bond_purchaseagrmt.htm


    RUS

    


    


    


    SERIES
C BOND PURCHASE AGREEMENT

    


    by and
among

    


    FEDERAL
FINANCING BANK,

    


    NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION,

    


    and

    


    ADMINISTRATOR of the RURAL UTILITIES
SERVICE

    


    


     

    


    made as
of

    


    September
19, 2008

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        RUS

      

    

     

    
      
        	
                TABLE
      OF CONTENTS

              
	 
      	
                Page

              
	 
      
	
                TITLE/PARTIES

              	 
      	
                1

              
	 
      	 
      	 
      
	
                RECITAL
      PARAGRAPHS

              	 
      	
                1

              
	 
      
	
                ARTICLE
      1  DEFINITIONS AND RULES OF INTERPRETATION

              	
                2

              
	 
      	 
      	 
      
	 
      	
                Section
      1.1  Definitions

              	
                2

              
	 
      	 
      	 
      
	 
      	
                Section
      1.2  Rules of Interpretation

              	
                6

              
	 
      	 
      	 
      
	
                ARTICLE
      2  FFB COMMITMENT TO PURCHASE THE BOND

              	
                6

              
	 
      	 
      	 
      
	
                ARTICLE
      3  COMMITMENT CONDITIONS

              	
                6

              
	 
      
	 
      	
                Section
      3.1  Commitment Amount Limit

              	
                6

              
	 
      	 
      	 
      
	 
      	
                Section
      3.2  Borrower Instruments

              	
                6

              
	 
      	 
      	 
      
	 
      	
                Section
      3.3  RUS Instruments

              	
                7

              
	 
      	 
      	 
      
	
                ARTICLE
      4  OFFER OF THE BOND FOR PURCHASE

              	
                7

              
	 
      	 
      	 
      
	 
      	
                Section
      4.1  Delivery of Borrower Instruments to RUS

              	
                7

              
	 
      	 
      	 
      
	 
      	
                Section
      4.2  Delivery of Principal Instruments by RUS to

              	 
      
	 
      	
                FFB

              	
                8

              
	 
      	 
      	 
      
	
                ARTICLE
      5  PURCHASE OF THE BOND BY FFB

              	
                8

              
	 
      	 
      	 
      
	 
      	
                Section
      5.1  Acceptance or Rejection of Principal

              	 
      
	 
      	
                Instruments

              	
                8

              
	 
      	 
      	 
      
	 
      	
                Section
      5.2  Purchase

              	
                9

              
	 
      	 
      	 
      
	
                ARTICLE
      6  LOST, STOLEN, DESTROYED, OR MUTILATED BOND

              	
                9

              
	 
      	 
      	 
      
	 
      	
                Section
      6.1  Borrower's Agreement

              	
                9

              
	 
      	 
      	 
      
	 
      	
                Section
      6.2  RUS's Agreement

              	
                9

              
	 
      	 
      	 
      
	 
      	
                Section
      6.3  FFB's Agreement

              	
                10

              
	 
      	 
      	 
      
	
                ARTICLE
      7  ADVANCES

              	
                10

              
	 
      	 
      	 
      
	 
      	
                Section
      7.1  Commitment

              	
                10

              
	 
      	 
      	 
      
	 
      	
                Section
      7.2  Treasury Policies Applicable to Advances

              	
                10

              


      


      
        
           


        

        
          BOND
PURCHASE AGREEMENT - page i

          
            

          

        

        
           


          RUS

        

      

      


      
        	 
      	
                Section
      7.3  Conditions to Making Advances

              	
                11

              
	 
      	 
      	 
      
	 
      	
                Section
      7.4  Amount and Timing of Advances

              	
                13

              
	 
      	 
      	 
      
	 
      	
                Section
      7.5  Type of Funds and Means of Advance

              	
                14

              
	 
      	 
      	 
      
	 
      	
                Section
      7.6  Interest Rate Applicable to Advances

              	
                14

              
	 
      	 
      	 
      
	 
      	
                Section
      7.7  Interest Rate Confirmation Notices

              	
                15

              
	 
      	 
      	 
      
	 
      	
                Section
      7.8  Borrower's Agreement

              	
                15

              
	 
      	 
      	 
      
	
                ARTICLE
      8  REPRESENTATIONS AND WARRANTIES BY THE
BORROWER

              	
                15

              
	 
      	 
      	 
      
	
                ARTICLE
      9  BILLING BY FFB

              	
                16

              
	 
      	 
      	 
      
	 
      	
                Section
      9.1  Billing Statements to the Borrower and

              	 
      
	 
      	
                RUS

              	
                16

              
	 
      	 
      	 
      
	 
      	
                Section
      9.2  Failure to Deliver or Receive Billing

              	 
      
	 
      	
                Statements
      No Release

              	
                16

              
	 
      	 
      	 
      
	 
      	
                Section
      9.3  FFB Billing Determinations Conclusive

              	
                16

              
	 
      	 
      	 
      
	
                ARTICLE
      10  PAYMENTS TO FFB AND RUS

              	
                17

              
	 
      	 
      	 
      
	 
      	
                Section
      10.1  Manner and Timing of Payment

              	
                17

              
	 
      	 
      	 
      
	 
      	
                Section
      10.2  Application of Payments

              	
                17

              
	 
      	 
      	 
      
	
                ARTICLE
      11  BORROWER'S PRIVILEGES TO PREPAY OR REFINANCE

              	 
      
	 
      	
                ADVANCES

              	
                17

              
	 
      	 
      	 
      
	 
      	
                Section
      11.1  Automatic Application or Required

              	 
      
	 
      	
                Election

              	
                17

              
	 
      	 
      	 
      
	 
      	
                Section
      11.2  "Market Value Prepayment/Refinancing

              	 
      
	 
      	
                Privilege"

              	
                19

              
	 
      	 
      	 
      
	 
      	
                Section
      11.3  "Fixed Premium Prepayment/Refinancing

              	 
      
	 
      	
                Privilege"

              	
                22

              
	 
      	 
      	 
      
	 
      	
                Section
      11.4  New Notices and Billing Statements After

              	 
      
	 
      	
                Refinancings

              	
                23

              
	 
      	 
      
	
                ARTICLE
      12  BOND SERVICING AND RELATED DUTIES AND RIGHTS

              	
                23

              
	 
      	 
      	 
      
	 
      	
                Section
      12.1  Custody of Bond

              	
                23

              
	 
      	 
      	 
      
	 
      	
                Section
      12.2  RUS Duties as Bond Servicer and Guarantor

              	
                23

              


      


      
        
           


        

        
          BOND
PURCHASE AGREEMENT - page ii

          
            

          

        

        
           


          RUS

        

      


      


      
        	 
      	
                Section
      12.3  Bond Servicing Fee

              	
                24

              
	 
      	 
      	 
      
	 
      	
                Section
      12.4  Liability and Rights of RUS as Guarantor

              	
                24

              
	 
      	 
      	 
      
	 
      	
                Section
      12.5  Bond Payments Made by RUS

              	
                24

              
	 
      	 
      	 
      
	
                ARTICLE
      13  AGREEMENTS AND OTHER RIGHTS OF RUS

              	
                26

              
	 
      	 
      	 
      
	 
      	
                Section
      13.1  Delivery of Replacement Certificates

              	 
      
	 
      	
                Specifying
      Authorized RUS Officials

              	
                26

              
	 
      	 
      	 
      
	 
      	
                Section
      13.2  Certain Agreements of RUS and FFB

              	
                26

              
	 
      	 
      	 
      
	 
      	
                Section
      13.3  Reimbursement

              	
                27

              
	 
      	 
      	 
      
	 
      	
                Section
      13.4  Effect of RUS's Nonperformance

              	
                27

              
	 
      	 
      	 
      
	 
      	
                Section
      13.5  Right of RUS to Purchase Advances and

              	
                27

              
	 
      	 
      	 
      
	
                ARTICLE
      14  EFFECTIVE DATE, TERM, SURVIVAL

              	
                28

              
	 
      	 
      	 
      
	 
      	
                Section
      14.1  Effective Date

              	
                28

              
	 
      	 
      	 
      
	 
      	
                Section
      14.2  Term of Commitment to Make Advances

              	
                28

              
	 
      	 
      	 
      
	 
      	
                Section
      14.3  Survival

              	
                28

              
	 
      	 
      	 
      
	
                ARTICLE
      15  MISCELLANEOUS

              	
                29

              
	 
      	 
      	 
      
	 
      	
                Section
      15.1  Notices

              	
                29

              
	 
      	 
      	 
      
	 
      	
                Section
      15.2  Amendments

              	
                31

              
	 
      	 
      	 
      
	 
      	
                Section
      15.3  Successors and Assigns

              	
                31

              
	 
      	 
      	 
      
	 
      	
                Section
      15.4  Sale or Assignment of Bond

              	
                31

              
	 
      	 
      	 
      
	 
      	
                Section
      15.5  Forbearance Not a Waiver

              	
                33

              
	 
      	 
      	 
      
	 
      	
                Section
      15.6  Rights Confined to Parties

              	
                33

              
	 
      	 
      	 
      
	 
      	
                Section
      15.7  Governing Law

              	
                33

              
	 
      	 
      	 
      
	 
      	
                Section
      15.8  Severability

              	
                34

              
	 
      	 
      	 
      
	 
      	
                Section
      15.9  Headings

              	
                34

              
	 
      	 
      	 
      
	 
      	
                Section
      15.10  Counterparts

              	
                34

              
	 
      	 
      	 
      
	
                SIGNATURES

              	
                35

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      


      

       

    

    
      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page iii

          
            

          

        

        
          
          

          RUS

        

      

      EXHIBIT
A  FORM OF ADVANCE REQUEST

      


      EXHIBIT
B  FORM OF BOND

      


      EXHIBIT
C  FORM OF CERTIFICATE SPECIFYING AUTHORIZED BORROWER

       OFFICIALS

      


      EXHIBIT
D  FORM OF CERTIFICATE SPECIFYING AUTHORIZED RUS

       OFFICIALS

      


      EXHIBIT
E  FORM OF OPINION OF BORROWER'S COUNSEL re: BORROWER'S

       INSTRUMENTS

      


      EXHIBIT
F  FORM OF OPINION OF RUS'S COUNSEL re: RUS GUARANTEE

      


      EXHIBIT
G  FORM OF RUS CERTIFICATE

      


      EXHIBIT
H  FORM OF RUS GUARANTEE

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page iv

          
            

          

        

        
          
          

          RUS

        

      

    

     

    
      SERIES C BOND PURCHASE AGREEMENT
made as of September 19, 2008, by and among the FEDERAL FINANCING BANK ("FFB"), a body
corporate and instrumentality of the United States of America, the NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION (the "Borrower"), a
cooperative association organized and existing under the laws of the District of
Columbia, and the ADMINISTRATOR of the RURAL UTILITIES SERVICE
("RUS"), a
Rural Development agency of the United States Department of
Agriculture.

      


      


      


      WHEREAS, RUS is authorized,
pursuant to the Guarantee Authority (as hereinafter defined), to guarantee loans
that meet the requirements of the Guarantee Authority; and

      


      WHEREAS, FFB is authorized,
under section 6(a) of the FFB Act (as hereinafter defined), to make commitments
to purchase, and to purchase on terms and conditions determined by FFB, any
obligation that is issued, sold, or guaranteed by an agency of the United States
of America; and

      


      WHEREAS, FFB is entering into
this Series C Bond Purchase Agreement, as authorized by section 6(a) of the FFB
Act, setting out, among other things, FFB's agreement to purchase, pursuant to
the FFB Act, the Bond (as hereinafter defined) to be issued by the Borrower,
when the terms and conditions specified herein have been satisfied, as
hereinafter provided; and

      


      WHEREAS, RUS has determined
that the Borrower meets the qualifications for being a "lender," as that term is
used in the Guarantee Authority, and for being a "Guaranteed Lender," as that
term is used in the regulations promulgated by RUS to carry out the Guarantee
Authority; and 

      


      WHEREAS, RUS is authorized to
enter into this Series C Bond Purchase Agreement; and

      


      WHEREAS, the Borrower is
authorized to enter into this Series C Bond Purchase Agreement.

      


      NOW, THEREFORE, for and in
consideration of the mutual agreements herein contained and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, FFB, RUS, and the Borrower agree as follows: 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 1

          
            

          

        

        
          
          

          RUS

        

      

      ARTICLE
1

      


      DEFINITIONS
AND RULES OF INTERPRETATION

      


      


      Section 1.1  Definitions.  

      


      As used
in this Agreement, the following terms shall have the respective meanings
specified in this section 1.1, unless the context clearly requires
otherwise.

      


      "Advance" shall mean
an advance of funds made by FFB under the Bond in accordance with the provisions
of article 7 of this Agreement.

      


      "Advance Identifier"
shall mean, for each Advance, the particular sequence of letters and numbers
constituting the Bond Identifier plus the particular sequence of additional
numbers assigned by FFB to the respective Advance in the interest rate
confirmation notice relating to such Advance delivered by FFB in accordance with
section 7.7 of this Agreement.

      


      "Advance Request"
shall mean a letter from a Borrower requesting an Advance under the Bond, in the
form of letter attached as Exhibit A to this
Agreement.

      


      "Advance Request Approval
Notice" shall mean the written notice from RUS located at the end of an
Advance Request advising FFB that such Advance Request has been approved on
behalf of RUS.

      


      "Bond" shall mean a
future advance bond of the Borrower payable to FFB, in the form of bond that is
attached as Exhibit B to
this Agreement, as such bond may be amended, supplemented, and restated from
time to time in accordance with its terms.

      


      "Bond Guarantee
Agreement" shall mean the Series C Bond Guarantee Agreement dated as of
even date herewith, made between RUS and the Borrower, as such agreement may be
amended, supplemented, and restated from time to time in accordance with its
terms.

      


      "Bond Identifier"
shall mean the particular sequence of letters and numbers assigned by FFB to the
Bond in the Principal Instruments acceptance notice relating to the Bond
delivered by FFB in accordance with section 5.1 of this Agreement.


      


      "Borrower Instruments"
shall have the meaning specified in section 3.2.1 of this
Agreement.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 2

          
            

          

        

        
          
          

          RUS

        

      

      "Business Day" shall
mean any day on which FFB and the Federal Reserve Bank of New York are both open
for business.

      


      "Certificate Specifying
Authorized Borrower Officials" shall mean a certificate of the Borrower
specifying the names and titles of those officials of the Borrower who are
authorized to execute and deliver from time to time Advance Requests on behalf
of the Borrower, and containing the original signature of each of those
officials, substantially in the form of the Certificate Specifying Authorized
Borrower Officials attached as Exhibit C to this
Agreement. 

      


      "Certificate Specifying
Authorized RUS Officials" shall mean a certificate specifying the names
and titles of those officials of RUS who are authorized to execute and deliver
Advance Request Approval Notices from time to time on behalf of RUS and setting
out the original signature of each of those authorized officials, and specifying
the name and title of those officials of RUS who are authorized to confirm
telephonically the authenticity of the Advance Request Approval Notices from
time to time on behalf of RUS and setting out the telephone number of each of
those authorized officials, in the form of the Certificate Specifying Authorized
RUS Officials attached as Exhibit D to this
Agreement. 

      


      "FFB Act" shall mean
the Federal Financing Bank Act of 1973 (Pub. L. No. 93-224, 87 Stat. 937,
codified at 12 U.S.C. § 2281 et seq.), as
amended.

      


      "FFB Financing Options
Fee" shall mean the fee, expressed in terms of a basis point increment in
the basic interest rate established for an Advance, payable by the Borrower to
the Holder if the Borrower elects to have a Fixed Premium Prepayment/Refinancing
Privilege apply to such Advance, as described in section 11.3 of this
Agreement.

      


      "First Call Date"
shall have the meaning specified in section 11.3.2(a) of this
Agreement.

      


      "Fixed Premium
Prepayment/Refinancing Privilege" shall have the meaning specified in
section 11.3.1 of this Agreement.

      


      "Governmental
Authority" shall mean any federal, state, county, municipal, or regional
authority, or any other entity of a similar nature, exercising any executive,
legislative, judicial, regulatory, or administrative function of
government.    

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 3

          
            

          

        

        
          
          

          RUS

        

      

      "Guarantee Authority"
shall mean section 313A of the Rural Electrification Act of 1936, as amended
(codified at 7 U.S.C. § 940c-1).

      


      "Holder" shall mean
FFB, for so long as it shall be the holder of the Bond, and any successor or
assignee of FFB, for so long as such successor or assignee shall be the holder
of the Bond.

      


      "Loan Commitment
Amount" shall mean $500,000,000.00.

      


      "Market Value Premium (or
Discount)" shall have the meaning specified in section 11.2 of this
Agreement.

      


      "Market Value
Prepayment/Refinancing Privilege" shall have the meaning specified in
section 11.2 of this Agreement.

      


      "Maturity Date" shall
have the meaning specified in section 7.3.1(a)(5) of this Agreement.


      


      "No-Call Period" shall
have the meaning specified in section 11.3.2 of this Agreement.

      


      "Opinion of Borrower's
Counsel re: Borrower Instruments" shall mean an opinion of counsel from
the General Counsel of the Borrower, substantially in the form of opinion that
is attached as Exhibit
E to this Agreement.

      


      "Opinion of RUS's Counsel re:
RUS Guarantee" shall mean an opinion of counsel from the Acting General
Counsel of the Department of Agriculture to the Administrator of RUS,
substantially in the form of opinion that is attached as Exhibit F to this
Agreement.

      


      "Payment Date" shall
mean January 15, April 15, July 15, and October 15 of each
year.

      


      "Person" shall mean
any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, trust company, unincorporated organization or
Governmental Authority.

      


      "Pledge Agreement"
shall mean the Pledge Agreement dated as of even date herewith, made among the
Borrower, RUS, and U.S. Bank Trust National Association, a national association,
as such agreement may be amended, supplemented, and restated from time to time
in accordance with its terms.

      


      "Principal
Instruments" shall have the meaning specified in section 4.2 of this
Agreement.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 4

          
            

          

        

        
          
          

          RUS

        

      

      "Requested Advance
Amount" shall have the meaning specified in section 7.3.1(a)(2) of this
Agreement.

      


      "Requested Advance
Date" shall have the meaning specified in section 7.3.1(a)(3) of this
Agreement. 

      


      "RUS Certificate"
shall mean a certificate relating to the RUS Guarantee and other matters, in the
form of certificate that is attached as Exhibit G to this
Agreement.

      


      "RUS Guarantee" shall
mean a guarantee of the Bond issued by RUS, in the form of guarantee that is
attached as Exhibit
H to this Agreement.

      


      "RUS Instruments"
shall have the meaning specified in section 3.3.1 of this
Agreement.

      


      "this Agreement" shall
mean this Series C Bond Purchase Agreement between FFB, RUS, and the
Borrower.

      


      "Uncontrollable Cause"
shall mean, for FFB, an unforeseeable cause beyond the control and without the
fault of FFB, being:  act of God, fire, flood, severe weather, epidemic,
quarantine restriction, explosion, sabotage, act of war, act of terrorism, riot,
civil commotion, lapse of the statutory authority of the United States
Department of the Treasury to raise cash through the issuance of Treasury debt
instruments, disruption or failure of the Treasury Financial Communications
System, closure of the Federal Government, or an unforeseen or unscheduled
closure or evacuation of the FFB offices; and shall mean, for RUS, an
unforeseeable cause beyond the control and without the fault of RUS,
being:  act of God, fire, flood, severe weather, epidemic, quarantine
restriction, explosion, sabotage, act of war, act of terrorism, riot, civil
commotion, closure of the Federal Government, or an unforeseen or unscheduled
closure or evacuation of the RUS offices.

      


      Section 1.2  Rules of
Interpretation.  

      


      Unless
the context shall otherwise indicate, the terms defined in section 1.1 of this
Agreement shall include the plural as well as the singular and the singular as
well as the plural.  The words "herein," "hereof," and "hereto," and words
of similar import, refer to this Agreement as a whole.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 5

          
            

          

        

        
          
          

          RUS

        

      

      


      ARTICLE
2

      


      FFB
COMMITMENT TO PURCHASE THE BOND

      


      


      Subject
to the terms and conditions of this Agreement, FFB agrees to purchase the Bond
that is offered by the Borrower to FFB for purchase under this
Agreement.

      


      


      ARTICLE
3

      


      COMMITMENT
CONDITIONS

      


      


      FFB shall
be under no obligation to purchase the Bond under this Agreement unless and
until each of the conditions specified in this article 3 has been
satisfied.

      


      Section
3.1  Commitment Amount
Limit.

      


      The
maximum principal amount of the Bond that is offered for purchase shall not
exceed the Loan Commitment Amount.

      


      Section
3.2  Borrower
Instruments.

      


      3.2.1  Borrower
Instruments.  FFB shall have received from the Borrower the
following instruments (such instruments being, collectively, the "Borrower
Instruments"):

      


      (a) an
original counterpart of this Agreement, duly executed by the Borrower;
and

      


      (b) the
original Bond, duly executed by the Borrower.

      


      3.2.2  Opinion of Borrower's
Counsel re: Borrower Instruments.  FFB shall have received from
the Borrower an Opinion of Borrower's Counsel re: Borrower
Instruments.

      


      3.2.3  Certificate Specifying
Authorized Borrower Officials.  FFB shall have received from
the Borrower a completed and signed Certificate Specifying Authorized Borrower
Officials.

      


      Section
3.3  RUS
Instruments.

      


      3.3.1  RUS
Instruments.  FFB shall have received from RUS the following
instruments (such instruments being, collectively, the "RUS
Instruments"):

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 6

          
            

          

        

        
          
          

          RUS

        

      

      (a) an
original counterpart of this Agreement, duly executed by RUS;

      


      (b) the
original RUS Guarantee relating to the Bond, duly executed by RUS;
and

      


      (c) an
original RUS Certificate relating to the RUS Guarantee and other matters, duly
executed by RUS.

      


      3.3.2  Opinion of RUS's Counsel re:
RUS Guarantee. FFB shall have received a copy of the Opinion of RUS's
Counsel re: RUS Guarantee.

      


      3.3.3  Certificate Specifying
Authorized RUS Officials. FFB shall have received from RUS a completed
and signed Certificate Specifying Authorized RUS Officials.

      


      


      ARTICLE
4

      


      OFFER
OF THE BOND FOR PURCHASE

       

      


      The Bond
that is to be offered to FFB for purchase under this Agreement shall be offered
in accordance with the procedures described in this article 4.

      


      Section
4.1  Delivery of Borrower
Instruments to RUS.  

      


      The
Borrower shall deliver to RUS, for redelivery to FFB, the
following:

      


      (a) all
of the Borrower Instruments, each duly executed by the Borrower;

      


      (b) an
Opinion of Borrower's Counsel re: Borrower Instruments; and

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 7

          
            

          

        

        
          
          

          RUS

        

      

      (c) a
completed and signed Certificate Specifying Authorized Borrower
Officials.

