m. Eastern Time on a business day, proceeds will normally be wired to the
pre-designated bank account on that business day. Withdrawal or liquidation proceeds will normally be wired to the pre-designated
bank account on the next business day if the withdrawal or liquidation request, in proper form, was received by CFC after 11:00 a.m.
Eastern Time. Interest accrues to, but does not include, the business day the proceeds are wired.
Withdrawal or liquidation
instructions must include the name of the program (CFC Daily Liquidity Program), the participant’s name, the
participant’s alphanumeric ID number for the program, the routing code of the pre-designated bank, and the participant’s
account number at the pre-designated bank. Withdrawal or liquidation instructions may be given by telephoning the CFC Member Center
at 1-800-424-2955. The pre-designated bank may be changed only on written request to CFC by an authorized officer. CFC is not
responsible for delays resulting in problems in the Federal Reserve Fedwire Funds Service system or problems with the funds transfer
systems of member banks. CFC will not be responsible for the authenticity of withdrawal or liquidation instructions. Withdrawals or
liquidations will be sent to a pre-designated account at a bank that is a member of the Federal Reserve Fedwire Funds Service
system, or to a correspondent bank of the pre-designated bank if the pre-designated bank is not a member of the Federal Reserve
Fedwire Funds Service system. If the correspondent bank fails to notify the pre-designated bank immediately, there may be a delay in
crediting the funds to the pre-designated bank account. The procedures permitting withdrawals or liquidations by wire may be
modified, terminated, or suspended at any time by CFC.
The Indenture
The Notes will be issued under an indenture dated as
of May 15, 2000, as supplemented on March 12, 2007, between CFC and U.S. Bank Trust Company, National Association, as successor Trustee
(the “Indenture”). Statements herein relating to the Daily Liquidity Program are qualified in their entirety by reference
to the Indenture incorporated by reference as exhibits to this Registration Statement.
Optional Redemptions by CFC
The Indenture provides that the Notes are subject to
partial or full redemption at any time at the option of CFC. Notice of redemption will be given by CFC to holders at least 30 days, but
not more than 90 days, prior to the redemption date. The full or partial redemption of the Notes, plus accrued and unpaid interest thereon
to the redemption date, will be paid by wire transfer to participants whose Notes are being redeemed.
Merger, Consolidation and Sale of Assets
The Indenture provides that CFC will not merge or consolidate
with another corporation or transfer its assets substantially as an entity to any person unless:
| · | the successor is a corporation organized under the laws of any domestic jurisdiction, |
| · | the successor corporation assumes CFC’s obligations under the indenture and the Notes issued under
the indenture, |
| · | immediately after giving effect to the transaction, no event of default and no event that, after notice
or lapse of time, or both, would become an event of default, has occurred and is continuing, and |
| · | CFC shall have delivered to the trustee an officer’s certificate and an opinion of counsel, each
stating that such consolidation, merger, conveyance or transfer and, if a supplemental indenture is required in connection with such a
transaction, such supplemental indenture complies with the Indenture and all conditions precedent relating to such transaction have been
complied with. |
Events of Default
The following events are defined in the Indenture as “events
of default”:
| · | CFC’s failure to pay all or any part of the principal or interest when due and such failure to
pay continues for 20 days, |
| · | CFC’s failure to perform or observe any other covenants or agreements in the indenture or the
daily liquidity program for 90 days after notice, and |
| · | events of bankruptcy, insolvency or reorganization of CFC. |
If an event of default occurs and is continuing, then
the trustee or the holders of not less than 50% in aggregate principal amount of outstanding Notes may declare all of the Notes due and
payable immediately.
The Indenture provides that the trustee shall,
within 90 days after the occurrence of an event of default, give notice of all uncured defaults known to it (the term default to
include the events specified above without grace periods). However, except in the case of default in the payment of principal or
interest on any of the Notes, the trustee may withhold such notice if it in good faith determines that the withholding of notice is
in the interests of the Noteholders.
CFC is required to furnish to the trustee annually a
statement of officers of CFC stating whether or not to their knowledge CFC is in default in the performance of the terms of the Indenture
and, if CFC is in default, specifying each such default.
