Gladstone Land Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Borrowings (Tables)

Borrowings (Tables)

12 Months Ended

Dec. 31, 2018

Our borrowings as of December 31, 2018 and 2017 are summarized below (dollars in thousands):



	Carrying Value as of						As of December 31, 2018
	December 31, 2018			December 31, 2017			Stated Interest Rates⁽¹⁾ (Range; Wtd Avg)	Maturity Dates (Range; Wtd Avg)
Notes and bonds payable:
Fixed-rate notes payable	$	247,249		$	208,469		3.16%–5.70%; 3.96%	6/1/2020–12/1/2043; December 2031
Fixed-rate bonds payable	90,877			84,519			2.80%–4.57%; 3.55%	12/11/2019–9/13/2028; November 2022
Total notes and bonds payable	338,126			292,988
Debt issuance costs – notes and bonds payable	(2,338		)	(1,986		)	N/A	N/A
Notes and bonds payable, net	$	335,788		$	291,002

Variable-rate revolving lines of credit	$	100		$	10,000		4.66%	4/5/2024

Total borrowings, net	$	335,888		$	301,002


⁽¹⁾	Where applicable, stated interest rates are before interest patronage (as described below).

Schedule of Aggregate Maturities

Scheduled principal payments of our aggregate notes and bonds payable as of December 31, 2018, for the succeeding years are as follows (dollars in thousands):



For the Fiscal Years Ending December 31,	Scheduled Principal Payments
2019	$	12,374
2020	28,151
2021	16,174
2022	38,612
2023	32,385
Thereafter	210,429
	$	338,126

MetLife Credit Facility

Summary of Borrowings

The following table summarizes the pertinent terms of the MetLife Facility as of December 31, 2018 (dollars in thousands, except for footnotes):

Issuance

Aggregate

Commitment

Maturity

Dates

Principal

Outstanding

Interest Rate Terms

Undrawn

Commitment

MetLife Term Notes

200,000

⁽¹⁾

1/5/2029

126,658

3.30%, fixed through 1/4/2027

⁽²⁾

63,530

⁽³⁾

MetLife Lines of Credit

75,000

4/5/2024

100

3-month LIBOR + 2.25%

⁽⁴⁾

74,900

⁽³⁾

Total principal outstanding

126,758


⁽¹⁾	If the aggregate commitment under this facility is not fully utilized by December 31, 2019, MetLife has the option to be relieved of its obligations to disburse the additional funds under the MetLife Term Notes.

⁽²⁾

Represents the blended interest rate as of December 31, 2018. Interest rates for subsequent disbursements will be based on then-prevailing market rates. The interest rate on all then-outstanding disbursements will be subject to adjustment on January 5, 2027. Through December 31, 2019, the MetLife Term Notes are also subject to an unused fee ranging from 0.10% to 0.20% on undrawn amounts (based on the balance drawn under the notes).


⁽³⁾	Based on the properties that were pledged as collateral under the MetLife Facility, as of December 31, 2018, the maximum additional amount we could draw under the facility was approximately $18.1 million.


⁽⁴⁾	The interest rate on the MetLife Lines of Credit is subject to a minimum annualized rate of 2.50%, plus an unused fee ranging from 0.10% to 0.20% on undrawn amounts (based on the balance drawn under each line of credit). The interest rate spread will be subject to adjustment on October 5, 2019. As of December 31, 2018, the interest rate on the MetLife Lines of Credit was 4.66%

Individual Metlife Notes

Summary of Borrowings

MetLife (collectively, the “Individual MetLife Notes”), as of December 31, 2018 (dollars in thousands):



Date of Issuance	Amount	Maturity Date	Principal Amortization	Interest Rate Terms
5/31/2017	$14,765	2/14/2022 & 2/14/2025	28.6 years	3.55% & 3.85%, fixed throughout their respective terms

Farm Credit West notes payable

Summary of Borrowings

During the year ended December 31, 2018, we entered into the following loan agreements with Farm Credit (dollars in thousands):

