V
OÅering Circular dated April 2, 2004
Freddie Mac
Global Debt Facility
OÅered Securities:
Reference
SecuritiesSM:
Amount:
Maturities:
OÅering Terms:
Currencies:
Priority:
Tax Status:
Form of Securities:
Debt Securities.
We may designate some Debt Securities as Reference Notes» securities (""Reference
Notes''), which are regularly scheduled U.S. dollar or euro denominated issues in large
principal amounts.
Unlimited.
One day or longer.
We will oÅer the Debt Securities primarily through Dealers within the United States and
internationally on the terms described in this OÅering Circular and related Pricing
Supplements.
U.S. dollars, euros or other currencies speciÑed in the applicable Pricing Supplement.
The Debt Securities will be unsecured general obligations or unsecured subordinated
obligations of Freddie Mac.
The Debt Securities are not tax-exempt. Non-U.S. owners generally will be subject to
United States federal income and withholding tax unless they establish an exemption.
Non-U.S. dollar denominated Debt Securities: Registered (global or deÑnitive).
U.S. dollar denominated Debt Securities: Book-entry (U.S. Federal Reserve Banks) or
registered (global or deÑnitive).
We will provide you with a Pricing Supplement describing the speciÑc terms, pricing information and other
information for each issue of Debt Securities. The Pricing Supplement for a speciÑc issue of Debt Securities will
supplement and may amend this OÅering Circular with respect to that issue of Debt Securities. The applicable Pricing
Supplement will describe whether the related issue of Debt Securities is a general or subordinated obligation, whether
principal is payable at maturity or periodically, whether principal is redeemable prior to maturity, and whether interest is
payable at a Ñxed or variable rate or if no interest is payable.
We may list some Debt Securities issued under this Facility on the Luxembourg Stock Exchange or the Singapore
Exchange Securities Trading Limited and have applied for these listings. Our application with the Luxembourg Stock
Exchange applies to Debt Securities issued within twelve months of the date of this OÅering Circular. We may also
issue unlisted Debt Securities and Debt Securities listed on other exchanges under this Facility.
Some Debt Securities are complex Ñnancial instruments and may not be suitable investments for you. You
should consider carefully the risk factors described beginning on page 10. You should not purchase Debt
Securities unless you understand and are able to bear these and any other applicable risks. You should purchase
Debt Securities only if you understand the information contained in this OÅering Circular, the related Pricing
Supplement for the Debt Securities you are considering purchasing and the documents that we incorporate by
reference in this OÅering Circular.
Because of applicable U.S. securities law exemptions, we have not registered the Debt Securities with any U.S.
federal or state securities commission. No U.S. securities commission has reviewed this OÅering Circular.
The Debt Securities are obligations of Freddie Mac only. The Debt Securities, including any interest or return of
discount on the Debt Securities, are not guaranteed by, and are not debts or obligations of, the United States or any
agency or instrumentality of the United States other than Freddie Mac.
The Index of DeÑned Terms (Appendix A) shows where deÑnitions of deÑned terms appear in this OÅering
Circular.
Arranger
LEHMAN BROTHERS
""Reference SecuritiesSM'' is a service mark of Freddie Mac and Reference Notes» securities is a registered trademark of Freddie Mac.
The Debt Securities generally will not have an established trading market when issued. Certain Dealers
have advised Freddie Mac that they intend to use reasonable eÅorts to make a secondary market in the Debt
Securities that they oÅer. However, they are not obligated to do so. These Dealers could discontinue their
secondary market activities at any time without notice. There is no assurance that a secondary market for any
of the Debt Securities will develop or, if such a market develops, that it will continue or will be liquid.
Consequently, you may not be able to sell your Debt Securities readily or at prices that will enable you to realize
your anticipated yield.
If you intend to purchase Debt Securities, you should rely only on the information in this OÅering Circular
and in any related Pricing Supplement for those Debt Securities, including the information in any documents we
incorporate by reference. We have not authorized anyone to provide you with diÅerent information. We are not
oÅering the Debt Securities in any jurisdiction that prohibits their oÅer. This OÅering Circular, any related
Pricing Supplements and any incorporated documents speak only as of their dates, regardless of the date you
receive these documents or purchase Debt Securities. These documents may not be correct after their dates.
Some jurisdictions may restrict by law the distribution of this OÅering Circular or any Pricing Supplement
and the oÅer, sale and delivery of Debt Securities. Persons who receive this OÅering Circular or any Pricing
Supplement should know and observe these restrictions.
We have not registered the Debt Securities under the Securities and Exchange Law of Japan (the
""Securities and Exchange Law''), and we may not directly or indirectly oÅer and sell Debt Securities in Japan
or to any resident of Japan or to any person for reoÅering or resale, directly or indirectly, in Japan or to any
resident of Japan except in compliance with, or under an available exemption from, the registration requirements of the Securities and Exchange Law and in compliance with other relevant laws of Japan.
For a further description of some additional restrictions on oÅers, sales and deliveries of Debt Securities
and on the distribution of the OÅering Circular, any Pricing Supplement or any other supplement or amendment,
see ""Distribution Arrangements Ì Selling Restrictions'' and ""General Information.''
Neither the Luxembourg Stock Exchange nor the Singapore Exchange Securities Trading Limited (the
""Singapore Stock Exchange'') assumes responsibility for the correctness of any of the statements made or
opinions expressed or reports contained or incorporated by reference in this OÅering Circular. Admission to the
OÇcial List of the Luxembourg Stock Exchange or the Singapore Stock Exchange is not to be taken as an
indication of the merits of Freddie Mac or the Debt Securities.
After making all reasonable inquiries as of the date of this OÅering Circular, we conÑrm that this OÅering
Circular contains all the information about the Debt Securities which, when read together with the applicable
Pricing Supplement and the documents incorporated by reference, is material, in the context of the initial issue
of each oÅering of the Debt Securities. We also conÑrm that the information in this OÅering Circular, as of its
date, is true and accurate in all respects and is not misleading and that there are no facts, the omission of
which, makes this OÅering Circular as a whole or any such information misleading in any material respect.