The holders of a majority in aggregate principal amount
of all outstanding Notes have the right to waive certain defaults and, subject to limitations, to direct the time, method and place of
conducting any proceedings for any remedy available to the trustee or exercising any trust or power conferred on the trustee. If an event
of default occurs, the trustee must exercise those rights and powers, and use the degree of care and skill in their exercise, that a prudent
person would exercise or use in the conduct of his or her own affairs, but otherwise need only perform the duties specifically set forth
in the indenture. The trustee is under no obligation to exercise any of its rights or powers at the request of the Noteholders unless
they have offered to the trustee reasonable security or indemnity.
Modification of the Indenture
Under the Indenture, CFC’s rights and obligations
and the rights and obligations of the holders may be modified by CFC with the consent of the holders of at least a majority in principal
amount of the Notes then outstanding. No such modifications may be made without the consent of the holders of all Notes then outstanding
which would:
| · | diminish the principal amount of any Note, or accrued and unpaid interest thereon, or |
| · | reduce the stated percentage of Notes, the consent of the holders of which is required to modify or
alter the Indenture. |
Concerning the Trustee
An affiliate of U.S. Bank Trust Company, National Association,
the successor trustee under the Indenture, has from time to time agreed to make loans to CFC and has performed other services for CFC
in the normal course of its business.
Termination, Suspension or Modification of Program
CFC expects that the Daily Liquidity Program will continue
for the foreseeable future, but reserves the right at any time to terminate, suspend or modify the Daily Liquidity Program in part or
in its entirety. CFC may, in its discretion, temporarily suspend the acceptance of new balances without the suspension constituting a
suspension or termination of the Daily Liquidity Program. Any modification that affects the rights or duties of the trustee may be made
only with the consent of the trustee. No termination, modification or suspension may affect the right of a member to redeem amounts credited
to the account or diminish the amounts credited thereto as of the effective date of the action.
Rights Not Transferable
No right or interest in or to
a Note is assignable or transferable and no attempted assignment or transfer will be effective.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuous basis for
sale by CFC directly on its behalf and no commissions will be paid. CFC may from time to time designate offered agents in certain jurisdictions
through whom Notes may be offered. These agents will receive no commissions but may be reimbursed for expenses incurred in connection
with their efforts. CFC reserves the right to withdraw, cancel or modify the offer to purchase Notes at any time. CFC has the sole right
to accept offers to purchase Notes and may reject any proposed purchase of Notes in whole or in part.
LEGAL OPINIONS
The validity of the Notes offered hereby will be passed
upon for CFC by Hogan Lovells US LLP, Washington, D.C.
EXPERTS
The consolidated financial statements of National
Rural Utilities Cooperative Finance Corporation as of May 31, 2021 and 2020, and for each of the years in the three-year period ended
May 31, 2021, have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting
firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses
in connection with the offering described in this registration statement:
| Registration statement filing fee | |
$ | - | |
| Legal fees and expenses | |
| 30,000 | |
| Accountants’ fees | |
| 15,000 | |
| Blue sky fees and expenses | |
| 10,000 | |
| Fees of trustee | |
| 10,000 | |
| Total | |
$ | 65,000 | |
Item 15. Indemnification of Directors and Officers.
The bylaws of CFC provide for indemnification of all
CFC directors, officers and employees to the fullest extent authorized by law, as the law exists or may change (to the extent such changes
broaden the indemnification rights of indemnitees).
Section 29-306.51 of the District
of Columbia Business Organizations Code (the “Business Organizations Code”) provides that a corporation may indemnify a director
if the director:
“(1)(A) Conducted himself
or herself in good faith; (B) reasonably believed: (i) in the case of conduct in an official capacity, that his or her conduct was in
the best interests of the corporation; and (ii) in all other cases, that the director’s conduct was at least not opposed to the
best interests of the corporation; and (C) in the case of any criminal proceeding, had no reasonable cause to believe his or her conduct
was unlawful; or (2) engaged in conduct for which broader indemnification has been made permissible or obligatory under a provision of
the articles of incorporation.”
