Document:

fixed_rate.htm

    MEMBER
CAPITAL SECURITIES MAY NOT BE TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION (“NATIONAL RURAL”) AND
ONLY NATIONAL RURAL’S VOTING MEMBERS MAY PURCHASE AND HOLD THE MEMBER CAPITAL
SECURITIES.  ANY PURPORTED TRANSFER OF MEMBER CAPITAL SECURITIES
WITHOUT NATIONAL RURAL’S PRIOR WRITTEN CONSENT WILL BE VOID AB
INITIO.

    

     

    Certificate
No.:

     

    PRINCIPAL
AMOUNT:

     

    INTEREST
RATE:

     

    MATURITY
DATE:

     

    ISSUE
DATE:

     

    INTEREST
PAYMENT DATES:

     

    REGULAR
RECORD
DATES:                                                                

    

    

    NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION

    

    MEMBER
CAPITAL SECURITIES

    

    National
Rural Utilities Cooperative Finance Corporation, a cooperative association duly
organized and existing under the laws of the District of Columbia (herein
referred to as the “Company”, which term includes any successor Person under the
Indenture), for value received, hereby promises to pay
to                                       ,
or registered assigns, the principal sum
of                                on
the Maturity Date set forth above and to pay interest thereon as set forth
below, until the principal hereof is paid or made available for
payment.

    Interest
on the member capital securities (the “Securities”) will be payable in arrears
on the Interest Payment Dates set forth above of each year, and at maturity,
commencing on ______ __, 20XX, at the rate of [     ]%
per annum.

    The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will be payable to, as provided in such Indenture, the Person in
whose name this Security is registered at the close of business on the Regular
Record Dates set forth above of each year.  Interest will be paid on
such principal sum from the Maturity Date or from the most recent Interest
Payment Date until the principal amount thereof becomes due and
payable.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Reference
is hereby made to the further provisions of this Security set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if forth at this place.

    Unless
the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof by manual signature, this Security shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    IN
WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.

    

    NATIONAL RURAL UTILITIES

    COOPERATIVE FINANCE
CORPORATION

    

    By:  _________________________________

    Name:

    Title:

    

    ATTEST:

    

    _________________________

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    CERTIFICATE
OF AUTHENTICATION

    

    Dated:

    

    This is
one of the Securities of the series designated herein referred to in the
within-mentioned Indenture.

    

    U.S. BANK NATIONAL
ASSOCIATION

    

    By:  _________________________________

    Authorized Signatory

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    REVERSE
OF SECURITY

    

    This
Security is one of a duly authorized issue of subordinated debt securities of
the Company (the “member capital securities,” and, herein called the
“Securities”), issued and to be issued in one or more series under an Indenture,
dated as of October 15, 1996, as amended (herein called the “Indenture”, which
term shall have the meaning assigned to it in such instrument), between the
Company and U.S. Bank National Association, as successor trustee (herein called
the “Trustee”, which term includes any successor trustee under the Indenture),
and reference is hereby made to the Indenture for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.  This
Security is one of the series designated on the face hereof, which series is
unlimited in aggregate principal amount.

    The
amount of interest payable on any Interest Payment Date shall be computed on the
basis of a 360-day year of twelve 30-day months.

    In the
event that any date on which interest is payable on the Securities is not a
Business Day, then payment of the interest payable on such date will be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the following month, such payment will be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date.  A “Business Day” is any week day other than a day on
which banking institutions in the borough of Manhattan, city and state of New
York are authorized by law to close or on which the Company is
closed.

    Any such
interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner, as
more fully provided in the Indenture referred to on the reverse
hereof.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Each
Security will be issued in certificated form.  Payment of the
principal of and any interest on this Security payable at maturity or upon
redemption will be made in immediately available funds at the office of the
paying agent in the Borough of Manhattan, the City of New
York.  Payments in immediately available funds will be made only if
the Security is presented to the paying agent in time for the paying agent to
make payments in immediately available funds in accordance with normal
procedures.  Interest on the Security will be paid by wire transfer in
immediately available funds, but only if appropriate instructions have been
received in writing by the paying agent on or prior to the applicable regular
record date for the payment of interest.  If no instructions have been
received in writing by the paying agent, the funds will be paid by check mailed
to the address of the person entitled to such interest.

