exv10w25







 




    Exhibit 10.25



 


 




    FEDERAL
    HOME LOAN MORTGAGE CORPORATION



 




    DIRECTORS’
    DEFERRED COMPENSATION PLAN



 


 




    As Amended
    and Restated

    Effective April 3, 1998
    



 












 







    FEDERAL
    HOME LOAN MORTGAGE CORPORATION




    DIRECTORS’ DEFERRED COMPENSATION PLAN



 




    ARTICLE I




    Establishment of the Plan



 



    1.1  Purpose. The Federal Home Loan Mortgage
    Corporation (“Corporation”) hereby amends and restates
    the Directors’ Deferred Compensation Plan, in its entirety
    (the “Plan”) as set forth herein. The purpose of the
    Plan is to allow each Director to defer his or her cash
    compensation to a later date and, by permitting the acquisition
    of Deferred Stock under the 1995 Directors’ Stock
    Compensation Plan, to promote the purposes of that plan. The
    Corporation intends that the Plan shall be maintained at all
    times on an unfunded basis for federal income tax purposes under
    the Internal Revenue Code of 1986, as amended (or any successor
    thereto). The Plan is not covered by the Employee Retirement
    Income Security Act of 1974, as amended.



 



    1.2  Effective Date; Amendment and Restatement.
    The Plan is effective as of January 1, 1996. The Plan has
    been amended and restated effective as of April 3, 1998.



 



    1.3  Name. The name of the Plan is the Federal
    Home Loan Mortgage Corporation Directors’ Deferred
    Compensation Plan.



 




    ARTICLE II




    Definitions



 



    2.1  Account. The account established for each
    Participant pursuant to Section 4.1 hereof.



 



    2.2  Administrator. The Human Resources
    Committee of the Board.



 



    2.3  Beneficiary. The person, persons, trust,
    or trusts which have been designated by a Participant in his or
    her most recent beneficiary designation filed with the
    Administrator to receive the payments in settlement of a
    Participant’s Account upon the Participant’s death.
    If, upon a Participant’s death, there is no designated
    Beneficiary or surviving designated Beneficiary, then the term
    Beneficiary means the person, persons, trust, or trusts entitled
    by will or laws of descent and distribution to receive such
    benefits.



 



    2.4  Board. The Board of Directors of the
    Federal Home Loan Mortgage Corporation or such committee thereof
    delegated authority to act on its behalf.



 



    2.5  Cash Compensation. The retainer and
    meeting fees and any other fees payable to a













 






    Director in cash for service as a director. Cash Compensation
    excludes stock options, restricted stock, restricted stock
    units, and other non-cash awards granted to a Director, except
    insofar as the Director is entitled to receive cash compensation
    but for the Director’s election to receive non-cash awards
    in lieu of cash, and Cash Compensation excludes any
    reimbursement of expenses.



 



    2.6  Common Stock. The common stock, $0.21 par
    value, of the Corporation or such other securities as may be
    substituted therefor under the adjustment provisions of the 1995
    Plan.



 



    2.7  Corporation. The Federal Home Loan
    Mortgage Corporation.



 



    2.8  Deferral Election. An annual election to
    defer Cash Compensation, specifying the amount and portions
    thereof to be allocated to Deferred Cash or Deferred Stock under
    the Plan and setting forth other elections under the Plan. The
    Deferral Election shall be set forth on a form specified by the
    Administrator, subject to the terms of the Plan.



 



    2.9  Deferred Cash. Credits to a
    Participant’s Account in lieu of Cash Compensation
    otherwise payable to the Director, which represent rights to
    receive an equivalent amount of cash upon settlement of such
    Account, together with rights to accruals of interest and other
    rights under the Plan.



 



    2.10  Deferred Compensation. The amount of Cash
    Compensation payment of which the Director and the Corporation
    mutually agree shall be deferred in accordance with the Plan in
    the form of Deferred Cash or Deferred Stock.