Neither this Offering Circular nor any Pricing Supplement describes all of the risks and investment
considerations applicable to Debt Securities whose principal or interest we pay in or determine by reference to
one or more currencies or to one or more interest rate, currency or other indices or formulas. We and the Dealers
disclaim any responsibility to advise prospective investors of these risks and investment considerations as they
exist at the date of this Offering Circular or any Pricing Supplement or as these risks may change from time to
time. Prospective investors should consult their own financial, tax and legal advisors as to the risks and
investment considerations arising from an investment in such Debt Securities. Such Debt Securities are not an
appropriate investment for investors who are unsophisticated regarding currency transactions or transactions
involving the applicable interest rate, currency or other indices or formulas. See ""Risk Factors.''
This OÅering Circular replaces and supersedes the OÅering Circular dated April 4, 2003 for issues of
Debt Securities priced on and after the date of this OÅering Circular. This OÅering Circular relates to Debt
Securities issued under this Facility and not to any other securities of Freddie Mac, including Debentures,
Medium-Term Notes, Discount Notes, Euro Discount Notes, Estate NotesSM, FreddieNotesSM and Reference
Bills» securities. We oÅer those other securities under separate oÅering circulars.
Estate NotesSM and ""FreddieNotesSM'' are service marks of Freddie Mac, and ""Reference Bills»'' securities is a registered
trademark of Freddie Mac.
2
TABLE OF CONTENTS
Description
Freddie MacÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Available Information ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Summary ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Risk Factors ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The Debt Securities May Not Be Suitable For You ÏÏÏÏÏÏÏÏÏÏ
Structured Debt Securities May Be Complex and Involve
Greater Risks ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Exchange Rate Risks and Exchange Controls May AÅect the
Timing or Amount of Interest and Principal Paid on Your
Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Various Factors Could Adversely AÅect the Trading Value
and Yield of Your Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Secondary Markets and Market Values ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Subordinated Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Redeemable Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Fixed Rate Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Zero Coupon Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Step Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Variable Rate Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Fixed/Variable Rate Debt SecuritiesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Securities with Variable or Amortizing Principal
Repayment ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Securities Eligible for StrippingÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Legal Investment Considerations May Restrict Certain
InvestorsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Credit Ratings May Not ReÖect All Risks ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Description of the Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
General ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
SpeciÑed Currencies and SpeciÑed Payment Currencies ÏÏ
Denominations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Status of Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Maturity, Redemption and Optional RepaymentÏÏÏÏÏÏÏÏÏÏÏ
Interest Payments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Corrections ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Business Day Convention ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Subordinated Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Targeted Registered Issues ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Reopened Issues ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Repurchase ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Clearance and Settlement ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
General ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Clearance and Settlement ProceduresÌPrimary
Distribution ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Clearance and Settlement ProceduresÌSecondary Market
Transfers ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Book-Entry Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Title ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Payments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Fiscal AgentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Registered Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Title ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Payments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Global Agent ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Exchange for DeÑnitive Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Currency ConversionsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Payment for Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Payment on DTC Registered Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Global Facility Agreement ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Binding EÅect of the Global Facility Agreement ÏÏÏÏÏÏÏÏÏÏÏÏÏ
Page
Description
4
4
6
10
10
Various Matters Regarding Freddie Mac ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Events of Default ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Rights Upon Event of Default ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Amendment ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Replacement ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Securities Acquired by Freddie Mac ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Notice ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Governing Law ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Certain United States Federal Tax Consequences ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
U.S. Owners ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
In GeneralÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Payments of Interest ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Obligations with Original Issue Discount ÏÏÏÏÏÏÏÏÏÏÏÏ
Callable Debt Obligations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Obligations with a Term of One Year or Less ÏÏÏÏÏÏÏ
Acquisition Premium and Market Discount ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Obligations Purchased at a Premium ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Accrual Method ElectionÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Disposition or Retirement of Debt Obligations ÏÏÏÏÏÏÏÏÏÏÏÏ
Exchange of Amounts in Non-U.S. Currency ÏÏÏÏÏÏÏÏÏÏÏÏÏ
Stripped Debt Obligations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Subordinated Debt Obligations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Non-U.S. Owners ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Interest ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Disposition or Retirement of Debt Obligations ÏÏÏÏÏÏÏÏÏÏÏÏ
U.S. Federal Estate and Gift Taxes ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Information Reporting and Backup WithholdingÏÏÏÏÏÏÏÏÏÏÏÏÏ
U.K. Stamp Duty and Stamp Duty Reserve Tax (""SDRT'') ÏÏÏÏÏÏ
European Union Directive on Taxation of Savings Income ÏÏÏÏÏÏÏ
Application of Proceeds ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Legal Investment Considerations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Distribution Arrangements ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Distribution ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Sales to Dealers as Principal ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Non-Underwritten Sales ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Targeted Registered Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Sales Directly to Investors ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Stabilization and Other Market Transactions ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Additional Information ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Trading Markets ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Selling Restrictions ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
General ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
United Kingdom ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
JapanÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
France ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Germany ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Hong KongÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Singapore ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Targeted Registered Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Legality of the Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
General Information ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Capitalization ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Selected Financial Data ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Appendix A Ì Index of DeÑned Terms* ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Appendix B Ì Information Statement dated February 27, 2004
10
11
12
12
13
13
14
14
14
15
15
16
16
16
16
16
17
17
18
19
19
20
28
29
29
32
32
32
32
32
34
34
35
35
36
36
36
37
37
38
39
41
41
41
42
42
Page
42
42
43
44
45
45
45
46
46
47
47
48
48
49
50
50
51
52
52
53
53
54
54
54
55
55
56
56
56
57
57
57
57
58
58
58
58
58
59
60
60
60
61
61
61
62
62
62
62
63
63
65
67
68
* We use deÑned terms throughout this OÅering Circular. Appendix A
provides the page locations of the deÑnitions of these terms.
3
FREDDIE MAC
The Federal Home Loan Mortgage Corporation (""Freddie Mac'') is one of the largest
participants in the U.S. mortgage market. We are a shareholder-owned government-sponsored
enterprise, or GSE, chartered by Congress on July 24, 1970 under the Federal Home Loan
Mortgage Corporation Act, which we refer to in this OÅering Circular as the ""Freddie Mac Act.'' Our
statutory purposes are:
‚ to provide stability in the secondary market for residential mortgages;
‚ to respond appropriately to the private capital markets;
‚ to provide ongoing assistance to the secondary market for residential mortgages,
including mortgages on housing for low- and moderate-income families; and
‚ to promote access to mortgage credit throughout the United States (including central
cities, rural areas and underserved areas) by increasing the liquidity of mortgage
investments and improving the distribution of investment capital available for residential
mortgage Ñnancing.
