EX-4.1






CERTIFICATE OF DESIGNATION OF TERMS OF




VARIABLE RATE NON-CUMULATIVE PREFERRED STOCK, SERIES P




1. Designation, Par Value and Number of Shares.



The designation of the series of preferred stock of the Federal National Mortgage Association
(“Fannie Mae”) created by this resolution shall be “Variable Rate Non-Cumulative Preferred Stock,
Series P” (the “Series P Preferred Stock”), and the number of shares initially constituting the
Series P Preferred Stock is 40,000,000. Shares of Series P Preferred Stock will have no par value
and a stated value of $25 per share. Shares of Series P Preferred Stock will have no stated
maturity date, and, subject to Section 3 below, will be perpetual. The Board of Directors of Fannie
Mae, or a duly authorized committee thereof, in its sole discretion, may reduce the number of
shares of Series P Preferred Stock, provided such reduction is not below the number of shares of
Series P Preferred Stock then outstanding.



2. Dividends.



(a) Holders of record of Series P Preferred Stock (each individually a “Holder”, or
collectively the “Holders”) will be entitled to receive, when, as and if declared by the Board of
Directors of Fannie Mae, or a duly authorized committee thereof, in its sole discretion out of
funds legally available therefor, non-cumulative quarterly dividends which will accrue from and
including the date of issuance and will be payable on March 31, June 30, September 30 and
December 31 of each year (each, a “Dividend Payment Date”), commencing December 31, 2007. If a
Dividend Payment Date is not a Business Day, the related dividend (if declared) will be paid on the
next succeeding 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. A “Business Day” shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in New York, New York are authorized or required by law to close.
Dividends will be paid to Holders on the record date fixed by the Board of Directors or a duly
authorized committee thereof, which will be no earlier than 45 days or later than 10 days prior to
the applicable Dividend Payment Date.



If declared, the initial dividend will be for the period from and including the date of
issuance to but excluding December 31, 2007. Thereafter, if declared, quarterly dividends will
accrue at a per annum rate equal to the greater of (i) 4.50% and (ii) the sum of the 3-Month LIBOR
(as defined below) applicable to such quarterly period and 0.75%; the dividend rate will be rounded
to the fourth digit after the decimal point (if the fifth digit to the right of the decimal point
is five or greater, the fourth digit will be rounded up by one). On December 31, 2007 and each
March 31, June 30, September 30 and December 31 thereafter, the previous dividend rate will be
replaced with the dividend rate determined in accordance with the immediately preceding sentence.
In determining the dividend rate for any Dividend Period (as defined below), 3-Month LIBOR for such
Dividend Period will be calculated by Fannie Mae on the second London Business Day (defined as any
day on which commercial banks are open for business (including dealings in foreign exchange and
deposits in U.S. dollars) in London, England) immediately preceding the first day of such Dividend
Period (each a “LIBOR Determination Date”). The “Dividend Period” relating to a Dividend Payment
Date will be the period from and including the preceding Dividend Payment Date (or, in the case of
the initial dividend, September 28, 2007) to but excluding such Dividend Payment Date. If Fannie
Mae redeems the Series P Preferred Stock, the dividend that would otherwise be payable for the
then-current quarterly Dividend Period will be included in the redemption price of the shares
redeemed and will not be separately payable. Dividends payable on the Series P Preferred Stock for
any period will be computed on the basis of the actual number of days elapsed during such period
and a 360-day year.



