##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 Form 10-K/A
 (Amendment No. 1)
 (Mark One)
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number: 1-8422
 
 Countrywide Financial Corporation
  Delaware
(State or Other Jurisdiction of 
Incorporation or Organization)
    
    13-2641992
(I.R.S. Employer
Identification No.)4500 Park Granada, Calabasas, CA
(Address of principal executive offices)
    
    91302
(Zip Code)
 (818) 225-3000
  Title of Each Class
    
    Name of Each Exchange on Which RegisteredCommon Stock, $0.05 Par Value
    
    New York Stock ExchangePreferred Stock Purchase Rights
    
    New York Stock Exchange
  None
 þ o
 o þ
 þ o
 o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



Countrywide Financial Corporation
 Amendment
No. 1 to
 2007 Annual Report on Form 10-K/A
 Table of Contents
 PagePART IIIItem 10.
    
    Directors, Executive Officers and Corporate Governance
    
    
    1Directors
    
    
    1Executive Officers
    
    
    3Section 16(a) Beneficial Ownership Reporting Compliance
    
    
    4Governance
    
    
    5Item 11.
    
    Executive Compensation
    
    
    6Compensation Discussion and Analysis
    
    
    6Compensation Committee Report
    
    
    23Compensation Committee Interlocks and Insider Participation
    
    
    23Summary Compensation Table
    
    
    24Grants of Plan-Based Awards
    
    
    29Outstanding Equity Awards at Fiscal Year-End
    
    
    32Options Exercises and Stock Vested
    
    
    34Pension Benefits
    
    
    35Nonqualified Deferred Compensation
    
    
    38Potential Payments Upon Termination or Change-in-Control
    
    
    41Director Compensation and Benefits
    
    
    52Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    
    56Security Ownership of Certain Beneficial Owners
    
    
    56Security Ownership of Directors and Executive Officers
    
    
    58Change in Control Transactions
    
    
    59Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    60Certain Relationships and Transactions
    
    
    60Item 14.
    
    Principal Accountant Fees and Services
    
    
    63Auditor Fees and Services
    
    
    63Incorporation by Reference
    
    
    64Disclaimer
    
    
    64Exhibit 31.1Exhibit 31.2
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ii




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##### Table of Contents



Item 10.     Directors, Executive Officers and Corporate Governance
 
 DIRECTORS
  DirectorsTerm Expiring 2008 (Class III)
 Angelo R. Mozilo
    
    Age 69, Director since 1969. Mr. Mozilo is the Chairman
of the Board and Chief Executive Officer of the Company.
Mr. Mozilo is a co-founder of the Company and has been
Chairman of the Board of the Company since March 1999
and Chief Executive Officer of the Company since
February 1998. Prior to his present position, he was
President of the Company from March 2000 through
December 2003 and served in other executive capacities
since the Companys formation in March 1969. Mr. Mozilo
was the 1991-1992 President of the Mortgage Bankers
Association of America and also served on its board of
directors. He currently serves on the board of directors
of the Harvard Kennedy School Joint Center for Housing
Studies. He is also a member of the boards of trustees
of the National Housing Endowment, Fordham University
and Gonzaga University.Oscar P. Robertson
    
    Age 69, Director since 2000. Mr. Robertson is the
President and Chief Executive Officer of Oscar
Robertson Solutions L.L.C., a holding company, and
Orchem Corporation, a manufacturer of specialty
chemicals. He is also President and Chief Executive
Officer of OR Document Management Services, LLC, a
document management provider, and a member and manager
of OR Food Force, LLC. Mr. Robertson is also General
Partner of Oscar Robertson Media Ventures, a media
publications firm. Mr. Robertson currently serves on
the board of trustees of the Lupus Foundation of
America, he is an honorary spokesperson for the
National Kidney Foundation and he serves on the board
of directors of Countrywide Bank, FSB. From 1960 to
1974, Mr. Robertson was a professional basketball
player, and he was inducted into the National
Basketball Hall of Fame in 1979.Keith P. Russell
    
    Age 62, Director since 2003. Mr. Russell has been the
President and Chief Executive Officer of Russell
Financial, Inc., a strategic and financial consulting
firm, since 2001. From 1996 to 2001, he was Chairman of
Mellon West where he established, expanded and oversaw
Mellons West Coast operations and, from 1991 to 1996,
he was Vice-Chairman and Chief Risk Officer of Mellon
Financial Corporation. Prior to these positions, Mr.
Russell served as President and Chief Operating Officer
of Glendale Federal Bank. Mr. Russell currently serves
on the boards of directors of Countrywide Bank, FSB,
Nationwide Health Properties and Sunstone Hotel
Investors, Inc. He also currently serves on the advisory
board of Forrest Binkley and Brown Capital Partners, a
venture capital firm, and is a member of the board of
visitors of the UCLA Anderson School of Management.David Sambol
    
    Age 48, Director since 2007. Mr. Sambol is the President and
Chief Operating Officer of the Company. He also serves as
Chairman of the Board and Chief Executive Officer of
Countrywide Home Loans, Inc. and Chief Executive Officer and
President of Countrywide Bank, FSB. Mr. Sambol has served in
a number of other executive positions with the Company,
including most recently as Executive Managing Director,
Business Segment Operations, and as Executive Managing
Director and Chief of Mortgage Banking and Capital Markets.
Prior to joining the Company in 1985, Mr. Sambol served as a
Certified Public Accountant with the accounting firm of Ernst
& Whinney.
 1




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DirectorsTerm Expiring 2009 (Class I)
 Jeffrey M.
Cunningham
    