 



    2.11  Deferred Stock. An award in lieu of Cash
    Compensation otherwise payable to the Director, pursuant to a
    Stock Election under Article IX of the 1995 Plan, or as a
    result of the crediting of Dividend Equivalents. Each share of
    Deferred Stock represents a generally nontransferable right to
    receive one share of Common Stock at a specified future date,
    together with a right to Dividend Equivalents and other rights,
    and subject to the terms and conditions of the 1995 Plan and the
    Plan, and any other terms and conditions imposed by the Board.
    Shares of Deferred Stock are bookkeeping units, and do not
    represent ownership of Common Stock or any other equity security.



 



    2.12  Director. A duly elected or appointed
    member of the Board who is not an employee of the Corporation.



 



    2.13  Disability. A Participant shall be
    considered disabled if he or she has a condition due to injury
    or sickness which his or her personal physician has certified to
    the Administrator prevents the Participant from performing the
    material duties of a Director.




    

    2








 






    2.14  Dividend Equivalents. Credits evidencing
    a Participant’s right to receive, in respect of each share
    of Deferred Stock, amounts equivalent to the dividends or
    distributions declared and paid on a share of Common Stock,
    which amounts are deemed to be reinvested in additional Deferred
    Stock having a Fair Market Value equal to such amounts, subject
    to Section 4.4 hereof.



 



    2.15  Fair Market Value. “Fair Market
    Value” of a share of Common Stock, as defined in the 1995
    Plan.



 



    2.16  Interest Rate. For a calendar year, the
    Prime Rate as of the first business day of such calendar year,
    plus 1%, or such other index or rate as is determined by the
    Administrator at its last meeting of the prior calendar year.



 



    2.17  1995 Plan. The Corporation’s 1995
    Directors’ Stock Compensation Plan, as amended and restated.



 



    2.18  Participant. Each Director who has
    elected to defer any portion of his or her Cash Compensation, by
    executing and delivering a Deferral Election, in accordance with
    the terms hereof, and whose Deferred Compensation has not yet
    been settled.



 



    2.19  Payment Date. The last business day of a
    specified calendar quarter.



 



    2.20  Plan Year. The twelve- (12) month
    period from January 1 to December 31.



 



    2.21  Prime Rate. The base rate on corporate
    loans at large U.S. money center commercial banks, as reported
    by  The Wall Street Journal.



 



    2.22  Stock Election. A “Stock
    Election” as defined in the 1995 Plan.



 



    2.23  Termination of Membership. The
    termination of a Director’s membership on the Board for any
    reason including resignation, retirement, removal, or expiration
    of term and failure to be reelected or reappointed, but not
    termination of membership for reason of Disability or death.




    

    3








 







    ARTICLE III




    Deferral of Cash Compensation



 



    3.1  Election to Defer Cash Compensation. Any
    Director may defer Cash Compensation under the Plan for the Plan
    Year beginning January 1, 1996, or any subsequent Plan
    Year, by executing a Deferral Election and delivering it to the
    Administrator on or before the December 31 preceding such
    Plan Year, in such form as is approved by the Administrator,
    electing to defer a set percentage or amount of Cash
    Compensation to be earned during such Plan Year, subject to the
    terms of the Plan. The foregoing notwithstanding, a
    newly-appointed or elected Director shall, with respect to the
    Plan Year in which such Director’s appointment or election
    first occurs, be entitled to make a Deferral Election in
    accordance with the rules and procedures established by the
    Administrator in order to ensure effective deferral of taxation
    and otherwise comply with applicable laws. A Director’s
    Stock Election to receive Common Stock on a non-deferred basis
    under Article IX of the 1995 Plan shall take precedence
    over a Deferral Election, so that an election to defer hereunder
    will not apply to Cash Compensation subject to such Stock
    Election. If a director has elected to defer less than 100% of
    his or her Cash Compensation under the Plan, the balance not
    deferred hereunder will be paid in accordance with the
    Corporation’s regular policies governing compensation of
    Directors.



