exv4w5







 




    Exhibit
    4.5



 




    FREDDIE
    MAC



 


 




    CERTIFICATE
    OF CREATION, DESIGNATION, POWERS,

    PREFERENCES, RIGHTS, PRIVILEGES, QUALIFICATIONS,

    LIMITATIONS, RESTRICTIONS, TERMS AND CONDITIONS

    of

    5.1% NON-CUMULATIVE PREFERRED STOCK

    (Par Value $1.00 Per Share)



 



    I, MAUD MATER, Secretary of the Federal Home Loan Mortgage
    Corporation, a government-sponsored enterprise of the United
    States of America (“Freddie Mac” or the
    “Corporation”), do hereby certify that, pursuant to
    authority vested in the Board of Directors of Freddie Mac by
    Section 306(f)
    of the Federal Home Loan Mortgage Corporation Act, as amended
    (12 U.S.C.
    §1455(f)),
    the Board of Directors adopted FHLMC
    Resolution 98-05
    on March 6, 1998 and adopted FHLMC
    Resolution 98-32
    on September 11, 1998, which resolutions are now, and at
    all times since such date have been, in full force and effect,
    and that the Chairman and Chief Executive Officer, pursuant to
    the authority delegated to him by such resolutions, approved the
    final terms of the public issuance and sale of the preferred
    stock of Freddie Mac designated above.



 



    The 5.1% Non-Cumulative Preferred Stock shall have the following
    designation, powers, preferences, rights, privileges,
    qualifications, limitations, restrictions, terms and conditions:



 




    1. Designation,
    Par Value, Number of Shares and Seniority



 



    The class of preferred stock of Freddie Mac created hereby (the
    “Non-Cumulative
    Preferred Stock”) shall be designated “5.1%
    Non-Cumulative
    Preferred Stock,” shall have a par value of $1.00 per share
    and shall consist of 8 million shares.* The Board of
    Directors shall be permitted to increase the authorized number
    of such shares at any time. The
    Non-Cumulative
    Preferred Stock shall rank prior to the Voting Common Stock of
    Freddie Mac (the “Common Stock”) to the extent
    provided in this Certificate and shall rank, both as to
    dividends and upon liquidation, on a parity with the Variable
    Rate, Non-Cumulative Preferred Stock issued on
    September 23, 1998, the 5% Non-Cumulative Preferred Stock
    issued on March 23, 1998, the 5.81% Non-Cumulative
    Preferred Stock issued on October 27, 1997, the 6.14%
    Non-Cumulative Preferred Stock issued on June 3, 1997, the
    6.125% Non-Cumulative Preferred Stock issued on November 1,
    1996, the Variable Rate, Non-Cumulative Preferred Stock issued
    on April 26, 1996 and the 6.72% Non-Cumulative Preferred
    Stock issued on August 2, 1993 (collectively, the
    “Existing Preferred Stock”).



 




    2. Dividends



 



    (a) The holders of outstanding shares of Non-Cumulative
    Preferred Stock shall be entitled to receive, ratably, when, as
    and if declared by the Board of Directors, in its sole
    discretion, out of funds legally available therefor,
    non-cumulative, cash dividends at the annual rate of 5.1%, or
    $2.55, per share of Non-Cumulative Preferred Stock. Dividends on
    the Non-Cumulative Preferred Stock shall accrue from but not
    including September 23, 1998 and are payable when, as and
    if declared by the Board of Directors quarterly on
    March 31, June 30, September 30 and
    December 31 of each year (each, a “Dividend Payment
    Date”) commencing on December 31, 1998. If a Dividend
    Payment Date is not a “Business Day,” the related
    dividend shall be paid on the next Business Day with the same
    force and effect as though paid on the Dividend Payment Date,
    without any increase to account for the period from such
    Dividend Payment Date through the date of actual payment. For
    these purposes, “Business Day” means a day other than
    (i) a Saturday or Sunday, (ii) a day on which New York
    City banks are closed or (iii) a day on which the offices
    of Freddie Mac are closed. The “Dividend Period”
    relating to a Dividend Payment Date shall be the period from but
    not including the preceding Dividend Payment Date (or from but
    not including September 23, 1998, in the case of the first







    * Plus up to 1,200,000
    additional shares pursuant to Underwriters’ overallotment
    option.
    