      


      Section
4.2  Delivery of Principal
Instruments by RUS to FFB.  

      


      RUS shall
deliver to FFB all of the following instruments (collectively being the "Principal
Instruments":

      


      (a) all
of the instruments described in section 4.1 of this Agreement;

      


      (b) all
of the RUS Instruments, each duly executed by RUS;

      


      (c) a
copy of the Opinion of RUS's Counsel re: RUS Guarantee; and

      


      (d) a
completed and signed Certificate Specifying Authorized RUS
Officials.


      


      ARTICLE
5

      


      PURCHASE
OF THE BOND BY FFB


       

      Section 5.1  Acceptance
or Rejection of Principal Instruments.  

      


      Within 5
Business Days after delivery to FFB of the Principal Instruments relating to the
Bond that is offered for purchase under this Agreement, FFB shall deliver by
facsimile transmission (fax) to RUS one of the following:

      


      (a) an
acceptance notice, which notice shall:

      


      (1) state
that the Principal Instruments meet the terms and conditions detailed in
article 3 of this Agreement, or are otherwise acceptable to FFB;
and

      


      (2)
assign a Bond Identifier to the Bond for use by the Borrower and RUS in all
communications to FFB making reference to the Bond; or

      


      (b) a
rejection notice, which notice shall state that one or more of the Principal
Instruments does not meet the terms and conditions of this Agreement and specify
how such instrument or instruments does not meet the terms and conditions of
this Agreement.

      


      Section 5.2  Purchase.  

      


      FFB shall
not be deemed to have accepted the Bond offered for purchase under this
Agreement until such time as FFB shall have delivered an acceptance notice
accepting the Principal Instruments relating to the Bond; provided, however, that in the
event that FFB shall make an Advance under the Bond, then FFB shall be deemed to
have accepted the Bond offered for purchase.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 8

          
            

          

        

        
          
          

          RUS

        

      

      


      ARTICLE
6

      


      LOST,
STOLEN, DESTROYED, OR MUTILATED BOND


       

      Section 6.1  Borrower's
Agreement.

      


      In the
event that the Bond purchased under this Agreement shall become lost, stolen,
destroyed, or mutilated, the Borrower shall, upon the written request of FFB,
execute and deliver, in replacement thereof, a new Bond of like tenor, dated and
bearing interest from the date to which interest has been paid on such lost,
stolen, destroyed, or mutilated Bond or, if no interest has been paid thereon,
dated the same date as such lost, stolen, destroyed, or mutilated
Bond.  Upon delivery of such replacement Bond, the Borrower shall be
released and discharged from any further liability on account of the lost,
stolen, or destroyed Bond.  If the Bond being replaced has been
mutilated, such mutilated Bond shall be surrendered to the Borrower for
cancellation.

      


      Section
6.2  RUS's
Agreement.

      


      In the
event that the Borrower delivers a replacement Bond for a lost, stolen,
destroyed, or mutilated Bond, as provided in section 6.1 of this Agreement, RUS
shall execute and deliver an RUS Guarantee of the replacement Bond in
replacement of the RUS Guarantee of the lost, stolen, destroyed, or mutilated
Bond.

      


      Section
6.3  FFB's
Agreement.

      


      FFB
agrees that, upon delivery by RUS of a replacement RUS Guarantee as provided in
section 6.2 of this Agreement, RUS shall be released and discharged from any
further liability on account of the RUS Guarantee of the lost, stolen,
destroyed, or mutilated Bond.

       

      ARTICLE
7

      


      ADVANCES

      Section 7.1  Commitment.  

      


      Subject
to the terms and conditions of this Agreement, FFB agrees to make Advances under
the Bond for the account of the Borrower.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 9

          
            

          

        

        
          
          

          RUS

        

      

      Section 7.2  Treasury
Policies Applicable to Advances.  

      


      Each of
the Borrower and RUS understands and consents to the following Treasury
financial management policies generally applicable to all advances of
funds:

      


      (a) each
Advance will be requested by the Borrower, and each Advance Request will be
approved by RUS, only at such time and in such amount as shall be necessary to
meet the immediate payment or disbursing need of the Borrower;

      


      (b)
Advances for investment purposes, other than to make loans permitted by the
Guarantee Authority, will not be requested by the Borrower or approved by RUS;
and

      


      (c) all
interest earned on any lawful and permitted investment of Advances, other than
loans permitted by the Guarantee Authority to be made, in excess of the interest
accrued on such Advances, the fee payable under paragraph 9 of the Bond accrued
on such Advances, and the guarantee fee payable on such Advances under article
IV of the Bond Guarantee Agreement, will be remitted to FFB.

      


      Section
7.3  Conditions to Making
Advances.

      


      FFB shall
be under no obligation to make any Advance under the Bond unless and until each
of the conditions specified in this section 7.3 is satisfied.

      


      7.3.1  Advance
Requests.  For each Advance, the Borrower shall have delivered
to RUS, for review and approval before being forwarded to FFB, an Advance
Request, which Advance Request:

      


      (a) shall
specify, among other things:

      


      (1) the
particular "Bond Identifier" that FFB assigned to this Bond (as provided in
section 5.1 of this Agreement;

      


      (2) the
particular amount of funds that the Borrower requests to be advanced (such
amount being the "Requested Advance
Amount" for the respective Advance);

      


      (3) the
particular calendar date that the Borrower requests to be the date on which the
respective Advance is to be made (such date being the "Requested Advance
Date" for such Advance), which date: 

      


      (A) must
be a Business Day; and

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 10

          
            

          

        

        
          
          

          RUS

        

      

      (B) shall
be a date that meets the advance notice requirements prescribed in section
7.3.2(b) of this Agreement;

      


      (4) the
particular bank account to which the Borrower requests that the respective
Advance be made; and

      


      (5) the particular calendar date that
the Borrower selects to be the date on which the respective Advance is to mature
(such date being the "Maturity Date" for
such Advance), which date must meet all of the following criteria:

      


      (A) the Maturity Date for the
respective Advance must be a "Payment Date" (as that term is defined in
paragraph 7 of the Bond);

      


      (B) the Maturity Date for the
respective Advance may not be a date that will occur after the twentieth
anniversary of the Requested Advance Date specified in the respective Advance
Request;

      


      (C) the Maturity Date for the
respective Advance may not be a date that will occur after the particular date
specified on page 1 of the Bond as being the "Final Maturity Date";
and

      


      (D) the period of time between the
Requested Advance Date for the respective Advance and the Maturity Date for such
Advance may not be less than the period from the Requested Advance Date (if such
date is a Payment Date) or the Payment Date immediately following the Requested
Advance Date (if the Requested Advance Date is not a Payment Date) to the next
Payment Date; and

      


      (6) with
respect to each Advance for which the Borrower selects a Maturity Date that will
occur on or after the fifth anniversary of the Requested Advance Date specified
in the respective Advance Request, the particular prepayment/ refinancing
privilege that the Borrower elects to apply to the respective Advance (i.e.
either the Market Value Prepayment/Refinancing Privilege described in section
11.2 of this Agreement or the Fixed Premium Prepayment/Refinancing Privilege
described in section 11.3 of this Agreement); and

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 11

          
            

          

        

        
          
          

          RUS

        

      

      (b) shall
have been duly executed by an official of the Borrower whose name and signature
appear on the Certificate Specifying Authorized Borrower Officials delivered by
the Borrower to FFB pursuant to section 3.2.3 of this Agreement;
and

      


      (c) shall
have been received by FFB not later than a Business Day that meets the advance
notice requirements prescribed in section 7.3.2(b) of this
Agreement.

      


      7.3.2  Advance Request Approval
Notice.  For each Advance, RUS shall have delivered to FFB the
Borrower's executed Advance Request, together with RUS's executed Advance
Request Approval Notice, which Advance Request Approval Notice:

      


      (a) shall
have been duly executed on behalf of RUS by an official of RUS whose name and
signature appear on the Certificate Specifying Authorized RUS Officials
delivered to FFB pursuant to section 3.3.3  of this Agreement;
and

      


      (b) shall
have been received by FFB on or before the third Business Day before the
Requested Advance Date specified in such Advance Request.

      


      7.3.3  Telephonic Confirmation of
Authenticity of Advance Request Approval Notices.  For each
Advance, FFB shall have obtained telephonic confirmation of the authenticity of
the related Advance Request Approval Notice from an official of RUS (a) whose
name, title, and telephone number appear on the Certificate Specifying
Authorized RUS Officials that has been delivered by RUS to FFB pursuant to
section 3.3.3 of this Agreement; and (b) who is not the same official of
RUS who executed the Advance Request Approval Notice on behalf of
RUS.

      


      7.3.4  Bond Maximum Principal
Amount Limit.  At the time of making any Advance under the Bond, the
amount of such Advance, when added to the aggregate amount of all Advances
previously made under the Bond, shall not exceed the maximum principal amount of
the Bond.

      


      7.3.5  Conditions Specified in
Other Agreement.  Each of the conditions specified in the Bond
Guarantee Agreement as being conditions to making Advances under the Bond shall
have been satisfied or waived in writing.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 12

          
            

          

        

        
          
          

          RUS

        

      

      Section 7.4  Amount
and Timing of Advances. 

      


      FFB shall
make each Advance in the Requested Advance Amount specified in the respective
Advance Request and on the Requested Advance Date specified in the respective
Advance Request, subject to satisfaction of the conditions specified in
section 7.3 of this Agreement and subject to the following additional
limitations:

      


      (a) in
the event that the Requested Advance Date specified in the respective Advance
Request is not a Business Day, FFB shall make the respective Advance on the
first day thereafter that is a Business Day;

      


      (b) in
the event that the respective Advance Request and the related Advance Request
Approval Notice are not received by FFB on or before the third Business Day
before the Requested Advance Date specified in such Advance Request, FFB shall
make the respective Advance as soon as practicable thereafter, but in any event
not later than the third Business Day after the Requested Advance Date and the
related Advance Request Approval Notice are received by FFB, unless the Borrower
delivers to FFB and RUS a written cancellation of such Advance Request or a
replacement Advance Request specifying a Requested Advance Date later than the
expiration of the applicable advance notice period; and

      


      (c) in
the event that an Uncontrollable Cause prevents FFB from making the respective
Advance on the Requested Advance Date specified in the respective Advance
Request, FFB shall make such Advance as soon as such Uncontrollable Cause ceases
to prevent FFB from making such Advance, unless the Borrower delivers to FFB and
RUS a written cancellation of such Advance Request or a replacement Advance
Request specifying a Requested Advance Date later than when such Uncontrollable
Cause ceases to prevent FFB from making such Advance.  

      


      Section 7.5  Type of
Funds and Means of Advance.  

      


      Each
Advance shall be made in immediately available funds by electronic funds
transfer to such bank account(s) as shall have been specified in the respective
Advance Request.

      


      Section 7.6  Interest
Rate Applicable to Advances.

      


      7.6.1  Initial Rate
Determinations.  The rate of interest applicable to each
Advance made under the Bond shall be established as provided in paragraph 6
of the Bond, subject to section 7.6.2 of this Agreement.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 13

          
            

          

        

        
          
          

          RUS

        

      

      7.6.2  Rate
Re-determinations.  In the event the Borrower elects to extend
the maturity of all or any portion of the outstanding principal amount of any
Advance, as provided in paragraph 15 of the Bond, or to refinance all or any
portion of the outstanding principal amount of any Advance, as provided in
paragraph 17 of the Bond, then the rate of interest applicable to the
outstanding principal amount of such Advance shall be re-determined by FFB in
accordance with the terms of paragraph 15 or 17 of the Bond, as the case may
be.

      


      Section
7.7  Interest Rate Confirmation
Notices.

      


      7.7.1  Initial
Rates.  After making each Advance, FFB shall deliver, by
facsimile transmission, to the Borrower and RUS written confirmation of the
making of the respective Advance, which confirmation shall: 

      


      (a) state
the date on which such Advance was made;

      


      (b) state
the interest rate applicable to such Advance; and

      


      (c)
assign an Advance Identifier to such Advance for use by the Borrower and RUS in
all communications to FFB making reference to such Advance.

      


      7.7.2  Re-determined
Rates.  In the event that the rate of interest applicable to
the outstanding principal amount of any Advance is re-determined as provided in
section 7.6.2. of this Agreement, FFB shall deliver, by facsimile
transmission, to the Borrower and RUS written confirmation of the
re-determination of such interest rate, which confirmation shall state the date
on which the applicable interest rate was re-determined for such Advance and the
re-determined interest rate.

      


      Section 7.8  Borrower's
Agreement.

      


      The Borrower hereby agrees that each
Advance made by FFB in accordance with an RUS-approved Advance Request delivered
to FFB shall reduce, by the amount of the respective Advance made, FFB's
remaining commitment in section 7.1 of this Agreement to make Advances under the
Bond.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 14

          
            

          

        

        
          
          

          RUS

        

      

      


      ARTICLE 8

      


      REPRESENTATIONS
AND WARRANTIES BY THE BORROWER

      


      


      The
Borrower makes to FFB each of the representations and warranties made by the
Borrower to RUS in paragraphs (a), (b), (c), (d), (e), (f), (g), and (j) of
section 8.2 of the Bond Guarantee Agreement, and each of those representations
and warranties of the Borrower are incorporated herein by reference as if set
out in full herein.


      


      ARTICLE
9

      


      BILLING
BY FFB


      


      Section
9.1  Billing
Statements to the Borrower and RUS.

      


      After
making each Advance, FFB shall prepare a billing statement detailing the amounts
owed on the respective Advance and when such amounts are due.  FFB
shall deliver, by facsimile transmission, each such billing statement to the
Borrower and RUS.

      


      Section 9.2  Failure
to Deliver or Receive Billing Statements No Release.   

      


      Failure
on the part of FFB to deliver any billing statement or failure on the part of
the Borrower or RUS to receive any billing statement shall not, however, relieve
the Borrower of any of its payment obligations under the Bond or this Agreement
or relieve RUS from any of its payment obligations under the RUS Guarantee or
this Agreement.

      


      Section
9.3  FFB
Billing Determinations Conclusive.

      


      9.3.1  Acknowledgment and
Consent.  The Borrower and RUS each acknowledge that FFB has
described to it the rounding methodology employed by FFB in calculating the
amount of accrued interest owed at any time on the Bond, and the Borrower and
RUS each consent to this methodology.

      


      9.3.2  Agreement.  The
Borrower and RUS each agree that any and all determinations made by FFB shall be
conclusive and binding upon the Borrower and RUS with respect to the amount of
accrued interest owed on the Bond determined using this rounding
methodology.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 15

          
            

          

        

        
          
          

          RUS

        

      

      


      ARTICLE 10

      


      PAYMENTS
TO FFB AND RUS

      


      


      Section 10.1  Manner and Timing of
Payment.

      


      Each
amount that becomes due and owing on the Bond purchased under this Agreement
shall be paid when and as due, as provided in the Bond.

      


      Section 10.2  Application of
Payments.

      


      10.2.1  Priority of
Payments.  Each payment made on the Bond shall be applied,
first, to the payment of Late Charges (if any) payable under paragraphs 11 and
18 of the Bond, then to the payment of premiums (if any) payable under
paragraphs 16 and 17 of the Bond, then to the payment of unpaid accrued
interest, then on account of outstanding principal, and then to the payment of
the fee payable under paragraph 9 of the Bond.

      


      10.2.2  Agreement between FFB and
RUS.  RUS agrees to 

      transfer
to FFB payments received by RUS under the Bond in such amounts as may be
necessary to conform with the priority of payment requirements contained in
section 10.2.1 of this Agreement.

      


      


      ARTICLE
11

      


      BORROWER'S
PRIVILEGES TO PREPAY OR REFINANCE ADVANCES

      


      


      Section
11.1  Automatic Application or
Required Election.

      


      The
prepayment/refinancing privilege described in section 11.2 of this
Agreement shall apply automatically to each Advance that has a Maturity Date
that will occur before the fifth
anniversary of the Requested Advance Date specified in the respective Advance
Request.  With respect to each Advance for which the Borrower has
selected a Maturity Date that will occur on or after the fifth
anniversary of the Requested Advance Date specified in the respective Advance
Request, the Borrower must elect, at the time of requesting the respective
Advance, the particular prepayment/refinancing privilege that is to apply to
such Advance from between the options described in sections 11.2 and 11.3 of
this Agreement.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 16

          
            

          

        

        
          
          

          RUS

        

      

      Section
11.2  "Market Value
Prepayment/Refinancing Privilege".

      


      If the
prepayment/refinancing privilege described in this section 11.2 applies to
an Advance (such privilege being the  "Market Value
Prepayment/Refinancing Privilege"), the Borrower shall have the privilege
to prepay such Advance (as provided in paragraph 16 of the Bond) or to refinance
such Advance (as provided in paragraph 17 of the Bond) at a prepayment or
refinancing price that will include, in either case, a premium (or discount
credit) equal to the difference
between:

      


      (a) the
price for such Advance that would, if such Advance (including all unpaid
interest accrued thereon through the date of prepayment or refinancing, as the
case may be) were purchased by a third party and held to the "Maturity Date"
applicable to the Advance, produce a yield to the third-party purchaser for the
period from the date of purchase to such Maturity Date substantially equal to
the interest rate that would be set on a loan from the Secretary of the Treasury
to FFB to purchase an obligation having a payment schedule identical to the
payment schedule of such Advance for the period from the date of prepayment or
refinancing, as the case may be, to such Maturity Date; and

      


      (b) the
sum of:

      


      (1) the
outstanding principal amount of such Advance on the date of prepayment or
refinancing, as the case may be; and

      


      (2) all
unpaid interest accrued on such Advance through the date of prepayment or
refinancing, as the case may be,

      


      (the
difference between the price described in paragraph (a) of this section
11.2 and the sum of the amounts described in paragraph (b) of this section 11.2
being the "Market
Value Premium (or Discount)"; if the price described in paragraph (a) is
greater than the sum of the amounts described in paragraph (b), that
difference is the premium; if the price described in paragraph (a) is less than
the sum of the amounts described in paragraph (b), that difference is the
discount credit).  The price described in paragraph (a) of this
section 11.2 shall be calculated by the United States Department of the
Treasury as of the close of business on the second Business Day before the date
of prepayment or refinancing, as the case may be, using standard calculation
methods of the United States Department of the Treasury.  FFB shall
provide the Borrower and RUS with written notice of the price described in
paragraph (a) of this section 11.2 promptly upon completing the
calculation.

      


      
        
          
          

        

        
           BOND
PURCHASE AGREEMENT - page 17

          
            

          

        

        
          
          

          RUS

        

      

      Section
11.3  "Fixed
Premium Prepayment/Refinancing Privilege".

      


      11.3.1
Required Election and
Selection.  If the prepayment/refinancing privilege described
in this section 11.3 applies to such Advance (such privilege being the
"Fixed Premium
Prepayment/Refinancing Privilege"), the Borrower shall have the privilege
to prepay such Advance (as provided in paragraph 16 of the Bond) or to
refinance such Advance (as provided in paragraph 17 of the Bond) at a
prepayment or refinancing price that will include, in either case, a fixed
premium determined by FFB at the time of such prepayment or refinancing, based
on both the no-call period election described in section 11.3.2 of this
Agreement and the premium selection described in section 11.3.3 of this
Agreement made by the Borrower at the time of requesting such
Advance.

      


      11.3.2  "No-Call Period
Election".  First, the Borrower must elect whether or not the
Fixed Premium Prepayment/ Refinancing Privilege that is to apply to the
respective Advance shall include a 5-year period during which such Advance shall
not be eligible
for any prepayment or refinancing (such time period being a "No-Call
Period").  The options are:  

      


      (a)
"yes" -- the
Borrower elects to have the Fixed Premium Prepayment/Refinancing Privilege
include a 5-year No-Call Period, i.e., the Borrower
shall have the privilege to prepay the respective Advance (as provided in
paragraph 16 of the Bond) or to refinance such Advance (as provided in paragraph
17 of the Bond) on or after (but not before):

      


      (1) the
fifth anniversary of the Requested Advance Date for such Advance (if such fifth
anniversary date is a Payment Date); or

      


      (2) the
first Payment Date to occur after the fifth anniversary of the Requested Advance
Date for such Advance (if such fifth anniversary date is not a Payment
Date),

      


      (in
either case, such date being the "First Call Date" for
such Advance); or

      


      (b)
"no" -- the
Borrower elects to have the Fixed Premium Prepayment/Refinancing Privilege not include a 5-year
No-Call Period, i.e., the Borrower
shall have the privilege to prepay the respective Advance (as provided in
paragraph 16 of the Bond) or to refinance 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 18

          
            

          

        

        
          
          

          RUS

        

      

      such
Advance (as provided in paragraph 17 of the Bond) on any Business
Day.

      


      11.3.3  "Premium
Selection".  Second, the Borrower must select the particular
fixed premium that will be required in connection with any prepayment or
refinancing of the respective Advance.  The options are:

      


      (a)
"10 percent premium
declining over 10 years" -- the price for any prepayment or refinancing
of the respective Advance shall include a premium equal to 10 percent of the
amount of principal being prepaid or refinanced, as the case may be, multiplied
by a fraction: 

      


      (1) the
numerator of which is the number of Payment Dates that occur
between:

      


      (A) in
the case of a prepayment, the date of prepayment (if such date is a Payment
Date) or the Payment Date immediately preceding the date of prepayment (if the
date of prepayment is not a Payment Date), and, in the case of a refinancing,
the date of refinancing, which date, in either case, shall be included in
computing the number of Payment Dates; and

      


      (B) the
tenth anniversary of the applicable First Call Date (if the Borrower elected to
have the prepayment/refinancing privilege include a 5-year No-Call Period) or
the tenth anniversary of the Requested Advance Date (if the Borrower elected to
have the prepayment/refinancing privilege not include a 5-year No-Call Period),
which date, in either case, shall be excluded in computing the number of Payment
Dates; and

      


      (2) the
denominator of which is 40,

      


      and no
premium on or after the tenth anniversary of the applicable First Call Date (if
the Borrower elected to have the prepayment/refinancing privilege include a
5-year No-Call Period) or the tenth anniversary of the Requested Advance Date
(if the Borrower elected to have the prepayment/refinancing privilege not
include a 5-year No-Call Period);

      


      (b)
"5 percent premium
declining over 5 years" -- the price for any prepayment or refinancing of
the respective Advance shall include a premium equal to 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 19

          
            

          

        

        
          
          

          RUS

        

      

      5 percent
of the amount of principal being prepaid or refinanced, as the case may be,
multiplied by a fraction: 

       

      (1) the
numerator of which is the number of Payment Dates that occur
between:

      


      (A) in
the case of a prepayment, the date of prepayment (if such date is a Payment
Date) or the Payment Date immediately preceding the date of prepayment (if the
date of prepayment is not a Payment Date), and, in the case of a refinancing,
the date of refinancing, which date, in either case, shall be included in
computing the number of Payment Dates; and

      


      (B) the
fifth anniversary of the applicable First Call Date (if the Borrower elected to
have the prepayment/refinancing privilege include a 5-year No-Call Period) or
the fifth anniversary of the Requested Advance Date (if the Borrower elected to
have the prepayment/refinancing privilege not include a 5-year No-Call Period),
which date, in either case, shall be excluded in computing the number of Payment
Dates; and

      


      (2) the
denominator of which is 20,

      


      and no
premium on or after the fifth anniversary of the applicable First Call Date (if
the Borrower elected to have the prepayment/refinancing privilege include a
5-year No-Call Period) or the fifth anniversary of the Requested Advance Date
(if the Borrower elected to have the prepayment/refinancing privilege not
include a 5-year No-Call Period); or

      


      (c)
"par" -- the
price for any prepayment or refinancing of the respective Advance shall include
no premium.