 



    3.2  Elections as to Allocation and Settlement of
    Deferred Compensation.



 



    (a) Generally. A Deferral Election applicable to
    Plan Years commencing after December 31, 1998 shall specify
    the percentage of Deferred Compensation to be allocated to
    Deferred Cash and the percentage to be allocated to Deferred
    Stock. A Deferral Election applicable to any Plan Year shall
    specify the date or event as of which the Deferred Cash (and,
    for Plan Years commencing after December 31, 1998, Deferred
    Stock) resulting from a given Plan Year’s Deferred
    Compensation shall be settled; provided, however, that the
    period of deferral shall be a number of whole years after which
    the given Plan Year’s Deferred Compensation shall be
    settled. Settlement shall occur in any event prior to the
    scheduled settlement date (i) for deferrals applicable to
    Plan Years commencing December 31, 1998 or earlier, and
    upon the occurrence of death or Disability for deferrals
    applicable to Plan Years commencing after that date, in the form
    of a single distribution as promptly as practicable following
    the Participant’s Termination of Membership, Disability or
    death, as the case may be and (ii) for deferrals applicable
    to Plan Years commencing after December 31, 1998, in the
    case of Termination of Membership, over the course of three
    years commencing in the year following the year in which the
    Termination of Membership occurred, in the form of three equal
    annual installments.




    

    4








 






    (b) Settlement of Small Account Balances.
    Notwithstanding the terms of Section 3.2(a)(ii), in the
    event that the Administrator determines that the
    Participant’s Account has a value of $100,000 or less at
    the time Termination of Membership occurs, settlement will, upon
    Termination of Membership, take place in accordance with
    Section 3.2(a)(i), regardless of the Plan Year applicable
    to the deferrals.



 



    3.3  Effectiveness of Elections, Modification and
    Revocation. An election to defer Cash Compensation set forth
    in a Deferral Election shall become effective on the December 31
    preceding the Plan Year to which the election relates, except
    that such an election by a newly-appointed or elected Director
    shall become effective at a date specified by the Administrator.
    Once such election is effective, it may not be revoked.
    Elections as to the allocation of amounts previously credited to
    the Participant’s Account, including reallocations of
    Deferred Cash as Deferred Stock and vice versa, are not
    permitted. Elections as to the date or dates of settlement of a
    Participant’s Account may not be modified or revoked.



 



    3.4  No Deferral of Cash Compensation after
    Termination of Service as a Director. If any Cash
    Compensation otherwise subject to a Deferral Election would be
    paid to a Participant after he or she has ceased to serve as a
    Director, such payment shall not be subject to deferral under
    this Article III, but shall instead be paid in accordance
    with the Corporation’s regular policies governing
    compensation of Directors.



 




    ARTICLE IV




    Accounts



 



    4.1  Account. The Administrator shall
    establish, or cause to be established, an Account for each
    Participant hereunder.



 



    4.2  Credit of Deferred Compensation to
    Account. Each Participant’s Account shall be credited
    by bookkeeping entries with Deferred Cash and/or Deferred Stock
    resulting from the amounts of Cash Compensation deferred by the
    Participant, in accordance with the Participant’s Deferral
    Election hereunder, as of the date such amounts would have been
    paid to such Participant had no such Deferral Election been in
    force. The amount of Deferred Cash to be




    

    5








 






    credited to the Participant’s Account shall be equal to the
    dollar amount of Cash Compensation being deferred and allocated
    to Deferred Cash. The amount of Deferred Stock to be credited to
    the Participant’s Account shall be equal to the dollar
    amount of Cash Compensation being deferred and allocated to
    Deferred Stock divided by the Fair Market Value of a share of
    Common Stock at the date of crediting of the Deferred
    Compensation to the Account.



 



    4.3  Crediting of Interest on Deferred Cash. If
    a Participant’s Account has Deferred Cash credited to it,
    interest shall accrue and be credited on such Deferred Cash by
    bookkeeping entries at the Interest Rate specified in
    Section 2.16 hereof. Such interest shall accrue from the
    date as of which such Deferred Cash is credited under
    Section 4.2 hereof, compounded quarterly as of the end of
    each calendar quarter, until the earlier of the time such
    Deferred Cash and interest thereon is withdrawn in accordance
    with Section 5.2 hereof or the settlement date in
    accordance with Sections 3.2 and 5.1 hereof. Interest shall
    be credited quarterly as of the last day of the calendar quarter.



