Document:

fm_pledgeargmt.htm

    

     

    

    
      	
               

              FARMER
      MAC MORTGAGE

              SECURITIES
      CORPORATION,

              As
      Note Purchaser

               

               

              NATIONAL
      RURAL UTILITIES

              COOPERATIVE
      FINANCE CORPORATION,

              As
      Borrower

               

               

              U.S.
      BANK NATIONAL ASSOCIATION,

              As
      Collateral Agent

               

               

              FEDERAL
      AGRICULTURAL

              MORTGAGE
      CORPORATION,

              As
      Guarantor

              _______________________________

               

              PLEDGE
      AGREEMENT

              _______________________________

               

              Dated
      as of February 5, 2009

               

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	 
      	 
      
	
                ARTICLE
      I

              	 
      
	 
      	 
      
	
                Definitions

              	 
      
	
                Section
      1.01.  Definitions

              	
                2

              
	
                Section
      1.02.  Principles of Construction

              	
                5

              
	 
      	 
      
	
                ARTICLE
      II

              	 
      
	 
      	 
      
	
                Provision
      as to Pledged Collateral

              	 
      
	 
      	 
      
	
                Section
      2.01.  Holding of Pledged Securities

              	
                6

              
	
                Section
      2.02.  UCC Filings

              	
                6

              
	
                Section
      2.03.  Withdrawal and Substitution of Pledged
      Collateral

              	
                7

              
	
                Section
      2.04.  [Reserved]

              	
                7

              
	
                Section
      2.05.  Addition of Pledged Collateral

              	
                7

              
	
                Section
      2.06.  Accompanying Documentation

              	
                7

              
	
                Section
      2.07.  Renewal; Extension; Substitution

              	
                8

              
	
                Section
      2.08.  Voting Rights; Interest and Principal

              	
                8

              
	
                Section
      2.09.  Protection of Title; Payment of Taxes; Liens,
      etc

              	
                9

              
	
                Section
      2.10.  Maintenance of Pledged Collateral

              	
                10

              
	
                Section
      2.11.  Representations, Warranties and Covenants

              	
                10

              
	
                Section
      2.12.  Further Assurances

              	
                11

              
	 
      	 
      
	
                ARTICLE
      III

              	 
      
	 
      	 
      
	
                [Reserved]

              	 
      
	 
      	 
      
	
                ARTICLE
      IV

              	 
      
	 
      	 
      
	
                Remedies

              	 
      
	 
      	 
      
	
                Section
      4.01.  Events of Default

              	
                12

              
	
                Section
      4.02.  Remedies upon Default

              	
                12

              
	
                Section
      4.03.  Application of Proceeds

              	
                14

              
	
                Section
      4.04.  Securities Act

              	
                15

              
	 
      	 
      
	
                ARTICLE
      V

              	 
      
	 
      	 
      
	
                The
      Collateral Agent

              	 
      
	 
      	 
      
	
                Section
      5.01.  Certain Duties and Responsibilities

              	
                15

              
	
                Section
      5.02.  Certain Rights of Collateral Agent

              	
                16

              
	
                Section
      5.03.  Money Held by Collateral Agent

              	
                18

              
	
                Section
      5.04.  Compensation and Reimbursement

              	
                18

              

      

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      
        	
                Section
      5.05.  Corporate Collateral Agent Required;
      Eligibility

              	
                19

              
	
                Section
      5.06.  Resignation and Removal; Appointment of
      Successor

              	
                20

              
	
                Section
      5.07.  Acceptance of Appointment by Successor

              	
                20

              
	
                Section
      5.08.  Merger, Conversion, Consolidation or Succession to
      Business

              	
                21

              
	 
      	 
      
	
                ARTICLE
      VI

              	 
      
	 
      	 
      
	
                Miscellaneous

              	 
      
	 
      	 
      
	
                Section
      6.01.  Notices

              	
                21

              
	
                Section
      6.02.  Waivers; Amendment

              	
                21

              
	
                Section
      6.03  Successors and Assigns

              	
                22

              
	
                Section
      6.04  Counterparts; Effectiveness

              	
                22

              
	
                Section
      6.05  Severability

              	
                22

              
	
                Section
      6.06  GOVERNING LAW

              	
                22

              
	
                Section
      6.07  WAIVER OF JURY TRIAL

              	
                22

              
	
                Section
      6.08  Headings

              	
                23

              
	
                Section
      6.09  Security Interest Absolute

              	
                23

              
	
                Section
      6.10  Termination or Release

              	
                23

              
	
                Section
      6.11  Collateral Agent Appointed
Attorney-in-Fact

              	
                23

              
	 
      	 
      
	 
      	 
      
	
                Schedule
      I – Additional Criteria for Eligible Securities

              	 
      
	
                Schedule
      II – Addresses for Notices

              	 
      
	 
      	 
      
	
                Annex
      A – Form of Certificate of Pledged Collateral

              	 
      
	 
      	 
      

      

    

                                                                                                                              

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

     

    PLEDGE
AGREEMENT, dated as of February 5, 2009, among NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION, a District of Columbia cooperative association
and its successors and assigns (hereinafter called “National Rural”),
FARMER MAC MORTGAGE SECURITIES CORPORATION, (the “Purchaser”), a wholly owned
subsidiary of FEDERAL AGRICULTURAL MORTGAGE CORPORATION, a federally-chartered
instrumentality of the United States and an institution of the Farm Credit
System and its successors and assigns (“Farmer Mac”), U.S.
BANK NATIONAL ASSOCIATION, a national banking association and its successors and
assigns (hereinafter called the “Collateral Agent”),
and Farmer Mac, as Guarantor.

     

    RECITALS
OF NATIONAL RURAL

     

    WHEREAS,
National Rural may from time to time issue one or more Notes to the Purchaser,
and the Purchaser may purchase such Notes, all upon the terms and subject to the
conditions set forth in the Note Purchase Agreement; and

     

    WHEREAS,
National Rural is required pursuant to the terms of the Note Purchase Agreement
to pledge certain property to the Collateral Agent for the benefit of the
Control Party to secure National Rural’s obligations on the Notes;

     

    NOW,
THEREFORE, THIS PLEDGE AGREEMENT WITNESSETH that, to secure the performance of
the certain Obligations contained in the Notes, the Note Purchase Agreement and
herein, National Rural hereby assigns and pledges to the Collateral Agent, its
successors and assigns, for the benefit of the Control Party, and grants to the
Collateral Agent, its successors and assigns, for the benefit of the Control
Party, a security interest in the following (collectively referred to as the
“Pledged
Collateral”) as provided in Article II: (a)(i) the Pledged
Securities and the certificates representing the Pledged Securities;
(ii) subject to Section 2.08, all payments of principal or interest,
cash, instruments and other property from time to time received, receivable or
otherwise distributed in respect of, in exchange for, and all other Proceeds
received in respect of, the Pledged Securities pledged hereunder;
(iii) subject to Section 2.08, all rights and privileges of National
Rural with respect to the Pledged Securities; (iv) all Proceeds of any of
the foregoing above; that may, on the date hereof or from time to time
hereafter, be subjected to the Lien hereof by National Rural by delivery,
assignment or pledge thereof to the Collateral Agent hereunder and the
Collateral Agent is authorized to receive the same as additional security
hereunder (subject to any reservations, limitations or conditions agreed to in
writing by National Rural and the Control Party respecting the scope or priority
of such security or the use and disposition of such property or the Proceeds
thereof).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    TO HAVE
AND TO HOLD the Pledged Collateral, together with all right, title, interest,
powers, privileges and preferences pertaining or incidental thereto, unto the
Collateral Agent, its successors and assigns, for the benefit of the Control
Party, forever; subject, however, to the
terms, covenants and conditions hereinafter set forth.

     

     

    ARTICLE
I

     

    Definitions

     

    SECTION
1.01. Definitions.  As
used in this Pledge Agreement, the following terms shall have the following
meanings:

     

    “Accounting
Requirements” shall mean any system of accounts prescribed by a federal
regulatory authority having jurisdiction over the Member or, in the absence
thereof, the requirements of GAAP applicable to businesses similar to that of
the Member.

     

    “Allowable Amount” on
any date, means with respect to Eligible Securities, the aggregate principal
amount of such Eligible Securities theretofore advanced thereon which remains
unpaid on such date.

     

    “Certificate of Pledged
Collateral” means a certificate delivered to the Collateral Agent and the
Control Party substantially in the form of Annex A attached
hereto.

     

    “Class A Member” means
any Class A Member of National Rural as described in National Rural’s Bylaws
currently in effect.

     

    “Class B Member” means
any Class B Member of National Rural as described in National Rural’s Bylaws
currently in effect.

     

    “Collateral Agent”
means the Person named as the “Collateral Agent” in
the first paragraph of this instrument.

     

    “Control Party” means
(i) the Guarantor, so long as no Guarantor Default has occurred and is
continuing, or (ii) the holders of the Notes for so long as a Guarantor Default
has occurred and is continuing.

     

    “Control Party Notice”
and “Control Party
Order” mean, respectively, a written notice or order signed by any Vice
President of the Control Party and delivered to the Collateral Agent and
National Rural.

     

    “Control Party Notice of
Default” has the meaning given to that term in
Section 4.02.

     

    
      
        
        

      

      
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    “Depreciation and
Amortization Expense” shall mean an amount
constituting the depreciation and amortization of the Member computed pursuant
to Accounting Requirements.

    

    “Eligible Member”
means any Class A Member or Class B Member of National Rural as described in
National Rural’s Bylaws currently in effect.

    

    “Eligible Security”
means a note or bond of any Eligible Member payable or registered to, or to the
order of, National Rural, (A) in respect of which (i) the outstanding
principal amount under such note or bond, together with the outstanding
principal amount of any other notes or bonds of such Eligible Member pledged
hereunder or pledged to secure any other notes or bonds issued by National Rural
to Farmer Mac or any affiliate or sold by National Rural or any affiliate to any
trust whose beneficial ownership is owned or controlled by Farmer Mac, does not
aggregate more than $35 million, (ii) no default has occurred in the payment of
principal or interest in accordance with the terms of such note or bond that is
continuing beyond the contractual grace period (if any) provided in such note or
bond for such payment and (iii) no “event of default” as defined in such
note or bond (or in any instrument creating a security interest in favor of
National Rural in respect of such note or bond), shall exist that has resulted
in the exercise of any right or remedy described in such note or bond (or in any
such instrument); (B) which is not classified by National Rural as a
non-performing loan under generally accepted accounting principles in the United
States; and (C) which otherwise satisfies the criteria set forth on Schedule I
hereto.

     

    “Equity” means the
aggregate of the Member's equities and margins computed pursuant to Accounting
Requirements.

     

    “Event of Default” has
the meaning set forth in Section 4.01.

     

    “Facility Rating”
means the facility rating assigned by National Rural to an Eligible Security
from time to time in accordance with National Rural's internal risk rating
system.

     

    “GAAP” means generally
accepted accounting principles in the United States as in effect from time to
time.

     

    “Guarantor Default”
means a default by the Guarantor under its obligations pursuant to Article IX of
the Note Purchase Agreement which is existing and continuing.

     

    “Interest Expense”
means an amount constituting the interest expense with respect to Long-Term Debt
of the Member computed pursuant to Accounting Requirements.

     

    “Lien” means any lien,
pledge, charge, mortgage, encumbrance, debenture, hypothecation or other similar
security interest attaching to any part of the Pledged Collateral.

     

    
      
        
        

      

      
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    “Lien of this Pledge
Agreement” or “Lien hereof” means
the Lien created by these presents.

     

    “Long-Term Debt” is
determined in accordance with the Uniform System of Accounts prescribed at the
time by RUS or, if such Member is not required to maintain its accounts in
accordance with said Uniform System of Accounts, otherwise determined in
accordance with GAAP.

     

    “Member” shall mean
any Person who is member of National Rural.

     

    “Modified Debt Service
Coverage Ratio--Distribution” shall mean the definition of Coverage Ratio
as defined in the Indenture dated October 25, 2007 by and between National Rural
Utilities Cooperative Finance Corporation and U.S. Bank National Association for
the Collateral Trust Bonds.

     

    "Modified Debt Service
Coverage Ratio--G&T" shall mean the ratio determined as follows: for
any calendar year add (i) Operating Margins, (ii) Non-Operating
Margins--Interest, (iii) Interest Expense, (iv) Depreciation and Amortization
Expense, and (v) cash received in respect of generation and transmission and
other capital credits, and divide the sum so obtained by the sum of all payments
of Principal and Interest Expense required to be made during such calendar year;
provided, however, that in the
event that any amount of Long-Term Debt has been refinanced during such year,
the payments of Principal and Interest Expense required to be made during such
year on account of such refinanced amount of Long-Term Debt shall be based (in
lieu of actual payments required to be made on such refinanced amount of
Long-Term Debt) upon the larger of (i) an annualization of the payments required
to be made with respect to the refinancing debt during the portion of such year
such refinancing debt is outstanding or (ii) the payment of Principal and
Interest Expense required to be made during the following year on account of
such refinancing debt.

    

    “National Rural
Notice” and “National Rural Order”
mean, respectively, a written notice or order signed in the name of National
Rural by either its Chief Executive Officer or its Chief Financial Officer, and
by any Vice President of National Rural, and delivered to the Collateral Agent
and the Control Party.

     

    “Non-Operating
Margins—Interest” means the amount representing the interest component of
non-operating margins of the Member computed pursuant to Accounting
Requirements.

     

    “Note Purchase
Agreement” means the Note Purchase Agreement dated the date hereof
between National Rural, the Purchaser and Farmer Mac, as the same may be amended
from time to time in accordance with the terms thereof.

     

    “Notes” means the note
or notes issued by National Rural to the Purchaser under the Note Purchase
Agreement.

     

    “Obligations” means
the due and punctual performance of the obligations of National Rural to make
payments of principal, and interest on the Notes.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    “Officers’
Certificate” means a certificate signed by any Vice President of National
Rural, and delivered to the Control Party and/or the Collateral Agent, as
applicable.

     

    “Operating Margins”
means the amount of patronage capital and operating margins of the Member
computed pursuant to Accounting Requirements.

     

    “Person” means any
individual, corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or govern­ment or any agency or
political subdivision thereof.

     

    “Pledge Agreement”
means this Pledge Agreement, as originally executed and as it may from time to
time be amended pursuant to the applicable provisions hereof.

     

    “Pledged Collateral”
has the meaning set forth in the Granting Clause.

     

    “Pledged Securities”
means at any time the Eligible Securities listed on Schedule A and/or
Schedule B to the Certificate of Pledged Collateral most recently
delivered.

     

    “Principal” means the
amount of principal billed on account of Long-Term Debt of the Member computed
pursuant to Accounting Requirements.

     

    “Proceeds” has the
meaning specified in Section 9-102 of the Uniform Commercial
Code.

     

    “RUS” mean the Rural
Utilities Service of the United States Department of Agriculture, acting by and
through the Administrator of the Rural Utilities Service, and including any
successor agencies or departments.

     

    “Total Assets Ratio”
means an amount constituting the total assets of the Member computed pursuant to
Accounting Requirements.

     

    “Total Capitalization
Ratio” means the Total Margins and Equity as a percentage of the sum of
((1)Total Margins and Equity plus (2) Long Term Debt).

     

    “Total Margins and
Equity” means the Member’s total margins and equity computed pursuant to
Accounting Requirements.

     

    “Uniform Commercial
Code” means the Uniform Commercial Code as from time to time in effect in
the District of Columbia.

     

    “Vice President” means
any vice president of National Rural or Farmer Mac or the Purchaser, as
applicable, whether or not designated by a number or a word or words added
before or after the title “vice president”.

     

    SECTION
1.02. Other Defined Terms;
Principles of Construction.  Capitalized terms used but not
defined in this Pledge Agreement shall have the meanings 

     

    
      
        
        

      

      
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    given to
them in the Note Purchase Agreement.  Unless the context shall
otherwise indicate, the terms defined in Section 1.01 hereof include the
plural as well as the singular and the singular as well as the
plural.  The words “hereafter”, “herein”, “hereof”, “hereto” and
“hereunder”, and words of similar import, refer to this Agreement as a
whole.  The descriptive headings of the various articles and sections
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.

     

     

    ARTICLE
II   

     

    Provisions as to Pledged
Collateral

     

    SECTION
2.01. Holding of Pledged
Securities.

     

    (a) National
Rural shall make available to the Control Party, within thirty (30) days of a
pledge of the Pledged Securities in connection with an advance (or for a longer
period as National Rural and the Control Party agree), such back-up information
as is reasonably necessary in order to allow the Control Party to confirm
compliance of such Pledged Securities to the requisite criteria as outlined
herein.  Upon receipt of the back-up information, the Control Party
shall have ninety (90) days to object in writing to the inclusion of any item of
the Pledged Securities as part of the Pledged Collateral.  If the
Control Party reasonably determines that any of the Pledged Securities do not
meet the criteria for Eligible Securities, then National Rural shall have thirty
(30) days in which to provide substitute collateral, and the timeline specified
above for National Rural to make available back-up material and confirmation
shall also apply as to the substituted collateral.

     

    (b) The
Collateral Agent, on behalf of the Control Party, shall hold the Pledged
Securities in the name of National Rural (or its nominee), endorsed or assigned
in blank or in favor of the Collateral Agent.  Upon occurrence of an
Event of Default, the Collateral Agent, on behalf of the Control Party, shall
have the right (in its sole and absolute discretion), to the extent a register
is maintained therefor, to register the Pledged Securities in the Collateral
Agent’s own name as pledgee, or in the name of the Collateral Agent’s nominee
(as pledgee or as sub-agent) or to continue to hold the Pledged Securities in
the name of National Rural, endorsed or assigned in blank or in favor of the
Collateral Agent.  Upon cessation of such Event of Default, the
Collateral Agent shall take such action as is necessary to again cause the
Pledged Securities to be registered in the name of National Rural (or its
nominee).

     

    SECTION
2.02. UCC
Filings.  National Rural shall prepare and file in the proper
Uniform Commercial Code filing office in the District of Columbia (i) on or
prior to the date of the first purchase of a Note under the Note Purchaser
Agreement, a financing statement recording the Collateral Agent’s interest in
the Pledged Collateral; and (ii) from time to time thereafter, continuation
statements or such other filings as are necessary to maintain the perfection of
the Lien hereof on the Pledged Collateral.

     

    
      
        
        

      

      
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    SECTION
2.03. Withdrawal and Substitution
of Pledged Collateral.

     

    (a)  Any
part of the Pledged Collateral may be withdrawn by National Rural or substituted
for other Eligible Securities by National Rural and shall be delivered to
National Rural by the Collateral Agent upon National Rural Order at any time and
from time to time, together with any other documents or instruments of transfer
or assignment necessary to reassign to National Rural said Pledged Collateral
and the interest of National Rural, provided the
aggregate Allowable Amount of Pledged Collateral remaining after such withdrawal
or substitution shall at least equal the aggregate principal amount of the Notes
outstanding after such withdrawal or substitution, as shown by the Certificate
of Pledged Collateral furnished to the Collateral Agent pursuant to
Subsection (b)(i) of this Section.

     

    (b) Prior to
any such withdrawal or substitution, the Collateral Agent shall be furnished
with the following instruments:

     

    (i) a
Certificate of Pledged Collateral, dated as of the last day of the calendar
month most recently ended at least 10 Business Days prior to such withdrawal or
substitution (or a more recent date, at National Rural’s option), showing that
immediately after such withdrawal or substitution the requirements of Subsection
(a) of this Section will be satisfied; and

     

    (ii) an
Officers’ Certificate certifying that no Event of Default has occurred which has
not been remedied.

     

    Upon any
such withdrawal or substitution, National Rural shall deliver any Eligible
Securities to be substituted and the Collateral Agent shall execute any
instruments of transfer or assignment specified in a National Rural Order as
necessary to vest in National Rural any part of the Pledged Collateral
withdrawn.

     

    In case
an Event of Default shall have occurred and be continuing, National Rural shall
not withdraw or substitute any part of the Pledged Collateral.

     

    SECTION
2.04. [Reserved.]

     

    SECTION
2.05. Addition of Pledged
Collateral.  At any time, National Rural may pledge additional
Eligible Securities under this Pledge Agreement by delivering such Pledged
Collateral to the Collateral Agent, accompanied by a Certificate of Pledged
Collateral specifying such additional collateral and dated as of the last day of
the calendar month most recently ended at least 10 Business Days prior thereto
(or a more recent date at National Rural’s option).

     

    SECTION
2.06. Accompanying
Documentation.  Where Eligible Securities are delivered to the
Collateral Agent under Section 2.01, 2.03 or Section 2.05, such securities
shall be accompanied by the appropriate instruments of transfer executed in
blank and in a form satisfactory to the Collateral Agent and by such other
instruments and documents as the Collateral Agent may reasonably
request.  All other property delivered to the Collateral Agent under
Section 2.01, 2.03 or Section 2.05 and comprising part of the Pledged
Collateral shall be accompanied by proper instruments of assignment

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    duly
executed by National Rural and such other instruments or documents as the
Collateral Agent may reasonably request.

     

    SECTION
2.07. Renewal; Extension;
Substitution.  Unless and until an Event of Default shall have
occurred and be continuing, National Rural may at any time renew or extend,
subject to the Lien of this Pledge Agreement, any Pledged Security upon any
terms or may accept in place of and in substitution for any such
Pledged  Security, another Eligible Security or Securities of the same
issuer or of any successor thereto for at least the same unpaid principal
amount, all as evidenced by a National Rural Order delivered to the Collateral
Agent; provided, however, that in case
of any substitution, Eligible Securities substituted as aforesaid shall be
subject to the Lien of this Pledge Agreement as part of the Pledged Collateral
and be held in the same manner as those for which they shall be substituted, and
in the case of each substituted Eligible Security National Rural shall provide
an Officers’ Certificate certifying to the Collateral Agent that such
substituted security satisfies the requirements of this Section.  So
long as no Event of Default shall have occurred and be continuing, the
Collateral Agent, upon National Rural Order stating that no Event of Default
shall have occurred and be continuing, shall execute any consent to any such
renewal, extension or substitution as shall be specified in such National Rural
Order.

     

    SECTION
2.08. Voting Rights; Interest and
Principal.  (a)  Unless
and until an Event of Default has occurred and is continuing, and the Control
Party delivers to the Collateral Agent a Control Party Notice of Default
suspending National Rural’s rights under this clause:

     

    (i) National
Rural shall be entitled to exercise any and all voting and/or other consensual
rights and powers inuring to an owner of Pledged Securities or any part thereof
provided that
such rights and powers shall not be exercised in any manner inconsistent with
the terms of the Note Purchase Agreement or this Pledge Agreement.

     

    (ii) The
Collateral Agent shall execute and deliver to National Rural, or cause to be
executed and delivered to National Rural, all such proxies, powers of attorney
and other instruments as National Rural may reasonably request for the purpose
of enabling National Rural to exercise the voting and/or consensual rights and
powers it is entitled to exercise pursuant to subparagraph (i)
above.

     

    (iii) National
Rural shall be entitled to receive and retain any and all interest, principal
and other distributions paid on or distributed in respect of the Pledged
Securities; provided that any
non-cash interest, principal or other distributions that would constitute
Pledged Securities if pledged hereunder, and received in exchange for Pledged
Securities or any part thereof pledged hereunder, or in redemption thereof, or
as a result of any merger, consolidation, acquisition or other exchange of
assets to which such issuer of Pledged Securities may be a party or otherwise,
shall be and become part of the Pledged Collateral, and, if received by National

     

    
      
        
        

      

      
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    Rural,
shall not be commingled by National Rural with any of its other funds or
property but shall be held separate and apart therefrom, shall be held in trust
for the benefit of the Collateral Agent and shall be forthwith delivered to the
Collateral Agent in the same form as so received (with any necessary
endorsement).

     

    (b) If an
Event of Default shall have occurred and be continuing, then, to the extent such
rights are suspended by the applicable Control Party Notice of Default, all
rights of National Rural to interest, principal or other distributions that
National Rural is authorized to receive pursuant to paragraph (a)(iii) of
this Section 2.08 shall cease, and all such suspended rights shall
thereupon become vested in the Collateral Agent, which shall have the sole and
exclusive right and authority to receive and retain such interest, principal or
other distributions.  All interest, principal or other distributions
received by National Rural contrary to the provisions of this Section 2.08
shall be held in trust for the benefit of the Collateral Agent, shall be
segregated from other property or funds of National Rural and shall be forthwith
delivered to the Collateral Agent in the same form as so received (with any
necessary endorsement).  Any and all money and other property paid
over to or received by the Collateral Agent pursuant to the provisions of this
paragraph (b) shall be retained by the Collateral Agent in an account to be
established by the Collateral Agent upon receipt of such money or other property
and shall be applied in accordance with the provisions of Section 4.03 to
the fullest extent permitted by applicable law.  After all Events of
Default have ceased, the Collateral Agent shall promptly repay to National Rural
(without interest) all interest, principal or other distributions that National
Rural would otherwise be permitted to retain pursuant to the terms of paragraph
(a)(iii) of this Section 2.08 and that remain in such account.

     

    (c) If an
Event of Default shall have occurred and be continuing, then, to the extent such
rights are suspended by the applicable Control Party Notice of Default, all
rights of National Rural to exercise the voting and consensual rights and powers
it is entitled to exercise pursuant to paragraph (a)(i) of this
Section 2.08, and the obligations of the Collateral Agent under
paragraph (a)(ii) of this Section 2.08, shall cease, and all such
rights shall thereupon become vested in the Collateral Agent, which shall have
the sole and exclusive right and authority to exercise such voting and
consensual rights and powers; provided that the
Collateral Agent shall have the right from time to time during the existence of
such Event of Default to permit National Rural to exercise such rights and
powers.

     

    SECTION
2.09. Protection of Title; Payment
of Taxes; Liens, etc.  National Rural will:

     

    (i) duly and
promptly pay and discharge, or cause to be paid and discharged, before they
become delinquent, all taxes, assessments, governmental and other charges
lawfully levied, assessed or imposed upon or against any of the Pledged
Collateral, including the income or profits therefrom and the interests of the
Collateral Agent in such Pledged Collateral;

     

    
      
        
        

      

      
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    (ii) duly
observe and conform to all valid requirements of any governmental authority
imposed upon National Rural relative to any of the Pledged Collateral, and all
covenants, terms and conditions under or upon which any part thereof is
held;

     

    (iii) cause to
be paid and discharged all lawful claims (including, without limitation, income
taxes) which, if unpaid, might become a lien or charge upon Pledged Collateral;
and

     

    (iv) do all
things and take all actions necessary to keep the Lien of this Pledge Agreement
a first and prior lien upon the Pledged Collateral and protect its title to the
Pledged Collateral against loss by reason of any foreclosure or other proceeding
to enforce any lien prior to or pari passu with the Lien
of this Pledge Agreement.

     

    Nothing
contained in this Section shall require the payment of any such tax,
assessment, claim, lien or charge or the compliance with any such requirement so
long as the validity, application or amount thereof shall be contested in good
faith; provided, however, that
National Rural shall have set aside on its books such reserves (segregated to
the extent required by generally accepted accounting principles) as shall be
deemed adequate with respect thereto as determined by the Board of Directors of
National Rural (or a committee thereof).

     

    SECTION
2.10. Maintenance of Pledged
Collateral.  National Rural shall cause the Allowable Amount of
Pledged Collateral held by the Collateral Agent at all times to be not less than
100% of the aggregate principal amount of the Notes outstanding.

     

    SECTION
2.11. Representations, Warranties
and Covenants.  National Rural represents, warrants and
covenants to the Collateral Agent, for the benefit of the Control Party, that
from the time that Pledged Collateral is pledged hereunder, and for so long as
such Pledged Collateral is required to remain pledged:

     

    (a) except
for the Lien hereof and any Lien consented to in writing by Farmer Mac or the
Control Party, National Rural (i) is and will continue to be the direct
owner, beneficially and of record, of the Pledged Securities from time to time
pledged hereunder, (ii) holds and will continue to hold the same free and
clear of all Liens, other than Liens created by this Pledge Agreement,
(iii) will make no assignment, pledge, hypothecation or transfer of, or
create or permit to exist any security interest in or other Lien on, the Pledged
Collateral, other than Liens created by this Pledge Agreement and (iv) will
defend its title or interest thereto or therein against any and all Liens (other
than the Lien created by this Pledge Agreement), however arising, of all Persons
whomsoever;

     

    (b) except
for restrictions and limitations imposed by the Note Purchase Agreement or
securities laws generally, the Pledged Securities are and will continue to be
freely transferable and assignable, and none of the Pledged 

     

    
      
        
        

      

      
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    Securities
are or will be subject to any restriction of any nature that might prohibit,
impair, delay or otherwise affect the pledge of such Pledged Securities
hereunder, the sale or disposition thereof pursuant hereto or the exercise by
the Collateral Agent of rights and remedies hereunder;

     

    (c) National
Rural has the power and authority to pledge the Pledged Collateral pledged by it
hereunder in the manner hereby done or contemplated;

     

    (d) no
consent or approval of any governmental authority, any securities exchange or
any other Person was or is necessary to the validity of the pledge effected
hereby (other than such as have been obtained and are in full force and effect);
and

     

    (e) by virtue
of the execution and delivery by National Rural of this Pledge Agreement, when
any Pledged Securities are delivered to the Collateral Agent in accordance with
this Pledge Agreement, the Collateral Agent will obtain a legal and valid Lien
upon and security interest in such Pledged Securities as security for the
payment and performance of the Obligations.

     

    SECTION
2.12. Further
Assurances.  National Rural will execute and deliver, or cause
to be executed and delivered, all such additional instruments and do, or cause
to be done, all such additional acts as (a) may be necessary or proper,
consistent with the Granting Clause hereof, to carry out the purposes of this
Pledge Agreement and to make subject to the Lien hereof any property intended so
to be subject or (b) may be necessary or proper to transfer to any
successor the estate, powers, instruments and funds held hereunder and to
confirm the Lien of this Pledge Agreement.  National Rural will also
cause to be filed, registered or recorded any instruments of conveyance,
transfer, assignment or further assurance in all offices in which such filing,
registering or recording is necessary to the validity thereof or to give notice
thereof.

     

    ARTICLE
III

     

    [Reserved]

     

     

    ARTICLE
IV

     

    Remedies

     

    SECTION
4.01. Events of
Default.  “Event of Default”,
wherever used herein, means any “Event of Default” as defined in
Section 7.01(a) of the Note Purchase Agreement, provided that, for
the purposes of this Pledge Agreement:

     

    (a) the
Collateral Agent shall not be required to recognize that an Event of Default
exists before such time as the Collateral Agent receives a Control Party Notice
or National Rural Notice stating that an Event of Default exists and specifying
the particulars of such default in reasonable detail; and

     

    
      
        
        

      

      
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    (b) the
Collateral Agent shall not be required to recognize that an Event of Default has
ceased until (i) such time as the Collateral Agent receives a Control Party
Notice stipulating that such event has ceased to exist; or (ii) 30 days after
receipt by the Collateral Agent of a National Rural Notice stipulating that such
event has ceased to exist, provided that the
Collateral Agent does not receive a Control Party Notice within such timeframe
disputing the cessation of such Event of Default, and further provided that
no additional Control Party Notice of Default shall have been received in
respect of any other subsisting Event(s) of Default.  Upon receipt of
any National Rural Notice under subparagraph (ii) of this Subsection, the
Collateral Agent shall provide a copy of such National Rural Notice to the
Control Party.

     

    SECTION
4.02. Remedies upon
Default.  If an Event of Default shall have occurred and be
continuing, the Control Party may issue a notice (a “Control Party Notice of
Default”), which may be combined with the notice provided under
Section 4.01(b), suspending the rights of National Rural under
Section 2.08 in part without suspending all such rights (as specified by
the Control Party in its sole and absolute discretion) without waiving or
otherwise affecting the Control Party’s rights to give additional Control Party
Notices of Default from time to time suspending other rights under
Section 2.08 so long as an Event of
Default has occurred and is continuing.  Subject to paragraph (b) of
this Section 4.02, upon cessation of an Event of Default, all rights of
National Rural suspended under the applicable Control Party Notice of Default
shall revest in National Rural.

     

    (a) Upon the
occurrence of an Event of Default, the Collateral Agent shall, for the benefit
and at the direction of the Control Party, have the right to exercise any and
all rights afforded to a secured party under the Uniform Commercial Code or
other applicable law.  Without limiting the generality of the
foregoing, National Rural agrees that the Collateral Agent shall have the right,
but only if so instructed by a the Control Party Order and subject to the
requirements of applicable law and the Collateral Agent’s right (in its sole and
absolute discretion) to receive indemnification or other reasonable assurances
that its costs and expenses in connection therewith will be paid, to sell or
otherwise dispose of all or any part of the Pledged Collateral at a public or
private sale or at any broker’s board or on any securities exchange, for cash,
upon credit or for future delivery as the Collateral Agent shall deem
appropriate.  The Collateral Agent shall be authorized at any such
sale of securities (if it deems it advisable to do so) to restrict the
prospective bidders or purchasers to Persons who will represent and agree that
they are purchasing the Pledged Collateral for their own account for investment
and not with a view to the distribution or sale thereof, and upon consummation
of any such sale the Collateral Agent shall have the right to assign, transfer
and deliver to the purchaser or purchasers thereof the Pledged Collateral so
sold.  Each such purchaser at any sale of Pledged Collateral shall
hold the property sold absolutely, free from any claim or right on the part of
National Rural, and National Rural hereby waives (to the extent permitted by
law) all rights of redemption, stay and appraisal which National Rural now has
or may at any time in the future have under any rule of law or statute now
existing or hereafter enacted.