We fulÑll these statutory purposes primarily by purchasing residential mortgages and mortgage
securities from mortgage lenders, other mortgage sellers and securities dealers. We Ñnance our
purchases with debt and equity securities and by guaranteeing the timely payment of principal and
interest on mortgage securities.
AVAILABLE INFORMATION
We prepare an annual Information Statement that describes our business and operations and
contains important Ñnancial and other information, including our consolidated Ñnancial statements
(the ""Information Statement''). We also prepare quarterly and other periodic Information Statement
Supplements that include unaudited consolidated Ñnancial data and other information concerning
our business and operations (each an ""Information Statement Supplement''). These documents
are (or upon publication will be) incorporated by reference in this OÅering Circular, which means
that we are disclosing information to you by referring you to those documents. These documents are
considered part of this OÅering Circular. You should read this OÅering Circular, and any applicable
supplements or amendments, in conjunction with our most recent Information Statement and any
subsequent Information Statement Supplements we incorporate by reference in this OÅering
Circular. As of the date of this OÅering Circular, our current Information Statement (which is
attached as Appendix B to this OÅering Circular) is dated February 27, 2004 and contains our
restated and revised Ñnancial statements for the years 2002, 2001 and 2000. The public release of
our 2003 Ñnancial results has been delayed. Our objective is to release quarterly and full-year
results for 2003 by June 30, 2004. However, there can be no assurance that we will meet this
objective. You should rely only on the most current information provided or incorporated by
reference in this OÅering Circular and any applicable supplement or amendment.
You can obtain any of these documents, the Global Facility Agreement and any other documents that we make available by contacting us at:
Freddie Mac
Debt Securities Marketing OÇce
1551 Park Run Drive
McLean, Virginia U.S.A. 22102-3110
E-Mail: debt securities@freddiemac.com
www.freddiemac.com*
You also can read the Information Statement and other information about Freddie Mac at the
oÇces of the New York Stock Exchange.
In connection with the application to list Debt Securities to be issued under this Facility on the
Luxembourg Stock Exchange, we have deposited copies of the Freddie Mac Act and Bylaws of
Freddie Mac and a legal notice relating to the issuance of the Debt Securities with the Luxembourg
* We are providing this Internet address solely for the information of prospective investors. We do not intend this Internet
address to be an active link and are not using reference to this address to incorporate additional information into this
OÅering Circular or any Pricing Supplement.
4
Register of Commerce and Companies, where copies may be inspected or obtained upon request.
So long as any Debt Securities are listed on the Luxembourg Stock Exchange, and the rules of such
exchange or any relevant authority so require, copies of the OÅering Circular (and all documents
incorporated by reference) will be available free of charge from the principal oÇces of Banque
Generale du Luxembourg, S.A. in Luxembourg. You may inspect copies of the Fiscal Agency
π π
Agreement and the Global Agency Agreement at the principal oÇces of Banque Generale du
π π
Luxembourg, S.A. in Luxembourg.
We have agreed, in connection with the listing of the Debt Securities on the Luxembourg Stock
Exchange and the Singapore Stock Exchange that, so long as any Debt Securities remain
outstanding and listed on one of those exchanges, in the event of any material adverse change in
the business or the Ñnancial position of Freddie Mac that is not reÖected in this OÅering Circular as
then amended or supplemented (including the documents incorporated by reference), we will
prepare an amendment or supplement to this OÅering Circular or publish a new OÅering Circular if
we subsequently oÅer or list Debt Securities. If the terms of the Facility are modiÑed or amended in a
manner that would make this OÅering Circular, as amended or supplemented, inaccurate or
misleading, we will prepare a further amendment to this OÅering Circular or a new OÅering Circular.
5
SUMMARY
This Summary contains selected information about the Debt Securities. It does not contain all of the
information you should consider before purchasing the Debt Securities. You should refer to the remainder
of this OÅering Circular and to any related Pricing Supplement for further information. If a Pricing
Supplement contains diÅerent information from this OÅering Circular, you should rely on the Pricing
Supplement.
Issuer ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Freddie Mac,
enterprise.
a
shareholder-owned
government-sponsored
Debt Securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Unsecured subordinated or unsubordinated notes, bonds and other
debt securities issued from time to time under the Global Debt
Facility (the ""Facility''). We have established the Facility under the
Global Debt Facility Agreement dated the same date as this OÅering Circular (the ""Global Facility Agreement'').
Reference Securities ÏÏÏÏÏÏÏÏ
We will designate some Debt Securities as ""Reference Securities,''
which are regularly scheduled U.S. dollar or euro denominated
issues in large principal amounts. Reference Notes» securities
(""Reference Notes'') are U.S. dollar denominated, non-callable
Debt Securities with maturities of one to ten years. Reference
Bonds» securities (""Reference Bonds'') are U.S. dollar denominated, non-callable Debt Securities with maturities of more than ten
years. Callable Reference NotesSM securities (""Callable Reference
Notes'') are U.S. dollar denominated, callable Debt Securities with
maturities of one to ten years. 0Reference Notes» securities
(""0Reference Notes'') are euro denominated, non-callable Debt
Securities with maturities of one to ten years. 0Reference BondsSM
securities (""0Reference Bonds'') are euro denominated, noncallable Debt Securities with maturities of more than ten years. We
refer to 0Reference Notes and 0Reference Bonds, collectively, as
""0Reference SecuritiesSM.'' Issuances may consist of new issues
of Reference Securities or the ""reopening'' of an existing issue.
Other Debt Securities ÏÏÏÏÏÏÏ
We will issue other Debt Securities from time to time in U.S. dollars or
other currencies with maturities of one day or longer. Debt Securities with maturities of one to ten years will be called ""Notes'' and
those with maturities of more than ten years will be called ""Bonds.''
These Debt Securities may be callable or non-callable.
ArrangerÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Lehman Brothers International (Europe).
AmountÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
We may issue an unlimited amount of Debt Securities.
