Document:

Exhibit

COBANK, ACB,
as Loan Participation Servicer
and
FEDERAL AGRICULTURAL MORTGAGE CORPORATION,
as Loan Participation Holder
LOAN PARTICIPATION SERVICING AGREEMENT
Dated as of February 13, 2019

 

TABLE OF CONTENTS
ARTICLE I Defined Terms..............................................................................................................1
		
	Section 1.01. General Definitions................................................................................................
	.1

		
	Section 1.02. Other Definitional Provisions.................................................................................
	3

		
	ARTICLE II Administration and Servicing of Loan Participations.............................................
	4

		
	Section 2.01. General Servicing Provision..................................................................................
	4

Section 2.02. Agency Relationship...............................................................................................4
Section 2.03. Modifications, Waivers, Consents..........................................................................4
Section 2.04. Powers of Attorney.................................................................................................5
Section 2.05. Loan Participation Reporting................................................................................5
Section 2.06. Remittances............................................................................................................6
Section 2.07. Realization Upon Defaulted Loans........................................................................6
Section 2.08. Servicing Compensation and Reimbursement.......................................................7
Section 2.09. Servicer Default.....................................................................................................7
Section 2.10. Resignation and Termination of Loan Participation Servicer..............................8
Section 2.11. Inspection Rights...................................................................................................9
Section 2.12. Limitation on Liability of the Loan Participation Servicer and Others................9
Section 2.13. Statements and Certificates to Loan Participation Holder...................................9

ARTICLE III Representations and Warranties...........................................................................10

Section 3.01. Representations and Warranties of the Loan Participation Servicer..................10
Section 3.02. Representations and Warranties of the Loan Participation Holder....................11
Section 3.03. Remedies for Breach of Representations and Warranties...................................12

ARTICLE IV Miscellaneous........................................................................................................12

Section 4.01. Governing Law.....................................................................................................12
Section 4.02. WAIVER OF JURY TRIAL...................................................................................12
Section 4.03. Demands, Notices, Communications...................................................................13
Section 4.04. Severability of Provisions....................................................................................13
Section 4.05. Amendment..........................................................................................................14
Section 4.06. Counterparts.......................................................................................................14
Section 4.07. Authorized Officers............................................................................................14
Section 4.08. Assignability......................................................................................................14

Exhibit A – Annual Officer’s Certificate
Exhibit B – Distribution Report (Form)
Exhibit C – Loan Setup File (Form)
Exhibit D – Portfolio Financial Data Report (Form)
Exhibit E – Portfolio Risk Rating Report (Form)

 

This LOAN PARTICIPATION SERVICING AGREEMENT (this “Servicing Agreement”) is made and entered into as of February 13, 2019 by and between COBANK, ACB, a federally chartered instrumentality of the United States (the “Loan Participation Servicer”), and the FEDERAL AGRICULTURAL MORTGAGE CORPORATION, a federally chartered instrumentality of the United States (the “Loan Participation Holder”).
WHEREAS, the Loan Participation Holder has purchased and may purchase from time to time Loan Participations from the Loan Participation Servicer in its capacity as “Lead Lender” under the Master Non-Recourse Loan Participation Agreement dated as of February 13, 2019 (as amended from time to time, the “Participation Agreement”) between the Loan Participation Servicer and the Loan Participation Holder; and
WHEREAS, the parties desire that the Loan Participation Servicer service the Loan Participations that the Loan Participation Holder has purchased on behalf and for the benefit of the Loan Participation Holder.
NOW, THEREFORE, the parties to this Servicing Agreement, in the capacities hereinabove set forth, in consideration of the mutual agreements and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, do hereby undertake and otherwise agree as follows:
ARTICLE I
Defined Terms

Section 1.01.      General Definitions. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Participation Agreement.  Whenever used in this Servicing Agreement, the following words and phrases shall have the following meanings:
Annual Officer’s Certificate:  A certificate completed and executed by the Servicing Officer on behalf of the Loan Participation Servicer in accordance with Section 2.13.  Each Annual Officer’s Certificate shall be substantially in the form of Exhibit A hereto (with such changes and modifications as the Loan Participation Servicer and the Loan Participation Holder shall agree from time to time).
Borrower Rating:  The borrower risk rating assigned by the Loan Participation Servicer to a Participated Loan from time to time in accordance with the Loan Participation Servicer’s internal risk rating system.
Change of Control: The Loan Participation Servicer ceases to be a federally-chartered agricultural credit bank with a majority of its shares of voting stock owned by its eligible borrowers.
Customary Servicing Procedures:  With respect to the Loan Participation Servicer, the customary and usual standards of practice employed by the Loan Participation Servicer when servicing and administering loans in the Loan Participation Servicer’s portfolio of a type comparable to the Loan Participations sold pursuant to this Servicing Agreement, including the Participated Loans.

 

Defaulted Loan:  Any Participated Loan as to which (i) any payment or part thereof, remains unpaid for thirty (30) days or more after the original due date for such payment, (ii) the related Borrower is subject to any bankruptcy or insolvency proceeding, (iii) the lien of the related Collateral has been foreclosed or otherwise enforced, sold pursuant to a power of sale or trustee’s sale or repossessed, or proceedings for foreclosure, sale or repossession have been commenced, or (iv) the Loan Participation Servicer has determined, consistent with Customary Servicing Procedures, that such Loan Participation is not collectible.
Distribution Report:  A report in an electronic format reasonably acceptable to the Loan Participation Holder (e.g., spreadsheet or CSV format), which shall be substantially in the format attached hereto as Exhibit B (or as otherwise agreed to between the parties from time to time) that identifies each Loan Participation and contains at minimum the fields set forth in Exhibit B (or as otherwise agreed to between the parties from time to time) for each Loan Participation.  
Loan Participation:  An undivided interest in a loan purchased by the Loan Participation Holder pursuant to the Participation Agreement.
Loan Participation Holder:  As defined in the recitals.
Loan Participation Servicer:  As defined in the recitals.
Loan Setup File:  The information about each Loan Participation serviced by the Loan Participation Servicer, as provided to the Loan Participation Holder by the Loan Participation Servicer pursuant to Section 2.05.  The Loan Setup File shall be provided in an electronic format reasonably acceptable to the Loan Participation Holder (e.g., spreadsheet or CSV format), which shall be substantially in the format attached hereto as Exhibit C (or as otherwise agreed to between the parties from time to time) that identifies each Loan Participation and contains at minimum the fields set forth in Exhibit C (or as otherwise agreed to between the parties from time to time) for each Loan Participation.  
Participated Loan:  The loan in which the Loan Participation Holder has purchased a Loan Participation pursuant to the Participation Agreement.
Participation Agreement:  As defined in the recitals.
Person:  Any legal person, including any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or governmental authority.
Portfolio Financial Data Report:  A report in an electronic format reasonably acceptable to the Loan Participation Holder (e.g., spreadsheet or CSV format) that identifies each Loan Participation and contains the information required by and contained in the Borrower’s annual Financial and Operating Report to the USDA Rural Utilities Service (Form 7 or Form 12, as applicable), the substance of which report the Loan Participation Holder may reasonably request from time to time (and which initially is attached as Exhibit D), and which may be included on a consolidated report of other loans serviced by the Loan Participation Servicer on behalf of the Loan Participation Holder in such other capacity.