    Age 55, Director since 1998. Mr. Cunningham is the
Chairman and Chief Executive Officer of NewsMarkets
LLC, publishers of Directorship Magazine. He is
also founder and Chairman of New England Ventures,
LLC, an advisory and investment firm with interests
in media and technology. Previously he served as
Managing Director of Schroders International
Finance Fund; president of CMGI, Inc., an Internet
incubator; publisher of Forbes Magazine; and head
of sales and marketing at Business Week Magazine.
He currently serves as non-executive Chairman of
the Board of Sapient Corporation and TheStreet.com,
Inc. and serves on the board of directors of
Countrywide Bank, FSB. He formerly served on the
boards of directors of Data General, Pagenet,
Schindler Holdings and Premiere Group, Inc.Martin R. Melone
    
    Age 66, Director since 2003. Mr. Melone is a retired
Partner of Ernst & Young LLP, effective June 2003, where
he was responsible for global clients in a wide range of
industries. He became a partner of that firm in 1975.
Mr. Melone previously was a director of Parsons E&C
Corporation. He currently serves on the boards of
directors of Countrywide Bank, FSB, Internet Brands,
Inc., an operator of media and e-commerce sites, and the
Public Counsel Law Center and serves as a trustee of the
California Science Center Foundation. Mr. Melone is also
a member of the American Institute of Certified Public
Accountants and the California Society of Certified
Public Accountants.Robert T. Parry
    
    Age 68, Director since 2004. Mr. Parry is the retired
President and Chief Executive Officer, effective May
2004, of the Federal Reserve Bank of San Francisco. He
had served in such capacity since February 1986. Mr.
Parry previously was a director and member of the
Executive Committee of the San Francisco Bay Area Council
of the Boy Scouts of America. He currently serves on the
boards of directors of Janus Capital Group, Inc., PACCAR,
Inc., a truck manufacturing and distribution company, the
National Bureau of Economic Research and Countrywide
Bank, FSB.
 DirectorsTerm Expiring 2010 (Class II)
 Robert J. Donato
    
    Age 68, Director since 1993. Mr. Donato has been the
President of Donato Financial Services since December
2004. From October 1997 to November 2004, Mr. Donato was
employed as the Executive Vice President, Los Angeles
Branch, of UBS Financial Services, Inc. and from January
1997 through September 1997, he was the President of
Freedom Advisors, Inc., an investment advisor company.
Prior thereto, Mr. Donato held the position of Executive
Vice President, Director of Regional Institutional Sales
for PaineWebber, Incorporated. Mr. Donato previously
served on the boards of directors of Countrywide
Mortgage Investments, Inc. (now IndyMac Bancorp, Inc.),
Paine Webber Development Corp. and the Juvenile Diabetes
Research Foundation. He is an honorary member of the
board of visitors of the Graziadio Graduate School of
Business and Management at Pepperdine University and
currently serves on the board of directors of
Countrywide Bank, FSB.Harley W. Snyder
    
    Age 75, Director since 1991. Mr. Snyder has been the
President of HSC, Inc., a real estate development
company, since 1972, and President of The S-W
Corporation, a land development company, since 1978. Mr.
Snyder, a consultant and private investor in real
estate, is also currently a managing member of Parke &
Associates LLC, a real estate development company, a
managing partner of Reason Bell Properties, LLC, a
commercial property
 2




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management company, and a managing
member of South Coast, LLC, a real estate development
company. From April 1997 to February 2000, he served as
Senior Vice President, Real Estate, of Whiteco
Industries, Inc., a company engaged in outdoor
advertising, family entertainment, hotels and
restaurants, land development and construction. Mr.
Snyder previously served on the boards of directors of
Countrywide Mortgage Investments, Inc. (now IndyMac
Bancorp, Inc.) and Porter County Community Foundation.
Mr. Snyder was President of the National Association of
Realtors in 1983 and has served as a director of that
organization since 1972. He currently serves on the
boards of directors of Countrywide Bank, FSB and the
Northwestern Indiana Regional Development Authority and
serves on the board of trustees of Valparaiso
University.
 
 EXECUTIVE OFFICERS
  EmployedName
    
    Age
    
    Office
    
    SinceAngelo R. Mozilo
    
    
    69
    
    
    Chairman of the Board and Chief Executive Officer
    
    
    1969David Sambol
    
    
    48
    
    
    President and Chief Operating Officer
    
    
    1985Kevin W. Bartlett
    
    
    50
    
    
    Executive Managing Director, Chief Investment Officer
 Investments and Market Risk Management
    
    
    1984Carlos M. Garcia
    
    
    52
    
    
    Executive Managing Director, Enterprise Risk
Management and Governance
    
    
    1984Andrew Gissinger III
    
    
    48
    
    
    Executive Managing Director, Residential Lending and
Insurance
    
    
    1995Ranjit M. Kripalani
    
    
    48
    
    
    Executive Managing Director, Capital Markets
    
    
    1998Sandor E. Samuels
    
    
    55
    
    
    Executive Managing Director, Chief Legal Officer
    
    
    1990Jack W. Schakett
    
    
    56
    
    
    Executive Managing Director, Chief Operations Officer
    
    
    1998Eric P. Sieracki
    
    
    51
    
    
    Executive Managing Director and Chief Financial Officer
    
    
    1988Robert V. James
    
    
    53
    
    
    Senior Managing Director, President and Chief
Executive Officer, Countrywide Insurance Group
    