 






    Dividend Payment Date) through and including the related
    Dividend Payment Date. The dividend payable in respect of the
    first Dividend Period will be $0.68708 per share. The amount of
    dividends payable in respect of any quarterly Dividend Period
    other than the first Dividend Period shall be computed at a rate
    equal to 5.1% divided by 4; the amount of dividends payable in
    respect of any shorter period shall be computed on the basis of
    twelve 30-day months and a 360-day year. Each such dividend
    shall be paid to the holders of record of outstanding shares of
    the
    Non-Cumulative
    Preferred Stock as they appear in the books and records of
    Freddie Mac on such record date as shall be fixed in advance by
    the Board of Directors, not to be earlier than 45 days nor
    later than 10 days preceding the applicable Dividend
    Payment Date. No dividends shall be declared or paid or set
    apart for payment on the Common Stock or any other class or
    series of stock ranking junior to or (except as hereinafter
    provided) on a parity with the
    Non-Cumulative
    Preferred Stock with respect to the payment of dividends unless
    dividends have been declared and paid or set apart (or ordered
    by the Board of Directors to be set apart) for payment on the
    outstanding
    Non-Cumulative
    Preferred Stock in respect of the then-current Dividend Period;
    provided, however, that the foregoing dividend preference shall
    not be cumulative and shall not in any way create any claim or
    right in favor of the holders of
    Non-Cumulative
    Preferred Stock in the event that Freddie Mac shall not have
    declared or paid or set apart (or the Board of Directors shall
    not have ordered to be set apart) dividends on the
    Non-Cumulative Preferred Stock in respect of any prior Dividend
    Period. In the event that Freddie Mac shall not pay any one or
    more dividends or any part thereof on the
    Non-Cumulative
    Preferred Stock, the holders of the
    Non-Cumulative
    Preferred Stock shall not have any claim in respect of such
    non-payment
    so long as no dividend is paid on any junior or parity stock in
    violation of the next preceding sentence.



 



    (b) If, prior to September 23, 2000, one or more
    amendments to the Internal Revenue Code of 1986, as amended (the
    “Code”), are enacted that reduce the percentage of the
    dividends-received deduction as specified in
    section 243(a)(1) of the Code or any successor provision
    (the “Dividends-Received Percentage”), certain
    adjustments may be made in respect of the dividends payable by
    the Corporation, and Post Declaration Date Dividends and
    Retroactive Dividends (as such terms are defined below) may
    become payable, as described below.



 



    The amount of each dividend payable (if declared) per share of
    Non-Cumulative Preferred Stock for dividend payments made on or
    after the effective date of such change in the Code will be
    adjusted by multiplying the amount of the dividend payable
    pursuant to clause (a) of this Section 2 (before
    adjustment) by a factor, which shall be the number determined in
    accordance with the following formula (the “DRD
    Formula”), and rounding the result to the nearest cent
    (with one-half cent rounded up):



 



    1 - .35 (1 - .70)






    1 - .35 (1 - DRP)



 



    For the purposes of the DRD Formula, “DRP” means the
    Dividends-Received Percentage (expressed as a decimal)
    applicable to the dividend in question; provided,
    however, that if the Dividends-Received Percentage
    applicable to the dividend in question is less than 50%, then
    the DRP will equal .50. No amendment to the Code, other than a
    change in the percentage of the dividends-received deduction set
    forth in
    section 243(a)(1)
    of the Code or any successor provision, or a change in the
    percentage of the dividends-received deduction for certain
    categories of stock, which change is applicable to the Preferred
    Stock, will give rise to an adjustment.



 



    Notwithstanding the foregoing provisions, if, with respect to
    any such amendment, the Corporation receives either an
    unqualified opinion of nationally recognized independent tax
    counsel selected by the Corporation or a private letter ruling
    or similar form of assurance from the Internal Revenue Service
    (the “IRS”) to the effect that such an amendment does
    not apply to a dividend payable on the Non-Cumulative Preferred
    Stock, then such amendment shall not result in the adjustment
    provided for pursuant to the DRD Formula with respect to such
    dividend. The opinion referenced in the previous sentence shall
    be based upon the legislation amending or establishing the DRP
    or upon a published pronouncement of the IRS addressing such
    legislation. Unless the context otherwise requires, references
    to dividends herein shall mean dividends as adjusted by the DRD
    Formula. The Corporation’s calculation of the dividends
    payable as so adjusted shall be final and not subject to review.













