Freddie Mac 2012 Annual Report Download - page 363

Former Named Executive Officer – Mr. Haldeman
Mr. Haldeman resigned his position as Chief Executive Officer effective June 30, 2012. Under the terms of the
Executive Compensation Program, he is eligible to receive the following amounts of Deferred Salary, which will be paid in
2013 on the Approved Payment Schedule:
Deferred Salary: Fixed $892,800
Deferred Salary: At-Risk (Corporate) 384,750
Deferred Salary: At-Risk (Individual) 364,500
Mr. Haldeman will not receive any other payments in connection with his termination.
Alternative Settlement Provisions for Equity Awards in the Event of Certain Terminations
Stock Options
The stock options granted to our employees, including our NEOs, all of which were exercisable as of December 31,
2012, include alternative settlement provisions in the event of certain terminations, as follows:
•Death. Stock options remain exercisable until the earlier of the original expiration date or three years after the date of
termination in the event of death.
•Disability. Stock options remain exercisable for the full balance of their term in the event of disability.
•Retirement. Stock options remain exercisable for the full balance of their term in the event of retirement.
•All Other Terminations. If the individual’s employment is terminated for any reason other than those described
above, the stock options remain exercisable until the earlier of the original expiration date or 90 days following
termination.
Employment and Separation Agreements
Messrs. Layton, Kari, and Haldeman
The various agreements entered into in connection with the employment of Messrs. Layton, Kari, and Haldeman are
summarized above. See “— Written Agreements Relating to Employment of CEO and CFO.”
Messrs. Mullings and Weiss and Ms. Wisdom
We do not have any continuing obligations under the letter agreements that were entered into with Mr. Mullings,
Mr. Weiss, and Ms. Wisdom at the time of their employment.
Director Compensation
After we entered conservatorship, FHFA approved compensation for Board members in the form of cash retainers only,
paid on a quarterly basis. Under the terms of the Purchase Agreement, without Treasury’s consent, we are prohibited from
making stock grants to directors while this agreement remains in effect. We do not maintain any pension or retirement plans
for directors. Non-employee directors are reimbursed for reasonable out-of-pocket costs for attending each meeting of the
Board or a Board committee of which they are a member and for other reasonable expenses associated with carrying out their
responsibilities as directors.
The reasons for this shift toward compensation delivered entirely in cash were similar, in the case of director
compensation, to some of those described above regarding the structural change in executive compensation (see
“Compensation Discussion and Analysis — Executive Management Compensation Program — Overview of Program
Structure”). However, the considerations underlying director and executive compensation differed in one key respect. There
is no provision in the director compensation program for pay that varies depending on business results. Although such
incentive compensation is deemed appropriate to give management strong incentives to devise and execute business plans
and achieve positive financial results, it is viewed in the case of directors as inconsistent with their oversight role.
358 Freddie Mac