    The
Securities of this series are subject to redemption upon not less than 30 nor
more than 60 days’ notice by mail, at any time on or after the date that is five
years from the Issue Date set forth on the front of this Security, as a whole or
in part, at the election of the Company, at a Redemption Price equal to 100% of
the principal amount to be redeemed, together in the case of any such redemption
with accrued interest to, but not including, the Redemption Date, but interest
installments whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holder of such Security, or one or more Predecessor
Securities, of record at the close of business on the related Regular Record
Date referred to on the face hereof, all as provided in the
Indenture.

    In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation
hereof.

    The
indebtedness evidenced by this Security is unsecured and subordinated and
subject in right of payment to the prior payment in full of all Senior
Indebtedness, which shall include all subordinated indebtedness of the Company
that may be held by or transferred to non-members of the Company, and this
Security is issued subject to the provisions of the Indenture with respect
thereto.  The Securities of this series will rank pari passu to the
Company’s member subordinated certificates.  Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes.  Each 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Holder
hereof, by his acceptance hereof, hereby waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of such Senior Indebtedness, whether now outstanding or hereafter
incurred, and waives reliance by each such Holder upon said
provisions.

    The
Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Security upon compliance with certain conditions set forth
in the Indenture.

    If an
Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the
Indenture.

    In
addition to the events of default set forth in the Indenture, the following will
constitute an Event of Default under the Indenture with respect to the
Securities: the Company shall pay any dividend or interest on, or principal of,
or redeem, purchase, acquire, retire or make a liquidation payment with respect
to, any Members’ Subordinated Certificates, Members’ Equity or patronage
capital, if such payment is made during an Extension Period, and either (i) such
Extension Period has not expired or been terminated or (ii) the Company has not
made all payments due on the Securities as a result of such expiration or
termination.

    No
payment will be made in respect of the Securities if, at the time of such
payment or immediately after giving effect thereto, (i) there exists a default
by the Company in the payment of principal or mandatory prepayments or premium,
if any, of sinking funds or interest on any senior or subordinated indebtedness
(as defined in the instrument under which the same is outstanding) of the
Company, or (ii) there shall have occurred an event of default (other than a
default in the payment of principal, premium, if any, mandatory prepayments,
sinking funds or interest) with respect to any senior or subordinated
indebtedness as defined in the instrument under which the same is outstanding
permitting the holders thereof (or of the indebtedness secured thereby) to
accelerate the maturity thereof (or of the indebtedness secured thereby), and
such event of default shall not have been cured or waived or shall not have
ceased to exist.

    The
Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Company and
the rights of the Holders of the Securities of each series to be affected under
the Indenture at any time by the Company and the Trustee with the consent of the
Holders of not less than a majority 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    in
aggregate principal amount of the Securities at the time Outstanding of each
series to be affected.  The Indenture also contains provisions
permitting the Holders of not less than a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences.  Any such consent or waiver by the Holder of this
Security shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.

    As
provided in and subject to the provisions of the Indenture, the Holder of this
Security shall not have the right to institute any proceeding with respect to
the Indenture or for the appointment of a receiver or trustee or for any other
remedy thereunder, unless such Holder shall have previously given the Trustee
written notice of a continuing Event of Default with respect to the Securities
of this series, the Holders of not less than 33 1/3% in aggregate principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in aggregate
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute any
such proceeding, for 60 days after receipt of such notice, request and offer of
indemnity.  The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or interest hereon on or after the respective due dates expressed
herein.

    No
reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of and interest on this Security at the
times, place and rate, and in the coin or currency, herein
prescribed.

