Fannie Mae 2009 Annual Report Download - page 360

were $1.0 billion and $503 million, respectively. There were no dividends declared or paid on preferred stock
(other than the senior preferred stock) for the year ended December 31, 2009.
After a specified period, we have the option to redeem preferred stock (other than the senior preferred stock)
at its redemption price plus the dividend (whether or not declared) for the then-current period accrued to, but
excluding, the date of redemption. The redemption price is equal to the stated value for all issues of preferred
stock except Series O, which has a redemption price of $50 to $52.50 depending on the year of redemption,
Convertible Series 2004-1, which has a redemption price of $105,000 per share, and Mandatory Convertible
Series 2008-1 which is not redeemable.
All of our preferred stock, except those of Series D, E, O, the Convertible Series 2004-1 and the senior
preferred stock, is listed on the New York Stock Exchange.
Issuance of Preferred Stock
On May 14, 2008, we received gross proceeds of $2.6 billion from the issuance of 52 million shares of 8.75%
Non-Cumulative Mandatory Convertible Preferred Stock, Series 2008-1, with a stated value of $50 per share.
Each share has a liquidation preference equal to its stated value of $50 per share plus an amount equal to the
dividend for the then-current quarterly dividend period. The Mandatory Convertible Series 2008-1 Preferred
Stock is not redeemable by us. On May 13, 2011, the mandatory conversion date, each share of the Preferred
Stock will automatically convert into between 1.5408 and 1.8182 shares of our common stock, subject to anti-
dilution adjustments, depending on the average of the closing prices per share of our common stock for each
of the 20 consecutive trading days ending on the third trading day prior to such date. At any time prior to the
mandatory conversion date, holders may elect to convert each share of our Preferred Stock into a minimum of
1.5408 shares of common stock, subject to anti-dilution adjustments. The Mandatory Convertible
Series 2008-1 shares are considered participating securities for purposes of calculating earnings per share.
On May 19, 2008, we received gross proceeds of $2.0 billion from the issuance of 80 million shares of 8.25%
Non-Cumulative Preferred Stock, Series T, with a stated value of $25 per share. Subsequent to the initial
issuance, we received gross proceeds of $200 million from the additional issuance of 8 million shares on
May 22, 2008 and $25 million from the additional issuance of one million shares on June 4, 2008. Each share
has a liquidation preference equal to its stated value of $25 per share plus accrued dividends for the then-
current quarterly dividend period. The Series T Preferred Stock may be redeemed, at our option, on or after
May 20, 2013. Pursuant to the covenants set forth in the senior preferred stock purchase agreement described
below, we must obtain the prior written consent of Treasury in order to exercise our option to redeem the
Series T Preferred Stock.
Conversions of Preferred Stock to Common Stock
For the year ended December 31, 2009, 17,335,866 shares of Mandatory Convertible Series 2008-1 were
converted to 26,711,068 shares of common stock. Also 78 shares of Mandatory Convertible Series 2004-1
were converted to 82,705 shares of common stock. For the year ended December 31, 2008, 10,053,599 shares
of Mandatory Convertible Series 2008-1 were converted to 15,490,568 shares of common stock.
Senior Preferred Stock and Common Stock Warrant
On September 8, 2008, we issued one million shares of Variable Liquidation Preference Senior Preferred
Stock, Series 2008-2 (“senior preferred stock”), with an aggregate stated value and initial liquidation
preference of $1.0 billion. On September 7, 2008, we issued a warrant to purchase common stock to Treasury.
The warrant gives Treasury the right to purchase shares of our common stock equal to 79.9% of the total
number of shares of common stock outstanding on a fully diluted basis on the date of exercise. The senior
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FANNIE MAE
(In conservatorship)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)