      


      11.3.4 
Standard for
Calculating FFB Financing Options Fee for Fixed-Premium Prepayment/Refinancing
Privilege.  The fee assessed by FFB and payable by the Borrower
to have the Fixed-Premium Prepayment/Refinancing Privilege described in this
section 11.3 to apply to any Advance (such fee being an "FFB Financing Options
Fee") shall be established on the basis of the determination made by FFB
described in paragraph 6(d) of the Bond. 

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 20

          
            

          

        

        
          
          

          RUS

        

      

      11.3.5  Calculation and Notification
of FFB Financing Options Fee for Fixed-Premium Prepayment/Refinancing
Privilege.  FFB shall make the determination described in
section 11.3.4 of this Agreement for each Advance to which the Borrower has
elected to have the Fixed-Premium Prepayment/Refinancing Privilege apply, at the
time of the establishment of the particular basic interest rate that is to apply
to the respective Advance.  After making such determination for each
Advance, FFB shall notify the Borrower and RUS of the particular FFB Financing
Options Fee (expressed in terms of a basis point increment) that is assessed by
FFB and payable by such Borrower for such Fixed-Premium Prepayment/Refinancing
Privilege in the particular interest rate confirmation notice relating to such
Advance to be delivered by FFB in accordance with section 7.7 of this
Agreement.

      


      Section
11.4  New
Notices and Billing Statements After Refinancings.

      


      In the
event of a refinancing of any Advance, FFB shall provide the Borrower and RUS
with a new interest rate confirmation notice and a new billing statement
reflecting the new interest rate applicable to such Advance.

      


      


      ARTICLE
12

      


      BOND
SERVICING AND RELATED DUTIES AND RIGHTS

      


      Section 12.1  Custody of
Bond.

      


      Subject to section 15.4 of this
Agreement, RUS shall have custody, as agent for FFB, of the original Bond that
has been purchased by FFB under this Agreement until all amounts that are owed
under the Bond have been paid in full or until such time as actual possession of
the original Bond has been requested by FFB. If FFB requests RUS for actual
possession of the original Bond, RUS shall promptly deliver the original Bond to
FFB.

      


      Section 12.2  RUS Duties as Bond Servicer
and Guarantor.

      


      12.2.1  Bond Servicing To Be
Performed by RUS.  Bond servicing shall be performed by RUS, as
agent for FFB, for so long as FFB shall be the Holder of the
Bond.  Payment by FFB for RUS's servicing of the Bond shall be made in
accordance with section 12.3 hereof.

      


      12.2.2  Bond Servicing
Duties.  As a part of servicing the Bond, RUS
shall:

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 21

          
            

          

        

        
          
          

          RUS

        

      

      (a) serve as principal point of contact
for the Borrower with respect to any questions that the Borrower may have about
its borrowings from FFB;

      


      (b) hold, as agent for FFB, the
original Bond in accordance with the terms of section 12.1
hereof;

      


      (c) prepare and deliver to the Borrower
billing statements, which billing statements shall reflect the terms of the
billing statements prepared by FFB and delivered to RUS showing amounts owed
with respect to each Advance made under the Bond;

      


      (d) collect, as agent for FFB, all
amounts paid by the Borrower under the Bond; and

      


      (e) turn over to FFB all amounts
collected under clause (d) of this section 12.2.2 when and as due under the
Bond.

      


      Section 12.3  Bond Servicing Fee.


      


      RUS shall be compensated for performing
the bond servicing described in this article 12 by deducting from the fee
assessed by FFB under paragraph 9 of the Bond and collected by RUS an
amount equal to the cost to RUS, as determined by RUS, of performing the bond
servicing, provided, however, that the
cost to RUS of performing bond servicing for any time period shall not exceed
the fee assessed by FFB under paragraph 9 of the Bond for the same time
period.

      


      Section 12.4  Liability and Rights of RUS
as Guarantor.

      


      12.4.1  Liability as
Guarantor.  If the Bond is in payment default, RUS shall be
liable to FFB in accordance with the terms of the RUS Guarantee, without regard
to the sufficiency of the security or the remedies RUS may enforce against the
Borrower.

      


      12.4.2  Rights as
Guarantor.  In consideration of the RUS Guarantee, RUS shall
have the sole authority (vis-a-vis FFB), if the Bond is in payment default, in
respect of acceleration of the Bond, the exercise of other available remedies,
and the disposition of sums or property recovered.

      


      Section 12.5  Bond Payments Made by
RUS.

      


      12.5.1  General.  RUS
and FFB understand and agree that RUS, in its combined capacity as both bond
servicer and guarantor of the Bond, shall pay to FFB all amounts due and owing
under the Bond, when and as those amounts are due and payable under the terms of
the Bond.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 22

          
            

          

        

        
          
          

          RUS

        

      

      (a) Bond Servicing
Payments.  As bond servicer, RUS shall make payments by turning over
to FFB, when and as due under the Bond, all amounts that have been collected by
RUS under section 12.2.2(d) of this Agreement.

      


      (b) Bond Guarantee
Payments.  As guarantor, RUS shall pay to FFB, when and as due under
the Bond, the difference, if any, between the amounts that are owed to FFB under
the terms of the Bond and the amounts that have been collected under
section 12.2.2(d) of this Agreement.

      


      12.5.2  RUS Payments To Be Made by
Book Transfer.  RUS shall make each payment under section
12.5.1 of this Agreement by internal transfer of funds on the books of the
United States Department of the Treasury from the account of RUS to the account
of FFB specified by FFB from time to time.

      


      12.5.3  Late
Charges.  Subject to section 12.5.4 of this Agreement, in
the event that RUS shall fail to make any payment under section 12.5.1 of
this Agreement when and as that payment by RUS to FFB is due (any such amount
being then an "Overdue
Amount"), the amount payable shall be that Overdue Amount with interest
thereon (such interest being the "Late
Charge").  The Late Charge shall accrue from the scheduled date
of payment for the Overdue Amount (taking into account any Business Day
adjustments under the Bond) to the actual date on which payment is
made.  The Late Charge applicable to RUS shall be calculated in the
same manner as Late Charges applicable to the Borrower are calculated under the
Bond.

      


      12.5.4  Uncontrollable
Cause.  In the event that RUS is prevented by an Uncontrollable
Cause from making any payment under section 12.5.1 of this Agreement at the time
or in the manner as RUS is required to make that payment, then RUS shall make
that payment as soon as the respective Uncontrollable Cause ceases to prevent
RUS from making that payment.  The amount that is then due and owing that
is not paid due to an Uncontrollable Cause for RUS shall bear interest at the
91-day loan rate then established by FFB based on a determination made by the
Secretary of the Treasury pursuant to section 6(b) of the FFB Act, such rate
being subject to re-determination at 91-day intervals if the amount due and
owing is not paid. 

      


      12.5.5  No Modification of Times for
Payment. Nothing in section 12.5.3 or section 12.5.4 of this
Agreement shall be construed as permitting or implying that RUS may, without the
prior written consent of FFB, modify, extend, alter, or affect in any manner


       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 23

          
            

          

        

        
          
          

          RUS

        

      

      whatsoever
(except as explicitly provided herein) the right of FFB to receive any and all
payments on account of the Bond when and as due under the Bond.

      


      12.5.6  Bond Assignment upon Payment
in Full.  Upon payment by RUS to FFB of all amounts required to
be paid by RUS to FFB under section 12.5.1 of this Agreement with respect to the
Bond , FFB shall assign and transfer to RUS all rights held by FFB in that
Bond.


      


      ARTICLE
13

      


      AGREEMENTS
AND OTHER RIGHTS OF RUS


      


      Section 13.1  Delivery
of Replacement Certificates Specifying Authorized RUS Officials.  

      


      13.1.1  Annual Replacement
Certificates.  Promptly after the commencement of each fiscal
year, RUS shall deliver to FFB a Certificate Specifying Authorized RUS
Officials, updated as appropriate, in replacement of the original such
certificate delivered pursuant to section 4.2(d) hereof.

      


      13.1.2  Replacement Certificates
within any Fiscal Year.  RUS may at any time within any fiscal
year deliver to FFB a revised Certificate Specifying Authorized RUS Officials,
updated as appropriate, in replacement of the annual certificate delivered
pursuant to section 13.1.1 hereof.

      


      Section 13.2  Certain
Agreements of RUS and FFB.  

      


      13.2.1  Agent for Compliance
Purposes.  In the event that FFB shall become subject to any
duties under any applicable law or regulation solely because of its providing or
having provided financing under the Bond, RUS shall serve as agent for FFB to
the fullest extent permitted under that law or regulation in connection with
satisfying the requirements of that law or regulation.

      


      13.2.2  RUS's Agreement Regarding
Its Appointment as Agent for FFB.  Recognizing the legitimate
needs of FFB to ensure that RUS, as compliance agent for FFB, has performed all
duties to which FFB becomes subject under any applicable law or regulation
solely because of providing or having provided financing under the Bond, and
with RUS and FFB expressing their intent to cooperate in connection with the
exchange of information related thereto, RUS agrees: 

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 24

          
            

          

        

        
          
          

          RUS

        

      

      (a) to deliver to representatives of
FFB or its designate, when requested to do so by FFB or its designate, actual
possession of the original of any certificate, report, document, or paper
collected or prepared by RUS, as compliance agent for FFB; or

      


      (b) at the option of FFB, to permit
representatives of FFB or its designate, during reasonable business hours, to
have access to, and to inspect and make copies of, any and all certificates,
reports, documents, or papers collected or prepared by RUS, as compliance agent
for FFB.

      


      13.2.3  Litigation
Cooperation.  When requested to do so by FFB, RUS shall
cooperate with FFB in the prosecution or defense of any litigation that FFB may
institute against any Person other than RUS or to which FFB is named as a party,
as the case may be, arising out of FFB providing or having provided financing
under the Bond.  

      


      Section 13.3  Reimbursement.

      


      13.3.1  RUS's Agreement to
Reimburse.  To the extent permitted by applicable law and
subject to the availability of funds, RUS agrees to reimburse FFB (but not any
successor, assignee or transferee of FFB) for any and all liabilities, losses,
costs, or expenses of any nature that may be imposed upon, incurred by, or
asserted against FFB by any Person other than RUS in any way relating to or
arising out of FFB providing or having provided financing under the Bond, but
specifically excluding any liability, loss, cost or expense relating to or
arising out of any sale, assignment, or other transfer by FFB, pursuant to
section 15.4 hereof, of all or any part of the Bond. 

      


      13.3.2  RUS's Agreement to Seek
Appropriations.  In the event that no funds are available to
RUS at the time that RUS needs funds to reimburse FFB as contemplated by
section 13.3.1 hereof, RUS agrees that it will diligently seek to obtain
additional appropriations for that purpose.

      


      13.3.3  FFB's Agreement to Deliver
Notice.  Solely for the purpose of assisting RUS in mitigating
the extent of any reimbursement contemplated by section 13.3.1 hereof, FFB
agrees that it will deliver notice to RUS of any and all liabilities, losses,
costs, or expenses imposed upon, incurred by, or asserted against FFB promptly
after FFB has actual knowledge of the imposition, incurrence, or assertion of
such liability, loss, cost, or expense. 

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 25

          
            

          

        

        
          
          

          RUS

        

      

      Section 13.4  Effect of RUS's
Nonperformance.

      


      In the event that RUS shall fail to
fulfill any of its agreements in this article 13, FFB shall nevertheless
continue to make Advances under the Bond before the date of the respective
failure.

      


      Section 13.5  Right of RUS to Purchase
Advances and Bonds.

      


      13.5.1  RUS's
Right.  Notwithstanding the provisions of the Bond, RUS may
purchase from FFB all or any portion of any Advance that has been made under the
Bond, or may purchase from FFB the Bond in its entirety, in either case in the
same manner, at the same price, and subject to the same limitations as shall be
applicable, under the terms of the Bond, to a prepayment by the Borrower of all
or any portion of any Advance that has been made under the Bond, or a prepayment
by the Borrower of the Bond in its entirety, as the case may be.

      


      13.5.2  Borrower's Acknowledgement
of RUS's Right.  Notwithstanding the provisions of the Bond,
the Borrower acknowledges that RUS may purchase from FFB all or any portion of
any Advance that has been made under the Bond, or may purchase from FFB the Bond
in its entirety, in the same manner, at the same price, and subject to the same
limitations as shall be applicable, under the terms of the Bond, to a prepayment
by the Borrower of all or any portion of any Advance made under the Bond, or a
prepayment by the Borrower of the Bond in its entirety, as the case may
be.


      


      ARTICLE
14

      


      EFFECTIVE
DATE, TERM, SURVIVAL


      Section 14.1  Effective
Date.  

      


      This
Agreement shall be effective as of the date first above written.

      


      Section 14.2  Term of
Commitment to Make Advances.  

      


      The
obligation of FFB under this Agreement to make Advances under the Bond issued by
the Borrower shall expire on the "Last Day for an Advance" specified in the
Bond.

      


      Section 14.3  Survival.  

      


      14.3.1  Representations, Warranties,
and Certifications.  All representations, warranties, and
certifications made by the Borrower in this Agreement, or in 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 26

          
            

          

        

        
          
          

          RUS

        

      

      any
agreement, instrument, or certificate delivered pursuant hereto, shall survive
the execution and delivery of this Agreement, the purchasing of the Bond
hereunder, and the making of Advances thereunder.

      


      14.3.2  Remainder of
Agreement.  Notwithstanding the occurrence and passage of the
Last Day for an Advance, the remainder of this Agreement shall remain in full
force and effect until all amounts owed under this Agreement and the Bond
purchased by FFB under this Agreement have been paid in full.


      


      ARTICLE
15

      


      MISCELLANEOUS


      


      Section 15.1  Notices. 

      


      15.1.1  Addresses of the
Parties.All notices and other communications hereunder or under the Bond
to be made to any party shall be in writing and shall be addressed as
follows:

      


      To
FFB:

      


      Federal
Financing Bank

      Main
Treasury Building

      1500
Pennsylvania Avenue, NW

      Washington,
DC  20220

      


      Attention:  Manager

      


      Telephone
No.(202) 622-2470

      Facsimile
No.(202) 622-0707

      


      To the
Borrower:

      


      National
Rural Utilities Cooperative

        Finance
Corporation

      2201
Cooperative Way

      Herndon,
VA  20171-3025

      


      Attention:  Chief
Financial Officer

      


      Telephone:  (703)
709-6718

      Facsimile:  (703)
709-6779

      


      
        
          
          

        

        
           BOND
PURCHASE AGREEMENT - page 27

          
            

          

        

        
          
          

          RUS

        

      

         with a copy
to:

      


      National
Rural Utilities Cooperative

        Finance
Corporation

      2201
Cooperative Way

      Herndon,
VA  20171-3025

      


      Attention:  General
Counsel

      


      Telephone:  (703)
709-6712

      Facsimile:  (703)
709-6811

      


      To
RUS:

      


      Rural
Utilities Service

      U.S.
Department of Agriculture

      1400
Independence Avenue, SW

      Washington,
DC  20250

      


      Attention:  Administrator

      


      Telephone:  (202)
720-9540

      Facsimile:  (202)
720-1725

      


      


      The
address, telephone number, or facsimile number for any party may be changed at
any time and from time to time upon written notice given by such changing party
to the other party hereto.

      


      15.1.2  Permitted Means of
Delivery.  A properly addressed Advance Request, Advance
Request Approval Notice, other notice, or other communication to FFB shall be
deemed to have been delivered if it is sent by facsimile (fax)
transmission.  A properly addressed notice or other communication to
the Borrower shall be deemed to have been delivered if it is sent by facsimile
(fax) transmission.  A properly addressed Advance Request, notice, or
other communication to RUS shall be deemed to have been delivered if it is sent
by facsimile (fax) transmission, provided that RUS shall receive the original of
such faxed Advance Request, notice, or other communication within 5 Business
Days.

      


      15.1.3  Effective Date of
Delivery.  A properly addressed notice or other communication
shall be deemed to have been "delivered" for purposes of this
Agreement:

      


      (a) if
made by personal delivery, on the date of such personal delivery;

      


      (b) if
mailed by first class mail, registered or certified mail, express mail, or by
any commercial 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 28

          
            

          

        

        
          
          

          RUS

        

      

      overnight
courier service, on the date that such mailing is received;

      


      (c) if
sent by facsimile (fax) transmission:

      


      (1) if
the transmission is received and receipt confirmed before 4:00 p.m. (Washington,
DC, time) on any Business Day, on the date of such transmission;
and

      


      (2) if
the transmission is received and receipt confirmed after 4:00 p.m. (Washington,
DC, time) on any Business Day or any day that is not a Business Day, on the next
Business Day.

      


      15.1.4  Notices to FFB to Contain
FFB Identification References.  All notices to FFB making any
reference to either the Bond or any Advance made thereunder shall identify the
Bond or such Advance by the Bond Identifier or the respective Advance
Identifier, as the case may be, assigned by FFB to the Bond or such
Advance.

      


      Section
15.2  Amendments.

      


      15.2.1  This
Agreement.  No provision of this Agreement may be amended,
modified, supplemented, waived, discharged, or terminated orally but only by an
instrument in writing duly executed by each of the parties hereto.

      


      15.2.2  Bond Guarantee
Agreement.  RUS and the Borrower agree that they will not enter
into any amendment, modification, or waiver of section 9.9 of the Bond Guarantee
Agreement, or the consequences of a breach thereof, without the prior written
consent of FFB.

      


      Section
15.3  Successors and
Assigns.  

      


      This
Agreement shall be binding upon and inure to the benefit of each of FFB, the
Borrower, and RUS, and each of their respective successors and
assigns.

      


      Section
15.4  Sale
or Assignment of Bond.

      


      15.4.1  Sale or Assignment
Permitted.  Subject to the agreement in the immediately
following sentence, FFB may sell, assign, or otherwise transfer all or any part
of the Bond or any participation share thereof.  FFB agrees not to
sell, assign, or otherwise transfer all or any part of the Bond or all or any
part of the right to receive the principal of and interest on the Bond or any
participation share thereof to a purchaser, assignee, or transferee that is not
an agency or instrumentality of the United States or a trust fund or other
government account under the authority 

       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 29

          
            

          

        

        
          
          

          RUS

        

      

      or
control of the United States or any officer or officers thereof until such time
as FFB and RUS have agreed upon mutually satisfactory arrangements for the
servicing of the right to receive principal and interest payments on the Bond or
Bonds and for making claims under the RUS Guarantee when FFB is not the
Holder.

      


      15.4.2  Notice of Sale,
Etc.  FFB will deliver to the Borrower and RUS written notice
of any sale, assignment, or other transfer of the Bond promptly after any such
sale, assignment, or other transfer.

      


      15.4.3  Manner of Payment after
Sale.  Any sale, assignment, or other transfer of all or any
part of the Bond may provide that, following such sale, assignment, or other
transfer, payments on the Bond, with the exception of the fee described in
paragraph 9 of the Bond, shall be made in the manner specified by the
respective purchaser, assignee, or transferee, as the case may
be.  Payments of the fee described in paragraph 9 of the Bond shall be
made in the manner specified by FFB in the written notice of the sale,
assignment, or other transfer delivered by FFB to the Borrower and RUS as
provided in section 15.4.2 of this Agreement.

      


      15.4.4  Replacement
Bonds.  

      


      (a) Borrower's
Agreement.  The Borrower agrees:

      


      (1) to
issue a replacement Bond or Bonds with the same aggregate principal amount,
interest rate, maturity, and other terms as each respective Bond or Bonds sold,
assigned, or transferred pursuant to section 15.4.1 of this Agreement; provided, however, that, when
requested by the respective purchaser, assignee, or transferee, such replacement
Bond or Bonds shall provide that payments thereunder shall be made in the manner
specified by such purchaser, assignee, or transferee; and provided, further, however, that upon
delivery of such replacement Bond, the Borrower shall be released and discharged
from any further liability on account of the sold, assigned, or transferred
Bond; and provided, further, however, that the
Bond being replaced shall be surrendered to the Borrower for cancellation; and


      


      (2) to
effect the change in ownership on its records and on the face of each such
replacement Bond issued, upon receipt of each Bond or Bonds so sold, assigned,
or transferred.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 30

          
            

          

        

        
          
          

          RUS

        

      

      (b) RUS's Agreement.  If FFB
elects to sell, assign, or transfer all or any part of the Bond or any
participation share thereof, and if the respective purchaser, assignee, or
transferee requests the Borrower to issue a replacement Bond or Bonds as
provided in section 15.4.4(a) of this Agreement, RUS agrees that it will, upon
the written request of FFB, execute and deliver an RUS Guarantee of the
replacement Bond in replacement of the RUS Guarantee of the sold, assigned, or
transferred Bond.

      


      (c) FFB's Agreement.  FFB
agrees that, upon delivery by RUS of a replacement RUS Guarantee as provided in
section 15.4.4(b) of this Agreement, RUS shall be released and discharged from
any further liability on account of the RUS Guarantee of the sold, assigned, or
transferred Bond.

      


      Section
15.5  Forbearance Not a
Waiver.

      


      Any
forbearance on the part of FFB from enforcing any term or condition of this
Agreement shall not be construed to be a waiver of such term or condition or
acquiescence by FFB in any failure on the part of Borrower to comply with or
satisfy such term or condition.

      


      Section
15.6  Rights
Confined to Parties.

      


      Nothing
expressed or implied herein is intended or shall be construed to confer upon, or
to give to, any Person other than FFB, the Borrower, and RUS, and their
respective successors and permitted assigns, any right, remedy, or claim under
or by reason of this Agreement or of any term, covenant, or condition hereof,
and all of the terms, covenants, conditions, promises, and agreements contained
herein shall be for the sole and exclusive benefit of FFB, the Borrower, and
RUS, and their respective successors and permitted assigns.

      


      Section 15.7  Governing
Law. 


