Freddie Mac 2014 Annual Report Download - page 264

259 Freddie Mac
We entered into letter agreements with each of our NEOs in connection with their hiring. Although the letter agreements
set forth specific initial levels of Base Salary and, where applicable, Target TDC, the compensation of each NEO is subject to
change by FHFA and, other than in the case of Mr. Layton, to the terms of the 2014 EMCP.
We also entered into restrictive covenant and confidentiality agreements with each of our NEOs in connection with their
hiring. The non-competition and non-solicitation provisions included in the restrictive covenant and confidentiality agreements
are described in “Potential Payments Upon Termination of Employment or Change-in-Control.”
2014 EMCP participants are not currently entitled to a guaranteed level of severance benefits upon any type of
termination event. For additional information on compensation and benefits payable in the event of a termination of
employment, see “Potential Payments Upon Termination of Employment or Change-in-Control.”
Mr. Layton
We entered into: (a) a letter agreement; and (b) a restrictive covenant and confidentiality agreement with Mr. Layton in
connection with his employment as our Chief Executive Officer. The terms of Mr. Layton’s letter agreement provide him with
an annual Base Salary of $600,000 and the opportunity to participate in all employee benefit plans offered to Freddie Mac’s
senior executive officers pursuant to the terms of these plans. Copies of Mr. Layton's letter agreement and restrictive covenant
and confidentiality agreement were filed as Exhibits 10.1 and 10.2, respectively, to our Current Report on Form 8-K filed on
May 10, 2012.
Mr. Mackey
We entered into: (a) a letter agreement; and (b) a restrictive covenant and confidentiality agreement with Mr. Mackey in
connection with his employment as our CFO. The terms of Mr. Mackey’s letter agreement provide him with an annual Target
TDC opportunity of $3,000,000, consisting of Base Salary of $500,000 and Deferred Salary of $2,500,000; and the opportunity
to participate in all employee benefit plans offered to Freddie Mac’s senior executive officers pursuant to the terms of these
plans.
Mr. Mackey's letter agreement also provided for a cash sign-on award of $960,000 in recognition of the forfeited
compensation at his prior employer and commuting expenses during the first several months of his employment. This award
was paid in installments during Mr. Mackey’s first year of employment with us, as follows: (i) first installment: $510,000 on
the same date on which Mr. Mackey received his first payment of Base Salary; (ii) second installment: $225,000 on the six-
month anniversary of his hire date; and (iii) third installment: $225,000 on the one-year anniversary of his hire date. Each
installment is subject to repayment in the event that, prior to the first anniversary of an installment payment date, Mr. Mackey
terminates his employment with Freddie Mac for any reason or Freddie Mac terminates his employment due to the occurrence
of any of the Forfeiture Events described in his Recapture and Forfeiture Agreement. Copies of Mr. Mackey's letter agreement
and restrictive covenant and confidentiality agreement were filed as Exhibits 10.1 and 10.2, respectively, to our Current Report
on Form 8-K filed on September 30, 2013.
Mr. Lowman
We entered into: (a) a letter agreement; and (b) a restrictive covenant and confidentiality agreement with Mr. Lowman in
connection with his employment as our Executive Vice President - Single-Family Business. The terms of Mr. Lowman’s letter
agreement provide him with an annual Target TDC opportunity of $3,000,000, consisting of Base Salary of $500,000 and
Deferred Salary of $2,500,000; and the opportunity to participate in all employee benefit plans offered to Freddie Mac’s senior
executive officers pursuant to the terms of these plans. Copies of Mr. Lowman's letter agreement and restrictive covenant and
confidentiality agreement are filed as Exhibits 10.48 and 10.49, respectively, to our Annual Report on Form 10-K filed on
February 27, 2014.
Mr. McDavid
We entered into: (a) a letter agreement; and (b) a restrictive covenant and confidentiality agreement with Mr. McDavid in
connection with his employment as our Executive Vice President - General Counsel and Corporate Secretary. The terms of Mr.
McDavid’s letter agreement provide him with an annual Target TDC opportunity of $2,600,000, which consists of Base Salary
of $500,000 and Deferred Salary of $2,100,000; and the opportunity to participate in all employee benefit plans offered to
Freddie Mac’s senior executive officers pursuant to the terms of these plans. Copies of Mr. McDavid's letter agreement and
restrictive covenant and confidentiality agreement were filed as Exhibits 10.1 and 10.2, respectively, to our Current Report on
Form 8-K filed on July 9, 2012.
Mr. Weiss
We do not have any continuing obligations under the letter agreement that we entered into with Mr. Weiss at the time of
his employment. Mr. Weiss' restrictive covenant and confidentiality agreement was filed as Exhibit 10.49 to our Annual Report
on Form 10-K filed on March 9, 2012.
Recapture and Forfeiture Agreement
Freddie Mac has adopted, with the approval of FHFA, the Recapture and Forfeiture Agreement (the “Recapture
Agreement”). In order to participate in the 2014 EMCP, each of our NEOs other than Mr. Layton has entered into a Recapture
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