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Portfolio Risk Rating Report:  A report in an electronic format reasonably acceptable to the Loan Participation Holder (e.g., spreadsheet or CSV format), which shall be substantially in the format attached hereto as Exhibit E (or as otherwise agreed to between the parties from time to time) that identifies each Loan Participation and contains at minimum the fields set forth in Exhibit E (or as otherwise agreed to between the parties from time to time) for each Loan Participation, and which may be included on a consolidated report of other loans serviced by the Loan Participation Servicer on behalf of the Loan Participation Holder in such other capacity.
Reporting Quarter:  Each calendar quarter ending March 31, June 30, September 30, and December 31.
Risk Rating Methodology:  The Loan Participation Servicer’s current internal risk rating methodology for determining Borrower Ratings.
Sale Date:  Each closing date upon which the sale of one or more Loan Participations is sold to Loan Participation Holder.
Servicing Agreement:  As defined in the recitals.
Servicer Default:  An event described in Section 5.11.
Servicing Fee:  With respect to each Loan Participation, the product of (i) the Servicing Fee Rate with respect to such Loan Participation, and (ii) the outstanding principal amount of such Loan Participation, which shall accrue in arrears corresponding to the date on which interest on such Loan Participation is payable and computed on the basis of the same time period with respect to which interest on such Loan Participation is computed, without giving effect to any principal amount of such Loan Participation paid or payable on the applicable interest payment date. 
Servicing Fee Rate:  With respect to each Loan Participation, a rate per annum as specified in the related Certificate of Participation.
Servicing Officer:  Any officer of the Loan Participation Servicer involved in, or responsible for, the administration and servicing of the Loan Participations whose name and specimen signature appears on a list of Servicing Officers furnished to the Loan Participation Holder by the Loan Participation Servicer from time to time.
Section 1.02.      Other Definitional Provisions.
(a)    All terms defined in this Servicing Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.
(b)    The words “hereof,” “herein,” “hereunder,” and words of similar import when used in this Servicing Agreement shall refer to this Servicing Agreement as a whole and not to any particular provision of this Servicing Agreement; Section and Exhibit references contained in this Servicing Agreement are references to Sections and Exhibits in or to this Servicing Agreement unless otherwise specified; and the term “including” shall mean “including without limitation.”

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(c)    The definitions contained in this Servicing Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms.
 
ARTICLE II
Administration and Servicing of Loan Participations

Section 2.01.      General Servicing Provision.   The Loan Participation Servicer hereby agrees to service and administer the Loan Participations in accordance with the terms of this Servicing Agreement, applicable law, and the terms of the Participation Agreement and the Loan Participations, respectively.  In connection with such servicing and administration, the Loan Participation Servicer shall, consistent with and subject to all other servicing-related provisions in this Servicing Agreement and the Participation Agreement, have full power and authority, acting alone and/or through sub-servicers, to do or cause to be done any and all things, in connection with such servicing and administration, that the Loan Participation Servicer may deem necessary or desirable and consistent with the terms of this Servicing Agreement and the Loan Participation Servicer’s Customary Servicing Procedures.  The Loan Participation Servicer will exercise the same care in servicing the Loan Participations that it exercises in servicing loans to the same Borrower held in the Loan Participation Servicer’s portfolio.  The Loan Participation Servicer will act in the best interest of the Loan Participation Holder in servicing Loan Participations.  Without limiting the generality of the foregoing, the Loan Participation Servicer, in its own name or in the name of the Loan Participation Holder, is hereby authorized and empowered by the Loan Participation Holder, when the Loan Participation Servicer believes it appropriate in its reasonable judgment (subject to the terms of this Servicing Agreement, the Participation Agreement, and the applicable Certificate of Participation), to execute and deliver on behalf of the Loan Participation Holder any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments, with respect to the Loan Participations and with respect to the related Participated Loans. For the avoidance of doubt, until the occurrence of a Servicer Default, the Loan Participation Servicer shall be the sole point of contact with all Borrowers in the Participated Loans and the Loan Participation Holder will not contact any Borrower without the prior written consent of the Loan Participation Servicer. 
Section 2.02.      Agency Relationship.  The relationship of the Loan Participation Servicer (and of any successor to the Loan Participation Servicer as servicer under this Servicing Agreement) to the Loan Participation Holder under this Servicing Agreement is intended by the parties to be that of an independent contractor and not that of a joint venture, partner or agent.
Section 2.03.      Modifications, Waivers, Consents. In accordance with the terms of this Servicing Agreement, the Participation Agreement, and the applicable Certificate of Participation, the Loan Participation Servicer may waive, modify, amend or vary any term of any Loan Participation or consent to the postponement of strict compliance with any such term or in any manner grant indulgence to any Borrower if, in the Loan Participation Servicer’s judgment and consistent with Customary Servicing Procedures, such waiver, modification, consent, postponement or indulgence will make it more likely that such Borrower will be able to successfully repay the 

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Loan Participation in question.  Notwithstanding the foregoing, the Loan Participation Servicer shall not take or consent to any action, including any waiver, deferral or forbearance, or course of action without first obtaining the Loan Participation Holder’s prior written consent if such action or course of action requires the Loan Participation Holder’s consent or approval pursuant to the applicable Certificate of Participation.
(a)    To the extent the terms of any Participated Loan are modified or amended, the Loan Participation Servicer shall promptly notify the Loan Participation Holder of such modification or amendment and provide the Loan Participation Holder with updated data tapes or loan specifications that the Loan Participation Holder may reasonably request in a format reasonably acceptable to the Loan Participation Holder.  In addition to the foregoing, and regardless of whether any action is proposed to be taken by the Loan Participation Servicer with respect to a Loan Participation or a Participated Loan, the Loan Participation Servicer shall notify the Loan Participation Holder promptly after becoming aware of: (A) each event of default (as such term is defined in the documentation for the applicable Participated Loan) that has occurred and is continuing under the documentation for any Participated Loan, (B) any receipt of a notice of a Borrower’s violation or potential violation of applicable environmental laws pertaining to environmental hazards, (C) any proposed material change in the control or ownership of a Borrower, and (D) any material pending lawsuit involving a Borrower or Collateral which in the opinion of the Loan Participation Servicer would materially and adversely affect such Borrower’s ability to perform its obligations under the Loan Documents. Notwithstanding the foregoing, the Loan Participation Holder acknowledges and agrees that, with respect to any Participated Loan for which the Loan Participation Servicer is not the lender of record, the Loan Participation Servicer’s ability to waive, modify, amend or vary any term of the related Participated Loan, and its ability to exercise remedies with respect thereto, may be limited by its terms to the rights of all or a majority of interest holders in the Participated Loan.
Section 2.04.      Powers of Attorney.    Without limiting the generality of the foregoing, the Loan Participation Servicer is hereby authorized and empowered to execute and deliver on behalf of itself and the Loan Participation Holder all agreements and instruments as may be necessary or desirable in connection with the performance of its rights and obligations pursuant to this Servicing Agreement.  If reasonably required by the Loan Participation Servicer, the Loan Participation Holder shall furnish the Loan Participation Servicer with any powers of attorney and other documents necessary or appropriate to enable the Loan Participation Servicer to carry out its servicing and administrative duties under this Servicing Agreement, the Participation Agreement, and any other documentation pertaining to the Loan Participations and the Participated Loans.
Section 2.05.       Loan Participation Reporting.   The Loan Participation Servicer will provide the following reports to the Loan Participation Holder, which reports may be transmitted via e-mail to LoanAdministration@farmermac.com or in such other form as may be agreed between the Loan Participation Holder and the Loan Participation Servicer:
(i)    Not later than two (2) Business Days prior to the Pricing Date for a Loan Participation, the Loan Participation Servicer shall provide a Loan Setup File to the Loan Participation Holder with respect to each Loan Participation contemplated to be purchased by the Loan Participation Holder pursuant to Participation Agreement;