    The
Company may at its option at any time and from time to time during the term of
the Securities of this series defer the interest payment period for a period not
exceeding 10 consecutive semi-annual interest payments (or an equivalent period
of quarterly or other interest payment periods) (a “Deferral Period”), and at
the end of such Deferral Period, the Company shall pay all interest then accrued
and unpaid (together with interest thereon at the same rate as specified for the
Securities of this series to the extent permitted by applicable law) through the
last day of such Deferral Period, provided that if any principal amount of this
Security is paid on such day, then not including interest for such day with
respect to such principal amount; provided, that during such Deferral Period the
Company may not declare or pay any dividend or interest on, or principal of, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
its Members’ Subordinated Certificates, Members’ Equity or patronage
capital.  Prior to the termination of any such Deferral Period, the
Company may further defer the payment of interest, provided that such Deferral
Period, together with all such previous and further deferrals thereof, may not
exceed 10 consecutive semi-annual interest payment periods (or an equivalent
period of quarterly or other interest payment periods) or extend beyond the
Stated Maturity of the Securities of this series.  Upon the
termination of any such Deferral Period and the payment of all amounts then due,
the Company may elect a new Deferral Period, subject to the above
conditions.  No interest during a Deferral Period, except at the end
thereof, shall be due and payable.  The Company shall give the Holder
of this Security notice of its intent to defer payment of interest in writing at
least ten business days before the earlier of (i) the next interest payment due
date and (ii) the date CFC is required to give notice to holders of the
Securities of the record or payment date for such interest payment.

    The
Securities of this series are issuable only in registered form without
coupons  and in minimum denominations of $25,000 and integral
multiples of $5,000 in excess thereof.  As provided in the Indenture
and subject to certain limitations therein set forth, Securities of this series
are exchangeable for a like aggregate principal amount of Securities of this
series and of like tenor and of authorized denominations, as requested by the
Holder surrendering the same.

    No
service charge shall be made for any such registration of transfer or exchange,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.

    The
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the absolute owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

    The Securities may not be transferred
without the Company’s prior written consent and only the Company’s voting
members may purchase and hold the securities.  Any 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    purported
transfer of the Securities without the Company’s prior written consent will be
void ab
initio.

    All terms
used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.floating_rate.htm

    MEMBER
CAPITAL SECURITIES MAY NOT BE TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION (“NATIONAL RURAL”) AND
ONLY NATIONAL RURAL’S VOTING MEMBERS MAY PURCHASE AND HOLD THE MEMBER CAPITAL
SECURITIES.  ANY PURPORTED TRANSFER OF MEMBER CAPITAL SECURITIES
WITHOUT NATIONAL RURAL’S PRIOR WRITTEN CONSENT WILL BE VOID AB
INITIO.

    

     

    Certificate
No.:

     

    PRINCIPAL
AMOUNT:

     

    MATURITY
DATE:

    ISSUE
DATE:                                                                

    INTEREST
PAYMENT DATES:

    REGULAR
RECORD DATES:

    INTEREST
RESET DATES:

    

    NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION

    

    FLOATING
RATE MEMBER CAPITAL SECURITIES

    

    National
Rural Utilities Cooperative Finance Corporation, a cooperative association duly
organized and existing under the laws of the District of Columbia (herein
referred to as the “Company”, which term includes any successor Person under the
Indenture), for value received, hereby promises to pay
to                                     ,
or registered assigns, the principal sum
of                                  on
the Maturity Date set forth above and to pay interest thereon as set forth
below, until the principal hereof is paid or made available for
payment.

    Interest
on the member capital securities (the “Securities”) will be payable in arrears
on the Interest Payment Dates set forth above of each year, and at maturity,
commencing on ______ __, 20XX.

    The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will be payable to, as provided in such Indenture, the Person in
whose name this Security is registered at the close of business on the Regular
Record Dates set forth above of each year.  Interest will be paid on
such principal sum from the Maturity Date or from the most recent Interest
Payment Date until the principal amount thereof becomes due and
payable.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Reference
is hereby made to the further provisions of this Security set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if forth at this place.

    Unless
the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof by manual signature, this Security shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

     

    IN
WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.

    

    NATIONAL RURAL UTILITIES

    COOPERATIVE FINANCE
CORPORATION

    

    By:  _________________________________

    Name:

    Title:

    ATTEST:

    

    _________________________

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    CERTIFICATE
OF AUTHENTICATION

    

    Dated:

    

    This is
one of the Securities of the series designated herein referred to in the
within-mentioned Indenture.