Legal Status ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Unless otherwise speciÑed in the applicable Pricing Supplement, the
Debt Securities will be unsecured general obligations having the
same priority as all of our other unsecured and unsubordinated
debt and ranking senior to any subordinated debt. If speciÑed in the
applicable Pricing Supplement, the Debt Securities will be unsecured subordinated obligations with the terms, including but not
limited to terms relating to payment priority or payment suspension,
limitation or deferral (if any), set forth in the applicable Pricing
Supplement (""Subordinated Debt Securities''). The United States
does not guarantee the Debt Securities or any interest or return of
discount on the Debt Securities. The Debt Securities are not debts
or obligations of the United States or any agency or instrumentality
of the United States other than Freddie Mac.
Pricing Supplements ÏÏÏÏÏÏÏÏÏÏ
We will oÅer Debt Securities by means of a ""Pricing Supplement'' that
will describe the speciÑc terms, pricing information and other
information for each issue of Debt Securities.
""Callable Reference NotesSM,'' ""0Reference SecuritiesSM'' and ""0Reference BondsSM'' are service marks of Freddie Mac.
""Reference Notes»,'' ""0Reference Notes»'' and ""Reference Bonds»'' are registered trademarks of Freddie Mac.
6
SpeciÑed Currencies ÏÏÏÏÏÏÏÏÏÏ
We may denominate and make payments of principal and interest on
the Debt Securities in any of the following SpeciÑed Currencies or
in another currency speciÑed in the applicable Pricing Supplement
subject to compliance with all relevant laws and regulations.
Australian dollars
British pounds sterling (""Sterling'')
Canadian dollars
Danish kroner
Euros
Hong Kong dollars
Japanese yen (""Yen'')
New Zealand dollars
Swedish kronor
Swiss francs
U.S. dollars
Government or monetary authorities or clearing systems may require
that Debt Securities denominated in certain currencies or currency
units have certain denominations or have minimum or maximum
maturities. The current minimum maturity for Debt Securities listed
on the Luxembourg Stock Exchange is seven days and for Debt
Securities listed on the Singapore Stock Exchange is one month.
Denominations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
We will issue and maintain U.S. dollar denominated Debt Securities in
minimum principal amounts of U.S. $2,000 and additional increments of U.S. $1,000, unless otherwise indicated in the related
Pricing Supplement. We will issue and maintain 0Reference Securities in minimum principal amounts and additional increments of
01,000, unless otherwise indicated in the related Pricing Supplement. The denominations for all other non-U.S. dollar denominated
Debt Securities will be set forth in the applicable Pricing
Supplement.
Any Debt Securities in respect of which the issue proceeds are
received by us in the United Kingdom and which have a maturity of
less than one year from the date of issue must (a)(i) have a
minimum redemption value of 100,000 (or an amount of
equivalent value denominated wholly or party in another currency)
and no part of any such Debt Security may be transferred unless
the redemption value of that part is not less than 100,000 (or such
equivalent amount) and (ii) be issued only to persons whose
ordinary activities involve them in acquiring, holding, managing or
disposing of investments (as principal or agent) for the purposes
of their businesses; or who it is reasonable to expect will acquire,
hold, manage or dispose of investments (as principal or agent) for
the purposes of their businesses or (b) be issued in other circumstances which do not constitute a contravention of section 19 (the
general prohibition) of the Financial Services and Markets Act 2000
(the ""FSMA'').
Redemption and
Repayment ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
We may have the option to redeem some Debt Securities, in whole or
in part, before their Maturity Dates. Also, holders of some Debt
Securities may have the option to require repayment of their Debt
Securities, in whole or in part, before their Maturity Dates. The
Pricing Supplement for an issue of Debt Securities will say whether
the Debt Securities are redeemable at our option or repayable at
your option and will describe the redemption or repayment right.
Payment Terms ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The related Pricing Supplement will specify the payment terms of the
Debt Securities.
PrincipalÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The principal amount payable at maturity or upon redemption or
repayment of the Debt Securities may be a Ñxed amount, which
may be at, above or below par. The principal amount payable also
may be a variable amount determined by reference to one or more
indices, such as interest or exchange rate indices, or other formulas. The principal amount may be amortized through periodic
payments during the term of the Debt Securities.
7
InterestÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Securities may bear interest at Ñxed or variable rates (or a
combination of Ñxed and variable rates), or may bear interest that
is indexed by reference to an interest or currency exchange rate or
in some other manner, or may not bear interest.
Stripping ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The applicable Pricing Supplement will indicate whether the Debt
Securities may be stripped into interest and principal components.
Form of Debt Securities ÏÏÏÏÏÏÏ
We will issue Debt Securities in either book-entry form or registered
form and not in bearer form.
Book-Entry Debt Securities ÏÏ
Debt Securities denominated and payable in U.S. dollars that are
issued in book-entry form on the book-entry system (""Fed BookEntry System'') of the U.S. Federal Reserve Banks (individually, a
""Federal Reserve Bank'' and, collectively, the ""Federal Reserve
Banks''). Debt Securities on the Fed Book-Entry System may be
held of record only by entities eligible to maintain book-entry
accounts with a Federal Reserve Bank (""Fed Participants''). Holders may not exchange Book-Entry Debt Securities for deÑnitive
Debt Securities.
Registered Debt Securities ÏÏ
Debt Securities that are not Book-Entry Debt Securities. We generally
will issue Registered Debt Securities in global registered form but
may issue Registered Debt Securities in deÑnitive registered form if
speciÑed in the applicable Pricing Supplement. Holders may exchange Registered Debt Securities in global registered form for
deÑnitive Debt Securities only in the limited circumstances described in this OÅering Circular. See ""Description of the Debt
Securities Ì Registered Debt Securities Ì Exchange for DeÑnitive
Debt Securities.''
Fiscal Agents ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The Federal Reserve Banks will act as Fiscal Agents for Book-Entry
Debt Securities under a Fiscal Agency Agreement (the ""Fiscal
Agency Agreement'').
Global Agent ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Citibank, N.A.'s London oÇce (""Citibank Ì London'') is the Global
Agent for Registered Debt Securities under a Global Agency Agreement (the ""Global Agency Agreement'').
Clearance and Settlement ÏÏÏÏÏ
Depending on the terms of an issue of Debt Securities and where they
are oÅered, the Debt Securities may clear and settle through one or
more of the following:
‚ the Federal Reserve Banks,
‚ the Depository Trust Company (""DTC''),
‚ Euroclear,
‚ Clearstream, Luxembourg, or
‚ any other designated clearing systems.