Furthermore, Section
29-306.56 of the Business Organizations Code permits a corporation to indemnify an officer:
“(1) to the same extent as a
director; and (2) if he or she is an officer but not a director, to such further extent as may be provided by the articles of
incorporation, the bylaws, a resolution of the board of directors, or contract, except for liability (A) in connection with a
proceeding by or in the right of the corporation other than for expenses incurred in connection with the proceeding; or (B) arising
out of conduct that constitutes: (i) receipt by the officer of a financial benefit to which the officer is not entitled; (ii) an
intentional infliction of harm on the corporation or the shareholders; or (iii) an intentional violation of criminal law.”
Subsection (2) in the immediately preceding paragraph
applies to an officer who is also a director if the basis on which the officer is made a party to the proceeding is an act or omission
solely as an officer.
An officer who is not a director shall be entitled to mandatory
indemnification under the Business Organizations Code and may apply to the Superior Court for indemnification or an advance for expenses,
in each case to the same extent to which a director may be entitled to indemnification or advance for expenses under the applicable provisions
of the Business Organizations Code.
Item 16. Exhibits.
| Exhibit No. | |
Description |
| | |
|
| Exhibit 4.1 | |
Form of Indenture dated as of May 15, 2000 between CFC and Bank One Trust Company, National Association, as Trustee. Incorporated by reference to Exhibit 4.1 to CFC’s Registration Statement on Form S-3 filed on May 25, 2000 (Registration Statement No. 333-37940). |
| | |
|
| Exhibit 4.2 | |
First Supplemental Indenture dated as of March 12, 2007 by and among CFC, U.S. Bank National Association, as Successor Trustee, and The Bank of New York Trust Company, N.A., as Resigning Trustee. Incorporated by reference to Exhibit 4.2 to CFC’s Registration Statement on Form S-3 filed on April 19, 2007 (Registration Statement No. 333-142230). |
| | |
|
| Exhibit 4.3 | |
Form of Variable Denomination Floating Rate Demand Note. Incorporated by reference to Exhibit 4.3 to CFC’s Registration Statement on Form S-3 filed on April 19, 2007 (Registration Statement No. 333-142230). |
| | |
|
| Exhibit 5.1 | |
Opinion of Hogan Lovells US LLP, as to the legality of the Notes. |
| | |
|
| Exhibit 23.1 | |
Consent of KPMG LLP. |
| | |
|
| Exhibit 23.3 | |
Consent of Hogan Lovells US LLP (included as part of Exhibit 5.1). |
| | |
|
| Exhibit 24.1 | |
Powers of Attorney (included in signature pages of this Registration Statement). |
| | |
|
| Exhibit 25.1 | |
Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of U.S. Bank Trust Company, National Association, as Successor Trustee. |
| | |
|
| Exhibit 107 | |
Filing Fee Table. |
Item 17. Undertakings.
(a)
The undersigned registrant hereby undertakes:
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this
registration statement: |
| (i) | To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933. |
| (ii) | To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective
registration statement; and |
| (iii) | To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any material change to such information in the registration
statement; |
Provided,
however, that:
Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not
apply if the registration statement is on Form S-3, and the information required to be included in a post-effective amendment by those
paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of
prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at
the termination of the offering.
(4)
That, for purposes of determining any liability under the Securities Act of 1933 to any purchaser:
| (i) | If the registrant is relying on Rule 430B: |
(A)
Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as
of the date the filed prospectus was deemed part of and included in the registration statement; and
(B) Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on
Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information
required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as
of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any
person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement
relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a
registration statement or prospectus that is a part of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus that is a part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the
registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to
such effective date.
(5)
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities:
The undersigned registrant undertakes that in a primary
offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used
to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications,
the undersigned registrant will be seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
| (i) | Any preliminary prospectus or prospectus of the undersigned
registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | any free writing prospectus relating to the offering prepared
by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to
the offering containing material information about the undersigned registrant or their securities provided by or on behalf of the undersigned
registrant; and |
| (iv) | Any other communication that is an offer in the offering made
by the undersigned registrant to the purchaser. |
(b)
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933,
each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c)
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of CFC pursuant to the provisions described under Item 15 above, or otherwise, CFC has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by CFC of expenses incurred or paid by
a director, officer or controlling person of CFC in the successful defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being registered, CFC will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of
the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized,
in the County of Loudoun, Commonwealth of Virginia, on the 25th day of March 2022.