    
    2004Anne D. McCallion
    
    
    53
    
    
    Senior Managing Director and Deputy Chief Financial Officer
    
    
    1991Laura K. Milleman
    
    
    47
    
    
    Senior Managing Director, Chief Accounting Officer
    
    
    1989
 Angelo R. Mozilo
 David Sambol
 Kevin W. Bartlett
 3




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Carlos M. Garcia
 Andrew Gissinger III
 Ranjit M. Kripalani
 Sandor E. Samuels
 Jack W. Schakett
 Eric P. Sieracki
 Robert V. James
 Anne D. McCallion
 Laura K. Milleman
 
 SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 www.countrywide.com
   4




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GOVERNANCE
 Code of Business Ethics
 www.countrywide.com
 Board Committees and Charters
  www.countrywide.com
 Audit and Ethics Committee
   5




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Item 11.     Executive Compensation
 
 COMPENSATION DISCUSSION AND ANALYSIS
 Executive Summary
  
    
    Implemented Mr. Mozilos new employment agreement, which targeted his total
compensation at approximately the 75th
percentile of compensation for similar executives in our peer group  reducing his base salary, target bonus, maximum
bonus, and annual long term incentive award; Mr. Mozilo also received a special
award of restricted stock units (RSUs) in consideration for postponing
his planned retirement
    
    Entered into an employment agreement with Mr. Sambol, which increased his base
salary and awarded him a one-time promotion bonus of $2.6 million in connection with
his promotion to President and Chief Operating Officer
    
    Changed the mix of our annual equity award from 100% time-vested stock
appreciation rights (SARs) to 50% time-vested SARs and 50% performance-based RSUs to
further emphasize our objective of paying for performance and aligning pay with our
stockholders interests
  
    
    None of the named executive officers received a cash bonus under our Annual
Incentive Plan for 2007 because performance fell below threshold targets
    
    The portion of the April 2007 annual equity award (granted in RSUs) that was scheduled
to vest in the first quarter of 2008 was forfeited because performance fell below
threshold targets
    
    Total direct compensation in 2007 was below target levels for all of the named
executive officers
  6




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
    
    A special grant of cash-settled RSUs that are to vest over three years
    
    A cash retention payment that was paid on March 14, 2008
  Oversight and Authority over Executive Compensation
 The Compensation Committee
  Role of Management in Establishing Compensation
 Consultant to the Compensation Committee ,
 Consultant to Management
 7




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##### Table of Contents



Objectives, Components and Review of Executive Compensation
  
    
    Attracting and retaining the highest level of executive talent through payment of
competitive compensation
    
    Paying for performance
    
    Aligning our compensation programs with the interests of our stockholders
   
    
    Base salary
    
    Annual incentive awards and other bonuses
    
    Equity awards
    
    Benefits and perquisites
    
    Post-employment compensation and benefits
  Evaluating Competitiveness of Our Compensation Programs
     8




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2007 Peer Group
 
    
    American Express Company
    
    The Bank of New York Mellon Corporation
    
    Capital One Financial Corp.
    
    Keycorp
    
    Lehman Brothers Holdings, Inc.
    
    Merrill Lynch & Co, Inc.
    
    National City Corporation
    
    The PNC Financial Services Group, Inc.
    
    SLM Corporation
    
    SunTrust Banks, Inc.
    
    U.S. Bancorp
    
    Wachovia Corporation
    
    Washington Mutual, Inc.
    
    Wells Fargo & Company
  Summary of 2007 Compensation Actions
  Employment Agreements with Messrs. Mozilo and Sambol
  Employment Agreement with Mr. Mozilo
    2006 (actual) -
    
    
    
    
    
    2006 (actual) -2007 (target) %
    
    
    
    
    
    2007 (actual) %Components
    
    2006 (actual)
    
    2007 (target)
    
    Change
    
    2007 (actual)
    
    ChangeBase Salary
    
    $
    2,900,000
    1
    
    $
    1,900,000
    
    
    
    -34
    %
    
    $
    1,900,000
    
    
    
    -34
    %Annual Incentive
    
    $
    20,461,473
    
    
    $
    4,000,000
    
    
    
    -80
    %
    
    $
    0
    
    
    
    -100
    %Equity Awards
    
    $
    19,012,000
    
    
    $
    10,000,000
    
    
    
    -47
    %
    
    $
    10,000,036
    2
    
    
    -47
    %Total Direct
Compensation
    
    $
    42,373,473
    
    
    $
    15,900,000
    
    
    
    -62
    %
    
    $
    11,900,036
    
    
    
    -72
    %
 9




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##### Table of Contents



1
    
    Reflects Mr. Mozilos annualized base salary for 2006.2
    
    Reflects the annual equity award set by the terms of Mr. Mozilos employment agreement
and does not include the one-time $10 million employment term extension award of RSUs that Mr. Mozilo
received during 2007. 2007 Base Salary.
 2007 Annual Incentive Award.
 If Companys ROE is
    
    Mr. Mozilos Share Rate on Net Income Above ROE Target equals<10%
    
    0.00% of Net Income10%-12%
    
    0.44% of Net Income over 10% ROE>12%
    
    0.44% of Net Income between 10% and 12% ROEplus 0.64% of Net Income over 12% ROE
  2007 Annual Equity Award.
 2007 Special Term Extension Award. th
 Employment Agreement with Mr. Sambol
  10




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th th th
  2006 (actual) -
    
    
    
    
    
    2006 (actual) -2006
    
    2007
    
    2007 (target) %
    
    2007
    
    2007 (actual) %Components
    
    (actual)
    
    (target)
    
    Change
    
    (actual)
    
    ChangeBase Salary
    
    $
    1,200,000
    1
    
    $
    1,400,000
    
    
    
    17
    %
    
    $
    1,400,000
    
    
    
    17
    %Annual Incentive
    
    $
    5,250,000
    
    
    $
    3,870,000
    
    
    