      


      This
Agreement and the rights and obligations of the parties hereunder shall be
governed by, and construed and interpreted in accordance with, the laws of the
United States of America and not the law of the several States.

      


      Section 15.8  Severability.  

      


      Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any


       

      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 31

          
            

          

        

        
          
          

          RUS

        

      

      jurisdiction
shall not of itself invalidate or render unenforceable such provision in any
other jurisdiction.

      


      Section 15.9  Headings.  

      


      The
descriptive headings of the various articles, sections, and subsections of this
Agreement were formulated and inserted for convenience only and shall not be
deemed to affect the meaning or construction of the provisions
hereof.

      


      Section 15.10  Counterparts.  

      


      This
Agreement may be executed in separate counterparts, each of which when so
executed and delivered shall be an original, but all of which together shall
constitute but one and the same instrument.

      


      
        
          
          

        

        
          BOND
PURCHASE AGREEMENT - page 32

          
            

          

        

        
          
          

          RUS

        

      

      IN WITNESS WHEREOF, FFB, the
Borrower, and RUS have each caused this Agreement to be executed as of the day
and year first above mentioned.

      


      


      FEDERAL
FINANCING BANK

        ("FFB")

       

      


      By:    /s/ MEREDITH M. BROOME

      


      Name: 
Meredith M. Broome

      


      Title:
Vice President and Treasurer

      


      


      


      NATIONAL
RURAL UTILITIES

      COOPERATIVE
FINANCE CORPORATION

        (the
"Borrower")

      


       

      By:     /s/ SHELDON C. PETERSEN

      


      Name:   Sheldon
C. Petersen

      


      Title:  Governor and

                     
                   Chief
Executive Officer

      


      


      ADMINISTRATOR of the


      RURAL UTILITIES SERVICE


        ("RUS")

      


       

      By:     /s/ JAMES M. ANDREW

      


      Name:   James
M. Andrew

      


      Title: 
Administrator

      
        


        
          
            
            

          

          
            BOND
PURCHASE AGREEMENT - page 33

            
              

            

          

          
            
            

            RUS


            


             

            


            


            


            


            


            


            


            


            EXHIBIT
A

            


            TO

            


            BOND
PURCHASE AGREEMENT

            


            


            


            


            FORM

            


            OF

            


            ADVANCE
REQUEST

             

             

             

             

             

            


            


            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

                RUS

              

            

             

            
               

              ADVANCE
REQUEST

              (RUS
APPROVAL REQUIRED)

              


              ****************************************************************

              


              REFER
TO RURAL UTILITIES SERVICE (RUS) REGULATIONS AND INSTRUCTIONS FOR A DESCRIPTION
OF (1) THE OTHER FORMS AND MATERIALS THAT ARE REQUIRED IN CONNECTION WITH
EACH REQUEST FOR AN ADVANCE, AND (2) THE TIME LIMITS FOR SUBMITTING THOSE FORMS
AND MATERIALS AND THIS ADVANCE REQUEST TO RUS.

              


              DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE BORROWER:


              


              Chief

              Policy
Analysis and Loan Management Staff

              Telephone:  (202)
720-0424

              


              WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM
(TOGETHER WITH ALL OTHER FORMS AND MATERIAL REQUIRED BY RUS) TO RUS AT THE ADDRESS
OF THE CONTACT OFFICE INDICATED BELOW:

              


              Chief

              Policy
Analysis and Loan Management Staff

              Rural
Utilities Service

              U.S.
Department of Agriculture

              Mail
Stop 1560

              1400
Independence Avenue, SW

              Washington,
DC  20250-1560

              


              Reference:  Section
313A Loan Guarantee

              


              Telephone:  (202)
720-0424

              Facsimile:   (202)
690-0717

              


              ****************************************************************

              


              
                
                  
                  

                

                
                  Advance
Request - page 1

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              
                ADVANCE
REQUEST

                


                 

                


                Manager

                Federal
Financing Bank

                


                


                


                Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                 

                Name of
Borrower (the "Borrower"):

                 

                National Rural Utilities
Cooperative Finance Corporation 

                


                 

                FFB Bond
Identifier:              _____________________1

                


                The undersigned, as an authorized
officer of the Borrower, hereby requests FFB to make an advance of funds ("this
Advance") under, pursuant to, and in accordance with the applicable terms of the
Bond.

                


                The undersigned further requests that
this Advance be made as follows:

                


                


                1.    Requested
Advance Amount:$        _____________________2

                


                


                2.    Requested
Advance
Date:                               
 _____________________3

                


                
 _________________________

              

              
                1Insert
the Bond Identifier that FFB assigned to the Bond (as provided in
section 5.1(a)(2) of the Bond Purchase Agreement referred to in the
Bond).

                2Insert
the particular amount of funds that the Borrower requests to be advanced, which
amount must satisfy the condition specified in section 7.3.4 of the Bond
Purchase Agreement referred to in the Bond.

                      3Insert the particular
calendar date that the Borrower requests to be date on which this Advance is to
be made, which date must meet the criteria for Requested Advance Dates specified
in section 7.3.1(a)(3) of the Bond Purchase Agreement referred to in the
Bond.

              

              


              
                
                  
                  

                

                
                  Advance
Request - page 2

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              
                3.    Wire
Instructions:

                


                


                A.  CORRESPONDENT BANK (if
any) FOR PAYEE'S BANK:

                


                Name of financial institution
______________________________

                


                Address of financial
institution   ______________________________

                


                ABA number of financial
institution    ______________________________

                


                


                B.  PAYEE'S BANK AND
ACCOUNT:

                


                Name of financial institution
______________________________

                


                Address of financial
institution   ______________________________

                


                ABA number of financial
institution    ______________________________

                


                Account
name    ______________________________

                


                Account
number      ______________________________

                


                Taxpayer ID number
______________________________

                 

                
                  4.Maturity
Date:  _________________________4

                   

                  
                    ____________________

                    4Insert
the particular calendar date that the Borrower selects to be the date on which
this Advance is to mature, which date must meet all of the criteria for Maturity
Dates specified in section 7.3.1(a)(5) of the Bond Purchase Agreement referred
to in the Bond.

                  

                

                
                  
 

                

              

              
                
                  
                  

                

                
                  Advance
Request - page 3

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              5.    Prepayment/Refinancing
Privilege:

              


              
                	
                         
      

                      	
                        If
      (and only
      if) the Borrower selects, as the "Maturity Date" for this Advance,
      a date that will occur on or after the
      fifth anniversary of the "Requested Advance Date," then the Borrower must elect
      1 of the
      following 2 alternative prepayment/refinancing
  privileges.

                      


              

              


              
                	
                         
      

                      	
                        !Alternative
      Prepayment/Refinancing Privileges:

                      


              

               

                   "M"
for the "Market
Value Prepayment/     _____  5

                      
Refinancing Privilege

              


                   "F"
for the "Fixed
Premium Prepayment/     _____  6

                            Refinancing
Privilege

               

              If
(and only if)
the Borrower elects the "Fixed Premium
Prepayment/ Refinancing Privilege," then the Borrower must elect 1 of the following 2
alternative no-call period options.

              


              
                	
                         
      

                      	
                        "Alternative
      No-Call Period Options:

                      


              

               

              "Y" for "yes," if the privilege is    6

                  to
include a 5-year No-Call Period

              
                	
                      


              

                  

              "N" for "no," if the privilege is
not  

                                 to
include a 5-year No-Call Period

               

              ____________________________

              
                     5Insert in the box "M" if the
Borrower elects to have the Market Value Prepayment/Refinancing Privilege apply
to this Advance.  Insert in the box "F" if the Borrower elects to have
a Fixed Premium Prepayment/Refinancing Privilege apply to this
Advance.

                 

                6Insert
in the box "Y" if the Borrower elects to have the Fixed Premium
Prepayment/Refinancing Privilege include a 5-year No-Call Period during which
this Advance will not be eligible for prepayment or
refinancing.  Insert in the box "N" if the Borrower elects to have the
Fixed Premium Prepayment/Refinancing Privilege not include any
5-year No-Call Period, i.e. this Advance will be eligible for prepayment or
refinancing on any Business day.

              

              
                
                  
                  

                

                
                  Advance
Request - page 4

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              


              If
(and only if)
the Borrower elects the "Fixed Premium
Prepayment/ Refinancing Privilege, then the borrower must select 1 of the following 3
alternative premium options.

              


              "Alternative
Premium Options:

               

                                                 "X"
for 10% premium declining over   
_____7

              
                	 
      


              

                          10
years                              

                 "V"
for 5% premium declining over

                5 years

              


                 "P" for par (no
premium)

               

              


              The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Advance Request on
behalf of the Borrower is valid and in full force and effect on the date
hereof.

              


               

              NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION

              (the "Borrower")

              
 

              By:     _______________________

              


              Name:   _______________________

              


              Title: 
_______________________

              


              Date:   _______________________

              __________________________

              
                7Insert
in the box "X" if the Borrower selects a 10% premium declining over 10 years as
the premium option for the Fixed Premium Prepayment/Refinancing Privilege that
is to apply to this Advance.  Insert in the box "V" if the Borrower
selects a 5% premium declining over 5 years as the premium option for the Fixed
Premium Prepayment/Refinancing Privilege that is to apply to this
Advance.  Insert in the box "P" if the Borrower selects par (no
premium) as the premium option for the Fixed Premium Prepayment/Refinancing
Privilege that is to apply to this Advance.

              

              
                
                  
                  

                

                
                  Advance
Request - page 5

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

               

              


              NOTICE
OF RUS APPROVAL OF

              ADVANCE
REQUEST

              


              


              Notice is hereby given to FFB that the
preceding Advance Request made by the Borrower identified therein has been
approved by RUS for purposes of the Bond identified therein.

              


              
                
                  	 
      	 
      	 
      
	
                          FOR
      ACCOUNTING

                        	 
      	 
      
	
                          USE
      ONLY:

                        	 
      	
                          ADMINISTRATOR
      of the

                        
	 
      	 
      	
                          RURAL
      UTILITIES SERVICE,

                        
	 
      	 
      	
                          acting
      through his or her

                        
	
                          RUS
      Budget

                        	 
      	
                          duly
      authorized designee

                        
	
                          Account

                        	 
      	 
      
	
                          Number

                        	 
      	 
      
	 
      	 
      	 
      
	
                           ___________________

                        	 
      	 
      
	 
      	 
      	 
      


                

              

               

              By:     _______________________

              


              Name:   _______________________

              


              Title: 
_______________________

              


              Date:   _______________________

               

              
                
                  
                  

                

                
                  Advance
Request - page 6

                  
                    

                  

                

                
                  
                  

                

              

              

                
 

                 

                 

                


                


                


                


                EXHIBIT
B

                


                TO

                


                BOND
PURCHASE AGREEMENT

                


                


                


                


                FORM

                


                OF

                


                BOND

                
 

              

            

            


            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            


            
              
                
                  	 
      	 
      	
                          Bond

                        
	
                          FOR
      FFB USE ONLY

                        	 
      	
                          Date            September
      9,2008

                        
	 
      	 
      	 
      
	
                          Bond
      Identifier:

                        	 
      	
                          Place

                        
	 
      	 
      	
                          of

                        
	 
      	 
      	
                          Issue           Washington,
      DC

                        
	 
      	 
      	 
      
	
                          Purchase
      Date:

                        	 
      	
                          Last
      Day

                        
	 
      	 
      	
                          for
      an

                        
	 
      	 
      	
                          Advance
      (¶3)    October 15, 2011

                        
	 
      	 
      	 
      
	 
      	 
      	
                          Maximum

                        
	 
      	 
      	
                          Principal

                        
	 
      	 
      	
                          Amount
      (¶4)     $500,000,000.00

                        
	 
      	 
      	 
      
	 
      	 
      	
                          Final

                        
	 
      	 
      	
                          Maturity

                        
	 
      	 
      	
                          Date
      (¶5)       October 15,
    2031

                        


                


                 

              

              
                FUTURE ADVANCE BOND

                SERIES C

                


                


                


                1.    Promise to
Pay.

                


                FOR VALUE RECEIVED, NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION, a cooperative association existing under the laws of
the District of Columbia (the "Borrower," which term
includes any successors or assigns) promises to pay the FEDERAL FINANCING BANK ("FFB"), a body
corporate and instrumentality of the United States of America (FFB, for so long
as it shall be the holder of this Bond, and any successor or assignee of FFB,
for so long as such successor or assignee shall be the holder of this Bond,
being the "Holder"), at the
times, in the manner, and with interest at the rates to be established as
hereinafter provided, such amounts as may be advanced from time to time by FFB
to the Borrower under this Bond (each such amount being an "Advance", and more
than one such amount being "Advances").

                 

                
                  2.    Reference to Certain
Agreements.

                   

                

                (a)  Bond Purchase
Agreement.  This Bond is the "Bond" referred to in, and
entitled to the benefits of, the Series C Bond Purchase Agreement dated as of
even date herewith, made by and among FFB, the Borrower, and the Administrator
of the Rural Utilities Service, a Rural Development agency of the United


                 

                
                  
                    
                    

                  

                  
                    Bond
- page 1

                    
                      

                    

                  

                  
                    
                    

                  

                

                States
Department of Agriculture ("RUS") (such
agreement, as it may be amended, supplemented, and restated from time to time in
accordance with its terms, being the "Bond Purchase
Agreement").

                


                (b) Bond Guarantee
Agreement.  This Bond is the "Bond" referred to in, and
entitled to the benefits of, the Series C Bond Guarantee Agreement dated as of
even date herewith, made between RUS and the Borrower (such agreement, as it may
be amended, supplemented, and restated from time to time in accordance with its
terms, being the "Bond
Guarantee Agreement").

                


                (c) Pledge
Agreement.  This Bond is the "Bond" referred to in the Pledge
Agreement dated as of even date herewith, made among the Borrower, RUS, and U.S.
Bank Trust National Association, a national association (such agreement, as it
may be amended, supplemented, and restated from time to time in accordance with
its terms, being the "Pledge
Agreement").

                 

                
                  3.    Advances; Advance Requests;
RUS Approval Requirement; Last Day for an Advance.

                

                 

                (a) Subject to the terms and conditions
of the Bond Purchase Agreement, FFB shall make Advances to the Borrower from
time to time under this Bond, in each case upon delivery to FFB of a written
request by the Borrower for an Advance under this Bond, in the form of request
attached to the Bond Purchase Agreement as Exhibit A thereto (each such request
being an "Advance
Request") and completed as prescribed in section 7.3.1 of the Bond
Purchase Agreement.

                


                (b) To be effective, an Advance Request
must first be delivered to RUS for approval and be approved by RUS in writing,
and such Advance Request, together with written notification of RUS's approval
thereof (each such notification being an "Advance Request Approval
Notice"), must be received by FFB consistent with the advance notice
requirements prescribed in section 7.3.2(b) of the Bond Purchase Agreement.


                


                (c) FFB shall make each requested
Advance on the particular calendar date that the Borrower requested in the
respective Advance Request to be the date on which the respective Advance is to
be made (such date being the "Requested Advance
Date" for such Advance), subject to the provisions of the Bond Purchase
Agreement describing certain circumstances under which a requested Advance shall
be made on a later date; provided, however, that no
Advance shall be made under this Bond after the particular date specified on
page 1 of this Bond as being the "Last Day for an Advance."

                


                4.    Principal Amount of
Advances; Maximum Principal Amount.

                


                The principal amount of each Advance
shall be the particular dollar amount that the Borrower specified in the


                 

                
                  
                    
                    

                  

                  
                    Bond
- page 2

                    
                      

                    

                  

                  
                    
                    

                  

                

                respective
Advance Request as the "Requested Advance Amount" for the respective Advance;
provided, however, that the
aggregate principal amount of all Advances made under this Bond shall not exceed
the particular amount specified on page 1 of this Bond as being the "Maximum
Principal Amount."  

                 

                
                  5.    Maturity
Dates for Advances.

                

                 

                Subject to paragraph 15 of this Bond,
each Advance shall mature on the particular calendar date that the Borrower
selected in the respective Advance Request to be the date on which the
respective Advance is to mature (such date being the "Maturity Date" for
such Advance), provided that such Maturity Date meets all of the criteria for
Maturity Dates prescribed in section 7.3.1(a)(5) of the Bond Purchase
Agreement.

                


                6.    Computation of Interest on
Advances.

                


                (a) Subject to paragraphs 11 and 16 of
this Bond, interest on the outstanding principal of each Advance shall accrue
from the date on which the respective Advance is made to the date on which such
principal is due.

                


                (b) Interest on each Advance shall be
computed on the basis of (1) actual days elapsed from (but not including) the
date on which the respective Advance is made (for the first payment of interest
due under this Bond for such Advance) or the date on which the payment of
interest was last due (for all other payments of interest due under this Bond
for such Advance), to (and including) the date on which the payment of interest
is next due; and (2) a year of 365 days (except in calendar years including
February 29, when the basis shall be a 366-day year).

                


                (c) The basic interest rate for each
Advance shall be established by FFB, as of the date on which the respective
Advance is made, on the basis of the determination made by the Secretary of the
Treasury pursuant to section 6(b) of the Federal Financing Bank Act of 1973, as
amended (codified at 12 U.S.C. § 2281 et seq.) (the "FFB Act"); provided, however, that the
shortest maturity used as the basis for any rate determination shall be the
remaining maturity of the most recently auctioned  United States
Treasury bills having the shortest maturity of all United States Treasury bills
then being regularly auctioned.  

                


                (d) In
the event that (1) the Borrower has selected for any Advance a Maturity Date
that will occur on or after the fifth anniversary of the Requested Advance Date
for such Advance, and (2) the Borrower has elected for such Advance a
prepayment/ refinancing privilege described in section 11.3 of the Bond Purchase
Agreement, then the interest rate for such Advance shall also include a price
(expressed in terms of a basis point increment to the applicable basic interest
rate) for the particular prepayment/refinancing privilege that the Borrower


                 

                
                  
                    
                    

                  

                  
                    Bond
- page 3

                    
                      

                    

                  

                  
                    
                    

                  

                

                selected,
which price shall be established by FFB on the basis of a determination made by
FFB as to the difference between (A) the estimated market yield of a
notional obligation if such obligation were to (i) be issued by the Secretary of
the Treasury, (ii) have a maturity comparable to the maturity of such Advance,
and (iii) include a prepayment and refinancing privilege identical to the
particular prepayment/refinancing privilege that the Borrower
elected for such Advance, and (B) the estimated market yield of a notional
obligation if such obligation were to (i) be issued by the Secretary of the
Treasury, (ii) have a maturity comparable to the maturity of such Advance, but
(iii) not include such prepayment and refinancing privilege.

                


                7.    Payment of Interest; Payment
Dates.

                


                Interest accrued on the outstanding
principal amount of each Advance shall be due and payable quarterly on January
15, April 15, July 15, and October 15 of each year (each such day being a
"Payment
Date"), beginning on the first Payment Date to occur after the date on
which the respective Advance is made, up through and including the Maturity Date
of such Advance; provided, however, that with
respect to each Advance that is made in the 30-day period immediately preceding
any Payment Date, payments of accrued interest on the outstanding principal
amount of the respective Advance shall be due beginning on the second Payment
Date to occur after the date on which such Advance is made. 

                


                8.    Repayment of
Principal.

                


                Subject to paragraph 15 of this Bond,
the principal amount of each Advance shall be payable on the Maturity Date for
the respective Advance.

                


                9.    Fee.

                


                (a)  A fee to cover expenses
and contingencies, assessed by FFB pursuant to section 6(c) of the FFB Act,
shall accrue on the outstanding principal amount of each Advance for the period
from the date on which the respective Advance is made to the date on which the
principal amount of such Advance is due, not taking into account any maturity
extensions permitted by paragraph 15 of this Bond (such period being the "Advance
Period").  

                


                (b) The fee on each Advance shall
be:

                


                (1) 22.5
basis points (0.225%) per annum of the unpaid
principal balance of such Advance for an Advance Period of a year or
less;

                


                (2) 27.5
basis points (0.275%) per annum of the unpaid
principal balance of such Advance for an Advance Period greater than a year but
no more than 5 years; and 

                


                
                  
                    
                    

                  

                  
                    Bond
- page 4

                    
                      

                    

                  

                  
                    
                    

                  

                

                (3) 35
basis points (0.35%) per annum of the unpaid
principal balance of such Advance for an Advance Period greater than 5
years.  

                


                (c) The
fee on each Advance shall be computed in the same manner as accrued interest is
computed under paragraph 6(b) of this Bond, and shall be due and payable at the
same times as accrued interest is due and payable under paragraph 7 of this Bond
(adjusted as provided in paragraph 10 of this Bond if a Payment Date is not a
Business Day).  The fee on each Advance shall be credited to RUS as
required by section 505(c) of the Federal Credit Reform Act of 1990, as amended
(codified at 2 U.S.C. § 661d(c)).

                


                10.    Business
Days.

                


                (a) Whenever any Payment Date, the
Maturity Date for any Advance, or the Final Maturity Date shall fall on a day on
which either FFB or the Federal Reserve Bank of New York is not open for
business, the payment that would otherwise be due on such Payment Date, Maturity
Date, or Final Payment Date, as the case may be, shall be due on the first day
thereafter on which FFB and the Federal Reserve Bank of New York are both open
for business (any such day being a "Business
Day").  

                


                (b) In the event that any Payment Date
falls on a day other than a Business Day, then the extension of time for making
the payment that would otherwise be due on such Payment Date shall be (1) taken
into account in establishing the interest rate for the respective Advance, (2)
included in computing interest due in connection with such payment, and (3)
excluded in computing interest due in connection with the next
payment.

                


                (c) In the event that the Maturity Date
for any Advance or the Final Maturity Date falls on a day other than a Business
Day, then the extension of time for making the payment that would otherwise be
due on such Maturity Date or the Final Maturity, as the case may be, shall be
(1) taken into account in establishing the interest rate for such Advance, and
(2) included in computing interest due in connection with such
payment.

                


                11.    Late
Payments.

                


                (a) In the event that any payment of
any amount owing under this Bond is not made when and as due (any such amount
being then an "Overdue
Amount"), then the amount payable shall be such Overdue Amount plus
interest thereon (such interest being the "Late Charge")
computed in accordance with this subparagraph (a).

                


                (1) The Late Charge shall accrue from
the scheduled date of payment for the Overdue Amount (taking into account


                 

                
                  
                    
                    

                  

                  
                    Bond
- page 5

                    
                      

                    

                  

                  
                    
                    

                  

                

                paragraph
10 of this Bond) to the date on which payment is made.

                


                (2) The Late Charge shall be computed
on the basis of (A) actual days elapsed from (but not including) the scheduled
date of payment for such Overdue Amount (taking into account paragraph 10 of
this Bond) to (and including) the date on which payment is made, and (B) a year
of 365 days (except in calendar years including February 29, when the basis
shall be a 366-day year).