“3-Month LIBOR” for any LIBOR Determination Date with respect to any Dividend Period will be
the rate equal to (in the following order of priority):




(1) the rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Reuters Screen LIBOR01 as of 11:00 a.m. (London time)
on the related LIBOR Determination Date. “Reuters Screen LIBOR01” means the display
designated as “Reuters Screen LIBOR01 Page” or such other page as may replace Reuters Screen
LIBOR01 Page on that service or such other service or services as may be nominated by the
British Bankers’ Association as the information vendor for the purpose of displaying London
interbank offered rates for U.S. dollar deposits. If at least two rates appear on the
Reuters Screen LIBOR01, the rate on the LIBOR Determination Date will be the arithmetic mean
of such rates;




(2) if the rate specified in (1) cannot be identified on the related LIBOR
Determination Date, then the Calculation Agent will request the principal London offices of
five leading banks (which may include affiliates of the Placement Agents) in the London
interbank market selected by the Calculation Agent (after consultation with Fannie Mae, if
Fannie Mae is not then acting as Calculation Agent) to provide those banks’ offered
quotations (expressed as percentages per annum) to prime banks in the London interbank
market for deposits in U.S. dollars having a three-month maturity as of 11:00 a.m. (London
time) on such LIBOR Determination Date. If at least two quotations are provided, then
3-Month LIBOR will be the arithmetic mean determined by the Calculation Agent of the
quotations obtained (and, if five quotations are provided, eliminating the highest quotation
(or in the event of equality, one of the highest) and the lowest quotation (or in the event
of equality, one of the lowest));




(3) if fewer than two quotations are provided as requested in clause (2) above, then
the Calculation Agent will request five major banks (which may include affiliates of the
Placement Agents) in New York, New York selected by the Calculation Agent (after
consultation with Fannie Mae, if Fannie Mae is not then acting as Calculation Agent) to
provide those banks’ offered quotations (expressed as percentages per annum) to leading
European banks for loans having a three-month maturity in U.S. dollars as of 11:00 a.m. (New
York City time) on such LIBOR Determination Date. If at least two quotations are provided,
then 3-Month LIBOR will be the arithmetic mean determined by the Calculation Agent of the
quotations obtained (and, if five quotations are provided, eliminating the highest quotation
(or in the event of equality, one of the highest) and the lowest quotation (or in the event
of equality, one of the lowest)); and




(4) if fewer than two quotations are so provided as requested in clause (3) above,
then 3-Month LIBOR as of such LIBOR Determination Date will be 3-Month LIBOR determined for
the immediately preceding Dividend Period. If the applicable Dividend Period is the first
Dividend Period, then 3-Month LIBOR will be the rate for deposits in U.S. dollars having a
three-month maturity that appeared, as of 11:00 a.m. (London time) on the most recent London
Business Day preceding the LIBOR Determination Date for which the rate was displayed on
Reuters Screen LIBOR01 with respect to deposits commencing on the second London Business Day
following that date.



The Calculation Agent’s determination of the 3-Month LIBOR and the dividend rate will be final
and binding absent manifest error.



(b) No dividend (other than dividends or distributions paid in shares of, or options, warrants
or rights to subscribe for or purchase shares of, the common stock of Fannie Mae or any other stock
of Fannie Mae ranking, as to the payment of dividends and the distribution of assets upon
dissolution, liquidation or winding up of Fannie Mae, junior to the Series P Preferred Stock) may
be declared or paid or set apart for payment on Fannie Mae’s common stock (or on any other stock of
Fannie Mae ranking, as to the payment of dividends, junior to the Series P Preferred Stock) unless
dividends have been declared and paid or set apart (or ordered to be set apart) on the Series P
Preferred Stock for the then-current quarterly 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 Series P Preferred Stock in the event that dividends have not been
declared or paid or set apart (or ordered to be set apart) on the Series P Preferred Stock in
respect of any prior Dividend Period. If the full dividend on the Series P Preferred Stock is not
paid for any quarterly Dividend Period (including a dividend that is not paid because regulatory
approval is not granted), the Holders of Series P Preferred Stock will have no claim in respect of
the unpaid amount so long as no dividend (other than those referred to above) is paid on Fannie
Mae’s common stock (or any other stock of Fannie Mae ranking, as to the payment of dividends,
junior to the Series P Preferred Stock) for such Dividend Period.