    -26
    %
    
    $
    2,625,000
    2
    
    
    -50
    %Equity Awards
    
    $
    7,705,970
    
    
    $
    9,000,000
    
    
    
    17
    %
    
    $
    9,000,023
    
    
    
    17
    %Total Direct
Compensation
    
    $
    14,155,970
    
    
    $
    14,270,000
    
    
    
    1
    %
    
    $
    13,025,023
    
    
    
    -8
    %
 
 1
    
    Reflects Mr. Sambols annualized base salary for 2006.2
    
    Reflects a special cash bonus of $2.6 million paid in connection with the execution of Mr. Sambols
new employment agreement; Mr. Sambol did not earn an annual incentive award for Fiscal 2007.  2007 Base Salary.
 2007 Annual Incentive Award. th
 If Companys ROE is
    
    Mr. Sambols Share Rate on Net Income Above ROE Target equals<10%
    
    0.00% of Net Income10%-12%
    
    0.275% of Net Income over 10% ROE>12%
    
    0.275% of Net Income between 10% and 12% ROE plus0.40% of Net Income over 12% ROE
  2007 Annual Equity Award.
 Special Cash Bonus.
 11




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##### Table of Contents



Other Named Executive Officers
 th th
  Eric P. Sieracki
 2006 (actual) -
    
    
    
    
    
    2006 (actual) -2007 (target) %
    
    
    
    
    
    2007 (actual) %Components
    
    2006 (actual)
    
    2007 (target)
    
    Change
    
    2007 (actual)
    
    ChangeBase Salary
    
    $
    700,000
    1
    
    $
    726,250
    
    
    
    4
    %
    
    $
    726,250
    1
    
    
    4
    %Annual Incentive
    
    $
    856,350
    
    
    $
    1,500,000
    
    
    
    75
    %
    
    $
    0
    
    
    
    -100
    %Equity Awards
    
    $
    1,580,903
    
    
    $
    2,000,000
    
    
    
    27
    %
    
    $
    2,750,138
    2
    
    
    74
    %Total Direct
Compensation
    
    $
    3,137,253
    
    
    $
    4,226,250
    
    
    
    35
    %
    
    $
    3,476,388
    
    
    
    11
    %
 
 1
    
    Reflects Mr. Sierackis annualized base salary for 2006 and 2007, as applicable.2
    
    Includes a special performance-based RSU award of $750,000 as described in the section
2007 Special Awards on page 15. Carlos M. Garcia
 2006 (actual) -
    
    
    
    
    
    2006 (actual) -2007 (target) %
    
    
    
    
    
    2007 (actual) %Components
    
    2006 (actual)
    
    2007 (target)
    
    Change
    
    2007 (actual)
    
    ChangeBase Salary
    
    $
    900,000
    1
    
    $
    933,750
    
    
    
    4
    %
    
    $
    933,750
    1
    
    
    4
    %Annual Incentive
    
    $
    2,696,378
    
    
    $
    2,900,000
    
    
    
    8
    %
    
    $
    0
    
    
    
    -100
    %Equity Awards
    
    $
    1,580,903
    
    
    $
    2,000,000
    
    
    
    27
    %
    
    $
    2,000,130
    
    
    
    27
    %Total Direct
Compensation
    
    $
    5,177,281
    
    
    $
    5,833,750
    
    
    
    13
    %
    
    $
    2,933,880
    
    
    
    -43
    %
 
 1
    
    Reflects Mr. Garcias annualized base salary for 2006 and 2007, as applicable. 12




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Andrew Gissinger III
 2006 (actual) -
    
    
    
    
    
    2006 (actual) -2007 (target) %
    
    
    
    
    
    2007 (actual) %Components
    
    2006 (actual)
    
    2007 (target)
    
    Change
    
    2007 (actual)
    
    ChangeBase Salary
    
    $
    650,000
    1
    
    $
    750,000
    
    
    
    15
    %
    
    $
    750,000
    1
    
    
    15
    %Annual Incentive
    
    $
    2,066,843
    
    
    $
    2,500,000
    
    
    
    21
    %
    
    $
    0
    
    
    
    -100
    %Equity Awards
    
    $
    1,185,677
    
    
    $
    2,000,000
    
    
    
    69
    %
    
    $
    4,149,406
    2
    
    
    250
    %Total Direct
Compensation
    
    $
    3,902,520
    
    
    $
    5,250,000
    
    
    
    35
    %
    
    $
    4,899,406
    
    
    
    26
    %
 
 1
    
    Reflects Mr. Gissingers annualized base salary for 2006 and 2007, as applicable.2
    
    Includes $2,149,276 in cash-settled RSUs granted to Mr. Gissinger on November 1, 2007
as part of our retention program. See section Retention Program on page
18.   2007 Base Salary
  2007 Annual Incentive Awards
  
    
    At least at threshold levels: More likely than not to occur,
but not certain;
    
    At target levels: Challenging, yet achievable; and
 13




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##### Table of Contents




    
    Above target levels: Unlikely, but not impossible.
 Threshold
    
    Target
    
    Maximum
    
    Actual2007 EPS
    
    $
    3.30
    
    
    $
    4.30
    
    
    $
    5.30
    
    
    
    -$2.032007 Payout as a %
of Target
    
    
    30
    %
    
    
    100
    %
    
    
    200
    %
    
    
    0
    %2006 EPS
    
    $
    3.80
    
    
    $
    4.30
    
    
    $
    4.80
    1
    
    $
    4.302006 Payout as a %
of Target
    
    
    65
    %
    
    
    100
    %
    
    
    200%
    1
    
    
    100
    %
 
 1
    
    For Mr. Gissinger in 2006, the maximum EPS payout as a percent of
target was 150%. For Mr. Garcia in 2006, the maximum EPS target was $4.55
and the maximum payout as a percent of target was 150%.    Name
    