 



    4.4  Dividend Equivalents on Deferred Stock. If
    a Participant’s Account has Deferred Stock credited to it,
    Dividend Equivalents shall be credited on such Deferred Stock as
    follows:



 


			
	 	    (a)       
	
    Cash and Non-Common Stock Dividends. If the Corporation
    declares and pays a dividend or distribution on Common Stock in
    the form of cash or property other than shares of Common Stock,
    then a number of additional shares of Deferred Stock shall be
    credited to a Participant’s Account as of the payment date
    for such dividend or distribution equal to (i) the number
    of shares of Deferred Stock credited to the Account as of the
    record date for such dividend or distribution multiplied by
    (ii) the amount of cash plus the Fair Market Value of any
    property other than shares actually paid as a dividend or
    distribution on each outstanding share of Common Stock at such
    payment date, divided by (iii) the Fair Market Value of a
    share of Common Stock at such payment date.




 


			
	 	    (b)  
	
    Common Stock Dividends and Splits. If the Corporation
    declares and pays a dividend or distribution on Common Stock in
    the form of additional shares of Common Stock, or there occurs a
    forward split of Common Stock, then a number of additional
    shares of Deferred Stock shall be credited to the
    Participant’s Account as of the payment date for such
    dividend or distribution or forward split equal to (i) the
    number of shares of Deferred Stock credited to the Account as of
    the record date for such dividend or distribution or split
    multiplied by (ii) the number of additional shares of
    Common Stock actually paid as a dividend or





    

    6








 






    distribution or issued in such split in respect of each
    outstanding share of Common Stock.



 



    4.5  Adjustments to Deferred Stock. The number
    of shares of Deferred Stock credited to each Participant’s
    Account shall be appropriately adjusted, in order to prevent
    dilution or enlargement of Participants’ rights with
    respect to Deferred Stock, to reflect any changes in the number
    of outstanding shares of Common Stock resulting from any event
    referred to in Section 4.3 of the 1995 Plan, taking into
    account any Deferred Stock credited to the Participant in
    connection with such event under Section 4.4 hereof.



 



    4.6  Fractional Shares. The number of shares of
    Deferred Stock credited to a Participant’s Account shall
    include fractional shares calculated to at least three decimal
    places, unless otherwise determined by the Administrator.



 



    4.7  Statements. An individual statement of
    each Participant’s Account will be issued to each
    Participant with respect to each calendar quarter within
    30 days following the close of each quarter. Such
    statements shall reflect the amount of Deferred Cash and
    Deferred Stock credited to the Participant’s Account,
    transactions therein during the period covered by the statement,
    and other information deemed relevant by the Administrator. Such
    statement may include information regarding other plans and
    compensatory arrangements for Directors.



 




    ARTICLE V




    Settlement of Account



 



    5.1  Settlement and Distribution. A
    Participant’s Account will be settled at the time specified
    in the Participant’s Deferral Election, subject to
    Section 3.2 hereof. Distributions upon such settlement
    shall be as follows:



 



    (a)  Lump-sum Payments in Settlement of Deferred
    Cash. 



 



    (i) Settlement In Accordance with Deferral Election, or
    Upon Death or Disability. With respect to a given Plan
    Year’s Deferred Compensation, the balance of Deferred Cash
    credited to the Participant’s Account and interest thereon
    at the date of settlement shall be payable in a lump sum to the
    Participant (or in the event of the Participant’s death
    prior to payment, to the Participant’s Beneficiary) by the
    Corporation, at the direction of the Administrator, as of the
    applicable date of settlement under Section 3.2 hereof for
    such Plan Year’s Deferred Compensation. Such distribution
    shall occur within thirty (30) days after such applicable
    date of settlement, with interest credited through but not after
    such applicable settlement date.




    

    7








 






    (ii) Settlement Upon Termination of Membership. With
    respect to Deferred Compensation for a given Plan Year
    commencing after December 31, 1998, one-third of the
    balance of Deferred Cash credited to the Participant’s
    Account at the date of Termination of Membership (and interest
    thereon) shall be settled at the beginning of each Plan Year
    commencing with the year after the year in which the Termination
    of Membership occurs. Payment shall be made in three equal
    annual installments, each paid within 30 days of the
    applicable date of settlement to the Participant by the
    Corporation, at the direction of the Administrator, with
    interest credited to the balance of the Account in accordance
    with the provisions of Section 4.3 up to (but not past) the
    date of settlement. In the event that a Participant dies while
    his or her Account is being paid out in accordance with this
    Section 5.1(a)(ii), the settlement date shall be
    accelerated by the Administrator, and a single distribution
    shall be made to the Beneficiary as soon as practicable.