     

    
      
        
        

      

      
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    (b) The
Collateral Agent shall give National Rural 10 days’ written notice (which
National Rural agrees is reasonable notice within the meaning of
Section 9-611 of the Uniform Commercial Code or its equivalent in other
jurisdictions) of the Collateral Agent’s intention to make any sale of Pledged
Collateral.  Such notice, in the case of a public sale, shall state
the time and place for such sale and, in the case of a sale at a broker’s board
or on a securities exchange, shall state the board or exchange at which such
sale is to be made and the day on which the Collateral, or portion thereof, will
first be offered for sale at such board or exchange.  Any such public
sale shall be held at such time or times within ordinary business hours and at
such place or places as the Collateral Agent may fix and state in the notice (if
any) of such sale.  At any such sale, the Pledged Collateral, or
portion thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Collateral Agent may (in its sole and absolute discretion)
determine.  The Collateral Agent shall not be obligated to make any
sale of any Pledged Collateral if it shall determine not to do so, regardless of
the fact that notice of sale of such Pledged Collateral shall have been
given.  The Collateral Agent may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so
adjourned.  In case any sale of all or any part of the Pledged
Collateral is made on credit or for future delivery, the Pledged Collateral so
sold may be retained by the Collateral Agent until the sale price is paid by the
purchaser or purchasers thereof, but the Collateral Agent shall not incur any
liability in case any such purchaser or purchasers shall fail to take up and pay
for the Pledged Collateral so sold and, in case of any such failure, such
Pledged Collateral may be sold again upon like notice.  At any public
(or, to the extent permitted by law, private) sale made pursuant to this Pledge
Agreement, the Control Party may bid for or purchase, free (to the extent
permitted by law) from any right of redemption, stay, valuation or appraisal on
the part of National Rural (all said rights being also hereby waived and
released to the extent permitted by law), the Pledged Collateral or any part
thereof offered for sale and may make payment on account thereof by using any
claim then due and payable to the Control Party from National Rural as a credit
against the purchase price, and the Control Party may, upon compliance with the
terms of sale, hold, retain and dispose of such property without further
accountability to Pledged Collateral therefor.  For purposes hereof, a
written agreement to purchase the Pledged Collateral or any portion thereof
shall be treated as a sale thereof; the Collateral Agent shall be free to carry
out such sale pursuant to such agreement and National Rural shall not be
entitled to the return of the Pledged Collateral or any portion thereof subject
thereto, notwithstanding the fact that after the Collateral Agent shall have
entered into such an agreement all Events of Default shall have been remedied
and the Obligations paid in full.  As an alternative to exercising the
power of sale herein conferred upon it, the Collateral Agent may proceed by a
suit or suits at law or in equity to foreclose this Pledge Agreement and to sell
the Collateral or any portion thereof pursuant to a judgment or decree of a
court or courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver.  Any sale pursuant to the provisions of this
Section 4.02 shall be deemed to conform to the commercially reasonable
standards as provided in Section 9-610(b) of the Uniform Commercial Code or
its equivalent in other jurisdictions.

     

    
      
        
        

      

      
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    SECTION
4.03. Application of
Proceeds.  The Collateral Agent shall apply the proceeds of any
collection or sale of Pledged Collateral, including any Pledged Collateral
consisting of cash, as follows to the fullest extent permitted by applicable
law:

     

    FIRST, to
the payment of all reasonable costs and expenses incurred by the Collateral
Agent in connection with or reasonably related or reasonably incidental to such
collection or sale or otherwise in connection with or related or incidental to
this Pledge Agreement or any of the Obligations, including all court costs and
the reasonable fees and expenses of its agents and legal counsel, the repayment
of all advances made by the Collateral Agent (in its sole discretion) hereunder
on behalf of National Rural and any other reasonable costs or expenses incurred
in connection with the exercise of any right or remedy hereunder;

     

    SECOND,
to the payment to the Control Party
in full of the Obligations;
such payment to be for an amount certified in a Control Party
Notice delivered to the Collateral Agent as being the amount due and owing to
the Control
Party under the Obligations; and

     

    THIRD, to
National Rural, its successors or assigns, or as a court of competent
jurisdiction may otherwise direct.

     

    Upon any
sale of the Pledged Collateral by the Collateral Agent (including pursuant to a
power of sale granted by statute or under a judicial proceeding), the receipt of
the Collateral Agent or of the officer making the sale shall be a sufficient
discharge to the purchaser or purchasers of the Pledged Collateral so sold and
such purchaser or purchasers shall not be obligated to see to the application of
any part of the purchase money paid over to the Collateral Agent or such officer
or be answerable in any way for the misapplication thereof.

     

    SECTION
4.04. Securities Act.  In
view of the position of National Rural in relation to the Pledged Collateral, or
because of other current or future circumstances, a question may arise under the
Securities Act of 1933, as now or hereafter in effect, or any similar statute
hereafter enacted analogous in purpose or effect (such Act and any such similar
statute as from time to time in effect being called the “Federal Securities
Laws”) with respect to any disposition of the Pledged Collateral
permitted hereunder.  National Rural understands that compliance with
the Federal Securities Laws might very strictly limit the course of conduct of
the Collateral Agent if the Collateral Agent were to attempt to dispose of all
or any part of the Pledged Collateral, and might also limit the extent to which
or the manner in which any subsequent transferee of any Pledged Collateral could
dispose of the same.  Similarly, there may be other legal restrictions
or limitations affecting the Collateral Agent in any attempt to dispose of all
or part of the Pledged Collateral under applicable Blue Sky or other state
securities laws or similar laws analogous in purpose or
effect.  National Rural recognizes that in 

     

    
      
        
        

      

      
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    light of
such restrictions and limitations the Collateral Agent may, with respect to any
sale of the Pledged Collateral, limit the purchasers to those who will agree,
among other things, to acquire such Pledged Collateral for their own account,
for investment, and not with a view to the distribution or resale
thereof.  National Rural acknowledges and agrees that in light of such
restrictions and limitations, the Collateral Agent, in its sole and absolute
discretion (a) may proceed to make such a sale whether or not a
registration statement for the purpose of registering such Pledged Collateral or
part thereof shall have been filed under the Federal Securities Laws and
(b) may approach and negotiate with a single potential purchaser to effect
such sale.  National Rural acknowledges and agrees that any such sale
might result in prices and other terms less favorable to the seller than if such
sale were a public sale without such restrictions.  In the event of
any such sale, the Collateral Agent shall incur no responsibility or liability
for selling all or any part of the Pledged Collateral at a price that the
Collateral Agent, in its sole and absolute discretion, may in good faith deem
reasonable under the circumstances, notwithstanding the possibility that a
substantially higher price might have been realized if the sale were deferred
until after registration as aforesaid or if more than a single purchaser were
approached.  The provisions of this Section 4.04 will apply
notwithstanding the existence of a public or private market upon which the
quotations or sales prices may exceed substantially the price at which the
Collateral Agent sells.

                               

    ARTICLE V 

     

    The Collateral
Agent

     

    SECTION
5.01. Certain Duties and
Responsibilities.  (a)  At all times under this
Pledge Agreement:

     

    (i) the
Collateral Agent undertakes to perform such duties and only such duties as are
specifically set forth in this Pledge Agreement, and no implied covenants or
obligations shall be read into this Pledge Agreement against the Collateral
Agent; and

     

    (ii) in the
absence of bad faith on its part, the Collateral Agent may conclusively rely, as
to the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Collateral Agent and
substantially conforming to the requirements of this Pledge Agreement; but in
the case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Collateral Agent the Collateral
Agent shall be under a duty to examine the same to determine whether or not they
substantially conform to the requirements of this Pledge Agreement.

     

    (b) No
provision of this Pledge Agreement shall be construed to relieve the Collateral
Agent from liability for its own grossly negligent action, its own grossly
negligent failure to act, or its own willful misconduct, except
that:

     

    (i) this
Subsection shall not be construed to limit the effect of Subsection (a) of this
Section;

     

    
      
        
        

      

      
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    (ii) the
Collateral Agent shall not be liable for any error of judgment made in good
faith, unless it shall be proved that the Collateral Agent was grossly negligent
in ascertaining the pertinent facts; and

     

    (iii) no
provision of this Pledge Agreement shall require the Collateral Agent to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

     

    (c) Whether
or not therein expressly so provided, every provision of this Pledge Agreement
relating to the conduct or affecting the liability of or affording protection to
the Collateral Agent shall be subject to the provisions of this
Section.

     

    SECTION
5.02. Certain Rights of Collateral
Agent.  Except as otherwise provided in
Section 5.01:

     

    (a) the
Collateral Agent may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties;

     

    (b) any
request or direction of National Rural mentioned herein shall be sufficiently
evidenced by a National Rural Notice or National Rural Order;

     

    (c) any
request or direction of the Control Party mentioned herein shall be sufficiently
evidenced by a Control Party Notice or Control Party Order;

     

    (d) whenever
in the administration of this Pledge Agreement the Collateral Agent shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Collateral Agent (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers’ Certificate in the case of National Rural, and a
certificate signed by any Vice President of the Control Party in the case of the
Control Party;

     

    (e) the
Collateral Agent may consult with counsel and the advice of such counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;

     

    (f) the
Collateral Agent shall be under no obligation to exercise any of the rights or
powers vested in it by this Pledge Agreement at the request or direction of
either National Rural or the Control Party pursuant to this Pledge Agreement,
unless such party shall have offered to the Collateral Agent reasonable security
or 

     

    
      
        
        

      

      
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    indemnity
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;

     

    (g) the
Collateral Agent shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture or other
paper or document, or to recompute, verify, reclassify or recalculate any
information contained therein, but the Collateral Agent, in its sole and
absolute discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Collateral Agent shall determine
to make such further inquiry or investigation, it shall be entitled to examine
the books, records and premises of National Rural, personally or by agent or
attorney;

     

    (h) the
Collateral Agent may execute any of the powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the
Collateral Agent shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;

     

    (i) unless
explicitly stated herein to the contrary, the Collateral Agent shall have no
duty to inquire as to the performance of National Rural’s covenants
herein.  In addition, the Collateral Agent shall not be deemed to have
knowledge of any Event of Default unless the Collateral Agent has received a
Control Party Notice in accordance with Section 4.01(a), and shall not be
deemed to have knowledge of the cessation of the same until such time as it
receives a National Rural Notice in accordance with Section 4.01(b);
and

     

    (j) unless
explicitly stated herein to the contrary, the Collateral Agent shall have no
obligation to take any action with respect to any Event of Default until it has
received a Control Party Notice applicable to such event in accordance with
Section 4.01(a), and the Collateral Agent shall have no liability for any
action or inaction taken, suffered or omitted in respect of any such event by it
prior to such time as the applicable Control Party Notice is
delivered.  Similarly, the Collateral Agent shall have no obligation
to take any action with respect to the cessation of an Event of Default until it
has received a National Rural Notice applicable to such event in accordance in
accordance with Section 4.01(b), and the Collateral Agent shall have no
liability for any action or inaction taken, suffered or omitted in respect of
any such event by it prior to such time as the applicable National Rural Notice
is delivered.

     

    SECTION
5.03. Money Held by Collateral
Agent.  Money held by the Collateral Agent hereunder need not
be segregated from other funds except to the extent required by
law.  The Collateral Agent shall have no liability to pay interest on
or (except as expressly provided herein) invest any such moneys.

     

    
      
        
        

      

      
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    SECTION
5.04. Compensation and
Reimbursement.  (a)   National Rural
agrees:

     

    (i) to pay to
the Collateral Agent from time to time such reasonable compensation for all
services rendered by it hereunder as shall have been set forth in an agreement
signed by National Rural;

     

    (ii) except as
otherwise expressly provided herein, to reimburse the Collateral Agent upon its
request for all reasonable expenses, out-of-pocket costs, disbursements and
advances incurred or made by the Collateral Agent in accordance with any
provision of this Pledge Agreement (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except to the extent
any such expense, disbursement or advance may be attributable to its gross
negligence or bad faith; and

     

    (iii) to
indemnify the Collateral Agent for, and to defend and hold it harmless against,
any loss, liability or expense incurred without gross negligence or bad faith on
its part, arising out of or in connection with the acceptance or administration
of this Pledge Agreement or the performance of its duties hereunder, including
the costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent such loss, liability or expense may be
attributable to its gross negligence or bad faith; provided, however, that
National Rural shall have no liability under this clause for any settlement of
any litigation or other dispute effected without the prior written consent of
National Rural (such consent not to be unreasonably withheld).

     

    (b) Any such
amounts payable as provided hereunder shall be additional Obligations secured by
the Lien hereof.  The provisions of this Section 5.04 shall
remain operative and in full force and effect regardless of the termination of
this Pledge Agreement or the Note Purchase Agreement, the consummation of the
transactions contemplated hereby, the repayment of any of the Obligations, the
invalidity or unenforceability of any term or provision of this Pledge Agreement
or the Note Purchase Agreement, or any investigation made by or on behalf of the
Collateral Agent or the Control Party.  All amounts due under this
Section 5.04 shall be payable on written demand therefor.

     

    SECTION
5.05. Corporate Collateral Agent
Required; Eligibility.  There shall at all times be a
Collateral Agent hereunder which shall be a corporation or association organized
and doing business under the laws of the United States of America or of any
State, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000, subject to supervision or
examination by Federal or State authority.  If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published.  Neither National

     

    
      
        
        

      

      
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    Rural nor
any Person directly or indirectly controlling, controlled by or under common
control with National Rural shall serve as Collateral Agent
hereunder.  If at any time the Collateral Agent shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

     

    SECTION
5.06. Resignation and Removal;
Appointment of Successor.  (a)  No resignation or
removal of the Collateral Agent and no appointment of a successor Collateral
Agent pursuant to this Article shall become effective until the acceptance of
appointment by the successor Collateral Agent under
Section 5.07.

     

    (b) The
Collateral Agent may resign at any time by giving written notice thereof to
National Rural.  If an instrument of acceptance by a successor
Collateral Agent shall not have been delivered to the Collateral Agent within 30
days after the giving of such notice of resignation, the resigning Collateral
Agent may petition any court of competent jurisdiction for the appointment of a
successor Collateral Agent.

     

    (c) If at any
time:

     

    (i) except if
an Event of Default has occurred and is continuing, National Rural, in its sole
and absolute discretion, elects to remove the Collateral Agent; or

     

    (ii) the
Collateral Agent shall cease to be eligible under Section 5.05 or shall
become incapable of acting or shall be adjudged a bankrupt or insolvent or a
receiver of the Collateral Agent or of its property shall be appointed or any
public officer shall take charge or control of the Collateral Agent or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation,

     

    then, in
any such case, National Rural may remove the Collateral Agent by delivery of a
National Rural Order to that effect.

     

    (d) If the
Collateral Agent shall resign, be removed or become incapable of acting, or if a
vacancy shall occur in the office of Collateral Agent for any cause, National
Rural shall promptly appoint a successor Collateral Agent by delivering a
National Rural Notice to the retiring Collateral Agent, the successor Collateral
Agent and the Control Party to such effect.

     

    SECTION
5.07. Acceptance of Appointment by
Successor.  Every successor Collateral Agent appointed
hereunder shall execute, acknowledge and deliver to National Rural, the Control
Party and to the retiring Collateral Agent an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Collateral
Agent shall become effective and such successor Collateral Agent, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Collateral Agent; but, on request of
National Rural, the Control Party or the successor Collateral Agent, such
retiring Collateral Agent shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Collateral Agent all the
rights, powers and trusts of the retiring Collateral Agent, and shall duly
assign, transfer and deliver to such successor Collateral Agent all property and

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    money
held by such retiring Collateral Agent hereunder, subject nevertheless to its
Lien, if any, provided for in Section 5.04.  Upon request of any
such successor Collateral Agent, National Rural shall execute any and all
instruments for more fully and certainly vesting in and confirming to such
successor Collateral Agent all such rights, powers and trusts.

     

    No
successor Collateral Agent shall accept its appointment unless at the time of
such acceptance such successor Collateral Agent shall be eligible under
Section 5.05 hereof.

     

    SECTION
5.08. Merger, Conversion,
Consolidation or Succession to Business.  Any corporation into
which the Collateral Agent may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Collateral Agent shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Collateral Agent, shall be the successor of the Collateral Agent hereunder,
provided such corporation shall be eligible under Section 5.05 hereof
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.

     

     

    ARTICLE
VI

     

    Miscellaneous

     

    SECTION
6.01. Notices.  All
notices and other communications hereunder to be made to any party shall be in
writing and shall be addressed as specified in Schedule II attached hereto
as appropriate.  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 parties hereto. A properly
addressed notice or other communication shall be deemed to have been delivered
at the time it is sent by facsimile (fax) transmission to the party or parties
to which it is given.

     

    (a) All
National Rural Notices and National Rural Orders delivered to the Collateral
Agent shall be contemporaneously copied to the Control Party by National Rural;
all Control Party Notices and Control Party Orders delivered to the Collateral
Agent shall be contemporaneously copied by Farmer Mac to National Rural; and all
Collateral Agent notices delivered to either National Rural or Farmer Mac shall
be contemporaneously copied to the other such party by the Collateral
Agent.

     

    SECTION
6.02. Waivers;
Amendment.  (a)  No failure or delay by a party in
exercising any right or power hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies of each party hereunder are
cumulative and are not exclusive of any rights or remedies that such party would
otherwise have.  No waiver of any provision of this Pledge Agreement
or consent to any departure by any party therefrom shall in any event be
effective unless 

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    the same
shall be permitted by paragraph (b) of this Section 6.02, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given.  No notice or demand on any party in any
case shall entitle any party to any other or further notice or demand in similar
or other circumstances.

     

    (b) Neither
this Pledge Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by National Rural, the Collateral Agent, the Purchaser and Farmer
Mac.

     

    SECTION
6.03. Successors and
Assigns.  Whenever in this Pledge Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the successors
and assigns of such party; and all covenants, promises and agreements by or on
behalf of National Rural, the Collateral Agent, the Purchaser, the Control Party
or Farmer Mac that are contained in this Pledge Agreement shall bind and inure
to the benefit of their respective successors and assigns.

     

    SECTION
6.04. Counterparts;
Effectiveness.  This Pledge Agreement may be executed in
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute a single contract.  Delivery of an
executed signature page to this Pledge Agreement by facsimile transmission shall
be as effective as delivery of a manually signed counterpart of this Pledge
Agreement.

     

    SECTION
6.05. Severability.  Any
provision of this Pledge Agreement held to be invalid, illegal or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.  The parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

     

    SECTION
6.06. GOVERNING
LAW.  THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE UNITED STATES OF AMERICA, TO
THE EXTENT APPLICABLE, AND OTHERWISE THE LAWS OF THE STATE OF NEW
YORK.

     

    SECTION
6.07. WAIVER OF JURY
TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
PLEDGE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF 

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE
OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS PLEDGE AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
6.07.

     

    SECTION
6.08. Headings.  Article
and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Pledge Agreement and are not
to affect the construction of, or to be taken into consideration in
interpreting, this Pledge Agreement.

     

    SECTION
6.09. Security Interest
Absolute.  All rights of the Collateral Agent and/or the
Control Party hereunder, the grant of a security interest in the Pledged
Collateral and all obligations of National Rural hereunder shall be absolute and
unconditional irrespective of (a) any lack of validity or enforceability of
the Note Purchase Agreement, any Note, any agreement with respect to any of the
Obligations or any other agreement or instrument relating to any of the
foregoing, (b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from the Note Purchase Agreement, any
Note or any other agreement or instrument, (c) any exchange, release or
non-perfection of any Lien on other collateral, or any release or amendment or
waiver of or consent under or departure from any guarantee, securing or
guaranteeing all or any of the Obligations, or (d) any other circumstance
that might otherwise constitute a defense available to, or a discharge of,
National Rural in respect of the Obligations or this Pledge
Agreement.

     

    SECTION
6.10. Termination or
Release.  (a)  This Pledge Agreement shall terminate
on the date when the Obligations have been indefeasibly paid in full, and at
such time the Lien hereof shall be released.

     

    (b) Upon any
withdrawal, substitution or other disposal by National Rural of any Pledged
Collateral that is permitted by the terms of this Pledge Agreement, or upon the
effectiveness of any written consent to the release of the security interest
granted hereby in any Pledged Collateral, the Lien hereof securing such Pledged
Collateral shall be automatically released.

     

    (c) In
connection with any termination or release pursuant to paragraph (a) or (b)
the Collateral Agent shall deliver to National Rural the Pledged Collateral and
shall execute and deliver to National Rural, at National Rural’s expense, all
documents that National Rural shall reasonably request to evidence such
termination or release.  Any execution and delivery of documents
pursuant to this Section 6.10 shall be without recourse to or warranty by
the Collateral Agent.

     

    SECTION
6.11. Collateral Agent Appointed
Attorney-in-Fact.  National Rural hereby appoints the
Collateral Agent the attorney-in-fact of National Rural for the purpose of, upon
the occurrence and during the continuance of an Event of Default, carrying out
the provisions of this Pledge Agreement with respect to the Pledged

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    Collateral
and taking any action and executing any instrument that the Collateral Agent may
deem necessary or advisable to accomplish the purposes hereof, which appointment
is irrevocable and coupled with an interest but is subject nevertheless to the
terms and conditions of this Pledge Agreement.  Without limiting the
generality of the foregoing, the Collateral Agent shall have the right, upon the
occurrence and during the continuance of an Event of Default, with full power of
substitution either in the Collateral Agent’s name or in the name of National
Rural (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Pledged Collateral or any part thereof; (b) to demand, collect,
receive payment of, give receipt for and give discharges and releases of all or
any of the Pledged Collateral; (c) to commence and prosecute any and all
suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Pledged
Collateral or to enforce any rights in respect of any Pledged Collateral;
(d) to settle, compromise, compound, adjust or defend any actions, suits or
proceedings relating to all or any of the Pledged Collateral; (e) to
notify, or to require National Rural to notify, obligors under Pledged
Securities to make payment directly to the Collateral Agent; and
(f) subject to the second sentence of Section 4.02(a), to use, sell,
assign, transfer, pledge, make any agreement with respect to or otherwise deal
with all or any of the Pledged Collateral, and to do all other acts and things
necessary to carry out the purposes of this Pledge Agreement, as fully and
completely as though the Collateral Agent were the absolute owner of the Pledged
Collateral for all purposes; provided that nothing
herein contained shall be construed as requiring or obligating the Collateral
Agent to make any commitment or to make any inquiry as to the nature or
sufficiency of any payment received by the Collateral Agent, or to present or
file any claim or notice, or to take any action with respect to the Pledged
Collateral or any part thereof or the moneys due or to become due in respect
thereof or any property covered thereby.  The Collateral Agent and the
Control Party shall be accountable only for amounts actually received as a
result of the exercise of the powers granted to them herein, and neither they
nor their officers, directors, employees or agents shall be responsible to
National Rural for any act or failure to act hereunder, except for their own
gross negligence or willful misconduct.

     

    [SIGNATURE
PAGE FOLLOWS]

     

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be duly
executed, all as of the day and year first above written.

     

    
      
        
          	
                  FARMER
      MAC MORTGAGE

                  SECURITIES
      CORPORATION,

                
	
                  by

                
	 
      	/s/
      TOM D. STENDSON  
	 
      	
                  Name:
      Tom D. Stenson

                
	 
      	
                  Title:
      Vice President

                

        

      

    

     

     

    
      
        	
                FEDERAL
      AGRICULTURAL

                MORTGAGE
      CORPORATION,

              
	
                by

              
	 
      	/s/ MICHAEL
      A. GERBER  
	 
      	
                Name:
      Michael A. Gerber    

              
	 
      	
                Title:
      Acting President and CEO

              

      

    

     

    
      

      
        
          	
                  NATIONAL
      RURAL UTILITIES COOPERATIVE FINANCE CORPORATION,

                
	
                  By

                
	 
      	 
      
	 
      	
                  Name:

                
	 
      	
                  Title:

                

        

      

      

      

      
        
          	
                  U.S.
      BANK NATIONAL ASSOCIATION,

                
	
                  By

                
	 
      	 
      
	 
      	
                  Name:                        

                
	 
      	
                  Title:             

                

        

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

      

       

      IN
WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be duly
executed, all as of the day and year first above written.

       

      
        
          
            	
                    FARMER
      MAC MORTGAGE

                    SECURITIES
      CORPORATION,

                  
	
                    by

                  
	 
      	 
	 
      	
                    Name:
      

                  
	 
      	
                    Title:
      

                  

          

        

      

       

       

      
        
          	
                  FEDERAL
      AGRICULTURAL

                  MORTGAGE
      CORPORATION,

                
	
                  by

                
	 
      	 
      
	 
      	
                  Name:     

                
	 
      	
                  Title:
      

                

        

      

       

      
        

        
          
            	
                    NATIONAL
      RURAL UTILITIES COOPERATIVE FINANCE CORPORATION,

                  
	
                    By

                  
	 
      	/s/
      JOHN J. LIST  
	 
      	
                    Name:
      John J. List

                  
	 
      	
                    Title:
      Senior Vice President

                  

          

        

        

        

        
          
            	
                    U.S.
      BANK NATIONAL ASSOCIATION,

                  
	
                    By

                  
	 
      	 
      
	 
      	
                    Name:                        

                  
	 
      	
                    Title:             

                  

          

        

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
       

      IN
WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be duly
executed, all as of the day and year first above written.

       

      
        
          
            	
                    FARMER
      MAC MORTGAGE

                    SECURITIES
      CORPORATION,

                  
	
                    by

                  
	 
      	 
	 
      	
                    Name:
      

                  
	 
      	
                    Title:
      

                  

          

        

      

       

       

      
        
          	
                  FEDERAL
      AGRICULTURAL

                  MORTGAGE
      CORPORATION,

                
	
                  by

                
	 
      	 
      
	 
      	
                  Name:     

                
	 
      	
                  Title:
      

                

        

      

       

      
        

        
          
            	
                    NATIONAL
      RURAL UTILITIES COOPERATIVE FINANCE CORPORATION,

                  
	
                    By

                  
	 
      	 
	 
      	
                    Name:
      

                  
	 
      	
                    Title:
      

                  

          

        

         

         

        
          
            
              	
                      U.S.
      BANK NATIONAL ASSOCIATION,

                    
	
                      By

                    
	 
      	/s/
      THOMAS E. TABOR
	 
      	
                      Name: Thomas
      E. Tabor                       

                    
	 
      	
                      Title: Vice
      President            

                    

            

          

        

        
 

      

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            SCHEDULE
I 

            TO

            PLEDGE
AGREEMENT

          

        

      

    

    
 

    ADDITIONAL
CRITERIA FOR ELIGIBLE SECURITIES1

    

    Criteria for Eligible
Security of Class A Eligible Member:  Each Class A Eligible
Member must satisfy the following criteria only on the date of the pledge of
such Eligible Security:

    

    
      	
              ·  

            	
              Long-Term
      Debt to Net Utility Plant Ratio, as the average ratio of the most recent
      three full calendar years for which financial information is available,
      does not exceed 90%.

            

    

    

    
      	
              ·  

            	
              Modified
      Debt Service Coverage Ratio--Distribution, as the average ratio of the
      most recent three full calendar years for which financial information is
      available, is greater than or equal to
1.35.

            

    

    

    
      	
              ·  

            	
              Equity
      to Total Assets Ratio, as the average ratio of the most recent three full
      calendar years for which financial information is available, is greater
      than or equal to 20%.

            

    

    

    
      	
              ·  

            	
              The
      Eligible Security has a Facility Rating by National Rural of “4.9” or
      lower.

            

    

    

    Criteria for Eligible
Security of Class B Eligible Member:  Each Class B Eligible
Member must satisfy the following criteria only on the date of the pledge of
such Eligible Security:

    

    
      	
              ·  

            	
              Equity
      to Total Capitalization Ratio, as the average ratio of the most recent
      three full calendar years for which financial information is available, is
      greater than or equal to 25%.

            

    

    

    
      	
              ·  

            	
              Modified
      Debt Service Coverage Ratio--G&T, as the average ratio of the most
      recent three full calendar years for which financial information is
      available, is greater than or equal to
1.10.

            

    

    

    
      	
              ·  

            	
              Equity
      to Total Assets Ratio, as the average ratio of the most recent three full
      calendar years for which financial information is available, is greater
      than or equal to 10%.

            

    

    

    
      	
              ·  

            	
              The
      Eligible Security has a Facility Rating by National Rural of “4.9” or
      lower.

            

    

    

      

    

    1The
criteria set forth on this Schedule I shall be required to be satisfied only as
of the date of pledge of (1) any Pledged Securities that is being pledged for a
new advance or (2) any Pledged Securities that is being pledged for an existing
advance which is in substitution of, or in addition to, existing collateral, and
such criteria shall not be required to be satisfied with respect to Eligible
Securities after such date.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            SCHEDULE
II 

            TO

            PLEDGE
AGREEMENT

          

        

      

       

    

    Addresses for
Notices

     

    
      	
              7.  

            	
              The
      addresses referred to in Section 6.01 hereof, for purposes of
      delivering communications and notices, are as
  follows:

            

    

     

    If to the
Purchaser or Farmer Mac:

     

    Federal Agricultural Mortgage
Corporation

    1133 21st Street
N.W., Suite 600

    Washington, DC 20036

    Fax:  202-872-7713

    Attention: Timothy L. Buzby, Vice
President/Controller

    

    If to
Farmer Mac:

     

    Federal
Agricultural Mortgage Corporation

    1133 21st
Street, N.W., Suite 600

    Washington,
DC 20036

    Fax:  202-872-7713

    Attention
of: Timothy L. Buzby, Vice President/Controller

     

    With a
copy to:

     

    Federal
Agricultural Mortgage Corporation

    1133 21st
Street, N.W., Suite 600

    Washington,
DC 20036

    Fax:  202-872-7713

    Attention
of: Jerome G. Oslick, Vice President - General Counsel

     

    If to
National Rural:

     

    National
Rural Utilities Cooperative Finance Corporation

    2201
Cooperative Way

    Herndon,
VA 20171-3025

    Telephone:  703-709-6718

    Fax:  703-709-6779

    Attention
of: Steven L. Lilly, Senior Vice President &

    Chief
Financial Officer

     

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            SCHEDULE
II 

            TO

            PLEDGE
AGREEMENT

          

        

      

    

     

    With a
copy to:

    

    National
Rural Utilities Cooperative Finance Corporation

    2201
Cooperative Way

    Herndon,
VA 20171-3025

    Telephone:  703-709-6712

    Fax:  703-709-6811

    Attention
of: John J. List, Esq., Senior Vice President &

       General
Counsel

    If to the
Collateral Agent:

     

    U.S. Bank
National Association

    100 Wall
Street

    Suite
1600

    New York,
NY 10005-3701

    Telephone:  (212)
361-2893

    Fax:  (212)
509-3384

    Attention
of: Beverly A. Freeney

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
          ANNEX
A 

          TO

          PLEDGE
AGREEMENT

        

      

    

    

    

    NATIONAL
RURAL UTILITIES

    COOPERATIVE
FINANCE CORPORATION

     

    PLEDGE
AGREEMENT DATED AS OF FEBRUARY 5, 2009

     

    CERTIFICATE
OF PLEDGED COLLATERAL FILED WITH

    U.S. BANK
NATIONAL ASSOCIATION, Collateral Agent

     

    ________________,
Chief Executive Officer (or Chief Financial Officer) and ____________________,
Vice-President, respectively, of National Rural Utilities Cooperative Finance
Corporation, hereby certify to the Control Party and the Collateral Agent under
the above-mentioned Pledge Agreement as amended to the date hereof (herein
called the “Pledge Agreement”) as follows:

     

    
      
        
          
            	
                    1.

                  	
                    The
      Allowable Amount of Pledged Collateral certified hereby, remaining on
      deposit with the Collateral Agent, as shown on Schedule A
      hereto, is

                  	
                    $

                  
	
                    2.

                  	
                    The
      Allowable Amount of Pledged Collateral certified hereby, being deposited
      as shown on Schedule B
      hereto, is

                  	
                    $

                  
	
                    3.

                  	
                    The
      aggregate principal amount of the Note(s) outstanding at the date hereof
      is

                  	
                    $

                  
	
                    4.

                  	
                    The
      aggregate amount, if any, of the Note(s) to be issued on the basis of this
      Certificate is

                  	
                    $

                  
	
                    5.

                  	
                    The
      sum of amounts in items 3 and 4 is

                  	
                    $

                  
	
                    6.

                  	
                    The
      aggregate amount by which the Allowable Amount of Pledged Collateral
      exceeds the aggregate principal amount of the Note(s) outstanding (item 1
      plus 2 and minus 5) is

                  	
                    $

                  
	
                    7.

                  	
                    The
      Allowable Amount of Pledged Collateral which is included in items 1
      and  2 above from Class B Eligible Members does not constitute
      more than 20% of the aggregate amount of any notes or bonds: (1) pledged
      hereunder; (2) pledged to secure any other notes or bonds issued by
      National Rural or any affiliate to Farmer Mac or any affiliate; (3) sold
      by National Rural or any affiliate to Farmer Mac or any affiliate; or (4)
      sold to any trust whose beneficial ownership is owned or controlled by
      Farmer Mac or an affiliate.

                  	 
      

          

        

      

    

     

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            ANNEX
A 

            TO

            PLEDGE
AGREEMENT

          

        

      

    

     

     

    
      
        	
                8.

              	
                To
      the knowledge of the undersigned, each Eligible Security from Class A
      Eligible Member the Allowable Amount of which is included in item 2
      satisfies the following criteria on the date of this
      Certificate:  (1) Long-Term Debt to Net Utility Plant Ratio, as
      the average ratio of the most recent three full calendar years for which
      financial information is available, does not exceed 90%; (2) Modified Debt
      Service Coverage Ratio--Distribution, as the average ratio of the most
      recent three full calendar years for which financial information is
      available, is greater than or equal to 1.35; (3) Equity to Total Assets
      Ratio, as the average ratio of the most recent three full calendar years
      for which financial information is available, is greater than or equal to
      20%; and (4) the Eligible Security has a Facility Rating by National Rural
      of “4.9” or lower.

                 

              	 
      
	
                9.

              	
                To
      the knowledge of the undersigned, each Eligible Security from Class B
      Eligible Member the Allowable Amount of which is included in item 2
      satisfies the following criteria on the date of this
      Certificate:  (1) Equity to Total Capitalization Ratio, as the
      average ratio of the most recent three full calendar years for which
      financial information is available, is greater than or equal to 25%; (2)
      Modified Debt Service Coverage Ratio--G&T, as the average ratio of the
      most recent three full calendar years for which financial information is
      available, is greater than or equal to 1.10; (3) Equity to Total Assets
      Ratio, as the average ratio of the most recent three full calendar years
      for which financial information is available, is greater than or equal to
      10%; and (4) the Eligible Security has a Facility Rating by National Rural
      of “4.9” or lower.

                 

              	 
      
	
                10.

              	
                So
      far as is known to the undersigned, no Event of Default
      exists.

              	 
      

      

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
          ANNEX
A 

          TO

          PLEDGE
AGREEMENT

        

      

    

     

    All terms
which are defined in the Pledge Agreement are used herein as so
defined.

     

    

     

    Dated:  _____________________

     

     

    

     

    
      
        
          
            
              	 
      
	 
      
	
                      OF
      NATIONAL RURAL UTILITIES

                      COOPERATIVE
      FINANCE
CORPORATION

                    

            

          

        

      

    

    

    
       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            ANNEX
A 

            TO

            PLEDGE
AGREEMENT

          

        

      

    

     

    PLEDGED
SECURITIES ON DEPOSIT

     

    SCHEDULE
A TO OFFICERS’ CERTIFICATE

     

    DATED

     

    

    
      	
              
                Eligible
      Securities

                 

              

            	
              
                Name
      of Issuer

                 

              

            	
              
                Allowable
      Amount (Item 1)

                 

              

            
	
              Pledged
      Securities

              (Here
      List Securities)

            	 
      	 
      

    

    
      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
            ANNEX
A 

            TO

            PLEDGE
AGREEMENT

          

      

    

    

    PLEDGED
SECURITIES BEING DEPOSITED

     

    SCHEDULE
B TO OFFICERS’ CERTIFICATE

     

    DATED

     

    

    
      	
              
                Eligible
      Securities

                 

              

            	
              
                Name
      of Issuer

                 

              

            	
              
                Allowable
      Amount (Item 2)

                 

              

            
	
              Pledged
      Securities

              (Here
      List Securities)revolving_credit-agrmt.htm

    
      Executed
Version

      

      REVOLVING
CREDIT AGREEMENT

      

      dated as
of

      

      March 13,
2009

      

      among

      

      NATIONAL
RURAL UTILITIES

      COOPERATIVE
FINANCE CORPORATION,

      

      THE BANKS
LISTED HEREIN,

      

      THE BANK
OF NOVA SCOTIA,

      as
Administrative Agent,

      

      THE ROYAL
BANK OF SCOTLAND PLC,

      as
Syndication Agent,

      

      and

      

      DEUTSCHE
BANK SECURITIES INC.,

      

      UBS LOAN
FINANCE LLC

      

      and

      

      THE BANK
OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH,

      as
Co-Documentation Agents

      _________________________

      

      THE BANK
OF NOVA SCOTIA

      

      and

      

      GREENWICH
CAPITAL MARKETS, INC.