    Threshold
    
    Target
    
    Maximum
    
    ActualEric P. Sieracki
    
    $
    360,000
    
    
    $
    1,500,000
    
    
    $
    3,000,000
    
    
    $
    0Carlos M. Garcia
    
    $
    696,000
    
    
    $
    2,900,000
    
    
    $
    5,800,000
    
    
    $
    0Andrew Gissinger III
    
    $
    600,000
    
    
    $
    2,500,000
    
    
    $
    5,000,000
    
    
    $
    0
 2007 Annual Equity Awards.
  14




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th th
  2007 Special Awards
  Benefits and Perquisites
   15




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Perquisite
    
    Description
    
    Status
    

Named
Executive
 Officer ParticipationAuto Program
    
    Leased auto or
allowance provided
and includes
maintenance and
licensing fees
    
    Closed to new
participants
effective September
2006
    
    All named executive officersExecutive Country Club 
Membership
    
    Payment of
initiation fees and
monthly club dues
    
    Closed to new
participants
effective September
2006
    
    Messrs. Mozilo, Sambol,
Sieracki and GissingerExecutive Physical Program
    
    Company-paid
comprehensive
physical
examination
    
    Active
    
    All named executive officersExecutive Financial 
Planning Program
    
    Personal financial
planning services,
including tax
preparation
    
    Active
    
    All named executive officersPersonal Use of Corporate
Aircraft
    
    Use of Company
aircraft for
personal use
    
    Active only for CEO
and President & COO
in accordance with
Company security
policy
    
    Messrs. Mozilo and Sambol
are required to use private
aircraft for all travel
pursuant to Company
security policy, whether
business or personalPermission required
for all other officers
    
    Permission required for all
other officersSupplemental Disability
    
    Provides coverage
in excess of
benefits provided
under the Companys
group long term
disability plan
    
    Active
    
    Messrs. Sambol, Sieracki, Garcia
and GissingerExecutive Life
    
    Provides coverage
in excess of the
Companys basic
life insurance
coverage
    
    Active
    
    Messrs. Sambol,
Sieracki, Garcia and Gissinger
 Post-Employment Compensation and Benefits
 Retirement Benefits
  Named ExecutiveBenefit Program
    
    Eligibility
    
    Benefit
    
    Rationale
    

Officer
ParticipationExecutive 
Contribution 
Account Plan
    
    Select executives
who do not
participate in the
Companys
Supplemental
Executive
Retirement Plan
(SERP)
    
    Annual Company
contribution of
1-5% of eligible
compensation
    
    Additional source
of post-employment
income. Replacement
for income provided
by the SERP
    
    Mr. GissingerExecutive Deferred 
Compensation Plan
    
    Employees with base
salary in excess of
$150,000
    
    May defer up to 50%
of base salary that
exceeds Internal
Revenue Code
compensation limit
and up to 100% of
incentive awards
    
    Opportunity to plan
for retirement and
defer taxation
    
    Voluntary participation
All named executive
officers are eligible
 16




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##### Table of Contents



Named ExecutiveBenefit Program
    
    Eligibility
    
    Benefit
    
    Rationale
    
    Officer ParticipationDefined Benefit 
Pension Plan
    
    All employees hired
before January 1,
2006
    
    Defined percentage
of average base
salary
    
    Source of
post-employment
income
    
    All named executive
officersSupplemental
Executive
Retirement Plan
(the SERP)
    
    Certain executives
that were
participants on or
before December 31,
2005
    
    70% of average
annual salary less
offsets for those
in plan before 1998
and 20% to 33.3% of
average annual
salary for
participants
eligible after 1997
    
    Additional source
of post-employment
income to restore
benefits lost due
to statutory limits
on the qualified
defined benefit
pension plans
    
    Messrs. Mozilo,
Sambol, Sieracki
and Garcia
 Enhanced SERP (Mozilo only)
 Severance Benefits
  17




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##### Table of Contents




    
    The benefit plans in which the named executive officers participate
    
    Our general severance policy in non-change in control situations
    
    Our Change in Control Severance Plan
       Retention Program
  18




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##### Table of Contents




    
    Special Grant of CashSettled RSUs.Our special grant of RSUs was intended to motivate key employees,
including our named executive officers, to remain with us over the
next three years to assist us in
managing our evolving business, market conditions, and overall macroeconomic developments. To
ensure that awards were considered meaningful by recipients, the values generally reflected each
employees most recent annual equity grant made in April 2007. We placed a greater emphasis on the
first vesting year, so that fifty percent of the restricted stock units vest upon the first
anniversary of grant and twenty-five percent vest upon each of the second and third anniversaries
of grant. In addition, these units would settle in cash to prevent further dilution to
stockholders. These awards vest based only on whether the recipient remains employed with us,
which enhances the retention incentive of these awards.
    