 






    Notwithstanding the foregoing, if any such amendment to the Code
    is enacted after the dividend payable on a Dividend Payment Date
    has been declared but before such dividend is paid, the amount
    of the dividend payable on such Dividend Payment Date shall not
    be increased. Instead, additional dividends (the “Post
    Declaration Date Dividends”), equal to the excess, if any,
    of (x) the product of the dividend paid by the Corporation
    on such Dividend Payment Date and the DRD Formula (where the DRP
    used in the DRD Formula would be equal to the greater of the
    Dividends-Received Percentage applicable to the dividend in
    question and .50) over (y) the dividend paid by the
    Corporation on such Dividend Payment Date, shall be payable (if
    declared) to holders of Non-Cumulative Preferred Stock on the
    record date applicable to the next succeeding Dividend Payment
    Date, in addition to any other amounts payable on such date.



 



    If any such amendment to the Code is enacted and the reduction
    in the Dividends-Received Percentage retroactively applies to a
    Dividend Payment Date as to which the Corporation previously
    paid dividends on the Non-Cumulative Preferred Stock (each, an
    “Affected Dividend Payment Date”), the Corporation
    shall pay (if declared) additional dividends (the
    “Retroactive Dividends”) to holders on the record date
    applicable to the next succeeding Dividend Payment Date (or, if
    such amendment is enacted after the dividend payable on such
    Dividend Payment Date has been declared, to holders on the
    record date applicable to the second succeeding Dividend Payment
    Date following the date of enactment) in an amount equal to the
    excess of (x) the product of the dividend paid by the
    Corporation on each Affected Dividend Payment Date and the DRD
    Formula (where the DRP used in the DRD Formula would be equal to
    the greater of the Dividends-Received Percentage and .50 applied
    to each Affected Dividend Payment Date) over (y) the sum of
    the dividend paid by the Corporation on each Affected Dividend
    Payment Date. The Corporation will make only one payment of
    Retroactive Dividends for any such amendment. Notwithstanding
    the foregoing provisions, if, with respect to any such
    amendment, the Corporation receives either an unqualified
    opinion of nationally recognized independent tax counsel
    selected by the Corporation or a private letter ruling or
    similar form of assurance from the IRS to the effect that such
    amendment does not apply to a dividend payable on an Affected
    Dividend Payment Date for the Non-Cumulative Preferred Stock,
    then such amendment will not result in the payment of
    Retroactive Dividends with respect to such Affected Dividend
    Payment Date. The opinion referenced in the previous sentence
    must be based upon the legislation amending or establishing the
    DRP or upon a published pronouncement of the IRS addressing such
    legislation.



 



    In the event that the amount of dividends payable per share of
    the Non-Cumulative Preferred Stock is adjusted pursuant to the
    DRD Formula and/or Post Declaration Date Dividends or
    Retroactive Dividends are to be paid, the Corporation will give
    notice of each such adjustment and, if applicable, any Post
    Declaration Date Dividends and Retroactive Dividends to be given
    as soon as practicable to the holders of Non-Cumulative
    Preferred Stock.



 



    (c) Notwithstanding any other provision of this
    Certificate, the Board of Directors, in its discretion, may
    choose to pay dividends on the
    Non-Cumulative
    Preferred Stock without the payment of any dividends on the
    Common Stock or any other class or series of stock from time to
    time outstanding ranking junior to the
    Non-Cumulative
    Preferred Stock with respect to the payment of dividends.