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(ii)    On the last day of each calendar month (or next succeeding Business Day), a Distribution Report;
(iii)    Within fifteen (15) days of the end of each Reporting Quarter, a Portfolio Risk Rating Report; 
(iv)    By not later than July 31 of each year, a Portfolio Financial Data Report; 
(v)    Within thirty (30) days after the Loan Participation Servicer adopts or implements any material changes to its Risk Rating Methodology, written notice thereof;
(vi)    Promptly after receipt, copies of audited financial statements that the Loan Participation Servicer receives with respect to each Borrower in accordance with the Loan Documents; and
(vii)    Promptly after approval by the Loan Participation Servicer, any annual credit analysis (including risk rating) on a Borrower that is prepared by the Loan Participation Servicer for its own credit review process in the course of its ordinary business practices, subject to the qualifications set forth in Section 6 of the Participation Agreement.
Section 2.06.      Remittances.   The Loan Participation Servicer will proceed diligently and promptly to (i) collect all payments due under each of the Loan Participations it services when the same shall become due and payable and (ii) remit all payments due to the Loan Participation Holder in respect of each Loan Participation (net of amounts permitted to be withheld hereunder and/or under the Participation Agreement) in accordance with the Participation Agreement.  All funds held by the Loan Participation Servicer in respect of each Loan Participation (net of amounts permitted to be withheld under the Participation Agreement) shall be held in trust for the benefit of the Loan Participation Holder until remitted to the Loan Participation Holder.
Section 2.07.      Realization Upon Defaulted Loans.
(a)    The Loan Participation Servicer shall use reasonable efforts to realize upon Defaulted Loans in such manner as in the Loan Participation Servicer’s judgment will maximize the receipt of principal and interest by all interest holders of the Participated Loan, including the Loan Participation Holder.  For each Participated Loan as to which the Loan Participation Holder’s Pro Rata Share exceeds fifty percent (50%):
(i)    the Loan Participation Servicer shall use reasonable efforts to work out a troubled Participated Loan before proposing foreclosure, a deed in lieu of foreclosure, a pre-foreclosure sale, or otherwise liquidating Collateral;
(ii)    the Loan Participation Servicer shall use reasonable efforts to liquidate or otherwise comparably convert the ownership of Collateral securing such of the Participated Loans as come into and continue in default and as to which no satisfactory arrangements can be made for collection of delinquent payments;

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(iii)    in any case in which Collateral shall have suffered material damage and in the opinion of the Loan Participation Servicer there are insufficient funds or no reasonable likelihood that there will be sufficient funds received in the future from insurance proceeds, any federal or state governmental agency or any other sources, the Loan Participation Servicer shall promptly notify the Loan Participation Holder to allow it the opportunity to expend funds toward restoration; and
(iv)    the decision of the Loan Participation Servicer to foreclose on a Defaulted Loan or otherwise liquidate Collateral shall be subject to the written consent of the Loan Participation Holder as set forth in the applicable Certificate of Participation.
(b)    Any proceeds from liquidated Collateral to which the Loan Participation Holder is entitled will be paid first, to the Loan Participation Servicer for previously unreimbursed Expenses under the Participation Agreement; second, to the Loan Participation Servicer, for payment of any unpaid Servicing Fee with respect to the Loan Participation relating to such Collateral; third, to the Loan Participation Holder in respect of accrued interest; and fourth, to the Loan Participation Holder as a recovery of principal of such Loan Participation.
Section 2.08.      Servicing Compensation and Reimbursement.  The Loan Participation Servicer shall be entitled to an amount equal to the accrued and unpaid Servicing Fee with respect to each Loan Participation.  The Servicing Fee shall be paid in arrears, and the Loan Participation Servicer shall be entitled to retain an amount equal to the accrued and unpaid Servicing Fee with respect to each Loan Participation out of the interest portion of amounts collected by the Loan Participation Servicer with respect to such Loan Participation; provided, that any accrued and unpaid Servicing Fee may only be withheld from future interest payments on the Loan Participation for which the unpaid Servicing Fee accrued.  Notwithstanding the foregoing, the Servicing Fee shall only be retained by the Loan Participation Servicer in each month that the Loan Participation Holder receives interest in full for such month in respect of the Loan Participation for which the Servicing Fee would have been retained.  The Loan Participation Servicer shall be required to pay all expenses incurred by it in connection with its servicing activities hereunder and shall not be entitled to reimbursement therefor except as specified herein and in the Participation Agreement.
Section 2.09.      Servicer Default.  
(a)    Each of the following events shall constitute a servicer default (each, a “Servicer Default”):
(i)    any default by the Loan Participation Servicer as “Lead Lender” under the Participation Agreement that remains unremedied within the timeframe(s) specified therein; or
(ii)    failure on the part of the Loan Participation Servicer duly to observe or perform in any material respect any of the covenants or agreements on the part of the Loan Participation Servicer in this Servicing Agreement which continues unremedied for a period of forty-five (45) days after the date on which written notice of such failure, requiring the 

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same to be remedied, shall have been received by the Loan Participation Servicer from the Loan Participation Holder; or
(iii)    a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator, receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against the Loan Participation Servicer and such decree or order shall have remained in force undischarged or unstayed for a period of sixty (60) days; or
(iv)    consent by the Loan Participation Servicer to the appointment of a conservator, receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings relating to the Loan Participation Servicer or to all or substantially all of its property; or
(v)    the Loan Participation Servicer’s admission in writing of its inability to pay its debts generally as they become due, filing of a petition to invoke any applicable insolvency or reorganization statute, making of an assignment for the benefit of its creditors, or voluntarily suspending payment of its obligations; or
(vi)    a court of competent jurisdiction shall have found that the Loan Participation Servicer or any of its senior executive officers has committed an act of civil fraud; or
(vii)    the Loan Participation Servicer or any of its principal officers shall have been convicted of any criminal act related to the Loan Participation Servicer’s lending or mortgage selling or servicing activities;
(viii)    the Loan Participation Servicer consummates a transaction that results in a Change of Control; or
(ix)    the Loan Participation Servicer ceases to be in good standing under the laws of its governing jurisdiction for a period of thirty (30) days following notice thereof by any governmental authority having jurisdiction over such determination.
(b)    Upon the occurrence of a Servicer Default, and so long as such Servicer Default shall not have been remedied, the Loan Participation Holder may (a) terminate all obligations and duties imposed upon the Loan Participation Servicer under this Servicing Agreement, and (b) name and appoint a successor or successors (including itself) to succeed to and assume all of such obligations and duties of the Loan Participation Servicer.  Such actions shall be effected by notice in writing to the Loan Participation Servicer and shall become effective upon receipt of such notice by the Loan Participation Servicer and the acceptance of such appointment by such successor or successors. 
Section 2.10.      Resignation and Termination of Loan Participation Servicer. The Loan Participation Servicer may at any time resign and terminate its obligations under this Servicing Agreement upon at least one hundred eighty (180) days’ prior written notice to the Loan Participation 