(c) The Board of Directors of Fannie Mae, or a duly authorized committee thereof, may, in its
discretion, choose to pay dividends on the Series P Preferred Stock without the payment of any
dividends on Fannie Mae’s common stock (or any other stock of Fannie Mae ranking, as to the payment
of dividends, junior to the Series P Preferred Stock).



(d) No full dividends shall be declared or paid or set apart for payment on any stock of
Fannie Mae ranking, as to the payment of dividends, on a parity with the Series P Preferred Stock
for any period unless full dividends have been declared and paid or set apart for payment on the
Series P Preferred Stock for the then-current quarterly Dividend Period. When dividends are not
paid in full upon the Series P Preferred Stock and all other classes or series of stock of Fannie
Mae, if any, ranking, as to the payment of dividends, on a parity with the Series P Preferred
Stock, all dividends declared upon shares of Series P Preferred Stock and all such other stock of
Fannie Mae will be declared pro rata so that the amount of dividends declared per share of Series P
Preferred Stock and all such other stock will in all cases bear to each other the same ratio that
accrued dividends per share of Series P Preferred Stock (but without, in the case of any
noncumulative preferred stock, accumulation of unpaid dividends for prior Dividend Periods) and
such other stock bear to each other.



(e) No dividends may be declared or paid or set apart for payment on any shares of Series P
Preferred Stock if at the same time any arrears exist or default exists in the payment of dividends
on any outstanding class or series of stock of Fannie Mae ranking, as to the payment of dividends,
prior to the Series P Preferred Stock.



(f) Holders of Series P Preferred Stock will not be entitled to any dividends, whether payable
in cash or property, other than as herein provided and will not be entitled to interest, or any sum
in lieu of interest, in respect of any dividend payment.



3. Optional Redemption.



(a) The Series P Preferred Stock shall not be redeemable prior to September 30, 2012. On and
after that date, subject to (x) the notice provisions set forth in Section 3(b) below, (y) the
receipt of any required regulatory approvals and (z) any further limitations which may be imposed
by law, Fannie Mae may redeem the Series P 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 $25 per
share plus an amount equal to the amount of the dividend (whether or not declared) for the
then-current quarterly Dividend Period accrued to but excluding the date of such redemption, but
without accumulation of unpaid dividends on the Series P Preferred Stock for prior Dividend
Periods. The amount of dividends per share payable at redemption will be rounded to the fourth
digit after the decimal point (if the fifth digit to the right of the decimal point is five or
greater, the fourth digit will be rounded up by one). If less than all of the outstanding shares
of Series P Preferred Stock are to be redeemed, Fannie Mae will select the 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 that the Board of Directors of Fannie Mae, or a duly authorized
committee thereof, in its sole discretion deems equitable.



(b) In the event Fannie Mae shall redeem any or all of the Series P Preferred Stock as
aforesaid, Fannie Mae will give written or electronic notice of any such redemption to Holders of
Series P Preferred Stock not less than 30 days prior to the date fixed by the Board of Directors of
Fannie Mae, or duly authorized committee thereof, for such redemption. Each such notice will state:
(1) the number of shares of Series P Preferred Stock to be redeemed and, if fewer than all of the
shares of Series P Preferred Stock held by a Holder are to be redeemed, the number of shares to be
redeemed from such Holder; (2) the redemption price; (3) the redemption date; and (4) the place at
which a Holder’s certificate(s) representing shares of Series P Preferred Stock must be presented
upon such redemption. Failure to give notice, or any defect in the notice, to any Holder of Series
P Preferred Stock shall not affect the validity of the proceedings for the redemption of shares of
any other Holder of Series P Preferred Stock being redeemed.