 



    (d) No dividend shall be declared or paid or set apart for
    payment on any shares of the
    Non-Cumulative
    Preferred Stock if at the same time any arrears or default
    exists in the payment of dividends on any outstanding class or
    series of stock of Freddie Mac ranking prior to or (except as
    provided herein) on a parity with the
    Non-Cumulative
    Preferred Stock with respect to the payment of dividends. If and
    whenever dividends, having been declared, shall not have been
    paid in full, as aforesaid, on shares of the
    Non-Cumulative
    Preferred Stock and on the shares of any other class or series
    of stock of Freddie Mac ranking on a parity with the
    Non-Cumulative
    Preferred Stock with respect to the payment of dividends, all
    such dividends that have been declared on shares of the
    Non-Cumulative
    Preferred Stock and on the shares of any such other class or
    series shall be paid pro rata, so that the respective amounts of
    dividends paid per share on the
    Non-Cumulative
    Preferred Stock and on such other class or series shall in all
    cases bear to each other the same ratio that the respective
    amounts of dividends declared but unpaid per share on the shares
    of the
    Non-Cumulative
    Preferred Stock (including any adjustments due to changes in the
    Dividends-Received
    Percentage) and on the shares of such other class or series bear
    to each other.













 






    (e) Holders of shares of the Non-Cumulative Preferred Stock
    shall not be entitled to any dividends, in cash or in property,
    other than as herein provided and shall not be entitled to
    interest, or any sum in lieu of interest, on or in respect of
    any dividend payment.



 




    3. Optional
    Redemption



 



    (a) The Non-Cumulative Preferred Stock shall not be
    redeemable prior to September 30, 2003. Subject to this
    limitation and to any further limitations which may be imposed
    by law, Freddie Mac may redeem the
    Non-Cumulative
    Preferred Stock, in whole or in part, at any time or from time
    to time, out of funds legally available therefor, at the
    redemption price of $50.00 per share plus an amount, determined
    in accordance with Section 2 above, equal to the amount of
    the dividend, if any, otherwise payable for the then-current
    Dividend Period accrued through and including the date of such
    redemption. If less than all of the outstanding shares of the
    Non-Cumulative
    Preferred Stock are to be redeemed, Freddie Mac shall select
    shares to be redeemed from the outstanding shares not previously
    called for redemption by lot or pro rata (as nearly as possible)
    or by any other method which Freddie Mac in its sole discretion
    deems equitable.



 



    (b) In the event Freddie Mac shall redeem any or all of the
    Non-Cumulative Preferred Stock as aforesaid, notice of such
    redemption shall be given by Freddie Mac by first class mail,
    postage prepaid, mailed neither less than 30 nor more than
    60 days prior to the redemption date, to each holder of
    record of the shares of the
    Non-Cumulative
    Preferred Stock being redeemed, at such holder’s address as
    the same appears in the books and records of Freddie Mac. Each
    such notice shall state the number of shares being redeemed, the
    redemption price, the redemption date and the place at which
    such holder’s certificate(s) representing shares of the
    Non-Cumulative
    Preferred Stock must be presented for cancellation or exchanges,
    as the case may be, upon such redemption. Failure to give
    notice, or any defect in the notice, to any holder of the
    Non-Cumulative Preferred Stock shall not affect the validity of
    the proceedings for the redemption of shares of any other holder
    of
    Non-Cumulative
    Preferred Stock being redeemed.



 



    (c) Notice having been mailed as aforesaid, from and after
    the redemption date specified therein and upon payment of the
    consideration set forth in Section 3(a) above, said shares
    of the
    Non-Cumulative
    Preferred Stock shall no longer be deemed to be outstanding, and
    all rights of the holders thereof as holders of the
    Non-Cumulative
    Preferred Stock shall cease, with respect to shares so redeemed.



 



    (d) Any shares of the Non-Cumulative Preferred Stock which
    shall have been redeemed shall, after such redemption, no longer
    have the status of authorized, issued or outstanding shares.



 




    4. No
    Voting Rights



 



    Except as set forth in Section 9(h) below, the shares of
    the
    Non-Cumulative
    Preferred Stock shall not have any voting powers, either general
    or special.



 




    5. No
    Conversion or Exchange Rights



 



    The holders of shares of the
    Non-Cumulative
    Preferred Stock shall not have any right to convert such shares
    into or exchange such shares for any other class or series of
    stock or obligations of Freddie Mac.



 




    6. No
    Preemptive Rights



 



    No holder of the
    Non-Cumulative
    Preferred Stock shall as such holder have any preemptive right
    to purchase or subscribe for any other shares, rights, options
    or other securities of any class of Freddie Mac which at any
    time may be sold or offered for sale by Freddie Mac.