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Holder; provided, however, that no such resignation or termination shall be effective until a successor servicer reasonably acceptable to the Loan Participation Holder is appointed (and accepts such appointment). Notwithstanding the foregoing, if a successor servicer has not been appointed within two hundred seventy (270) days following the delivery of a notice of resignation by the Loan Participation Servicer, the Loan Participation Servicer may (but shall not be obligated to) resign notwithstanding the lack of appointment of a successor.
Section 2.11.      Inspection Rights.   The Loan Participation Servicer shall, upon three (3) Business Days’ prior written request from the Loan Participation Holder, during normal business hours, permit the Loan Participation Holder to examine, inspect, and/or audit the servicing files and servicing controls which relate to Loan Participations.  These inspection rights shall extend to representatives of the Farm Credit Administration (as the governmental authority that regulates the Loan Participation Holder).
Section 2.12.      Limitation on Liability of the Loan Participation Servicer and Others.   Neither the Loan Participation Servicer nor any of the directors, officers, employees or agents of the Loan Participation Servicer shall be under any liability to the Loan Participation Holder for any action taken or for refraining from the taking of any action in good faith and without gross negligence pursuant to this Servicing Agreement or for errors in judgment; provided, however, that this provision shall not protect the Loan Participation Servicer or any such Person against (i) any breach of warranties or representations made herein or (ii) any liability which would otherwise be imposed (A) by reason of willful misfeasance, bad faith or gross negligence in the performance of duties hereunder or (B) by the terms of the Participation Agreement.  The Loan Participation Servicer and any director, officer, employee or agent of the Loan Participation Servicer shall be indemnified by the Loan Participation Holder and held harmless by the Loan Participation Holder against any loss, liability or expense incurred in connection with any legal action relating to this Servicing Agreement, the transactions contemplated hereby or thereby, and the Loan Participation Servicer’s duties in connection therewith, other than any unrecovered Servicing Fee related to any specific Loan Participation(s) and any loss, liability or expense incurred (i) by reason of willful misfeasance, bad faith or gross negligence in the performance of duties hereunder or (ii) in accordance with the Participation Agreement.
Section 2.13.      Statements and Certificates to Loan Participation Holder.
(a)    Not later than January 30 of each year (or if such day is not a Business Day, the next succeeding Business Day) beginning in 2020, the Loan Participation Servicer shall deliver to the Loan Participation Holder an Annual Officer’s Certificate for the prior calendar year.  The Loan Participation Servicer shall also provide such assertion letters and attestation reports as the Loan Participation Holder may require to reasonably comply with applicable laws and regulations, the form of which letters and reports shall be agreed upon between the Loan Participation Holder and the Loan Participation Servicer.  The Loan Participation Servicer agrees to indemnify and hold harmless each of the Loan Participation Holder, each person or entity, if any, who “controls” the Loan Participation Holder within the meaning of the Securities Act of 1933, as amended, and their respective officers and directors (collectively, the “Indemnitees”) against any and all losses, damages, penalties, fines, forfeitures, legal fees and related costs, judgments and any other costs, 

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fees and expenses that any Indemnitee may sustain arising out of third party claims (including any criminal or civil action brought by a government agency or department) based on the failure of the Loan Participation Servicer to deliver or cause to be delivered when required the foregoing Annual Officer’s Certificate or any material misstatement or material omission therein.  If the indemnification provided for herein is unavailable or insufficient to hold harmless any Indemnitee, then the Loan Participation Servicer agrees that it shall contribute to the amount paid or payable by the Indemnitee as a result of the losses, claims, damages or liabilities of the Indemnitee in such proportion as is appropriate to reflect the relative fault of the Indemnitee on the one hand and the Loan Participation Servicer on the other.
(b)    Not later than the end of the Loan Participation Servicer’s first fiscal quarter of each year (or if such day is not a Business Day, the next succeeding Business Day) beginning in 2020, the Loan Participation Servicer shall deliver to the Loan Participation Holder a copy of the report of independent accountants with respect to the Loan Participation Servicer’s consolidated financial statements for the preceding fiscal year.

ARTICLE III
Representations and Warranties

Section 3.01.      Representations and Warranties of the Loan Participation Servicer.   The Loan Participation Servicer hereby represents and warrants as of the date of this Servicing Agreement and each Sale Date as follows:
(a)    The Loan Participation Servicer is duly organized, validly existing and in good standing under the laws governing its creation and existence and with the requisite power and authority to conduct its business as it is currently being conducted; the Loan Participation Servicer holds all licenses, certificates and permits necessary for the conduct of its business as it is currently being conducted and is or will be in compliance with the laws of each state in which any Collateral is located to the extent necessary to ensure the enforceability of each Participated Loan.
(b)    The Loan Participation Servicer has the requisite power and authority to execute and deliver this Servicing Agreement, to service and administer all the Loan Participations in accordance with the terms of this Servicing Agreement, and to take all other actions and execute and deliver all other documents which are requisite or pertinent to the transactions described in this Servicing Agreement.  The persons signing such documents and taking such actions on its behalf have been duly authorized to do so and such documents and actions are valid, legally binding and enforceable against the Loan Participation Servicer in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors’ rights and to general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law).
(c)    The Loan Participation Servicer is not required to obtain any consents, licenses, approvals or authorizations from, or registrations or declarations with, any person, governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Servicing Agreement, except for such consents, licenses, approvals or 