    

    U.S. BANK NATIONAL
ASSOCIATION

    

    By:  _________________________________

    Authorized Signatory

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    REVERSE
OF SECURITY

    

    This
Security is one of a duly authorized issue of subordinated debt securities of
the Company (the “member capital securities,” and, herein called the
“Securities”), issued and to be issued in one or more series under an Indenture,
dated as of October 15, 1996, as amended (herein called the “Indenture”, which
term shall have the meaning assigned to it in such instrument), between the
Company and U.S. Bank National Association, as successor trustee (herein called
the “Trustee”, which term includes any successor trustee under the Indenture),
and reference is hereby made to the Indenture for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.  This
Security is one of the series designated on the face hereof, which series is
unlimited in aggregate principal amount.

    The
amount of interest payable on any Interest Payment Date shall be computed on the
basis of the actual number of days in the applicable interest period divided by
360.

    The
Securities will bear interest for each interest period at a rate determined by
the Calculation Agent, which shall initially be the Company, until such time as
the Company appoints a successor calculation agent (herein called the
“Calculation Agent”, which term includes any successor Calculation
Agent).  All calculations of the Calculation Agent, in the absence of
manifest error, shall be conclusive for all purposes and binding on the Company,
the Holders and the Trustee.

    In the
event that any date on which interest is payable on the Securities is not a
Business Day, then payment of the interest payable on such date will be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the following month, such payment will be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date.

    Any
interest not punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Trustee,
notice whereof shall be given to Holders of Securities of this series not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner, as more fully provided in the Indenture referred to on the
reverse hereof.

    The
interest rate on each Security will equal the interest rate calculated by
reference to the specified interest rate formula set forth in an applicable
pricing supplement plus or minus any Spread and/or multiplied by an Spread
Multiplier.  The applicable pricing supplement will designate one or
more interest rate bases for the Security.  The basis or bases will be
determined by reference to the London Interbank Offered Rate (“LIBOR”) or
another interest rate basis or formula as set forth in the pricing
supplement.  A Security with a basis or bases determined by reference
to LIBOR shall be a LIBOR Security.  If a Security’s basis is
determined by reference to another interest rate, the Security shall be a
Floating Rate Security.

    The rate
of interest on each Security will be reset according to the index maturity, as
specified in the applicable pricing supplement.  Unless specified
otherwise in the applicable pricing supplement, the interest rate will be reset
each Interest Reset Date.  The Interest Reset Dates shall be as set
forth on the front page hereof.  The interest rate for the first
interest period will be the initial interest rate set forth in the applicable
pricing supplement.  The interest rate for the ten calendar days
immediately prior to the Security’s maturity will be that in effect on the tenth
calendar day preceding maturity, unless otherwise specified in an applicable
pricing supplement.

    If any
Interest Reset Date would otherwise be a day that is not a business day, the
Interest Reset Date shall be postponed to the next succeeding business
day.  For this purpose, “business day” shall mean (i) with respect to
a LIBOR Security, any day on which dealings in deposits in United States dollars
are transacted in the London interbank market, or, (ii) with respect to a
Floating Rate Security, any week day other than a day on which banking
institutions in the borough of Manhattan, city and state of New York are
authorized by law to close.

    The
interest determination date pertaining to an Interest Reset Date for a LIBOR
Security shall be the second London business day prior to that Interest Reset
Date.

     The
interest rate on the Floating Rate Securities shall not exceed the maximum rate
permitted by applicable law.  Upon the request of a Holder, the
Calculation Agent will provide the interest rate which will become effective as
a result of a determination made on the most recent interest determination date
with respect to that Security.  Unless otherwise
specified

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     in
an applicable pricing supplement, the calculation date, if applicable,
pertaining to any interest determination date will be the earlier of the tenth
calendar day after such interest determination date, or, if such day is not a
business day, the next succeeding business day or the business day preceding the
applicable interest payment date or maturity.