 




    7. Liquidation
    Rights and Preference



 



    (a) Except as otherwise set forth herein, upon the
    voluntary or involuntary dissolution, liquidation or winding up
    of Freddie Mac, after payment of or provision for the
    liabilities of Freddie Mac and the expenses of such dissolution,
    liquidation or winding up, the holders of the outstanding shares
    of the
    Non-Cumulative
    Preferred Stock shall be entitled to receive out of the assets
    of Freddie Mac available for distribution to stockholders,
    before any payment or distribution shall be made on the Common
    Stock or any other class or













 






    series of stock of Freddie Mac ranking junior to the
    Non-Cumulative
    Preferred Stock upon liquidation, the amount of $50.00 per share
    plus an amount, determined in accordance with Section 2
    above, equal to the dividend, if any, otherwise payable for the
    then-current
    Dividend Period accrued through and including the date of
    payment in respect of such dissolution, liquidation or winding
    up, and the holders of the outstanding shares of any class or
    series of stock of Freddie Mac ranking on a parity with the
    Non-Cumulative
    Preferred Stock upon liquidation shall be entitled to receive
    out of the assets of Freddie Mac available for distribution to
    stockholders, before any such payment or distribution shall be
    made on the Common Stock or any other class or series of stock
    of Freddie Mac ranking junior to the
    Non-Cumulative
    Preferred Stock and to such parity stock upon liquidation, any
    corresponding preferential amount to which the holders of such
    parity stock may, by the terms thereof, be entitled; provided,
    however, that if the assets of Freddie Mac available for
    distribution to stockholders shall be insufficient for the
    payment of the full amounts to which the holders of the
    outstanding shares of the
    Non-Cumulative
    Preferred Stock and the holders of the outstanding shares of
    such parity stock shall be entitled to receive upon such
    dissolution, liquidation or winding up of Freddie Mac as
    aforesaid, then, subject to paragraph (b) of this
    Section 7, all of the assets of Freddie Mac available for
    distribution to stockholders shall be distributed to the holders
    of outstanding shares of the
    Non-Cumulative
    Preferred Stock and to the holders of outstanding shares of such
    parity stock pro rata, so that the amounts so distributed to
    holders of the
    Non-Cumulative
    Preferred Stock and to holders of such classes or series of such
    parity stock, respectively, shall bear to each other the same
    ratio that the respective distributive amounts to which they are
    so entitled (including any adjustment due to changes in the
    Dividends-Received Percentage) bear to each other. After the
    payment of the aforesaid amounts to which they are entitled, the
    holders of outstanding shares of the
    Non-Cumulative
    Preferred Stock and the holders of outstanding shares of any
    such parity stock shall not be entitled to any further
    participation in any distribution of assets of Freddie Mac.



 



    (b) Notwithstanding the foregoing, upon the dissolution,
    liquidation or winding up of Freddie Mac, the holders of shares
    of the
    Non-Cumulative
    Preferred Stock then outstanding shall not be entitled to be
    paid any amounts to which such holders are entitled pursuant to
    paragraph (a) of this Section 7 unless and until the
    holders of any classes or series of stock of Freddie Mac ranking
    prior upon liquidation to the Non-Cumulative Preferred Stock
    shall have been paid all amounts to which such classes or series
    are entitled pursuant to their respective terms.



 



    (c) Neither the sale of all or substantially all of the
    property or business of Freddie Mac, nor the merger,
    consolidation or combination of Freddie Mac into or with any
    other corporation or entity, shall be deemed to be a
    dissolution, liquidation or winding up for the purpose of this
    Section 7.



 




    8. Additional
    Classes or Series of Stock



 



    The Board of Directors shall have the right at any time in the
    future to authorize, create and issue, by Resolution or
    resolutions, one or more additional classes or series of stock
    of Freddie Mac, and to determine and fix the distinguishing
    characteristics and the relative rights, preferences, privileges
    and other terms of the shares thereof. Any such class or series
    of stock may rank prior to or on a parity with or junior to the
    Non-Cumulative Preferred Stock as to dividends or upon
    liquidation or otherwise.