| |
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION |
| |
|
| |
|
| |
|
/s/ J. ANDREW DON |
| |
By: |
J. Andrew Don |
| |
|
Chief Executive Officer |
POWER OF ATTORNEY
The registrant and each person
whose original signature appears below hereby authorize each of J. Andrew Don and Yu Ling Wang (the “Agents”) to file one
or more amendments (including post- effective amendments) to the registration statement, which amendments may make such changes in the
registration statement as such Agent deems appropriate, and the registrant and each such person hereby appoints each such Agent as attorney-in-fact
to execute in the name and on behalf of the registrant and each such person, individually and in each capacity stated below, any such
amendments to the registration statement.
Pursuant to the requirements
of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities
indicated on March 25, 2022.
| |
Signature | |
Title |
| |
| |
|
| |
/S/ J. ANDREW DON | |
|
| |
J. Andrew Don | |
Chief Executive Officer |
| |
| |
|
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/S/ YU LING WANG | |
|
| |
Yu Ling Wang | |
Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
| |
| |
|
| |
/S/ ROBERT E. GEIER | |
|
| |
Robert E. Geier | |
Vice President and Chief Accounting Officer (Principal Accounting Officer) |
| |
| |
|
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/S/ ALAN W. WATTLES | |
|
| |
Alan W. Wattles | |
President and Director |
| |
| |
|
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/S/ BRUCE A. VITOSH | |
|
| |
Bruce A. Vitosh | |
Vice President and Director |
| |
| |
|
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/S/ DAVID E. FELKEL | |
|
| |
David E. Felkel | |
Secretary-Treasurer and Director |
| |
| |
|
| |
/S/ ANTHONY A. ANDERSON | |
|
| |
Anthony A. Anderson | |
Director |
| |
Signature | |
Title |
| |
| |
|
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/S/ THOMAS A. BAILEY | |
|
| |
Thomas A. Bailey | |
Director |
| |
| |
|
| |
/S/ KEVIN M. BENDER | |
|
| |
Kevin M. Bender | |
Director |
| |
| |
|
| |
| |
|
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/S/ ROBERT BROCKMAN | |
|
| |
Robert Brockman | |
Director |
| |
| |
|
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/S/ CHRIS D. CHRISTENSEN | |
|
| |
Chris D. Christensen | |
Director |
| |
| |
|
| |
/S/ JARED ECHTERNACH | |
|
| |
Jared Echternach | |
Director |
| |
| |
|
| |
/S/ TIMOTHY ELDRIDGE | |
|
| |
Timothy Eldridge | |
Director |
| |
| |
|
| |
/S/ DENNIS FULK | |
|
| |
Dennis Fulk | |
Director |
| |
| |
|
| |
/S/ BARBARA E. HAMPTON | |
|
| |
Barbara E. Hampton | |
Director |
| |
| |
|
| |
/S/ WILLIAM KEITH HAYWARD | |
|
| |
William Keith Hayward | |
Director |
| |
| |
|
| |
/S/ MICHAEL HEINEN | |
|
| |
Michael Heinen | |
Director |
| |
| |
|
| |
/S/ BRADLEY P. JANORSCHKE | |
|
| |
Bradley P. Janorschke | |
Director |
| |
| |
|
| |
/S/ ANTHONY LARSON | |
|
| |
Anthony Larson | |
Director |
| |
| |
|
| |
/S/ BRENT MCRAE | |
|
| |
Brent McRae | |
Director |
| |
| |
|
| |
/S/ JOHN METCALF | |
|
| |
John Metcalf | |
Director |
| |
| |
|
| |
/S/ KENDALL MONTGOMERY | |
|
| |
Kendall Montgomery | |
Director |
| |
| |
|
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/S/ G. ANTHONY NORTON | |
|
| |
G. Anthony Norton | |
Director |
| |
| |
|
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/S/ JEFFREY ALLEN REHDER | |
|
| |
Jeffrey Allen Rehder | |
Director |
| |
| |
|
| |
/S/ MARK A. SUGGS | |
|
| |
Mark A. Suggs | |
Director |
| |
| |
|
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/S/ MARSHA L. THOMPSON | |
|
| |
Marsha L. Thompson | |
Director |