Most Debt Securities denominated and payable in U.S. dollars, including all U.S. dollar denominated Reference Securities, will clear and
settle through the Fed Book-Entry System if distributed within the
United States, and through Euroclear and/or Clearstream, Luxembourg if distributed outside the United States. Most Debt Securities
denominated and payable in a SpeciÑed Currency other than U.S.
dollars, including all 0Reference Securities, will clear and settle
through DTC if distributed within the United States, and through
Euroclear and/or Clearstream, Luxembourg if distributed outside
the United States.
Governing LawÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The Debt Securities will be governed by the federal laws of the United
States. The laws of the State of New York will be deemed to reÖect
the federal laws of the United States, unless there is applicable
precedent under federal law or the application of New York law
would frustrate the purposes of the Freddie Mac Act or the Global
Facility Agreement.
8
Tax StatusÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
The Debt Securities and income or return of discount derived from the
Debt Securities generally are subject to taxation by the United
States and generally are not exempt from taxation by other U.S. or
non-U.S. taxing jurisdictions. Unless they establish an exemption
by Ñling a form W-8BEN or otherwise, Non-U.S. Owners generally
will be subject to United States federal income and withholding tax.
See ""Certain United States Federal Tax Consequences Ì NonU.S. Owners Ì Interest.''
We will not pay additional interest or other amounts or redeem the
Debt Securities prior to maturity if any jurisdiction imposes any
withholding or other tax on payments on the Debt Securities. If any
particular issue of Debt Securities is ""targeted to foreign markets''
under U.S. tax regulations, the related Pricing Supplement will
describe any special tax considerations that apply.
Listing ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Luxembourg Transfer, Paying
and Listing Agent ÏÏÏÏÏÏÏÏÏÏÏ
The applicable Pricing Supplement will specify the exchange, if any,
on which we will apply to list a particular issue of Debt Securities.
We may list some Debt Securities issued under this Facility on the
Luxembourg Stock Exchange or the Singapore Stock Exchange
and have applied for such listings. Our application with the Luxembourg Stock Exchange applies to Debt Securities issued within
twelve months of the date of this OÅering Circular. We may list an
issue of Debt Securities on one, both or neither of these exchanges. We may also list an issue of Debt Securities on other
exchanges or no exchange at all.
Banque Generale du Luxembourg, S.A.
π π
Method of DistributionÏÏÏÏÏÏÏÏÏ
We generally will sell the Debt Securities to one or more Dealers
acting as principals for resale to investors either at a Ñxed price or
at varying prices determined by the relevant Dealer or Dealers.
These sales may be by auction or other methods. The applicable
Pricing Supplement will specify the names of the Dealer or Dealers
for a particular issuance of Debt Securities. Alternatively, we may
allow Dealers to solicit purchases of Debt Securities on an agency
basis or we may sell Debt Securities directly to investors.
OÅering Price ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ
Debt Securities may be oÅered at Ñxed prices equal to par, or at a
discount to or premium over par, or at varying prices relating to
prevailing market prices at the time of resale as determined by the
applicable Dealer, as speciÑed in the applicable Pricing
Supplement.
Selling Restrictions ÏÏÏÏÏÏÏÏÏÏÏ
Some jurisdictions restrict the oÅers and sales of Debt Securities and
the distribution of oÅering materials. If any particular issue of Debt
Securities is ""targeted to foreign markets'' under U.S. tax regulations, the Pricing Supplement for the Debt Securities will describe
the selling restrictions that apply. See ""Distribution Arrangements Ì Selling Restrictions.''
9
RISK FACTORS
This section describes some of the general risks and considerations that you should examine
before investing in the Debt Securities. There may be other risks and considerations not discussed
below or discussed in the applicable Pricing Supplement that you should consider. These risks and
considerations may vary depending on your particular circumstances and on various economic,
interest rate and exchange rate scenarios. Therefore, you should consult your own Ñnancial and legal
advisors to determine the suitability for you of a particular issue of Debt Securities.
The Debt Securities May Not Be Suitable For You
The Debt Securities are not suitable investments for all investors. Before investing in a
particular issue of Debt Securities, you should:
‚ possess, either alone or with an investment advisor, the expertise and analytical tools
necessary to evaluate, in the context of your Ñnancial situation, the particular features of
the Debt Securities, the risks and beneÑts of investing in the Debt Securities and the
eÅect of the Debt Securities on your overall investment portfolio;
‚ have suÇcient Ñnancial resources and liquidity to bear the risks associated with the Debt
Securities;
‚ understand the information contained and incorporated in this OÅering Circular and any
related Pricing Supplement;
‚ understand the terms of the Debt Securities; and
‚ understand any applicable legal investment restrictions.
Sophisticated institutional investors generally do not purchase complex Debt Securities as
stand-alone investments. Rather, they may invest in certain types of complex Debt Securities to
reduce the risk of their overall portfolio or to enhance their yield by adding an appropriate level of
risk to their overall portfolio. You should not purchase any Debt Securities unless you understand
and are able to bear the associated yield, market, liquidity and structure risks, including risks
associated with any redemption provisions, periodic interest rate adjustments and exchange rates
and controls. You should decide whether to invest in an issue of Debt Securities based on your own
Ñnancial needs and the anticipated performance of the Debt Securities under a variety of economic,
interest rate and exchange rate scenarios.
Structured Debt Securities May Be Complex and Involve Greater Risks
If principal or interest on an issue of Debt Securities is either directly or inversely determined by
reference to one or more interest rates, currencies (including exchange rates and swap indices
between currencies or currency units) or other indices or formulas, then an investment in the Debt
Securities would entail signiÑcant risks not associated with an investment in a conventional Ñxed
rate debt security. These risks include the possibility that:
‚ the applicable index or indices may change signiÑcantly;
‚ changes in the applicable index or indices may not correlate with changes in interest
rates or currencies generally or with changes in other indices;
‚ changes in the applicable index or indices will be magniÑed or diminished if the Debt
Securities' principal or interest formula contains a leverage factor or a deleverage factor;
‚ the applicable index or indices may be subject to maximum (""Cap'') or minimum
(""Floor'') interest rate or exchange rate limitations;
‚ the timing of changes in an applicable index or indices may aÅect your actual yield, even
if the average level is consistent with your expectations (in general, the earlier the
change in the applicable index or indices, the greater the eÅect on yield);
10
‚ two or more indices or formulas that you may expect to move in tandem or in some other
relationship to each other may unexpectedly converge, diverge or otherwise not move as
expected;
‚ currency devaluations may occur or monetary authorities may impose or modify currency
exchange controls;
‚ the resulting interest rate may be less than the interest rate payable on a conventional
Ñxed rate debt security we issued at the same time and, in some cases, may be as low as
zero;
‚ you may receive repayments of principal at times other than you expect;
‚ you may lose all or a substantial portion of the principal of your Debt Security (whether
payable at maturity, upon redemption or otherwise); and
‚ the value of Debt Securities with complex formulas or other terms may be volatile.