      D/B/A RBS
GREENWICH CAPITAL,

      as
Co-Lead Arrangers and Joint Bookrunners

      

      
        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

                                            TABLE
OF CONTENTS

       

      
        
          
            	 
      	 
      
	 
      	
                    Page

                  
	
                    ARTICLE
      1

                  	 
      
	
                    DEFINITIONS

                  	 
      
	
                    Section
      1.01.  Definitions

                  	
                    1

                  
	
                    Section
      1.02.  Accounting Terms and
      Determinations

                  	
                    14

                  
	
                    Section
      1.03.  Types
      of Borrowings

                  	
                    14

                  
	 
      	 
      
	 
      	 
      
	
                    ARTICLE
      2

                  	 
      
	
                    THE
      CREDITS

                  	 
      
	 
      	 
      
	
                    Section
      2.01.  Commitments to
      Lend

                  	
                    14

                  
	
                    Section
      2.02.  Notice
      of Committed Borrowings

                  	
                    15

                  
	
                    Section
      2.03.  Money
      Market Borrowings

                  	
                    15

                  
	
                    Section
      2.04.  Notice
      to Banks; Funding of Loans

                  	
                    19

                  
	
                    Section
      2.05.  Notes

                  	
                    20

                  
	
                    Section
      2.06.  Maturity of
      Loans

                  	
                    21

                  
	
                    Section
      2.07.  Interest
      Rates

                  	
                    21

                  
	
                    Section
      2.08.  Method
      of Electing Interest Rates

                  	
                    23

                  
	
                    Section
      2.09.  Fees

                  	
                    24

                  
	
                    Section
      2.10.  Optional Termination or
      Reduction of Commitments

                  	
                    25

                  
	
                    Section
      2.11.  Mandatory Termination of
      Commitments

                  	
                    25

                  
	
                    Section
      2.12.  Optional Prepayments
      

                  	
                    25

                  
	
                    Section
      2.13.  General
      Provisions as to Payments

                  	
                    25

                  
	
                    Section
      2.14.  Funding
      Losses

                  	
                    26

                  
	
                    Section
      2.15.  Computation of Interest and
      Fees

                  	
                    26

                  
	
                    Section
      2.16.  Withholding Tax
      Exemption

                  	
                    26

                  
	
                    Section
      2.17.  Increase of
      Commitments

                  	
                    27

                  
	
                    Section
      2.18.  Replacement of
      Banks

                  	
                    28

                  
	
                    Section
      2.19  Defaulting
      Banks

                  	
                    30

                  
	 
      	 
      
	
                    ARTICLE
      3

                  	 
      
	
                    CONDITIONS

                  	 
      
	 
      	 
      
	
                    Section
      3.01.  Effectiveness

                  	
                    31

                  
	
                    Section
      3.02   Prior Credit
      Agreement

                  	
                    32

                  
	
                    Section
      3.03.  Borrowings

                  	
                    32

                  
	 
      	 
      
	
                    ARTICLE
      4

                  	 
      
	
                    REPRESENTATIONS
      AND WARRANTIES

                  	 
      
	 
      	 
      
	
                    Section
      4.01.  Corporate Existence, Power and
      Authority

                  	
                    33

                  
	
                    Section
      4.02.  Financial
      Statements

                  	
                    34

                  
	
                    Section
      4.03.  Litigation

                  	
                    35

                  

          

        

        

         

        
          
            
            

          

          
            i

            
              

            

          

          
            
            

          

        

        

        
          	
                  Section
      4.04.  Governmental
      Authorizations

                	
                  35

                
	
                  Section
      4.05.  Members’ Subordinated
      Certificates

                	
                  35

                
	
                  Section
      4.06.  No
      Violation of Agreements

                	
                  35

                
	
                  Section
      4.07.  No
      Event of Default under the Indentures

                	
                  36

                
	
                  Section
      4.08.  Compliance with
      ERISA

                	
                  36

                
	
                  Section
      4.09.  Compliance with Other
      Laws

                	
                  36

                
	
                  Section
      4.10.  Tax
      Status

                	
                  37

                
	
                  Section
      4.11.  Investment Company
      Act

                	
                  37

                
	
                  Section
      4.12.  Disclosure

                	
                  37

                
	
                  Section
      4.13.  Subsidiaries

                	
                  37

                
	
                  Section
      4.14.  Environmental
      Matters

                	
                  37

                
	 
      	 
      
	
                  ARTICLE
      5

                	 
      
	
                  COVENANTS

                	 
      
	 
      	 
      
	
                  Section
      5.01.  Corporate
      Existence

                	
                  38

                
	
                  Section
      5.02.  Disposition of Assets, Merger
      Character of Business, etc

                	
                  38

                
	
                  Section
      5.03.  Financial
      Information

                	
                  38

                
	
                  Section
      5.04.  Default
      Certificates

                	
                  40

                
	
                  Section
      5.05.  Notice
      of Litigation, Legislative Developments and
Defaults

                	
                  41

                
	
                  Section
      5.06.  ERISA

                	
                  42

                
	
                  Section
      5.07.  Payment
      of Charges

                	
                  42

                
	
                  Section
      5.08.  Inspection of Books and
      Assets

                	
                  42

                
	
                  Section
      5.09.  Indebtedness

                	
                  42

                
	
                  Section
      5.10.  Liens

                	
                  43

                
	
                  Section
      5.11.  Maintenance of
      Insurance

                	
                  44

                
	
                  Section
      5.12.  Subsidiaries and Joint
      Ventures

                	
                  44

                
	
                  Section
      5.13.  Minimum
      TIER

                	
                  45

                
	
                  Section
      5.14.  Retirement of Patronage
      Capital

                	
                  46

                
	
                  Section
      5.15.  Use of
      Proceeds

                	
                  46

                
	 
      	 
      
	
                  ARTICLE
      6

                	 
      
	
                  DEFAULTS

                	 
      
	 
      	 
      
	
                  Section
      6.01.  Events
      of Defaults

                	
                  46

                
	
                  Section
      6.02.  Notice
      of Default

                	
                  48

                
	 
      	 
      
	
                  ARTICLE
      7

                	 
      
	
                  THE
      ADMINISTRATIVE AGENT

                	 
      
	 
      	 
      
	
                  Section
      7.01.  Appointment and
      Authorization

                	
                  49

                
	
                  Section
      7.02.  Administrative Agent and
      Affliates

                	
                  49

                
	
                  Section
      7.03.  Action
      by Admininstrative Agent

                	
                  49

                
	
                  Section
      7.04.  Consultation with
      Experts

                	
                  49

                
	
                  Section
      7.05.  Liability of Administrative
      Agent

                	
                  49

                
	
                  Section
      7.06.  Indemnification

                	
                  50

                
	
                  Section
      7.07.  Credit
      Decision

                	
                  50

                
	
                  Section
      7.08.  Successor Admininstrative
      Agent

                	
                  50

                

        

         

        
          
            
            

          

          
            ii

            
              

            

          

          
            
            

          

        

        
 

        
          	
                  Section
      7.09.  Co-Documentation Agents And
      Syndication Agent Not Liable

                	
                  50

                
	 
      	 
      
	
                  ARTICLE
      8

                	 
      
	
                  CHANGE
      IN CIRCUMSTANCES

                	 
      
	 
      	 
      
	
                  Section
      8.01.  Basis
      for Determininig Interest Rate Inadequate of Unfair

                	
                  51

                
	
                  Section
      8.02  Illegality

                	
                  51

                
	
                  Section
      8.03  Increased Cost and Reduced Return

                	
                  52

                
	
                  Section
      8.04  Base Rate Loans Substituted for Affected Euro-Dollar
      Loans

                	
                  54

                
	 
      	 
      
	
                  ARTICLE
      9

                	 
      
	
                  MISCELLANEOUS

                	 
      
	 
      	 
      
	
                  Section
      9.01.  Notices

                	
                  54

                
	
                  Section
      9.02.  No
      Waivers

                	
                  55

                
	
                  Section
      9.03.  Expenses; Documentary Taxes;
      Indemnification

                	
                  55

                
	
                  Section
      9.04.  Sharing
      of Set-offs

                	
                  56

                
	
                  Section
      9.05.  Amendments and
      Waivers

                	
                  56

                
	
                  Section
      9.06.  Successors and
      Assigns

                	
                  57

                
	
                  Section
      9.07.  Collateral

                	
                  59

                
	
                  Section
      9.08.  Governing
      Law

                	
                  59

                
	
                  Section
      9.09.  Counterparts;
      Integration

                	
                  60

                
	
                  Section
      9.10.  Several
      Obligations

                	
                  60

                
	
                  Section
      9.11.  Severability

                	
                  60

                
	
                  Section
      9.12.  Confidentiality

                	
                  60

                
	
                  Section
      9.13.  WAIVER
      OF JURY TRIAL

                	
                  61

                
	
                  Section
      9.14.  USA
      Patriot Act

                	
                  61

                
	
                  Section
      9.15.  ICC
      Transactions

                	
                  61

                
	 
      	 
      
	 
      	 
      

        

        

        
          
            
            

          

          
            iii

            
              

            

          

          
            
            

          

        

        

        

        
          
            
              
                	
                        Schedules

                      	 
      
	 
      	 
      
	
                        Agent
      Schedule

                      	 
      
	
                        Commitment
      Schedule

                      	 
      
	
                        Pricing
      Schedule

                      	 
      
	
                        Schedule
      5.03 (a)

                      	
                        Non-GAAP
      Subsidiaries

                      
	
                        Schedule
      9.15

                      	
                        ICC
      Transactions

                      
	 
      	 
      
	
                        Exhibits

                      	 
      
	 
      	 
      
	
                        Exhibit
      A

                      	
                        -  Form
      of Note

                      
	
                        Exhibit
      B-1 and Exhibit B-2

                      	
                        -  Forms
      of RUS Guarantee

                      
	
                        Exhibit
      C

                      	
                        -  Money
      Market Quote Request

                      
	
                        Exhibit
      D

                      	
                        -  Invitation
      for Money Market Quotes

                      
	
                        Exhibit
      E

                      	
                        -  Money
      Market Quote

                      
	
                        Exhibit
      F

                      	
                        -
      Opinion of General Counsel for the Borrower

                           Annex
      A -  Legal Actions

                           Annex
      B -  Subsidiaries and Joint Ventures

                      
	
                        Exhibit
      G

                      	
                        -  Assignements
      and Assumption
Request

                      

              

            

          

        

        

        
          
            
            

          

          
            iv

            
              

            

          

          
            
            

          

        

      

       

      REVOLVING
CREDIT AGREEMENT

       

      REVOLVING
CREDIT AGREEMENT dated as of March 13, 2009, among NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION, a not-for-profit cooperative association
incorporated under the laws of the District of Columbia, as Borrower, the BANKS
listed on the signature pages hereof, THE BANK OF NOVA SCOTIA, as Administrative
Agent, THE ROYAL BANK OF SCOTLAND PLC, as Syndication Agent, and DEUTSCHE BANK
SECURITIES INC., UBS LOAN FINANCE LLC and THE BANK OF TOKYO-MITSUBISHI UFJ,
LTD., NEW YORK BRANCH, as Co-Documentation Agents.

      

      The
parties hereto agree as follows:

       

      ARTICLE
1

      Definitions

       

      Section
1.01 .  Definitions.  The
following terms, as used herein, have the following meanings:

       

      “1972 Indenture” means the
Seventeenth Supplemental Indenture dated as of March 1, 1987, amending and
restating in full the Indenture dated as of December 1, 1972, by and between the
Borrower and U.S. Bank Trust National Association, as trustee, as amended and
supplemented from time to time, providing for the issuance in series of certain
collateral trust bonds of the Borrower.

       

      “1994 Indenture” means the
Indenture dated as of February 15, 1994 and as amended as of September 16, 1994
between the Borrower and U.S. Bank National Association, as trustee, as amended
and supplemented from time to time, providing for the issuance in series of
certain collateral trust bonds of the Borrower.

       

      “2007 Indenture” means the
Indenture dated as of October 25, 2007 between the Borrower and U.S. Bank
National Association, as trustee, as amended and supplemented from time to time,
providing for the issuance in series of certain collateral trust bonds of the
Borrower.

       

      “Absolute Rate Auction” means a
solicitation of Money Market Quotes setting forth Money Market Absolute Rates
pursuant to Section 2.03.

       

      “Adjusted London Interbank Offered
Rate” has the meaning set forth in Section 2.07(b).

       

      “Administrative Agent” means
The Bank of Nova Scotia, in its capacity as administrative agent for the Banks
hereunder, and its successors in such capacity.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Administrative Questionnaire”
means, with respect to each Bank, the administrative questionnaire in the form
submitted to such Bank by the Administrative Agent and submitted to the
Administrative Agent (with a copy to the Borrower) duly completed by such
Bank.

       

      “Agreement” means this
Revolving Credit Agreement, as the same may be amended from time to
time.

       

      “Applicable Lending Office”
means, with respect to any Bank, (i) in the case of its Base Rate Loans, its
Domestic Lending Office, (ii) in the case of its Euro-Dollar Loans, its
Euro-Dollar Lending Office and (iii) in the case of its Money Market Loans, its
Money Market Lending Office.

       

      “Assignee” has the meaning set
forth in Section 9.06(c).

       

      “Bank” means each bank listed
on the signature pages hereof, each Assignee which becomes a Bank pursuant to
Section 9.06(c), and their respective successors.

       

      “Base Rate” means, for any day,
a rate per annum equal to the highest of (i) the Prime Rate for such day, (ii)
the Federal Funds Rate for such day plus 2% and (iii) the Adjusted London
Interbank Offered Rate for a one month Interest Period on such day (or if such
day is not a Euro-Dollar Domestic Business Day, the immediately preceding
Euro-Dollar Business Day) plus 2%.

       

      “Base Rate Loan” means a
Committed Loan that bears interest at the Base Rate pursuant to the applicable
Notice of Committed Borrowing or Notice of Interest Rate Election or the last
sentence of Section 2.08(a) or Article 8.

       

      “Base Rate Margin” has the
meaning set forth in the Pricing Schedule hereto.

       

      “Bonds” means any bonds issued
pursuant to any of the Indentures, as the context may require.

       

      “Borrower” means the National
Rural Utilities Cooperative Finance Corporation, a not-for-profit cooperative
association incorporated under the laws of the District of Columbia, and its
successors.

       

      “Borrowing” has the meaning set
forth in Section 1.03.

       

      “Co-Documentation Agents” means
Deutsche Bank Securities Inc., UBS Loan Finance LLC and The Bank of
Tokyo-Mitsubishi UFJ, Ltd., New York Branch, each in its capacity as
co-documentation agent hereunder, and their successors in such
capacity.

       

      “Commitment” means (i) with
respect to each Bank listed on the signature pages hereof, the amount set forth
opposite the name of such Bank on the Commitment Schedule hereto and (ii) with
respect to any Assignee that 

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      becomes a
Bank pursuant to Section 9.06(c), the amount of the transferor Bank’s Commitment
assigned to it pursuant to Section 9.06(c), in each case as such amount may from
time to time be reduced pursuant to Sections 2.10 and 2.11; provided that, if the context
so requires, the term “Commitment” means the obligation of a Bank to extend
credit up to such amount to the Borrower hereunder.

       

      “Committed Borrowing” means a
Borrowing under Section 2.01.

       

      “Committed Loan” means a
Revolving Loan; provided that, if any such
loan or loans (or portions thereof) are combined or subdivided pursuant to a
Notice of Interest Rate Election, the term “Committed Loan” shall refer to the
combined principal amount resulting from such combination or to each of the
separate principal amounts resulting from such subdivision, as the case may
be.

       

      “Commitment Termination Date”
means March 12, 2010 or, if such day is not a Euro-Dollar Business Day, the next
preceding Euro-Dollar Business Day.

       

      “Consolidated Subsidiary” means
at any date any Subsidiary and any other entity the accounts of which would be
combined or consolidated with those of the Borrower in its combined or
consolidated financial statements if such statements were prepared as of such
date.

       

      “Consolidated Subsidiary Member” has the
meaning set forth in Section 5.03(b)(iii)(A).

       

      “Default” means any condition
or event which constitutes an Event of Default or which with the giving of
notice or lapse of time or both (as specified in Section 6.01) would, unless
cured or waived, become an Event of Default.

       

      “Defaulting Bank” means any
Bank that, at any time during the term of this Agreement, has (a) failed to fund
any portion of any of its Loans within three Domestic Business Days of the date
required to be funded by it hereunder, (b) notified the Borrower, the
Administrative Agent or any Bank that it does not intend to comply with any of
its funding obligations under this Agreement, (c) otherwise failed to pay
over to the Administrative Agent or any other Bank any other amount required to
be paid by it hereunder within three Domestic Business Days of the date when
due, unless the subject of a good-faith dispute, or (d) become the subject of a
bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee
or custodian appointed for it, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or
appointment; provided
that a Bank shall not be a Defaulting Bank solely by virtue of the ownership or
acquisition of an equity interest in such Bank or its parent company by a
governmental authority or an instrumentality thereof.

       

      “Derivative Cash Settlements” means, for
any period, the line item “derivative cash settlements” as it appears on the
statement of operations of the Borrower and its Consolidated Subsidiaries for
such period delivered to the Banks 

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      pursuant
to Section 5.03(b), calculated in accordance with generally accepted accounting
principles as in effect from time to time.

       

      “Derivatives Obligations” of
any Person means all obligations of such Person in respect of any rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of the foregoing transactions) or any combination
of the foregoing transactions.

       

      “Determination Date” has the
meaning set forth in Section 5.09.

       

      “Domestic Business Day” means
any day except a Saturday, Sunday or other day on which commercial banks in New
York City are authorized or required by law to close.

       

      “Domestic Lending Office”
means, as to each Bank, its office located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative Questionnaire
as its Domestic Lending Office) or such other office as such Bank may hereafter
designate as its Domestic Lending Office by notice to the Borrower and the
Administrative Agent.

       

      “Effective Date” means the date
this Agreement becomes effective in accordance with Section 3.01.

       

      “Environmental Laws” means any
and all federal, state, local and foreign statutes, laws, judicial decisions,
regulations, ordinances, rules, judgments, orders, decrees, plans, injunctions,
permits, concessions, grants, franchises, licenses, agreements and governmental
restrictions relating to the environment, the effect of the environment on human
health or to emissions, discharges or releases of pollutants, contaminants,
Hazardous Substances or wastes into the environment including, without
limitation, ambient air, surface water, ground water, or land, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, Hazardous
Substances or wastes or the clean-up or other remediation thereof.

       

      “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended, or any successor
statute.

       

      “ERISA Group” means the
Borrower, any Subsidiary and all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any Subsidiary, are treated as a single
employer under Section 414(b) or (c) of the Internal Revenue Code or, for
purposes of Section 412 of the Internal Revenue Code, under Section 414(b), (c),
(m) or (o) of the Internal Revenue Code.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      “Euro-Dollar Business Day”
means any Domestic Business Day on which commercial banks are open for
international business (including dealings in dollar deposits) in
London.

       

      “Euro-Dollar Lending Office”
means, as to each Bank, its office, branch or affiliate located at its address
set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Euro-Dollar Lending Office) or such other
office, branch or affiliate of such Bank as it may hereafter designate as its
Euro-Dollar Lending Office by notice to the Borrower and the Administrative
Agent.

       

      “Euro-Dollar Loan” means a
Committed Loan that bears interest at a Euro-Dollar Rate pursuant to the
applicable Notice of Committed Borrowing or Notice of Interest Rate
Election.

       

      “Euro-Dollar Margin” means a
rate per annum determined in accordance with the Pricing Schedule.

       

      “Euro-Dollar Rate” means, for
any day, a rate per annum determined in accordance with Section
2.07(b).

       

      “Euro-Dollar Reference Banks”
means the principal London offices of The Bank of Nova Scotia and The Royal Bank
of Scotland plc.

       

      “Euro-Dollar Reserve
Percentage” has the meaning set forth in Section 2.07(b).

       

      “Event of Default” has the
meaning set forth in Section 6.01.

       

      “Facility Fee Rate” means a
rate per annum determined in accordance with the Pricing Schedule.

       

      “Federal Funds Rate” means, for
any day, the rate per annum (rounded upward, if necessary, to the nearest
1/100th of 1%) equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Domestic Business Day next succeeding such day; provided that (i) if such day
is not a Domestic Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Domestic Business Day as so
published on the next succeeding Domestic Business Day, and (ii) if no such rate
is so published on such next succeeding Domestic Business Day, the Federal Funds
Rate for such day shall be the average rate quoted to The Bank of Nova Scotia on
such day on such transactions as determined by the Administrative
Agent.

       

      “Fixed Rate Borrowing” means
either a Euro-Dollar Borrowing or a  Money Market LIBOR
Borrowing.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      “Fixed Rate Loans” means
Euro-Dollar Loans or Money Market Loans (excluding Money Market LIBOR Loans
bearing interest at the Base Rate pursuant to Section 8.01) or any combination
of the foregoing.

       

      “Foreclosed Asset” has the
meaning set forth in Section 5.12.

       

      “Group of Loans” means, at any
time, a group of Loans consisting of (i) all Committed Loans which are Base Rate
Loans at such time or (ii) all Euro-Dollar Loans having the same Interest Period
at such time; provided
that if a Committed Loan of any particular Bank is converted to or made as a
Base Rate Loan pursuant to Article 8, such Loan shall be included in the same
Group or Groups of Loans from time to time as it would have been in if it had
not been so converted or made.

       

      “Guarantee” by any Person means
any obligation, contingent or otherwise, of such Person directly or indirectly
guaranteeing any Indebtedness or lease payments of any other Person or otherwise
in any manner assuring the holder of any Indebtedness of, or the obligee under
any lease of, any other Person through an agreement, contingent or otherwise, to
purchase Indebtedness or the property subject to such lease, or to purchase
goods, supplies or services primarily for the purpose of enabling the debtor or
obligor to make payment of the Indebtedness or under such lease or of assuring
such Person against loss, or to supply funds to or in any other manner invest in
the debtor or obligor, or otherwise; provided that the term “Guarantee” shall not include
endorsements for collection or deposit in the ordinary course of
business.  The term “Guarantee” when used as a verb
has a correlative meaning.

       

      “Guaranteed Portion” has the
meaning set forth in the definition of RUS Guaranteed Loan.

       

      “Hazardous Substances” means
any toxic, radioactive, caustic or otherwise hazardous substance, including
petroleum, its derivatives, by-products and other hydrocarbons, or any substance
having any constituent elements displaying any of the foregoing
characteristics.

       

      “Increased Amount Date” has the
meaning set forth in Section 2.17.

       

      “Incremental Bank” has the
meaning set forth in Section 2.17.

       

      “Incremental Commitments” has
the meaning set forth in Section 2.17 .

       

       “Indebtedness” with respect to
any Person means:

       

      (1)           all
indebtedness which would appear as indebtedness on a balance sheet of such
Person prepared in accordance with generally accepted accounting principles (i)
for money borrowed, (ii) which is evidenced by securities sold for money or
(iii) which constitutes purchase money indebtedness;

       

      (2)           all
indebtedness of others Guaranteed by such Person;

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      (3)           all
indebtedness secured by any Lien upon property owned by such Person, even though
such Person has not assumed or become liable for the payment of such
indebtedness; and

       

      (4)           all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement (including any lease in the nature of a title
retention agreement) with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession of such property), but only if
such property is included as an asset on the balance sheet of such
Person;

       

      provided that, in computing
the “Indebtedness” of
such Person, there shall be excluded any particular indebtedness if, upon or
prior to the maturity thereof, there shall have been deposited with the proper
depositary in trust money (or evidences of such indebtedness) in the amount
necessary to pay, redeem or satisfy such indebtedness, and thereafter such money
and evidences of indebtedness so deposited shall not be included in any
computation of the assets of such Person; and provided further that no provision of
this definition shall be construed to include as “Indebtedness” of the Borrower
or its Consolidated Subsidiaries any indebtedness by virtue of any agreement by
the Borrower or its Consolidated Subsidiaries to advance or supply funds to
Members or Consolidated Subsidiary Members.

       

      “Indenture” means either the
1972 Indenture, the 1994 Indenture, the 2007 Indenture or any other Indenture
that provides for borrowing on terms not materially more disadvantageous to the
Borrower’s unsecured creditors than the borrowings under the 1972 Indenture, the
1994 Indenture or the 2007 Indenture, and “Indentures” means all such
Indentures.

       

      “Interest Expense” means, for
any period, the line item “interest expense” as it appears on the statement of
operations of the Borrower and its Consolidated Subsidiaries for such period
delivered to the Banks pursuant to Section 5.03(b), calculated in accordance
with generally accepted accounting principles as in effect from time to
time.

       

      “Interest Period” means: (1)
with respect to each Euro-Dollar Borrowing, the period commencing on the date of
such Borrowing and ending one, two, three or six months thereafter, as the
Borrower may elect in the applicable Notice of Borrowing; provided that:

       

      (a)           any
Interest Period which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Euro-Dollar Business
Day;

       

      (b)           any
Interest Period which begins on the last Euro-Dollar Business Day of a calendar
month (or on a day for which there is no numerically 

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      corresponding
day in the calendar month at the end of such Interest Period) shall, subject to
clause (c) below, end on the last Euro-Dollar Business Day of a calendar month;
and

       

      (c)           any
Interest Period of any Euro-Dollar Loan included in such Borrowing which would
otherwise end after the Maturity Date shall, with respect to such Euro-Dollar
Loan, end on such Maturity Date;

       

      (2)           with
respect to each Base Rate Borrowing, the period commencing on the date of such
Borrowing and ending 30 days thereafter; provided that:

       

      (a)           any
Interest Period which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding Euro-Dollar Business Day;
and

       

      (b)           any
Interest Period of any Base Rate Loan included in such Borrowing which would
otherwise end after the Maturity Date shall, with respect to such Base Rate
Loan, end on such Maturity Date;

       

      (3)           with
respect to each Money Market LIBOR Borrowing, the period commencing on the date
of such Borrowing and ending any whole number of months thereafter (but not less
than one month) as the Borrower may elect in the applicable Notice of Borrowing;
provided
that:

       

      (a)           any
Interest Period which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Euro-Dollar Business
Day;

       

      (b)           any
Interest Period which begins on the last Euro-Dollar Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall, subject to clause (c)
below, end on the last Euro-Dollar Business Day of a calendar month;
and

       

      (c)           any
Interest Period which would otherwise end after the Commitment Termination Date
shall end on the Commitment Termination Date; and

       

      (4)           with
respect to each Money Market Absolute Rate Borrowing, the period commencing on
the date of such Borrowing and ending such number of days thereafter (but not
less than 30 days) as the Borrower may elect in the applicable Notice of
Borrowing; provided
that:

       

      (a)           any
Interest Period which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding Euro-Dollar Business Day;
and

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      (b)           any
Interest Period which would otherwise end after the Commitment Termination Date
shall end on the Commitment Termination Date.

       

      “Internal Revenue Code” means
the Internal Revenue Code of 1986, as amended, or any successor
statute.

       

      “Investments” has the meaning
set forth in Section 5.12.

       

      “Joint Venture” means any
corporation, partnership, association, joint venture or other entity in which
the Borrower, directly or indirectly through Subsidiaries or Joint Ventures, has
an equity interest at the time of 10% or more but which is not a Subsidiary;
provided that no Person
whose only assets are RUS Guaranteed Loans and investments incidental thereto
shall be deemed a Joint Venture.

       

      “LIBOR Auction” means a
solicitation of Money Market Quotes setting forth Money Market Margins based on
the London Interbank Offered Rate pursuant to Section 2.03.

       

      “Lien” means, with respect to
any asset, any mortgage, lien, pledge, charge, security interest or encumbrance
of any kind in respect of such asset.  For the purposes of this
Agreement, the Borrower or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.

       

      “Loan” means a Base Rate Loan
or a Euro-Dollar Loan or a Money Market Loan and “Loans” means Base Rate Loans
or Euro-Dollar Loans or Money Market Loans or any combination of the
foregoing.

       

      “London Interbank Offered Rate”
has the meaning set forth in Section 2.07(b).

       

      “Maturity Date” means (i) with
respect to any Revolving Loan, the Commitment Termination Date, and (ii) with
respect to any Money Market Loan, the last day of the Interest Period applicable
thereto.

       

      “Member” means any Person which
is a member or a patron of the Borrower.

       

      “Members’ Subordinated
Certificate” means a note of the Borrower or its Consolidated
Subsidiaries substantially in the form of the membership subordinated
subscription certificates and the loan and guarantee subordinated certificates
outstanding on the date of the execution and delivery of this Agreement and any
other Indebtedness of the Borrower or its Consolidated Subsidiaries having
substantially similar provisions as to subordination as those contained in said
outstanding membership subordinated subscription certificates and loan and
guarantee subordinated certificates.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      “Money Market Absolute Rate”
has the meaning set forth in Section 2.03(d).

       

      “Money Market Absolute Rate
Loan” means a loan to be made by a Bank pursuant to an Absolute Rate
Auction.

       

      “Money Market Lending Office”
means, as to each Bank, its Domestic Lending Office or such other office, branch
or affiliate of such Bank as it may hereafter designate as its Money Market
Lending Office by notice to the Borrower and the Administrative Agent; provided that any Bank may
from time to time by notice to the Borrower and the Administrative Agent
designate separate Money Market Lending Offices for its Money Market LIBOR
Loans, on the one hand, and its Money Market Absolute Rate Loans, on the other
hand, in which case all references herein to the Money Market Lending Office of
such Bank shall be deemed to refer to either or both of such offices, as the
context may require.

       

      “Money Market LIBOR Loan” means
a loan to be made by a Bank pursuant to a LIBOR Auction (including such a loan
bearing interest at the Prime Rate pursuant to Section 8.01(a)).

       

      “Money Market Loan” means a
Money Market LIBOR Loan or a Money Market Absolute Rate Loan.

       

      “Money Market Margin” has the
meaning set forth in Section 2.03(d).

       

      “Money Market Quote” means an
offer by a Bank to make a Money Market Loan in accordance with Section
2.03.

       

      “Moody’s” means Moody’s
Investors Service, Inc., and its successors.

       

      “Multiple Employer Plan” means
a single employer plan, as defined in Section 4001 of ERISA and subject to Title
IV of ERISA, which has two or more contributing sponsors, one of whom is the
Borrower or a Subsidiary of the Borrower or any member of the ERISA Group, at
least two of whom are not under common control, within the meaning of Section
4063 of ERISA.

       

      “Net Income” means, for any
period, the sum of (i) the line item “net income” on the consolidated statement
of operations of the Borrower and its Consolidated Subsidiaries plus (ii) the line item
“minority interest” on the consolidated statement of operations of the Borrower
and its Consolidated Subsidiaries at the last day of such period, each as it
appears in the financial statements for such period delivered to the Banks
pursuant to Section 5.03(b), and each calculated in accordance with generally
accepted accounting principles as in effect from time to time; provided that non-cash
adjustments (whether positive or negative) required to be made pursuant to SFAS
133 and SFAS 52 on each such line item shall be excluded from the calculation
thereof to the extent otherwise included therein.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      “Notes” means promissory notes
of the Borrower, substantially in the form of Exhibit A hereto, evidencing the
obligation of the Borrower to repay the Loans, and “Note” means any one of such
promissory notes issued hereunder.

       

      “Notice of Borrowing” means a
Notice of Committed Borrowing or a Notice of Money Market
Borrowing.

       

      “Notice of Committed Borrowing”
has the meaning set forth in Section 2.02.

       

      “Notice of Interest Rate
Election” has the meaning set forth in Section 2.08.

       

      “Notice of Money Market
Borrowing” has the meaning set forth in Section 2.03(f).

       

      “Participant” has the meaning
set forth in Section 9.06(b).

       

      “Patronage Capital
Certificates” means those certificates that evidence the portion of Net
Income allocated by the Borrower among its Members in accordance with applicable
cooperative principles.

       

      “PBGC” means the Pension
Benefit Guaranty Corporation or any entity succeeding to any or all of its
functions under ERISA.

       

      “Person” means an individual, a
corporation, a partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.

       

      “Plan” means any multiemployer
plan or single employer plan (including any Multiple Employer Plan), as defined
in Section 4001 and subject to Title IV of ERISA, which is maintained or
contributed to by, or at any time during the five calendar years preceding the
date of this Agreement was maintained or contributed to by, the Borrower or a
Subsidiary of the Borrower or any member of the ERISA Group.

       

      “Pricing Schedule” means the
Pricing Schedule attached hereto.

       

      “Prime Rate” means the rate of
interest published by The Wall Street Journal from time
to time as the “Prime Rate” in its printed version or, if The Wall Street Journal
ceases publishing a “Prime Rate”, any successor publication selected by the
Administrative Agent in its reasonable discretion with the consent of the
Borrower; each change in the Prime Rate shall be effective from and including
the date such change is publicly announced as being effective and published in
the printed version of The Wall Street Journal or any
successor publication.

       

      “Prior 364-Day Credit
Agreement” means the Revolving Credit Agreement dated as of March 14,
2008, among the Borrower, the banks named 

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      therein,
Deutsche Bank Securities Inc., UBS Loan Finance LLC and The Bank of Tokyo
Mitsubishi UFJ, Ltd., New York Branch, as Co-Documentation Agents, The Royal
Bank of Scotland plc, as Syndication Agent, and The Bank of Nova Scotia, as
Administrative Agent.

       

       “Qualified Subordinated
Indebtedness” means the Borrower’s (i) 6.75% Subordinated Deferrable
Interest Notes Due 2043, (ii) 6.10% Subordinated Deferrable Interest Notes Due
2044, (iii) 5.95% Subordinated Deferrable Interest Notes Due 2045, and (iv) any
other Indebtedness of the Borrower having substantially similar terms as to
subordination as those contained in the instruments and documents relating to
the foregoing Indebtedness or that would be junior to any of the foregoing;
provided that such
Indebtedness (a) will not mature prior to the Maturity Date and (b) does not
require payments of principal prior to the Maturity Date, except pursuant to
acceleration or at the option of the Borrower.