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authorizations, or registrations or declarations, as shall have been obtained or filed, as the case may be.
(d)    No action, suit or proceeding is pending or, to the best of the Loan Participation Servicer’s knowledge, threatened against it that would prohibit it from entering into this Servicing Agreement or performing its obligations under this Servicing Agreement or, in the reasonable opinion of the Loan Participation Servicer has a reasonable likelihood of resulting in a material adverse effect on the transactions contemplated by this Servicing Agreement.
(e)    The Loan Participation Servicer is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal, state, municipal or governmental agency, which default would reasonably be expected to have consequences that would materially and adversely affect the condition (financial or otherwise) or operations of the Loan Participation Servicer or its respective properties or would reasonably be expected to have consequences that would materially adversely affect the performance of the Loan Participation Servicer hereunder.
(f)    The execution and delivery of this Servicing Agreement by the Loan Participation Servicer and the performance and compliance with the terms of this Servicing Agreement by the Loan Participation Servicer will not violate the organizational and operational documents of the Loan Participation Servicer, or constitute a material default (or an event which, with notice or lapse of time, or both, would constitute a material default) under, or result in the material breach of, any material contract, agreement or other instrument to which the Loan Participation Servicer is a party or which may be applicable to the Loan Participation Servicer, or any of its assets.
(g)    No Servicer Default has occurred and is continuing and no event or circumstance has occurred or exists which, with notice or lapse of time or both, would constitute a Servicer Default.
Section 3.02.      Representations and Warranties of the Loan Participation Holder.  The Loan Participation Holder hereby represents and warrants as of the date of this Servicing Agreement and each Sale Date as follows:
(a)    The Loan Participation Holder is a corporation duly organized, validly existing and in good standing under the laws governing its creation and existence and with the requisite power and authority to conduct its business as it is currently being conducted; the Loan Participation Holder holds all licenses, certificates and permits necessary for the conduct of its business as it is currently being conducted and is or will be in compliance with the laws of each state in which any Collateral is located to the extent necessary to ensure the enforceability of each Loan Participation.
(b)    The Loan Participation Holder has the requisite power and authority to execute and deliver this Servicing Agreement and to take all other actions and execute and deliver all other documents which are requisite or pertinent to the transactions described in this Servicing Agreement.  The persons signing such documents and taking such actions on its behalf have been duly authorized to do so and such documents and actions are valid, legally binding and enforceable against the Loan Participation Holder in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors’ rights 

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and to general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law).
(c)    The Loan Participation Holder is not required to obtain any consents, licenses, approvals or authorizations from, or registrations or declarations with, any person, governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Servicing Agreement, except for such consents, licenses, approvals or authorizations, or registrations or declarations, as shall have been obtained or filed, as the case may be.
(d)    No action, suit or proceeding is pending or, to the best of the Loan Participation Holder’s knowledge, threatened against it that would prohibit it from entering into this Servicing Agreement or performing its obligations under this Servicing Agreement or, in the reasonable opinion of the Loan Participation Holder has a reasonable likelihood of resulting in a material adverse effect on the transactions contemplated by this Servicing Agreement.
(e)    The Loan Participation Holder is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal, state, municipal or governmental agency, which default would reasonably be expected to have consequences that would materially and adversely affect the condition (financial or otherwise) or operations of the Loan Participation Holder or its respective properties or would reasonably be expected to have consequences that would materially adversely affect the performance of the Loan Participation Holder hereunder.
(f)    The execution and delivery of this Servicing Agreement by the Loan Participation Holder and the performance and compliance with the terms of this Servicing Agreement by the Loan Participation Holder does not violate the organizational and operational documents of the Loan Participation Holder, or constitute a material default (or an event which, with notice or lapse of time, or both, would constitute a material default) under, or result in the material breach of, any material contract, agreement or other instrument to which the Loan Participation Holder is a party or which may be applicable to the Loan Participation Holder, or any of its assets.
Section 3.03.      Remedies for Breach of Representations and Warranties.   Upon discovery by any party hereto of a breach of any of the representations and warranties set forth herein, such discovering party shall give prompt written notice to the other party.  It is understood and agreed by the parties hereto that the representations and warranties set forth herein will continue in full force and effect for the remaining life of all Loan Participations, notwithstanding termination of this Servicing Agreement for any reason.

ARTICLE IV
Miscellaneous

Section 4.01.      Governing Law.   The terms of this Servicing Agreement shall be governed by, and construed in accordance with, federal law.  To the extent federal law incorporates state law, that state law shall be the laws of the State of Colorado.

12

Section 4.02.      WAIVER OF JURY TRIAL.   THE PARTIES HERETO EACH IRREVOCABLY 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 THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY).
Section 4.03.      Demands, Notices, Communications.   All formal demands, notices and communications by and between the Loan Participation Servicer, and Loan Participation Holder shall be in writing and delivered in person or by an overnight delivery service, in each case with proof of delivery, to the following addresses (or such other address or location that each party may deliver to the other in writing from time to time): 
If to the Loan Participation Holder:
Federal Agricultural Mortgage Corporation 
1999 K Street, N.W., 4th Floor 
Washington, DC 20006 
Attention of: Chief Credit Officer
Email:    ccovington@farmermac.com
Email:    tmclaughlin@farmermac.com
With a copy (which shall not constitute notice) to:
Federal Agricultural Mortgage Corporation 
1999 K Street, N.W., 4th Floor 
Washington, DC 20006 
Attention of: General Counsel 
Email:    legal@farmermac.com
With a copy (which shall not constitute notice) to:
Federal Agricultural Mortgage Corporation 
1999 K Street, N.W., 4th Floor 
Washington, DC 20006 
Attention of: Institutional Business Development 
Email:    feainfo@farmermac.com
If to Loan Participation Servicer:
CoBank, ACB and CoBank, FCB 
6340 S. Fiddlers Green Circle 
Greenwood Village, Colorado  80111 
Attention of:  Bill Fox 
Email:  bfox@cobank.com 
Email:  MB_CapitalMarkets@cobank.com

13

Any notice so delivered within the time prescribed in this Servicing Agreement shall be conclusively presumed to have been duly given whether or not the intended recipient receives such notice, provided, however, that the party giving such notice has received proof of delivery. 
Section 4.04.      Severability of Provisions.   If any one or more of the covenants, agreements, provisions or terms of this Servicing Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Servicing Agreement and shall in no way affect the validity or enforceability of the other provisions of this Servicing Agreement.
Section 4.05.      Amendment.   This Servicing Agreement may be amended from time to time or the provisions hereof may be waived or otherwise modified by the parties hereto only by written agreement signed by the parties hereto.
Section 4.06.      Counterparts.   This Servicing Agreement may be executed in any number of counterparts, each of which counterparts shall be deemed to be an original, and such counterparts shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page of this Servicing Agreement by facsimile or other electronic means shall be effective as delivery of a manually executed counterpart of this Servicing Agreement.
Section 4.07.      Authorized Officers.   The manual or facsimile signature of any individual appearing on this Servicing Agreement, or any document or certificate issued pursuant to this Servicing Agreement, shall constitute conclusive evidence that such individual is, in fact, authorized to execute such document, notwithstanding that such authorization may have lapsed prior to the effective date of such document.
Section 4.08.      Assignability.   Except as provided in Section 5.12, this Servicing Agreement shall not be assigned by either of the parties hereto without the prior written consent of the other party.  For purposes of this Section only, it is agreed that delegation by the Loan Participation Servicer permitted pursuant to one or more subservicers shall not be deemed an attempted assignment or transfer of servicing prohibited by this Servicing Agreement.  Any attempted assignment or transfer contrary to the provisions of this Section shall be null, void, and of no force or effect. 

