Freddie Mac 2010 Annual Report Download - page 324

As of December 31, 2010, Messrs. Bostrom, Federico, and Bisenius had vested in their benefits under the Thrift/401(k)
SERP Benefit and the Pension SERP Benefit, while Messrs. Haldeman and Kari had not. The amounts presented in Table 84
do not include vested RSU or stock option awards, vested balances in the Thrift/401(k) SERP Benefit or vested benefits in
the Pension SERP Benefit as of December 31, 2010, because such vesting was not in connection with a termination or
change-in-control. Amounts shown in the tables also do not include certain items available to all employees generally upon a
termination event.
For RSUs, the value shown in the tables is calculated on a grant-by-grant basis by multiplying the number of unvested
RSUs by the closing price of our common stock on December 31, 2010. No value is included in the tables for stock options
because the exercise prices for all such options held by Named Executive Officers are substantially higher than the closing
price of our common stock on December 31, 2010.
Potential Payments to Current Named Executive Officers
The Executive Compensation Program addresses the treatment of Semi-Monthly Base Salary, Deferred Base Salary, and
the Target Incentive Opportunity upon various termination events. In order to be eligible to receive any portion of a Target
Incentive Opportunity installment payment, a Covered Officer must have been employed for a minimum of four whole
calendar months during the performance year to which the award applies.
Additionally, none of the Covered Officers are guaranteed termination benefits upon any type of termination event other
than death or disability and the actual payment of a termination benefit is subject to FHFA review and approval at the time
of payment. The discussion that follows describes the termination benefits, if any, provided upon various types of termination
events.
•Death. Any earned but unpaid Deferred Base Salary or Target Incentive Opportunity installments will be paid as
soon as administratively possible in the event of death. If, at the time of death, the funding level has not been
determined, the award will remain outstanding until such determination is made. Payment will occur as soon as
administratively possible following the determination of the funding level.
•Disability. Treatment upon a Long-Term Disability (as defined in the Executive Compensation Program) is the same
as upon death, except that payment of any Deferred Base Salary will occur in accordance with the approved payment
schedule and not as soon as administratively possible following termination of employment.
•Retirement. Treatment upon an eligible Retirement (as defined in the Executive Compensation Program) is the same
as upon Long-Term Disability, except that only a pro-rata portion of a Target Incentive Opportunity installment
payment will occur based on the number of whole months worked in the performance year during which the officer
retires. No information is provided in Table 84 with respect to a termination of employment on account of a
retirement because none of the Named Executive Officers was retirement-eligible under the Executive Compensation
Program as of December 31, 2010.
•Voluntary or For Cause. The Named Executive Officers are not entitled to any termination benefits in the event of a
voluntary termination or a termination for cause and all earned but unpaid Deferred Base Salary and the unpaid
portion of any outstanding Target Incentive Opportunity awards are forfeited.
•Involuntary Termination Without Cause. The Named Executive Officers are not entitled to any termination benefits
in the event of an involuntary termination without cause unless the Compensation Committee recommends that the
Named Executive Officer receive termination benefits and the Committee’s recommendation is approved by FHFA
after consulting with Treasury, as appropriate. In determining whether to recommend payment of termination benefits
and the amount of such benefits, the Compensation Committee will take into account one or more factors that it
determines are relevant, including:
• The facts and circumstances associated with the termination;
• The performance and contributions of the Named Executive Officer during his or her tenure with us;
• The amount of earned but unpaid Deferred Base Salary as of the date of termination; and
• Our need to provide reasonable and competitive termination benefits in order to attract and retain high caliber
executives during conservatorship.
The following table describes the potential payments as of December 31, 2010 upon termination of the Named
Executive Officers employed as of that date that results from death or disability. There are no payments or benefits payable
upon termination of employment for other reasons or upon a change-in-control. Additionally, Semi-Monthly Base Salary is
only payable through the date of death or a termination resulting from disability. The amounts presented in this table do not
include vested RSU or stock option awards, vested balances in the Thrift/401(k) SERP Benefit, or vested benefits in the
Pension SERP Benefit as of December 31, 2010, because such vesting was not in connection with a termination or change-
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