       

      “REDLG Program Liens” means
Liens on any asset of the Borrower required to be pledged as collateral to
support obligations of the Borrower with respect to any government Guarantee
provided pursuant to regulations issued under the Rural Electrification Act of
1936, 7 U.S.C. 901 et. seq., and the Food, Conservation and Energy Act of 2008,
Pub. L. 110-234 Stat. 923 (“REDLG Obligations”) so long as
such Guarantee supports long-term Indebtedness issued by the Borrower and
permitted by Section 5.09.

       

      “REDLG Obligations” has the
meaning set forth in the definition of REDLG Program Liens.

       

      “Regulation U” means Regulation
U of the Board of Governors of the Federal Reserve System, as in effect from
time to time.

       

      “Regulation X” means Regulation
X of the Board of Governors of the Federal Reserve System, as in effect from
time to time.

       

      “Reportable Event” means an
event described in Section 4043(c) of ERISA or regulations promulgated by the
Department of Labor thereunder (with respect to which the 30 day notice
requirement has not been waived by the PBGC).

       

      “Required Banks” means at any
time Banks having at least 51% of the sum of the aggregate amount of the unused
Commitments and the aggregate principal outstanding amount of the
Loans.

       

      “Revolving Credit Period” means
the period from and including the Effective Date to but excluding the Commitment
Termination Date.

       

      “Revolving Loan” means a loan
made by a Bank pursuant to Section 2.01.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      “RUS” means the Rural Utilities
Service of the Department of Agriculture of the United States of America (as
successor to the Rural Electrification Administration of the Department of
Agriculture of the United States of America) or any other regulatory body which
succeeds to its functions.

       

      “RUS Guaranteed Loan” means any
loan made by any Person, which loan (x) bears interest at least equal to such
Person’s cost of funds and (y) is guaranteed, in whole or in part, as to
principal and interest by the United States of America through the RUS pursuant
to a guarantee, which guarantee contains provisions no less favorable to the
holder thereof than the provisions set forth in the form of Exhibit B-1 or
Exhibit B-2 hereto; and “Guaranteed Portion” of any RUS
Guaranteed Loan means that portion of principal of, and interest on, such RUS
Guaranteed Loan which is guaranteed by the United States of America through the
RUS as provided in clause (y).

       

      “S&P” means Standard and
Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its
successors.

       

      “Securities and Exchange
Commission” means the Securities and Exchange Commission or any other
governmental authority succeeding to any or all of the functions of the
Securities and Exchange Commission.

       

      “SFAS 52” means Statement of
Financial Accounting Standards No. 52 entitled “Foreign Currency Translations”,
issued December, 1981 by the Financial Accounting Standards Board, as amended
from time to time.

       

      “SFAS 133” means Statement of
Financial Accounting Standards No. 133 entitled “Accounting for Derivative
Instruments and Hedging Activities”, issued June, 1998 by the Financial
Accounting Standards Board as amended from time to time.

       

      “Special Purpose Subsidiary”
has the meaning set forth in Section 5.12.

       

      “Start-up Investments” has the
meaning set forth in Section 5.12.

       

      “Subsidiary” of any Person
means (i) any corporation more than 50% of whose stock of any class or classes
having by the terms thereof ordinary voting power to elect a majority of the
directors of such corporation (irrespective of whether or not at the time stock
of any class or classes of such corporation shall have or might have voting
power by reason of the happening of any contingency) is at the time owned by
such Person directly or indirectly through its Subsidiaries, and (ii) any other
Person in which such Person directly or indirectly through Subsidiaries has more
than a 50% voting and equity interest; provided that no Person whose
only assets are RUS Guaranteed Loans and investments incidental thereto shall be
deemed a Subsidiary.

       

      “Superior Indebtedness” means
all Indebtedness of the Borrower and its Consolidated Subsidiaries (other than
Members’ Subordinated Certificates and Qualified Subordinated Indebtedness), but
excluding (i) Indebtedness of the 

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      Borrower
or any of its Consolidated Subsidiaries to the extent that the proceeds of such
Indebtedness are used to fund Guaranteed Portions of RUS Guaranteed Loans and
(ii) any indebtedness of any Member Guaranteed by the Borrower or any of its
Consolidated Subsidiaries (“Guaranteed Indebtedness”), to
the extent that either (x) the long-term unsecured debt of such Member is rated
at least BBB+ by S&P or Baa1 by Moody’s or (y) the payment of principal and
interest by the Borrower or any of its Consolidated Subsidiaries in respect of
such Guaranteed Indebtedness is covered by insurance or reinsurance provided by
an insurer having an insurance financial strength rating of AAA by S&P or a
financial strength rating of Aaa by Moody’s.

       

      “Syndication Agent” means The
Royal Bank of Scotland plc, in its capacity as Syndication Agent hereunder, and
its successors in such capacity.

       

      “TIER” means, for any period,
the ratio of (x) Net Income plus Interest Expense plus Derivative Cash
Settlements to (y) Interest Expense plus Derivative Cash
Settlements, in each case for such period.

       

      “Type” refers to whether a Loan
is a Base Rate Loan, a Euro-Dollar Loan, a Money Market Absolute Rate Loan or a
Money Market LIBOR Loan.

       

      Section
1.02 .  Accounting Terms and
Determinations.   Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations
hereunder shall be made and all financial statements required to be delivered
hereunder shall be prepared in accordance with generally accepted accounting
principles as in effect from time to time, applied on a basis consistent (except
for changes concurred in by the Borrower’s independent public accountants) with
the most recent audited financial statements of the Borrower and its
Consolidated Subsidiaries delivered to the Banks.

       

      Section
1.03 .  Types of
Borrowings.  The term “Borrowing” denotes the
aggregation of Loans of one or more Banks to be made to the Borrower pursuant to
Article 2 on a single date and for a single Interest
Period.  Borrowings are classified for purposes of this Agreement
either by reference to the pricing of Loans comprising such Borrowing (e.g., a “Euro-Dollar Borrowing” is a
Borrowing comprised of Euro-Dollar Loans) or by reference to the provisions of
Article 2 under which participation therein is determined (i.e., a “Revolving  Borrowing”
is a Borrowing under Section 2.01 in which all Banks participate in proportion
to their Commitments, while a “Money Market Borrowing” is a
Borrowing under Section 2.03 in which the Bank participants are determined on
the basis of their bids in accordance therewith).

       

       

      ARTICLE
2

      The
Credits

       

      Section
2.01 .  Commitments to
Lend.  Revolving Loans.  During the Revolving Credit
Period each Bank severally agrees, on the terms and conditions 

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      set forth
in this Agreement, to make loans to the Borrower pursuant to this Section from
time to time in amounts such that the aggregate principal amount of Revolving
Loans by such Bank at any one time outstanding shall not exceed the amount of
its Commitment.  Each Borrowing shall be in an aggregate principal
amount of $10,000,000 or any larger multiple of $1,000,000 (except that any such
Borrowing may be in the maximum aggregate amount available in accordance with
Section 3.03(d)) and shall be made from the several Banks ratably in proportion
to their respective Commitments.  Within the foregoing limits, the
Borrower may borrow under this Section, repay or, to the extent permitted by
Section 2.12, prepay Loans and reborrow at any time during the Revolving Credit
Period under this Section.

       

      Section
2.02 .  Notice of Committed
Borrowings.  The Borrower shall give the Administrative Agent
notice (a “Notice of Committed
Borrowing”) not later than 12:00 noon (New York City time) on (x) the
date of such Borrowing, in the case of each Base Rate Borrowing, and (y) the
third Euro-Dollar Business Day before such Borrowing, in the case of each
Euro-Dollar Borrowing, specifying:

       

      (a) the date
of such Borrowing, which shall be a Domestic Business Day in the case of a Base
Rate Borrowing or a Euro-Dollar Business Day in the case of a Euro-Dollar
Borrowing,

       

      (b) the
aggregate amount of such Borrowing,

       

      (c) whether
the Loans comprising such Borrowing are to bear interest initially at the Base
Rate or a Euro-Dollar Rate, and

       

      (d) in the
case of a Euro-Dollar Borrowing, the duration of the Interest Period applicable
thereto, subject to the provisions of the definition of Interest
Period.

       

      Notwithstanding
the foregoing, no more than 15 Fixed Rate Borrowings  shall be
outstanding at any one time, and any Borrowing which would exceed such
limitation shall be made as a Base Rate Borrowing.

       

      Section
2.03 .  Money Market
Borrowings.   (a) In addition to Committed Borrowings
pursuant to Section 2.01, the Borrower may, as set forth in this Section,
request the Banks during the Revolving Credit Period to make offers to make
Money Market Loans to the Borrower.  The Banks may, but shall have no
obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this
Section.

       

      (b) Money Market Quote
Request.  When the Borrower wishes to request offers to make
Money Market Loans under this Section, it shall transmit to the Administrative
Agent by telex or facsimile transmission a Money Market Quote Request
substantially in the form of Exhibit C hereto so as to be received no later than
10:00 A.M. (New York City time) on (x) the fourth Euro-Dollar Business Day prior
to the date of Borrowing proposed therein, in the case of a LIBOR Auction or
(y) the Domestic Business Day next preceding the date of 

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      Borrowing
proposed therein, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Administrative Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective) specifying:

       

      (i) the
proposed date of Borrowing, which shall be a Euro-Dollar Business Day in the
case of a LIBOR Auction or a Domestic Business Day in the case of an Absolute
Rate Auction,

       

      (ii) the
aggregate amount of such Borrowing, which shall be $10,000,000 or any larger
multiple of $1,000,000,

       

      (iii) the
duration of the Interest Period applicable thereto, subject to the provisions of
the definition of Interest Period, and

       

      (iv) whether
the Money Market Quotes requested are to set forth a Money Market Margin or a
Money Market Absolute Rate.

       

      The
Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request.  No Money
Market Quote Request shall be given within four Euro-Dollar Business Days (or
such other number of days as the Borrower and the Administrative Agent may
agree) of any other Money Market Quote Request.

       

      (c) Invitation for Money Market
Quotes.  Promptly upon receipt of a Money Market Quote Request,
the Administrative Agent shall send to the Banks by telex or facsimile
transmission an Invitation for Money Market Quotes substantially in the form of
Exhibit D hereto, which shall constitute an invitation by the Borrower to each
Bank to submit Money Market Quotes offering to make the Money Market Loans to
which such Money Market Quote Request relates in accordance with this
Section.

       

      (d) Submission and Contents of Money
Market Quotes.  (i) Each Bank may submit a Money Market Quote
containing an offer or offers to make Money Market Loans in response to any
Invitation for Money Market Quotes.  Each Money Market Quote must
comply with the requirements of this subsection (d) and must be submitted to the
Administrative Agent by telex or facsimile transmission at its offices specified
in or pursuant to Section 9.01 not later than (x) 9:30 A.M. (New York City time)
on the third Euro-Dollar Business Day prior to the proposed date of Borrowing,
in the case of a LIBOR Auction or (y) 9:30 A.M. (New York City time) on the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Administrative
Agent shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective); provided that Money Market
Quotes submitted by the Administrative Agent (or any affiliate of the
Administrative Agent) in the capacity of a Bank may 

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      be
submitted, and may only be submitted, if the Administrative Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) 8:30 A.M. (New York City time) on the third
Euro-Dollar Business Day prior to the proposed date of Borrowing, in the case of
a LIBOR Auction or (y) 9:15 A.M. (New York City time) on the proposed date of
Borrowing, in the case of an Absolute Rate Auction.  Subject to
Articles 3 and 6, any Money Market Quote so made shall be irrevocable except
with the written consent of the Administrative Agent given on the instructions
of the Borrower.

       

      (ii) Each
Money Market Quote shall be in substantially the form of Exhibit E hereto and
shall in any case specify:

       

      (A) the
proposed date of Borrowing,

       

      (B) the
principal amount of the Money Market Loan for which each such offer is being
made, which principal amount (w) may be greater than or less than the
Commitment of the quoting Bank, (x) must be $1,000,000 or any larger multiple
thereof, (y) may not exceed the principal amount of Money Market Loans for which
offers were requested and (z) may be subject to an aggregate limitation as to
principal amount of Money Market Loans for which offers being made by such
quoting Bank may be accepted,

       

      (C) in the
case of a LIBOR Auction, the margin above or below the applicable London
Interbank Offered Rate (the “Money Market Margin”) offered
for each such Money Market Loan, expressed as a percentage (rounded to the
nearest 1/10,000th of 1%) to be added to or subtracted from such base
rate,

       

      (D) in the
case of an Absolute Rate Auction, the rate of interest per annum (rounded to the
nearest 1/10,000th of 1%)
(the “Money Market Absolute
Rate”) offered for each such Money Market Loan, and

       

      (E) the
identity of the quoting Bank.

       

      A Money
Market Quote may set forth up to five separate offers by the quoting Bank with
respect to each Interest Period specified in the related Invitation for Money
Market Quotes.

       

      (iii) Any Money
Market Quote shall be disregarded if it:

       

      (A) is not
substantially in conformity with Exhibit E hereto or does not specify all of the
information required by subsection (d)(ii),

       

      
        
          
          

        

        
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      (B) contains
qualifying, conditional or similar language,

       

      (C) proposes
terms other than or in addition to those set forth in the applicable Invitation
for Money Market Quotes, or

       

      (D) arrives
after the time set forth in subsection (d)(i).

       

      (e) Notice to
Borrower.  The Administrative Agent shall promptly notify the
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that is
in accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote
Request.  Any such subsequent Money Market Quote shall be disregarded
by the Administrative Agent unless such subsequent Money Market Quote is
submitted solely to correct a manifest error in such former Money Market
Quote.  The Administrative Agent’s notice to the Borrower shall
specify (A) the aggregate principal amount of Money Market Loans for which
offers have been received for each Interest Period specified in the related
Money Market Quote Request, (B) the respective principal amounts and Money
Market Margins or Money Market Absolute Rates, as the case may be, so offered
and (C) if applicable, limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be
accepted.

       

      (f) Acceptance and Notice by
Borrower.  Not later than 10:30 A.M. (New York City time) on
(x) the third Euro-Dollar Business Day prior to the proposed date of Borrowing,
in the case of a LIBOR Auction or (y) the proposed date of Borrowing, in the
case of an Absolute Rate Auction (or, in either case, such other time or date as
the Borrower and the Administrative Agent shall have mutually agreed and shall
have notified to the Banks not later than the date of the Money Market Quote
Request for the first LIBOR Auction or Absolute Rate Auction for which such
change is to be effective), the Borrower shall notify the Administrative Agent
of its acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e).  In the case of acceptance, such notice (a “Notice of Money Market
Borrowing”) shall specify the aggregate principal amount of offers for
each Interest Period that are accepted.  The Borrower may accept any
Money Market Quote in whole or in part; provided that:

       

      (i) the
aggregate principal amount of each Money Market Borrowing may not exceed the
applicable amount set forth in the related Money Market Quote
Request,

       

      (ii) the
aggregate principal amount of each Money Market Borrowing must be $10,000,000 or
any larger multiple of $1,000,000,

       

      (iii) acceptance
of offers may only be made on the basis of ascending Money Market Margins or
Money Market Absolute Rates, as the case may be, and

       

      
        
          
          

        

        
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      (iv) the
Borrower may not accept any offer that is described in subsection (d)(iii) or
that otherwise fails to comply with the requirements of this
Agreement.

       

      (g) Allocation by
Agent.  If offers are made by two or more Banks with the same
Money Market Margins or Money Market Absolute Rates, as the case may be, for a
greater aggregate principal amount than the amount in respect of which such
offers are accepted for the related Interest Period, the principal amount of
Money Market Loans in respect of which such offers are accepted shall be
allocated by the Administrative Agent among such Banks as nearly as possible (in
such multiples, not greater than $100,000, as the Administrative Agent may deem
appropriate) in proportion to the aggregate principal amounts of such
offers.  Determinations by the Administrative Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest
error.

       

      Section
2.04 . Notice to Banks; Funding of
Loans.  (a) Upon receipt of a Notice of Borrowing, the
Administrative Agent shall promptly notify each Bank on the same Domestic
Business Day of the contents thereof and of such Bank’s share (if any) of such
Borrowing and such Notice of Borrowing shall not thereafter be revocable by the
Borrower.

       

      (b) Not later
than 2:00 P.M. (New York City time) on the date of each Borrowing, each Bank
participating therein shall (except as provided in subsection (c) of this
Section) make available its share of such Borrowing, in Federal or other funds
immediately available in New York City, to the Administrative Agent at its
address specified in or pursuant to Section 9.01.  Unless the
Administrative Agent determines that any applicable condition specified in
Article 3 has not been satisfied, the Administrative Agent will thereafter make
the funds so received from the Banks available to the Borrower at the
Administrative Agent’s aforesaid address.

       

      (c) If any
Bank makes a new Loan hereunder on a day on which the Borrower is to repay all
or any part of an outstanding Loan from such Bank, such Bank shall apply the
proceeds of its new Loan to make such repayment and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being
repaid shall be made available by such Bank to the Administrative Agent as
provided in subsection (b), or remitted by the Borrower to the Administrative
Agent as provided in Section 2.13, as the case may be.

       

      (d) Unless
the Administrative Agent shall have been notified by any Bank prior to the date
of Borrowing (or prior to 2:00 P.M. (New York City time) on the date of
Borrowing in the case of a Base Rate Borrowing) that such Bank does not intend
to make available to the Administrative Agent such Bank’s portion of the
Borrowing to be made on such date, the Administrative Agent may assume that such
Bank has made such amount available to the Administrative Agent on such date and
the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower a corresponding amount, subject to the provisions of subsection
(c).  If such
corresponding amount is not in fact made 

       

      
        
          
          

        

        
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      available
to the Administrative Agent by such Bank, the Administrative Agent shall be
entitled to recover such corresponding amount on demand from such
Bank.  If such Bank does not pay such corresponding amount forthwith
upon the Administrative Agent’s demand therefor, the Administrative Agent shall
promptly notify the Borrower and the Borrower shall promptly pay such
corresponding amount to the Administrative Agent.  The Administrative
Agent shall also be entitled to recover from such Bank or the Borrower interest
on such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (x) in the case of a Bank,
the Federal Funds Rate for each such day and (y) in the case of the Borrower,
the then applicable rate for Base Rate Loans, Euro-Dollar Loans or Money Market
Loans, as appropriate.  Nothing herein shall be deemed to relieve any
Bank from its obligation to fulfill its Commitment hereunder or to prejudice any
rights which the Borrower may have against any Bank as a result of any default
by such Bank hereunder.  For purposes of this subsection (d), no
amount paid to the Administrative Agent hereunder shall be considered to have
been recovered by the Administrative Agent on the date of payment unless such
amount shall have been received by the Administrative Agent by 2:30 P.M. (New
York City time) on such date.

       

      Section
2.05 .  Notes.  (a) Any
Bank may request that the Loans of such Bank be evidenced by a single Note
payable to the order of such Bank for the account of its Applicable Lending
Office in an amount equal to the aggregate unpaid principal amount of such
Bank’s Loans.

       

      (b) Each Bank
that has requested that its Loans be evidenced by a Note may, by notice to the
Borrower and the Administrative Agent, request that its Loans of a particular
Type be evidenced by a separate Note in an amount equal to the aggregate unpaid
principal amount of such Loans.  Each such Note shall be in
substantially the form of Exhibit A hereto with appropriate modifications to
reflect the fact that it evidences solely Loans of the relevant
Type.  Each reference in this Agreement to the “Note” of such Bank shall be
deemed to refer to and include any or all of such Notes, as the context may
require.

       

      (c) Upon
receipt of each Bank’s Note pursuant to Section 3.01(b), the Administrative
Agent shall forward such Note to such Bank.  Each Bank shall record
the date, amount, type and maturity of each Loan made by it and the date and
amount of each payment of principal made by the Borrower with respect thereto,
and may, if such Bank so elects in connection with any transfer or enforcement
of its Note, endorse on the schedule forming a part thereof appropriate
notations to evidence the foregoing information with respect to each such Loan
then outstanding; provided that the failure of
any Bank to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Notes.  Each Bank
is hereby irrevocably authorized by the Borrower so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as and
when required.

       

      
        
          
          

        

        
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      Section
2.06 .  Maturity of
Loans.  Each Loan hereunder shall mature, and the principal
amount thereof shall be due and payable on the Maturity Date with respect to
such Loan.

       

      Section
2.07 .  Interest
Rates.  (a) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Loan is
made until it becomes due, at a rate per annum equal to the Base Rate plus the
applicable Base Rate Margin for such day.  Such interest shall be
payable for each Interest Period on the last day thereof and, with respect to
the principal amount of any Base Rate Loan that is prepaid or converted to a
Euro-Dollar Loan, on the date of such prepayment or conversion.  Any
overdue principal of or interest on any Base Rate Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of 2% plus the rate otherwise applicable to Base Rate Loans for such
day.

       

      (b) Each
Euro-Dollar Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the sum of the Euro-Dollar Margin plus the applicable Adjusted London
Interbank Offered Rate.  Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is longer
than three months, three months after the first day thereof and, with respect to
the principal amount of any Euro-Dollar Loan that is prepaid or converted to a
Base Rate Loan, on the date of such prepayment or conversion.

       

      The
“Adjusted London Interbank
Offered Rate” applicable to any Interest Period means a rate per annum
equal to the quotient obtained (rounded upward, if necessary, to the next higher
1/100 of 1%) by dividing (i) the applicable London Interbank Offered Rate by
(ii) 1.00 minus the Euro-Dollar Reserve Percentage.

       

      The
“London Interbank Offered
Rate” applicable to any Interest Period means the rate appearing on
Reuters BBA Libor Rates Page 3750 (or on any successor or substitute page of
such Reuters Service, or if the Reuters Service ceases to be available, any
successor to or substitute for such Reuters Service, providing rate quotations
comparable to those currently provided on such page of such Reuters Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 A.M. (London time) two
Euro-Dollar Business Days prior to the commencement of such Interest Period, as
the rate for the offering of dollar deposits with a maturity comparable to such
Interest Period; provided
that, if such rate is not available, such rate shall be the average rate
per annum (rounded upward, if necessary, to the next higher 1/100 of 1%) at
which deposits in dollars are offered to each of the Euro-Dollar Reference Banks
in the London interbank market at approximately 11:00 A.M. (London time) two
Euro-Dollar Business Days before the first day of such Interest Period in an
amount approximately equal to the principal amount of the Euro-Dollar Loan of
such Euro-Dollar Reference Bank to which such Interest Period is to apply and
for a period of time comparable to such Interest Period.

       

      
        
          
          

        

        
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      “Euro-Dollar Reserve
Percentage” means for any day that percentage (expressed as a decimal)
which is in effect on such day, as prescribed by the Board of Governors of the
Federal Reserve System (or any successor) for determining the maximum reserve
requirement for a member bank of the Federal Reserve System in New York City
with deposits exceeding five billion dollars in respect of “Eurocurrency
liabilities” (or in respect of any other category of liabilities which includes
deposits by reference to which the interest rate on Euro-Dollar Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United States office of any Bank to United States
residents).  The Adjusted London Interbank Offered Rate shall be
adjusted automatically on and as of the effective date of any change in the
Euro-Dollar Reserve Percentage.

       

      (c) Any
overdue principal of or interest on any Euro-Dollar Loan and any other overdue
amount payable hereunder (other than in respect of any Money Market Loan as
provided in the following paragraph) shall bear interest, payable on demand, for
each day from and including the date payment thereof was due to but excluding
the date of actual payment, at a rate per annum equal to the sum of 2% plus (i)
in the case of principal, the rate otherwise applicable to Euro-Dollar Loans for
such day or (ii) in the case of interest and any other overdue amount payable
hereunder (other than in respect of any Money Market Loan as provided in the
following paragraph), the sum of the Base Rate plus the applicable Base Rate
Margin for such day.

       

      (d) Subject
to Section 8.01(a), each Money Market LIBOR Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the London Interbank Offered
Rate for such Interest Period (determined in accordance with Section 2.07(b))
plus (or minus) the Money Market Margin quoted by the Bank making such Loan in
accordance with Section 2.03.  Each Money Market Absolute Rate Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the Money
Market Absolute Rate quoted by the Bank making such Loan in accordance with
Section 2.03.  Such interest shall be payable for each Interest Period
on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof.  Any
overdue principal of or interest on any Money Market Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of 2% plus the Prime Rate for such day.

       

      (e) The
Administrative Agent shall determine each interest rate applicable to the Loans
hereunder.  The Administrative Agent shall give prompt notice to the
Borrower and the participating Banks of each rate of interest so determined, and
its determination thereof shall be conclusive in the absence of manifest
error.

       

      (f) To the
extent required by this Section, each Euro-Dollar Reference Bank agrees to use
its commercially reasonable efforts to furnish individual 

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

      quotations
to the Administrative Agent.  If either Euro-Dollar Reference Bank
does not furnish a timely quotation, the Administrative Agent shall determine
the relevant interest rate on the basis of the quotation or quotations furnished
by the remaining Euro-Dollar Reference Bank or, if none of such quotations is
available on a timely basis, the provisions of Section 8.01 shall
apply.

       

      Section
2.08 .  Method of Electing Interest
Rates.  (a)  The Loans included in each Committed
Borrowing shall bear interest initially at the type of rate specified by the
Borrower in the applicable Notice of Committed Borrowing.  Thereafter,
the Borrower may from time to time elect to change or continue the type of
interest rate borne by each Group of Loans (subject to Section 2.08(d) and the
provisions of Article 8), as follows:

       

      (i) if such
Loans are Base Rate Loans, the Borrower may elect to convert such Loans to
Euro-Dollar Loans as of any Euro-Dollar Business Day;

       

      (ii) if such
Loans are Euro-Dollar Loans, the Borrower may elect to convert such Loans to
Base Rate Loans as of any Domestic Business Day, subject to Section 2.14 if any
such conversion is effective on any day other than the last day of an Interest
Period applicable to such Loans, or may elect to continue such Loans as
Euro-Dollar Loans, as of the end of any Interest Period applicable thereto, for
an additional Interest Period.

       

      Each such
election shall be made by delivering a notice (a “Notice of Interest Rate
Election”) to the Administrative Agent not later than 10:30 A.M. (New
York City time) on the third Euro-Dollar Business Day before the conversion or
continuation selected in such notice is to be effective.  A Notice of
Interest Rate Election may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that (i) such
portion is allocated ratably among the Loans comprising such Group and (ii) such
portion, and the remaining portion to which such Notice does not apply, are each
at least $10,000,000 (unless such portion is comprised of Base Rate
Loans).  If no such notice is timely received before the end of an
Interest Period for any Group of Euro-Dollar Loans, the Borrower shall be deemed
to have elected that such Group of Loans be converted to Base Rate Loans at the
end of such Interest Period.

       

      (b) Each
Notice of Interest Rate Election shall specify:

       

      (i) the Group
of Loans (or portion thereof) to which such notice applies;

       

      (ii) the date
on which the conversion or continuation selected in such notice is to be
effective, which shall comply with the applicable clause of Section
2.08(a);

       

      
        
          
          

        

        
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      (iii) if the
Loans comprising such Group are to be converted to Euro-Dollar Loans, the
duration of the next succeeding Interest Period applicable thereto;
and

       

      (iv) if such
Loans are to be continued as Euro-Dollar Loans for an additional Interest
Period, the duration of such additional Interest Period.

       

      Each
Interest Period specified in a Notice of Interest Rate Election shall comply
with the provisions of the definition of Interest Period.

       

      (c) Promptly
after receiving a Notice of Interest Rate Election from the Borrower pursuant to
Section 2.08(a), the Administrative Agent shall notify each Bank of the contents
thereof and such notice shall not thereafter be revocable by the
Borrower.

       

      (d) The
Borrower shall not be entitled to elect to convert any Committed Loans to, or
continue any Committed Loans for an additional Interest Period as, Euro-Dollar
Loans if (i) the aggregate principal amount of any Group of Euro-Dollar Loans
created or continued as a result of such election would be less than $10,000,000
or (ii) a Default shall have occurred and be continuing when the Borrower
delivers notice of such election to the Administrative Agent.

       

      (e) If any
Committed Loan is converted to a different Type of Loan, the Borrower shall pay,
on the date of such conversion, the interest accrued to such date on the
principal amount being converted.

       

      Section
2.09 .  Fees.  (a) Facility Fee.  The
Borrower shall pay to the Administrative Agent for the account of each Bank
facility fees accruing at the Facility Fee Rate on the daily average amount of
such Bank’s Commitment (whether used or unused), for the period from and
including the Effective Date to but excluding the date such Bank’s Commitment is
terminated; provided
that, if such Bank continues to have any Committed Loans outstanding after its
Commitment terminates, then such facility fee shall continue to accrue on the
daily outstanding principal amount of such Bank’s Committed Loans from and
including the date on which its Commitment terminates to but excluding the date
on which such Bank ceases to have any Committed Loans
outstanding.  Accrued facility fees shall be payable on each January
1, April 1, July 1, and October 1 and on the date the Commitment of such Bank is
terminated (and, if later, on the date the Loans of such Bank shall be repaid in
their entirety);
provided that any facility fees accruing after the first anniversary of
the Commitment Termination Date shall be payable on demand.

       

      (b) Agents’ Fees.  The
Borrower shall pay to the Administrative Agent and the Syndication Agent, each
for its own account, one or more fees in such amounts and at such times as has
been previously agreed between the Borrower and each of them.

       

      
        
          
          

        

        
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      Section
2.10 .  Optional Termination or Reduction of
Commitments.  During the Revolving Credit Period, the Borrower
may, upon at least three Domestic Business Days’ notice to the Administrative
Agent (which notice the Administrative Agent will promptly deliver to the
Banks), (i) terminate the Commitments at any time, if no Loans are
outstanding at such time or (ii) ratably reduce from time to time by an
aggregate amount of $10,000,000 or any larger multiple of $1,000,000, the
aggregate amount of the Commitments in excess of the aggregate outstanding
principal amount of the Loans.

       

      Section
2.11 .  Mandatory Termination of
Commitments.  The Commitments shall terminate on the Commitment
Termination Date.

       

      Section
2.12 .  Optional
Prepayments.  (a) Subject in the case of Euro-Dollar Loans to
Section 2.14, the Borrower may (i) on any Business Day, upon notice to the
Administrative Agent, prepay any Group of Base Rate Loans (or any Money Market
Borrowing bearing interest at the Base Rate pursuant to Section 8.01(a))
or (ii) upon at least three Euro-Dollar Business Days’ notice to the
Administrative Agent, prepay any Group of Euro-Dollar Loans, in each case in
whole at any time, or from time to time in part in amounts aggregating
$10,000,000 or any larger multiple of $1,000,000, by paying the principal amount
to be prepaid together with accrued interest thereon to the date of
prepayment.  Each such optional prepayment shall be applied to prepay
ratably the Loans of the several Banks included in such Group of Loans (or such
Money Market Borrowing).

       

      (b) Except as
provided in Section 2.12(a), the Borrower may not prepay all or any portion of
the principal amount of any Money Market Loan prior to the maturity
thereof.

       

      (c) Upon
receipt of a notice of prepayment pursuant to this Section, the Administrative
Agent shall promptly notify each Bank of the contents thereof and of such Bank’s
ratable share (if any) of such prepayment and such notice shall not thereafter
be revocable by the Borrower.

       

      Section
2.13 .  General Provisions as to
Payments.  (a) The Borrower shall make each payment of
principal of, and interest on, the Loans and of fees hereunder, not later than
1:00 P.M. (New York City time) on the date when due, in Federal or other funds
immediately available in New York City, to the Administrative Agent at its
address referred to in Section 9.01.  The Administrative Agent will
promptly distribute to each Bank its ratable share of each such payment received
by the Administrative Agent for the account of the Banks.  Whenever
any payment of principal of, or interest on, the Base Rate Loans or of fees
shall be due on a day which is not a Domestic Business Day, the date for payment
thereof shall be extended to the next succeeding Domestic Business
Day.  Whenever any payment of principal of, or interest on, the
Euro-Dollar Loans shall be due on a day which is not a Euro-Dollar Business Day,
the date for payment thereof shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in another
calendar 

       

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

      month, in
which case the date for payment thereof shall be the next preceding Euro-Dollar
Business Day.  Whenever any payment of principal of, or interest on,
the Money Market Loans shall be due on a day which is not a Euro-Dollar Business
Day, the date for payment thereof shall be extended to the next succeeding
Euro-Dollar Business Day.  If the date for any payment of principal is
extended by operation of law or otherwise, interest thereon shall be payable for
such extended time.

       

      (b) Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Banks hereunder that the Borrower
will not make such payment in full, the Administrative Agent may assume that the
Borrower has made such payment in full to the Administrative Agent on such date
and the Administrative Agent may, in reliance upon such assumption, cause to be
distributed to each Bank on such due date an amount equal to the amount then due
such Bank.  If and to the extent that the Borrower shall not have so
made such payment, each Bank shall repay to the Administrative Agent forthwith
on demand such amount distributed to such Bank together with interest thereon,
for each day from the date such amount is distributed to such Bank until the
date such Bank repays such amount to the Administrative Agent, at the Federal
Funds Rate.

       

      Section
2.14 .  Funding
Losses.  If the Borrower makes any payment of principal with
respect to any Fixed Rate Loan or any Fixed Rate Loan is converted to a
different type of Loan (whether such payment or conversion is pursuant to
Article 2, 6 or 8 or otherwise) on any day other than the last day of the
Interest Period applicable thereto, or the end of an applicable period fixed
pursuant to Section 2.07(c), or if the Borrower fails to borrow, prepay, convert
or continue any Fixed Rate Loans after notice has been given to any Bank in
accordance with Section 2.04(a), 2.08(c) or 2.12(c) the Borrower shall reimburse
each Bank within 15 days after demand for any resulting loss or expense incurred
by it (or by an existing Participant in the related Loan), including (without
limitation) any loss incurred in obtaining, liquidating or employing deposits
from third parties, but excluding loss of margin for the period after any such
payment or conversion or failure to borrow, prepay, convert or continue; provided that such Bank shall
have delivered to the Borrower a certificate as to the amount of such loss or
expense, setting forth in reasonable detail the calculation thereof, which
certificate shall be conclusive in the absence of manifest error.

       

      Section
2.15 .  Computation of Interest and
Fees.  Interest based on the Prime Rate and fees hereunder
shall be computed on the basis of a year of 365 days (or 366 days in a leap
year) and paid for the actual number of days elapsed (including the first day
but excluding the last day).  All other interest shall be computed on
the basis of a year of 360 days and paid for the actual number of days elapsed
(including the first day but excluding the last day).

