Zachary Carpenter
About Zachary Carpenter
Zachary N. Carpenter (age 43) is Executive Vice President – Chief Business Officer at Federal Agricultural Mortgage Corporation (Farmer Mac), serving since May 2019. He holds a B.S. in Economics (finance concentration) from the Wharton School and an MBA (corporate finance, accounting, business law) from NYU Stern . Company performance during his tenure has been strong: net income rose from $114.4m (2020) to $207.2m (2024), and Farmer Mac’s Class C TSR (value of $100 investment) improved to $281 by 2024 (vs $93 in 2020) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CoBank, ACB | Managing Director & Sector VP, Corporate Agribusiness Banking; previously Executive Director, Capital Markets | Not disclosed | Led and developed agribusiness financing solutions; capital markets execution; industry relationships |
| Goldman Sachs | Vice President, Corporate Finance | Not disclosed | Corporate finance experience informing capital markets and client solutions |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Not disclosed in proxy | — | — | No external public company directorships disclosed in the executive officer biography |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Base Salary ($) | $435,000 | $450,000 | $465,000 | $475,000 |
| Target Bonus % of Salary | 75% (raised from 62.5% for 2022) | 75% | 75% | 75% (design unchanged for 2025) |
| Target Bonus ($) | $326,250 (75% of $435k) | $337,500 (75% of $450k) | $348,750 (75% of $465k) | Not disclosed (structure maintained) |
| Actual Non-Equity Incentive (Paid for Performance Year) ($) | $555,521 (2022) | $614,315 (2023) | $313,528 (2024) | — |
Notes:
- 2025 base salary increase of $10,000 effective Jan 1, 2025 .
- 2024 target total direct compensation: $1,263,750 (salary $465,000; target bonus $348,750; target LTI $450,000) .
Performance Compensation
Annual Incentive Scorecard (2024 performance; paid March 2025)
| Measure | Weight | Threshold (50% payout) | Target (100%) | Maximum (200%) | Result | Payout Contribution |
|---|---|---|---|---|---|---|
| Earnings | 25% | $173.3m | $184.5m | $197.3m | $180.9m | 20.96% |
| Total Revenues | 15% | $351.8m | $374.4m | $400.5m | $362.0m | 10.88% |
| Business Volume (avg outstanding) | 10% | $27.4b | $28.5b | $30.4b | $28.7b | 11.39% |
| Ratio Substandard Assets / Regulatory Capital | 15% | <40% | <20% | <10% | 28.87% | 11.67% |
| Leadership & Strategic Performance | 35% | Committee evaluation | Committee evaluation | Committee evaluation | Uniform strong leadership noted | 35.00% |
| Total | 100% | — | — | — | — | 89.90% of target for each NEO |
2025 plan keeps the same metrics/weights with recalibrated thresholds (e.g., earnings and revenue thresholds ~1% above 2024 results; max ~12% above), plus qualitative leadership component; payout curve 50–200% .
Long-Term Incentive Design and 2024 Grants (Carpenter)
- LTI mix for NEOs: 50% time-based RSUs, 25% performance-based RSUs (3-year cumulative “Earnings before Credit” with capital/asset quality gatekeepers), 25% SARs; RSUs vest 1/3 annually; SARs vest 1/3 annually and have 10-year term .
- 2024 grants (March 5, 2024):
- Time-based RSUs: 1,215 units; grant-date fair value $241,226
- Performance-based RSUs: threshold 304; target 608; max 1,216; grant-date fair value $120,712
- SARs: 2,067 units at $198.54 strike; grant-date fair value $126,757
| Component | Grant Date | Quantity / Terms | Fair Value ($) |
|---|---|---|---|
| Time-based RSUs | 3/5/2024 | 1,215 RSUs; vest 1/3 per year | $241,226 |
| Performance RSUs (3-yr EBC) | 3/5/2024 | 304 / 608 / 1,216 (thr/target/max) | $120,712 |
| SARs | 3/5/2024 | 2,067 SARs; $198.54 strike; 10-year term; 1/3 vesting | $126,757 |
PSU vesting outcomes:
- 2022 PSUs (3-year period ending 12/31/2024) vested at 200% of target on March 31, 2025, as cumulative Earnings before Credit exceeded the max goal; gatekeeper metrics were satisfied .
Equity Ownership & Alignment
Beneficial Ownership (as of Mar 24, 2025)
| Security | Amount | % of Class | Notes |
|---|---|---|---|
| Class C Non-Voting Common Stock | 10,083 | <1% | Includes 3,036 shares underlying SARs exercisable/vestable within 60 days |
Ownership policies and trading restrictions:
- Officer stock ownership guideline: Executive Vice President = 2x annual salary .
- Hedging and pledging: Insider trading policy prohibits pledging and specified hedging in Farmer Mac securities .
Unvested RSUs and Scheduled Vesting (as of Dec 31, 2024)
| Grant Type | Units Unvested | Market Value | Scheduled Vest |
|---|---|---|---|
| RSUs (time/perf mix) | 2,731 | $537,870 | March 31, 2025 |
| RSUs (time/perf mix) | 1,613 | $317,680 | March 31, 2026 |
| RSUs (time/perf mix) | 1,013 | $199,510 | March 31, 2027 |
Valuation based on $196.95/share (12/31/2024 close) .
