1. ® Intelligent Mail Update

2. ® 2 Agenda  Program Update  Move Update  Requirements Reminders  Issues  Release 3 (what’s coming)  Full Service Verification Update  Business Mail Entry Update

3. ® 3  Program Highlights ●$1.4 Billion in revenue for Full Service ●5 Billion Full Service pieces processed  January Price Change (1/4/10) ●Successfully implemented January Price Change  Release 3 (3/14/10) ●Testing in Progress  Release 4 (TBD) ●SOX Lockdown [April 1, 2010 to September 30, 2010] ●Minimal Changes if any after Release 3 until January 2011 Program Update

4. ® 4 On-Boarding Trend

5. ® 5

6. ® Full Service Postage Statements Full Service Customer Sites Approved For Production 298 Full Service Postage Statements Finalized 51,027 Total Piece Volume for Full-Service 5,048,442,821 6

7. ® Full Service Postage Statements 7

8. ® 8

9. ® Move Update

10. ® Move Update Looking Good 10

11. ® Move Update Looking Good 11

12. ® Move Update Compliance and USPIS Investigations  Two separate and distinct issues  Move Update Compliance applies to individual mailings ●Verification /Acceptance based upon Performance Based Verification (PBV) ●MERLIN captures image; data analysis at AMS Memphis  USPIS Investigations focus on systemic issues ●Basis of investigation from a variety of sources ●Various sources of data to assist investigation 12

13. ® Requirements Reminder

14. ® Requirement Reminder  Barcode readability tolerance is 90% for POSTNET & Intelligent Mail® Barcodes on March 15, 2010  May 2011 – Only Intelligent Mail® Barcodes qualify for automation discounts

15. ® MERLIN Barcode Readability January 3, 2010 to Febuary 2, 2010 Barcode Type Mailings 90% and Over Percentage 90% and Over Mailings 80- 89% Percentage 80-89% Mailings Under 80% Percentage Of Mailings Under 80%Total Percentage Of Mailings POSTNET Letters1456494.27%2221.44%6644.30% 15,45067.75% IMb letters701495.38%1441.96%1962.67% 7,35432.25% TOTAL letters 21,57894.62% 3661.60% 8603.77% 22,804 POSTNET Flats131992.69%362.53%684.78% 1,42361.76% IMb Flats81792.74%404.54%242.72% 88138.24% TOTAL Flats 2,13692.71% 763.30% 923.99% 2,304

16. ® 16 Issues  CFS Software Update impact upon ACS Data ●Impacted ACS information delivery from Jan. 13 – Feb. 1 ●Mailers may have received Traditional ACS or Form 3579 ●Recovered data and adjusting billing accordingly  Issues List  Tray Barcode (Default) Placeholder  Large File Performance ●Performance Impacts for Large Files  Intelligent Mail Range (IMR) Records

17. ® 17 Performance Time01/25 - 01/31% Last Week% Cumulative Count of Job ID11,324100.00%N/A Sum of 00:00:00-00:04:5910,23990.42% Sum of 00:05:00-00:09:595324.70%95.12% Sum of 00:10:00-00:29:593903.44%98.56% Sum of 00:30:00-00:59:59860.76%99.32% Sum of 01:00:00-01:59:59420.37%99.69% Sum of 02:00:00-03:59:59170.15%99.84% Sum of 04:00:00-07:59:5940.04%99.88% Sum of 08:00:00-11:59:5980.07%99.95% Sum of 12:00:00-23:59:5960.05%100.00% Sum of 24:00:00+00.00%100.00%

18. ® 18 IMR Range Records  Large volume of single-piece or small range IMRs  Impacts Full Service validation processing  Impacts processing of Full Service ACS information  Interim solution – Provision Full Service data via NCSC ACS delivery processes  March Release Validation Removal  Formed subgroup under MTAC 122 to explore options

19. ® 19 Release 3  Statement of Ownership  BMC to NDC  Mail.dat ●New Mail.dat File Processing Client  Automatic update for batch users ●Mail.dat - Receipt Process ●Pending Periodicals weighing more than 16 ozs ●Full Service Bound Printed Matter ●Correct Mailing Agent Display ●Detached Address Labels ●Validations

