(2)

Investment Securities

Our investment securities consist of Federal Agricultural Mortgage Corporation Series A preferred stock with a cost basis of $30 million and fair value of $27 million and $29 million at February 28, 2014 and May 31, 2013, respectively, and an unrealized loss of $3 million and $1 million, respectively, recorded in accumulated other comprehensive income on the condensed consolidated balance sheet. The investment has been in a continuous unrealized loss position for less than twelve months, primarily due to the increase in interest rates. We do not intend to sell this investment in the foreseeable future and we currently expect to fully recover our cost. Our investment in this Series A preferred stock is classified as available-for-sale and therefore recorded in the condensed consolidated balance sheets at fair value.

Our investments also include Federal Agricultural Mortgage Corporation Class A common stock with a cost basis of $0.5 million and a fair value of $2.1 million and $2.2 million at February 28, 2014 and May 31, 2013, respectively, and an unrealized gain of $1.6 million and $1.7 million, respectively, recorded in accumulated other comprehensive income on the condensed consolidated balance sheet. Our investment in this Class A common stock is classified as available-for-sale and therefore recorded in the condensed consolidated balance sheets at fair value.