       

      Section
2.16 .  Withholding Tax
Exemption.  At least five Domestic Business Days prior to the
first date on which interest or fees are payable hereunder for the account of
any Bank, each Bank that is not incorporated under 

       

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

      the laws
of the United States of America or a state thereof agrees that it will deliver
to each of the Borrower and the Administrative Agent two duly completed copies
of (i) United States Internal Revenue Service Form W-8BEN (or any successor
form), certifying that such Bank is entitled to benefits under an income tax
treaty to which the United States is a party which exempts such Bank from United
States withholding tax or reduces the rate of withholding tax on payments
received for the account of such Bank under this Agreement and the Notes, or
(ii) United States Internal Revenue Service Form W-8ECI (or any successor form),
certifying that the income receivable by such Bank under this Agreement and the
Notes is effectively connected with the conduct of a trade or business in the
United States.  Each Bank which so delivers a Form W-8BEN or W-8ECI
further undertakes to deliver to each of the Borrower and the Administrative
Agent two additional copies of such form (or a successor form) on or before the
date that such form expires or becomes obsolete or after the occurrence of any
event requiring a change in the most recent form so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Administrative Agent, in each case certifying
to the effect set forth in clause (i) or (ii) above, as applicable, unless an
event (including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Bank from duly completing and delivering any such form with respect to it and
such Bank advises the Borrower and the Administrative Agent that it is not
capable of making the certifications set forth in clause (i) or (ii) above, as
applicable.

       

      Section
2.17 .  Increase of
Commitments.  (a) Upon
at least five days’ prior notice to the Administrative Agent (which notice the
Administrative Agent shall promptly transmit to each of the Banks), the Borrower
shall have the right, subject to the terms and conditions set forth below, to
increase the aggregate amount of the Commitments in multiples of $5,000,000;
provided that the
amount of such increase when added to the aggregate amount of all such prior
increases in the Commitments hereunder (including by way of creating new
Commitments), on or after the Effective Date, does not exceed
$250,000,000.

       

      (b) Any such
increase in the Commitments (the “Incremental Commitments”)
hereunder shall apply, at the option of the Borrower, (x) to the Commitment of
one or more Banks; provided that (i) the
Administrative Agent and each Bank the Commitment of which is to be increased
shall consent to such increase, (ii) the amount set forth on the Commitment
Schedule opposite the name of each Bank the Commitment of which is being so
increased shall be amended to reflect the increased Commitment of such Bank and
(iii) if any Committed Loans are outstanding at the time of such an increase,
the Borrower will, notwithstanding anything to the contrary contained in this
Agreement, on the date of such increase, incur and repay or prepay one or more
Committed Loans from the Banks in such amounts so that after giving effect
thereto the Committed Loans shall be outstanding on a pro rata basis (based on the
Commitments of the Banks after giving effect to the changes made pursuant to
this Section 2.17 on such date) from all the Banks or (y) to the creation of a
new Commitment of one or more 

       

      
        
          
          

        

        
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      institutions
not then a Bank hereunder; provided that (i) such
institution becomes a party to this Agreement as a Bank by execution and
delivery to the Borrower and the Administrative Agent of counterparts of this
Agreement, (ii) the Commitment Schedule shall be amended to reflect the
Commitment of such new Bank, (iii) if requested by such new Bank, the Borrower
shall issue a Note to such new Bank in conformity with the provisions of Section
2.05, (iv) if any Committed Loans are outstanding at the time of the creation of
such Commitment of such Bank, the Borrower will, notwithstanding anything to the
contrary contained in this Agreement, on the date of the creation of such
Commitment, incur and repay or prepay one or more Committed Loans from the Banks
in such amounts so that after giving effect thereto the Committed Loans shall be
outstanding on a pro
rata basis (based on the Commitments of the Banks after giving effect to
the changes made pursuant to this Section 2.17 on such date) from all the Banks
and (v) if such institution is neither a banking institution nor an affiliate of
a Bank, such institution must be consented to by the Administrative Agent. The
date on which the conditions set forth in this paragraph are satisfied is the
“Increased Amount Date”
and each such Bank providing an Incremental Commitment, an “Incremental
Bank”.

       

      (c) On any
Increased Amount Date on which any Incremental Commitments are effective,
subject to the satisfaction of the foregoing conditions, each Incremental
Bank shall become a Bank hereunder with respect to its Incremental Commitment
and the Incremental Loans made pursuant thereto.

       

      (d) The
Administrative Agent shall notify the Banks promptly upon receipt of the
Borrower’s notice of the Increased Amount Date and in respect thereof of
Incremental Commitments and the Incremental Banks.

       

      (e) The terms
and provisions of the Incremental Commitments and any Borrowing in respect of
such Incremental Commitments shall be, except as otherwise set forth herein,
identical to the Commitments on the Effective Date and any other Loans made
under this Agreement.

       

      (f) It is
understood that any increase in the amount of the Commitments pursuant to this
Section 2.17 shall not constitute an amendment of this Agreement or the
Notes.

       

      Section
2.18 .  Replacement of
Banks.  If (i) any Bank requests payment of, or the Borrower is
otherwise required to pay to any Bank, any amount pursuant to Section 8.01(b) or
Section 8.03, or (ii) if any Bank becomes a Defaulting Bank, then the Borrower
may, at its sole expense and effort, upon notice to such Bank and the
Administrative Agent, require such Bank to assign and delegate, without
recourse, all its interests, rights and obligations under this Agreement to an
Assignee (which Assignee may be another Bank, if such other Bank agrees to
accept such assignment) that shall assume such obligations pursuant to an
Assignment and Assumption Agreement in substantially the form of Exhibit G
hereto which shall be executed by such Assignee and (except as otherwise
provided in this Section 2.18) such transferor Bank; provided, that (A) the

       

      
        
          
          

        

        
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      Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (B) such transferor Bank shall
have received payment of an amount equal to the outstanding principal of its
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder (in each case, if any), from the Assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts), which amounts shall be the only amounts payable to
such transferor Bank in respect of such assignment and delegation, (C) any
Bank being replaced pursuant to this Section 2.18 shall be deemed to have
granted to the Administrative Agent the authority to act as its attorney-in-fact
solely for the purpose of executing such Assignment and Assumption Agreement,
and (D) in the case of any such assignment and delegation resulting from a
request or claim for payment under Section 8.03, such assignment will result in
a reduction in any payments due to such transferor Bank on a dollar-for-dollar
basis to the extent that such assignment eliminates or reduces the amount that
such transferor Bank is entitled to receive under Section 8.03.  A
Bank shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Bank or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to
apply.  With respect to a demand for compensation from a Bank pursuant
to Section 8.03(a), the Borrower’s rights under this Section 2.18 shall be an
alternative to the Borrower’s rights under Section 8.04.  Upon
execution and delivery by the Assignee and (except as otherwise provided in this
Section 2.18) the transferor Bank of the Assignment and Assumption Agreement
referred to above and payment by such Assignee to such transferor Bank of the
amount (if any) payable by such Assignee pursuant to clause (B) above:
(1) such Assignee shall be a Bank party to this Agreement and shall have
all the rights and obligations of a Bank with a Commitment equal to such
transferor Bank’s Commitment immediately prior to the effectiveness of such
assignment and delegation (or, if there is more than one Assignee, the
respective portion of such Commitment agreed to be assumed by each such
Assignee); provided,
that if any Assignee is the Borrower, a Subsidiary or a Consolidated Subsidiary
of the Borrower, then, only the transferor Bank’s unfunded Commitment (but not
any of its Loans) may be so assigned, and upon such assignment, such Commitment
shall be deemed to be zero for all purposes hereunder for so long as such
Assignee holds such Commitment; and (2) the transferor Bank shall be
released from its future obligations hereunder (but not from any obligation or
liability arising prior to the effectiveness of such assignment and delegation,
nor, in the case of a Defaulting Bank, from any obligation or liability arising
in respect of the matter(s) as a result of which such Bank is a Defaulting
Bank).  Upon the consummation of any such assignment and delegation,
the transferor Bank, the Administrative Agent and the Borrower shall make
appropriate arrangements so that, if required, a new Note is issued to the
Assignee.  If the Assignee is not incorporated under the laws of the
United States of America or a state thereof, it shall, prior to the first date
on which interest or fees are payable hereunder for its account, deliver to the
Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 2.16. In

       

      
        
          
          

        

        
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      connection
with any assignment pursuant to this Section 2.18, (I) the Borrower shall
cause to be paid to the Administrative Agent an administrative fee for
processing such assignment in the amount of $3,500, and
(II) notwithstanding anything to the contrary set forth herein, if the
transferor Bank does not execute and deliver to the Administrative Agent a duly
completed Assignment and Assumption Agreement reflecting such assignment within
five Domestic Business Days of the date on which the Assignee executes and
delivers such Assignment and Assumption Agreement to the transferor Bank, then
such transferor Bank shall be deemed to have executed and delivered such
Assignment and Assumption Agreement. Notwithstanding the foregoing or anything
to the contrary herein, the Borrower may terminate the unfunded Commitment of
any Defaulting Bank (whether or not such Defaulting Bank has made any Loans),
without affecting Commitments of any non-Defaulting Bank.

       

      Section
2.19 .  Defaulting
Banks.  (a) Notwithstanding any provision of this Agreement to
the contrary, if any Bank becomes a Defaulting Bank, then the following
provisions shall apply for so long as such Bank is a Defaulting
Bank:

       

      (i) facility
fees shall cease to accrue, or to be payable by the Borrower, on the unfunded
portion of the Commitment of such Defaulting Bank pursuant to Section 2.09(a)
for the account of such Defaulting Bank or otherwise; provided, however, that if
such Defaulting Bank’s Commitment is assigned to an Assignee pursuant to Section
2.18, facility fees shall begin to accrue on such assigned Commitment for the
account of such Assignee pursuant to Section 2.09(a) commencing on and from the
effective date of the assignment of such Commitment to such Assignee and shall
be payable by the Borrower pursuant to Section 2.09(a); and

       

      (ii) the
Commitment of such Defaulting Bank shall not be included in determining whether
all Banks or the Required Banks have taken or may take any action hereunder
(including any consent to any amendment or waiver pursuant to Section 9.05);
provided, however, that
if such Defaulting Bank’s Commitment is assigned to an Assignee pursuant to
Section 2.18, then subject to Section 2.18, the Commitment of such Assignee
shall be included in determining whether all Banks or the Required Banks shall
have taken or may take any action hereunder (including any consent to any
amendment or waiver pursuant to Section 9.05) with respect to actions to be
taken by the Banks from and after the effective date of the assignment of such
Commitment to such Assignee.

       

      (b) At the
Borrower’s option, the Borrower may elect to terminate the Commitment of any
Defaulting Bank upon notice to such Defaulting Bank and the Administrative Agent
(irrespective of whether such Defaulting Bank holds any outstanding Loans) and
such notice shall be effective upon receipt by both the Defaulting Bank and the
Administrative Agent; provided that, for the
avoidance of doubt, if such Defaulting Bank holds any Loans, and such Loans are
not assigned pursuant to Section 2.18 or otherwise, then such Defaulting Bank
shall

       

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

       continue
to hold such Loans until such time as such Loans are repaid by the Borrower or
assigned pursuant to this Agreement.

       

       

      ARTICLE
3

      Conditions

       

      Section
3.01 .  Effectiveness.  This
Agreement shall become effective on the date (the “Effective Date”) on which the
Administrative Agent shall have received the following documents or other items,
each dated the Effective Date unless otherwise indicated:

       

      (a) receipt
by the Administrative Agent of counterparts hereof signed by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall
not have been received, receipt by the Administrative Agent in form satisfactory
to it of telegraphic, telex or other written confirmation from such party of
execution of a counterpart hereof by such party);

       

      (b) receipt
by the Administrative Agent for the account of each Bank that has requested a
Note of a duly executed Note dated on or before the Effective Date complying
with the provisions of Section 2.05;

       

      (c) receipt
by the Administrative Agent of an opinion of the General Counsel of the
Borrower, substantially in the form of Exhibit F hereto;

       

      (d) receipt
by the Administrative Agent of a certificate signed by the Chief Financial
Officer or the Chief Executive Officer and an Assistant Secretary-Treasurer or
the Controller of the Borrower to the effect that the conditions set forth in
clauses (c) through (g), inclusive, of Section 3.03 have been satisfied as of
the Effective Date and, in the case of clauses (c), (e) and (g), setting forth
in reasonable detail the calculations required to establish such
compliance;

       

      (e) receipt
by the Administrative Agent, with a copy for each Bank, of a certificate of an
officer of the Borrower acceptable to the Administrative Agent stating that all
consents, authorizations, notices and filings required or advisable in
connection with this Agreement are in full force and effect, and the
Administrative Agent shall have received evidence thereof reasonably
satisfactory to it;

       

      (f) evidence
satisfactory to the Administrative Agent that arrangements have been made for
payment in full of all amounts owed under the Prior 364-Day Credit
Agreement;

       

      (g) receipt
by the Administrative Agent and the Syndication Agent (or their respective
assigns) and by each Bank of all fees required to be paid in the respective
amounts heretofore mutually agreed, and all expenses for which invoices have
been presented, on or before the Effective Date; and

       

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

      (h) receipt
by the Administrative Agent of all documents the Required Banks may reasonably
request relating to the existence of the Borrower, the corporate authority for
and the validity of this Agreement and the Notes, and any other matters relevant
hereto, all in form and substance reasonably satisfactory to the Administrative
Agent.

       

      The
Administrative Agent shall promptly notify the Borrower and the  Banks
of the Effective Date, and such notice shall be conclusive and binding on all
parties hereto.

       

      Section
3.02 .  Prior Credit
Agreement.  (a) On the Effective Date, the “Commitments” as
defined in the Prior 364-Day Credit Agreement shall terminate, without further
action by any party thereto, except that Sections 2.14,
7.05, 7.06, 8.03 and 9.03 of the Prior 364-Day Credit Agreement (and Section
2.13 and Article 9 of the Prior 364-Day Credit Agreement insofar as they relate
to such foregoing Sections) shall survive such termination and any related
payment of amounts owed under the Prior 364-Day Credit Agreement.

       

      (b) The Banks
which are parties to the Prior 364-Day Credit Agreement, comprising the
“Required Banks” as defined therein, hereby waive any requirement of notice of
termination of the “Commitments” (as defined in the Prior 364-Day Credit
Agreement) pursuant to Section 2.10 thereof and of prepayment of loans
thereunder to the extent necessary to give effect to Section 3.01(f) and Section
3.02(a) hereof; provided that any such
prepayment of Loans shall be subject to Section 2.14 of the Prior 364-Day Credit
Agreement.

       

      Section
3.03 .  Borrowings.  The
obligation of any Bank to make a Loan on the occasion of any Borrowing is
subject to the satisfaction of the following conditions, in each case at the
time of such Borrowing and immediately thereafter:

       

      (a) the fact
that the Effective Date shall have occurred on or prior to March 31,
2009;

       

      (b) receipt
by the Administrative Agent of a Notice of Borrowing as required by Section 2.02
or 2.03, as the case may be;

       

      (c) the fact
that the Borrower is in compliance with Section 7.12(a) of the 1972 Indenture
and Section 7.11 of the 1994 Indenture, as each Indenture is in effect as of the
date hereof;

       

      (d) the fact
that the aggregate outstanding principal amount of the Loans will not exceed the
aggregate amount of the Commitments (as such Commitments may be increased
pursuant to Section 2.17;

       

      (e) the fact
that no Default shall have occurred and be continuing;

       

      (f) the fact
that the representations and warranties of the Borrower (in the case of a
Borrowing, other than the representations set forth in Section 4.02(c)

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

      and
Section 4.03) contained in this Agreement shall be true in all material respects
(other than any such representations or warranties that, by their terms, refer
to a specific date other than the date of Borrowing, in which case such
representations and warranties shall be true in all material respects as of such
specific date); and

       

      (g) the fact
that (i) there shall be no collateral securing Bonds issued pursuant to any
Indenture of a type other than the types of collateral permitted to secure Bonds
issued pursuant to such Indenture as of the date hereof, (ii) the allowable
amount of eligible collateral then pledged under any Indenture shall not exceed
150% of the aggregate principal amount of Bonds then outstanding under such
Indenture and (iii) no collateral shall secure Bonds other than (A) eligible
collateral under such Indenture, the allowable amount of which is included
within the computation under subsection (ii) above or (B) collateral previously
so pledged which ceases to be such eligible collateral not as a result of any
acts or omissions to act of the Borrower (other than the declaration of an
“event of default” as
defined in a mortgage which results in the exercise of any right or remedy
described in such mortgage).

       

      Each
Borrowing hereunder shall be deemed to be a representation and warranty by the
Borrower on the date of such Borrowing as to the facts specified in clauses (c),
(d), (e), (f) and (g) of this Section 3.03.

       

       

      ARTICLE
4

      Representations
and Warranties

       

      The
Borrower makes the following representations, warranties and agreements, which
shall survive the execution and delivery of this Agreement and the Notes and the
making of the Loans:

       

      Section
4.01 .  Corporate Existence, Power and
Authority.  The Borrower is a cooperative association duly
incorporated, validly existing and in good standing under the laws of the
District of Columbia and has the corporate power and authority and all material
governmental licenses, authorizations, consents and approvals required to own
its property and assets and to transact the business in which it is
engaged.  The Borrower is duly qualified or licensed as a foreign
corporation in good standing in every jurisdiction in which the nature of the
business in which it is engaged makes such qualification or licensing necessary,
except in those jurisdictions in which the failure to be so qualified or
licensed would not (after qualification, assuming that the Borrower could so
qualify without the payment of any fee or penalty and retain the rights as they
existed prior to such qualification all to an extent so that any fees or
penalties required to be so paid or any rights not so retained would not,
individually or in the aggregate, have a material adverse effect on the business
or financial position of the Borrower), individually or in the aggregate, have a
material adverse effect upon the business or financial position of the
Borrower.  The Borrower has the corporate power and authority to
execute, deliver and carry out the terms and provisions of this Agreement and
the Notes.  This Agreement has been, and the 

       

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

      Notes
when executed and delivered will have been, duly and validly authorized,
executed and delivered by the Borrower, and this Agreement constitutes a legal,
valid and binding agreement of the Borrower, and the Notes, when executed and
delivered by the Borrower in accordance with this Agreement, will constitute
legal, valid and binding obligations of the Borrower, in each case enforceable
in accordance with its terms, except as the same may be limited by bankruptcy,
insolvency, moratorium, reorganization or similar laws affecting the enforcement
of creditors’ rights generally and by general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
law).

       

      Section
4.02 .  Financial
Statements.  (a) The consolidated balance sheets of the
Borrower and its Consolidated Subsidiaries as at May 31, 2008 and the related
consolidated statements of operations, changes in equity and cash flows for the
fiscal year ended May 31, 2008, including the related notes, accompanied by the
opinion and report thereon of Deloitte & Touche LLP, independent public
accountants, heretofore delivered to the Banks, present fairly in all material
respects in accordance with generally accepted accounting
principles (i) the consolidated financial position of the Borrower and
its Consolidated Subsidiaries as at the date of said balance sheets
and (ii) the consolidated results of the operations of the Borrower and its
Consolidated Subsidiaries for said fiscal year.  The Borrower has no
material liabilities (contingent or otherwise) of the type required to be
disclosed in financial statements or footnotes which are not disclosed by or
reserved against in the most recent audited financial statements or in the notes
thereto other than (i) Indebtedness incurred and (ii) loan and guarantee
commitments issued in each case by the Borrower in the ordinary course of
business since the date of such financial statements.  All such
financial statements have been prepared in accordance with generally accepted
accounting principles applied on a basis consistent with prior periods, except
as disclosed therein.  The same representations as are set forth in
this Section 4.02 shall be deemed to have been made by the Borrower in respect
of the most recent annual and quarterly financial statements of the Borrower and
its Consolidated Subsidiaries (except that the annual opinion and report of
Deloitte & Touche LLP may be replaced by an opinion and report of another
nationally recognized firm of independent public accountants) furnished or
required to be furnished to the Banks prior to or at the time of the making of
each Loan hereunder, at the time the same are furnished or required to be
furnished.

       

      (b) The
unaudited consolidated balance sheets of the Borrower and its Consolidated
Subsidiaries as of November 30, 2008 and the related unaudited consolidated
statements of operations, changes in equity and cash flows for the six months
then ended, heretofore delivered to the Banks, present fairly in conformity with
generally accepted accounting principles applied on a basis consistent with the
financial statements referred to in subsection (a) of this Section 4.02, the
consolidated financial position of the Borrower and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
changes in financial position for such six-month period (subject to normal
year-end adjustments).  The Borrower and its Consolidated Subsidiaries
have no material liabilities (contingent or otherwise) of the type required to
be 

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

      disclosed
in financial statements or footnotes which are not disclosed by or reserved
against in such financial statements for such six-month period other than (i)
Indebtedness incurred and (ii) loan and guarantee commitments issued in each
case by the Borrower or its Consolidated Subsidiaries in the ordinary course of
business since the date of such financial statements.

       

      (c) Since
November 30, 2008 and except as disclosed in the Borrower’s public filings two
Domestic Business Days prior to the date hereof, there has been no material
adverse change in the business, financial position or results of operations of
the Borrower and its Consolidated Subsidiaries, considered as a
whole.

       

      Section
4.03 .  Litigation.  There
are no actions, suits, proceedings or investigations pending or, to the
Borrower’s knowledge, threatened by or before any court or any governmental
authority, body or agency or any arbitration board which are reasonably likely
to materially adversely affect the business, financial position or results of
operations of the Borrower or the authority or ability of the Borrower to
perform its obligations under this Agreement or the Notes.

       

      Section
4.04 .  Governmental
Authorizations.  No material authorization, consent, approval
or license of, or declaration, filing or registration with or exemption by, any
governmental authority, body or agency is required in connection with the
execution, delivery or performance by the Borrower of this Agreement or the
Notes.  The Banks acknowledge that the Borrower may file this
Agreement with the Securities and Exchange Commission after the Effective
Date.

       

      Section
4.05 .  Members’ Subordinated
Certificates.  The holders of the Borrower’s Members’
Subordinated Certificates are not and will not be entitled to receive any
payments with respect to the principal thereof or interest thereon solely
because of withdrawing or being expelled from membership in the
Borrower.

       

      Section
4.06 .  No Violation of
Agreements.  Neither the Borrower nor any Subsidiary is in
default in any material respect under any material agreement or other material
instrument to which it is a party or by which it is bound or its property or
assets may be affected.  No event or condition exists which
constitutes, or with the giving of notice or lapse of time or both would
constitute, such a default under any such agreement or other
instrument.  Neither the execution and delivery of this Agreement or
the Notes, nor the consummation of any of the transactions herein or therein
contemplated, nor compliance with the terms and provisions hereof or thereof,
will contravene any material provision of law, statute, rule or regulation to
which the Borrower is subject or any material judgment, decree, award,
franchise, order or permit applicable to the Borrower, or will conflict or be
inconsistent with, or will result in any breach of, any of the material terms,
covenants, conditions or provisions of, or constitute (or with the giving of
notice or lapse of time, or both, would constitute) a material default under (or
condition or event entitling any Person to require, whether by purchase,

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

      redemption,
acceleration or otherwise, the Borrower to perform any obligations prior to the
scheduled maturity thereof), or result in the creation or imposition of any Lien
upon any of the property or assets of the Borrower pursuant to the terms of, any
material indenture, mortgage, deed of trust, agreement or other instrument to
which it may be subject, or violate any provision of the certificate of
incorporation or by-laws of the Borrower.  Without limiting the
generality of the foregoing, the Borrower is not a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness of
the Borrower, any agreement or indenture relating thereto or any other material
contract or agreement (including its certificate of incorporation and by-laws),
which would be violated by the incurring of the Indebtedness to be evidenced by
the Notes.

       

      Section
4.07 .  No Event of Default under the
Indentures.  The Borrower has complied fully with all of the
material provisions of each Indenture.  No Event of Default (within
the meaning of such term as defined in each Indenture) and no event, act or
condition (except for possible non-compliance by the Borrower with any
immaterial provision of such Indenture which in itself is not such an Event of
Default under such Indenture) which with notice or lapse of time, or both, would
constitute such an Event of Default has occurred and is continuing under such
Indenture.  The Borrowings by the Borrower contemplated by this
Agreement will not cause such an Event of Default under, or the violation of any
covenant contained in, any Indenture.

       

      Section
4.08 .  Compliance with
ERISA.  The Plans (other than Plans consisting of multiemployer
plans (as defined in Section 4001 of ERISA)) are in substantial compliance with
ERISA other than any failure to comply that is not reasonably likely to have a
material adverse effect on the business, results of operations or financial
position of the Borrower, no such Plan is insolvent or in reorganization other
than an insolvency or reorganization that is not reasonably likely to have a
material adverse effect on the business, results of operations or financial
position of the Borrower, and no such Plan has an accumulated or waived funding
deficiency within the meaning of Section 412 of the Internal Revenue Code other
than any accumulated or waived funding deficiency that is not reasonably likely
to have a material adverse effect on the business, results of operations or
financial position of the Borrower.  No Plan consisting of a
multiemployer plan (as defined in Section 4001 of ERISA) is in
reorganization.  Neither the Borrower nor a Subsidiary of the Borrower
nor any member of the ERISA Group has incurred any material liability (including
any material contingent liability) to or on account of a Plan pursuant to
Section 4062, 4063, 4064, 4201 or 4204 of ERISA, no proceedings have been
instituted to terminate any Plan, and no condition exists which presents a
material risk to the Borrower of incurring a material liability to or on account
of a Plan pursuant to any of the foregoing Sections of ERISA.

       

      Section
4.09 .  Compliance with Other
Laws.  The Borrower and each Subsidiary is in compliance, in
all material respects, with all applicable requirements of law and all
applicable rules and regulations of each Federal, 

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

      State,
municipal or other governmental department, agency or authority, domestic or
foreign.

       

      Section
4.10 .  Tax Status.  The
Borrower is exempt from payment of Federal income tax under Section 501(c)(4) of
the Internal Revenue Code.

       

      Section
4.11 .  Investment Company
Act.  The Borrower is not an “investment company” or a company
“controlled” by an “investment company”, within the meaning of the Investment
Company Act of 1940, as amended.

       

      Section
4.12 .  Disclosure.  Neither
this Agreement nor any document, certificate or financial statement furnished to
any Bank by or on behalf of the Borrower in connection herewith (all such
documents, certificates and financial statements, taken as a whole) contains, as
of the date of delivery thereof and taken as a whole, any untrue statement of a
material fact or omits to state any material fact necessary in order to make the
statements contained herein and therein not misleading; provided that, with respect
to projected financial information, the Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time.

       

      Section
4.13 .  Subsidiaries.  Each
of the Borrower’s corporate Subsidiaries is a corporation duly incorporated,
validly existing and in good standing under the laws of its jurisdiction of
incorporation, and has all corporate powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.

       

      Section
4.14 .  Environmental
Matters.  In the ordinary course of its business, the Borrower
conducts reviews, to the extent appropriate given the nature of its business
operations, of the effect of Environmental Laws on the business, operations and
properties of the Borrower and its Subsidiaries, in the course of which it
identifies and evaluates associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat, any costs or liabilities
in connection with off-site disposal of wastes or Hazardous Substances, and any
actual or potential liabilities to third parties, including employees, and any
related costs and expenses).  On the basis of this review, the
Borrower has reasonably concluded that such associated liabilities and costs,
including the cost of compliance with Environmental Laws, are unlikely to have a
material adverse effect on the business, financial position or results of
operations of the Borrower and its Consolidated Subsidiaries, considered as a
whole.

       

      
        
          
          

        

        
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      ARTICLE
5

      Covenants

       

      The
Borrower agrees that, so long as any Bank has any Commitment hereunder or any
amount payable under any Note or any fee payable pursuant to Section 2.09 or any
other amount then due and payable hereunder remains unpaid:

       

      Section
5.01 .  Corporate
Existence.  The Borrower, at its own cost and expense, will,
and will cause each Subsidiary to, do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence, material
rights and franchises; provided, however, that
neither the Borrower nor any Subsidiary shall be required to preserve any right
or franchise or, in the case of a Subsidiary, its corporate existence, if its
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Borrower or such Subsidiary
(provided that the
termination of the corporate existence of a Subsidiary shall be permitted if the
Board of Directors of the Borrower shall determine that its existence is not
desirable in the conduct of the business of the Borrower) and that the loss
thereof is not disadvantageous in any material respect to the
Banks.

       

      Section
5.02 .  Disposition of Assets, Merger,
Character of Business, etc.  The Borrower will not wind up or
liquidate its business or sell, lease, transfer or otherwise dispose of all or
substantially all of its assets as an entirety or in a series of related
transactions and will not consolidate with or merge with or into any other
Person other than a merger with a Subsidiary in which the Borrower is the
surviving Person.  The Borrower will not engage in any business other
than the business contemplated by its certificate of incorporation and by-laws,
each as in effect on the Effective Date.

       

      Section
5.03 .  Financial
Information.  (a) The Borrower will, and will cause each
Subsidiary other than the Subsidiaries listed on Schedule 5.03(a) to, keep its
books of account in accordance with generally accepted accounting
principles.

       

      (b) The
Borrower will furnish to the Administrative Agent for distribution to the
Banks:

       

      (i) as soon
as available and in any event within 60 days after the close of each of the
first three quarters of each fiscal year of the Borrower, as at the end of, and
for the period commencing at the end of the previous fiscal year and ending
with, such quarter, unaudited consolidated balance sheets of the Borrower and
its Consolidated Subsidiaries and the related unaudited consolidated statements
of operations, changes in equity and cash flow of the Borrower and its
Consolidated Subsidiaries for such quarter and for the portion of the Borrower’s
fiscal year ended at the end of such quarter, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding
portion of the Borrower’s previous fiscal year, all in 

       

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

      reasonable
detail and certified (subject to normal year-end adjustments) as to fairness of
presentation in accordance with generally accepted accounting principles in all
material respects and consistency (except for changes concurred in by the
Borrower’s independent public accountants) by the Chief Executive Officer, the
Chief Financial Officer, an Assistant Secretary-Treasurer or the Controller of
the Borrower;

       

      (ii) as soon
as practicable and in any event within the earlier of (i) two Domestic Business
Days after filing with the Securities and Exchange Commission and (ii) 120 days
after the close of each fiscal year of the Borrower, as at the end of and for
the fiscal year just closed, consolidated balance sheets of the Borrower and its
Consolidated Subsidiaries and the related consolidated statements of operations,
changes in equity and cash flow for such fiscal year for the Borrower and its
Consolidated Subsidiaries, all in reasonable detail and certified (without any
qualification as to the scope of the audit) by Deloitte & Touche LLP or
other independent public accountants of nationally recognized standing selected
by the Borrower, who shall have audited the books and accounts of the Borrower
for such fiscal year;

       

      (iii) together
with the financial statements referred to in clauses (i) and (ii) above, a
certificate signed by the Chief Executive Officer, the Chief Financial Officer,
an Assistant Secretary-Treasurer or the Controller of the Borrower, in such
detail as shall be reasonably satisfactory to the Required Banks,

       

      (A) identifying
(x) all Indebtedness outstanding as at the end of the fiscal period covered by
such financial statements extended by the Borrower or its Consolidated
Subsidiaries or by any other Person and Guaranteed by the Borrower or its
Consolidated Subsidiaries to the ten Members or borrowers of any Consolidated
Subsidiary (“Consolidated
Subsidiary Members”), taken as a whole, with the largest amount of
Indebtedness to (or Guaranteed by) the Borrower or its Consolidated Subsidiaries
outstanding as at the end of the fiscal period covered by such financial
statements (the “Largest
Members”) as to which, to the knowledge and information of the Borrower
or such Consolidated Subsidiary, the Member or Consolidated Subsidiary Member is
in default (whether in the payment of the principal thereof or interest thereon
or with respect to any material covenant or agreement contained in any
instrument, mortgage or agreement evidencing or relating to such Indebtedness)
and specifying whether such default has been waived by the Borrower or such
Consolidated Subsidiary or such other Person and the nature and status of each
such default not so waived and (y) the aggregate amount of all Indebtedness
outstanding as of the end of the fiscal period covered by such financial
statements as to which, to the knowledge and information of the Borrower or such
Consolidated Subsidiary, 

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

      Members
or Consolidated Subsidiary Members other than the Largest Members are in default
in the payment of the principal thereof or interest thereon or are in default
with respect to any material covenant or agreement contained in any instrument,
mortgage or agreement evidencing or relating to such Indebtedness and as to
which the Borrower or such Consolidated Subsidiary has commenced the exercise of
remedies in respect thereof,

       

      (B) identifying
the ten Members or Consolidated Subsidiary Members, taken as a whole, with the
largest amount of Indebtedness to (or Guaranteed by) the Borrower or its
Consolidated Subsidiaries outstanding as of the end of the fiscal period covered
by such financial statements, together with the principal amount of such
Indebtedness outstanding with respect to each such Member or Consolidated
Subsidiary Member as of the end of such fiscal period, and

       

      (C) providing
the aggregate principal amount of all loans which are RUS Guaranteed Loans and
are outstanding as of the end of the fiscal period covered by such financial
statements, provided
that if such amount has previously been disclosed by the Borrower in its regular
or periodical reports filed with, or furnished to, the Securities and Exchange
Commission, then the certificate need only reference such report and the section
of such report in which such information may be found;

       

      (iv) with
reasonable promptness, copies of all regular and periodical reports (including
Current Reports on Form 8-K) filed with, or furnished to, the Securities and
Exchange Commission;

       

      (v) promptly
after obtaining knowledge or receiving notice of a change (whether an increase
or decrease) in any rating issued by S&P or Moody’s pertaining to any
securities of, or guaranteed by, the Borrower or any of its Subsidiaries or
affiliates, a notice setting forth such change; and

       

      (vi) with
reasonable promptness, such other information respecting the business,
operations and financial condition of the Borrower or any of its Subsidiaries or
any Joint Venture as any Bank may, from time to time, reasonably request,
including, without limitation, with respect to the performance and observance by
the Borrower of the covenants and conditions contained in this
Agreement.

       

      Section
5.04 .  Default
Certificates.  Concurrently with each financial statement
delivered to the Administrative Agent pursuant to clauses (i) and (ii) of
Section 5.03(b), the Borrower will furnish to the Administrative Agent a
certificate signed by the Chief Executive Officer, the Chief Financial Officer,
an Assistant Secretary-Treasurer or the Controller of the Borrower to the effect
that 

       

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

      the
review of the activities of the Borrower during such year or the portion thereof
covered by such financial statement and of the performance of the Borrower under
this Agreement has been made under his supervision and that to the best of his
knowledge, based on such review, there exists no event which constitutes a
Default or an Event of Default under this Agreement or, if any such event
exists, specifying the nature thereof, the period of its existence and what
action the Borrower has taken and proposes to take with respect thereto, which
certificate shall set forth the calculations or other data required to establish
compliance with the provisions of Section 5.09 and Sections 5.12 through 5.14,
inclusive, at the end of such fiscal quarter or fiscal year, as the case may
be.  The Borrower further covenants that upon any such officer of the
Borrower obtaining knowledge of any Default or Event of Default under this
Agreement, it will forthwith, and in no event later than the close of business
on the third (3rd)
Domestic Business Day immediately after the day such knowledge is obtained,
deliver to the Administrative Agent a statement of any officer referred to above
specifying the nature and the period of existence thereof and what action the
Borrower has taken and proposes to take with respect thereto.