These risks may depend on a number of interrelated factors that we cannot control, including
Ñnancial, economic, regulatory and political developments. In the past, certain interest rates,
currencies, currency units, exchange rates and indices have been highly volatile. This volatility may
continue in the future. Past Öuctuations in any particular interest rate, currency, currency unit,
exchange rate or index do not necessarily indicate the Öuctuations that may occur in the future.
You should have knowledge of, and access to, appropriate analytical tools to evaluate
quantitatively the eÅect of the particular features of the Debt Securities you are considering
purchasing and the resulting eÅects upon their yields and values.
Exchange Rate Risks and Exchange Controls May AÅect the Timing or Amount of Interest and
Principal Paid on Your Debt Securities
We will denominate each issue of Debt Securities in one or more SpeciÑed Currencies in which
we will pay principal and any interest. We may determine the amount of principal or interest
payments on an issue of Debt Securities by reference to one or more SpeciÑed Currencies
(including exchange rates and swap indices between currencies or currency units) that may be
diÅerent from the denominated SpeciÑed Currency. You may conduct your Ñnancial activities in a
currency other than the Debt Securities' denominated SpeciÑed Currencies or other than the
SpeciÑed Currencies that determine the amount of the Debt Securities' principal or interest
payments. In those cases, an investment in the Debt Securities involves more risks than if the Debt
Securities were denominated in or indexed solely to your currency. These risks include the
possibility that:
‚ the rate of exchange between the applicable SpeciÑed Currency and your currency may
change signiÑcantly (including changes as a result of devaluation of the SpeciÑed
Currency or revaluation of your currency);
‚ changes in exchange rates may decrease the eÅective yield on the Debt Securities and,
in certain circumstances, you could lose all or a substantial portion of the principal of the
Debt Securities;
‚ if the value of your currency appreciates relative to the value of the applicable SpeciÑed
Currency, the yield on the Debt Securities, the value of payments on the Debt Securities
and the market value of the Debt Securities all would decrease in terms of your currency.
A depreciation in the value of your currency relative to the value of the applicable
SpeciÑed Currency would have the opposite eÅect; and
‚ authorities with jurisdiction over the applicable SpeciÑed Currency or your currency may
impose or modify currency exchange controls.
In the past, certain exchange rates and indices have been highly volatile. This volatility may
continue in the future. Past Öuctuations in any particular exchange rate or index, however, do not
necessarily indicate the Öuctuations that may occur in the future.
11
Government and monetary authorities have imposed, and may impose in the future, exchange
controls that could aÅect exchange rates as well as the availability of the applicable SpeciÑed
Currency when payments of principal or interest are due on an issue of Debt Securities. Even in the
absence of actual exchange controls, it is possible that when payments on a particular issue of Debt
Securities are due:
‚ the government issuing the applicable SpeciÑed Currency (or any successor to that
SpeciÑed Currency) may no longer use the SpeciÑed Currency (or any successor
currency);
‚ the international banking community may no longer use the applicable SpeciÑed Currency (or any successor currency) to settle transactions; and
‚ the applicable SpeciÑed Currency (or any successor currency) may no longer be
available for some other reason.
In these cases, we generally will be entitled to satisfy our obligations on the Debt Securities in
U.S. dollars. In addition, under certain circumstances, we may make payments in euros for Debt
Securities originally denominated in currencies replaced by the euro. See ""Description of the Debt
Securities Ì General Ì SpeciÑed Currencies and SpeciÑed Payment Currencies Ì Unavailability.''
Various Factors Could Adversely AÅect the Trading Value and Yield of Your Debt Securities
Secondary Markets and Market Values
The Debt Securities generally will not have an established trading market when issued. Certain
Dealers have advised us that they intend to use reasonable eÅorts to make a secondary market in
the Debt Securities that they oÅer, but, in general, they are not obligated to do so. These Dealers
may discontinue any such secondary market making at any time without notice. Consequently:
‚ a secondary market for any of the Debt Securities may not develop, particularly for those
Debt Securities that are especially sensitive to interest rate or market risks or are
structured to meet the investment requirements of limited categories of investors; or
‚ if it develops, such a market may not be liquid at all times.
As a result, you may not be able to sell your Debt Securities easily or at prices comparable to
similar instruments with a developed secondary market. If you are seeking to purchase or sell very
small or very large amounts of Debt Securities, you may not be able to do so at prices comparable to
those available to other investors.
The market values of Debt Securities likely will Öuctuate over time, perhaps signiÑcantly. These
Öuctuations could cause signiÑcant losses to your investment in Debt Securities, especially if you
dispose of your Debt Securities prior to their maturity. The market prices of instruments issued at
either a substantial discount (such as Zero Coupon Debt Securities) or a substantial premium
(such as Debt Securities with signiÑcantly above-market interest rates) from their principal amount
tend to Öuctuate more in relation to general changes in interest rates than do the prices of securities
with comparable maturities that are not issued at such a discount or premium.
A number of factors may aÅect any secondary market for, and the market value of, an issue of
Debt Securities, including:
‚ the creditworthiness of Freddie Mac;
‚ the value, complexity and volatility of any applicable index or indices;
‚ the method of calculating principal or interest payments on the Debt Securities;
‚ the remaining time to maturity of the Debt Securities;
‚ any redemption or repayment features of the Debt Securities;
‚ the outstanding amount of the Debt Securities;
‚ the amount of other securities linked to any applicable index or indices;
12
‚ the amount of Debt Securities being sold in any secondary market from time to time;
‚ the subordinated status or other terms of any Subordinated Debt Securities;
‚ the stability of U.S. and non-U.S. currencies;
‚ any legal restrictions or tax treatment that limits demand for the Debt Securities;
‚ the availability of comparable securities, including comparable U.S. Treasury securities;
‚ Öuctuations in the ""spread'' of the Debt Securities to comparable U.S. Treasury securities; and
‚ the level, direction and volatility of market interest rates generally.