 




    9. Miscellaneous



 



    (a) Any stock of any class or series of Freddie Mac shall
    be deemed to rank:



 



    (i) prior to the shares of the
    Non-Cumulative
    Preferred Stock, either as to dividends or upon liquidation, if
    the holders of such class or series shall be entitled to the
    receipt of dividends or of amounts distributable upon
    dissolution, liquidation or winding up of Freddie Mac, as the
    case may be, in preference or priority to the holders of shares
    of the
    Non-Cumulative
    Preferred Stock;



 



    (ii) on a parity with shares of the Non-Cumulative
    Preferred Stock, either as to dividends or upon liquidation,
    whether or not the dividend rates or amounts, dividend payment
    dates or redemption of liquidation prices per share, if any, be
    different from those of the
    Non-Cumulative
    Preferred Stock, if the holders of such class or series shall be
    entitled to the receipt of dividends or of amounts distributable
    upon dissolution, liquidation or winding up of Freddie Mac, as
    the case may be, in proportion to their respective dividend
    rates or amounts or liquidation prices, without preference or
    priority, one over the other, as













 






    between the holders of such class or series and the holders of
    shares of the
    Non-Cumulative
    Preferred Stock; and



 



    (iii) junior to shares of the
    Non-Cumulative
    Preferred Stock, either as to dividends or upon liquidation, if
    such class or series shall be Common Stock, or if the holders of
    shares of the
    Non-Cumulative
    Preferred Stock shall be entitled to receipt of dividends or of
    amounts distributable upon dissolution, liquidation or winding
    up of Freddie Mac, as the case may be, in preference or priority
    to the holders of shares of such class or series.



 



    (b) Freddie Mac and any agent of Freddie Mac may deem and
    treat the holder of a share or shares of
    Non-Cumulative
    Preferred Stock, as shown in Freddie Mac’s books and
    records, as the absolute owner of such share or shares of
    Non-Cumulative
    Preferred Stock for the purpose of receiving payment of
    dividends in respect of such share or shares of
    Non-Cumulative
    Preferred Stock and for all other purposes whatsoever, and
    neither Freddie Mac nor any agent of Freddie Mac shall be
    affected by any notice to the contrary. All payments made to or
    upon the order of any such person shall be valid and, to the
    extent of the sum or sums so paid, effectual to satisfy and
    discharge liabilities for moneys payable by Freddie Mac on or
    with respect to any such share or shares of
    Non-Cumulative
    Preferred Stock.



 



    (c) The shares of the
    Non-Cumulative
    Preferred Stock, when duly issued, shall be fully paid and
    non-assessable.



 



    (d) The
    Non-Cumulative
    Preferred Stock shall be issued, and shall be transferable on
    the books of Freddie Mac, only in whole shares, it being
    intended that no fractional interests in shares of
    Non-Cumulative
    Preferred Stock shall be created or recognized by Freddie Mac.



 



    (e) For purposes of this Certificate, the term
    “Freddie Mac” means the Federal Home Loan Mortgage
    Corporation and any successor thereto by operation of law or by
    reason of a merger, consolidation or combination.



 



    (f) This Certificate and the respective rights and
    obligations of Freddie Mac and the holders of the
    Non-Cumulative
    Preferred Stock with respect to such
    Non-Cumulative
    Preferred Stock shall be construed in accordance with and
    governed by the laws of the United States, provided that the law
    of the Commonwealth of Virginia shall serve as the federal rule
    of decision in all instances except where such law is
    inconsistent with Freddie Mac’s enabling legislation, its
    public purposes or any provision of this Certificate.



 



    (g) Any notice, demand or other communication which by any
    provision of this Certificate is required or permitted to be
    given or served to or upon Freddie Mac shall be given or served
    in writing addressed (unless and until another address shall be
    published by Freddie Mac) to Freddie Mac, 8200 Jones Branch
    Drive, McLean, Virginia 22102, Attn: Executive Vice
    President-General
    Counsel and Secretary. Such notice, demand or other
    communication to or upon Freddie Mac shall be deemed to have
    been sufficiently given or made only upon actual receipt of a
    writing by Freddie Mac. Any notice, demand or other
    communication which by any provision of this Certificate is
    required or permitted to be given or served by Freddie Mac
    hereunder may be given or served by being deposited first class,
    postage prepaid, in the United States mail addressed (i) to
    the holder as such holder’s name and address may appear at
    such time in the books and records of Freddie Mac or
    (ii) if to a person or entity other than a holder of record
    of the Non-Cumulative Preferred Stock, to such person or entity
    at such address as appears to Freddie Mac to be appropriate at
    such time. Such notice, demand or other communication shall be
    deemed to have been sufficiently given or made, for all
    purposes, upon mailing.