       

      Section
5.05 .  Notice of Litigation, Legislative
Developments and Defaults.  The Borrower will promptly give
written notice to the Administrative Agent of (i) any action, proceeding or
claim of which the Borrower may have notice, which may be commenced against the
Borrower or any Subsidiary in which the amount involved is $50,000,000 or more
and is not covered in full by insurance or as to which any insurer has
disclaimed liability; (ii) any dispute which may exist between the Borrower or
any Subsidiary and any governmental body, which is likely to materially and
adversely affect the normal business operation of the Borrower or the Borrower
and its Subsidiaries taken as a whole or any of the material properties and
assets of the Borrower or the Borrower and its Subsidiaries taken as a whole;
(iii) any legislation enacted by any governmental body and any rulings and
regulations promulgated by any governmental or regulatory bodies, known to the
Borrower, affecting the Borrower or any Subsidiary or, if known to the Borrower,
generally affecting the Borrower’s Members which is likely to materially and
adversely affect the present or future operations of the Borrower, the Borrower
and its Subsidiaries taken as a whole or the Borrower’s Members; and
(iv) any default by the Borrower or any Subsidiary or event or condition
known to the Borrower which with the giving of notice or lapse of time, or both,
would constitute a default, with respect to any payment or payments in respect
of Indebtedness of the Borrower or such Subsidiary aggregating in excess of
$25,000,000 (whether in payment of principal thereof or interest thereon or with
respect to any material covenant or agreement contained in any instrument,
mortgage, deed of trust or agreement evidencing or relating to such Indebtedness
or otherwise), provided
that if any matter described in clauses (i) through (iv) of this Section has
previously been disclosed by the Borrower in its regular or periodical reports
filed with, or furnished to, the Securities and Exchange Commission, then no
additional written notice shall be required under this Section.

       

      
        
          
          

        

        
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      Section
5.06 .  ERISA.  As soon as
possible and, in any event, within 10 days after the Borrower or a Subsidiary of
the Borrower knows or has reason to know that a Reportable Event has occurred,
that an accumulated funding deficiency has been incurred or an application may
be or has been made to the Secretary of the Treasury for a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code with respect to
a Plan, that a Plan has been or may be terminated, that proceedings may be or
have been instituted to terminate a Plan, or that the Borrower, a Subsidiary of
the Borrower or any member of the ERISA Group will or may incur any liability in
excess of $5,000,000 to or on account of a Plan under Section 4062, 4063, 4064,
4201 or 4204 of ERISA, the Borrower will deliver to the Administrative Agent a
certificate of the Chief Financial Officer of the Borrower setting forth details
as to such occurrence and action, if any, which the Borrower or such Subsidiary
is required or proposes to take, together with any notices required to be filed
by the Borrower, such Subsidiary, such member of the ERISA Group or the plan
administrator with the PBGC with respect thereto.

       

      Section
5.07 .  Payment of
Charges.  The Borrower will, and will cause each Subsidiary to,
duly pay and discharge (i) all taxes, assessments and governmental charges or
levies imposed upon or against it or its property or assets, prior to the date
on which material penalties attach thereto, unless and to the extent only that
such taxes, assessments and governmental charges or levies are being contested
in good faith by appropriate proceedings or unless the failure to do so will not
have a material adverse effect on the business, financial position or results of
operations of the Borrower; and (ii) all lawful claims, including, without
limitation, claims for labor, materials, supplies or services, which might or
could, if unpaid, become a Lien upon such property or assets, unless and to the
extent only that the validity or the amount thereof is being contested in good
faith by appropriate proceedings or unless the failure to do so will not have a
material adverse effect on the business, financial position or results of
operations of the Borrower.

       

      Section
5.08 .  Inspection of Books and
Assets.  The Borrower will, and will cause each Subsidiary to,
permit any representative of any Bank (or any agent or nominee of such Bank) to
visit and inspect any of the property of the Borrower or such Subsidiary, to
examine the books of record and account of the Borrower or such Subsidiary and
to discuss the affairs, finances and accounts of the Borrower or such Subsidiary
with the officers and independent public accountants of the Borrower or such
Subsidiary, all at such reasonable times and as often as such Bank may
reasonably request.

       

      Section
5.09 .  Indebtedness.  (a) The
Borrower will not, and will not permit any of its Consolidated Subsidiaries
(other than Rural Telephone Finance Cooperative and National Cooperative
Services Corporation) to, incur, assume or Guarantee any Superior Indebtedness,
or make any optional prepayment on any Members’ Subordinated Certificate; provided that (i)
subject to the provisions of Section 5.12, any such Subsidiary may incur
Superior Indebtedness owing to the Borrower or assume or Guarantee Indebtedness
of any Person (other than the 

       

      
        
          
          

        

        
          42

          
            

          

        

        
          
          

        

      

      Borrower
or any of its Subsidiaries) owing to the Borrower and (ii) the Borrower may
incur, assume or Guarantee Superior Indebtedness or make optional prepayments on
Members’ Subordinated Certificates if, after giving effect to any such action
specified above in this clause (ii), (x) on the date of such incurrence,
assumption or Guarantee or making of such optional prepayment (the “Determination Date”) the
aggregate principal amount of Superior Indebtedness then outstanding would not
exceed ten times the sum of (a) the aggregate principal amount of Members’
Subordinated Certificates outstanding on the Determination Date, (b) the
aggregate amount of the line item “total equity” shown on the consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries on the
Determination Date, (c) the aggregate amount of the line item “minority
interest” shown on the consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries on the Determination Date and (d) the aggregate
principal amount of Qualified Subordinated Indebtedness outstanding on the
Determination Date and (y) on no given future date ending on the last day
of each fiscal quarter would the aggregate principal amount of Superior
Indebtedness outstanding on the Determination Date which will remain outstanding
on such given future date exceed ten times the sum of (a) the aggregate
principal amount of Members’ Subordinated Certificates outstanding on the
Determination Date which will remain outstanding on such given future fiscal
quarter-end date, (b) the aggregate amount of the line item “total equity” shown
on the consolidated  balance sheet of the Borrower and its
Consolidated Subsidiaries on the Determination Date, (c) the aggregate amount of
the line item “minority interest” shown on the consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries on the Determination Date and (d) the
aggregate principal amount of Qualified Subordinated Indebtedness outstanding on
the Determination Date which will remain outstanding on such given future date;
provided that the
non-cash adjustments (whether positive or negative) required to be made pursuant
to SFAS 133 and SFAS 52 shall be excluded from calculations under clause (ii)
above to the extent otherwise included therein.  The respective
principal amounts of Superior Indebtedness, Members’ Subordinated Certificates
and Qualified Subordinated Indebtedness to be outstanding on such given future
date shall be determined after giving effect to mandatory sinking fund payments,
other mandatory prepayments and serial and other maturity payments required to
be made on or prior to said given future date by the terms of such Superior
Indebtedness, Members’ Subordinated Certificates, Qualified Subordinated
Indebtedness or any indenture or other instrument pursuant to which they are
respectively issued.

       

      (b) If any
Loan is outstanding hereunder, the Borrower will not take any action which would
prevent it from then complying, or fail to take any action which would enable it
then to comply, with the provisions of Section 3.03(g), assuming for this
purpose only that the Borrower then intended to borrow from one or more of the
Banks hereunder.

       

      Section
5.10 .  Liens.  The
Borrower will not create or permit to exist any Lien on or with respect to any
Indebtedness of any Member which is an asset of the Borrower, now existing or
hereafter created, or on any notes, mortgages or 

       

      
        
          
          

        

        
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      other
documents or instruments evidencing any such Indebtedness, and the Borrower will
not permit any Consolidated Subsidiary to create or permit to exist any Lien on
or with respect to any of such Subsidiary’s assets, except Liens (i) granted by
the Borrower to the trustee pursuant to any Indenture, (ii) on any such
Indebtedness granted by the Borrower or its Consolidated Subsidiary to secure
any borrowing for the purpose of making loans to Member power supply systems or
loans to Members for bulk power supply projects or loans to Members for the
purpose of providing financing to telephone and related systems eligible to
borrow from the RUS or loans to borrowers borrowing from National Cooperative
Services Corporation or Rural Telephone Finance Cooperative, which borrowing or
borrowings are on terms (except as to terms of interest, premium, if any, and
amortization) not materially more disadvantageous to the Borrower’s unsecured
creditors than the borrowings under any Indenture (it being understood that the
Borrower can not pledge such assets to an extent greater than 150% of the
aggregate principal amount of such Indebtedness), (iii) of current taxes not
delinquent or a security for taxes being contested in good faith, (iv) other
than in favor of the PBGC, created by or resulting from any legal proceedings
(including legal proceedings instituted by the Borrower or any Subsidiary) which
are being contested in good faith by appropriate proceedings, including appeals
of judgments as to which a stay of execution shall have been issued, and
adequate reserves shall have been established, (v) created by the Borrower to
secure Guarantees by the Borrower of Indebtedness, the interest on which is
excludable from the gross income of the recipient thereof for Federal income tax
purposes as provided in Section 103(a) of the Internal Revenue Code or Section
103(a) of the Internal Revenue Code of 1954, as amended, (x) of a Member which
is a state or political subdivision thereof or (y) of a state or political
subdivision thereof incurred to benefit a Member for one of the purposes
provided in Section 142(a)(2), (4), (5), (6), (8), (9), (10) or (12) of the
Internal Revenue Code or Section 103(b)(4)(D), (E), (F), (G), (H) or (J) of the
Internal Revenue Code of 1954, as amended, (vi) granted by any Subsidiary to the
Borrower, (vii) REDLG Program Liens securing REDLG Obligations with respect to
government Guarantees of Indebtedness of the Borrower and (viii) on any such
Indebtedness granted by the Borrower to secure any borrowings, which borrowings
are on terms (except as to terms of interest, premium, if any, and amortization)
not materially more disadvantageous to the Borrower’s unsecured creditors than
the borrowings under any Indenture (it being understood that the Borrower can
not pledge such assets to an extent greater than 150% of the aggregate principal
amount of such Indebtedness); provided that Liens incurred
in reliance on clauses (ii), (vii) and (viii) of this Section 5.10 shall not
secure amounts exceeding $7,500,000,000 in the aggregate at any one time
outstanding.

       

      Section
5.11 .  Maintenance of
Insurance.  The Borrower will maintain, and will cause each
Subsidiary to maintain, insurance in such amounts, on such forms and with such
companies as is necessary or appropriate for its business.

       

      Section
5.12 .  Subsidiaries and Joint
Ventures.  The Borrower will not permit (a) the sum
of (i) the amount of Indebtedness owing to the Borrower by all of its
Subsidiaries and Joint Ventures plus (ii) the amount
paid by the Borrower in 

       

      
        
          
          

        

        
          44

          
            

          

        

        
          
          

        

      

      respect
of the stock, obligations or securities of or any other interest in such
Subsidiaries and Joint Ventures plus (iii) any capital
contributions by the Borrower to such Subsidiaries and Joint Ventures (the
amounts referred to in paragraphs (i) through (iii), the “Investments”) plus (iv) the amount of
assets (excluding Foreclosed Assets) otherwise sold or transferred by the
Borrower to such Subsidiaries and Joint Ventures (other than sales at fair
market value) minus (v)
any Start-up Investments minus (vi) any Investment
made in cash by the Borrower in any Special Purpose Subsidiary (up to a maximum
amount not to exceed the lesser of (x) the amount necessary to provide such
Special Purpose Subsidiary with sufficient working capital to conduct its
business as contemplated hereby and (y) $150,000,000) to exceed at any
time (b) 10% of the sum of (i) all accounts which, in accordance with
generally accepted accounting principles, constitute equity in the Borrower and
its Consolidated Subsidiaries at such time plus (ii) all Indebtedness of
the Borrower shown on its balance sheet dated as of May 31, 2008 as Members’
Subordinated Certificates as such Indebtedness shall be reduced from time to
time and any other Indebtedness of the Borrower incurred after May 31, 2008
having substantially similar provisions as to subordination as those contained
in said outstanding certificates as such other Indebtedness shall be reduced
from time to time, in each case at such time plus (iii) all “minority
interest” shown on the consolidated statement of operations of the Borrower and
its Consolidated Subsidiaries most recently delivered by the Borrower to the
Administrative Agent pursuant to Section 4.02 or Section 5.03 plus (iv) all Qualified
Subordinated Indebtedness outstanding at such time; provided that non-cash
adjustments (whether positive or negative) required to be made pursuant to SFAS
133 and SFAS 52 shall be excluded from the calculation of the amounts specified
in clauses (b)(i), (b)(ii), (b)(iii) and (b)(iv) of this Section 5.12 to the
extent otherwise included therein; provided, further, that, in
addition to the foregoing, the Borrower may transfer assets with an aggregate
fair market value of not more than $150,000,000 to a bankruptcy remote trust
required to be established to support REDLG Obligations of the Borrower, and any
such transfer shall be excluded from any calculation under clauses (a) and (b)
above to the extent otherwise included therein.  For the purpose of
this Section 5.12, “Foreclosed
Asset” means (x) any property distributed or to be distributed to the
Borrower with the authority of any Bankruptcy Court in connection with the
bankruptcy of any of the Borrower’s debtors and (y) property received by the
Borrower upon enforcement by the Borrower of its security interest (if any) in
such property or in settlement of delinquent accounts or other overdue amounts
owed to it by any of the Borrower’s debtors; “Special Purpose Subsidiary”
means any domestic Subsidiary all of the shares of capital stock or other
ownership interest of which are directly or indirectly owned by the Borrower,
which Subsidiary is established for the sole purpose of, and whose sole business
shall at all times be, holding Foreclosed Assets; and “Start-up Investments” means
Investments made in a Special Purpose Subsidiary solely to finance such Special
Purpose Subsidiary’s initial acquisition of Foreclosed Assets.

       

      Section
5.13 .  Minimum TIER.  The
Borrower shall not permit, as of the last day of each fiscal quarter, the
average of the TIERs for the six (6) 

       

      
        
          
          

        

        
          45

          
            

          

        

        
          
          

        

      

      immediately
preceding fiscal quarters (including the fiscal quarter ending on such date) of
the Borrower to be less than 1.025:1.00.

       

      Section
5.14 .  Retirement of Patronage
Capital.  The Borrower shall not make, or permit any
Subsidiaries of the Borrower to make, any payments to Members in respect of
Patronage Capital Certificates unless (i) the TIER for the immediately preceding
fiscal year for which financial statements have been delivered to the
Administrative Agent pursuant to Section 5.03(b) equals or exceeds 1.05:1.00 and
(ii) there exists (and would exist after giving effect to any such payment) no
Default or Event of Default under this Agreement.

       

      Section
5.15 .  Use of
Proceeds.  The proceeds of the Loans made hereunder may be used
by the Borrower for general corporate purposes.  None of such proceeds
will be used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of buying or carrying any “margin stock”, within the
meaning of Regulation U.  Neither the Borrower nor any of its
Subsidiaries has taken or will take any action which might cause this Agreement
or the Notes to violate Regulation U or Regulation X.

       

       

      ARTICLE
6

      Defaults

       

      Section
6.01 .  Events of
Default.  If one or more of the following events (“Events of Default”) shall have
occurred and be continuing:

       

      (a) Principal and
Interest.  The Borrower shall (i) fail to pay when due
(whether upon stated maturity, by acceleration or otherwise) any principal of
any Loan or (ii) fail, and such failure shall continue uncured for five or
more Domestic Business Days, to pay when due (whether upon stated maturity, by
acceleration or otherwise) any interest on any Loan;

       

      (b) Other
Amounts.  The  Borrower shall fail to pay when due
any fee or other amount payable under this Agreement (including pursuant to
Section 2.09(b)) and such failure remains uncured for five (5) or more Domestic
Business Days after the due date thereof;

       

      (c) Covenants Without
Notice.  The Borrower shall fail to observe or perform any
covenant or agreement on its part to be observed or performed which is set forth
in Section 5.01 (only with respect to the Borrower’s corporate existence), 5.02,
5.09, 5.10, 5.12, 5.13, 5.14 or 5.15;

       

      (d) Covenants With 10 Days
Grace.  The Borrower shall fail to observe or perform any
covenant or agreement on its part to be observed or performed, which is set
forth in the last sentence of Section 5.04, or in Section 5.05, 5.06, 5.07,
5.08, and such non-observance or non-performance shall continue unremedied for a
period of more than 10 days;

       

      
        
          
          

        

        
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      (e) Other
Covenants.  The Borrower shall fail to observe or perform any
covenant, condition or agreement on its part to be observed or performed, other
than as referred to in subsections (a), (b), (c) and (d) above, for a period of
30 days after written notice specifying such failure and requesting that it be
remedied is given by any Bank to the Borrower and the other Banks; provided that, if the failure
be such that it cannot be corrected within the applicable period, but can be
corrected within a reasonable period of time thereafter, it shall not constitute
a Default if corrective action is instituted by the Borrower within the
applicable period and diligently pursued until the failure is corrected, but any
such failure that is not so corrected within 45 days after such applicable
period shall constitute a Default;

       

      (f) Representations.  Any
representation, warranty, certification or statement made or deemed to be made
by the Borrower in this Agreement or in any certificate, financial statement or
other document delivered pursuant to this Agreement shall prove to have been
incorrect in any material respect when made or deemed to be made;

       

      (g) Non-Payments of Indebtedness and/or
Derivatives Obligations.  The Borrower or any Subsidiary of the
Borrower shall fail to make any payment or payments aggregating for the Borrower
and its Subsidiaries in excess of $50,000,000 in respect of Indebtedness and/or
Derivatives Obligations of the Borrower or any Subsidiary (other than the Loans
or any Indebtedness under this Agreement) when due (whether upon stated
maturity, by acceleration or otherwise) or within any applicable grace
period;

       

      (h) Defaults Under Other
Agreements.  The Borrower or any Subsidiary shall fail to
observe or perform within any applicable grace period any covenant or agreement
contained in any agreement or instrument relating to any Indebtedness of the
Borrower or any Subsidiary, aggregating for the Borrower and its Subsidiaries in
excess of $50,000,000 if the effect of such failure is to accelerate, or to
permit the holder of such Indebtedness or any other Person to accelerate, the
maturity of such Indebtedness;

       

      (i) Bankruptcy.  Any
proceeding shall be instituted by or against the Borrower or any Subsidiary
seeking to adjudicate it bankrupt or insolvent, or seeking liquidation, winding
up, reorganization, arrangement, adjustment, protection, conservation or
proceeding in the nature thereof, relief or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief or
protection of debtors, or seeking the entry of an order for relief or the
appointment of a receiver (including state regulatory authorities acting in a
similar capacity), trustee, custodian or other similar official for it or for
any substantial part of its property, and, in the case of any such proceeding
instituted against it (but not instituted by it) shall remain undismissed or
unstayed for a period of 60 days; or the Borrower or any Subsidiary shall take
any action to authorize any of the actions set forth above in this subsection
(i);

       

      
        
          
          

        

        
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      (j) ERISA.  A Plan
shall fail to maintain the minimum funding standard required by Section 412 of
the Internal Revenue Code for any plan year or a waiver of such standard is
sought or granted under Section 412(d), or a Plan is, shall have been or is
likely to be terminated or the subject of termination proceedings under Section
4042 of ERISA, or the Borrower or a Subsidiary of the Borrower or any member of
the ERISA Group has incurred or is likely to incur a liability to or on account
of a Plan under Section 4062, 4063, 4064, 4201 or 4204 of ERISA, and there shall
result from any such event or events either a liability or a material risk of
incurring a liability to the PBGC or a Plan, which in the opinion of the
Required Banks, will have a material adverse effect upon the business, results
of operations or financial position of the Borrower; or

       

      (k) Money Judgment.  A
final judgment or order for the payment of money in excess of $50,000,000 shall
be rendered against the Borrower or any Subsidiary and such judgment or order
shall continue unsatisfied and in effect for a period of 45 days during which
execution shall not be effectively stayed or deferred (whether by action of a
court, by agreement or otherwise);

       

      (l) Insolvency.  The
Borrower or any Subsidiary shall generally not pay its debts as they become due,
or shall admit in writing its inability to pay its debts generally or shall make
a general assignment for the benefit of creditors;

       

      then, and
in any such event, and at any time thereafter, if any Event of Default shall
then be continuing, the Administrative Agent, upon the request of the Required
Banks, shall by notice to the Borrower, take any or all of the following
actions, without prejudice to the rights of the Administrative Agent, any Bank
or the holder of any Note to enforce its claims against the
Borrower:  (a) declare the Commitments terminated, whereupon the
Commitment of each Bank shall forthwith terminate immediately and any fee
payable pursuant to Section 2.09 shall forthwith become due and payable without
any other notice of any kind; and/or (b) declare the principal of and accrued
interest on the Loans, and all other obligations owing hereunder, to be,
whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower; provided
that, if an Event of Default specified in subsection (i) shall occur, the result
which would occur upon the giving of written notice by the Administrative Agent
to the Borrower, as specified in clauses (a) and (b) above, shall occur
automatically without the giving of any such notice.

       

      Section
6.02 .  Notice of
Default.  The Administrative Agent shall give notice to the
Borrower under Section 6.01(e) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.

       

      
        
          
          

        

        
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      ARTICLE
7

      The
Administrative Agent

       

      Section
7.01 .  Appointment and
Authorization.  Each Bank irrevocably appoints and authorizes
the Administrative Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the Notes as are delegated to the
Administrative Agent by the terms hereof or thereof, together with all such
powers as are reasonably incidental thereto.

       

      Section
7.02 .  Administrative Agent and
Affiliates.  The Bank of Nova Scotia shall have the same rights
and powers under this Agreement as any other Bank and may exercise or refrain
from exercising the same as though it were not the Administrative Agent, and The
Bank of Nova Scotia and its affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrower or any Subsidiary
or affiliate of the Borrower as if it were not the Administrative Agent
hereunder.

       

      Section
7.03 .  Action by Administrative
Agent.  The obligations of the Administrative Agent hereunder
are only those expressly set forth herein.  Without limiting the
generality of the foregoing, the Administrative Agent shall not be required to
take any action with respect to any Default, except as expressly provided in
Article 6.

       

      Section
7.04 .  Consultation with
Experts.  The Administrative Agent may consult with legal
counsel (who may be counsel for the Borrower), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the advice of such
counsel, accountants or experts.

       

      Section
7.05 .  Liability of Administrative
Agent.  Neither the Administrative Agent nor any of its
affiliates nor any of their respective directors, officers, agents, or employees
shall be liable for any action taken or not taken by it in connection herewith
(i) with the consent or at the request of the Required Banks or (ii) in the
absence of its own gross negligence or willful misconduct.  Neither
the Administrative Agent nor any of its affiliates nor any of their respective
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify (i) any statement, warranty or
representation made in connection with this Agreement or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of the Borrower; (iii) the satisfaction of any condition specified in
Article 3, except receipt of items required to be delivered to the
Administrative Agent; or (iv) the validity, effectiveness or genuineness of this
Agreement, the Notes or any other instrument or writing furnished in connection
herewith.  The Administrative Agent shall not incur any liability by
acting in reliance upon any notice, consent, certificate, statement, or other
writing (which may be a bank wire, telex or similar writing) reasonably believed
by it to be genuine or to be signed by the proper party or parties.

       

      
        
          
          

        

        
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      Section
7.06 .  Indemnification.  Each
Bank shall, ratably in accordance with the sum of (i) its unused Commitment and
(ii) any Loans outstanding of such Bank, indemnify the Administrative Agent, its
affiliates and their respective directors, officers, agents and employees (to
the extent not reimbursed by the Borrower) against any cost, expense (including
counsel fees and disbursements), claim, demand, loss, damages or liability
(except such as result from such indemnitee’s gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection with this
Agreement or any action taken or omitted by such indemnitees
hereunder.

       

      Section
7.07 .  Credit
Decision.  Each Bank acknowledges that it has, independently
and without reliance upon the Administrative Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement.  Each Bank
also acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking any action under this
Agreement.

       

      Section
7.08 .  Successor Administrative
Agent.  The Administrative Agent may, and for so long as long
as no Event of Default has occurred and is continuing, at the request of the
Borrower, shall, resign at any time by giving written notice thereof to the
Banks and the Borrower.  Upon any such resignation, the Borrower shall
have the right, with the consent of the Required Banks, such consent not to be
unreasonably withheld, to appoint a successor Administrative
Agent.  If no successor Administrative Agent shall have been so
appointed by the Borrower, and shall have accepted such appointment, within 15
days after the retiring Administrative Agent gives notice of resignation, then
the retiring Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, which shall be a commercial bank organized or
licensed under the laws of the United States of America or of any State thereof
and having a combined capital and surplus of at least
$1,000,000,000.  Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder.  After any retiring Administrative Agent’s resignation
hereunder as Administrative Agent, the provisions of this Article shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent.

       

      Section
7.09 .  Co-Documentation Agents and
Syndication Agent Not Liable.  Nothing in this Agreement shall
impose upon any Co-Documentation Agent or the Syndication Agent, each in such
capacity, any duties or responsibilities whatsoever.

       

      
        
          
          

        

        
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      ARTICLE
8

      Change
in Circumstances

       

      Section
8.01 .  Basis for Determining Interest Rate
Inadequate or Unfair.  If on or prior to the first day of any
Interest Period for any Fixed Rate Borrowing:

       

      (a) the
Administrative Agent is advised by the Euro-Dollar Reference Banks that the
London Interbank Offered Rate is not available in the manner set forth in the
definition of London Interbank Offered Rate for such Interest Period,
or

       

      (b) in the
case of a Committed Borrowing, Banks having 50% or more of the aggregate amount
of the Commitments advise the Administrative Agent that the Adjusted London
Interbank Offered Rate, as determined by the Administrative Agent, will not
adequately and fairly reflect the cost to such Banks of funding their
Euro-Dollar Loans for such Interest Period,

       

      the
Administrative Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Administrative Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, (i) the
obligations of the Banks to make Euro-Dollar Loans or to continue or convert
outstanding Loans as or into Euro-Dollar Loans shall be suspended and (ii) each
outstanding Euro-Dollar Loan shall be converted into a Base Rate Loan on the
last day of the then current Interest Period applicable
thereto.  Unless the Borrower notifies the Administrative Agent at
least two Domestic Business Days before the date of any Fixed Rate Borrowing for
which a Notice of Borrowing has previously been given that it elects not to
borrow on such date, (i) if such Fixed Rate Borrowing is a Euro-Dollar
Borrowing, such Borrowing shall instead be made as a Base Rate Borrowing and
(ii) if such Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the Money
Market LIBOR Loans comprising such Borrowing shall bear interest for each day
from and including the first day to but excluding the last day of the Interest
Period applicable thereto at the Base Rate for such day.

       

      Section
8.02 .  Illegality.  If, on
or after the date of this Agreement, the adoption of any applicable law, rule or
regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Euro-Dollar Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall make it unlawful or impossible for any Bank (or its
Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar Loans and
such Bank shall so notify the Administrative Agent, the Administrative Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Administrative Agent
that the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans or to convert outstanding
Loans into Euro-Dollar Loans or continue outstanding Loans as Euro-

       

      
        
          
          

        

        
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      Dollar
Loans, shall be suspended.  Before giving any notice to the
Administrative Agent pursuant to this Section, such Bank shall designate a
different Euro-Dollar Lending Office if such designation will avoid the need for
giving such notice and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. The Borrower hereby agrees to pay the reasonable
costs and expenses incurred by such Bank in connection with any such
designation. If such Bank shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Euro-Dollar Loans to maturity and shall
so specify in such notice, the Borrower shall immediately prepay in full the
then-outstanding principal amount of each such Euro-Dollar Loan, together with
accrued interest thereon.  Concurrently with prepaying each such
Euro-Dollar Loan, the Borrower shall borrow a Base Rate Loan in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other
Banks), and such Bank shall make such a Base Rate Loan.

       

      Section
8.03 .  Increased Cost and Reduced
Return.  (a) If on or after (x) the date hereof, in the
case of any Committed Loan or any obligation to make Committed Loans or (y) the
date of the related Money Market Quote, in the case of any Money Market Loan,
the adoption of any applicable law, rule or regulation, or any change therein,
or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable
agency:

       

      (i) shall
subject any Bank (or its Applicable Lending Office) to any tax, duty or other
charge with respect to its Fixed Rate Loans, its Notes or its obligation to make
Fixed Rate Loans, or shall change the basis of taxation of payments to any Bank
(or its Applicable Lending Office) of the principal of or interest on its Fixed
Rate Loans or any other amounts due under this Agreement in respect of its Fixed
Rate Loans or its obligation to make Fixed Rate Loans (except for changes in the
rate of tax on the overall net income of such Bank or its Applicable Lending
Office imposed by the jurisdiction in which such Bank’s principal executive
office or Applicable Lending Office is located); or

       

      (ii) shall
impose, modify or deem applicable any reserve (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding with respect to any Euro-Dollar Loan any such requirement
included in an applicable Euro-Dollar Reserve Percentage), special deposit,
insurance assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Bank (or its Applicable Lending
Office) or shall impose on any Bank (or its Applicable Lending Office) or the
London interbank market any other condition affecting its Fixed Rate Loans, its
Notes or its obligation to make Fixed Rate Loans; and the result of any of

       

      
        
          
          

        

        
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      the
foregoing is to increase the cost to such Bank (or its Applicable Lending
Office) of making or maintaining any Fixed Rate Loan, or to reduce the amount of
any sum received or receivable by such Bank (or its Applicable Lending Office)
under this Agreement or under its Note with respect thereto, by an amount deemed
by such Bank to be material,

       

      then,
within 15 days after demand by such Bank (with a copy to the Administrative
Agent), the Borrower shall pay to such Bank such additional amount or amounts as
will compensate such Bank for such increased cost or reduction (including any
amount or amounts equal to any taxes on the overall net income of such Bank
payable by such Bank with respect to the amount of payments required to be made
pursuant to this Section 8.03(a)).

       

      (b) If any
Bank determines that the adoption of any applicable law, rule, regulation,
guideline or request concerning capital adequacy, or any change therein, or any
change in interpretation or administration thereof by any governmental
authority, central bank or comparable agency (including, without limitation, any
such adoption or change the effect of which would be, for purposes of capital
adequacy requirements, to treat the Commitments hereunder as not constituting
commitments with an original maturity of one year or less), occurring after the
date hereof, will have the effect of increasing the amount of capital required
or expected to be maintained by such Bank based on the existence of such Bank’s
Commitment hereunder or its obligations hereunder, it will notify the
Borrower.  This determination will be made on a Bank-by-Bank
basis.  The Borrower will pay to each Bank on demand such additional
amounts as are necessary to compensate for the increased cost to such Bank as a
result of the event described in the first sentence of this Section
8.03(b).  In determining such amount, such Bank will act reasonably
and in good faith and will use averaging and attribution methods which are
reasonable, and such Bank will pass such costs on to the Borrower only if such
costs are passed on in a similar manner by such Bank to similarly situated
borrowers (which are parties to credit or loan documentation containing a
provision similar to this Section 8.03(b)), as determined by such Bank in its
reasonable discretion.  Each Bank’s determination of compensation
shall be conclusive if made in accordance with this provision.  Each
Bank, upon determining that any increased costs will be payable pursuant to this
Section 8.03(b), will give prompt written notice thereof to the Borrower, which
notice shall show the basis for calculation of such increased costs, although
the failure to give any such notice shall not release or diminish any of the
Borrower’s obligations to pay increased costs pursuant to this Section
8.03(b).

       

      (c) Each Bank
will promptly notify the Borrower and the Administrative Agent of any event of
which it has knowledge, occurring after the date hereof, which will entitle such
Bank to compensation pursuant to this Section and will designate a different
Applicable Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank.  The Borrower hereby agrees to
pay the reasonable costs and expenses incurred by such Bank in connection with
any such designation. A Bank claiming 

       

      
        
          
          

        

        
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      compensation
under this Section shall furnish a certificate to the Borrower setting forth the
additional amount or amounts to be paid to it hereunder, which shall be
conclusive in the absence of manifest error.  In determining such
amount, such Bank may use any reasonable averaging and attribution
methods.

       

      (d) Failure
or delay on the part of any Bank to demand compensation pursuant to this Section
8.03 shall not constitute a waiver of such Bank’s right to demand such
compensation; provided
that the Borrower shall not be required to compensate any Bank pursuant to this
Section 8.03 for any increased costs or reductions incurred more than six months
prior to the date that such Bank notifies the Borrower and the Administrative
Agent of the circumstances giving rise to such increased costs or reductions and
of such Bank’s intention to claim compensation therefor; provided, further, that, if
the circumstances giving rise to such increased costs or reductions are
retroactive, then the six-month period referred to above shall be extended to
include the period of retroactive effect thereof.

       

      Section
8.04 .  Base Rate Loans Substituted for
Affected Euro-Dollar Loans.  If (i) the obligation of any Bank
to make, or to continue or convert outstanding Loans as or to, Euro-Dollar Loans
has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03(a) and the Borrower shall, by at least five
Euro-Dollar Business Days’ prior notice to such Bank through the Administrative
Agent, have elected that the provisions of this Section shall apply to such
Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:

       

      (a) all Loans
which would otherwise be made by such Bank as Euro-Dollar Loans shall be made
instead as Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks),
and

       

      (b) after
each of its Euro-Dollar Loans has been repaid, all payments of principal which
would otherwise be applied to repay such Euro-Dollar Loans shall be applied to
repay its Base Rate Loans instead.

       

       

      ARTICLE
9

      Miscellaneous

       

      Section
9.01 .  Notices.  (a) All
notices, requests, directions, consents, approvals and other communications to
any party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party (subject to
subparagraph (b) below):  (w) in the case of the
Borrower:

       

      National
Rural Utilities Cooperative Finance Corporation

      2201
Cooperative Way

       

      
        
          
          

        

        
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      Herndon,
Virginia  20171

      Attn:
Capital Markets Relations

      Phone:
(800) 424-2954, ext. 2044

      Fax:
(703) 709-6784

      Email:
BankingRelations@nrucfc.coop,

       

      (x) in
the case of the Administrative Agent, at its address or telex or telecopier
number set forth on the signature pages hereof, (y) in the case of any Bank, at
its address or telex or telecopier number set forth in its Administrative
Questionnaire or (z) in the case of any other party, such other address or telex
or telecopier number as such party may hereafter specify for the purpose by
notice to the Administrative Agent and the Borrower.  Each such
notice, request, direction, consent, approval or other communication shall be
effective (i) if given by telex, when such telex is transmitted to the telex
number specified in this Section and the appropriate answerback is received or
(ii) if given by any other means, when delivered or received at the address
specified in this Section; provided that notices to the
Administrative Agent under Article 2 or Article 8 shall not be effective until
received.

       

      (b) Notices
and other communications to the Banks hereunder may be delivered or furnished by
electronic communications pursuant to procedures approved by the Administrative
Agent; provided that
the foregoing shall not apply to notices pursuant to Article 2 or Article 8
unless otherwise agreed by the Administrative Agent and the applicable
Bank.  The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that approval of
such procedures may be limited to particular notices or
communications.