[SIGNATURES FOLLOW ON NEXT PAGE]

14

IN WITNESS WHEREOF, the parties hereto hereby execute this Servicing Agreement as of the day and year first above written.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION, as Loan Participation Holder

By:  /s/ John C. Covington                             
Name: John C. Covington
Title: Executive Vice President - Chief Credit Officer

COBANK, ACB, as Loan Participation Servicer

By:  /s/ Eric Itambo                                          
Name: Eric Itambo
Title: Chief Banking Officer

[Signature Page to Servicing Agreement]

EXHIBIT A
FORM OF ANUUAL OFFICER’S CERTIFICATE
I, [name of certifying individual], a duly elected and acting officer of CoBank, ACB (the “Loan Participation Servicer”), certify pursuant to the Loan Participation Servicing Agreement dated as of February 13, 2019 (as it may be amended from time to time, the “Servicing Agreement”) between the Loan Participation Servicer and Federal Agricultural Mortgage Corporation (“Farmer Mac”) to Farmer Mac and each person or entity, if any, who “controls” Farmer Mac within the meaning of the Securities Act of 1933, as amended, and their respective officers and directors, with respect to the calendar year immediately preceding the date of this Certificate (the “Relevant Year”), as follows:

1.    I am responsible for reviewing the activities performed by the Loan Participation Servicer under the Servicing Agreement during the Relevant Year.
2.    Based upon the review required by the Servicing Agreement and except as disclosed in this Officer’s Certificate or in any accountants’ statement provided pursuant to the Servicing Agreement, to the best of my knowledge, the Loan Participation Servicer has fulfilled all of its obligations under the Servicing Agreement throughout the Relevant Year.
3.    The Loan Participation Servicer has a comprehensive disaster recovery and business continuity plan that includes the following elements:
(a)    duplication of the Servicer’s production information systems at an off-site facility coupled with an extensive business recovery plan to utilize those remote systems; 

(b)    replication of the Loan Participation Servicer’s production data in real time to the recovery site;

(c)    processes for each of the Loan Participation Servicer’s operating groups to conduct business with a view to minimizing disruption for customers;

(d)    periodic disaster recovery exercises that include both the information technology group and business areas;

(c)    contracts with an external vendor for facilities to house the Loan Participation Servicer’s backup systems as well as office space and related office equipment; and

(d)    backup tapes stored at an off-site storage location managed by an external vendor.

4.    With respect to the Collateral, except as identified in writing to Farmer Mac, the Loan Participation Servicer has received no notification of a delinquency in the payment of any premiums, assessments, taxes or other charges that may become liens having precedence over the related Collateral.

ExhA-1

5.    For purposes of this Officer’s Certificate, “Relevant Information” means the information included herein for the Relevant Year and the information in all Distribution Reports provided by the Loan Participation Servicer pursuant to Section 2.05 of the Servicing Agreement during the Relevant Year.  To the best of my knowledge, the Relevant Information, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein which is necessary to make the statements made therein, in light of the circumstances under which such statements were made, not misleading as of the last day of the Relevant Year.
DATED as of _______________.

	
	
	

_________________________________________

Name:___________________________________ 

Title:  

ExhA-2

EXHIBIT B
DISTRIBUTION REPORT (FORM)
(Attached behind this page)

ExhB-1

Distribution Report

	
								
	Coop ID
	CoBank Loan Num
	CPED Date
	Beginning Balance
	Scheduled Principal Payment during remittance period
	Unscheduled Principal Payment during remittance period
	Ending Actual Balance
	Ending Scheduled Balance

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	Final Payoff Date
	Unscheduled Principal Payment date
	Payment Date
	Index Rate
	Margin
	Index Type
	Note Rate
	CoBank Servicing Fee

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	Net Rate to Farmer Mac
	CoBank Servicing Amount
	Last Interest Paid To Date
	Next Due Date
	Next Interest Reset Date
	Sale Date
	Maturity Date
	Total P&I Payment

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	Prepayment Penalty Amount
	Accrual Method
	Previous Month Unpaid Net Interest
	Interest Accrual During Reporting Period
	Interest Payment
	Current Month Unpaid Net Interest
	Days Accrued
	Delinquency Code

	 
	 
	 
	 
	 
	 
	 
	 

ExhB-2

EXHIBIT C
LOAN SETUP FILE (FORM)
(Attached behind this page)

ExhC-1

	
																			
	Set Up File
	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	Coop ID
	Coop Name
	CoBank Loan Num
	Loan Amount
	Sale Date
	Final Payment Date
	Maturity Date
	Amortization End Date
	Servicing Fee (bps)
	Payment Frequency

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	
										
	Next Payment Date
	Interest Rate Term
	Remaining Loan Term
	Remaining Amort Term
	Org Class
	Effective Date
	Servicing Adjusted Rate
	Prepayment Penalty
	Prepayment Penalty Type
	Prepayment Penalty expire date

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

ExhC-2

EXHIBIT D
PORTFOLIO FINANCIAL DATA REPORT (FORM)
(Attached behind this page)

ExhD-1

Financial Data

	
								
	CoopID
	Coop Year
	dep_amort_exp
	interest_ltd_exp
	patcap_op_ margins
	non_op_margins_ interest
	g_and_t_capital_ credits
	other_capital_credits_pat_div

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	net_utility_plant
	invest_in_assoc_org_patcap
	tot_assets_other_debits
	tot_margins_equities
	tot_ltd
	long_term_lease_rental_tot
	tot_pmt_ltd_bc
	tot_pmt_ltd_ffb

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	tot_pmt_ltd_rus_ edl
	tot_power_ purchase
	tot_ sales
	op_exp_ ratio
	capacity
	construction_ pct
	tot_pmt_ltd_ other1
	tot_pmt_ltd_ other2

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	tot_pmt_ltd_other3
	tot_pmt_ltd_other4
	tot_pmt_ltd_other5
	tot_pmt_ltd_other6
	tot_pmt_ltd_other7
	tot_pmt_ltd_other8
	tot_pmt_ltd_other9
	tot_pmt_ltd_other10

	 
	 
	 
	 
	 
	 
	 
	 

	
								
	bill_debt_service_tot
	rus_bill_debt_service_tot
	int_income
	tot_debt
	ebitda
	EtC
	EA
	MDSC

	 
	 
	 
	 
	 
	 
	 
	 

	
							
	LTDNUP
	FacilityRisk Rating
	Consumer Served
	RevenuePer KWH
	Residential Sale
	PowerCostper KWH
	TotalOperating Expense

	 
	 
	 
	 
	 
	 
	 

ExhD-2

EXHIBIT E
PORTFOLIO RISK RATING REPORT (FORM)
(Attached behind this page)

ExhE-1

	
			
	Risk Rating Report
	 
	 

	 
	 
	 

	Coop ID
	cobank_risk_rating
	CPED

	 
	 
	 

ExhE-2Exhibit

Exhibit 10(e)

PITNEY BOWES INC.
KEY EMPLOYEES INCENTIVE PLAN
(As Amended and Restated: February 4, 2019)

		
	1.
	PURPOSE

		
	(A)
	The Pitney Bowes Inc. Key Employees Incentive Plan (the "Plan") is designed to provide additional cash incentives for key employees of Pitney Bowes Inc. (the "Company") and its subsidiaries and affiliates by the making of awards of supplemental compensation related to the achievement of certain performance criteria specified from time to time by the Company.  It is intended that such awards will be given in a way designed to retain or attract, and to provide additional incentive to key employees in order to align their efforts with the Company and its stockholders.

(B)The Plan shall award short-term incentives in the form of annual cash incentives, long-term cash-based incentives (e.g., Cash Incentive Units), and such other cash incentives as the Company deems reasonable and appropriate from time to time (e.g., retention awards).