                


                (3) The Late Charge shall accrue at a
rate (the "Late Charge
Rate") equal to one and one-half times the rate to be determined by the
Secretary of the Treasury taking into consideration the prevailing market yield
on the remaining maturity of the most recent auctioned 13-week United States
Treasury bills.  

                


                (4) The initial Late Charge Rate shall
be in effect until the earlier to occur of either (A) the date on which payment
of the Overdue Amount and the amount of accrued Late Charge is made, or (B) the
first Payment Date to occur after the scheduled date of payment for such Overdue
Amount.  In the event that the Overdue Amount and the amount of the
accrued Late Charge are not paid on or before such Payment Date, then the amount
payable shall be the sum of the Overdue Amount and the amount of the accrued
Late Charge, plus a Late Charge on such sum accruing at a new Late Charge Rate
to be then determined in accordance with the principles of clause (3) of this
subparagraph (a).  For so long as any Overdue Amount remains unpaid,
the Late Charge Rate shall be re-determined in accordance with the principles of
clause (3) of this subparagraph (a) on each Payment Date to occur thereafter,
and shall be applied to the Overdue Amount and all amounts of the accrued Late
Charge to the date on which payment of the Overdue Amount and all amounts of the
accrued Late Charge is made.

                


                (b) Nothing in subparagraph (a) of this
paragraph 11 shall be construed as permitting or implying that the Borrower may,
without the written consent of FFB, modify, extend, alter or affect in any
manner whatsoever (except as explicitly provided herein) the right of FFB to
receive any and all payments on account of this Bond on the dates specified in
this Bond.

                


                12.    Final Due
Date.

                


                Notwithstanding anything in this Bond
to the contrary, all amounts outstanding under this Bond remaining unpaid as of
the Final Maturity Date shall be due and payable on the Final Maturity
Date.

                


                
                  
                    
                    

                  

                  
                    Bond
- page 6

                    
                      

                    

                  

                  
                    
                    

                  

                

                13.    Manner of Making
Payments.

                


                (a) For so long as FFB is the Holder of
this Bond and RUS is the bond servicing agent for FFB (as provided in the Bond
Purchase Agreement), each payment under this Bond shall be paid in immediately
available funds by electronic funds transfer to the account of the United States
Treasury (for credit to the subaccount of RUS, as bond servicing agent for FFB)
maintained at the Federal Reserve Bank of New York specified by RUS in a written
notice to the Borrower, or to such other account as may be specified from time
to time by RUS in a written notice to the Borrower.

                


                (b) In the event that FFB is the Holder
of this Bond and RUS is not the bond
servicing agent for FFB, each payment under this Bond, with the exception of the
fee described in paragraph 9 of this Bond, shall be paid in immediately
available funds by electronic funds transfer to the account of the United States
Treasury (for credit to the subaccount of FFB) maintained at the Federal Reserve
Bank of New York specified by FFB in a written notice to the Borrower, or to
such other account as may be specified from time to time by FFB in a written
notice to the Borrower.  In the event that FFB is the Holder of this
Bond and RUS is not the bond
servicing agent for FFB, each payment of the fee described in paragraph 9 of
this Bond shall be paid in immediately available funds by electronic funds
transfer to the account of the United States Treasury (for credit to the
subaccount of RUS) maintained at the Federal Reserve Bank of New York specified
from time to time by RUS in a written notice delivered by RUS to the
Borrower.

                


                (c) In the event that FFB is not the Holder of
this Bond, then each payment under this Bond, with the exception of the fee
described in paragraph 9 of this Bond, shall be made in immediately
available funds by electronic funds transfer to such account as shall be
specified by the Holder in a written notice to the Borrower.  In the
event that FFB is not the Holder of
this Bond, each payment of the fee described in paragraph 9 of this Bond shall
be made in the manner specified by FFB in the written notice delivered by FFB to
the Borrower and RUS as provided in section 15.4.2 of the Bond Purchase
Agreement.

                


                14.    Application of
Payments.

                


                Each payment made on this Bond shall be
applied, first, to the payment of Late Charges (if any) payable under paragraphs
11 and 18 of this Bond, then to the payment of premiums (if any) payable under
paragraphs 16 and 17 of this Bond, then to the payment of unpaid accrued
interest, then on account of outstanding principal, and then to the payment of
the fee payable under paragraph 9 of this Bond.

                
                  
                    
                    

                  

                  
                    Bond
- page 7

                    
                      

                    

                  

                  
                    
                    

                  

                

                


                15.    Maturity
Extensions.

                


                (a) With respect to each Advance (1)
for which the Borrower has selected a Maturity Date that will occur before the
twentieth anniversary of the Requested Advance Date specified in the respective
Advance Request, or (2) for which a Maturity Date that will occur before the
twentieth anniversary of the Requested Advance Date specified in the respective
Advance Request has been determined as provided in subparagraph (b) of this
paragraph 15 (each such Maturity Date being an "Interim Maturity
Date"), the Borrower may, effective as of such Interim Maturity Date,
elect to extend the maturity of all or any portion of the outstanding principal
amount of the respective Advance to a new Maturity Date to be selected by the
Borrower in the manner and subject to the limitations specified in this
subparagraph (a) (each such election being a "Maturity Extension
Election"; each such elective extension of the maturity of any Advance
that has an Interim Maturity Date being a "Maturity Extension";
and the Interim Maturity Date that is in effect for an Advance immediately
before any such elective Maturity Extension being, from and after such Maturity
Extension, the "Maturity Extension Effective
Date").  

                


                (1) Except under the circumstances
described in clause (3) of this subparagraph (a), the Borrower shall
deliver to FFB (with a copy to RUS) written notification of each Maturity
Extension Election, in the form of notification attached to this Bond as Annex 1-A (each such
notification being a "Maturity Extension Election
Notice"), making reference to the "Advance Identifier" (as that term is
defined in the Bond Purchase Agreement) that FFB assigned to such Advance (as
provided in the Bond Purchase Agreement) and specifying, among other things, the
following: 

                


                (A) the amount of the outstanding
principal of the such Advance with respect to which the Borrower elects to
extend the maturity; and

                


                (B) the new Maturity Date that the
Borrower selects to be in effect for such principal amount after the respective
Maturity Extension Effective Date, which date:

                


                (i) may be either (I) a new Interim
Maturity Date, or (II) the twentieth anniversary of the Requested Advance Date
specified in the original Advance Request (if such twentieth anniversary date is
a Payment Date) or the Payment Date immediately preceding such twentieth
anniversary date (if such twentieth anniversary date is not a Payment Date);
and

                


                
                  
                    
                    

                  

                  
                    Bond
- page 8

                    
                      

                    

                  

                  
                    
                    

                  

                

                (ii) in the event that the Borrower
selects a new Interim Maturity Date as the new Maturity Date for any Advance,
must meet the criteria for Maturity Dates prescribed in section 7.3.1(a)(5) of
the Bond Purchase Agreement (provided, however, that, for
purposes of selecting a new Maturity Date in connection with a Maturity
Extension Election, each of the references to the "Requested Advance Date" for
the respective Advance in section 7.3.1(a)(5)(D) of the Bond Purchase Agreement
shall be deemed to be a reference to the "respective Maturity Extension
Effective Date").

                


                (2) To be effective, a Maturity
Extension Election Notice must be received by FFB on or before the third
Business Day before the Interim Maturity Date in effect for the respective
Advance immediately before such Maturity Extension.

                


                (3) In the event that either of the
circumstances described in subclause (A) or (B) of the next sentence occurs,
then a Maturity Extension Election Notice (in the form of notice attached to
this Bond as Annex
1-B), to be effective, must first be delivered to RUS for approval and be
approved by RUS in writing, and such Maturity Extension Election Notice,
together with written notification of RUS's approval thereof, must be received
by FFB on or before the third Business Day before the Interim Maturity Date in
effect for the respective Advance immediately before such Maturity
Extension.  RUS approval of a Maturity Extension Election Notice will
be required under either of the following circumstances:

                


                (A) (i) any payment of any amount owing
under this Bond is not made by the Borrower when and as due; (ii) payment
is made by RUS in accordance with the guarantee set forth at the end of this
Bond; and (iii) RUS delivers notice to both the Borrower and FFB advising
each of them that each Maturity Extension Election Notice delivered by the
Borrower after the date of such notice shall require the approval of RUS;
or

                


                (B) FFB at any time delivers written
notice to both the Borrower and RUS advising each of them that each Maturity
Extension Election Notice delivered by the Borrower after the date of such
notice shall require the approval of RUS.

                


                (b) With respect to any Advance that
has an Interim Maturity Date, in the event that FFB does not receive a Maturity
Extension Election Notice (and, if required under subparagraph (a)(3) of
this paragraph 15, written notification 

                 

                
                  
                    
                    

                  

                  
                    Bond
- page 9

                    
                      

                    

                  

                  
                    
                    

                  

                

                of RUS's
approval thereof) on or before the third Business Day before such Interim
Maturity Date, then the maturity of such Advance shall be extended automatically
in the manner and subject to the limitations specified in this subparagraph (b)
(each such automatic extension of the maturity of any Advance that has an
Interim Maturity Date also being a "Maturity Extension";
and the Interim Maturity Date that is in effect for an Advance immediately
before any such automatic Maturity Extension also being, from and after such
Maturity Extension, the "Maturity Extension Effective
Date").  The new Maturity Date for such Advance shall be the
immediately following Payment Date.  The amount of principal that will
have its maturity extended automatically shall be the entire outstanding
principal amount of such Advance on such Maturity Extension Effective Date, less
the amount of any payment of principal made on such Maturity Extension Effective
Date.

                


                (c) In the event that the maturity of
any Advance that has an Interim Maturity Date is extended under either
subparagraph (a) or (b) of this paragraph 15, then the basic interest rate
for such Advance, from and after the respective Maturity Extension Effective
Date, shall be the particular rate that is established by FFB, as of such
Maturity Extension Effective Date, in accordance with the principles of
paragraph 6(c) of this Bond.

                


                (d) In
the event that the maturity of any Advance that has an Interim Maturity Date is
extended under either subparagraph (a) or (b) of this paragraph 15, then
the fee for such Advance, from and after the respective Maturity Extension
Effective Date, shall be the particular fee that is assessed by FFB, as of such
Maturity Extension Effective Date, with the new Advance Period being the period
from the Maturity Extension Effective Date through the new Maturity Date, in
accordance with the principles of paragraphs 9(b) and (c) of this
Bond.

                


                (e) In the event that (1) the maturity
of any Advance that has an Interim Maturity Date is extended under either
subparagraph (a) or (b) of this paragraph 15, and (2) the Maturity Date for such
extended Advance is a date that will occur before the fifth
anniversary of the respective Maturity Extension Effective Date, then the
prepayment/refinancing privilege described in section 11.2 of the Bond Purchase
Agreement shall apply automatically to such Advance.

                


                (f) In the event that (1) the Borrower
makes a Maturity Extension Election with respect to any Advance that has an
Interim Maturity Date, and (2) the Borrower selects as the Maturity Date for
such extended Advance a new Maturity Date that will occur on or after the fifth
anniversary of the respective Maturity Extension Effective Date, then the
Borrower must elect a prepayment/refinancing privilege for such extended Advance
from between the options described in sections 11.2 and 11.3 of the Bond
Purchase Agreement (provided, however, that each of
the 

                 

                
                  
                    
                    

                  

                  
                    Bond
- page 10

                    
                      

                    

                  

                  
                    
                    

                  

                

                references
to "the Requested Advance Date for such Advance" in  section 11.3 of
the Bond Purchase Agreement shall be deemed to be a reference to "the respective
Maturity Extension Effective Date").  The Maturity Extension Election
Notice delivered by the Borrower in connection with each such Maturity Extension
Election must also specify the particular prepayment/refinancing privilege that
the Borrower elects for the respective extended Advance.  In the event
that the Borrower elects for any such extended Advance a prepayment/refinancing
privilege described in section 11.3 of the Bond Purchase Agreement, then the
interest rate for such extended Advance, from and after the respective Maturity
Extension Effective Date, shall include a price (expressed in terms of a basis
point increment to the applicable basic interest rate) for the particular
prepayment/refinancing privilege that the Borrower elects, which price shall be
established by FFB, as of such Maturity Extension Effective Date, in accordance
with the principles of paragraph 6(d) of this Bond.  

                


                (g) The maturity of each Advance may be
extended more than once as provided in this paragraph 15, but upon the twentieth
anniversary of the Requested Advance Date specified in the original Advance
Request (if such twentieth anniversary date is a Payment Date) or upon the
Payment Date immediately preceding such twentieth anniversary date (if such
twentieth anniversary date is not a Payment Date), no further Maturity
Extensions may occur.

                


                16.    Prepayments.

                


                (a) The Borrower may elect to prepay
all or any portion of the outstanding principal amount of any Advance made under
this Bond, or to prepay this Bond in its entirety, in the manner, at the price,
and subject to the limitations specified in this paragraph 16 (each such
election being a "Prepayment
Election").

                


                (b) For each Prepayment Election in
which the Borrower elects to prepay a particular amount of the outstanding
principal of an Advance, the Borrower shall deliver to RUS written notification
of the respective Prepayment Election, in the form of notification attached to
this Bond as Annex
2-A (each such notification being a "Prepayment Election
Notice"), making reference to the Advance Identifier that FFB assigned to
the respective Advance (as provided in the Bond Purchase Agreement) and
specifying, among other things, the following: 

                


                (1) the particular date on which the
Borrower intends to make the prepayment on such Advance (such date being the
"Intended Prepayment
Date" for such Advance), which date: 

                


                (A) must be a Business Day;
and

                


                (B) for any Advance for which the
Borrower has selected a fixed premium prepayment/refinancing 

                 

                
                  
                    
                    

                  

                  
                    Bond
- page 11

                    
                      

                    

                  

                  
                    
                    

                  

                

                privilege
that includes a 5-year period during which such Advance shall not be eligible for
any prepayment or refinancing (such time period being a "No-Call Period"), may
not be a date that will occur before the applicable "First Call Date" determined
as provided in section 11.3.2 of the Bond Purchase Agreement (such date being
the "First Call
Date"); and

                


                (2) the amount of principal of the
respective Advance that the Borrower intends to prepay, which amount may be
either:

                


                (A) the total outstanding principal
amount of such Advance; or

                


                (B) an amount less than the total
outstanding principal amount of such Advance (subject to subparagraph (g) of
this paragraph 16) (any such amount being a "Portion").

                


                (c) For each Prepayment Election in
which the Borrower elects to have a particular amount of funds applied by FFB
toward the prepayment of the outstanding principal of an Advance, the Borrower
shall deliver to RUS written notification of the respective Prepayment Election,
in the form of notification attached to this Bond as Annex 2-B (each such
notification also being a "Prepayment Election
Notice"), making reference to the Advance Identifier that FFB assigned to
the respective Advance (as provided in the Bond Purchase Agreement) and
specifying, among other things, the following: 

                


                (1) the particular date on which the
Borrower intends to make the prepayment on such Advance (such date being the
"Intended Prepayment
Date" for such Advance), which date: 

                


                (A) must be a Business Day;
and

                


                (B) for any Advance for which the
Borrower has selected a fixed premium prepayment/refinancing privilege that
includes a 5-year No-Call Period, may not be a date that will occur before the
applicable First Call Date; and

                


                (2) the particular amount of funds that
the Borrower elects to be applied by FFB toward a prepayment of the outstanding
principal amount of such Advance.

                


                (d) To be effective, a Prepayment
Election Notice must be approved by RUS in writing, and such Prepayment Election
Notice, together with written notification of RUS's approval thereof, must be
received by FFB on or before the fifth Business Day before the date specified
therein as the Intended Prepayment Date for the respective Advance or
Portion.

                


                
                  
                    
                    

                  

                  
                    Bond
- page 12

                    
                      

                    

                  

                  
                    
                    

                  

                

                (e) The Borrower shall pay to FFB a
price for the prepayment of any Advance, any Portion of any Advance, or this
Bond in its entirety (such price being the "Prepayment Price" for
such Advance or Portion or this Bond, as the case may be) determined as
follows:

                


                (1) in the event that the Borrower
elects to prepay the entire outstanding principal amount of any Advance, then
the Borrower shall pay to FFB a Prepayment Price for such Advance equal to the
sum of:

                


                (A) the entire outstanding principal
amount of such Advance on the Intended Prepayment Date;

                


                (B) all unpaid interest (and Late
Charges, if any) accrued on such Advance through the Intended Prepayment Date;
and

                


                (C) the amount of the premium or
discount credit (if any) that is required under the particular
prepayment/refinancing privilege that applies to such Advance;

                


                (2) in the event that the Borrower
elects to prepay a Portion of any Advance, then the Borrower shall pay to FFB a
Prepayment Price for such Portion that would equal such Portion's pro rata share
of the Prepayment Price that would be required for a prepayment of the entire
outstanding principal amount of such Advance (determined in accordance with the
principles of clause (1) of this subparagraph (e)); and

                


                (3) in the event that the Borrower
elects to prepay this Bond in its entirety, then the Borrower shall pay to FFB
an amount equal to the sum of the Prepayment Prices for all outstanding Advances
(determined in accordance with the principles of clause (1) of this subparagraph
(e)).

                


                (f) Payment of the Prepayment Price for
any Advance, any Portion of any Advance, or this Bond in its entirety shall be
due to FFB before 3:00 p.m. (Washington, DC, time) on the Intended Prepayment
Date for such Advance or Portion or this Bond, as the case may be.

                


                (g) Each prepayment of a Portion shall,
as to the principal amount of such Portion, be subject to a minimum amount equal
to $100,000.00 of principal.

                


                (h) The Borrower may make more than one
Prepayment Election with respect to an Advance, each such Prepayment Election
being made with respect to a different Portion of such Advance, until such time
as the entire principal amount of such Advance is repaid in full.

                


                
                  
                    
                    

                  

                  
                    Bond
- page 13

                    
                      

                    

                  

                  
                    
                    

                  

                

                17.    Refinancings.

                


                (a) The Borrower may elect to refinance
the outstanding principal amount of any Advance (but not any Portion) in the
manner, at the price, and subject to the limitations specified in this paragraph
17 (each such election being a "Refinancing
Election").

                


                (b) Except under the circumstances
described in subparagraph (d) of this paragraph 17, the Borrower shall
deliver to FFB (with a copy to RUS) written notification of each Refinancing
Election, in the form of notification attached to this Bond as Annex 3-A (each such
notification being a "Refinancing Election
Notice"), making reference to the Advance Identifier that FFB assigned to
the respective Advance (as provided in the Bond Purchase Agreement) and
specifying, among other things, the following: 

                


                (1) the particular date on which the
Borrower intends to refinance the respective Advance (such date being the "Intended Refinancing
Date" for the respective Advance), which date:

                


                (A) must be a Payment Date;
and

                


                (B) for any Advance for which the
Borrower has selected a prepayment/refinancing privilege that includes a 5-year
No-Call Period, may not be a date that will occur before the applicable First
Call Date;

                


                (2) the amount of the outstanding
principal of the respective Advance that the Borrower elects to refinance (which
may not be a Portion); and

                


                (3) the Maturity Date that the Borrower
selects to be in effect for such principal amount after such refinancing, which
date may be:

                


                (A) the Maturity Date that is in effect
for such Advance immediately before such refinancing; or

                


                (B) a new Maturity Date that the
Borrower selects in connection with such Refinancing Election, provided that
such new Maturity Date meets the criteria for Maturity Dates prescribed in
section 7.3.1(a)(5) of the Bond Purchase Agreement (provided, however, that for
purposes of selecting a new Maturity Date in connection with a Refinancing
Election, each of the references to the "Requested Advance Date" for the
respective Advance in section 7.3.1(a)(5)(D) of the Bond Purchase Agreement
shall be deemed to be a reference to the "respective Refinancing Effective
Date").

                


                
                  
                    
                    

                  

                  
                    Bond
- page 14

                    
                      

                    

                  

                  
                    
                    

                  

                

                (c) To be effective, a Refinancing
Election Notice must be received by FFB on or before the fifth Business Day
before the date specified therein as the Intended Refinancing Date.

                


                (d) In the event that either of the
circumstances described in clause (1) or (2) of the next sentence shall have
occurred, then a Refinancing Election Notice (in the form of notice attached to
this Bond as Annex
3-B), to be effective, must first be delivered to RUS for approval and be
approved by RUS in writing, and such Refinancing Election Notice, together with
written notification of RUS's approval thereof, must be received by FFB on or
before the fifth Business Day before the date specified therein to be the
Intended Refinancing Date.  RUS approval of a Refinancing Election
Notice will be required under either of the following
circumstances:

                


                (1) (A) payment of any amount owing
under this Bond is not made by the Borrower when and as due; (B) payment is made
by RUS in accordance with the guarantee set forth at the end of this Bond; and
(C) RUS delivers notice to both the Borrower and FFB advising each of them that
each Refinancing Election Notice delivered by the Borrower after the date of
such notice shall require the approval of RUS; or

                


                (2) FFB at any time delivers written
notice to both the Borrower and RUS advising each of them that each Refinancing
Election Notice delivered by the Borrower after the date of such notice shall
require the approval of RUS.

                


                (e) The Borrower shall pay to FFB a
price for the refinancing of any Advance (such price being the "Refinancing Price"
for such Advance) equal to the sum of:  

                


                (1) all unpaid interest (and Late
Charges, if any) accrued on such Advance through the Intended Refinancing Date;
and

                


                (2) the amount of the premium (if any)
that is required under the particular prepayment/refinancing privilege that
applies to such Advance.

                


                In the
event that (A) the prepayment/refinancing privilege that applies to the
particular Advance being refinanced is the privilege described in section 11.2
of the Bond Purchase Agreement, and (B) the Market Value Premium (or Discount)
that is to be included in the Refinancing Price for such Advance is a discount
on such Advance, then such discount shall be applied by FFB in the manner
requested by the Borrower in a written notice delivered by the Borrower to FFB
and approved by RUS in writing.

                


                (f) Payment of the Refinancing Price
for any Advance shall be due to FFB before 3:00 p.m. (Washington, DC, time) on
the Intended Refinancing Date for such Advance.

                


                
                  
                    
                    

                  

                  
                    Bond
- page 15

                    
                      

                    

                  

                  
                    
                    

                  

                

                (g) In the event that a Refinancing
Election Notice (and, if required under subparagraph (d) of this paragraph 17,
written notification of RUS's approval thereof) is received by FFB on or before
the fifth Business Day before the Intended Refinancing Date specified therein,
then the refinancing of the respective Advance shall become effective on such
Intended Refinancing Date (in such event, the Intended Refinancing Date being
the "Refinancing
Effective Date").  In the event that a Refinancing Election
Notice (and, if required under subparagraph (d) of this paragraph 17, written
notification of RUS's approval thereof) is received by FFB after the fifth
Business Day before the Intended Refinancing Date specified therein, then the
refinancing of the respective Advance shall become effective on the fifth
Business Day to occur after the day on which such Refinancing Election Notice
(and, if required under subparagraph (d) of this paragraph 17, written
notification of RUS's approval thereof) is received by FFB (in such event, the
fifth Business Day to occur after the day on which such Refinancing Election
Notice (and, if required under subparagraph (d) of this paragraph 17, written
notification of RUS's approval thereof) is received by FFB being the "Refinancing Effective
Date"), provided that the Borrower shall have paid to FFB, in addition to
the Refinancing Price required under subparagraph (e) of this paragraph 17, the
interest accrued from the Intended Refinancing Date through such Refinancing
Effective Date.