 



    (b) Issuance of Shares of Common Stock in Settlement of
    Deferred Stock.



 



    (i) Settlement In Accordance with Deferral Election, or
    Upon Death or Disability. With respect to a given Plan
    Year’s Deferred Compensation, the balance of Deferred Stock
    credited to the Participant’s Account (which includes
    Deferred Stock resulting, directly and indirectly, from deemed
    reinvestment of Dividend Equivalents on such Plan Year’s
    Deferred Stock) at the date of settlement shall be settled by
    delivery of one share of Common Stock for each share of Deferred
    Stock to be settled, together with cash in lieu of any
    fractional share, to the Participant, or in the event of the
    Participant’s death prior to payment, to the
    Participant’s Beneficiary, by the Corporation, at the
    direction of the Administrator, as of the applicable date of
    settlement under Section 3.2 hereof for such Plan
    Year’s Deferred Compensation. Such distribution shall occur
    within thirty (30) days after such applicable date of
    settlement, provided that, unless otherwise determined by the
    Administrator, Dividend Equivalents will be credited in cash on
    the Deferred Stock to be settled in respect of any dividend or
    distribution the record date for which occurs during such
    30-day
    period and prior to the date the Participant or his Beneficiary
    becomes a record owner of the shares of Common Stock being
    delivered in settlement of the Deferred Stock, with such cash to
    be paid together with the delivery of the shares.



 



    (ii) Settlement Upon Termination of Membership. With
    respect to a given Plan Year’s Deferred Compensation,
    one-third of the balance of Deferred Stock credited to the
    Participant’s Account (which includes Deferred Stock
    resulting, directly and indirectly, from deemed reinvestment of
    Dividend Equivalents on such Plan Year’s




    

    8








 






    Deferred Stock) at the date of Termination of Membership shall
    be settled at the beginning of each Plan Year commencing with
    the year after the year in which the Termination of Membership
    occurs. Settlement shall be made by delivery of one share of
    Common Stock for each share of Deferred Stock to be settled,
    together with cash in lieu of any fractional share, to the
    Participant, or in the event of the Participant’s death
    prior to payment, to the Participant’s Beneficiary, by the
    Corporation, at the direction of the Administrator, as of the
    applicable date of settlement under Section 3.2 hereof for
    such Plan Year’s Deferred Compensation. Such distribution
    shall occur within thirty (30) days after such applicable
    date of settlement, provided that, unless otherwise determined
    by the Administrator, Dividend Equivalents will be credited in
    cash on the Deferred Stock to be settled in respect of any
    dividend or distribution the record date for which occurs during
    such 30-day
    period and prior to the date the Participant or his Beneficiary
    becomes a record owner of the shares of Common Stock being
    delivered in settlement of the Deferred Stock, with such cash to
    be paid together with the delivery of the shares. In the event
    that a Participant dies while his or her Account is being paid
    out in accordance with this Section 5.1(b)(ii), the
    settlement date shall be accelerated by the Administrator, and a
    single distribution shall be made to the Beneficiary as soon as
    practicable.



 



    (c) Settlement of Small Account Balances Upon
    Termination. Notwithstanding the terms of
    Section 5.1(a) or (b), in the event that the Administrator
    determines that the Participant’s Account has a value of
    $100,000 or less at the time Termination of Membership occurs,
    settlement will, upon Termination of Membership, take place in
    accordance with Sections 5.1(a)(i) or 5.1(b)(i), as the
    case may be.