       

      Section
9.02 .  No Waivers.  No
failure or delay by the Administrative Agent or any Bank in exercising any
right, power or privilege hereunder or under any Note shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by
law.

       

      Section
9.03 .  Expenses; Documentary Taxes;
Indemnification.  (a) The Borrower shall pay (i) all
documented reasonable out-of-pocket expenses of the Administrative Agent,
including reasonable fees and disbursements of special counsel for the
Administrative Agent, in connection with the preparation of this Agreement, any
waiver or consent hereunder or any amendment hereof or any Default or alleged
Default hereunder and (ii) if an Event of Default occurs, all documented
reasonable out-of-pocket expenses incurred by the Administrative Agent or any
Bank, including reasonable fees and disbursements incurred by counsel or
in-house counsel, in connection with such Event of Default and collection,
bankruptcy, insolvency and other enforcement proceedings resulting
therefrom.  The Borrower shall indemnify each Bank against any
transfer taxes, documentary taxes, assessments or charges made by any
governmental authority 

       

      
        
          
          

        

        
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      by reason
of the execution and delivery of this Agreement or the Notes and any and all
liabilities with respect to or resulting from any delay or omission (unless
solely attributable to such Bank) to pay such taxes.

       

      (b) The
Borrower agrees to indemnify each Bank, their respective affiliates and the
respective directors, officers and employees of the foregoing (each an “Indemnitee”) and hold each
Indemnitee harmless from and against any and all liabilities, losses, damages,
costs, claims, demands and expenses of any kind, including, without limitation,
the reasonable fees and disbursements of counsel, which may be incurred by any
Indemnitee (or by the Administrative Agent in connection with its actions as
Agent hereunder) in connection with any investigative, administrative or
judicial proceeding (whether or not such Indemnitee shall be designated a party
thereto) relating to or arising out of this Agreement or any actual or proposed
use of proceeds of Loans hereunder; provided that no Indemnitee
shall have the right to be indemnified hereunder for its own gross negligence,
willful misconduct or unlawful conduct as determined by a court of competent
jurisdiction.

       

      Section
9.04 .  Sharing of
Set-offs.  Each Bank agrees that if it shall, by exercising any
right of set-off or counterclaim or otherwise, receive payment of a proportion
of the aggregate amount of principal and interest then due with respect to any
Loans made by it which is greater than the proportion received by any other Bank
in respect of the aggregate amount of principal and interest due with respect to
any Loans made by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Loans held by the
other Banks, and such other adjustments shall be made, as may be required so
that all such payments of principal and interest with respect to the Loans held
by the Banks shall be shared by the Banks pro rata; provided that nothing in this
Section shall impair the right of any Bank to exercise any right of set-off or
counterclaim it may have and to apply the amount subject to such exercise to the
payment of indebtedness of the Borrower other than its indebtedness under the
Loans.  The Borrower agrees, to the fullest extent it may effectively
do so under applicable law, that any holder of a participation in a Loan,
whether or not acquired pursuant to the foregoing arrangements, may exercise
rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.

       

      Section
9.05 .  Amendments and
Waivers.  Except as provided by Section 2.17, any provision of
this Agreement or the Notes may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Borrower and the Required
Banks (and, if the rights or duties of the Administrative Agent are affected
thereby, by the Administrative Agent); provided that, no such
amendment or waiver shall (i) increase the Commitment of any Bank or subject any
Bank to any additional obligation without the written consent of such Bank,
(ii) reduce the principal of or rate of interest on any Loan or any fees
hereunder without the written consent of each Bank directly affected thereby,
(iii) postpone the date fixed for any payment of principal of or interest on any
Loan or any fees 

       

      
        
          
          

        

        
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      hereunder
without the written consent of each Bank directly affected thereby, (iv) change
the aggregate unpaid principal amount of the Notes without the written consent
of each Bank directly affected thereby, (v) change any provision which requires
the pro rata sharing of payments among the Banks hereunder without the written
consent of each Bank directly affected thereby, (vi) change clauses (i) through
(vi) of this proviso to
this Section 9.05 or the definition of “Required Banks” (other than the
percentage indicated therein, which, for the avoidance of doubt, is subject to
clause (vii) below) without the written consent of each Bank (including,
notwithstanding Section 2.19(b), any Defaulting Bank) or (vii) modify or change
(x) the percentage indicated in the definition of “Required Banks” or (y)
subject to clause (vi) above, any other provision hereof specifying the number
or percentage of Banks required to waive, amend or modify any rights hereunder,
make any determination or grant any consent hereunder or take any other action
under any provision of this Agreement, without the written consent of each Bank
(excluding, for the avoidance of doubt, any Defaulting Bank to the extent of its
unfunded Commitment). For the avoidance of doubt, no consent or any other action
will be required of any Bank (other than the Defaulting Bank and the
Administrative Agent to the extent required by Section 2.18) for any assignment
of any Loans or termination of any Commitments pursuant to Section
2.18.

       

      Whenever
a waiver, amendment or modification requires the consent of a Bank “affected” or
“directly affected” thereby, such waiver, amendment or modification shall, upon
consent of such Bank, become effective as to such Bank whether or not it becomes
effective as to any other Bank, so long as the Required Banks consent to such
waiver, amendment or modification as provided above.

       

      If the
Required Banks shall have approved any amendment which requires the consent of
all of the Banks, the Borrower shall be permitted to replace any non-consenting
Bank with a replacement institution; provided that (i) the
replacement institution shall purchase at par all Loans and other amounts owing
to such replaced Bank on or prior to the date of replacement, (ii) the Borrower
shall be liable to such replaced Bank under Section 2.13 if any Euro-Dollar Loan
owing to such replaced Bank shall be purchased other than on the last day of the
Interest Period relating thereto (as if such purchase constituted a prepayment
of such Loans), (iii) such replacement institution, if not already a Bank, shall
be reasonably satisfactory to the Administrative Agent, (iv) the replaced Bank
shall be obligated to make such replacement in accordance with the provisions of
Section 9.06(c) and (v) any such replacement shall not be deemed to be a waiver
of any rights the Borrower, Administrative Agent or any Bank shall have against
the replaced Bank.

       

      Section
9.06 .  Successors and
Assigns.  (a) The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign or otherwise
transfer any of its rights under this Agreement without the prior written
consent of all Banks.

       

      
        
          
          

        

        
          57

          
            

          

        

        
          
          

        

      

      (b) Any Bank
may at any time grant to one or more affiliates of such Bank, banks or other
institutions (each a “Participant”) participating
interests in its Commitment or any or all of its Loans.  In the event
of any such grant by a Bank of a participating interest to a Participant,
whether or not upon notice to the Borrower and the Administrative Agent, such
Bank shall remain responsible for the performance of its obligations hereunder,
and the Borrower and the Administrative Agent shall continue to deal solely and
directly with such Bank in connection with such Bank’s rights and obligations
under this Agreement.  Any agreement pursuant to which any Bank may
grant such a participating interest shall provide that such Bank shall retain
the sole right and responsibility to enforce the obligations of the Borrower
hereunder including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
participation agreement may provide that such Bank will not agree to any
modification, amendment or waiver of this Agreement described in clauses (i),
(ii) or (iii) of Section 9.05 without the consent of the
Participant.  Subject to the provisions of subsection (e), the
Borrower agrees that each Participant shall, to the extent provided in its
participation agreement, be entitled to the benefits, and be bound by the
obligations, of Article 8 with respect to its participating
interest.  An assignment or other transfer which is not permitted by
subsection (c) or (d) below shall be given effect for purposes of this Agreement
only to the extent of a participating interest granted in accordance with this
subsection (b).

       

      (c) Any Bank
may at any time assign to one or more banks or other institutions (each an
“Assignee”) all, or a
proportionate part (but not in any case in an amount less than $10,000,000,
unless (x) such Assignee is another Bank or an affiliate of such transferor Bank
or (y) such assignment is for all of such transferor Bank’s rights and
obligations under this Agreement and the Notes) of all of its rights and
obligations under this Agreement and the Notes, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit G hereto executed by such Assignee and such
transferor Bank, with (and subject to) the subscribed consent of the Borrower
and the Administrative Agent, such consents not to be unreasonably withheld;
provided that (i) if an
Assignee is another Bank or an affiliate of such transferor Bank, or (ii) in the
case of an assignment by any Bank to one or more Assignees after the occurrence
and during the continuance of an Event of Default, no such consent of the
Borrower shall be required; and provided further that such assignment
may, but need not, include the rights of the transferor Bank in respect of
outstanding Money Market Loans.  Upon execution and delivery of such
an instrument and payment by such Assignee to such transferor Bank of an amount
equal to the purchase price agreed between such transferor Bank and such
Assignee, such Assignee shall be a Bank party to this Agreement and shall have
all the rights and obligations of a Bank with a Commitment as set forth in such
instrument of assumption, and the transferor Bank shall be released from its
obligations hereunder to a corresponding extent, and no further consent or
action by any party shall be required.  Upon the consummation of any
assignment pursuant to this subsection (c), the transferor Bank, the
Administrative Agent and the Borrower shall make appropriate arrangements so
that, if required, 

       

      
        
          
          

        

        
          58

          
            

          

        

        
          
          

        

      

      a new
Note is issued to the Assignee.  In connection with any such
assignment, the transferor Bank shall pay to the Administrative Agent an
administrative fee for processing such assignment in the amount of
$3,500.  If the Assignee is not incorporated under the laws of the
United States of America or a state thereof, it shall, prior to the first date
on which interest or fees are payable hereunder for its account, deliver to the
Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 2.16.

       

      (d) Any Bank
may at any time assign all or any portion of its rights under this Agreement and
its Note to a Federal Reserve Bank.  No such assignment shall release
the transferor Bank from its obligations hereunder.

       

      (e) No
Assignee, Participant or other transferee of any Bank’s rights shall be entitled
to receive any greater payment under Section 8.03 than such Bank would have been
entitled to receive with respect to the rights transferred, unless such transfer
is made with the Borrower’s prior written consent.

       

      Section
9.07 .  Collateral.  Each
of the Banks represents to the Administrative Agent and each of the other Banks
that it in good faith is not relying upon any “margin stock” (as defined in
Regulation U) as collateral in the extension or maintenance of the credit
provided for in this Agreement.

       

      Section
9.08 .  Governing Law.  (a)
This Agreement and each Note shall be governed by and construed in accordance
with the laws of the State of New York.

       

      (b) The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of the Supreme Court of the State of
New York sitting in New York County and of the United States District Court of
the Southern District of New York, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court.  Each of the
parties hereto agrees, to the fullest extent permitted by law, that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this Agreement shall affect any right
that the Administrative Agent or any Bank may otherwise have to bring any action
or proceeding relating to this Agreement against the Borrower or its properties
in the courts of any jurisdiction.

       

      (c) The
Borrower hereby irrevocably and unconditionally waives, to the fullest

       

      
        
          
          

        

        
          59

          
            

          

        

        
          
          

        

      

      extent it
may legally and effectively do so, any objection which it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement in any court referred to in paragraph (b) of this
Section.  Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

       

      (d) Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 9.01.  Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.

       

      Section
9.09 .  Counterparts;
Integration.  This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.  This
Agreement constitutes the entire agreement and understanding among the parties
hereto and supersedes any and all prior agreements and understandings, oral or
written, relating to the subject matter hereof.

       

      Section
9.10 .  Several
Obligations.  The obligations of the Banks hereunder are
several.  Neither the failure of any Bank to carry out its obligations
hereunder nor of this Agreement to be duly authorized, executed and delivery by
any Bank shall relieve any other Bank of its obligations hereunder (or affect
the rights hereunder of such other Bank).  No Bank shall be
responsible for the obligations of, or any action taken or omitted by, any other
Bank hereunder.

       

      Section
9.11 .  Severability.  In
case any provision in or obligation under this Agreement shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and
enforceability of the remaining provisions or obligations, or of such provision
or obligation in any other jurisdiction, shall not in any way be affected or
impaired thereby.

       

      Section
9.12 .  Confidentiality.  The
Administrative Agent and each Bank represent that they will maintain the
confidentiality of any written or oral information provided by or on behalf of
the Borrower (hereinafter collectively called “Confidential Information”),
subject to the Administrative Agent’s and each Bank’s (a) obligation to
disclose any such Confidential Information pursuant to a request or order under
applicable laws or regulations or from a regulatory authority or pursuant to a
subpoena or other legal process, (b) right to disclose any such
Confidential Information to its bank examiners, auditors, counsel and other
professional advisors, and its employees, officers and directors, and to other
Banks (it being understood that such Persons shall be informed of the
confidential nature of such information and instructed to keep it
confidential), (c) right to disclose any such Confidential Information in
connection with any litigation or dispute involving the Banks and the Borrower
or any of its Subsidiaries and affiliates, (d) right to provide such
information to Participants, prospective Participants to which sales of
participating interests are permitted pursuant to Section 9.06(b) and
prospective Assignees to which assignments of interests are permitted pursuant
to Section 9.06(c) if such Participant, prospective Participant or prospective
Assignee agrees in writing to maintain the confidentiality of such information
on terms substantially similar to those of this Section as if it were a “Bank”
party hereto, and (e) right to disclose Confidential Information to its

       

      
        
          
          

        

        
          60

          
            

          

        

        
          
          

        

      

      affiliates
if such affiliate agrees in writing to maintain the confidentiality of such
information on terms substantially similar to those of this
Section.  Notwithstanding the foregoing, any such information supplied
to a Bank, Participant, prospective Participant or prospective Assignee under
this Agreement shall cease to be Confidential Information if it is or becomes
known to such Person by other than unauthorized disclosure, or if it becomes a
matter of public knowledge other than as a result of a breach of this Section by
such Person.

       

      Section
9.13 .  WAIVER OF JURY
TRIAL.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

       

      Section
9.14 . USA Patriot
Act.  Each Bank hereby notifies the Borrower that pursuant to
the requirements of the USA PATRIOT Act (Title III of Pub. L 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Bank to identify the Borrower in accordance with the
Act.    

       

      Section
9.15 .  ICC
Transactions.  Notwithstanding anything to the contrary set
forth in this Agreement (without limiting the terms of the penultimate sentence
of this Section 9.15) or in any of the Notes or other instruments or documents
that have been or are in the future executed or delivered pursuant to, or that
otherwise relate to, this Agreement or to any Committed Borrowings or Loans
hereunder (all of the foregoing, collectively with this Agreement, the “Credit Documentation”),
(a) to the extent necessary under the Credit Documentation, the Banks
hereby consent to, and waive any Default, Event of Default or other breach,
violation, default or noncompliance with the provisions of the Credit
Documentation that might otherwise be caused by or be attributable to, the “ICC
Transactions” as such term is defined in Schedule 9.15 hereto, and (b) the ICC
Transactions, the “ICC Assets,” the “ICC Related Companies” (as such terms are
respectively defined in Schedule 9.15 hereto), and the assets, liabilities and
operations of the ICC Related Companies (including without limitation any
circumstances, events, occurrences, actions or omissions relating to, of or by
any of the ICC Related Companies), are hereby excluded from, and shall not be
taken into account in applying, interpreting or determining compliance with, the
provisions of the Credit Documentation (including without limitation, the
definitions, representations, warranties, covenants, agreements, conditions and
events of default set forth in the Credit Documentation) and may be excluded
from any certifications, notices, reports or statements delivered or to be
delivered pursuant to the Credit Documentation.  Without limiting the
generality of the foregoing, the defined terms “Controlled Subsidiary,”
“Consolidated Subsidiary Member,” “ERISA Group,” “Joint Venture,” “Member” and
“Subsidiary,” among others, as used in the Credit Documentation shall not
include the ICC Related Companies.  Notwithstanding the preceding
provisions of this Section 9.15, any new investments in the ICC Related
Companies by 

       

      
        
          
          

        

        
          61

          
            

          

        

        
          
          

        

      

      purchase
of equity and/or debt securities, funding (through capital contributions and/or
newly originated loans) of working capital or capital expenditure needs of the
ICC Related Companies, payment by RTFC or the Borrower of claims of other
creditors of the ICC Related Companies, and/or provision of any new guarantees,
letters of credit and/or other new credit support or credit enhancement of the
debt or other obligations of the ICC Related Companies, in the case of each of
the foregoing, made or provided by the Borrower and/or RTFC at any time from
December 9, 2008 shall not exceed in the aggregate (but without double-counting
any such new investments) $275,000,000 without the consent of the Required
Banks.  To the extent that the Credit Documentation provides that any
of the ICC Transactions may be implemented if certain advance notice thereof is
given, all such conditions or requirements of advance notice shall be deemed to
have been complied with and all such notices shall be deemed to have been duly
and timely given in accordance with the terms of the Credit
Documentation.

       

      

       

      [remainder
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          62

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

       

      
        
          	
                  NATIONAL
      RURAL UTILITIES

                    
      COOPERATIVE FINANCE

                    
      CORPORATION

                
	
                  By:

                	/s/
      STEVEN L. LILLY  
	
                  Name:
      Steven L. Lilly

                
	
                  Title:  
      Senior Vice President, Chief 

                      Financial
      Officer and Assistant 

                      Secretary-Treasurer

                   

                
	
                  Address:                   2201
      Cooperative Way

                  Herndon, Virginia
      20171

                  Attention:                 Steven
      L. Lilly

                     
      Title:                         
      Senior Vice President, Chief 

                                    
          Financial
      Officer and 

                                        
      Assistant Secretary-Treasurer

                  Telephone
      No.:        (703)
      709-6718

                  Telecopier
      No.:         (703)
      709-6779

                

        

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        
          	
                  THE
      BANK OF NOVA SCOTIA, as Administrative Agent and as a
  Bank

                
	
                  By:

                	/s/
      FRANK SANDLER  
	
                  Name:
      Frank Sandler

                
	
                  Title:
      Managing Director

                   

                
	
                  Address:  c/o
      GWS Loan Operations

                                   720
      King Street West, 2nd
      Floor

                                   Toronto,
      Ontario M5V 2T3

                  Attention:
      NYA Loan Operations

                  Telephone
      No.:  (212) 225-5706

                  Telecopier
      No.:   (212) 225-5708

                  E-mail:  tara_ramakin@scotiacapital.com

                                karen_lam@scotiacapital.com

                   

                

        

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      THE
      ROYAL BANK OF SCOTLAND 

                                        
      PLC, as Syndication Agent and as a 

                                        
      Bank

                                    
	By:  	/s/
      BELINDA TUCKER
	     Name:
      Belinda Tuker
	     Title:
      Senior Vice
President

                            

                          

                        

                      

                    

                  

                

              

            

          

           

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

      

      

      
        

        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        BANK
      OF AMERICA, N.A.,  as a Bank

                                         

                                      
	By:  	/s/
      RICHARD STEIN
	     Name:
      Richard Stein
	     Title:
      Senior Vice
President

                              

                            

                          

                        

                      

                    

                  

                

              

            

             

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          The
      Bank of Tokyo-Mitsubishi UFJ

                                          Ltd.,
      as Co-Documentaion Agent and a 

                                          Lender

                                           

                                        
	By:  	/s/
      NICHOLAS R. BATTISTA
	     Name:
      Nicholas R. Battista
	     Title:
      Authorizated
Signatory

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
         

        
          
            

            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    	
                                            Commerica Bank

                                             

                                          
	By:  	/s/
      MARK SKRZYNSKI
	     Name:
      Mark Skrzynski
	     Title:
      Corporate Banking
Officer

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

                 

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      
        
           

          
            
              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                              DEUTSCHE BANK AG NEW YORK

                                                 BRANCH, as a Bank

                                            
	By:  	/s/
      MARCUS TARKINGTON
	     Name:
      Marcus Tarkinton
	     Title:
      Director

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                   

                

              

            

          

        

      

      
        
           

          
            
              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                               

                                            
	By:  	/s/
      RAINER MEIER
	     Name:
      Rainer Meier
	     Title:
      Director

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                   

                

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          
             

            
              
                 

                
                  
                    

                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                    DEUTSCHE BANK SECURITIES

                                                       INC., as Co-Documentation
      Agent

                                                  
	By:  	/s/
      FREDERICK LAIRD
	     Name:
      Frederick Laird
	     Title:
      Managing
Director

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                         

                      

                    

                  

                

              

            

            
              
                 

                
                  
                    

                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                     

                                                  
	By:  	/s/
      RAINER MEIER
	     Name:
      Rainer Meier
	     Title:
      Director

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                         

                      

                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          JP
      Morgan Chase Bank, N.A., as a Bank

                                           

                                        
	By:  	/s/
      MICHAEL DEFORGE
	     Name:
      Michael Deforge
	     Title:
      Excutive
Director

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      
        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          KEYBANK NATIONAL

                                             ASSOCIATION, as
      a Bank

                                        
	By:  	/s/
      SHERRIE I. MANSON
	     Name:
      Sherrie I. Manson
	     Title:
      Senior Vice
President

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          Mizuho Corporate
      Bank, Ltd., as a Bank

                                           

                                        
	By:  	/s/
      RAYMOND VENTURA
	     Name:
      Raymond Ventura
	     Title:
      Deputy General
Manager

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

        
          

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                 

                                
                                  	
                                          PNC
      Bank, N.A., as a Bank

                                           

                                        
	By:  	/s/
      D. JERMAINE JOHNSON
	     Name:
      D. Jermaine Johnson
	     Title:
      Vice
President

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
         

        
          
            
              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                              UBS
      Loan Finance LLC, as a Bank

                                               

                                            
	By:  	/s/
      IRJA R. OTSA
	     Name:
      Irja R. Otsa
	     Title:
      Associate
Director

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                   

                

              

            

          

          
            
               

              
                
                  

                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          	
                                                   

                                                   

                                                
	By:  	/s/
      MARY E. EVANS
	     Name:
      Mary E. Evans
	     Title:
      Associate
Director

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                       

                      
                        
                          
                          

                        

                        
                          
                          

                          
                            

                          

                        

                        
                          
                          

                        

                      

                    

                  

                

              

            

          

        

      

      
        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                               

                                               

                                            
	By:  	/s/
      FELICIA LA FORGIA
	     U.S.
      Bank National Association
	     Name:
      Felicia La Forgia
	     Title:
      Senior Vice
President

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

       

       

      AGENT
SCHEDULE

      

      

      
        
          
            
              
                
                  
                    
                      	
                              Institution

                            	
                              Title

                            
	
                              The
      Bank of Nova Scotia

                            	
                              Administrative
      Agent

                            
	
                              The
      Royal Bank of Scotland plc

                            	
                              Syndication
      Agent

                            
	
                              Deutsche
      Bank Securities Inc.

                            	
                              Co-Documentation
      Agent

                            
	
                              UBS
      Loan Finance LLC

                            	
                              Co-Documentation
      Agent

                            
	
                              The
      Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch

                            	
                              Co-Documentation
      Agent

                            

                    

                  

                

              

            

          

        

      

      

      

       

      
        
          
          

        

        
          Agent Schedule

          
            

          

        

        
          
          

        

      

       

      COMMITMENT
SCHEDULE

       

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      Institution

                                    	
                                      Commitment

                                    
	
                                      The
      Bank of Nova Scotia

                                    	
                                      $159,750,000

                                    
	
                                      The
      Royal Bank of Scotland plc

                                    	
                                      $159,750,000

                                    
	
                                      JPMorgan
      Chase Bank, N.A.

                                    	
                                      $100,000,000

                                    
	
                                      Deutsche
      Bank Securities Inc.

                                    	
                                      $100,000,000

                                    
	
                                      Bank
      of America, N.A.

                                    	
                                      $90,500,000

                                    
	
                                      Mizuho
      Corporate Bank, Ltd.

                                    	
                                      $75,000,000

                                    
	
                                      U.S.
      Bank National Association

                                    	
                                      $75,000,000

                                    
	
                                      UBS
      Loan Finance LLC

                                    	
                                      $75,000,000

                                    
	
                                      KeyBank
      National Association

                                    	
                                      $60,000,000

                                    
	
                                      The
      Bank of Tokyo-Mitsubishi UFJ, Ltd.

                                    	
                                      $50,000,000

                                    
	
                                      PNC
      Bank, National Association

                                    	
                                      $35,000,000

                                    
	
                                      Comerica
      Bank

                                    	
                                      $20,000,000

                                    
	 
      	 
      
	 
      	
                                      1,000,000,000

                                    

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      

      

      
        
          
          

        

        
          Commitment Schedule

          
            

          

        

        
          
          

        

      

      PRICING
SCHEDULE

       

      The
“Euro-Dollar Margin”
shall mean, for any Interest Period for any Euro-Dollar Loan, 100% of the
Borrower’s one-year credit default swap mid-rate spread based on the trading
convention credit default swap curve (i.e. the most liquid and/or widely
followed credit default swap curve for the Borrower’s senior unsecured debt
obligations)(as provided by Markit Group Limited) for the one-year period
beginning on the date two business days prior to the first day of such Interest
Period; provided that
the Euro-Dollar Margin shall in no event be less than the Applicable Euro-Dollar
Margin set forth below. The Euro-Dollar Margin will be (i) obtained by the
Administrative Agent from the Markit Group Limited website (with a copy of the
screen of such website displaying such credit default swap mid-rate spread to be
promptly provided by the Administrative Agent to the Borrower) and (ii) set for
each Euro-Dollar Loan at the time that the Euro-Dollar Rate applicable to each
Interest Period for such Loan is set. In the event that the Euro-Dollar Margin
is not available from Markit Group Limited (or similar reporting service in lieu
of Markit Group Limited as reasonably selected by the Administrative Agent with
the prior written consent of the Borrower), the Euro-Dollar Margin will be the
Applicable Euro-Dollar Margin set forth below.

       

      The
“Base Rate Margin” shall
mean, for any Interest Period for any Base Rate Loan, 100% of the Borrower’s
one-year credit default swap mid-rate spread based on the trading convention
credit default swap curve (i.e. the most liquid and/or widely followed credit
default swap curve for the Borrower’s senior unsecured debt obligations)(as
provided by Markit Group Limited) for the one-year period beginning on the date
two business days prior to the first day of such Interest Period less 1.000%; provided that the Base Rate
Margin shall in no event be less than the Applicable Base Rate Margin set forth
below. The Base Rate Margin will be (i) obtained by the Administrative Agent
from the Markit Group Limited website (with a copy of the screen of such website
displaying such credit default swap mid-rate spread to be promptly provided by
the Administrative Agent to the Borrower) and (ii) set for each Base Rate Loan
at the time that the Base Rate applicable to each Interest Period for such Loan
is set. In the event that the Base Rate Margin is not available from Markit
Group Limited (or similar reporting service in lieu of Markit Group Limited as
reasonably selected by the Administrative Agent with the prior written consent
of the Borrower), the Base Rate Margin will be the Applicable Base Rate Margin
set forth below.

       

      The
“Applicable Euro-Dollar
Margin”, “Applicable Base Rate Margin” and the
“Facility Fee Rate” for
the Borrower at any date are the respective percentages set forth below in the
applicable row and column based upon the Status of the Borrower that exists on
such date.

       

      
        
          	
                  Status

                	
                  Level
      I

                	
                  Level
      II

                	
                  Level
      III

                	
                  Level
      IV

                
	
                  Applicable
      Euro-Dollar Margin:

                	
                  1.400%

                	
                  1.625%

                	
                  1.800%

                	
                  2.125%

                

        

      

       

       

      
        
          Pricinig
Schedule

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          	 
      	 
      	 
      	 
      	 
      
	
                  Applicable
      Base Rate Margin

                	
                  0.400%

                	
                  0.625%

                	
                  0.800%

                	
                  1.125%

                
	
                  Facility
      Fee Rate:

                	
                  0.100%

                	
                  0.125%

                	
                  0.200%

                	
                  0.375%

                

        

      

       

       

       

      For
purposes of this Pricing Schedule, the following terms have the following
meanings, subject to the concluding paragraph of this Pricing
Schedule:

       

      “Fitch” means Fitch Ratings
Ltd.

       

      “Level I Status” exists at any
date if, at such date, the Borrower’s senior unsecured long-term debt is rated
A+ or higher by S&P or A1 or higher by Moody’s or A+ or higher by
Fitch.

       

      “Level II Status” exists at any
date if, at such date, (i) the Borrower’s senior unsecured long-term debt is
rated A or higher by S&P or A2 or higher by Moody’s or A or higher by Fitch,
and (ii) Level I Status does not exist.

       

      “Level III Status” exists at
any date if, at such date, (i) the Borrower’s senior unsecured long-term debt is
rated A- or higher by S&P or A3 or higher by Moody’s or A- or higher by
Fitch, and (ii) Level II Status does not exist.

       

      “Level IV Status” exists at any
date if, at such date, no other Status applies.

       

      “Moody’s” means Moody’s
Investors Services, Inc.

       

      “Rating Agencies” means each of
S&P, Moody’s and Fitch.

       

      “S&P” means Standard &
Poor’s Rating Services.

       

      “Status” refers to the
determination of which of Level I Status, Level II Status, Level III Status or
Level IV Status exists at any date.

       

      The
credit ratings to be utilized for purposes of this Pricing Schedule are those
assigned to the senior unsecured long-term debt securities of the
Borrower  without third-party credit enhancement (the “Borrower’s Unsecured Long-Term
Debt”), and any ratings assigned to any other debt security of the
Borrower shall be disregarded; provided that if at any date
there is no such rating assigned by a particular Rating Agency, such Rating
Agency’s rating of the Borrower’s Unsecured Long-Term Debt shall be deemed to be
one notch below such Rating Agency’s rating of the senior secured debt of the
Borrower at such date.  If two of the three Rating Agencies have
assigned the same rating to the Borrower’s Unsecured Long-Term Debt (after
giving effect to the proviso in the first sentence of this paragraph) and the
third rating agency has assigned a different rating, the rating of the third
Rating Agency shall be disregarded (e.g., A/A2/A+ results in
Level II Status).  If each Rating Agency has assigned to the
Borrower’s

       

      
         

        
          
            Pricinig
Schedule

          

          
            
            

            
              

            

          

          
            
            

          

        

         

      

       

       Unsecured
Long-Term Debt a different rating, the intermediate rating shall be used (e.g., A+/A2/A- results in
Level II Status).

       

      

      
         

        
          
            Pricing
Schedule

          

          
            
            

            
              

            

          

          
            
            

          

        

         

      

       

      SCHEDULE
5.03(a)

       

      NON-GAAP
SUBSIDIARIES

       

      

      
        	
                a.  

              	
                Denton
      Realty Holdings, LLC, organized in the State of Delaware. Borrower owns
      100% of the membership interests.

              

      

      

      
        	
                b.  

              	
                Denton
      Realty Investors, LLC, organized in the State of Delaware. Borrower owns
      100% of the membership interests.

              

      

      

      
        	
                c.  

              	
                Denton
      Realty Partners, LP, organized in the State of Delaware. Denton Realty
      Holdings, LLC is the general partner and owns 0.5% of the partnership
      interests, and Denton Realty Investors, LLC is the limited partner and
      owns 99.5% of the partnership
interests.

              

      

      

      
        	
                d.  

              	
                CFC
      Advantage, LLC, organized in the State of Delaware. Borrower owns 100% of
      the membership interests.

              

      

      

      

      
        
          
          

        

        
          SCHEDULE 5.03(a)

          
            

          

        

        
          
          

        

      

      SCHEDULE
9.15

       

      ICC
TRANSACTIONS

       

      Background

       

      As
described in the Borrower’s filings with the U.S. Securities and Exchange
Commission, Rural Telephone Finance Cooperative (“RTFC”), a Consolidated
Subsidiary of the Borrower, made secured loans to Innovative Communication
Corporation (“ICC”), a
diversified telecommunications company organized under the laws of the United
States Virgin Islands (“USVI”) and headquartered in
St. Croix, USVI. Through operating divisions and subsidiaries, ICC provides
cellular, wireline local and long-distance telephone, cable television, Internet
access and other telecommunications services in the eastern and southern
Caribbean.  ICC and its subsidiaries are hereby defined as the “ICC Companies.”  As
of November 30, 2008, RTFC had $485 million in loans outstanding to ICC, and all
such ICC loans have been on non-accrual status since February 1,
2005.  ICC and certain of its affiliates are the subject of pending
bankruptcy proceedings and a Bankruptcy Trustee has been appointed to manage the
operations of the ICC bankruptcy estate (the “Trustee”).  The
Trustee has separated the bankruptcy estate into three asset groups and has sold
two of those groups with the proceeds from the sale being applied to pay a
portion of RTFC debt and other creditors’ claims and to pay administrative
expenses of the estate. The remaining assets of the estate which are described
by the Trustee as “Group 1” include the following:

      

      “Group 1”:

      

      
        	
                ·  

              	
                Wireline
      telephone operations in the USVI,

              

      

      
        	
                ·  

              	
                Wireless
      telephone operations in the USVI and St. Maarten/St. Martin,
      and

              

      

      
        	
                ·  

              	
                Cable
      television service operations in the USVI, the British Virgin Islands and
      St. Maarten.

              

      

      

      

      ICC
Transactions

       

      The
Borrower and RTFC are contemplating the acquisition of some or all of the
assets, third-party debt and/or stock of the ICC Companies in Group 1
(collectively, “ICC
Assets”), (a) through a credit bid pursuant to which, if such credit bid
is successful, ICC Assets would be transferred to RTFC, the Borrower or one or
more designees controlled by the Borrower or RTFC (and which may be one or more
special purpose entities owned directly or indirectly by the Borrower or RTFC),
(b) through one or more joint ventures with one or more third-party bidders
pursuant to which the Borrower, RTFC and/or one or more special purpose entities
created by the Borrower or RTFC would receive partial equity ownership in the
acquisition entity/ies or (c) through enforcement of remedies associated with
the various debt instruments (or a combination of (a), (b) and (c) 

       

      
        
          
          

        

        
          SCHEDULE 9.15

          
            

          

        

        
          
          

        

      

      (the
above-mentioned designees, special purpose entities and joint ventures, together
with the ICC Companies, are hereby defined collectively as the “ICC Related Companies”). In
such cases, among other things, (i) RTFC may transfer some or all of its rights
with respect to its ICC loans (including without limitation the right to acquire
ICC Assets pursuant to a successful RTFC credit bid) to the Borrower or to one
or more special purpose entities controlled and designated by the Borrower, and
such transfer(s) of RTFC’s rights may occur (A) in exchange for the Borrower’s
forgiveness of, or in satisfaction of, some or all of RTFC’s indebtedness to the
Borrower that was incurred to finance RTFC’s ICC loans, and/or (B) pursuant to
the terms of a guaranty agreement between the Borrower and RTFC under which the
Borrower has guaranteed, subject to certain limitations, that RTFC’s loss in
respect of its ICC loans will not exceed its loss reserve therefor and under
which the Borrower is entitled to be transferred RTFC’s rights relating to the
ICC loans if RTFC makes a call on the guaranty; (ii) the Borrower and/or RTFC
may provide equity and/or debt capitalization of, and ongoing funding for, the
entities involved in the acquisition, ownership and operation of ICC Assets, and
may create one or more of special purpose entities for such purposes; (iii) the
Borrower and/or RTFC may provide working capital and capital expenditure
financing to the ICC Companies and for the ICC Assets, either directly or
through such special purpose entity/ies; (iv) the acquisition of ICC Assets
would involve settling claims of other creditors of the ICC Companies, which
settlements may be financed by the Borrower and/or RTFC directly or through ICC
Related Companies; (v) the Borrower and/or RTFC may provide credit support
and/or credit enhancement for obligations of ICC Related Companies, including
without limitation in the form of guaranties and/or letters of credit; (vi) the
Borrower or RTFC would hold such ICC Assets (through one or more special purpose
entities) or such joint venture investment(s) and operate or provide for the
operation of the ICC Companies for the purpose of preserving and rehabilitating
such ICC Assets, preparing them for resale or other disposition and reselling or
disposing of them in one or more transactions at a price or prices or for other
consideration satisfactory to RTFC and/or the Borrower; and (vii) the Borrower
and/or RTFC may engage staff and/or outside consultants, agents, managers,
management companies and other professional advisers to advise and assist with
respect to, and/or to carry out, the foregoing.  All of the potential
transactions, actions and other matters referred to above in this paragraph
(together with such other related transactions and steps, occurring prior to or
concurrently with or within a reasonable time after the transactions, actions
and other matters referred to above and as may be reasonably necessary to carry
out such transactions, actions and other matters) are hereby defined
collectively as the “ICC
Transactions.”