                


                (h) In the event that the Borrower
makes a Refinancing Election with respect to any Advance, the basic interest
rate for such Advance, from and after the respective Refinancing Effective Date,
shall be the particular rate that is established by FFB, as of such Refinancing
Effective Date, in accordance with the principles of paragraph 6(c) of this
Bond.

                


                (i) In
the event that the Borrower makes a Refinancing Election with respect to any
Advance, then the fee for such Advance, from and after the respective
Refinancing Effective Date, shall be the particular fee that is assessed by FFB,
as of such Refinancing Effective Date, with the new Advance Period being the
period from the Refinancing Effective Date through the new Maturity Date, in
accordance with the principles of paragraphs 9(b) and (c) of this
Bond.

                


                (j) In the event that (1) the Borrower
makes a Refinancing Election with respect to any Advance, and (2) the Borrower
selects as the Maturity Date for such refinanced Advance either (A) the Maturity
Date that is in effect for such Advance immediately before such refinancing, and
such Maturity Date will occur before the fifth
anniversary of the respective Refinancing Effective Date, or (B) a new Maturity
Date that will occur before the fifth
anniversary of the respective Refinancing Effective Date, then the
prepayment/refinancing privilege described in section 11.2 of the Bond Purchase
Agreement shall apply automatically to such Advance. 

                


                
                  
                    
                    

                  

                  
                    Bond
- page 16

                    
                      

                    

                  

                  
                    
                    

                  

                

                (k) In the event that (1) the Borrower
makes a Refinancing Election with respect to any Advance, and (2) the Borrower
selects as the Maturity Date for such refinanced Advance either (A) the Maturity
Date that is in effect for such Advance immediately before such refinancing, and
such Maturity Date will occur on or after the fifth
anniversary of the respective Refinancing Effective Date, or (B) a new Maturity
Date that will occur on or after the fifth
anniversary of the respective Refinancing Effective Date, then the Borrower must
elect a prepayment/refinancing privilege for such refinanced Advance from
between the options described in sections 11.2 and 11.3 of the Bond Purchase
Agreement (provided, however, that each of
the references to the "Requested Advance Date for such Advance" in section 11.3
of the Bond Purchase Agreement shall be deemed to be a reference to the
"respective Refinancing Effective Date").  The Refinancing Election
Notice delivered by the Borrower in connection with each such Refinancing
Election must also specify the particular prepayment/refinancing privilege that
the Borrower elects for the respective refinanced Advance.  In the
event that the Borrower elects for any such refinanced Advance a
prepayment/refinancing privilege described in section 11.3 of the Bond
Purchase Agreement, then the interest rate for such refinanced Advance, from and
after the respective Refinancing Effective Date, shall include a price
(expressed in terms of a basis point increment to the applicable basic interest
rate) for the particular prepayment/refinancing privilege that the Borrower
elects, which increment shall be established by FFB, as of such Refinancing
Effective Date, in accordance with the principles of paragraph 6(d) of this
Bond. 

                


                (l) The Borrower may make more than one
Refinancing Election with respect to any Advance.

                 

                
                  18.    Rescission
of Prepayment Elections and Refinancing Elections; Late Charges for Late
Payments.



                

                (a) The Borrower may rescind any
Prepayment Election made in accordance with paragraph 16 of this Bond or any
Refinancing Election made in accordance with paragraph 17 of this Bond, but only
in accordance with this paragraph 18.

                


                (b) The Borrower shall deliver to both
FFB and RUS written notification of each rescission of a Prepayment Election or
a Refinancing Election (each such notification being an "Election Rescission
Notice") specifying the particular Advance for which the Borrower wishes
to rescind such Prepayment Election or Refinancing Election, as the case may be,
which specification must make reference to both: 

                


                (1) the particular Advance Identifier
that FFB assigned to such Advance (as provided in the Bond Purchase Agreement);
and

                


                
                  
                    
                    

                  

                  
                    Bond
- page 17

                    
                      

                    

                  

                  
                    
                    

                  

                

                (2) the RUS account number for such
Advance.

                


                The
Election Rescission Notice may be delivered by facsimile transmission to FFB at
(202) 622-0707 and to RUS at (202) 720-1401, or at such other facsimile number
or numbers as either FFB or RUS may from time to time communicate to the
Borrower.

                


                (c) To be effective, an Election
Rescission Notice must be received by both FFB and RUS not later than 3:30 p.m.
(Washington, DC, time) on the second Business Day before the Intended Prepayment
Date or the Intended Refinancing Date, as the case may be.

                


                (d) In the event that the Borrower (1)
makes a Prepayment Election in accordance with paragraph 16 of this Bond or a
Refinancing Election in accordance with paragraph 17 of this Bond; (2) does not
rescind such Prepayment Election or Refinancing Election, as the case may be, in
accordance with this paragraph 18; and (3) does not, before 3:00 p.m.
(Washington, DC, time) on the Intended Prepayment Date or Intended Refinancing
Date, as the case may be, pay to FFB the Prepayment Price described in paragraph
16(e) of this Bond or Refinancing Price described in paragraph 17(e) of
this Bond, as the case may be, then a Late Charge shall accrue on any such
unpaid amount from the Intended Prepayment Date or Intended Refinancing Date, as
the case may be, to the date on which payment is made, computed in accordance
with the principles of paragraph 11 of this Bond.

                


                19.    Amendments to
Bond.

                


                To the extent not inconsistent with
applicable law, this Bond, for so long as FFB or its agent is the holder
thereof, shall be subject to modification by such amendments, extensions, and
renewals as may be agreed upon from time to time by FFB and the Borrower, with
the approval of RUS.

                


                20.    Certain
Waivers.

                


                The Borrower hereby waives any
requirement for presentment, protest, or other demand or notice with respect to
this Bond.

                


                21.    Bond Effective Until
Paid.

                


                This Bond shall continue in full force
and effect until all principal outstanding hereunder, all interest accrued
hereunder, all premiums (if any) payable under paragraphs 16 and 17 of this
Bond, all Late Charges (if any) payable under paragraphs 11 and 18 of this Bond,
and all fees (if any) payable under paragraph 9 of this Bond have been paid in
full.

                 

                
                  
                    
                    

                  

                  
                    Bond
- page 18

                    
                      

                    

                  

                  
                    
                    

                  

                

                

                  22.    RUS Guarantee of
Bond.

                   

                

                Upon execution of the guarantee set
forth at the end of this Bond (the "RUS Guarantee"), the
payment by the Borrower of all amounts due and payable under this Bond, when and
as due, shall be guaranteed by the United States of America, acting through RUS,
pursuant to the Rural Electrification Act of 1936, as amended (codified at 7
U.S.C. § 901 et
seq.).  In
consideration of the RUS Guarantee, the Borrower promises to RUS to make all
payments due under this Bond when and as due. 

                 

                
                  23.    Pledge
Agreement.

                   

                

                This Bond is one of several Bonds
referred to in the Pledge Agreement, wherein the Borrower made provision for the
pledge and grant of a security interest in, under certain circumstances
described therein, certain property of the Borrower, described therein, to
secure the payment of and performance of certain obligations owed to RUS, as set
forth in the Pledge Agreement.

                


                24.    Guarantee Payments;
Reimbursement.

                


                If RUS makes any payment, pursuant to
the RUS Guarantee, of any amount due and payable under this Bond, when and as
due, each and every such payment so made shall be deemed to be a payment
hereunder; provided, however, that no
payment by RUS pursuant to the RUS Guarantee shall be considered a payment for
purposes of determining the existence of a failure by the Borrower to perform
its obligation to RUS to make all payments under this Bond when and as
due.  RUS shall have any rights by way of subrogation, agreement or
otherwise which arise as a result of such payment pursuant to the RUS
Guarantee.

                 

                
                  25.    Default and
Enforcement.

                

                 

                In case of a default by the Borrower
under this Bond or the occurrence of an event of default under the Bond
Guarantee Agreement, then, in consideration of the obligation of RUS under the
RUS Guarantee, in that event, to make payments to FFB as provided in this Bond,
RUS, in its own name, shall have all rights, powers, privileges, and remedies of
the holder of this Bond, in accordance with the terms of this Bond, the Bond
Guarantee Agreement, and the Pledge Agreement, including, without limitation,
the right to enforce or collect all or any part of the obligation of the
Borrower under this Bond or arising as a result of the RUS Guarantee, to file
proofs of claim or any other document in any bankruptcy, insolvency, or other
judicial proceeding, and to vote such proofs of claim.

                


                26.    Acceleration.

                


                The entire unpaid principal amount of
this Bond, and all interest thereon, may be declared, and upon such declaration
shall become, due and payable to RUS, under the circumstances 

                 

                
                  
                    
                    

                  

                  
                    Bond
- page 19

                    
                      

                    

                  

                  
                    
                    

                  

                

                described,
and in the manner and with the effect provided, in the Bond Guarantee
Agreement.

                


                


                IN WITNESS WHEREOF, the
Borrower has caused this Bond to be signed in its corporate name and its
corporate seal to be hereunder affixed and attested by its officers thereunto
duly authorized, all as of the day and year first above written.

                


                


                


                     NATIONAL RURAL UTILITIES


                             COOPERATIVE
FINANCE CORPORATION

                                    (the
"Borrower")

                
 

                BY:

                 

                


                Signature:   /s/ SHELDON C. PETERSEN

                


                


                Print Name:  Sheldon C.
Petersen

                


                


                Title:       Governor
and

                                        Chief
Executive Officer

                 

                


                ATTEST:

                
 

                


                Signature:   /s/ JOHN J. LIST

                (SEAL)

                


                Print Name:  John J.
List

                


                


                Title:       Assistant
Secretary-Treasurer

                



                
                  
                    
                      


                       

                    

                     


                  

                  
                    Bond
- page 20

                    
                      

                    

                  

                  
                     


                    RUS

                  

                



              


               

               

               

               

              ANNEX
1-A

              


              TO

              


              FUTURE
ADVANCE BOND

              


               

              


              


              FORM

              


              OF

              


              MATURITY
EXTENSION ELECTION NOTICE

               

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

            

            
              
                


                MATURITY
EXTENSION ELECTION NOTICE

                


                ****************************************************************

                


                PART
1 OF THIS FORM HAS BEEN COMPLETED BY RUS.  THE BORROWER SHOULD
COMPLETE PART 2 OF THIS FORM ONLY FOR THOSE
PARTICULAR ADVANCES IDENTIFIED IN PART 1 OF THIS FORM WITH RESPECT TO WHICH THE
BORROWER ELECTS TO HAVE THE MATURITY EXTENDED TO A NEW MATURITY DATE OTHER THAN THE
IMMEDIATELY FOLLOWING QUARTERLY PAYMENT DATE.

                


                DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE
BORROWER:  

                


                Chief

                Policy
Analysis and Loan Management Staff

                Telephone:  (202)
720-0424

                


                WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO FFB AT THE
FOLLOWING ADDRESS:

                


                Manager

                Federal Financing Bank

                Main Treasury Building

                1500 Pennsylvania Avenue,
NW

                Washington,
DC  20220

                


                Telephone:  (202)
622-2470

                Facsimile:   (202)
622-0707

                


                 DELIVER
A COPY OF THIS
FORM TO RUS AT
THE ADDRESS OF THE CONTACT OFFICE INDICATED BELOW:

                


                Chief

                Policy
Analysis and Loan Management Staff

                Rural
Utilities Service

                U.S.
Department of Agriculture

                Mail
Stop 1560

                1400
Independence Avenue, SW

                Washington,
DC  20250-1560

                


                Reference:  Section
313A Loan Guarantee

                


                Telephone:  (202)
720-0424

                Facsimile:   (202)
690-0717

                


                THE
BORROWER SHOULD NOT COMPLETE THIS
FORM OR DELIVER
IT TO FFB  IF THE BORROWER DESIRES TO HAVE THE MATURITY OF ALL OF THE
ADVANCES IDENTIFIED IN PART 1 OF THIS FORM EXTENDED AUTOMATICALLY TO THE
IMMEDIATELY FOLLOWING QUARTERLY PAYMENT DATE.

                


                IF
THE BORROWER DOES NOT RETURN THIS FORM
TO FFB, THE MATURITY OF ALL OF THE ADVANCES IDENTIFIED IN PART 1 OF THIS FORM
WILL BE EXTENDED AUTOMATICALLY TO THE IMMEDIATELY FOLLOWING QUARTERLY PAYMENT
DATE.

                 

                ****************************************************************

                
                  
                    
                    

                  

                  
                    MATURITY
EXT. ELECTION - page1

                    
                      

                    

                  

                  
                    
                    

                    RUS

                  

                

                 

                
                  MATURITY
EXTENSION ELECTION NOTICE

                  


                  Manager

                  Federal
Financing Bank

                  


                  Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                   

                  Name of
Borrower (the "Borrower"):

                  


                  National Rural Utilities
Cooperative Finance Corporation

                  


                  FFB Bond
Identifier: _____________________

                  


                  RUS Bond
Number: _____________________

                   

                  Part 1 (To be completed by
RUS):

                  


                  


                  Each of the advances of funds
("Advances") identified in this Part 1 will mature on _______________ (the
"Maturity Date").

                   

                       
  FFB             RUS         ORIGINAL     ORIGINAL     OUTSTANDING

                    ADVANCE        
ACCOUNT    ADVANCE      ADVANCE      
PRINCIPAL

                   IDENTIFIER      
 NUMBER        DATE           
AMOUNT         
AMOUNT

                  


                  


                   ___________    
_______    
 _________    $___________  $___________

                  


                   ___________    
_______      _________    $___________  $___________

                  


                   ___________    
_______      _________    $___________  $___________

                  


                   ___________    
_______      _________    $___________  $___________

                  


                  


                  
                    
                      
                      

                    

                    
                      MATURITY
EXT. ELECTION - 2

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  


                  Part 2:

                   

                  Notice is hereby given to FFB (and RUS)
of the Borrower's election that the maturity of each of the Advances identified
in this Part 2 be extended as follows:

                  


                  


                                                              AMOUNT
OF                          TYPE
OF

                      FFB            OPTIONAL             
  PRINCIPAL         NEW           
PREPAYMENT/    
 5-YEAR

                    ADVANCE         PRINCIPAL            TO
BE         MATURITY     REFINANCING       
 NO-CALL     PREMIUM

                   IDENTIFIER1      PAYMENT2          EXTENDED3       DATE4           PRIVILAGE         PERIOD6      OPTION7

                  


                  


                   __________      $________          _________       _________     _________       _________    _________

                  


                   __________      $________          _________       _________   
 _________          
_________    _________

                  


                   __________      $________          _________       _________        
_________          
_________    _________

                  


                   __________      $________          _________       _________        
_________         
 _________    _________                    

                  


                   

                  ____________________

                  
                    1Complete 1 line in Part 2 for each
Advance identified in Part 1 with respect to which the Borrower elects to have
the maturity extended to a new Maturity Date other
than the next Payment
Date.  Insert the FFB Advance Identifier that FFB assigned to the
respective Advance for each Advance identified in Part 1 with respect to which
the Borrower elects to have the maturity so extended. 

                  

                          2The
Borrower has the option of making a payment of principal on the Maturity Date
without any premium being charged.  For each Advance, insert the
amount of any such optional principal payment that will be paid on the Maturity
Date.

                                 
3For each
Advance, insert the amount of principal for which the maturity is to be
extended.  That amount must equal the difference between
the outstanding principal amount for the respective Advance, as specified in
Part 1, and the optional principal payment (if any) for such Advance inserted by
the Borrower in Part 2.

                          4For each
Advance, insert the particular calendar date that the Borrower selects to be the
new Maturity
Date" to be in effect for the respective Advance after the Maturity Extension,
which new Maturity Date must meet all the criteria for Maturity Dates specified
in section 7.3.1(a)(5) of the Bond Purchase Agreement referred to in the
Bond.

                       5Elect 1
of the following 2 types of prepayment/refinancing privilege for an Advance
only if the new
Maturity Date selected for such Advance will occur on or after the fifth
anniversary of the effective date of this Maturity Extension.  The 2
types of prepayment/refinancing privilege are: the market value premium (or
discount) privilege ("M") and a fixed premium privilege ("F").  Insert
in the box the letter-symbol for the particular type of prepayment/refinancing
privilege elected.

                          
6Elect 1
of the following 2 no-call period options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 2 no-call period options are: yes ("Y"), if the Borrower
elects to have the fixed premium prepayment/refinancing privilege include a
5-year period during which the Advance will not be eligible for prepayment or
refinancing, and no ("N"), if the Borrower elects to have the fixed premium
prepayment/refinancing privilege not include any such
a 5-year no-call period.  Insert in the box the letter-symbol for the
particular no-call period option elected. 

                  
                    7Select 1
of the following 3 premium options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 3 premium options are: a 10% premium declining over 10
years ("X"), a 5% premium declining over 5 years ("V"), and par (no premium)
("P").  Insert in the box the letter-symbol for the particular premium
option selected. 

                  

                  


                  
                    
                      
                      

                    

                    
                      MATURITY
EXT. ELECTION - 3

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                

                 

                The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Maturity Extension
Election Notice on behalf of the Borrower is valid and in full force and effect
on the date hereof.

                


                


                


                NATIONAL
RURAL UTILITIES COOPERATIVE 

                FINANCE
CORPORATION

                (the "Borrower")

                


                


                By:     _______________________

                


                Name:   _______________________

                


                Title: 
_______________________

                


                Date:   _______________________

                


                


                 

              

               

              
                
                  
                  

                

                
                  MATURITY
EXT. ELECTION - page4

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              
                 

                ANNEX
1-B

                


                TO

                


                FUTURE
ADVANCE BOND

                


                


                


                FORM

                


                OF

                


                MATURITY
EXTENSION ELECTION NOTICE

                


                (RUS
APPROVAL REQUIRED)

                


              

              MATURITY
EXTENSION ELECTION NOTICE

              (RUS
APPROVAL REQUIRED)

              


              ****************************************************************

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

              


              PART
1 OF THIS FORM HAS BEEN COMPLETED BY RUS.  THE BORROWER SHOULD
COMPLETE PART 2 OF THIS FORM ONLY FOR THOSE
PARTICULAR ADVANCES IDENTIFIED IN PART 1 OF THIS FORM WITH RESPECT TO WHICH THE
BORROWER ELECTS TO HAVE THE MATURITY EXTENDED TO A NEW MATURITY DATE OTHER THAN THE
IMMEDIATELY FOLLOWING QUARTERLY PAYMENT DATE.

              


              DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE BORROWER:


              


              Chief

              Policy
Analysis and Loan Management Staff

              Telephone:  (202)
720-0424

              


              WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO RUS AT THE ADDRESS
OF THE CONTACT OFFICE INDICATED BELOW:

              


              Chief

              Policy
Analysis and Loan Management Staff

              Rural
Utilities Service

              U.S.
Department of Agriculture

              Mail
Stop 1560

              1400
Independence Avenue, SW

              Washington,
DC  20250-1560

              


              Reference:  Section
313A Loan Guarantee

              


              Telephone:  (202)
720-0424

              Facsimile:   (202)
690-0717

              


              THE
BORROWER SHOULD NOT COMPLETE THIS
FORM OR DELIVER
IT TO RUS  IF THE BORROWER DESIRES TO HAVE THE MATURITY OF ALL OF THE
ADVANCES IDENTIFIED IN PART 1 OF THIS FORM EXTENDED AUTOMATICALLY TO THE
IMMEDIATELY FOLLOWING QUARTERLY PAYMENT DATE.

              


              IF
THE BORROWER DOES NOT RETURN THIS FORM
TO RUS, THE MATURITY OF ALL OF THE ADVANCES IDENTIFIED IN PART 1 OF THIS FORM
WILL BE EXTENDED AUTOMATICALLY TO THE IMMEDIATELY FOLLOWING QUARTERLY PAYMENT
DATE.


              ****************************************************************

               

              
                
                  
                  

                

                
                  MATURITY
EXT. ELECTION - 1

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              MATURITY
EXTENSION ELECTION NOTICE

              


              Manager

              Federal
Financing Bank

              


              Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

               

              Name of
Borrower (the "Borrower"):

              


              National Rural Utilities
Cooperative Finance Corporation

              


              FFB Bond
Identifier: _____________________

              


              RUS Bond
Number: _____________________

               

              Part 1 (To be completed by
RUS):

              


              


              Each of the advances of funds
("Advances") identified in this Part 1 will mature on _______________ (the
"Maturity Date").

               

                   
  FFB             RUS         ORIGINAL     ORIGINAL     OUTSTANDING

                ADVANCE        
ACCOUNT    ADVANCE      ADVANCE      
PRINCIPAL

               IDENTIFIER      
 NUMBER        DATE           
AMOUNT         
AMOUNT

              


              


               ___________    
_______    
 _________    $___________  $___________

              


               ___________    
_______      _________    $___________  $___________

              


               ___________    
_______      _________    $___________  $___________

              


               ___________    
_______      _________    $___________  $___________

              


              


              
                
                  
                  

                

                
                  MATURITY
EXT. ELECTION - 2

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              


              Part 2:

               

              Notice is hereby given to FFB (and RUS)
of the Borrower's election that the maturity of each of the Advances identified
in this Part 2 be extended as follows:

              


              


                                                          AMOUNT
OF                          TYPE
OF

                  FFB            OPTIONAL             
  PRINCIPAL         NEW           
PREPAYMENT/    
 5-YEAR

                ADVANCE         PRINCIPAL            TO
BE         MATURITY     REFINANCING       
 NO-CALL     PREMIUM

               IDENTIFIER1      PAYMENT2          EXTENDED3       DATE4           PRIVILAGE         PERIOD6      OPTION7

              


              


               __________      $________          _________       _________     _________       _________    _________

              


               __________      $________          _________       _________   
 _________          
_________    _________

              


               __________      $________          _________       _________        
_________          
_________    _________

              


               __________      $________          _________       _________        
_________         
 _________    _________                    

              


               

              ____________________

              
                1Complete 1 line in Part 2 for each
Advance identified in Part 1 with respect to which the Borrower elects to have
the maturity extended to a new Maturity Date other
than the next Payment
Date.  Insert the FFB Advance Identifier that FFB assigned to the
respective Advance for each Advance identified in Part 1 with respect to which
the Borrower elects to have the maturity so extended. 

