First of all, any Amendment of any kind is a breach of contract without director approval (shareholder approval if it "changes the corporation purpose" or "fundamentally changes the structure of the corporation", which I think a 4th Amendment does.).
The 3rd Amendment was a breach of contract, and is in my opinion, the best defense against the NWS. A contract modification between two non-merchants requires additional compensation. While it can definitely be argued there was adequate compensation at the original contract creation, there was NOTHING added to the shareholders' position from the 3rd Amendment, which makes it a complete breach.
Second of all, there is no reason to "sell into the market to use the proceeds towards recapitalization". If the government wants to recapitalize the GSEs, they can hand back the 50 billion dollar overpayment we've made, and which the government claims is keeping in an account for GSE use only, and we will be recapitalized lickidy-split. Or they can just leave the GSEs alone and they will recapitalize quick enough. The GSEs will benefit way more from the cancellation of the warrants than it would from diluting the GSE market so much that no foreign or institutional investor would ever consider investing in such a poor economic environment.
Third of all, it is unlikely that the warrants could play part in any kind of settlement. If one lawsuit agrees to the warrants playing a part, and another lawsuit disagrees, you have a big problem.
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