       

      Nothing
in this Schedule 9.15 or in Section 9.15 of the Credit Agreement shall
constitute an obligation on the Borrower, RTFC or any other Person to enter into
all or any of the transactions, or to take all or any of the actions, described
in this Schedule 9.15.  Transactions and actions referred to in
this Schedule 9.15 are not necessarily listed in the chronological order in
which they may be entered into or taken.

      
         

        
          
            
            

          

          
            SCHEDULE 9.15

            
              

            

          

          
            
            

          

        

      

      EXHIBIT
A

       

      FORM OF
NOTE

       

      New York,
New York [DATE]

       

      For value
received, National Rural Utilities Cooperative Finance Corporation, a
not-for-profit cooperative association incorporated under the laws of the
District of Columbia (the “Borrower”), promises to pay to
the order of ● (the “Bank”), for the account of its
Applicable Lending Office, the unpaid principal amount of each Loan made by the
Bank to the Borrower pursuant to the Revolving Credit Agreement referred to
below on the Maturity Date with respect to such Loan.  The Borrower
promises to pay interest on the unpaid principal amount of each such Loan on the
dates and at the rate or rates provided for in the Revolving Credit
Agreement.  All such payments of principal and interest shall be made
in lawful money of the United States in Federal or other immediately available
funds at the office of The Bank of Nova Scotia, c/o GWS Loan Operations, 720
King Street West, 2nd Floor,
Toronto, Ontario, M5V 2T3, Attn: NYA Loan Operations.

       

      All Loans
made by the Bank, the respective types and maturities thereof and all repayments
of the principal thereof shall be recorded by the Bank and, prior to any
transfer hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Bank on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of
the Bank to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Revolving Credit
Agreement.

       

      This note
is one of the Notes referred to in Revolving Credit Agreement, dated as of March
13, 2009, among the Borrower, the Banks listed on the signature pages thereof,
The Bank of Nova Scotia, as Administrative Agent, The Royal Bank of Scotland
plc, as Syndication Agent, and Deutsche Bank Securities Inc., UBS Loan Finance
LLC and The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as
Co-Documentation Agents (as the same may be amended from time to time, the
“Revolving Credit
Agreement”).  Terms defined in the Revolving Credit Agreement
are used herein with the same meanings.  Reference is made to the
Revolving Credit Agreement for provisions for the prepayment hereof and the
acceleration of the maturity hereof.

       

      
        
          	
                  NATIONAL
      RURAL UTILITIES 

                    
      COOPERATIVE FINANCE 

                    
      CORPORATION

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

       

      
        
          
          

        

        
          Ex.
A-1

          
            

          

        

        
          
          

        

      

       

      Note
(cont’d)

      

      

      LOANS AND
PAYMENTS OF PRINCIPAL

      

      

      
        
          	
                  Date

                	
                  Amount
      of 

                  Loan

                	
                  Type
      of 

                  Loan

                	
                  Amount
      of 

                  Principal
      Repaid

                	
                  Maturity
      

                  Date

                	
                  Notation
      

                  Made
      By

                
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      

        

      

      
         

        
          
            
            

          

          
            Ex.
A-2

            
              

            

          

          
            
            

        

      

      EXHIBIT
B-1

       

      FORM OF RUS
GUARANTEE

      

      The
United States of America acting through the Administrator of the Rural Utilities
Service (“RUS”) hereby
unconditionally guarantees to [name of Payee] the making of [__%] of the
payments of principal and interest when and as due on this Note of _________
(the “Cooperative”) in
accordance with the terms hereof and of the Loan Agreement referred to in this
Note, until such principal and interest shall be indefeasibly paid in full
(which includes interest accruing on such principal between the date of default
under this Note and the payment in full of this Guarantee), irrespective of
receipt by RUS of any sums or property from its enforcement of its remedies for
the Cooperative default.  This Guarantee shall be incontestable except
for fraud or misrepresentation of which the holder had actual knowledge at the
time it became a holder.  RUS hereby waives diligence, presentment,
demand, protest and notice of any kind, as well as any requirement that [name of
Payee] exhaust any right or take any action against the
Cooperative.

       

      This
Guarantee is issued pursuant to Title III of the Rural Electrification Act of
1936, as amended (7 U.S.C. ‘‘ 901, et seq.), and the Loan Guarantee
and Servicing Agreement among RUS, the Cooperative, Bank One, NA and National
Rural Utilities Cooperative Finance Corporation dated ___________,
____.

       

      
        
          	 
      	
                  UNITED
      STATES OF AMERICA

                
	
                  Date________________,
      ___

                	
                  By:

                	 
      
	 
      	
                  Name:

                
	 
      	
                  Title:Administrator
      of Rural

                  Electrification
      Administration

                

        

      

       

      
         

        
          
            
            

          

          
            Ex.
B-1

            
              

            

          

          
            
            

          

        

      

      EXHIBIT
B-2

       

      FORM OF RUS
GUARANTEE

      

      The
United States of America acting through the Administrator of the Rural Utilities
Service (“RUS”) hereby
unconditionally guarantees to the Payee the making of the payments of principal
and Guaranteed Interest when and as due on the Note of _______________ (the
“Cooperative”) dated
_____ in the original principal amount of $ _____ (the “Note”), in accordance with the
terms thereof and of the Loan Agreement and the Master Loan Guarantee and
Servicing Agreement referred to in the Note, until such principal and Guaranteed
Interest shall be indefeasibly paid in full (which includes interest accruing at
the Guaranteed Interest Rate between the date of default under the Note and the
payment in full of this Guarantee), irrespective of receipt by RUS of any sums
or property from its enforcement of its remedies for the Cooperative’s
default.  This Guarantee shall be incontestable except for fraud or
misrepresentation of which the holder had actual knowledge at the time it became
a holder.  RUS hereby waives diligence, presentment, demand, protest
and notice of any kind (except the “Default Notice” required pursuant to Section
5.3(a) of the Master Loan Guarantee and Servicing Agreement), and acknowledges
that the Payee does not have any right or obligation to exercise any right or
take any action against the Cooperative.

       

      This
Guarantee is issued pursuant to the Rural Electrification Act of 1936, as
amended (7 U.S.C. ‘‘ 901, et seq.) (the “Act”), and the Master Loan
Guarantee and Servicing Agreement between RUS and National Rural Utilities
Cooperative Finance Corporation dated as of February 16, 1999.

       

      THIS
GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE UNITED STATES OF AMERICA, TO THE EXTENT APPLICABLE, AND
OTHERWISE THE LAWS OF THE COMMONWEALTH OF VIRGINIA.

       

      THE
UNDERSIGNED, AS [ADMINISTRATOR] OF RUS, DOES HEREBY CERTIFY THAT I AM AUTHORIZED
UNDER THE ACT AND 7 CFR PART 1700 TO DELIVER THIS GUARANTEE.

       

      
        
          
            	
                    UNITED
      STATES OF AMERICA

                  
	
                    By:

                  	 
      
	
                    Name:

                  
	
                    Title:[Administrator]
      of the Rural Utilities
Service

                  

          

        

      

      
        
          	
                  Dated:__________________

                	
                  RUS
      Loan No

                	 

        

      

      

      
        
          
          

        

        
          Ex.
B-2

          
            

          

        

        
          
          

        

      

      EXHIBIT
C

       

      FORM OF MONEY MARKET QUOTE
REQUEST

      

      [Date]

      
        	
                To:

              	
                The
      Bank of Nova Scotia (the “Administrative
      Agent”)

              

      

       

      
        	
                From:

              	
                National
      Rural Utilities Cooperative Finance Corporation (the ”Borrower”)

              

      

       

      
        	
                Re:

              	
                Revolving
      Credit Agreement, dated as of March 13, 2009, among the Borrower, the
      Banks listed on the signature pages thereof, The Bank of Nova Scotia, as
      Administrative Agent, The Royal Bank of Scotland plc, as Syndication
      Agent, and Deutsche Bank Securities Inc., UBS Loan Finance LLC and The
      Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as Co-Documentation
      Agents (the “Revolving
      Credit Agreement”)

              

      

       

      We hereby
give notice pursuant to Section 2.03 of the Revolving Credit Agreement that we
request Money Market Quotes for the following proposed Money Market
Borrowing(s):

       

      Date of
Borrowing:  __________________

       

      Principal Amount1                                                                Interest Period2

      $

       

      Such
Money Market Quotes should offer a Money Market [Margin] [Absolute
Rate].  [The applicable base rate is the London Interbank Offered
Rate.]

       

      Terms
used herein have the meanings assigned to them in the Revolving Credit
Agreement.

       

      
        
          	
                  NATIONAL
      RURAL UTILITIES 

                    
      COOPERATIVE FINANCE 

                    
      CORPORATION

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

       

      
        

      

       

        1   Amount
must be $10,000,000 or a larger multiple of $1,000,000.

         

      

      
        2   Any
number of whole months (but not less than one month) (LIBOR Auction) or not less
than 30 days (Absolute Rate Auction), subject to the provisions of the
definition of Interest Period.

         

        
          
            
            

          

          
            Ex.
C-1

            
              

            

          

          
            
            

          

        

         

      

      EXHIBIT
D

       

      FORM OF INVITATION FOR MONEY
MARKET QUOTES

      

      [Date]

      
        	
                To:

              	
                [Name
      of Bank]

              

      

       

      
        	
                Re:

              	
                Invitation
      for Money Market Quotes to the National Rural Utilities Cooperative
      Finance Corporation (the “Borrower”)

              

      

       

      Pursuant to Section 2.03 of the
Revolving Credit Agreement, dated as of March 13, 2009, among the Borrower, the
Banks listed on the signature pages thereof, The Bank of Nova Scotia, as
Administrative Agent, The Royal Bank of Scotland plc, as Syndication Agent, and
Deutsche Bank Securities Inc., UBS Loan Finance LLC and The Bank of
Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as Co-Documentation Agents (the
“Revolving Credit
Agreement”):

       

      
        	
                 
      

              	
                Date
      of
Borrowing:  __________________

              

      

       

      
        	
                 
      

              	
                Principal
      Amount

              	
                Interest
      Period

              

      

      $

      

      Such
Money Market Quotes should offer a Money Market [Margin] [Absolute Rate]. [The
applicable base rate is the London Interbank Offered Rate.]

       

      Please
respond to this invitation by no later than 9:30 A.M. (New York City time) on
[date].

       

      
        
          	
                  The
      Bank of Nova Scotia

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:Authorized
      Officer

                

        

      

      

      
        
          
          

        

        
          Ex.
D-1

          
            

          

        

        
          
          

        

      

      EXHIBIT
E

       

      FORM OF MONEY MARKET
QUOTE

      

      [Date]

      
        	
                 
      

              	
                The
      Bank of Nova Scotia,

              

      

      
        	
                 
      

              	
                as
      Administrative Agent

              

      

      c/o GWS
Loan Operations

      720 King
Street West, 2nd
Floor

      Toronto,
Ontario  M5V 2T3

      Attn: NYA
Loan Operations

      

      Attention:

      

      
        	
                Re:

              	
                Money
      Market Quote to National Rural Utilities
  Cooperative

              

      

       

      
        	
                 
      

              	
                Finance
      Corporation (the “Borrower”)

              

      

       

      In
response to your invitation on behalf of the Borrower dated _____________, 200_,
we hereby make the following Money Market Quote on the following
terms:

       

      
        	
                1.

              	
                Quoting
      Bank:  ________________________________

              

      

       

      
        	
                2.

              	
                Person
      to contact at Quoting
      Bank:  _____________________________

              

      

       

      
        	
                3.

              	
                Date
      of Borrowing: ____________________*

              

      

       

      
        	
                4.

              	
                We
      hereby offer to make Money Market Loan(s) in the following principal
      amounts, for the following Interest Periods and at the following
      rates:

              

      

       

      

        

      

      
        
          * As
specified in the related Invitation.

        

      

       

      
        
          
          

        

        
          Ex.
E-1

          
            

          

        

        
          
          

        

      

       

       

      
        
          
            	
                    Principal
      Amount**

                  	
                    Interest
      Period***

                  	
                    Money
      Market [Margin****]

                  	
                    [Absolute
      Rate*****]

                  
	
                    $

                  	 
      	 
      	 
      
	
                    $

                  	 
      	 
      	 
      
	 
      	 
      	 
      	 
      

          

        

      

      [provided, that the aggregate
principal amount of Money Market Loans for which the above offers may be
accepted shall not exceed $____________.]**

       

      We
understand and agree that the offer[s] set forth above [is][are] subject to the
satisfaction of the applicable conditions set forth in the Revolving Credit
Agreement, dated as of March 13, 2009, among the Borrower, the Banks listed on
the signature pages thereof, The Bank of Nova Scotia, as Administrative Agent,
The Royal Bank of Scotland plc, as Syndication Agent, and Deutsche Bank
Securities Inc., UBS Loan Finance LLC and The Bank of Tokyo-Mitsubishi UFJ,
Ltd., New York Branch, as Co-Documentation Agents.

       

      
        
          	
                  Very
      truly yours,

                  [NAME
      OF BANK]

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:Authorized
      Officer

                

        

      

      

                          Dated:
_______________

       

       

        
          

        

        **
Principal amount bid for each Interest Period may not exceed principal amount
requested. Specify aggregate limitation if the sum of the individual offers
exceeds the amount the Bank is willing to lend.  Bids must be made for
$1,000,000 or a larger multiple thereof.

      

       

        *** Any
number of whole months (but not less than one month) or not less than 30 days,
as specified in the related Invitation.  No more than five bids are
permitted for each Interest Period.

      

       

        ****
Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period.  Specify percentage (rounded to the
nearest 1/10,000 of 1%) and specify whether “PLUS” or “MINUS”.

      

       

        *****
Specify rate of interest per annum (rounded to the nearest 1/10,000th of
1%).

         

        
          
            
            

          

          
            Ex.
E-2

            
              

            

          

          
            
            

          

        

      

      EXHIBIT
F

       

      OPINION OF GENERAL COUNSEL
OF THE BORROWER

      

      March 13,
2009

      

      To the
Administrative Agent and each of the Banks party

       to
the Revolving Credit Agreement referred to below

      c/o The
Bank of Nova Scotia

      One
Liberty Plaza

      New York,
New York 10006

      

      Ladies
and Gentlemen:

      

      I, John
Jay List, General Counsel of the National Rural Utilities Cooperative Finance
Corporation (the “Borrower”), am delivering this
opinion pursuant to the Revolving Credit Agreement (the “Agreement”), dated as of March
13, 2009, among the Borrower, the Banks listed on the signature pages thereof,
The Bank of Nova Scotia, as Administrative Agent, The Royal Bank of Scotland
plc, as Syndication Agent, and Deutsche Bank Securities Inc., UBS Loan Finance
LLC and The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as
Co-Documentation Agents.  Terms defined in the Agreement are used
herein as therein defined.  This opinion is being rendered to you at
the request of the Borrower, pursuant to Section 3.01(c) of the
Agreement.

       

      I have
examined originals or copies, certified or otherwise identified to my
satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as I have deemed necessary or advisable for purposes of this
opinion. This opinion is limited to the laws of the District of
Columbia.

       

      Upon the
basis of the foregoing, I am of the opinion that:

       

      1.           The
Borrower is a cooperative association duly incorporated, validly existing and in
good standing under the laws of the District of Columbia and has the corporate
power and authority and all material governmental licenses, authorizations,
consents and approvals required to own its property and assets and to transact
the business in which it is engaged.  The Borrower is duly qualified
or licensed as a foreign corporation in good standing in every jurisdiction in
which the nature of the business in which it is engaged makes such qualification
or licensing necessary, except in those jurisdictions in which the failure to be
so qualified or licensed would not (after qualification, assuming that the
Borrower could so qualify without the payment of any fee or penalty and retain
its rights as they existed prior to such qualification all to an extent so that
any fees or penalties required to be so paid or any rights not so retained would
not, individually or in the aggregate, have a material adverse effect on the
business or financial position 

       

      
        
          
          

        

        
          Ex.
F-1

          
            

          

        

        
          
          

        

      

      of the
Borrower), individually or in the aggregate, have a material adverse effect upon
the business or financial position of the Borrower.

       

      2.           The
Borrower has the corporate power and authority to execute, deliver and carry out
the terms and provisions of the Agreement and the Notes.  The
Agreement and the Notes have been duly and validly authorized, executed and
delivered by the Borrower, and the Agreement constitutes a legal, valid and
binding agreement of the Borrower, and the Notes constitute legal, valid and
binding obligations of the Borrower, in each case enforceable in accordance with
its terms, except as the same may be limited by: (a) bankruptcy, insolvency,
reorganization, receivership, moratorium and other laws affecting creditors’
rights (including without limitation, the effect of statutory and other law
regarding fraudulent conveyances, fraudulent transfers and preferential
transfers); and (b) the exercise of judicial discretion and the application of
principles of equity, good faith, fair dealing, reasonableness, conscionability
and materiality (regardless of whether the applicable agreements are considered
in a proceeding in equity or at law). The opinions expressed in this paragraph
shall be understood to mean that if there is a default in performance of an
obligation, (i) if a failure to pay or other damage can be shown and (ii) if the
defaulting party can be brought into a court which will hear the case and apply
the governing law, then, subject to the availability of defenses, and to the
exceptions set forth in sections (a) and (b) of this paragraph, the court will
provide a money damage (or perhaps injunctive or specific performance)
remedy.

       

      3.           There
are no actions, suits, proceedings or investigations pending or, to my
knowledge, threatened against or affecting the Borrower by or before any court
or any governmental authority, body or agency or any arbitration board which are
reasonably likely to materially adversely affect the business, financial
position or results of operations of the Borrower or the authority or ability of
the Borrower to perform its obligations under the Agreement or the
Notes.  Without limiting the foregoing opinion, I would like to draw
your attention to the legal actions described on Annex A.

       

      4.           No
authorization, consent, approval or license of, or declaration, filing or
registration with or exemption by, any governmental authority, body or agency is
required in connection with the execution, delivery or performance by the
Borrower of the Agreement or the Notes.

       

      5.           The
holders of the Borrower’s Members’ Subordinated Certificates are not and will
not be entitled to receive any payments with respect to the principal thereof or
interest thereon solely because of withdrawing or being expelled from membership
in the Borrower.

       

      6.           Neither
the Borrower nor any Consolidated Subsidiary is in default in any material
respect under any material agreement or other instrument to 

       

      
        
          
          

        

        
          Ex.
F-2

          
            

          

        

        
          
          

        

      

      which it
is a party or by which it or its property or assets is bound. No event or
condition exists which constitutes, or with the giving of notice or lapse of
time or both would constitute, such a default under any such agreement or other
instrument.  Neither the execution and delivery of the Agreement or
the Notes, nor the consummation of any of the transactions therein contemplated,
nor compliance with the terms and provisions thereof, will contravene any
provision of law, statute, rule or regulation to which the Borrower is subject
or any judgment, decree, award, franchise, order or permit applicable to the
Borrower, or will conflict or be inconsistent with, or will result in any
material breach of, any of the material terms, covenants, conditions or
provisions of, or constitute (or with the giving of notice or lapse of time, or
both, would constitute) a default under (or condition or event entitling any
Person to require, whether by purchase, redemption, acceleration or otherwise,
the Borrower to perform any obligations prior to the scheduled maturity
thereof), or result in the creation or imposition of any Lien upon any of the
property or assets of the Borrower pursuant to the terms of, any indenture,
mortgage, deed of trust, agreement or other instrument to which it may be
subject, or violate any provision of the certificate of incorporation or by-laws
of the Borrower.  Without limiting the generality of the foregoing,
the Borrower is not a party to, or otherwise subject to any provision contained
in, any instrument evidencing Indebtedness of the Borrower, any agreement or
indenture relating thereto or any other contract or agreement (including its
certificate of incorporation and by-laws), which would be violated by the
incurring of the Indebtedness to be evidenced by the Notes.

       

      7.           The
Borrower has complied fully with all of the material provisions of each
Indenture.  No Event of Default (within the meaning of such term as
defined in any Indenture) and no event, act or condition (except for possible
non-compliance by the Borrower with any immaterial provisions of such Indenture
which in itself is not such an Event of Default under such Indenture) which with
notice or lapse of time, or both, would constitute such an Event of Default has
occurred and is continuing under such Indenture.  The borrowings by
the Borrower contemplated by the Agreement will not cause such an Event of
Default under, or the violation of any covenant contained in, any
Indenture.

       

      8.           Set
forth on Annex B attached hereto is a true, correct and complete list of all of
the Borrower’s Subsidiaries and Joint Ventures, the jurisdiction of
incorporation or organization of each such Subsidiary and Joint Venture and the
nature and percentage of the Borrower’s ownership of each such Subsidiary and
Joint Venture.

       

      9.           The
Borrower has received a ruling from the Internal Revenue Service to the effect
that it is exempt from payment of Federal income tax under Section 501(c)(4) of
the Internal Revenue Code of 1986, and nothing has come to our attention that
leads us to believe that the Borrower is not so exempt.

       

      
        
          
          

        

        
          Ex.
F-3

          
            

          

        

        
          
          

        

      

      Although
the parties have agreed that the Agreement and Notes shall be governed by and
construed in accordance with the laws of the State of New York, if a court were
to hold that the Agreement and Notes are to be governed and construed in
accordance with the laws of the District of Columbia, the Agreement and Notes
would, under the laws of the District of Columbia, be legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance with
their respective terms, subject as to enforceability only to those
qualifications referenced in Paragraph 1 above.

      

      

      Sincerely,

      

      

      

      John Jay
List

      General
Counsel

      

      
        
          
          

        

        
          Ex.
F-4

          
            

          

        

        
          
          

        

      

      Annex
A

       

      Innovative
Communication Corporation (“ICC”) is a diversified telecommunications company
and Rural Telephone Finance Cooperative (“RTFC”) borrower headquartered in St.
Croix, United States Virgin Islands (“USVI”).  In the USVI, through
its subsidiary Virgin Islands Telephone Corporation d/b/a Innovative Telephone
(“Vitelco”) and other operating subsidiaries and divisions, ICC provides
cellular, wireline local and long-distance telephone, cable television, and
Internet access services.  Through other subsidiaries, ICC provides
telecommunications, cable television, and Internet access services in the
eastern and southern Caribbean.

       

      As of
November 30, 2008 and May 31, 2008, RTFC had $485 million and $492 million,
respectively, in loans outstanding to ICC.  All loans to ICC have been
on non-accrual status since February 1, 2005.  ICC has not made debt
service payments to RTFC since June 2005.

       

      RTFC is
the primary secured lender to ICC.  RTFC’s collateral for the loans
included (i) a series of mortgages, security agreements, financing statements,
pledges and guaranties creating liens in favor of RTFC on substantially all of
the assets and voting stock of ICC, (ii) a direct pledge of 100% of the voting
stock of ICC’s USVI local exchange carrier subsidiary, Vitelco, (iii) secured
guaranties, mortgages and direct and indirect stock pledges encumbering the
assets and ownership interests in substantially all of ICC’s other operating
subsidiaries and certain of its parent entities, including ICC’s immediate
parent, Emerging Communications, Inc., a Delaware corporation (“Emcom”) and
Emcom’s parent, Innovative Communication Company LLC, a Delaware limited
liability company (“ICC-LLC”), and (iv) a personal guaranty of the loans from
ICC’s indirect majority shareholder and chairman, Jeffrey Prosser
(“Prosser”).

       

      In
February 2006, involuntary bankruptcy petitions were filed against Prosser,
Emcom and ICC-LLC; and on April 26, 2006, RTFC reached a settlement of related
litigation with ICC, Vitelco, ICC-LLC, Emcom, their directors and Prosser,
individually.  Under the settlement, RTFC obtained entry of judgments
in the District Court for the District of the Virgin Islands against ICC for
approximately $525 million and Prosser for approximately $100
million.  RTFC also obtained dismissals with prejudice of all
counterclaims, affirmative defenses and other lawsuits alleging wrongful acts by
RTFC, certain of its officers, and National Rural Utilities Cooperative Finance
Corporation (“CFC”), thereby resolving all the related loan litigation in RTFC’s
favor.  Prosser and related parties continue to assert claims in
proceedings against CFC and certain of its officers and directors and other
parties.

       

      On July
31, 2006, ICC-LLC, Emcom and Prosser each filed a voluntary bankruptcy petition
for reorganization.  The cases are pending in the United States

       

      
        

        
          
            
            

          

          
            Ex.
F-5

            
              

            

          

          
            
            

          

        

      

      District
Court for the Virgin Island, Bankruptcy Division (the “Bankruptcy
Court”).  A Chapter 11 trustee, Stan Springel, was later appointed for
the ICC-LLC and Emcom estates; and Prosser’s individual case was converted to
Chapter 7 liquidation in October 2007.  Prosser’s Chapter 7 trustee is
in the process of selling Prosser’s non-exempt assets for eventual payment of
creditor claims.

       

      On
September 21, 2007, the Bankruptcy Court entered an order placing ICC in a
Chapter 11 bankruptcy proceeding, and on October 3, 2007 appointed Stan Springel
as its trustee.  The Chapter 11 trustee of ICC has assumed ownership
and control of ICC, including its subsidiaries, and has begun to sell RTFC
collateral and other assets, including property in Prosser’s possession or
control, for disposition and eventual payment in respect of RTFC’s claims and
the claims of other parties-in-interest.  Certain assets have been
sold, including certain foreign companies, aircraft, and real
estate.  Cable television operations in Guadeloupe, Martinique and
France were sold in the fourth quarter of 2008.

       

      Closing
of the sale (as part of the Chapter 11 cases) of ICC, together with its
subsidiaries engaged in regulated telecommunications businesses, will require
the prior consent of the respective regulators in the United States (including
the Federal Communications Commission and the U.S. Virgin Islands Public
Services Commission), the British Virgin Islands and the Netherlands
Antilles.  In certain cases, only a post-transaction notification will
be required.

       

      On or
about December 7, 2008, Jeffrey Prosser, Dawn Prosser, Adrian Prosser and John
Raynor filed a lawsuit in the United States District for the United States
Virgin Islands against CFC, RTFC, Sheldon C. Petersen, John Jay List, Steven L.
Lilly (each an officer of CFC), Wayne Stratton (a director of CFC) et. al.
alleging violations of the Racketeer Influenced and Corrupt Organizations Act
and the Virgin Islands Criminally Influenced and
Corrupt  Organizations Act, torts actionable under Virgin Islands law,
and common law civil conspiracy.  CFC and RTFC believe that the suit
is completely without merit and are vigorously pursuing a dismissal of the
case.  CFC and RTFC believe that the allegations raised in this
complaint, like similar allegations brought previously and either released or
dismissed, are completely baseless, and part of a pattern of abusive litigation
in this matter.

       

      Nothing
herein constitutes an admission that the foregoing are reasonably likely to
materially adversely affect the business, financial position or results of CFC
or the authority or ability of CFC to perform its obligations under the
Agreement or the Notes.

       

      
        
          
          

        

        
          Ex.
F-6

          
            

          

        

        
          
          

        

      

      Annex
B

       

      Subsidiaries,
Special Purpose Subsidiaries and Joint Ventures:

       

      
        	
                 
      

              	
                a.

              	
                CFC
      Advantage, LLC, organized in the State of Delaware. Borrower owns 100% of
      the membership interests.

              

      

       

      
        	
                 
      

              	
                b.

              	
                Denton
      Realty Holdings, LLC, organized in the State of Delaware. Borrower owns
      100% of the membership interests.

              

      

       

      
        	
                 
      

              	
                c.

              	
                Denton
      Realty Investors, LLC, organized in the State of Delaware. Borrower owns
      100% of the membership interests.

              

      

       

      
        	
                 
      

              	
                d.

              	
                Denton
      Realty Partners, LP, organized in the State of Delaware. Denton Realty
      Holdings, LLC is the general partner and owns 0.5% of the partnership
      interests, and Denton Realty Investors, LLC is the limited partner and
      owns 99.5% of the partnership
interests.

              

      

       

      Denton
Realty Partners, LP ownership interest:

       

      Rayzor
Ranch,
L.P.                                                      
 25%

      Laurel
Development II,
L.P.                                         10%

      W/J Lakes
Development
LP                                        50%

      W/J Lakes
LP                                                                50%

       

      
        
          
          

        

        
          Ex.
F-7

          
            

          

        

        
          
          

        

      

      

      EXHIBIT
G

       

      ASSIGNMENT AND ASSUMPTION
AGREEMENT

       

      AGREEMENT
dated as of ___________, 200__ among [ASSIGNOR] (the “Assignor”), [ASSIGNEE] (the
“Assignee”), NATIONAL
RURAL UTILITIES COOPERATIVE FINANCE CORPORATION (the “Borrower”) and THE BANK OF
NOVA SCOTIA, as Administrative Agent (the “Agent”).

       

      W I T N E
S S E T H

       

      WHEREAS,
this Assignment and Assumption Agreement (the “Agreement”) relates to the
Revolving Credit Agreement, dated as of March 13, 2009 (the “Credit Agreement”), among the
Borrower, the Banks listed on the signature pages thereof, The Bank of Nova
Scotia, as Administrative Agent (the “Agent”), and The Royal Bank of
Scotland plc, as Syndication Agent, and Deutsche Bank Securities Inc., UBS Loan
Finance LLC and The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as
Co-Documentation Agents.

       

      WHEREAS,
as provided under the Credit Agreement, the Assignor has a Commitment to make
Loans to the Borrower in an aggregate principal amount at any time outstanding
not to exceed $__________;

       

      WHEREAS,
Committed Loans made to the Borrower by the Assignor under the Credit Agreement
in the aggregate principal amount of $__________ are outstanding at the date
hereof; and

       

      WHEREAS,
the Assignor proposes to assign to the Assignee all of the rights of the
Assignor under the Credit Agreement in respect of a portion of its Commitment
thereunder in an amount equal to $__________ (the “Assigned Amount”), together
with a corresponding portion of its outstanding Committed Loans, and the
Assignee proposes to accept assignment of such rights and assume the
corresponding obligations from the Assignor on such terms;

       

      NOW,
THEREFORE, in consideration of the foregoing and the mutual agreements contained
herein, the parties hereto agree as follows:

       

      SECTION
1.                                Definitions.  All
capitalized terms not otherwise defined herein shall have the respective
meanings set forth in the Credit Agreement.

       

      SECTION
2.                                Assignment.  The
Assignor hereby assigns and sells to the Assignee all of the rights of the
Assignor under the Credit Agreement to the extent of the Assigned Amount, and
the Assignee hereby accepts such assignment from the Assignor and assumes all of
the obligations of the Assignor under the Credit Agreement to the extent of the
Assigned Amount, including the purchase from the Assignor of the corresponding
portion of the principal amount of the Committed Loans made by the Assignor
outstanding at the date hereof.  

       

      
        
          
          

        

        
          Ex.
G-1

          
            

          

        

        
          
          

        

      

      Upon the
execution and delivery hereof by the Assignor, the Assignee, the Borrower and
the Administrative Agent and the payment of the amounts specified in Section 3
required to be paid on the date hereof (i) the Assignee shall, as of the date
hereof, succeed to the rights and be obligated to perform the obligations of a
Bank under the Credit Agreement with a Commitment in an amount equal to the
Assigned Amount, and (ii) the Commitment of the Assignor shall, as of the date
hereof, be reduced by a like amount and the Assignor released from its
obligations under the Credit Agreement to the extent such obligations have been
assumed by the Assignee.  The assignment provided for herein shall be
without recourse to the Assignor.

       

      SECTION
3.  Payments.  As
consideration for the assignment and sale contemplated in Section 2 hereof, the
Assignee shall pay to the Assignor on the date hereof in Federal funds the
amount heretofore agreed between them. It is understood that commitment and/or
facility fees accrued to the date hereof are for the account of the Assignor and
such fees accruing from and including the date hereof are for the account of the
Assignee.  Each of the Assignor and the Assignee hereby agrees that if
it receives any amount under the Credit Agreement which is for the account of
the other party hereto, it shall receive the same for the account of such other
party to the extent of such other party’s interest therein and shall promptly
pay the same to such other party.

       

      SECTION
4.                                Consent of the Borrower and the
Administrative Agent.  This Agreement is conditioned upon the
consent of the Borrower and the Administrative Agent pursuant to Section 9.06(c)
of the Credit Agreement.  The execution of this Agreement by the
Borrower and the Administrative Agent is evidence of this
consent.  Pursuant to Section 9.06(c) of the Credit Agreement, if
requested by the Assignee, the Borrower agrees to execute and deliver a Note
payable to the order of the Assignee to evidence the assignment and assumption
provided for herein.

       

      SECTION
5.                                Non-Reliance on
Assignor.  The Assignor makes no representation or warranty in
connection with, and shall have no responsibility with respect to, the solvency,
financial position, or statements of the Borrower, or the validity and
enforceability of the obligations of the Borrower in respect of the Credit
Agreement or any Note.  The Assignee acknowledges that it has,
independently and without reliance on the Assignor, and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and will continue to be responsible for
making its own independent appraisal of the business, affairs and financial
position of the Borrower.

       

      
        
          
          

        

        
          Ex.
G-2

          
            

          

        

        
          
          

        

      

      SECTION
6.                                Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

       

      SECTION
7.                                Counterparts.  This
Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.

       

       

      IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered by their duly authorized officers as of the date first above
written.

       

      
        
          	
                  [ASSIGNOR]

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

      

      
        
          	
                  [ASSIGNEE]

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

      

      
        
          	
                  NATIONAL
      RURAL UTILITIES COOPERATIVE FINANCE CORPORATION

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

      

      
        
          	
                  THE
      BANK OF NOVA SCOTIA, as Administrative Agent

                
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

      

      
        
          
          

        

        
          Ex.
G-3

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