You should not purchase any Debt Securities unless you understand and can bear the risks that
you may not be able to resell them easily, that their value will Öuctuate over time and that these
Öuctuations may be signiÑcant and cause signiÑcant losses to you. Illiquidity may have a severely
adverse eÅect on the market values of the Debt Securities. These risks of limited liquidity and price
volatility are greatest for Debt Securities that are:
‚ especially sensitive to interest rate, currency or market risks;
‚ designed for speciÑc investment objectives or strategies;
‚ structured to meet the investment requirements of limited categories of investors; or
‚ not held until maturity.
Subordinated Debt Securities
If speciÑed in the applicable Pricing Supplement, the indebtedness represented by Subordinated Debt Securities and the payment of principal of and interest on these Subordinated Debt
Securities may be subordinated to prior payment in full of all of our ""Senior Obligations'' (as deÑned
herein) which are due and payable. Therefore, we will not be permitted to make any payments of
principal of or interest on the Subordinated Debt Securities (including redeeming any redeemable
Subordinated Debt Securities) while we are in default on any of our Senior Obligations. In the event
of a liquidation or dissolution of Freddie Mac, our assets would not be available to pay obligations
under the Subordinated Debt Securities until our Senior Obligations have been paid in full. Such
Senior Obligations will be identiÑed by category in the applicable Pricing Supplement.
In addition, there may be other terms applicable to speciÑc oÅerings of Subordinated Debt
Securities that would defer, limit or suspend our obligation to make any payment of principal of or
interest on these Subordinated Debt Securities under certain speciÑed conditions. Moreover, Events
of Default that apply to Senior Obligations may not necessarily be Events of Default for Subordinated Debt Securities. As a result, the Holders of Subordinated Debt Securities may not have the
same acceleration rights as Holders of other Debt Securities. See ""Description of the Debt
Securities Ì General Ì Subordinated Debt Securities,'' ""Global Facility Agreement Ì Events of
Default'' and "" Ì Rights Upon Event of Default.'' The terms and conditions of any issue of
Subordinated Debt Securities will be described in the applicable Pricing Supplement.
Redeemable Debt Securities
We will have the option to redeem the Debt Securities after a speciÑed date if we so provide in
the related Pricing Supplement. The redemption price typically is 100% of the principal amount plus
accrued interest, in the case of Debt Securities that bear interest, and the accreted value to the
redemption date, in the case of Zero Coupon Debt Securities. These optional redemption provisions
are likely to restrict the market values that the Debt Securities would otherwise have. For example,
the market price of the Debt Securities generally will not rise substantially above the redemption
price during (and possibly before) any period when we may redeem the Debt Securities because of
the increased likelihood of redemption. If we redeem a portion of an issue of Debt Securities, the
market for the Debt Securities left outstanding may become less liquid.
13
In general, we are most likely to redeem Debt Securities when prevailing interest rates and our
borrowing costs are relatively low and are least likely to redeem Debt Securities when prevailing
interest rates and our borrowing costs are relatively high. Our decision to redeem or not to redeem
an issue of Debt Securities may also be aÅected by any related hedge or derivative position that we
hold. If we redeem the Debt Securities when prevailing interest rates are relatively low, you may not
be able to reinvest the redemption proceeds in comparable securities with similar yields.
Some Debt Securities may be redeemable at a variable amount determined by reference to one
or more interest rate, exchange rate or other indices. The redemption proceeds of those Debt
Securities will vary depending on the level of the applicable index, and you may receive less than
100% of your original principal amount upon redemption.
Fixed Rate Debt Securities
Fixed Rate Debt Securities, if held to maturity, will provide return of their principal and the
certainty of interest payments at a Ñxed rate. However, the market values of Fixed Rate Debt
Securities are likely to Öuctuate with changes in prevailing interest rates.
The market values of Fixed Rate Debt Securities generally will rise in a falling interest rate
environment and will fall in a rising interest rate environment. This Öuctuation creates risk of loss of
investment capital if you dispose of these Debt Securities prior to maturity. This eÅect on market
values is generally greater for Debt Securities having relatively long remaining terms to maturity than
for Debt Securities having relatively short remaining terms to maturity.
Zero Coupon Debt Securities
An investment in Zero Coupon Debt Securities presents certain risks that are diÅerent from an
investment in Ñxed-rate Debt Securities that pay interest periodically. If you hold the Zero Coupon
Debt Securities to maturity, they will provide return of your principal, including return of the discount,
but their market value is likely to Öuctuate substantially with changes in prevailing interest rates. The
market value of the Zero Coupon Debt Securities generally will fall in a rising interest rate
environment, creating a risk of loss of your investment capital if your circumstances do not permit
you to hold the Zero Coupon Debt Securities to maturity. The market value of the Zero Coupon Debt
Securities generally will rise in a falling interest rate environment. The possibility of substantial price
volatility, combined with the fact that payments on the Zero Coupon Debt Securities will be made
only at maturity, also could aÅect the secondary market for, and the liquidity of, the Zero Coupon
Debt Securities. Zero Coupon Debt Securities that are redeemable involve certain additional risks.
See ""Risk Factors Ì Various Factors Could Adversely AÅect the Trading Value and Yield of Your
Debt Securities Ì Redeemable Debt Securities.''
The market values of Zero Coupon Debt Securities and other Debt Securities issued at
substantial discounts tend to Öuctuate more in relation to general changes in interest rates than do
prices for conventional interest-bearing securities. Generally, the longer their remaining term, the
greater the price volatility as compared to conventional interest-bearing securities with comparable
maturities.
Step Debt Securities
Step Debt Securities provide for one or more prescribed increases (or decreases) in their
interest rates at speciÑed dates. However, we may have the option to redeem Step Debt Securities
at the beginning of or during one or more step periods. Therefore, you should consider the likelihood
that we will redeem Step Debt Securities if their subsequent interest rates exceed the interest rates
then available to us for comparable borrowings.