Issuer

Date of

Issuance

Amount⁽¹⁾

Maturity

Date

Principal

Amortization

Stated Interest Rate Terms⁽²⁾

Farm Credit West

4/11/2018

1,473

5/1/2038

20.5 years

4.99%, fixed through April 30, 2023 (variable thereafter)

Farm Credit FL

7/12/2018

16,850

8/1/2043

25.0 years

5.38%, fixed through July 31, 2025 (variable thereafter)

Farm Credit FL

7/17/2018

5,560

8/1/2043

25.0 years

5.38%, fixed through July 31, 2025 (variable thereafter)

SWGA Farm Credit

9/6/2018

1,560

10/1/2043

25.0 years

5.06%, fixed through October 1, 2023 (variable thereafter)

Farm Credit West

11/1/2018

13,800

11/1/2043

25.0 years

5.61%, fixed through October 31, 2028 (variable thereafter)

Plains Land Bank

11/20/2018

5,280

12/1/2043

25.0 years

5.40%, fixed through November 30, 2023 (variable thereafter)


⁽¹⁾	Proceeds from these notes were used to fund new acquisitions, to repay existing indebtedness, and for other general corporate purposes.


⁽²⁾	Stated interest rate is before interest patronage, as discussed below.

Farm Credit Notes Payable

Summary of Borrowings

The following table summarizes, in the aggregate, the pertinent terms of the loans outstanding from Farm Credit (collectively, the “Farm Credit Notes Payable”) as of December 31, 2018 (dollars in thousands, except for footnotes):



Issuer	# of Loans Outstanding	Dates of Issuance	Maturity Dates	Principal Outstanding		Stated Interest Rate⁽¹⁾
Farm Credit CFL	7	9/19/2014 – 7/13/2017	6/1/2020 – 10/1/2040	$	23,884	4.29%	⁽²⁾
Farm Credit West	6	4/4/2016 – 11/1/2018	5/1/2037 – 11/1/2043	38,741		4.62%	⁽³⁾
CF Farm Credit	1	6/14/2017	7/1/2022	1,270		4.41%	⁽⁴⁾
Farm Credit FL	3	8/9/2017 – 7/17/2018	3/1/2037 – 8/1/2043	28,042		5.24%	⁽⁵⁾
NW Farm Credit	1	9/8/2017	9/1/2024	5,236		4.41%	⁽⁶⁾
SWGA Farm Credit	1	9/6/2018	10/1/2043	1,560		5.06%	⁽⁷⁾
Plains Land Bank	1	11/20/2018	12/1/2043	5,280		5.40%	⁽⁷⁾
Total	20			$	104,013


⁽¹⁾	Where applicable, represents the weighted-average, blended rate (before interest patronage, as discussed below) on the respective borrowings as of December 31, 2018.

⁽²⁾

During the year ended December 31, 2018, we received interest patronage of approximately $142,000 related to interest accrued on loans from Farm Credit CFL during the year ended December 31, 2017, which resulted in a 15.1% reduction (approximately 58 basis points) to the stated interest rates on such borrowings. During the year ended December 31, 2017, we received interest patronage related to loans from Farm Credit CFL of approximately $124,000.

⁽³⁾

During the year ended December 31, 2018, we received interest patronage of approximately $126,000 related to interest accrued on loans from Farm Credit West during the year ended December 31, 2017, which resulted in a 19.7% reduction (approximately 75 basis points) to the stated interest rates on such borrowings. During the year ended December 31, 2017, we received interest patronage related to loans from Farm Credit West of approximately $59,000.

⁽⁴⁾

During the year ended December 31, 2018, we received interest patronage of approximately $11,000 related to interest accrued on loans from CF Farm Credit during the year ended December 31, 2017, which resulted in a 36.6% reduction (approximately 161 basis points) to the stated interest rates on such borrowings. In addition, during the year ended December 31, 2018, we received interest patronage of approximately $14,000 from CF Farm Credit, which was an early payment of a portion of the estimated patronage to be paid out during 2019 related to interest accrued on loans from CF Farm Credit during the year ended December 31, 2018. We did not receive any interest patronage related to loans from CF Farm Credit prior to 2018.