    Cash Retention Payment.As described above, our key executives did not receive a cash bonus
for 2007 under our annual incentive program. Nonetheless, the Compensation Committee believed it was
important to acknowledge the contributions of these executives and to send an important message to
them that their recent and ongoing efforts are critical to our operational success. To support
these objectives, the Compensation Committee approved special cash retention payments for key
executives throughout the Company. These awards generally represented 50% of each executives 2007
annual cash incentive target, with certain exceptions to reflect critical skills and extraordinary
contributions during a difficult transition. For example, the Compensation Committee awarded Mr.
Sieracki a cash retention payment equal to 100% of his 2007 target bonus to reflect his significant
contributions during the third and fourth quarters of 2007 when the industrys and Companys
financial challenges were especially acute. The recipients were required to be employed by us
through March 14, 2008 to receive the payment.
  CashSettled RSUs
    
    Cash Retention PaymentGrant Date Fair
    
    
    
    
    
    % of 2007Name
    
    Number of Units
    
    Value1
    
    Amount
    

Annual
Incentive TargetAngelo R. Mozilo
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    David Sambol
    
    
    335,126
    
    
    $
    2,546,958
    
    
    $
    1,935,000
    
    
    
    50
    %Eric P. Sieracki
    
    
    148,945
    
    
    $
    1,131,982
    
    
    $
    1,500,000
    
    
    
    100
    %Carlos M. Garcia
    
    
    148,945
    
    
    $
    1,131,982
    
    
    $
    1,450,000
    
    
    
    50
    %Andrew Gissinger III2
    
    
    148,945
    
    
    $
    2,149,276
    
    
    $
    1,250,000
    
    
    
    50
    %
 
 1
    
    Reflects the number of units multiplied by the fair market value on the date
of grant.2
    
    In addition, as part of our retention program, the exercise
periods of Mr.
Gissingers 2004 and 2005 stock options were extended by two years and one year,
respectively. The aggregate incremental fair value with respect to the extension of
these stock options is $87,094, as determined in accordance with FAS 123R. 19




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##### Table of Contents



Summary of 2008 Compensation Actions
    Process for Granting Equity Awards
   20




---



##### Table of Contents



Stock Ownership Guidelines
   Fixed Share Amount
    
    Number of SharesName
    
    (Guideline)
    
    Owned
    
    % of GuidelineAngelo R. Mozilo
    
    
    300,000
    
    
    
    1,093,774
    1
    
    
    365
    %David Sambol
    
    
    200,000
    
    
    
    75,278
    
    
    
    38
    %Eric P. Sieracki
    
    
    50,000
    
    
    
    182,482
    
    
    
    365
    %Carlos M. Garcia
    
    
    50,000
    
    
    
    507,401
    
    
    
    1,015
    %Andrew Gissinger III
    
    
    50,000
    
    
    
    1,857
    
    
    
    4
    %
 
 1
    
    Excludes 129,891 shares of which Mr. Mozilo disclaims beneficial ownership. Tax Deductibility under Section 162(m) of the Internal Revenue Code
    Accounting Standards
 Accounting for
Share-Based Payment
 21




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##### Table of Contents



Section 409A of the Internal Revenue Code
  22




---



##### Table of Contents



COMPENSATION COMMITTEE REPORT
   
 
 COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
  23




---



##### Table of Contents



SUMMARY COMPENSATION TABLE
  Change inPension Value& NonqualifiedNon-Equity
    
    DeferredStock
    
    Option
    
    Incentive Plan
    
    Compensation
    
    All OtherName & Principal
    
    
    
    
    
    Salary
    
    Bonus
    
    Awards
    
    Awards
    
    Compensation
    
    Earnings
    
    Compensation
    
    TotalPosition(1)
    
    Year
    
    ($)
    
    ($)(2)
    
    ($)(3)(4)
    
    ($)(3)(5)
    
    ($)(6)
    
    ($)(7)
    
    ($)(8)
    
    ($)Angelo R. Mozilo
    
    
    2007
    
    
    
    1,900,000
    
    
    
    
    
    
    
    4,218,539
    
    
    
    3,400,885
    (9)
    
    
    
    
    
    
    1,116,360
    
    
    
    176,513
    
    
    
    10,812,297Chairman of the
Board and Chief
Executive
Officer
    
    
    2006
    
    
    
    2,866,667
    
    
    
    
    
    
    
    1,103,745
    
    
    
    26,669,172
    (9)
    
    
    20,461,473
    
    
    
    10,961
    
    
    
    643,205
    
    
    
    51,755,223Eric P. Sieracki
    
    
    2007
    
    
    
    715,313
    
    
    
    
    
    
    
    408,540
    (10)
    
    
    816,188
    
    
    
    
    
    
    
    270,231
    
    
    
    41,016
    
    
    
    2,251,288Executive
Managing
Director and
Chief Financial
Officer
    
    
    2006
    
    
    
    658,333
    
    
    
    
    
    
    
    
    
    
    
    593,660
    
    
    
    856,350
    
    
    
    246,301
    
    
    
    251,401
    
    
    
    2,606,045David Sambol
    
    
    2007
    
    
    
    1,400,000
    
    
    
    2,625,000
    (11)
    
    
    1,050,467
    
    
    
    4,731,245
    
    
    
    
    
    
    
    429,454
    
    
    
    127,400
    
    
    
    10,363,566President and
Chief Operating
Officer
    
    
    2006
    
    
    
    1,116,667
    
    
    
    
    
    
    
    26,118
    
    
    
    5,111,432
    
    
    
    5,250,000
    
    
    
    254,549
    
    
    
    214,613
    (12)
    
    
    11,973,379
    (12)Carlos M. Garcia
    
    
    2007
    
    
    
    919,688
    
    
    
    
    
    
    
    233,452
    
    
    
    895,830
    
    
    
    
    
    
    
    319,373
    
    
    
    47,264
    
    
    
    2,415,607Executive
Managing
Director,
Enterprise Risk
Management and
Governance
    
    
    2006
    
    
    
    879,167
    
    
    
    
    
    
    
    
    
    
    
    875,917
    
    
    
    2,696,378
    
    
    
    307,773
    
    
    
    87,156
    
    
    