 



    5.2  Hardship Withdrawals.



 



    (a)  Unforeseeable Emergency. Upon written
    application to the Administrator, a Participant may request a
    withdrawal of all or any portion of the amounts of Deferred Cash
    and interest thereon or Deferred Stock then credited to his or
    her Account prior to the time of settlement applicable under
    Section 3.2 and 5.1(a) and (b) hereof in the case of
    an unforeseeable emergency. For purposes of this
    Section 5.2, an unforeseeable emergency is defined as
    severe financial hardship to the Participant resulting from a
    sudden and unexpected illness or accident of the Participant or
    of a dependent of the Participant, loss of the
    Participant’s property due to casualty, or other similar
    extraordinary and unforeseeable circumstances arising as a
    result of events beyond the control of the Participant. The
    circumstances that will constitute an unforeseeable emergency
    will depend upon the facts of each case, as determined by the
    Administrator, provided that no withdrawal may be made to the
    extent that such hardship is or may be relieved:




    

    9








 






    (i)  Through reimbursement or compensation by
    insurance or otherwise;



 



    (ii)  By liquidation of the Participant’s assets,
    to the extent the liquidation of such assets would not itself
    cause severe financial hardship; or



 



    (iii)  By cessation of deferrals under the Plan.



 



    Examples of what are not considered to be unforeseen emergencies
    include the need to send a Participant’s child to college
    or the desire to purchase a home.



 



    (b)  Amounts Withdrawn. The amount to be
    withdrawn because of an unforeseen emergency need shall not
    exceed the amount reasonably needed to satisfy such need. Upon
    the Administrator’s approval of a hardship withdrawal, the
    Administrator shall specify the withdrawal date. Cash shall be
    paid in respect of a withdrawal of Deferred Cash and interest
    thereon, and Common Stock shall be delivered in respect of a
    withdrawal of Deferred Stock on such terms, similar to those of
    Section 5.1(a) and 5.1(b) hereof, respectively, as shall be
    determined by the Administrator and communicated to the
    Participant.



 



    (c)  Administrator’s Determination. A
    Participant making a withdrawal application under this
    Section 5.2 shall be required to present to the
    Administrator evidence of such unforeseeable emergency need, and
    the Administrator shall not permit the withdrawal without first
    reviewing such evidence and making a determination as to the
    existence of the unforeseeable emergency. A Participant who is a
    member of the committee acting as Administrator shall not
    participate in, or influence in any way, the
    Administrator’s decision with respect to the
    Participant’s own application.



 



    5.3  Designation of Beneficiary.



 



    (a)  Designation. All designations of
    Beneficiary shall be on such forms as are specified by and filed
    with the Administrator. Any Beneficiary designation made by the
    Participant in accordance with this provision may be changed
    from time to time, without the consent of any previously
    designated Beneficiary (but subject to any spousal consent as
    may be required), by filing with the Administrator a notice of
    such change on the form provided by the Administrator and such
    change of Beneficiary designation shall become effective upon
    receipt by the Administrator.



 



    (b)  Absence of Beneficiary. In the event a
    Participant’s Beneficiary would otherwise become entitled
    to a distribution hereunder, and all Beneficiaries designated by
    the Participant are not then living, or if no valid Beneficiary
    designation is in effect, the Participant’s




    

    10








 






    estate or duly authorized personal representative shall be
    deemed to have been designated by the Participant.



 



    5.4  General Limitations. Neither a Participant
    nor a Beneficiary may elect to defer (or accelerate) payment of
    any distributions hereunder beyond (or before) the time of
    payment applicable under Section 3.2 and 5.1 (and
    Section 5.2) hereof.



 




    ARTICLE VI




    Administration



 



    6.1  Administration of the Plan. The Plan shall
    be administered by the Human Resources Committee, referred to
    herein as the Administrator. Members of the Human Resource
    Committee, if otherwise eligible, shall be eligible to
    participate in the Plan, but no such member shall be entitled to
    make or participate in decisions solely or primarily with
    respect to his or her participation. The Administrator shall be
    vested with full authority to make, administer and interpret
    such rules and regulations as it deems necessary to administer
    the Plan and to specify the form of agreements with or
    statements to Participants under the Plan. Any determination,
    decision or action of the Administrator in connection with the
    construction, interpretation, administration or application of
    the Plan shall be final, conclusive and binding upon all
    Participants and any and all persons claiming under or through
    any Participant. The Administrator shall have the authority to:



 


			
	 	    (i)  
	
    Employ agents to perform services on behalf of the Administrator
    and to authorize the payment of reasonable compensation for the
    performance of such services; and




 


			
	 	    (ii)  
	
    Delegate to designated employees or departments of the
    Corporation the authority to perform such of the
    Administrator’s administrative duties hereunder as may be
    delegated to such employees or departments.