SAR Holdings (as of Dec 31, 2024)
| Exercise Price | Exercisable | Unexercisable | Expiration |
|---|---|---|---|
| $120.38 | — | 851 | Mar 9, 2032 |
| $135.20 | 748 | 1,496 | Mar 31, 2033 |
| $198.54 | — | 2,067 | Mar 5, 2034 |
Vesting notes: Unexercisable tranches vest in equal annual installments on March 31 (subject to service/retirement provisions). The $120.38 tranche vested in full on March 31, 2025; the $198.54 tranche vests 2025–2027 .
Potential selling pressure windows:
- Annual RSU vesting on March 31 each year (2025–2027) plus SAR tranches vesting on the same cadence may create incremental sellable share supply around those dates .
Employment Terms
- Contract status: Carpenter does not have an individual employment agreement; participates in the Amended and Restated Executive Officer Severance Plan (revised 2020) .
- Severance (termination without cause or qualifying adverse change): Lump sum equal to base salary + annual target bonus; 12 months COBRA premium differential; accrued salary/expenses; in lieu of other severance .
- As of Dec 31, 2024, estimated: Base $465,000; Target Bonus $348,750; Total $813,750; plus 12 months COBRA at company expense .
- Disability termination: 12 months of base salary less LTD benefits (subject to policy limits) .
- Non-compete / Non-solicit / NDA / Non-disparagement: 1-year non-compete; 2-year non-solicit; confidentiality; non-disparagement under participation agreement .
- Change-in-control: No additional benefits and no equity acceleration; Farmer Mac’s structure substantially precludes change-in-control .
- Clawback: Policy consistent with SEC/NYSE for restatements, for-cause terminations, or miscalculated financial metrics .
- Perquisites: Limited (e.g., paid parking; incremental executive physical) .
- Retirement/Deferred Compensation: No enhanced pension/SERP; participates in defined contribution plans. Company nonqualified contributions for Carpenter were $22,680 (2024), $22,680 (2023), $24,570 (2022) .
Performance & Track Record
Financial and Stock Performance (context for pay-for-performance)
| Year | Net Income ($) | Core “Earnings before Credit” ($) | Farmer Mac TSR – $100 Invested |
|---|---|---|---|
| 2020 | 114,376,000 | 106,639,000 | $93 |
| 2021 | 136,089,000 | 111,842,000 | $161 |
| 2022 | 178,144,000 | 125,598,000 | $152 |
| 2023 | 200,003,000 | 172,053,000 | $284 |
| 2024 | 207,193,000 | 180,862,000 | $281 |
Selected 2024 accomplishments (qualitative scorecard factors): record earnings and revenue growth while maintaining excellent credit; strong ROE and TSR; completed two structured securitizations improving capital efficiency and fee income; enhanced internal servicing; progressed on complex commercial loan capabilities; maintained sub-30% operating efficiency with low attrition; strengthened strategic planning and risk management; broadened stakeholder outreach .
Governance, Committee Context, Peer Benchmarking
- Compensation Committee members determining 2024 pay: Culver, Davidson, Engebretsen, Faivre, Ware; chair transition from Davidson (through May 2024) to Ware; Riel joined in May 2024 (after decisions set) .
- Say-on-Pay: 99% support in 2024; Board continued pay-for-performance approach .
- Peer group: Blended market of public banks plus GSE-like institutions (Farm Credit System banks, FHLBs) and CFC to reflect Farmer Mac’s unique profile; used for 2024 decisions .
Compensation Structure Analysis
- Increased at-risk mix maintained: target bonus held at 75% of salary; 2024 LTI target increased $50,000 YoY to $450,000 .
- Shift to RSUs vs SARs in LTI mix continues (RSUs 75% combined, SARs 25%), reducing risk and emphasizing retention and long-term alignment .
- Discretionary payouts: 2024 scorecard delivered 89.9% of target; qualitative leadership component uniform across NEOs based on strong team performance .
- No CIC benefits or equity acceleration; clawback policy and hedging/pledging prohibitions strengthen governance .
Investment Implications
- Alignment: High proportion of at-risk pay with objective metrics (earnings, revenue, business volume, asset quality) and multi-year PSUs tied to Earnings before Credit with prudential gatekeepers; strong say-on-pay (99%) suggests shareholder acceptance .
- Retention risk: Moderate. Severance provides 1x salary+target bonus and 12 months COBRA; non-compete (1 year) and non-solicit (2 years) limit mobility; absence of CIC benefits removes windfall incentives .
- Trading signals: Annual March 31 vesting (time-based RSUs and PSU cycles) plus SARs vesting on the same date could create episodic selling pressure; 2022 PSU cycle paid at 200% on Mar 31, 2025, amplifying that year’s vest-related float .
- Skin-in-the-game: Beneficial ownership of 10,083 shares (<1%) plus vested/near-term SARs supports alignment; pledging prohibited; EVP ownership guideline of 2x salary applies (compliance status not disclosed) .