 



    (h) Freddie Mac, by or under the authority of the Board of
    Directors, may amend, alter, supplement or repeal any provision
    of this Certificate pursuant to the following terms and
    conditions:



 



    (i) Without the consent of the holders of the
    Non-Cumulative Preferred Stock, Freddie Mac may amend, alter,
    supplement or repeal any provision of this Certificate to cure
    any ambiguity, to correct or supplement any provision herein
    which may be defective or inconsistent with any other provision
    herein, or to make any other provisions with respect to matters
    or questions arising under this Certificate, provided that such
    action shall not materially and adversely affect the interests
    of the holders of the Non-Cumulative Preferred Stock.













 






    (ii) The consent of the holders of at least 66 2/3% of
    all of the shares of the Non-Cumulative Preferred Stock at the
    time outstanding, given in person or by proxy, either in writing
    or by a vote at a meeting called for the purpose at which the
    holders of shares of the
    Non-Cumulative
    Preferred Stock shall vote together as a class, shall be
    necessary for authorizing, effecting or validating the
    amendment, alteration, supplementation or repeal of the
    provisions of this Certificate if such amendment, alteration,
    supplementation or repeal would materially and adversely affect
    the powers, preferences, rights, privileges, qualifications,
    limitations, restrictions, terms or conditions of the
    Non-Cumulative Preferred Stock. The creation and issuance of any
    other class or series of stock, or the issuance of additional
    shares of any existing class or series of stock of Freddie Mac
    (including the
    Non-Cumulative
    Preferred Stock), whether ranking prior to, on a parity with or
    junior to the Non-Cumulative Preferred Stock, shall not be
    deemed to constitute such an amendment, alteration,
    supplementation or repeal.



 



    (iii) Holders of the Non-Cumulative Preferred Stock shall
    be entitled to one vote per share on matters on which their
    consent is required pursuant to subparagraph (ii) of this
    paragraph (h). In connection with any meeting of such
    holders, the Board of Directors shall fix a record date, neither
    earlier than 60 days nor later than 10 days prior to
    the date of such meeting, and holders of record of shares of the
    Non-Cumulative
    Preferred Stock on such record date shall be entitled to notice
    of and to vote at any such meeting and any adjournment. The
    Board of Directors, or such person or persons as it may
    designate, may establish reasonable rules and procedures as to
    the solicitation of the consent of holders of the
    Non-Cumulative
    Preferred Stock at any such meeting or otherwise, which rules
    and procedures shall conform to the requirements of any national
    securities exchange on which the
    Non-Cumulative
    Preferred Stock may be listed at such time.



 



    (i) RECEIPT AND ACCEPTANCE OF A SHARE OR SHARES OF THE
    NON-CUMULATIVE PREFERRED STOCK BY OR ON BEHALF OF A HOLDER SHALL
    CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER (AND ALL
    OTHERS HAVING BENEFICIAL OWNERSHIP OF SUCH SHARE OR SHARES) OF
    ALL OF THE TERMS AND PROVISIONS OF THIS CERTIFICATE. NO
    SIGNATURE OR OTHER FURTHER MANIFESTATION OF ASSENT TO THE TERMS
    AND PROVISIONS OF THIS CERTIFICATE SHALL BE NECESSARY FOR ITS
    OPERATION OR EFFECT AS BETWEEN FREDDIE MAC AND THE HOLDER (AND
    ALL SUCH OTHERS).



 



    IN WITNESS WHEREOF, I have hereunto set my hand and the seal of
    Freddie Mac this 23rd day of September, 1998.



 


 




    [Seal]
    




    /s/  Maud
    Mater








    Maud Mater, Secretary