    LIBOR
will be determined by the Calculation Agent in accordance with the following
provisions:

    With
respect to any Interest Determination Date, LIBOR will be the rate for deposits
in U.S. dollars having a maturity of three months commencing on the Interest
Reset Date that appears on the designated LIBOR page as of 11:00 a.m., London
time, in respect of that Interest Determination Date.   If no
rate appears at such time on an Interest Determination Date, LIBOR on such
Interest Determination Date will be determined as follows:

    The
Calculation Agent will request the principal London offices of each of four
major reference banks in the London interbank market, as selected by the
calculation agent, to provide the Calculation Agent with its offered quotation
for deposits in United States dollars for the period of three months, commencing
on the Interest Reset Date, to prime banks in the London Interbank market at
approximately 11:00 A.M., London time, on that Interest Determination Date and
in a principal amount that is representative for a single transaction in United
States dollars in the market at the time.  If at least two quotations
are so provided, LIBOR on the Interest Determination Date will be the arithmetic
mean of the quotations.  If fewer than two quotations are so provided,
LIBOR on the Interest Determination Date will be arithmetic mean of the rates
quoted at approximately 11:00 A.M., New York City time, on the Interest
Determination Date by three major banks in the City of New York selected by the
Calculation Agent for loans in United States dollars to leading European banks,
having a three-month maturity and in a principal amount that is representative
for a single transaction in U.S. dollars in that market at that
time.  If the banks so selected by the Calculation Agent are not
providing quotations as provided above, LIBOR determined as of that Interest
Determination Date will be LIBOR in effect on that Interest Determination
Date.

    The
Calculation Agent will, upon the request of the holder of any Security, provide
the interest rate then in effect.

    Each
Security will be issued in certificated form.  Payment of the
principal of and any interest on this Security payable at maturity or upon
redemption will be made in immediately 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    available
funds at the office of the paying agent in the Borough of Manhattan, the City of
New York.  Payments in immediately available funds will be made only
if the Security is presented to the paying agent in time for the paying agent to
make payments in immediately available funds in accordance with normal
procedures.  Interest on the Securities will be paid by wire transfer
in immediately available funds, but only if appropriate instructions have been
received in writing by the paying agent on or prior to the applicable regular
record date for the payment of interest.   If no instructions
have been received in writing by the paying agent, the funds will be paid by
check mailed to the address of the person entitled to such
interest.

    The
Securities of this series are subject to redemption upon not less than 30 nor
more than 60 days’ notice by mail, at any time on or after the date that is five
years from the Issue Date set forth on the front of this Security, as a whole or
in part, at the election of the Company, at a Redemption Price equal to 100% of
the principal amount to be redeemed, together in the case of any such redemption
with accrued interest to, but not including, the Redemption Date, but interest
installments whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holder of such Security, or one or more Predecessor
Securities, of record at the close of business on the related Regular Record
Date referred to on the face hereof, all as provided in the
Indenture.

    In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation
hereof.

    The
indebtedness evidenced by this Security is unsecured and subordinated and
subject in right of payment to the prior payment in full of all Senior
Indebtedness, which shall include all subordinated indebtedness of the Company
that may be held by or transferred to non-members of the Company, and this
Security is issued subject to the provisions of the Indenture with respect
thereto.  The Securities of this series will rank pari passu to the
Company’s member subordinated certificates.  Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes.  Each Holder hereof, by his acceptance
hereof, hereby waives all notice of the acceptance of the subordination
provisions contained herein and in the Indenture by each holder of such Senior

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Indebtedness,
whether now outstanding or hereafter incurred, and waives reliance by each such
Holder upon said provisions.

    The
Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Security upon compliance with certain conditions set forth
in the Indenture.

    If an
Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the
Indenture.

    In
addition to the events of default set forth in the Indenture, the following will
constitute an Event of Default under the Indenture with respect to the
Securities: the Company shall pay any dividend or interest on, or principal of,
or redeem, purchase, acquire, retire or make a liquidation payment with respect
to, any Members’ Subordinated Certificates, Members’ Equity or patronage
capital, if such payment is made during an Extension Period, and either (i) such
Extension Period has not expired or been terminated or (ii) the Company has not
made all payments due on the Securities as a result of such expiration or
termination.

    No
payment will be made in respect of the Securities if, at the time of such
payment or immediately after giving effect thereto, (i) there exists a default
by the Company in the payment of principal or mandatory prepayments or premium,
if any, of sinking funds or interest on any senior or subordinated indebtedness
(as defined in the instrument under which the same is outstanding) of the
Company, or (ii) there shall have occurred an event of default (other than a
default in the payment of principal, premium, if any, mandatory prepayments,
sinking funds or interest) with respect to any senior or subordinated
indebtedness as defined in the instrument under which the same is outstanding
permitting the holders thereof (or of the indebtedness secured thereby) to
accelerate the maturity thereof (or of the indebtedness secured thereby), and
such event of default shall not have been cured or waived or shall not have
ceased to exist.