		
	2.
	ELIGIBILITY

(A)  Key employees of the Company and its subsidiaries and affiliates shall be eligible for awards under the Plan. The Committee, as defined in Section 7, shall determine from time to time who is a key employee of the Company and its subsidiaries and affiliates.

		
	3.
	AWARDS & PAYMENT

(A)From time to time, the Committee may make awards to such key employees as it determines to be appropriate under the terms of the Plan. All awards under the Plan shall be made on such terms and subject to such conditions as the Committee may determine, including the following:

(i)    The Committee shall decide who shall receive awards for the year, and shall make rules determining how each award is to be calculated.    Awards maybe made in cash, units ("as defined in subparagraph (ii)), or any combination thereof, as may, in the judgment of the Committee be best calculated to further the purposes of the Plan. 

(ii)    Amounts paid to a Key Employee during any fiscal year of the Company shall not exceed the maximum amount of $5,000,000 for annual awards and $15,000,000 for Units.

(iii)    A "Unit" is an award which entitles the recipient to receive cash in an amount which is calculated based upon the business performance of the Company or any of its divisions, subsidiaries, or affiliates during a stated period ("Cash Incentive Unit or Unit"). The Company may base the Cash Incentive Unit award on the achievement of one or more pre-established objective performance measures listed in Section 9(C), or any other indicator specified by the Committee. The Committee shall fix the period during which such performance is to be measured (the "Cycle"), the time at which the value of the Units is to be paid, and the form of the payment to be made in respect of the Units. The Board may determine from time to time that a Unit award shall be settled in whole or in part in Company stock. The Units shall be awarded under the "Pitney Bowes Cash Incentive Units Program."

1

(iv)    All other cash awards made under the Plan, other than Units described in subparagraph (ii) above, are referred to as "Incentive Awards," which shall include "Annual Incentive Awards" made under the Pitney Bowes Incentive Program. Incentive Awards may be based on a participant's incentive target, individual performance, the achievement by the organization or business unit of one or more pre-established objective performance measures listed in Section 9(C) or any other measure that the Company determines appropriate to meet the purposes of the Plan.

(v)    The making of awards under this Plan and the calculation of the award value by the Company is made at the discretion of the Company and is final binding and conclusive on all parties. Awards made under this Plan both rewards past performance and incentivizes future performance.

(B)Payments with respect to maturing Cash Incentive Units shall be paid between February 1 and March 15 of the calendar year following the final year in the Cycle. Payments to participants who reside outside the United States shall be made in such currencies and such exchange rates as are consistent with the patterns and practices under this Plan as well as local patterns and practices. Annual Incentive Awards shall be paid no later than March 15 of the calendar year following the year for which the Incentive Awards were earned. All other cash awards made under this Plan shall be paid and governed pursuant to the terms of the written award document or notification.

		
	(C)
	The Committee may from time to time establish rules and procedures pursuant to which participants will be permitted or required to defer receipt of Incentive Awards or Units under the Company's Deferred Incentive Savings Plan.

		
	4.
	RETIREMENT, DISABILITY, DEATH, LEAVE OR TERMINATION

(A)If a participant's employment with the Company terminates for any reason before the distribution or payment of an Annual Incentive Award or a Cash Incentive Unit award, the award will be forfeited and will not be paid, except as provided in this Section or except as otherwise determined by the Committee.

(B)Incentive Award. If the participant's employment ceases on account of:

(i)    Retirement (or bridged to Retirement pursuant to a written severance agreement), Total Disability as defined under the Company's disability plans or because of a
Company-approved leave of absence, the participant shall be entitled to payment of the Annual Incentive Award on a pro-rata basis. ("Retirement" is defined as in the Pitney Bowes Pension Plan.) The payment will be based on the number of days the participant was actively employed during the performance measurement period, the participant's incentive percentage based on performance targets met and the participant's salary during the performance period. The payment will be made when the award otherwise would be paid whether or not the participant is actively employed at the time the payment is scheduled to be made. Actively employed for purposes of this Plan means the participant is physically at work or on a Company-approved paid leave of absence.

(ii)    In the event of death during the performance year, the award will be pro-rated and paid to the participant's spouse or designated beneficiary, or if none, to the participant's estate.

(iii)    If the participant terminates employment under the terms of a written severance agreement, the Company may, in its sole discretion, provide (a) in the event of a nonretirement eligible employee that all or a pro-rata portion of the participant's award is earned by and payable to the participant, or (b) in the event of a retirement eligible employee that the participant's award will be paid at the time of termination from employment in lieu of when the Annual Incentive Award is normally paid under the program.

2

(iv)    In the event of a sale, spin-off or outsourcing of a business or business unit, the Company shall determine whether eligible participants are entitled to an Incentive Award and the criteria to be used in calculating the award.

(C)Cash Incentive Unit. If the participant's employment ceases on account of:

(i)    Retirement (or bridged to Retirement pursuant to a written severance agreement), or Total Disability as defined under the Company's disability plans, the participant will be entitled to payment of the Cash Incentive Units on a pro-rated basis based on the number of full calendar rnonths of service during the Cycle through the date of Retirement or Total Disability. ("Retirement" is defined as in the Pitney Bowes Pension Plan.)  During a paid leave of absence, Family Medical Leave Act of 1993 and military leaves of absence, and disability leave where the participant is receiving benefits under the Company's disability benefit plans, the participant will be treated as actively employed with respect to the participant's outstanding Cash Incentive Unit awards. The payment of the Cash Incentive Unit will be made when the award is otherwise paid to the other eligible participants, whether or not the participant is actively employed at the time the payment is scheduled to be made. A participant will be considered actively at work if physically at work or on a Company-approved paid leave of absence.

(ii)    In the event of death during a performance cycle, the award will be pro-rated through the date of death based on the full calendar month of service and will be paid to the participant's spouse or designated beneficiaries, or if none, to the participant's estate. The payment will be made when the award is otherwise paid to other eligible participants.

(iii)    If the participant terminates employment under the terms of a written severance agreement but is not otherwise retirement eligible, Cash Incentive Units outstanding for 12 months or more from the date of termination will be paid on a pro-rated basis based on the number of full calendar months of service during the Cycle through the last day of work. The payment will be made when the award is otherwise paid to other eligible participants. Cash Incentive Units outstanding less than 12 months from the date of termination shall be forfeited.

(iv)    In the event of a sale, spin-off or outsourcing of a business or business unit, Cash Incentive Units will be paid on a pro-rated basis based on the number of full calendar months' of service during the Cycle through the last day of work.

(D)Recoupment. In the event of a restatement of the Company's financial results which consists of a misrepresentation of the financial state of the Company for purposes of the Securities Exchange Act of 1934, the Board, or its delegate, may, upon review of the facts and circumstances, take necessary and appropriate actions including adjusting, recouping or forfeiting any awards made or paid under this Plan to executive officers during the past 36 months where the payment or award was predicated upon the achievement of certain financial results that were subsequently subject of a restatement. 

