Fannie Mae 2007 Annual Report Download - page 65

Second Quarter 2007
Information about sales and issuances of our unregistered securities during the quarter ended June 30, 2007
was provided in a current report on Form 8-K filed with the SEC on August 9, 2007.
Third Quarter 2007
Information about sales and issuances of our unregistered securities during the quarter ended September 30,
2007 was provided in our quarterly report on Form 10-Q for the quarter ended September 30, 2007, filed with
the SEC on November 9, 2007.
Fourth Quarter 2007
Under the Fannie Mae Stock Compensation Plan of 1993 and the Fannie Mae Stock Compensation Plan of
2003 (the “Plans”), we regularly provide stock compensation to employees and members of the Board of
Directors to attract, motivate and retain these individuals and promote an identity of interests with
shareholders.
During the quarter ended December 31, 2007, we issued 299,556 shares of common stock upon the exercise of
stock options for an aggregate exercise price of approximately $15.5 million, of which approximately
$5.9 million was paid in cash and the remainder was paid by the delivery to us of 151,885 shares of common
stock. Options granted under the Plans typically vest 25% per year beginning on the first anniversary of the
date of grant and expire ten years after the grant. No options have been granted since May 2005.
On June 15, 2007, our Board of Directors determined that a portion of contingent shares under our
Performance Share Program would be awarded. Accordingly, during the quarter ended December 31, 2007, we
awarded 161,109 shares of common stock, as a result of which 94,019 shares of common stock were issued
and 67,090 shares of common stock that otherwise would have been issued were withheld by us in lieu of
requiring the recipients to pay us the withholding taxes due upon awarding.
In consideration of services rendered or to be rendered, we also issued 15,800 shares of restricted stock during
the quarter ended December 31, 2007. In addition, 18,533 restricted stock units vested, as a result of which
12,676 shares of common stock were issued and 5,857 shares of common stock that otherwise would have
been issued were withheld by us in lieu of requiring the recipients to pay us the withholding taxes due upon
vesting. Shares of restricted stock and restricted stock units granted under the Plans typically vest in equal
annual installments over three or four years beginning on the first anniversary of the date of grant. Each
restricted stock unit represents the right to receive a share of common stock at the time of vesting. As a result,
restricted stock units are generally similar to restricted stock, except that restricted stock units do not confer
voting rights on their holders.
All options, shares of restricted stock and restricted stock units were granted to persons who were employees
or members of the Board of Directors of Fannie Mae.
As reported in a current report on Form 8-K filed with the SEC on November 21, 2007, we issued 20 million
shares of 7.625% Rate Non-Cumulative Preferred Stock, Series R, with an aggregate stated value of
$500 million, on November 21, 2007. As reported in a current report on Form 8-K filed with the SEC on
December 20, 2007, 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.
As reported in a current report on Form 8-K filed with the SEC 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, on December 11, 2007.
The securities we issue are “exempted securities” under laws administered by the SEC to the same extent as
securities that are obligations of, or are guaranteed as to principal and interest by, the United States. As a
result, we do not file registration statements with the SEC with respect to offerings of our securities.
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