    The
Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Company and
the rights of the Holders of the Securities of each series to be affected under
the Indenture at any time by the Company and the Trustee with the consent of the
Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding of each series to be affected.  The
Indenture also contains provisions permitting the Holders of not less than a

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    majority
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences.  Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.

    As
provided in and subject to the provisions of the Indenture, the Holder of this
Security shall not have the right to institute any proceeding with respect to
the Indenture or for the appointment of a receiver or trustee or for any other
remedy thereunder, unless such Holder shall have previously given the Trustee
written notice of a continuing Event of Default with respect to the Securities
of this series, the Holders of not less than 33 1/3% in aggregate principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in aggregate
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute any
such proceeding, for 60 days after receipt of such notice, request and offer of
indemnity.  The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or interest hereon on or after the respective due dates expressed
herein.

    No
reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of and interest on this Security at the
times, place and rate, and in the coin or currency, herein
prescribed.

    The
Company may at its option at any time and from time to time during the term of
the Securities of this series defer the interest payment period for a period not
exceeding 10 consecutive semi-annual interest payments (or an equivalent period
of quarterly or other interest payment periods) (a “Deferral Period”), and at
the end of such Deferral Period, the Company shall pay all interest then accrued
and unpaid (together with interest thereon at the same rate as specified for the
Securities of this series to the extent permitted by applicable law) through the
last day of such Deferral Period, provided that if any principal amount of this
Security is paid on 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    such day,
then not including interest for such day with respect to such principal amount;
provided, that during such Deferral Period the Company may not declare or pay
any dividend or interest on, or principal of, or redeem, purchase, acquire or
make a liquidation payment with respect to, any of its Members’ Subordinated
Certificates, Members’ Equity or patronage capital.  Prior to the
termination of any such Deferral Period, the Company may further defer the
payment of interest, provided that such Deferral Period, together with all such
previous and further deferrals thereof, may not exceed 10 consecutive
semi-annual interest payment periods (or an equivalent period of quarterly or
other interest payment periods) or extend beyond the Stated Maturity of the
Securities of this series.  Upon the termination of any such Deferral
Period and the payment of all amounts then due, the Company may elect a new
Deferral Period, subject to the above conditions.  No interest during
a Deferral Period, except at the end thereof, shall be due and
payable.  The Company shall give the Holder of this Security notice of
its intent to defer payment of interest in writing at least ten business days
before the earlier of (i) the next interest payment due date and (ii) the date
CFC is required to give notice to holders of the Securities of the record or
payment date for such interest payment.

    The
Securities of this series are issuable only in registered form without coupons
and in minimum denominations of $25,000 and integral multiples of $5,000 in
excess thereof.  As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
and of authorized denominations, as requested by the Holder surrendering the
same.

    No
service charge shall be made for any such registration of transfer or exchange,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.

    The
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the absolute owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

    The Securities may not be transferred
without the Company’s prior written consent and only the Company’s voting
members may purchase and hold the securities.  Any purported transfer
of the Securities without the Company’s prior written consent will be void ab initio.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    The
following terms shall have the following meanings:

     A
“Business Day” is any week day other than a day on which banking institutions in
the borough of Manhattan, city and state of New York are authorized by law to
close or on which the Company is closed.

    The
“designated LIBOR page” is the Reuters screen “LIBOR01”, or any successor
service for the purpose of displaying the London interbank rates of major banks
for U.S. dollars.  The Reuters screen “LIBOR01” is the display
designated as the Reuters screen “LIBOR01”, or such other page as may replace
the Reuters screen “LIBOR01” on that service or such other service or services
as may be denominated by the British Bankers’ Association for the purpose of
displaying London interbank offered rates for U.S. dollar deposits.

    The
“Spread” is the number of basis points specified in the applicable pricing
supplement as applying to the interest rate for the Security.

    The
“Spread Multiplier” is the percentage specified in the applicable pricing
supplement as applying to the interest rate for the Security.

    All terms
used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00157-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00157-of-00352.parquet"}]]