Fannie Mae 2007 Annual Report Download - page 137

more detailed discussion of how continued declines in our earnings could negatively impact our regulatory
capital position.
Common Stock
Shares of common stock outstanding, net of shares held in treasury, totaled approximately 974 million and
972 million as of December 31, 2007 and 2006, respectively. We issued 2 million and 1.6 million shares of
common stock from treasury for our employee benefit plans during 2007 and 2006, respectively. We did not
issue any common stock during 2007 or 2006 other than in accordance with these plans.
From April 2005 to November 2007, we prohibited all of our employees from engaging in purchases or sales
of our securities except in limited circumstances relating to financial hardship. In May 2006, we implemented
a stock repurchase program that authorized the repurchase of up to $100 million of our shares from our non-
officer employees, who are employees below the level of vice president. In November 2007, the prohibition on
employee sales and purchases of our securities was lifted and the employee stock repurchase program was
terminated. From the implementation of the program in May 2006 through its termination in November 2007,
we purchased an aggregate of approximately 122,000 shares of common stock from our employees under the
program.
For a description of the dividends we paid on our common stock for each quarter of 2006 and 2007, our
current common stock dividend rate and the restrictions on our payment of common stock dividends, see
“Item 5—Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities.”
Preferred Stock
During 2007, we redeemed an aggregate of $1.1 billion in preferred stock and issued an aggregate of
$8.9 billion in preferred stock, as set forth below:
• On February 28, 2007, we redeemed all of the shares of our Variable Rate Non-Cumulative Preferred
Stock, Series J, with an aggregate stated value of $700 million.
• On April 2, 2007, we redeemed all of the shares of our Variable Rate Non-Cumulative Preferred Stock,
Series K, with an aggregate stated value of $400 million.
• On September 28, 2007, we issued 40 million shares of Variable Rate Non-Cumulative Preferred Stock,
Series P, with an aggregate stated value of $1.0 billion. The Series P Preferred Stock has a variable
dividend rate that will reset quarterly on each March 31, June 30, September 30 and December 31,
beginning December 31, 2007, at a per annum rate equal to the greater of (i) 3-Month LIBOR plus 0.75%
and (ii) 4.50%. The Series P Preferred Stock may be redeemed, at our option, on or after September 30,
2012.
• On October 4, 2007, we issued 15 million shares of 6.75% Non-Cumulative Preferred Stock, Series Q,
with an aggregate stated value of $375 million. The Series Q Preferred Stock may be redeemed, at our
option, on or after September 30, 2010.
• On November 21, 2007, we issued 20 million shares of 7.625% Non-Cumulative Preferred Stock, Series R,
with an aggregate stated value of $500 million. We issued an additional 1.2 million shares of Series R
Preferred Stock, with an aggregate stated value of $30 million, on December 14, 2007. The Series R
Preferred Stock may be redeemed, at our option, on or after November 21, 2012.
• On December 11, 2007, we issued 280 million shares of Fixed-to-Floating Rate Non-Cumulative
Preferred Stock, Series S, with an aggregate stated value of $7 billion. The Series S Preferred Stock has a
dividend rate of 8.25% per annum up to and excluding December 31, 2010. Beginning on December 31,
2010, the Series S Preferred Stock will have a variable dividend rate that will reset quarterly on each
March 31, June 30, September 30 and December 31, at a per annum rate equal to the greater of (i) 7.75%
and (ii) 3-Month LIBOR plus 4.23%. The Series S Preferred Stock may be redeemed, at our option, on
December 31, 2010 and on each fifth anniversary thereafter.
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