    4,846,391Andrew Gissinger III
    
    
    2007
    
    
    
    708,333
    
    
    
    
    
    
    
    390,650
    
    
    
    785,360
    
    
    
    
    
    
    
    35,203
    
    
    
    200,524
    
    
    
    2,120,070Executive
Managing
Director,
Residential
Lending
and Insurance
 
 (1)
    
    Mr. Gissinger was not a named executive officer for Fiscal 2006. Accordingly, this table only
reflects his compensation for Fiscal 2007.(2)
    
    Amounts earned by our named executive officers under our Annual Incentive Plan (and, if
applicable, our Supplemental Incentive Plan) are reported in the Non-Equity Incentive Plan
Compensation column. Incentive bonus formulas for such awards are specified in employment
agreements or approved by our Compensation Committee.(3)
    
    The amounts reported reflect the dollar amount recognized for financial statement reporting
purposes in accordance with FAS 123R and may include amounts from equity awards granted
prior to and during the relevant fiscal year. Assumptions used in the calculation of these
amounts are included in Note 2, Summary of Significant Accounting Policies, to our audited
financial statements for Fiscal 2003, 2004, 2005, 2006 and 2007, which are included in our
Annual Reports on Form 10-K for the respective years.(4)
    
    The amounts reported reflect restricted stock awards to the named executive officers granted
pursuant to our 2000 Equity Incentive Plan and restricted stock units (RSUs) granted to the
named executive officers pursuant to our 2000 and 2006 Equity
Incentive Plans.(5)
    
    The amounts reported reflect stock options granted to Mr. Mozilo and stock appreciation
rights (SARs) granted to the other named executive officers pursuant to our 2000 Equity
Incentive Plan in Fiscal 2006 and SARs granted to all of the named executive officers pursuant
to our 2000 and 2006 Equity Incentive Plans in Fiscal 2007. Amounts reported also reflect stock option grants to the
named executive officers pursuant to our 1993 and 2000 Equity
Incentive Plans.Because Mr. Mozilo was eligible for retirement in Fiscal 2006, his Fiscal 2006 equity awards
would have vested pursuant to his previous employment agreement had he retired during Fiscal
2006. As a result, the amount reported for Fiscal 2006 reflects the full grant date fair value
of Mr. Mozilos equity compensation in Fiscal 2006. Mr. Mozilos Fiscal 2007 equity awards
would not have vested upon his retirement pursuant to his 2007 employment agreement and 24




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##### Table of Contents



accordingly, the amounts reported for Fiscal 2007 reflect only a portion of the grant date fair
value of Mr. Mozilos equity compensation in accordance
with FAS 123R.In November 2007, the expiration dates of the equity awards made to Mr. Gissinger in Fiscal
2004 and Fiscal 2005 were extended two years and one year, respectively, and, as a result, the
amount reported for Mr. Gissinger includes an additional $87,094 of incremental expense
attributable to this modification. This extension was approved by the Compensation Committee on
November 1, 2007 as part of the Companys retention program.(6)
    
    For Mr. Mozilo, the amounts reported reflect non-equity
incentive plan awards made pursuant to his employment agreement, our Annual Incentive Plan and, if applicable,
our Supplemental Annual Incentive Plan. For Mr. Sambol, the
amounts reported reflect non-equity incentive plan awards made pursuant to his employment agreement and our
Annual Incentive Plan. The amounts reported for Messrs. Sieracki, and Garcia reflect
non-equity incentive plan awards made under our Annual Incentive Plan. The named executive
officers were not awarded amounts for Fiscal 2007 because their performance targets for such
awards were not met.(7)
    
    The amounts reported consist of the following: Change in Actuarial Present Value
    
    Above-Market orIncrease in
    
    Increase in
    
    
    
    
    
    PreferentialActuarial
    
    Actuarial
    
    
    
    
    
    Earnings onPresent Value
    
    Present Value
    
    Aggregate Change in
    
    DeferredPension Plan
    
    SERP
    
    Actuarial Present
    
    Compensation
    
    TotalName
    
    Year
    
    (a)($)
    
    (b)($)
    
    Value ($)
    
    (c)($)
    
    ($)Angelo R. Mozilo
    
    
    2007
    
    
    
    127,749
    
    
    
    946,313
    (d)
    
    
    1,074,062
    
    
    
    42,298
    
    
    
    1,116,3602006
    
    
    
    111,789
    
    
    
    (1,142,406
    )(e)
    
    
    (1,030,617
    )
    
    
    10,961
    
    
    
    10,961Eric P. Sieracki
    
    
    2007
    
    
    
    19,186
    
    
    
    249,248
    
    
    
    268,434
    
    
    
    1,797
    
    
    
    270,2312006
    
    
    
    23,059
    
    
    
    222,882
    
    
    
    245,941
    
    
    
    360
    
    
    
    246,301David Sambol
    
    
    2007
    
    
    
    15,294
    
    
    
    394,424
    
    
    
    409,718
    
    
    
    19,736
    
    
    
    429,4542006
    
    
    
    20,020
    
    
    
    230,412
    
    
    
    250,432
    
    
    
    4,117
    
    
    
    254,549Carlos M. Garcia
    
    
    2007
    
    
    
    23,395
    
    
    
    293,640
    
    
    
    317,035
    
    
    
    2,339
    
    
    
    319,3732006
    
    
    
    29,273
    
    
    
    277,927
    
    
    
    307,200
    
    
    
    573
    
    
    
    307,773Andrew Gissinger III
    
    
    2007
    
    
    
    12,499
    
    
    
    
    
    
    
    12,499
    
    
    
    22,704
    
    
    
    35,203
 
 (a)
    