              

                      2The
Borrower has the option of making a payment of principal on the Maturity Date
without any premium being charged.  For each Advance, insert the
amount of any such optional principal payment that will be paid on the Maturity
Date.

                             
3For each
Advance, insert the amount of principal for which the maturity is to be
extended.  That amount must equal the difference between
the outstanding principal amount for the respective Advance, as specified in
Part 1, and the optional principal payment (if any) for such Advance inserted by
the Borrower in Part 2.

                      4For each
Advance, insert the particular calendar date that the Borrower selects to be the
new Maturity
Date" to be in effect for the respective Advance after the Maturity Extension,
which new Maturity Date must meet all the criteria for Maturity Dates specified
in section 7.3.1(a)(5) of the Bond Purchase Agreement referred to in the
Bond.

                   5Elect 1
of the following 2 types of prepayment/refinancing privilege for an Advance
only if the new
Maturity Date selected for such Advance will occur on or after the fifth
anniversary of the effective date of this Maturity Extension.  The 2
types of prepayment/refinancing privilege are: the market value premium (or
discount) privilege ("M") and a fixed premium privilege ("F").  Insert
in the box the letter-symbol for the particular type of prepayment/refinancing
privilege elected.

                      
6Elect 1
of the following 2 no-call period options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 2 no-call period options are: yes ("Y"), if the Borrower
elects to have the fixed premium prepayment/refinancing privilege include a
5-year period during which the Advance will not be eligible for prepayment or
refinancing, and no ("N"), if the Borrower elects to have the fixed premium
prepayment/refinancing privilege not include any such
a 5-year no-call period.  Insert in the box the letter-symbol for the
particular no-call period option elected. 

              
                7Select 1
of the following 3 premium options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 3 premium options are: a 10% premium declining over 10
years ("X"), a 5% premium declining over 5 years ("V"), and par (no premium)
("P").  Insert in the box the letter-symbol for the particular premium
option selected. 

              

              


              
                
                  
                  

                

                
                  MATURITY
EXT. ELECTION - 3

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Maturity Extension
Election Notice on behalf of the Borrower is valid and in full force and effect
on the date hereof.

              


              


              NATIONAL
RURAL UTILITIES COOPERATIVE 

              FINANCE
CORPORATION

              (the "Borrower")

              


              


              By:     _______________________

              


              Name:   _______________________

              


              Title: 
_______________________

              


              Date:   _______________________

              


              
                
                  
                  

                

                
                  MATURITY
EXT. ELECTION - 4

                  
                    

                  

                

                
                  
                  

                  RUS

                

              

              
                 


                
                  


                  


                   

                  


                  


                  


                  


                  ANNEX
2-A

                  


                  TO

                  


                  FUTURE
ADVANCE BOND

                  


                   

                  


                  FORM

                  


                  OF

                  


                  PREPAYMENT
ELECTION NOTICE

                  


                  SPECIFIED
PRINCIPAL AMOUNT(S)

                  


                  (RUS
APPROVAL REQUIRED)

                   

                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                   

                  
                    PREPAYMENT
ELECTION NOTICE

                    SPECIFIED
PRINCIPAL AMOUNT(S)

                    (RUS
APPROVAL REQUIRED)

                     

                    ****************************************************************

                    


                    DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE BORROWER:


                    


                    Chief

                    Policy
Analysis and Loan Management Staff

                    Telephone:  (202)
720-0424

                    


                    WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO RUS AT THE ADDRESS
OF THE CONTACT OFFICE INDICATED BELOW:

                    


                    Chief

                    Policy
Analysis and Loan Management Staff

                    Rural
Utilities Service

                    U.S.
Department of Agriculture

                    Mail
Stop 1560

                    1400
Independence Avenue, SW

                    Washington,
DC  20250-1560

                    


                    Reference:  Section
313A Loan Guarantee

                    


                    Telephone:  (202)
720-0424

                    Facsimile:   (202)
690-0717

                    ****************************************************************

                     

                    PREPAYMENT
ELECTION NOTICE

                    SPECIFIED
PRINCIPAL AMOUNT(S)

                    Manager

                    Federal
Financing Bank

                    


                    Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                     

                    Name of
Borrower (the "Borrower"):

                    


                    National Rural Utilities
Cooperative Finance Corporation

                     

                    FFB Bond
Identifier:_____________________1

                    ______________________

                    
                      1Insert
the FFB Bond Identifier that FFB assigned to the Bond (as provided in the Bond
Purchase Agreement referred to in the Bond).

                      
                        
                          
                          

                        

                        
                          PREPAYMENT
ELECTION - page 1

                          
                            

                          

                        

                        
                          
                          

                          RUS

                        

                      

                    

                    Part 1:

                     

                    Notice is hereby given to FFB (and RUS)
of the Borrower's election to prepay all or a portion of the outstanding
principal amount of the advances of funds ("Advances") identified in this Part
1:

                     

                    
                             
FFB             RUS         ORIGINAL     ORIGINAL     OUTSTANDING

                        ADVANCE        
ACCOUNT    ADVANCE      ADVANCE      
PRINCIPAL

                       IDENTIFIER      
 NUMBER        DATE           
AMOUNT         
AMOUNT

                      


                      


                       ___________    
_______    
 _________    $___________  $___________

                      


                       ___________    
_______      _________    $___________  $___________

                      


                       ___________    
_______      _________    $___________  $___________

                      


                       ___________    
_______      _________    $___________  $___________



                     

                    Part 2:

                     

                    The Borrower intends to prepay all or a
portion of the outstanding principal amount of each of the Advances identified
in Part 1 on the following date (such date being the "Intended Prepayment
Date"):

                    


                    


                    ____________________________________7

                    


                    __________________________

                    
                      2Complete
1 line in Part 1 for each Advance that the Borrower intends to prepay in whole
or in part.  For each Advance, insert the FFB Advance Identifier for
the respective Advance as specified in the most recent billing notice delivered
by RUS to the Borrower.

                    

                    
                      3For each
Advance, insert the RUS Account Number for the respective Advance as specified
in the most recent billing notice delivered by RUS to the Borrower.

                    

                    
                      4For each
Advance, insert the date on which FFB made the respective Advance to the
Borrower.

                    

                    
                      5For each
Advance, insert the original principal amount of the respective Advance that FFB
made to the Borrower.

                    

                    
                      6Insert
the outstanding principal amount of each Advance specified in Part 1 as of the
day before the
date on which the Borrower intends to make a prepayment on the respective
Advances.

                    

                    
                      7Insert
the particular calendar date that the Borrower selects to be the date on which
the Borrower intends to prepay the Advances specified in Part 1, which date must
meet the criteria for Intended Prepayment Date prescribed in paragraph 16(b)(1)
of the Bond.

                    

                    


                    
                      
                        
                        

                      

                      
                        PREPAYMENT
ELECTION - page 2

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                    Part 3:

                     

                    For each of the Advances identified in
Part 1, the respective amount of principal that the Borrower intends to prepay
on the Intended Prepayment Date is as follows:

                    


                                 FFB                          AMOUNT OF

                           ADVANCE                    PRINCIPAL
TO

                         IDENTIFIER8                    BE PREPAID9     

                    


                    


                         __________                   $____________

                    


                         __________                   $____________

                    


                         __________                   $____________

                    


                     

                    The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Prepayment Election
Notice on behalf of the Borrower is valid and in full force and effect on the
date hereof.

                     

                     

                    NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION

                    (the "Borrower")

                    


                    


                    By:     _______________________

                    


                    Name:   _______________________

                    


                    Title: 
_______________________

                    


                    Date:   _______________________

                     

                    _____________________________

                    
                      8Complete
1 line in Part 3 for each Advance identified in Part 1.

                      9For each
Advance, insert the amount of principal that will be prepaid on the Intended
Prepayment Date.

                    

                     

                    
                      
                        
                        

                      

                      
                        PREPAYMENT
ELECTION - page 3

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                    


                    NOTICE
OF RUS APPROVAL OF

                    PREPAYMENT
ELECTION NOTICE

                    


                     

                    Notice is hereby given to FFB that the
preceding Prepayment Election Notice made by the Borrower identified therein has
been approved by RUS for purposes of the Bond identified therein.

                    


                    


                    
                      	
                               
      

                            	
                              ADMINISTRATOR
      of the

                            


                    

                    RURAL
UTILITIES SERVICE,

                    acting
through his or her

                    duly
authorized designee

                    


                     

                    
 

                    By:     _______________________

                    


                    Name:   _______________________

                    


                    Title: 
_______________________

                    


                    Date:   _______________________

                     

                    
                      
                        
                        

                      

                      
                        PREPAYMENT
ELECTION - page 4

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  


                   

                   

                   

                   

                   

                   

                   

                  ANNEX
2-B

                  


                  TO

                  


                  FUTURE
ADVANCE BOND

                  


                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  PREPAYMENT
ELECTION NOTICE

                  


                  FIXED
SUM TO BE APPLIED

                  


                  (RUS
APPROVAL REQUIRED)

                  


                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  


                  PREPAYMENT
ELECTION NOTICE

                  FIXED
SUM TO BE APPLIED

                  (RUS
APPROVAL REQUIRED)

                  


                  ****************************************************************

                  


                  DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE BORROWER:


                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Telephone:  (202)
720-0424

                  


                  WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO RUS AT THE ADDRESS
OF THE CONTACT OFFICE INDICATED BELOW:

                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Rural
Utilities Service

                  U.S.
Department of Agriculture

                  Mail
Stop 1560

                  1400
Independence Avenue, SW

                  Washington,
DC  20250-1560

                  


                  Reference:  Section
313A Loan Guarantee

                  


                  Telephone:  (202)
720-0424

                  Facsimile:   (202)
690-0717

                   

                  ****************************************************************

                  


                  PREPAYMENT
ELECTION NOTICE

                  FIXED
SUM TO BE APPLIED

                  Manager

                  Federal
Financing Bank

                  


                  Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                   

                  Name of
Borrower (the "Borrower"):

                  


                  National Rural Utilities
Cooperative Finance Corporation

                   

                  FFB Bond
Identifier:_____________________1

                  _______________________

                  
                    1Insert
the FFB Bond Identifier that FFB assigned to the Bond (as provided in the Bond
Purchase Agreement referred to in the Bond).

                    
                      
                        
                        

                      

                      
                        FX SUM -
page 1

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  Part 1:

                  


                  


                  Notice is hereby given to FFB (and RUS)
of the Borrower's election to prepay all or a portion of the outstanding
principal amount of the advances of funds ("Advances") identified in this Part
1:

                   

                    FFB             RUS         ORIGINAL     
ORIGINAL     OUTSTANDING

                      ADVANCE        
ACCOUNT    ADVANCE      ADVANCE      
PRINCIPAL

                     IDENTIFIER2      NUMBER3      
 DATE4          
AMOUNT5         AMOUNT6   

                  

                  


                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  


                  Part 2:

                   

                  The Borrower intends to prepay all or a
portion of the outstanding principal amount of the Advances identified in
Part 1 on the following date (such date being the "Intended Prepayment
Date"):

                   

                  ____________________________________7

                  


                  
____________________________

                  
                    2Complete
1 line in Part 1 for each Advance that the Borrower intends to prepay in whole
or in part.  For each Advance, insert the FFB Advance Identifier for
the respective Advance as specified in the most recent billing notice delivered
by RUS to the Borrower.

                  

                  
                    3For each
Advance, insert the RUS Account Number for the respective Advance as specified
in the most recent billing notice delivered by RUS to the Borrower.

                  

                  
                    4For each
Advance, insert the date on which FFB made the respective Advance to the
Borrower.

                  

                  
                    5For each
Advance, insert the original principal amount of the respective Advance that FFB
made to the Borrower.

                  

                  
                    6Insert
the outstanding principal amount of each Advance specified in Part 1 as of the
day before the
date on which the Borrower intends to make a prepayment on the respective
Advances.

                  

                  
                    7Insert
the particular calendar date that the Borrower selects to be the date on which
the Borrower intends to prepay the Advances specified in Part 1, which date must
meet the criteria for Intended Prepayment Date prescribed in paragraph 16(b)(1)
of the Bond. 

                  

                   

                  
                    
                      
                      

                    

                    
                      FX SUM -
page 2

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  Part 3:

                   

                  The Borrower elects to have the
following amount of funds applied by FFB toward a prepayment of the outstanding
principal amount of the Advances identified in Part 1, in the order in which
they appear in Part 1:

                   

                  ____________________________________8

                   

                  The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Prepayment Election
Notice on behalf of the Borrower is valid and in full force and effect on the
date hereof.

                  


                   

                  NATIONAL
RURAL UTILITIES COOPERATIVE 

                  FINANCE
CORPORATION

                  (the "Borrower")

                  


                   

                  By:     _______________________

                  


                  Name:   _______________________

                  


                  Title: 
_______________________

                  


                  Date:   _______________________

                  
                    ______________________________

                    
                      8Insert
the particular amount of funds that the Borrower elects to be applied by FFB
toward a prepayment of the outstanding principal amount of the Advances
identified in Part 1, in the order in which they appear in Part 1.


                    

                  

                   

                  
                    
                      
                      

                    

                    
                      FX SUM -
page 3

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  NOTICE
OF RUS APPROVAL OF

                  PREPAYMENT
ELECTION NOTICE

                   

                  Notice is hereby given to FFB that the
preceding Prepayment Election Notice made by the Borrower identified therein has
been approved by RUS for purposes of the Bond identified therein.

                  


                  


                  
                    	
                             
      

                          	
                            ADMINISTRATOR
      of the

                          


                  

                  RURAL
UTILITIES SERVICE,

                  acting
through his or her

                  duly
authorized designee

                  


                   

                  By:     _______________________

                  


                  Name:   _______________________

                  


                  Title: 
_______________________

                  


                  Date:   _______________________

                  


                

                
                  
                    
                    

                  

                  
                    FX SUM -
page 4

                    
                      

                    

                  

                  
                    
                    

                    RUS

                  

                

                
                  


                  


                  


                  


                  


                  


                  ANNEX
3-A

                  


                  TO

                  


                  FUTURE
ADVANCE BOND

                  


                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  REFINANCING
ELECTION NOTICE

                  


                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  


                  REFINANCING
ELECTION NOTICE

                  


                  ****************************************************************

                  


                  DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE
BORROWER:  

                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Telephone:  (202)
720-0424

                  


                  WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO FFB AT THE
FOLLOWING ADDRESS:

                  


                  Manager

                  Federal Financing Bank

                  Main Treasury Building

                  1500 Pennsylvania Avenue,
NW

                  Washington,
DC  20220

                  


                  Telephone:  (202)
622-2470

                  Facsimile:   (202)
622-0707

                  


                   DELIVER
A COPY OF THIS
FORM TO RUS AT
THE ADDRESS OF THE CONTACT OFFICE INDICATED BELOW:

                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Rural
Utilities Service

                  U.S.
Department of Agriculture

                  Mail
Stop 1560

                  1400
Independence Avenue, SW

                  Washington,
DC  20250-1560

                  


                  Reference:  Section
313A Loan Guarantee

                  


                  Telephone:  (202)
720-0424

                  Facsimile:   (202)
690-0717

                   

                  ******************************************************************************

                  


                  REFINANCING ELECTION
NOTICE

                  Manager

                  Federal
Financing Bank

                  


                  


                  Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                  


                  


                  Name of
Borrower (the "Borrower"):

                  


                  National Rural Utilities
Cooperative Corporation

                  


                  
                    
                      
                      

                    

                    
                      REFIN.
ELECTN NOTICE - page 1

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  FFB Bond
Identifier: ______________________1

                   

                  Part 1:

                   

                  Notice is hereby given to FFB (and RUS)
of the Borrower's election to refinance the outstanding principal amount of each
of the advances of funds ("Advances") identified in this Part 1:

                  


                     FFB             RUS           
ORIGINAL     
ORIGINAL      OUTSTANDING

                   ADVANCE      ACCOUNT    ADVANCE      ADVANCE        PRINCIPAL

                  IDENTIFIER2    NUMBER3     DATE4            
AMOUNT5         AMOUNT6

                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  


                  Part 2:

                   

                  The Borrower intends to refinance the
outstanding principal amount of each of the Advances identified in Part 1 on the
following date (such date being the "Intended Refinancing Date"):

                   

                  


                  ____________________________________7

                  ___________________

                  
                    1Insert
the FFB Bond Identifier that FFB assigned to the Bond (as provided in the Bond
Purchase Agreement referred to in the Bond).

                    
                      2Complete
1 line in Part 1 for each Advance that the Borrower intends to
refinance.  For each Advance, insert the FFB Advance Identifier for
the respective Advance as specified in the most recent billing notice delivered
by RUS to the Borrower.

                    

                    
                      3For each
Advance, insert the RUS Account Number for the respective Advance as specified
in the most recent billing notice delivered by RUS to the Borrower.

                    

                    
                      4For each
Advance, insert the date on which FFB made the respective Advance to the
Borrower.

                    

                    
                      5For each
Advance, insert the original principal amount of the respective Advance that FFB
made to the Borrower.

                    

                    
                      6For each
Advance, insert the outstanding principal amount of the respective Advance as of
the day before
the intended refinancing.

                    

                    
                      7Insert
the particular calendar date that the Borrower selects to be the date on which
the Borrower intends to refinance the Advances specified in Part 1, which date
must meet the criteria for Intended Refinancing Date prescribed in paragraph
17(b)(1) of the Bond.  

                    

                     

                    
                      
                        
                        

                      

                      
                        REFIN.
ELECTN NOTICE - page 2

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  


                  Part 3:

                  


                  


                  Notice is hereby given to FFB (and RUS)
of the Borrower's election that each of the Advances identified in Part 1 is to
be refinanced as follows:

                  
 

                                               AMOUNT
OF                           TYPE OF

                         FFB                  PRINCIPAL          NEW          PREPAYMENT/        5-YEAR

                       ADVANCE              TO
BE            MATURITY      REFINANCING        NO-CALL     PREMIUM

                      IDENTIFIER8     REFINANCED9      DATE10         PRIVILEGE11                  PERIOD12     OPTION13

                  


                  


                      __________        $___________      _________     _________         _________     
_________

                  


                      __________        $___________         
_________     _________         _________  
   _________              

                  


                      __________        $___________         
_________     _________         _________     
_________

                  
 

                      __________        $___________          _________    
_________         _________   _________

                  


                  ________________________

                  
                    8Complete
1 line in Part 3 for each Advance identified in Part 1 as being an Advance the
Borrower elects to refinance.  Insert the FFB Advance Identifier that
FFB assigned to the respective Advance. 

                  

                  
                    9For each
Advance, insert the amount of principal that is to be
refinanced.  This will be the same amount as the outstanding principal
amount of the respective Advance inserted in Part 1. 

                  

                  
                    10For each
Advance, insert the particular calendar date that the Borrower selects to be the
new Maturity
Date to be in effect for the respective Advance after the refinancing, which new
Maturity Date must meet all the criteria for Maturity Dates specified in section
7.3.1(a)(5) of the Bond Purchase Agreement referred to in the Bond.

                  

                  
                    11Elect 1
of the following 2 types of prepayment/refinancing privilege for an Advance
only if the new
Maturity Date selected for such Advance will occur on or after the fifth
anniversary of the effective date of this Maturity Extension.  The 2
types of prepayment/refinancing privilege are: the market value premium (or
discount) privilege ("M") and a fixed premium privilege ("F").  Insert
in the box the letter-symbol for the particular type of prepayment/refinancing
privilege elected.

                  

                  
                    12Elect 1
of the following 2 no-call period options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 2 no-call period options are: yes ("Y"), if the Borrower
elects to have the fixed premium prepayment/refinancing privilege include a
5-year period during which the Advance will not be eligible for prepayment or
refinancing, and no ("N"), if the Borrower elects to have the fixed premium
prepayment/refinancing privilege not include any such
a 5-year no-call period.  Insert in the box the letter-symbol for the
particular no-call period option elected. 

                  

                  
                    13Select 1
of the following 3 premium options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 3 premium options are: a 10% premium declining over 10
years ("X"), a 5% premium declining over 5 years ("V"), and par (no premium)
("P").  Insert in the box the letter-symbol for the particular premium
option selected. 

                  

                  


                  
                    
                      
                      

                    

                    
                      REFIN.
ELECTN NOTICE - page 3

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Refinancing
Election Notice on behalf of the Borrower is valid and in full force and effect
on the date hereof.

                  


                  


                  


                  NATIONAL
RURAL UTILITIES COOPERATIVE 

                  FINANCE
CORPORATION

                  (the "Borrower")

                  


                  


                  By:     _______________________

                  


                  Name:   _______________________

                  


                  Title: 
_______________________

                  


                  Date:   _______________________

                  


                  


                  
                    
                      
                      

                    

                    
                      REFIN.
ELECTN NOTICE - page 4

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  
                    


                    


                     

                    


                    


                    


                    ANNEX
3-B

                    


                    TO

                    


                    FUTURE
ADVANCE BOND

                    


                    


                     

                    


                    FORM

                    


                    OF

                    


                    REFINANCING
ELECTION NOTICE

                    


                    (RUS
APPROVAL REQUIRED)

                    


                    
                      
                        
                        

                      

                      
                        
                        

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  REFINANCING
ELECTION NOTICE

                  (RUS
APPROVAL REQUIRED)

                  


                  


                  ****************************************************************

                  


                  DIRECT
ALL QUESTIONS
ON HOW TO COMPLETE THIS FORM TO THE ASSIGNED CONTACT OFFICE FOR THE BORROWER:


                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Telephone:  (202)
720-0424

                  


                  WHEN
COMPLETED, DELIVER THIS ORIGINAL FORM TO RUS AT THE ADDRESS
OF THE CONTACT OFFICE INDICATED BELOW:

                  


                  Chief

                  Policy
Analysis and Loan Management Staff

                  Rural
Utilities Service

                  U.S.
Department of Agriculture

                  Mail
Stop 1560

                  1400
Independence Avenue, SW

                  Washington,
DC  20250-1560

                  


                  Reference:  Section
313A Loan Guarantee

                  


                  Telephone:  (202)
720-0424

                  Facsimile:   (202)
690-0717

                  ******************************************************************************

                  


                  REFINANCING ELECTION
NOTICE

                  Manager

                  Federal
Financing Bank

                   

                  Reference is made to the
following-described Future Advance Bond (the "Bond") payable to the Federal
Financing Bank ("FFB"), which is guaranteed by the Rural Utilities Service
("RUS"):

                   

                  Name of
Borrower (the "Borrower"):

                  


                  National Rural Utilities
Cooperative Corporation

                   

                  FFB Bond
Identifier: ______________________1

                  __________________

                  
                    1Insert the FFB Bond Identifier that FFB
assigned to the Bond (as provided in the Bond Purchase Agreement referred to in
the Bond).

