Fannie Mae 2010 Annual Report Download - page 145

Table 36: Contractual Obligations
Total
Less than
1 Year
1toG3
Years
3to5
Years
More than
5 Years
Payment Due by Period as of December 31, 2010
(Dollars in millions)
Long-term debt obligations
(1)
. . . . . . . . . . . . . . . . . . . . . . $628,160 $ 97,245 $273,191 $138,446 $119,278
Contractual interest on long-term debt obligations
(2)
. . . . . . 95,358 14,718 23,769 15,622 41,249
Operating lease obligations
(3)
...................... 158 40 61 31 26
Purchase obligations:
Mortgage commitments
(4)
. . . . . . . . . . . . . . . . . . . . . . 54,858 54,837 21 — —
Other purchase obligations
(5)
.................... 274 106 163 5 —
Other long-term liabilities reflected in the consolidated
balance sheet
(6)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,087 862 156 37 32
Total contractual obligations . . . . . . . . . . . . . . . . . . . . . . $779,895 $167,808 $297,361 $154,141 $160,585
(1)
Represents the carrying amount of our long-term debt assuming payments are made in full at maturity. Amounts
exclude $2.4 trillion in long-term debt from consolidations. Amounts include unamortized net discount and other cost
basis adjustments of $12.4 billion.
(2)
Excludes contractual interest on long-term debt from consolidations.
(3)
Includes certain premises and equipment leases.
(4)
Includes on- and off-balance sheet commitments to purchase mortgage loans and mortgage-related securities.
(5)
Includes only unconditional purchase obligations that are subject to a cancellation penalty for certain telecom services,
software and computer services, and other agreements. Excludes arrangements that may be cancelled without penalty.
Amounts also include off-balance sheet commitments for the unutilized portion of lending agreements entered into
with multifamily borrowers.
(6)
Excludes risk management derivative transactions that may require cash settlement in future periods and our
obligations to stand ready to perform under our guarantees relating to Fannie Mae MBS and other financial guarantees,
because the amount and timing of payments under these arrangements are generally contingent upon the occurrence of
future events. For a description of the amount of our on- and off-balance sheet Fannie Mae MBS and other financial
guarantees as of December 31, 2010, see “Off-Balance Sheet Arrangements.” Includes future cash payments due under
our contractual obligations to fund LIHTC and other partnerships that are unconditional and legally binding and cash
received as collateral from derivative counterparties, which are included in our consolidated balance sheets under
“Other liabilities.”
Equity Funding
As a result of the covenants under the senior preferred stock purchase agreement and Treasury’s ownership of
the warrant to purchase up to 79.9% of the total shares of our common stock outstanding, we no longer have
access to equity funding except through draws under the senior preferred stock purchase agreement. For a
description of the covenants under the senior preferred stock purchase agreement, see “Business—
Conservatorship and Treasury Agreements—Treasury Agreements—Covenants Under Treasury Agreements.”
We discuss our funding under the senior preferred stock purchase agreement below in “Liquidity and Capital
Management—Capital Management—Capital Activity—Senior Preferred Stock Purchase Agreement.”
Liquidity Risk Management Practices and Contingency Planning
Our liquidity position could be adversely affected by many causes, both internal and external to our business,
including: actions taken by the conservator, the Federal Reserve, Treasury or other government agencies;
legislation relating to us or our business; an unexpected systemic event leading to the withdrawal of liquidity
from the market; an extreme market-wide widening of credit spreads; public statements by key policy makers;
a downgrade of our or the U.S. government’s credit ratings from the major ratings organizations; a significant
further decline in our net worth; loss of demand for our debt, or certain types of our debt, from a major group
of investors; a significant credit event involving one of our major institutional counterparties; a sudden
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