 



    Pursuant to this authority and subject, in each case, to the
    right of the Administrator to revoke such delegations in writing
    at any time, the recordkeeping and bookkeeping responsibilities
    under the Plan are hereby delegated to the Senior Vice President
    of the Human Resources Department of the Corporation and/or such
    employees of that Department as the Senior Vice President shall
    designate.



 



    6.2  Cost of Administering the Plan. The
    Corporation shall pay the cost of administering the Plan.




    

    11








 






    6.3  Status as Subplan Under 1995 Plan. Insofar
    as the Plan provides for the crediting of Deferred Stock in lieu
    of Cash Compensation and the delivery of shares of Common Stock
    in settlement of Deferred Stock, the Plan constitutes a subplan
    implemented under the 1995 Plan, to be administered in
    accordance with the terms of the 1995 Plan. Accordingly, all of
    the terms and conditions of the 1995 Plan are hereby
    incorporated by reference, and, if any provision of the Program
    or an agreement relating to Deferred Stock hereunder conflicts
    with a provision of the 1995 Plan, the provision of the 1995
    Plan shall govern. Other provisions of this Article VI
    notwithstanding, any determination regarding Deferred Stock and
    the administration of the Plan relating to such Deferred Stock
    shall be subject to the terms of the 1995 Plan. Any shares
    deliverable in settlement of Deferred Stock shall be shares
    authorized for delivery under and derived from the 1995 Plan. No
    Deferred Stock may be credited to a Participant’s Account
    under the Plan at any time that the number of shares available
    under the 1995 Plan would, upon such crediting, be less than the
    number of shares deliverable in settlement of such Deferred
    Stock. In any case in which this limitation precludes the
    crediting of Deferred Stock, amounts that would have been
    credited to a Participant’s Account as Deferred Stock
    (including as a result of deemed reinvestment of Dividend
    Equivalents) shall instead be credited to such Account as
    Deferred Cash.



 




    ARTICLE VII




    Amendment and Termination



 



    7.1  Amendment. The Board may at any time amend
    the Plan; provided, however that no amendment shall reduce
    amounts already credited to a Participant’s Account at the
    time of such amendment or accelerate the settlement of an
    Account or distributions from such Account hereunder.



 



    7.2  Termination. The Corporation may at any
    time terminate the Plan provided that:



 


			
	 	    (i)  
	
    No such termination shall reduce amounts already credited to a
    Participant’s Account at such time; and




 


			
	 	    (ii)  
	
    Termination of the Plan will not accelerate the time of
    settlement under Section 5.1 hereof nor cease the accrual
    of interest or crediting of Dividend Equivalents prior to the
    applicable date or event under Section 5.1 hereof, unless
    the Corporation, by action of the Board, shall elect to settle
    all Accounts and accelerate all distributions at the time it
    elects to terminate the Plan.





    

    12








 







    ARTICLE VIII




    Miscellaneous



 



    8.1  Effect on Prior Deferred Compensation. The
    Plan amends, restates and supersedes any prior deferred
    compensation plan maintained by the Corporation for Directors.
    The foregoing notwithstanding:



 


			
	 	    (i)  
	
    The timing of payment of distributions attributable to a
    deferral election previously made with respect to compensation
    which would have been paid prior to January 1, 1996, but
    for such election, shall be controlled by such prior plan; and




 


			
	 	    (ii)  
	
    The terms of the Plan in effect prior to the effectiveness of
    the amendment and restatement of the Plan on April 3, 1998
    governed Deferred Compensation under the Plan prior to the
    effective date of such amendment and restatement.