Although the interest rate on a Step Debt Security may increase on the speciÑed dates, the
increased interest rate may be below the interest rate that you would receive on newly issued but
otherwise comparable instruments.
14
Variable Rate Debt Securities
If the interest rate on a Variable Rate Debt Security bears a direct relationship to a speciÑed
index, lower than anticipated levels of the index could result in actual yields that are lower than
anticipated. Conversely, if the interest rate on a Variable Rate Debt Security bears an inverse
relationship to a speciÑed index, higher than anticipated levels of the index could result in actual
yields that are lower than anticipated.
Inverse Variable Rate Debt Securities have an interest rate equal to a Ñxed rate minus a rate
based upon an applicable index. The market values of inverse Variable Rate Debt Securities
typically are more volatile than market values of our conventional Variable Rate Debt Securities
based on the same applicable index (and with otherwise comparable terms). Inverse Variable Rate
Debt Securities are more volatile because an increase in the applicable index not only decreases the
interest rate of the inverse Variable Rate Debt Security, but also often reÖects an increase in
prevailing interest rates, which further adversely aÅects the market value of these Debt Securities.
The indices applicable to Variable Rate Debt Securities are not likely to remain constant at any
level. The timing of a change in the level of an applicable index may aÅect the actual yield you
receive, even if the average level is consistent with your expectation. In general, the earlier a change
in the level of an applicable index, the greater the eÅect on your yield, especially for Debt Securities
that provide for repayment of principal at one or more times prior to maturity. As a result, the eÅect
on the yield you receive of an index that is lower (or higher) than the rate anticipated during earlier
periods is not likely to be oÅset by a later equivalent increase (or reduction). Moreover, changes in
the index applicable to a particular Variable Rate Debt Security may not correlate with changes in
interest rates generally or with changes in other indices. Your yield could be either adversely or
positively aÅected if changes in the index applicable to your Debt Security do not reÖect changes in
interest rates generally.
The interest rate formula for a Variable Rate Debt Security may include a multiplier that is
applied to an index in determining the applicable interest rate. In general, a multiplier of greater than
one will cause changes in the interest rate of the Debt Security to be more pronounced than
changes in the value of the applicable index, while a multiplier of less than one will have the opposite
eÅect. Variable Rate Debt Securities with multipliers of greater than one are ""leveraged,'' and those
with multipliers of less than one are ""deleveraged.''
In general, the volatility associated with the level of an applicable index is higher for leveraged
Debt Securities and lower for deleveraged Debt Securities. For example, the interest rate of a
leveraged Variable Rate Debt Security bearing an inverse relationship to a speciÑed index generally
will decline sharply as the value of the applicable index increases. By contrast, the interest rate of a
deleveraged Variable Rate Debt Security bearing an inverse relationship to a speciÑed index
generally will decline more slowly as the value of the applicable index increases.
Investors in Variable Rate Debt Securities should consider the eÅects on their interest rates and
yields of any applicable Caps or Floors and of any delays in periodic interest rate adjustments. Some
Variable Rate Debt Securities may provide for no interest to accrue during periods when the
applicable index is outside a speciÑed range. The market values of Variable Rate Debt Securities
with Caps or Floors or with such a range feature generally are more volatile than those of Variable
Rate Debt Securities linked to the same applicable index without Caps or Floors or a range feature,
especially when the applicable index approaches or passes the Cap or Floor or the endpoint of the
applicable range.
Fixed/Variable Rate Debt Securities
Some Fixed/Variable Rate Debt Securities may bear interest at a rate that we may elect to
convert from a Ñxed rate to a variable rate, or from a variable rate to a Ñxed rate. Our ability to
convert the interest rate will aÅect the secondary market and the market values of the Debt
Securities since we may be expected to convert the rate when it is likely to produce a lower overall
15
cost of borrowing. If we convert from a Ñxed rate to a variable rate, the ""spread'' above or below the
applicable index may be less favorable than the prevailing spreads on our conventional Variable
Rate Debt Securities tied to the same index. In addition, the new variable rate at any time may be
lower than the rates on our other Variable Rate Debt Securities. If we convert from a variable rate to
a Ñxed rate, the Ñxed rate may be lower than then prevailing rates on our other Fixed Rate Debt
Securities.
Debt Securities with Variable or Amortizing Principal Repayment
Debt Securities with Variable or Amortizing Principal Repayment Amounts provide for payments
of principal or their redemption price to be determined based on one or more indices. Before
purchasing such a Debt Security you should understand the indices used in calculating payments.
These indices may Öuctuate independently of other indices. Fluctuations in indices may cause you to
receive principal at a diÅerent time or in a lesser amount than you anticipate.
Debt Securities Eligible for Stripping
Some issues of Fixed Rate Debt Securities and Step Debt Securities will be eligible to be
separated (""stripped'') into Interest Components and Principal Components. The related Pricing
Supplement will indicate which issues of Debt Securities are eligible to be stripped. The secondary
market, if any, for the Interest Components and Principal Components of stripped Debt Securities
may be more limited and have less liquidity than the secondary market for Debt Securities of the
same issue that have not been stripped. The liquidity of an issue of Debt Securities also may be
reduced if a signiÑcant portion of the Debt Securities are stripped. See ""Description of the Debt
Securities Ì General Ì Interest Payments Ì Stripped Debt Securities'' for more information on
stripping.
Legal Investment Considerations May Restrict Certain Investors
You should consult your own legal advisors in determining whether the Debt Securities are legal
investments for you and whether you can pledge the Debt Securities as collateral for various types
of borrowings. In addition, if you are a Ñnancial institution, you should consult your legal advisors or
regulators to determine how to treat Debt Securities under any applicable risk-based capital or
similar rules.
Certain legal investment laws and regulations or regulatory authorities may restrict an institution's investment in certain types of Debt Securities or in Debt Securities generally. An institution
under the jurisdiction of regulatory agencies should review any applicable regulations, policy
statements and guidelines before purchasing or pledging Debt Securities.
Credit Ratings May Not ReÖect All Risks
Rating agencies may assign credit ratings to the Debt Securities. Any credit ratings assigned to
Debt Securities may not reÖect the potential impact of all risks related to structure, yield, market,
liquidity and other factors aÅecting their value. A credit rati