(c) Notice having been given as herein provided, from and after the redemption date, dividends
on the Series P Preferred Stock called for redemption shall cease to accrue and such Series P
Preferred Stock called for redemption will no longer be deemed outstanding, and all rights of the
Holders thereof as registered holders of such shares of Series P Preferred Stock will cease. Upon
surrender in accordance with said notice of the certificate(s) representing shares of Series P
Preferred Stock so redeemed (properly endorsed or assigned for transfer, if the Board of Directors
of Fannie Mae, or a duly authorized committee thereof, shall so require and the notice shall so
state), such shares shall be redeemed by Fannie Mae at the redemption price aforesaid. Any shares
of Series P Preferred Stock that shall at any time have been redeemed shall, after such redemption,
be cancelled and not reissued. In case fewer than all the shares represented by any such
certificate are redeemed, a new certificate shall be issued representing the unredeemed shares
without cost to the Holder thereof.



(d) The Series P Preferred Stock will not be subject to any mandatory redemption, sinking fund
or other similar provisions. In addition, Holders of Series P Preferred Stock will have no right to
require redemption of any shares of Series P Preferred Stock.



4. Liquidation Rights.



(a) Upon any voluntary or involuntary dissolution, liquidation or winding up of Fannie Mae,
after payment or provision for the liabilities of Fannie Mae and the expenses of such dissolution,
liquidation or winding up, the Holders of outstanding shares of the Series P Preferred Stock will
be entitled to receive out of the assets of Fannie Mae or proceeds thereof available for
distribution to stockholders, before any payment or distribution of assets is made to holders of
Fannie Mae’s common stock (or any other stock of Fannie Mae ranking, as to the distribution of
assets upon dissolution, liquidation or winding up of Fannie Mae, junior to the Series P Preferred
Stock), the amount of $25 per share plus an amount, determined in accordance with Section 2 above,
equal to the dividend (whether or not declared) for the then-current quarterly Dividend Period
accrued to but excluding the date of such liquidation payment, but without accumulation of unpaid
dividends on the Series P Preferred Stock for prior Dividend Periods.



(b) If the assets of Fannie Mae available for distribution in such event are insufficient to
pay in full the aggregate amount payable to Holders of Series P Preferred Stock and holders of all
other classes or series of stock of Fannie Mae, if any, ranking, as to the distribution of assets
upon dissolution, liquidation or winding up of Fannie Mae, on a parity with the Series P Preferred
Stock, the assets will be distributed to the Holders of Series P Preferred Stock and holders of all
such other stock pro rata, based on the full respective preferential amounts to which they are
entitled (but without, in the case of any noncumulative preferred stock, accumulation of unpaid
dividends for prior Dividend Periods).



(c) Notwithstanding the foregoing, Holders of Series P Preferred Stock will not be entitled to
be paid any amount in respect of a dissolution, liquidation or winding up of Fannie Mae until
holders of any classes or series of stock of Fannie Mae ranking, as to the distribution of assets
upon dissolution, liquidation or winding up of Fannie Mae, prior to the Series P Preferred Stock
have been paid all amounts to which such classes or series are entitled.



(d) Neither the sale, lease or exchange (for cash, shares of stock, securities or other
consideration) of all or substantially all of the property and assets of Fannie Mae, nor the
merger, consolidation or combination of Fannie Mae into or with any other entity or the merger,
consolidation or combination of any other entity into or with Fannie Mae, shall be deemed to be a
dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this Section
4.



(e) After payment of the full amount of the distribution of assets upon dissolution,
liquidation or winding up of Fannie Mae to which they are entitled pursuant to paragraphs (a), (b)
and (c) of this Section 4, the Holders of Series P Preferred Stock will not be entitled to any
further participation in any distribution of assets by Fannie Mae.



5. No Conversion or Exchange Rights.



The Holders of shares of Series P Preferred Stock will not have any rights to convert such
shares into or exchange such shares for shares of any other class or classes, or of any other
series of any class or classes, of stock or obligations of Fannie Mae.