In addition the Board, or its delegate, may adjust, recoup or forfeit any award made or paid under this Plan to any employee if the Board, or its delegate, reasonably believes that a Participant has (i) breached a covenant under the Proprietary Interest Protection Agreement ("PIP") executed by the employee or (ii) engaged in Gross Misconduct, where Gross Misconduct includes (a) the conviction of a felony, or crime of similar magnitude, in connection with the performance or non-performance of the employee's duties or (b) the willful act or failure to act in a way that results in material injury to the business or its employees. "Material injury" for this purpose means substantial and not inconsequential as determined by the Board or its delegate. The Board, or its delegate, shall determine in its/their sole discretion whether there has been a Gross Misconduct. The Board, or its delegate, will take into account the timing and magnitude of the injury to the business in determining the extent of adjustment, recoupment or forfeiture.

3

(E)The Company, in its sole discretion, shall determine whether there has been a Gross Misconduct and the Company's determination shall be final, conclusive and binding on all parties.

		
	5.
	CHANGE OF CONTROL

Notwithstanding anything in the Plan to the contrary, if a Change of Control occurs, the following provisions shall apply:

(A)Annual Incentive Awards. A participant, who has previously been notified by the Company that he or she was eligible to receive an Annual Incentive Award for the year in which the Change of Control occurs, shall be paid a target incentive award for the calendar year of the Change of Control. The award shall be paid on the date on which Annual Incentive Awards would otherwise have been paid absent a Change of Control notwithstanding, except if a participant suffers a termination of employment on account of a Change of Control as defined under the Pitney Bowes Senior Executive Severance Policy, such participant shall be paid a prorated target incentive award no later than fifteen (15) days after the participant terminates employment.

(B)Cash Incentive Units. In the event of a Change of Control, all outstanding Cash Incentive Unit awards shall be valued at target, as established for each outstanding Cycle, and paid on the date on which such Cycle would otherwise be paid absent a Change of Control, except if a participant suffers a termination of employment on account of a Change of Control as defined under the Pitney Bowes Senior Executive Severance Policy, such participant shall be paid no later than fifteen (15) days after the participant terminates employment.

(C)For purposes of this Plan, a "Change of Control" and "Termination of Employment" shall be defined as provided in the Pitney Bowes Senior Executive Severance Policy from time to time.

(D)The foregoing is intended to set forth the minimum amount of Annual Incentive Award and Cash Incentive Unit payments that shall be made in the circumstances described above but are not intended to limit any additional payments that the Committee may desire to make as in its discretion it deems appropriate.

(E)Any right to a payment as provided in this Section shall be a contract right of the key employees as herein described, enforceable against the Company, its assigns and successors. Upon and following the occurrence of a Change of Control, any decision rendered pursuant to this

Section 5 may be contested by any claimant, and the Company agrees to pay, to the full extent permitted by law, all legal fees and expenses which a claimant may reasonably incur as a result of any contest, provided the claimant substantially prevails in the outcome thereof.

		
	6.
	NO ASSIGNMENT

(A)No award, and no right under any award shall be assignable, alienable, saleable, or transferable by a participant other than by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order as defined in the Code (as defined below), or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder; provided however, that if so determined by the Committee, a participant may in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of the participant, and to receive any cash distributable, with respect to any award upon the death of the participant. Each award, and each right under any award, shall be issuable or payable only to the participant, or, if permissible under applicable law, to the participant's guardian or legal representative or to a transferee receiving such award pursuant to a qualified domestic relations order referred to above. No award, and no right under any such award, may be pledged, alienated, attached, or otherwise encumbered and any purported pledge, alienation, attachment, or encumbrance thereof shall be void and unenforceable against the Company or any affiliate.

4

		
	7.
	ADMINISTRATION

(A)The Plan shall be administered by a committee designated by the Board of Directors to administer the Plan (the "Committee"). 

(B)The Committee may establish rules for the administration of the Plan and may make administrative decisions regarding the Plan and awards hereunder. The Committee may delegate its functions hereunder to the extent consistent with applicable law.

(C)Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the Plan, any award, or any award agreement or certificate shall be with and in the sole discretion of the Committee, may be made at any time, and shall be final, conclusive, and binding upon all persons, including the Company, any affiliate, any participant, any holder or beneficiary of any award, and any employee of the Company or of any affiliate.

		
	8.
	PLAN AMENDMENT AND TERMIINATION

(A)The Committee may amend, suspend, or terminate the Plan in whole or in part at any time, provided, however, that if in the judgment of the Committee such amendment or other action would have a material effect on the Plan, such amendment or other action must be taken by the Board of Directors of the Company. No amendment which would materially increase the cost of the Plan shall be made effective unless approved by the shareholders of the Company. This Plan may not be amended, suspended or terminated from and after the date of a Change of Control as defined above) or in anticipation of a Change of Control so as to reduce or otherwise adversely affect the benefits to which participants  in the Plan are entitled upon a Change  of   Control, calculated as of the date of the amendment, suspension or termination. Any termination of the Plan shall be made in accordance with the requirements of Section 409A of the Code, if applicable.

		
	9.
	IRC SECTION 409A.

(A)It is anticipated that payments under this Plan (except for certain Unit payments after a Change of Control) shall not be subject to Section 409A of the Code as a result of the "short-term deferral" exception set forth in applicable guidance. However, if and to the extent that section 409A of the Code applies to amounts payable under the Plan, distributions may only be made under the Plan upon an event and in a manner permitted by Code Section 409A. To the extent that any provision of the Plan would cause a conflict with any applicable requirements of Code Section 409A, or would cause the administration of the Plan to fail to satisfy the applicable requirements of Section 409A, such provision shall be deemed null and void. 

(B)Notwithstanding anything in the Plan to the contrary, if Section 409A of the Code applies to the Plan and if a participant is a "specified employee," as defined in Code Section 409A, payment of benefits under this Plan upon termination of employment shall be postponed for six months after termination of employment if required in order to avoid adverse taxation under Code Section 409A. If payment of benefits under the Plan is required to be postponed pursuant to Section 409A, the accumulated amounts withheld on account of Section 409A shall be paid in a lump sum payment within fifteen days after the end of the required postponement period along with interest at the Applicable Federal Rate short-term rate on the unpaid balance for the postponement period. If the participant dies during such postponement period prior to the payment of benefits, the amounts withheld on account of Section 409A shall be paid to the participant's beneficiary determined under Section 6.

		
	10.
	WITHHOLDING

(A)All payments under the Plan shall be subject to applicable tax withholding under various taxing jurisdictions as well as various liens that are legally placed on such payments as determined by the Company.

5

		
	11.
	CONTROLLING LAW

(A)The Plan shall be construed and enforced according to the laws of the state of Connecticut, exclusive of conflict of law provisions thereof, to the extent not preempted by Federal law, which shall otherwise control.

		
	12.
	OTHER PLANS; NO RIGHTS

(A)Nothing in the Plan shall prevent a participant from being included in any other employee benefit or stock option or purchase plan of the Company or its subsidiaries or affiliates, or from receiving any compensation provided by them. Neither the Plan nor any action taken thereunder shall be understood as giving any person any right to be retained in the employ of the Company or any subsidiary or affiliate, nor shall any person (including persons participating for a prior year) be entitled as of right to be selected as a participant in the Plan for any year.

		
	13.
	EFFECTIVE DATE

The Plan, as amended and restated herein, shall become effective on February 4, 2019.

6

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