⁽⁵⁾

During the year ended December 31, 2018, we received interest patronage of approximately $27,000 related to interest accrued on loans from Farm Credit FL during the year ended December 31, 2017, which resulted in a 24.6% reduction (approximately 115 basis points) to the stated interest rates on such borrowings. We did not receive any interest patronage related to loans from Farm Credit FL prior to 2018.


⁽⁶⁾	In February 2018, we received interest patronage of approximately $17,000 related to interest accrued on loans from NW Farm Credit during the year ended December 31, 2017, which resulted in a 22.7% reduction (approximately 100 basis points) to the stated interest rates on such borrowings. We did not receive any patronage related to loans from NW Farm Credit prior to 2018.


⁽⁷⁾	To date, no interest patronage has been received or recorded for these loans, as they were not outstanding during 2017.

Farmer Mac Facility

Summary of Borrowings

During the year ended December 31, 2018, we issued four bonds under the Farmer Mac Facility, the pertinent terms of which are summarized in the table below (dollars in thousands):



Dates of Issuance	Gross Proceeds			Maturity Dates	Principal Amortization	Interest Rate Terms
3/13/2018	$	1,260	⁽¹⁾	3/13/2028	None	4.47%, fixed throughout its term
7/30/2018	10,356		⁽²⁾	7/24/2025	None	4.45%, fixed throughout its term
8/17/2018	7,050		⁽²⁾	8/17/2021	None	4.06%, fixed throughout its term
9/13/2018	4,110			9/13/2028	96.9 years	4.57%, fixed throughout its term


⁽¹⁾	Except as noted, proceeds from these bonds were used to repay existing indebtedness and for the acquisitions of new farms.


⁽²⁾	Proceeds from the issuance of these bonds were used to repay three bonds totaling approximately $16.0 million that matured during the year ended December 31, 2018. The additional proceeds received of approximately $1.4 million were a result of appreciation in the value of the underlying collateral since the time of the original bond issuances and were used for general corporate purposes.

The following table summarizes, in the aggregate, the terms of the 16 bonds outstanding under the Farmer Mac Facility as of December 31, 2018 (dollars in thousands):



Dates of Issuance	Initial Commitment			Maturity Dates	Principal Outstanding		Stated Interest Rate⁽¹⁾	Undrawn Commitment
12/11/2014–9/13/2018	$	125,000	⁽²⁾	12/11/2019 – 9/13/2028	$	90,877	3.55%	$	16,342	⁽²⁾


⁽¹⁾	Represents the weighted-average interest rate as of December 31, 2018.


⁽²⁾	As of December 31, 2018, the period during which we were able to issue bonds under the facility had expired, and Farmer Mac had no obligation to purchase additional bonds under the facility.

Rabo AgriFinance, LLC

Schedule of Borrowings by Type

The following table summarizes the pertinent terms of our loan agreement with Rabo as of December 31, 2018 (dollars in thousands):



Date of Issuance	Maturity Date	Principal Outstanding	Principal Amortization	Stated Interest Rate	Interest Rate Terms
10/13/2017	10/1/2022	$518	25.0 years	4.59%	Fixed throughout its term

Diversified Financial Services, LLC

Schedule of Borrowings by Type

The following table summarizes the pertinent terms of our loan agreement with Diversified Financial as of December 31, 2018 (dollars in thousands):



Date of Issuance	Maturity Date	Principal Outstanding	Principal Amortization	Stated Interest Rate	Interest Rate Terms
12/3/2018⁽¹⁾	11/27/2025	$1,295	7.0 years	5.70%	Fixed throughout its term


⁽¹⁾	This loan was issued in two separate disbursements: approximately $688,000 was disbursed on December 3, 2018, and approximately $607,000 was disbursed on December 20, 2018.