6. No Pre-Emptive Rights.



No Holder of Series P Preferred Stock shall be entitled as a matter of right to subscribe for
or purchase, or have any pre-emptive right with respect to, any part of any new or additional issue
of stock of any class whatsoever, or of securities convertible into any stock of any class
whatsoever, or any other shares, rights, options or other securities of any class whatsoever,
whether now or hereafter authorized and whether issued for cash or other consideration or by way of
dividend.



7. Voting Rights; Amendments.



(a) Except as provided below, the Holders of Series P Preferred Stock will not be entitled to
any voting rights, either general or special.



(b) Without the consent of the Holders of Series P Preferred Stock, Fannie Mae will have the
right to amend, alter, supplement or repeal any terms of this Certificate or the Series P Preferred
Stock (1) to cure any ambiguity, or to cure, correct or supplement any provision contained in this
Certificate of Designation that may be defective or inconsistent with any other provision herein or
(2) to make any other provision with respect to matters or questions arising with respect to the
Series P Preferred Stock that is not inconsistent with the provisions of this Certificate of
Designation so long as such action does not materially and adversely affect the interests of the
Holders of Series P Preferred Stock; provided, however, that any increase in the amount of
authorized or issued Series P Preferred Stock or the creation and issuance, or an increase in the
authorized or issued amount, of any other class or series of stock of Fannie Mae, whether ranking
prior to, on a parity with or junior to the Series P Preferred Stock, as to the payment of
dividends or the distribution of assets upon dissolution, liquidation or winding up of Fannie Mae,
or otherwise, will not be deemed to materially and adversely affect the interests of the Holders of
Series P Preferred Stock.



(c) Except as set forth in paragraph (b) of this Section 7, the terms of this Certificate or
the Series P Preferred Stock may be amended, altered, supplemented, or repealed only with the
consent of the Holders of at least two-thirds of the shares of Series P Preferred Stock then
outstanding, given in person or by proxy, either in writing or at a meeting of stockholders at
which the Holders of Series P Preferred Stock shall vote separately as a class. On matters
requiring their consent, Holders of Series P Preferred Stock will be entitled to one vote per
share.



(d) The rules and procedures for calling and conducting any meeting of Holders (including,
without limitation, the fixing of a record date in connection therewith), the solicitation and use
of proxies at such a meeting, the obtaining of written consents, and any other aspect or matter
with regard to such a meeting or such consents shall be governed by any rules that the Board of
Directors of Fannie Mae, or a duly authorized committee thereof, in its discretion, may adopt from
time to time, which rules and procedures shall conform to the requirements of any national
securities exchange on which the Series P Preferred Stock are listed at the time (if so listed).



8. Additional Classes or Series of Stock.



The Board of Directors of Fannie Mae, or a duly authorized committee thereof, 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 Fannie Mae, 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, on a parity with or junior
to the Series P Preferred Stock as to the payment of dividends or the distribution of assets upon
dissolution, liquidation or winding up of Fannie Mae, or otherwise.



9. Priority.



For purposes of this Certificate of Designation, any stock of any class or series of Fannie
Mae shall be deemed to rank:



(a) Prior to the shares of Series P Preferred Stock, either as to the payment of dividends or
the distribution of assets upon dissolution, liquidation or winding up of Fannie Mae, 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 Fannie Mae, as the case may be, in
preference or priority to the Holders of shares of Series P Preferred Stock.



(b) On a parity with shares of Series P Preferred Stock, either as to the payment of dividends
or the distribution of assets upon dissolution, liquidation or winding up of Fannie Mae, whether or
not the dividend rates or amounts, dividend payment dates or redemption or liquidation prices per
share, if any, be different from those of the Series P 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 Fannie Mae, 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 Series
P Preferred Stock.



(c) Junior to shares of Series P Preferred Stock, either as to the payment of dividends or the
distribution of assets upon dissolution, liquidation or winding up of Fannie Mae, if such class
shall be common stock of Fannie Mae or if the Holders of shares of Series P Preferred Stock shall
be entitled to the receipt of dividends or of amounts distributable upon dissolution, liquidation
or winding up of Fannie Mae, as the case may be, in preference or priority over the holders of such
class or series.



