Business: Freddie Mac (Federal Home Loan Mortgage Corp.), Variable Rate, Non-Cumulative Perpetual Preferred Stock, liquidation preference $50 per share, redeemable at the issuer's option on or after 6/30/2011 at $50 per share plus declared and unpaid dividends, and with no stated maturity. Variable rate noncumulative distributions will be paid quarterly on 3/31, 6/30, 9/30 & 12/31 to holders of record as set by the Board which will be 10 to 45 days prior to the payment date (NOTE: the ex-dividend date is one business day prior to the record date). The initial dividend rate is 6.00% through 9/30/06 with a floor rate of 4.00% per annum. The variable rate will be reset quarterly based on the 3-month LIBOR plus 0.50%. Dividends paid by this preferred security are eligible for the preferential income tax rate of 15% to a maximum of 20% depending on the holder's tax bracket (and under IRS specified holding restrictions) and are also eligible for the dividends received deduction for corporate holders (see the prospectus for further information). The security was rated AA- by S&P and Aa3 by Moody's at the IPO. In regards to payment of dividends and upon liquidation, the preferred shares rank equally with other preferreds and senior to the common shares of the company. See the IPO prospectus for further information on the preferred stock by clicking on the ‘Link to IPO Prospectus’ provided below.