                    
                      
                        
                        

                      

                      
                        REFIN.
ELECTION NOTICE - page 1

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  Part 1:

                   

                  Notice is hereby given to FFB (and RUS)
of the Borrower's election to refinance the outstanding principal amount of each
of the advances of funds ("Advances") identified in this Part 1:

                  


                  


                     FFB             RUS       
    ORIGINAL     ORIGINAL      OUTSTANDING

                   ADVANCE      ACCOUNT    ADVANCE      ADVANCE        PRINCIPAL

                  IDENTIFIER2    NUMBER3       DATE4            AMOUNT5         AMOUNT6

                  


                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  ___________   _______   _________   $___________   $___________

                  


                  


                  Part 2:

                   

                  The Borrower intends to refinance the
outstanding principal amount of each of the Advances identified in Part 1 on the
following date (such date being the "Intended Refinancing Date"):

                  


                  


                  ____________________________________7

                   

                  ___________________

                  
                    2Complete
1 line in Part 1 for each Advance that the Borrower intends to
refinance.  For each Advance, insert the FFB Advance Identifier for
the respective Advance as specified in the most recent billing notice delivered
by RUS to the Borrower.

                  

                  
                    3For each
Advance, insert the RUS Account Number for the respective Advance as specified
in the most recent billing notice delivered by RUS to the Borrower.

                  

                  
                    4For each
Advance, insert the date on which FFB made the respective Advance to the
Borrower.

                  

                  
                    5For each
Advance, insert the original principal amount of the respective Advance that FFB
made to the Borrower.

                  

                  
                    6For each
Advance, insert the outstanding principal amount of the respective Advance as of
the day before
the intended refinancing.

                  

                  
                    7Insert the particular calendar date
that the Borrower selects to be the date on which the Borrower intends to
refinance the Advances specified in Part 1, which date must meet the criteria
for Intended Refinancing Date prescribed in paragraph 17(b)(1) of the
Bond.  

                     

                    
                      
                        
                        

                      

                      
                        REFIN.
ELECTION NOTICE - page 2

                        
                          

                        

                      

                      
                        
                        

                        RUS

                      

                    

                  

                  Part 3:

                   

                  Notice is hereby given to FFB (and RUS)
of the Borrower's election that each of the Advances identified in Part 1 is to
be refinanced as follows:

                  


                   

                                           AMOUNT
OF                             TYPE OF

                         FFB              PRINCIPAL             
NEW           PREPAYMENT/      5-YEAR

                       ADVANCE          TO
BE             MATURITY       REFINANCING     NO-CALL      PREMIUM

                      IDENTIFIER8   REFINANCED9       DATE10         PRIVILEGE11               
 PERIOD12     OPTION13

                  


                  


                      __________    $___________        _________       ___________    ___________    _________

                  


                      __________    $___________        _________       ___________    ___________    _________

                  


                      __________    $___________        _________       ___________    ___________    _________

                  


                      __________    $___________        _________       ___________    ___________    _________

                  


                  ___________________

                  
                    8Complete 1 line in Part 3 for each
Advance identified in Part 1 as being an Advance the Borrower elects to
refinance.  Insert the FFB Advance Identifier that FFB assigned to the
respective Advance. 

                  

                  
                    9For each
Advance, insert the amount of principal that is to be
refinanced.  This will be the same amount as the outstanding principal
amount of the respective Advance inserted in Part 1. 

                  

                  
                    10For each
Advance, insert the particular calendar date that the Borrower selects to be the
new Maturity
Date" to be in effect for the respective Advance after the refinancing, which
new Maturity Date must meet all the criteria for Maturity Dates specified in
section 7.3.1(a)(5) of the Bond Purchase Agreement referred to in the
Bond.

                  

                  
                    11Elect 1
of the following 2 types of prepayment/refinancing privilege for an Advance
only if the new
Maturity Date selected for such Advance will occur on or after the fifth
anniversary of the effective date of this Maturity Extension.  The 2
types of prepayment/refinancing privilege are: the market value premium (or
discount) privilege ("M") and a fixed premium privilege ("F").  Insert
in the box the letter-symbol for the particular type of prepayment/refinancing
privilege elected.

                  

                  
                    12Elect 1
of the following 2 no-call period options for an Advance only if a fixed
premium privilege is elected as the prepayment/refinancing privilege for such
Advance.  The 2 no-call period options are: yes ("Y"), if the Borrower
elects to have the fixed premium prepayment/refinancing privilege include a
5-year period during which the Advance will not be eligible for prepayment or
refinancing, and no ("N"), if the Borrower elects to have the fixed premium
prepayment/refinancing privilege not include any such
a 5-year no-call period.  Insert in the box the letter-symbol for the
particular no-call period option elected. 

                  

                  
                    13Select 1 of the following 3 premium
options for an Advance only if a fixed premium privilege is
elected as the prepayment/refinancing privilege for such Advance.  The
3 premium options are: a 10% premium declining over 10 years ("X"), a 5% premium
declining over 5 years ("V"), and par (no premium) ("P").  Insert in
the box the letter-symbol for the particular premium option selected.


                  

                  


                  
                    
                      
                      

                    

                    
                      REFIN.
ELECTION NOTICE - page 3

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  The undersigned hereby certifies that
the authority of the undersigned to execute and deliver this Refinancing
Election Notice on behalf of the Borrower is valid and in full force and effect
on the date hereof.

                  


                  


                  NATIONAL
RURAL UTILITIES COOPERATIVE 

                  FINANCE
CORPORATION

                  (the "Borrower")

                  


                  


                  By:     _______________________

                  


                  Name:   _______________________

                  


                  Title: 
_______________________

                  


                  Date:   _______________________

                  NOTICE
OF RUS APPROVAL OF 

                  REFINANCING
ELECTION NOTICE

                  


                  


                  Notice is hereby given to FFB that the
preceding Refinancing Election Notice made by the Borrower identified therein
has been approved by RUS for purposes of the Bond identified
therein.

                  


                  


                  
                    	
                             
      

                          	
                            ADMINISTRATOR
      of the

                          


                  

                  RURAL
UTILITIES SERVICE,

                  acting
through his or her

                  duly
authorized designee

                  
 

                  By:     _______________________

                  


                  Name:   _______________________

                  


                  Title: 
_______________________

                  


                  Date:   _______________________

                  


                  
                    
                      
                      

                    

                    
                      REFIN.
ELECTION NOTICE - page 4

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

 

                  EXHIBIT
C

                  


                  TO

                  


                  BOND
PURCHASE AGREEMENT

                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  CERTIFICATE
SPECIFYING AUTHORIZED BORROWER OFFICIALS

                  


                  


                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                

                 

                
                  CERTIFICATE
SPECIFYING

                  AUTHORIZED
BORROWER OFFICIALS


                  Federal
Financing Bank

                  Main
Treasury Building

                  1500
Pennsylvania Avenue, NW

                  Washington,
DC  20220

                  


                  


                  Reference is made to the Series C Bond
Purchase Agreement dated as of September 19, 2008 (the "Bond Purchase
Agreement"), by and among the Federal Financing Bank ("FFB"), National Rural
Utilities Cooperative Finance Corporation (the "Borrower"), and the
Administrator of the Rural Utilities Service ("RUS").  Capitalized
terms used herein and not defined herein shall have the respective meanings
ascribed to them in the Bond Purchase Agreement.

                  


                  This Certificate Specifying Authorized
Borrower Officials is delivered to FFB pursuant to section 4.1(c) of the Bond
Purchase Agreement.

                  


                  The undersigned, on behalf of the
Borrower, hereby certifies that:

                  


                  a.each of the individuals named below
is the duly qualified and incumbent official of the Borrower holding the
position title set out opposite the respective individual’s name;

                  


                  b.each of the individuals named below
is authorized to execute and deliver Advance Requests from time to time on
behalf of the Borrower; and

                  


                  c.the signature of each such individual
set out opposite the respective individual's name and title is the genuine
signature of such individual:

                  


                         Name               Title                 Signature

                  


                  


                   Sheldon
C. Petersen    Governor
and

                   Chief Executive
Officer         ____________________

                  


                   Steven
L. Lilly        Senior Vice President
and

                                    Chief Financial
Officer          ____________________

                  


                   John
J. ListSenior       Vice President, Assistant


                                      Secretary-Treasurer


                              and
General
Counsel             ____________________

                  
                    
                      
                      

                    

                    
                      page
1

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                   

                  The undersigned certifies that the
undersigned has been given the authority to execute this Certificate Specifying
Authorized Borrower Officials on behalf of the Borrower and to deliver it to
FFB, and that this authority is valid and in full force and effect on the date
hereof.

                  


                  IN WITNESS WHEREOF, the undersigned has
executed this Certificate Specifying Authorized Borrower Officials and caused it
to be delivered to FFB.

                  


                  


                  


                  NATIONAL
RURAL UTILITIES COOPERATIVE 

                  FINANCE
CORPORATION

                  (the "Borrower")

                  


                  


                  By:     _______________________

                  


                  Name:   John
J. List

                  


                  Title: 
Assistant Secretary-Treasurer

                  


                  Date:   September
19, 2008

                

                
                  
                    
                    

                  

                  
                    page
2

                    
                      

                    

                  

                  
                    
                    

                    RUS

                  

                

                
                   

                  
 

                  


                  EXHIBIT
D

                  


                  TO

                  


                  BOND
PURCHASE AGREEMENT

                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  CERTIFICATE
SPECIFYING AUTHORIZED RUS OFFICIALS

                   

                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                

                
                  


                  CERTIFICATE
SPECIFYING

                  AUTHORIZED
RUS OFFICIALS

                  


                  Federal
Financing Bank

                  Main
Treasury Building

                  1500
Pennsylvania Avenue, NW

                  Washington,
DC  20220

                   

                  Reference is made to the Series C Bond
Purchase Agreement dated as of September 19, 2008 (the "Bond Purchase
Agreement"), by and among the Federal Financing Bank ("FFB"), National Rural
Utilities Cooperative Finance Corporation (the "Borrower"), and the
Administrator of the Rural Utilities Service ("RUS").  Capitalized
terms used herein and not defined herein shall have the respective meanings
ascribed to them in the Bond Purchase Agreement.

                  


                  This Certificate Specifying Authorized
RUS Officials is delivered to FFB pursuant to section 4.2 or 13.1 of the Bond
Purchase Agreement.

                  


                  1.The
undersigned, on behalf of RUS, hereby certifies that:

                  


                  a.each of the individuals named below
is the duly qualified and incumbent official of RUS holding the position title
set out opposite the respective individual's name;

                  


                  b.each of the individuals named below
is authorized to execute and deliver Advance Request Approval Notices from time
to time on behalf of RUS; and

                  


                  c.the signature of each such individual
set out opposite the respective individual's name and title is the genuine
signature of such individual:

                   

                       Name          Title                     Signature

                  


                  


                   James R. Newby    Assistant
Administrator--

                  Electric
Program           
     _____________________

                  


                   Doris
A. Nolte       Chief 

                                    Policy
Analysis and

                                           
Loan Management
Staff          _____________________

                  


                   William
E. Railey    Chief

                            Financial
Operations Branch

                                    Power
Supply Division          
  ___________________

                  


                  
                    
                      
                      

                    

                    
                      page
1

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  


                  2.The
undersigned, on behalf of RUS, hereby certifies that:

                  


                  a.each of the individuals named below
is the duly qualified and incumbent official of RUS holding the position title
set out opposite the respective individual’s name;

                  


                  b.each of the individuals named below
is authorized to confirm telephonically the authenticity of Advance Request
Approval Notices from time to time on behalf of RUS; and

                  


                  c.the telephone number of each such
individual is set out opposite the respective individual's name and
title:

                  


                  


                    Name           Title             Telephone
Number

                  


                  


                     James
R. Newby    Assistant
Administrator--          (202)
720-9545

                             
        Electric
Program

                  


                     Doris
A. Nolte       
Chief                     
                (202)
720-0424

                                                              
Policy Analysis and

                                              
Loan Management Staff

                  


                     William
E. Railey    Chief                                   (202)
720-1968

                                              
Financial Operations Branch

                                              
Power Supply Division

                  
                    
                      
                      

                    

                    
                      page
2

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                   

                  IN WITNESS WHEREOF, the undersigned has
executed this Certificate Specifying Authorized RUS Officials and caused it to
be delivered to FFB.

                  


                  


                  


                  
                    	
                             
      

                          	
                            ADMINISTRATOR
      of the

                          


                  

                  RURAL
UTILITIES SERVICE,

                  


                  


                  


                  


                  By:     _______________________

                  


                  Name:   James
M. Andrew

                  


                  Title: 
Administrator

                  


                  Date:   September
19, 2008

                  


                  
                    
                      
                      

                    

                    
                      page
3

                      
                        

                      

                    

                    
                      
                      

                      RUS

                    

                  

                  


                  


                  


                  EXHIBIT
E

                  


                  TO

                  


                  BOND
PURCHASE AGREEMENT

                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  OPINION
OF BORROWER'S COUNSEL

                  


                  re:

                  


                  BORROWER'S
INSTRUMENTS



                
                  
                    
                    

                  

                  
                    
                    

                    
                      

                    

                  

                  
                    
                    

                    RUS

                  

                

                
                  


                  


                  


                  EXHIBIT
F

                  


                  TO

                  


                  BOND
PURCHASE AGREEMENT

                  


                  


                  


                  


                  FORM

                  


                  OF

                  


                  OPINION
OF RUS'S COUNSEL

                  


                  re:

                  


                  RUS
GUARANTEE

                   

                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                    

                  

                

              

            

          

        

      

    

    September
19, 2008

     

    MEMORANDUM
FOR JAMES M. ANDREW

        ADMINISTRATOR

        RURAL
UTILITIES SERVICE

    


    FROM:                                    
  Marc L. Kesselman

        General
Counsel

    


    SUBJECT:                                 Section
313A Legal Opinion

    


    This is
in response to a letter from Curtis M. Anderson, Acting Administrator of the
Rural Utilities Service (“RUS”), a Rural Development agency of the United States
Department of Agriculture, dated September 15, 2008, in which Mr. Anderson
requested an opinion from this office concerning your authority as Administrator
to execute and deliver a certain guarantee (the “Guarantee”) pursuant to the
Rural Electrification Act of 1936, as amended,1 and whether the Guarantee when executed by you
will be an incontestable obligation of the United States of America, acting
through RUS, supported by the full faith and credit of the United
States.

    


    More
particularly, the Guarantee is endorsed on a Future Advance Bond (the “Bond”)
dated September 19, 2008, being issued by the National Rural Utilities
Cooperative Finance Corporation (the “Borrower”), a District of Columbia
cooperative association, to the Federal Financing Bank (the “FFB”), a body
corporate and instrumentality of the United States of America.  We
understand that the Borrower is using the proceeds of the Bond for purposes
specified in section 313A of the RE Act (defined herein).

    


    We have
examined the following:

    


    1.           The
Rural Electrification Act of 1936, 7 U.S.C. §§ 901-950bb-1 (2008) (the “RE
Act”);

    


    2.           The
Food, Conservation, and Energy Act of 2008, Pub. L. No. 110-246, 122 Stat.
1651,  1958-59 (§ 6106) (2008) (the “Food, Conservation, and Energy
Act”);

    ________________

    
      1 We bring
to your attention the 2008 amendment to Section 313A(b)(1) of the Rural
Electrification Act of 1936, which removed the prohibition against a lender
receiving a guarantee under such section if, at the time of the guarantee, the
total principal amount of such guaranteed bond of the lender would exceed the
principal amount of outstanding loans of the lender for electrification or
telephone purposes that have been made concurrently with loans approved for such
purposes under the Rural Electrification Act of 1936.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    3.           The
Agriculture, Rural Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 2008, Pub. L. No. 110-161, 121 Stat. 1844, 1867-68
(2007) (the “Appropriations Act”);

    


    4.           Delegations
of authority from the Secretary of Agriculture to the Under Secretary for Rural
Development, 7 C.F.R. § 2.17 (2008), and redelegations from the Under Secretary
for Rural Development to the Administrator, Rural Utilities Service, 7 C.F.R. §
2.47 (2008);

    


    5.           The
executed Bond of the Borrower in the maximum principal amount of five hundred
million dollars ($500,000,000.00), having a final maturity date of October 15,
2031, and payable to FFB and any successor or assign of FFB; and

    


    6.           The
Guarantee endorsed by the Administrator of RUS which is attached to the
Bond.

    


    Based
upon the foregoing, having regard to legal considerations which we deem
relevant, we are of the opinion that:

    


    1.           You
are authorized under the RE Act, the Food, Conservation and Energy Act and the
Appropriations Act to execute and deliver the Guarantee;

    


    2.           The
Guarantee has been executed by you pursuant to section 313A of the RE Act;
and

    


    3.           The
Guarantee is an enforceable obligation of RUS supported by the full faith and
credit of the United States and incontestable except for fraud or
misrepresentation of which the holder of the Guarantee had actual knowledge at
the time it became a holder.

    


    Based on
the foregoing and upon such further investigation as we have deemed necessary,
we are of the opinion that:

    


    1.           The
execution and delivery of the RUS Guarantee by the Administrator is authorized
by applicable law.

    


    2.           The
RUS Guarantee has been executed and delivered by an official of RUS who is duly
authorized to execute and deliver such document on behalf of the
Administrator.

    


    3.           The
RUS Guarantee is a valid obligation of the United States of America for which
the full faith and credit of the United States of America are
pledged.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

        RUS

      

    

     

      


      


      EXHIBIT
G

      


      TO

      


      BOND
PURCHASE AGREEMENT

      


      


      


      


      FORM

      


      OF

      


      RUS
CERTIFICATE

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          RUS

        

      

    

    


    RUS
CERTIFICATE

    


    Federal
Financing Bank

    Main
Treasury Building

    1500
Pennsylvania Avenue, NW

    Washington,
DC  20220

     

    Reference is made to:

    


    
      	
               
      

            	
              (a)the
      Series C Bond Purchase Agreement dated as of September 19, 2008 (the "Bond
      Purchase Agreement"), by and among the Federal Financing Bank ("FFB"),
      National Rural Utilities Cooperative Finance Corporation (the "Borrower"),
      and the Administrator of the Rural Utilities Service ("RUS"), a Rural
      Development agency of the United States Department of
      Agriculture;

            


    

    


    
      	
               
      

            	
              (b)the
      Series C Bond dated as of September 19, 2008 (the "Bond"), issued by the
      Borrower payable to FFB in the maximum principal amount of
      $500,000,000.00; and

            


    

    


    
      	
               
      

            	
              (c)the
      RUS Guarantee dated as of September 19, 2008 (the "RUS
      Guarantee").

            


    

    


    Pursuant to sections 3.3.1(c) and
4.2(b) of the Bond Purchase Agreement, the undersigned hereby certifies the
following:

    


    
      	
               
      

            	
              1.I
      am the Administrator of RUS.

            


    

    


    
      	
               
      

            	
              2.I
      am furnishing this RUS Certificate to FFB with the intent that it be
      relied upon by FFB as a basis for taking or withholding action pursuant to
      the Bond Purchase Agreement.

            


    

    


    
      	
               
      

            	
              3.As
      the Administrator of RUS, I have executed the RUS Guarantee and caused it
      to be attached to the Bond.

            


    

    


    
      	
               
      

            	
              4.The
      executed RUS Guarantee conforms exactly to the form of "RUS Guarantee"
      prescribed in the Bond Purchase
Agreement.

            


    

    


    
      	
               
      

            	
              5.RUS
      retains custody of the executed original Bond as agent for FFB under the
      terms of the Bond Purchase Agreement, subject to delivery of actual
      possession of the original Bond to FFB upon request by
  FFB.

            


    

    


    
      	
               
      

            	
              6.RUS,
      as agent for FFB, has received from the Borrower the certification
      regarding lobbying that is required to be filed by recipients of federal
      loans, in the form 

            


    

     

    
      
        
        

      

      
        RUS CERT.
- page 1

        
          

        

      

      
        
        

        RUS

      

    

    
      
 

      
        	
                 
      

              	
                of
      certificate set forth in Appendix A to 31 C.F.R. Part 21, and, if
      required under 31 C.F.R. Part 21, the disclosure form to report
      lobbying, in the form of disclosure form set forth in Appendix B to 31
      C.F.R. Part 21.  RUS retains custody of the executed original
      certificate (and, if applicable, disclosure form) as agent for FFB under
      the terms of the Bond Purchase Agreement, subject to delivery of actual
      possession of the original certificate (and, if applicable, disclosure
      form) to FFB or its designate upon request by FFB or its
      designate.

              


      

       

    

    
      	
               
      

            	
              7.The
      Borrower does not have a judgment lien against any of the Borrower's
      property for a debt owed to the United States of
  America.

            


    

    


    


    IN WITNESS WHEREOF, the undersigned has
executed this RUS Certificate and caused it to be delivered to FFB.

    


     

    
      	
               
      

            	
              ADMINISTRATOR
      of the

            


    

    RURAL
UTILITIES SERVICE,

    


    


    


    By:     _______________________

    


    Name:   James
M. Andrew

    


    Title: 
Administrator

    


    Date:   September
19, 2008


    
      
        
        

      

      
        RUS CERT.
- page 2

        
          

        

      

      
        
        

        RUS

      

    

    


    


    


    EXHIBIT
H

    


    TO

    


    BOND
PURCHASE AGREEMENT

    


    


    


    


    FORM

    


    OF

    


    RUS
GUARANTEE

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        RUS

      

    

    
      


      RUS
GUARANTEE

      


       

      The United States of America, acting
through the Administrator of the Rural Utilities Service ("RUS"), a Rural
Development agency of the United States Department of Agriculture, hereby
guarantees to the Federal Financing Bank, its successors and assigns ("FFB"),
all payments of principal, interest, premium (if any), and late charges (if
any), when and as due in accordance with the terms of the Series C Bond dated
September 19, 2008, issued by National Rural Utilities Cooperative Finance
Corporation (the "Borrower") payable to FFB in the maximum principal amount of
$500,000,000.00, to which this RUS Guarantee is attached (such bond being the
"Bond"), with interest on the principal until paid, irrespective of
(i) acceleration of such payments under the terms of the Bond, or (ii)
receipt by RUS of any sums or property from its enforcement of its remedies for
the Borrower's default.

      


      This RUS Guarantee is issued pursuant
to section 313A of the Rural Electrification Act of 1936, as amended (7 U.S.C.
§ 940c-1), section 6 of the Federal Financing Bank Act of 1973
(12 U.S.C. § 2285), and the Series C Bond Purchase Agreement dated as
of September 19, 2008, among FFB, the Borrower, and RUS.

      


      


      UNITED STATES OF AMERICA

       

      


      By:     _______________________________

      


      Name:   James M.
Andrew

      


      Title:  Administrator
of

         the Rural Utilities
Service

      


      Date:   September 19,
2008

      
        
          
          

        

        
          RUS
GUARANTEE

          
            

          

        

        
          
          

          RUS