(d) The shares of Preferred Stock of Fannie Mae designated “5.25% Non-Cumulative Preferred
Stock, Series D” (the “Series D Preferred Stock”), “5.10% Non-Cumulative Preferred Stock, Series E”
(the “Series E Preferred Stock”), “Variable Rate Non-Cumulative Preferred Stock, Series F” (the
“Series F Preferred Stock”), “Variable Rate Non-Cumulative Preferred Stock, Series G” (the “Series
G Preferred Stock”), “5.81% Non-Cumulative Preferred Stock, Series H” (the “Series H Preferred
Stock”) , “5.375% Non-Cumulative Preferred Stock, Series I” (the “Series I Preferred Stock”),
“5.125% Non-Cumulative Preferred Stock, Series L” (the “Series L Preferred Stock”), 4.75%
Non-Cumulative Preferred Stock, Series M (the “Series M Preferred Stock”), the 5.50% Non-Cumulative
Preferred Stock, Series N (the “Series N Preferred Stock”), the Non-Cumulative Preferred Stock,
Series O (the “Series O Preferred Stock”), and the “Non-Cumulative Convertible Series 2004-1
Preferred Stock” (the “Series 2004-1 Preferred Stock”) shall be deemed to rank on a parity with
shares of Series P Preferred Stock as to the payment of dividends and the distribution of assets
upon dissolution, liquidation or winding up of Fannie Mae. Accordingly, the holders of record of
Series D Preferred Stock, the holders of record of Series E Preferred Stock, the holders of record
of Series F Preferred Stock, the holders of record of Series G Preferred Stock, the holders of
record of Series H Preferred Stock, the holders of record of Series I Preferred Stock, the holders
of record of Series L Preferred Stock, the holders of record of Series M Preferred Stock, the
holders of record of Series N Preferred Stock, the holders of record of Series 2004-1 Preferred
Stock, the holders of record of Series O Preferred Stock and the Holders of the Series P Preferred
Stock shall be entitled to the receipt of dividends and of amounts distributable upon dissolution,
liquidation or winding up of Fannie Mae, 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.



10. Transfer Agent, Dividend Disbursing Agent and Registrar.



Fannie Mae hereby appoints Computershare Trust Company, N.A., as its initial transfer agent,
dividend disbursing agent and registrar for the Series P Preferred Stock. Fannie Mae may at any
time designate an additional or substitute transfer agent, dividend disbursing agent and registrar
for the Series P Preferred Stock.



11. Notices.



Any notice provided or permitted by this Certificate of Designation to be made upon, or given
or furnished to, the Holders of Series P Preferred Stock by Fannie Mae shall be made by first-class
mail, postage prepaid, to the addresses of such Holders as they appear on the books and records of
Fannie Mae or by other written or electronic means to designated accounts of such Holders. Such
notice shall be deemed to have been sufficiently made upon deposit thereof in the United States
mail or electronic transmission to a designated account of the Holder. Notwithstanding anything to
the contrary contained herein, in the case of the suspension of regular mail service or by reason
of any other cause it shall be impracticable, in Fannie Mae’s judgment, to give notice by mail, or
if Fannie Mae has reason to believe other notification means would be ineffective, then such
notification may be made, in Fannie Mae’s discretion, by publication in a newspaper of general
circulation in The City of New York or by hand delivery to the addresses of Holders as they appear
on the books and records of Fannie Mae.



Receipt and acceptance of a share or shares of the Series P Preferred Stock by or on
behalf of a Holder shall constitute the unconditional acceptance by such Holder (and all others
having beneficial ownership of such share or shares) of all of the terms and provisions of this
Certificate of Designation. No signature or other further manifestation of assent to the terms and
provisions of this Certificate of Designation shall be necessary for its operation or effect as
between Fannie Mae and the Holder (and all such others).