20. ® 20 Release 3  Mail.XML ●Mail.XML 8.0B Changes ●New Mail.XML message support for MLOCR  Customer Mail Report  Summary ZIP Destination Report ●Update container information  Add, change, cancel container (logical or physical) data for Mail.XML or Mail.dat based eDoc ●Improved validation error reporting ●Ability for owners and preparers to get appointment closeout data ●FAST support for CRID based identification/authorization

21. ® 21 Full Service Verification Update  Feedback on Full Service Mailings via Microstrategy Reports  Key Compliance Issues: ●Barcode Uniqueness ●CSA Verification ●Mailer ID Accuracy ●Service Type Code Accuracy ●Appointment Accuracy ●Mail Owner/Mail Preparer Accuracy

22. ® 22 Full Service Verification Update  Provisioning Full Service Compliance Issue to Mailers – Microstrategy Reports ●Improved Performance on Reports (limiting detail data) ●Provisioning Detailed Data ●Review Reports with Mailers  Establish Compliance Quality Bar ●Analyze data for Threshold Determination ●Establish Non-Compliance Remediation  Update Verification Processes

23. ® 23 Business Mail Entry Compliance  Impacts all Areas of Mail Acceptance – BMEU, DMU, and Facility Induction  Strengthen Business Process Financial Controls  Validate Existing Business Processes  Communicate Process Compliance Standards  Monitor and Improve

24. ® 24 Business Mail Entry Compliance  Key Financial Controls ●Revenue Reporting Controls  Postage Statement Completeness  Drop Shipment Documentation Completeness ●Ensure Acceptance Process Compliance ●Ensure Mail Entry (Induction) Compliance  Origin Mail Induction  Destination Mail Induction (PVDS) ●Revenue Completeness - Is everything accounted for?

25. ® 25 Business Mail Entry Compliance  Controls Compliance ●Postage Statements  Mailer and USPS sections Completed and Accurate  Accounts Active and Funded  Statements Processed Timely  Adjustments Processed Timely and Accurate ●Drop Shipment Documentation Completeness  Mailer and USPS sections Completed Accurately ●Verifications Conducted as Required

26. ® BMEU / AO Check In  Check Mailing into PostalOne! – Hardcopy or eDOC  Clerk clerk performs Initial (cursory) review of mailing  Determine what verifications are required Staging  If no space constraints: Arrival, Verification, Hold, Cleared  If space constraints: General, Cleared Verification  Perform in-depth verifications as required  Perform additional verifications per SOP  Record results and finalize statement Cleared  Affix 3607  Move to Clearance Area Reconciliation  Assign individual and backup  Review dashboard for unfinished jobs, clear jobs. Record reasons for unfinished jobs  Sign and date Reconciliation Report Business Mail Entry Compliance 26

27. ® DMU Check In  Check Mailing into PostalOne! – Hardcopy or eDOC  Clerk clerk performs Initial (cursory) review of mailing  Determine what verifications are required Staging  Staged  Production  Inventory Verification  Perform in-depth verifications as required  Perform additional verifications per SOP  Record results and finalize statement Clear  Observe Truck/Release Mail  8125 Reconciliation  Assign individual and backup  Review dashboard for unfinished jobs, clear jobs. Record reasons for unfinished jobs  Sign and date Reconciliation Report Business Mail Entry Compliance 27

28. ® Streamlining Hard Copy Postage Statements  Starting March 15, 2010, the Postal Service will no longer fill out the USPS® section of a hard copy postage statement nor round-stamp the document  Mailers encouraged to go online to view their mailing activities and retrieve processed postage statements.  Upon request, a customer may obtain a hard copy receipt of the postage statement or Statement of Mailing/ Weighing and Dispatch Certificate, PS Form 3607, after acceptance and verification are completed.

29. ® Streamlining Hard Copy Postage Statements  Federal Register Proposal Closes Feb 25  13 comments received to date  Mailers and service providers ● It’s about time! ● Fabulous idea ● Our clients prefer the round stamp ● How do we access our client’s information?  Implementing March 15