Freddie Mac 2015 Annual Report Download - page 370

Executive Compensation Compensation Discussion and Analysis
Freddie Mac 2015 Form 10-K 368
• Materially Inaccurate Information
Forfeiture Event: The NEO has earned or obtained the legally binding right to a payment of
Deferred Salary based on materially inaccurate financial statements or any other materially
inaccurate performance measure.
Compensation Subject to Recapture and/or Forfeiture: Any Deferred Salary in excess of the
amount that the Board determines would likely have been otherwise earned using accurate
measures during the two years prior to the Forfeiture Event.
• Termination for Felony Conviction or Willful Misconduct
Forfeiture Event: The NEO’s employment is terminated in any of the following circumstances:
Termination of employment because the NEO is convicted of, or pleads guilty or nolo
contendere to, a felony;
Subsequent to termination of employment, the NEO is convicted of, or pleads guilty or nolo
contendere to, a felony, based on conduct occurring prior to termination, and within one year
of such conviction or plea, the Board determines that such conduct is materially harmful to
Freddie Mac.
Termination of employment because, or within two years of termination, the Board determines
that, the NEO engaged in willful misconduct in the performance of his or her duties that was
materially harmful to Freddie Mac.
Compensation Subject to Recapture and/or Forfeiture: Any Deferred Salary earned during the two
years prior to the date that the NEO is terminated, any Deferred Salary scheduled to be paid
within two years after termination, and any cash payment made or to be made as consideration
for any release of claims agreement.
• Gross Neglect or Gross Misconduct
Forfeiture Event: The NEO’s employment is terminated because, in carrying out his or her duties,
the NEO engages in conduct that constitutes gross neglect or gross misconduct that is materially
harmful to Freddie Mac, or within two years after the NEO’s termination of employment, the Board
determines that the NEO, prior to his or her termination, engaged in such conduct.
Compensation Subject to Recapture and/or Forfeiture: Any Deferred Salary paid at the time of
termination or subsequent to the date of termination, including any cash payment made as
consideration for any release of claims agreement.
• Violation of a Post-Termination Non-Competition Covenant
Forfeiture Event: The NEO violates a post-termination non-competition covenant set forth in the
restrictive covenant and confidentiality agreement in effect when a payment of Deferred Salary is
scheduled to be made.
Compensation Subject to Recapture and/or Forfeiture: 50% of the Deferred Salary paid during
the twelve months immediately preceding the violation and 100% of any unpaid Deferred Salary.
Under the Recapture Agreement, the Board has discretion to determine the appropriate dollar amount, if
any, to be recaptured from and/or forfeited by the NEO, which is intended to be the gross amount of
compensation in excess of what Freddie Mac would have paid the NEO had Freddie Mac taken the
Forfeiture Event into consideration at the time such compensation decision was made.
A copy of the form of the Recapture Agreement was filed as Exhibit 10.3 to our Current Report on Form 8-
K filed June 12, 2013.
The following additional event is applicable only to the CEO and CFO, to the extent they have
compensation subject to reimbursement in accordance with Section 304 of the Sarbanes-Oxley Act.