 



    8.2  Non-Assignability. Participants may not
    borrow from their Accounts in the Plan. Neither the Participant,
    nor his Beneficiary, nor any other designee, shall have the
    right to commute, sell, assign, pledge, encumber, transfer or
    otherwise convey or dispose of the right to settlement of the
    Participant’s Account or to receive distributions
    hereunder, and all rights to settlement of such Accounts and
    distributions from such Account are expressly declared to be
    non-assignable and non-transferable. Any attempted assignment or
    transfer or other event prohibited under this Section 8.2
    shall be null and void.



 



    8.3  Prohibition Against Funding. Any provision
    for distribution in settlement of an Account hereunder shall be
    by means of bookkeeping entries on the books of the Corporation
    and shall not create in the Participant or Beneficiary any right
    to, or claim against any, specific assets of the Corporation,
    nor result in the creation of any trust or escrow account for
    the Participant or Beneficiary. A Participant or Beneficiary
    entitled to any distribution hereunder shall be a general
    creditor of the Corporation.



 



    8.4  Gender and Number. As used herein the
    masculine pronoun shall include the feminine and neuter genders,
    the singular shall include the plural, and the plural the
    singular, unless the context clearly indicates a different
    meaning.



 



    8.5  Governing Law. The validity, construction,
    and effect of the Plan, any rules and regulations under the
    Plan, and any agreement or statement hereunder will be
    determined in accordance with the Federal Home Loan Mortgage
    Corporation Act of 1970, other federal laws regulating the
    Corporation, and other laws of the United States. The Plan and
    the respective




    

    13








 






    rights and obligations of the Corporation and Participants and
    Beneficiaries, except to the extent otherwise provided by
    Federal law, shall be construed under the laws of the
    Commonwealth of Virginia (without giving effect to principles of
    conflicts of laws).



 



    8.6  Non-Forfeitable Rights. The right and
    interest of each Participant relating to his or her Deferral
    Account shall be at all times non-forfeitable.



 



    8.7  Continued Service as an Employee. If a
    Participant ceases serving as a Director and, immediately
    thereafter, is employed by the Corporation or any affiliate,
    then, solely for purposes of Article V of the Plan, such
    Participant will not be deemed to have ceased service as a
    Director at that time, and his or her continued employment by
    the Corporation or any subsidiary will be deemed to be continued
    service as a Director; provided, however, that such former
    Director will not be eligible to defer compensation under the
    Plan payable for services performed thereafter.



 



    8.8  Investment Risk. A Participant and his or
    her Beneficiary shall assume all risk in connection with any
    decrease in value of Deferred Stock, and neither the
    Corporation, the Board, nor the Administrator shall be liable or
    responsible therefor.



 



    8.9  Severability. The invalidity or
    unenforceability of any provision of the Plan shall not affect
    the other provisions, and the Plan shall be construed in all
    respects as if any invalid or unenforceable provisions were
    omitted.



 



    IN WITNESS WHEREOF, the Corporation has caused this
    DIRECTORS’ DEFERRED COMPENSATION PLAN, as amended and
    restated, to be executed by its duly authorized officers, this
    23rd
    day of April, 1998.



 


	 	 	 
	
 
	
 
	
    FEDERAL HOME LOAN

    MORTGAGE CORPORATION

	
 
	
 
	
 

	
 
	
 
	

    By:  /s/  Leland
    Brendsel


    
Leland
    Brendsel

    Chairman & Chief Executive Officer




	
    ATTEST:
	
 
	
 

	
    /s/  Mollie
    Roy


    Assistant
    Secretary
	
 
	
 










    

    14








 





 




    TABLE
    OF CONTENTS



 


	 	 	 
	
 
	
 
	

    Page



	 

	

    ARTICLE I — Establishment of the Plan


	
 
	
    1

	

    ARTICLE II — Definitions


	
 
	
    1

	

    ARTICLE III — Deferral of Cash Compensation


	
 
	
    4

	

    ARTICLE IV — Accounts


	
 
	
    5

	

    ARTICLE V — Settlement of Account


	
 
	
    7

	

    ARTICLE VI — Administration


	
 
	
    11

	

    ARTICLE VII — Amendment and Termination


	
 
	
    12

	

    ARTICLE VIII — Miscellaneous


	
 
	
    13