    The amounts reported reflect the actuarial increase in the present value of each
named executive officers benefits under our Defined Benefit Pension Plan, which we refer
to as our Pension Plan.(b)
    
    The amounts reported for Messrs. Mozilo, Sieracki, Sambol and Garcia reflect the
actuarial increase in the present value of each named executive officers benefits under
our Supplemental Executive Retirement Plan (SERP). The amounts reported include amounts
which the named executive officer may not have been entitled to receive in the relevant
fiscal year because such amounts had not yet vested.Mr. Gissinger elected to transfer the present value of his SERP benefit as of
December 31, 2005 to the Executive Contribution Account Plan effective January 1,
2006.(c)
    
    The amounts reported reflect above-market earnings on compensation deferred by
each named executive officer in our Executive Deferred Compensation
Plan. Mr. Gissinger also received above-market earnings on amounts
deferred pursuant to our Executive Contribution Account Plan.(d)
    
    Effective January 1, 2007, Mr. Mozilo commenced receipt of monthly SERP benefits.
Under the SERP, a participant becomes entitled to receive payment of monthly benefits
once the participants age and years of service equal 105. Mr. Mozilo attained such
status in December 2006. Furthermore, because Mr. Mozilos benefit is not deductible by
the Company under Section 162(m) of the Internal Revenue Code of 1986, as amended (the
Internal Revenue Code), his benefits have been deferred until such time that they would
be deductible. The deferred payments are credited with a fixed interest rate determined
annually based on the Moodys Corporate Average available to participants in the
Executive Deferred Compensation Plan. Mr. Mozilos annual SERP benefit as of December
31, 2006 was $2,147,099. This amount will remain unchanged for the
duration of his fifteen years of payments. The increase reflected in this column for
Fiscal 2007 is a result of accrued earnings on the deferred amounts for the year, the
receipt of benefit payments during the year and the discounting of the remaining
payments.(e)
    
    Under the terms of the SERP and his employment agreement,
Mr. Mozilo was entitled to
a maximum SERP benefit of $3,000,000 per year minus the actuarial present value of his
accrued benefits under the Pension Plan and the actuarial present value of Company
contributions to his Executive Deferred Compensation Plan account. For Fiscal 2006, the
actuarial present values of the Pension Plan benefits and Executive Deferred Compensation
Plan Company contributions increased in comparison to their respective Fiscal 2005
values, causing the amount of Mr. Mozilos SERP benefit to decrease by a corresponding
amount in comparison to his Fiscal 2005 SERP 25




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##### Table of Contents



benefit amount. As a result, the change in
actuarial present value of Mr. Mozilos SERP benefit for Fiscal 2006 was negative, and,
consequently, the total aggregate change in actuarial present value for both the Pension
Plan and
the SERP Plan was negative. This negative number is not reflected in the Fiscal 2006 total
reported in the Summary Compensation Table for Mr. Mozilo. (8)
    
    The amounts reported consist of the following:
 RegistrantPerquisites
    
    
    
    
    
    Contributions& Other
    
    
    
    
    
    to Defined
    
    LifePersonal
    
    Tax
    
    Contribution
    
    InsuranceBenefits
    
    Reimbursements
    
    Plans
    
    Premiums
    
    Other
    
    TotalName
    
    Year
    
    (a)($)
    
    (b)($)
    
    (c)($)
    
    ($)
    
    (d)($)
    
    ($)Angelo R. Mozilo
    
    
    2007
    
    
    
    108,028
    
    
    
    8,798
    
    
    
    6,750
    
    
    
    4,560
    
    
    
    48,377
    
    
    
    176,5132006
    
    
    
    162,626
    
    
    
    16,045
    
    
    
    406,600
    
    
    
    3,715
    
    
    
    54,219
    
    
    
    643,205Eric P. Sieracki
    
    
    2007
    
    
    
    28,472
    
    
    
    
    
    
    
    6,750
    
    
    
    5,794
    
    
    
    
    
    
    
    41,0162006
    
    
    
    213,395
    
    
    
    
    
    
    
    33,694
    
    
    
    4,312
    
    
    
    
    
    
    
    251,401David Sambol
    
    
    2007
    
    
    
    113,629
    
    
    
    1,981
    
    
    
    6,750
    
    
    
    5,040
    
    
    
    
    
    
    
    127,4002006
    
    
    
    117,852
    
    
    
    18,336
    
    
    
    31,183
    
    
    
    5,040
    
    
    
    42,202
    
    
    
    214,613Carlos M. Garcia
    
    
    2007
    
    
    
    32,954
    
    
    
    
    
    
    
    6,750
    
    
    
    7,560
    
    
    
    
    
    
    
    47,2642006
    
    
    
    34,496
    
    
    
    595
    
    
    
    45,975
    
    
    
    6,090
    
    
    
    
    
    
    
    87,156Andrew Gissinger III
    
    
    2007
    
    
    
    47,367
    
    
    
    
    
    
    
    145,509
    
    
    
    4,648
    
    
    
    3,000
    
    
    
    200,524
 
 (a)
    
    The amounts reported reflect the aggregate incremental cost of perquisites and other
personal benefits provided to the named executive officers, including the personal use of
Company aircraft, payment of country club memberships, payments for automobiles, paid tax and
investment advice, executive physicals, and recreational activities covered by us while
the named executive officer traveled for business, including the expenses of spouses and
guests. From time to time, the Company makes tickets to cultural and sporting events
available to our named executive officers and other employees for business purposes. If
not utilized for business purposes, they are made available to named executive officers
and other employees for personal use, which use has no incremental cost to the Company.Company Aircraft: The aggregate incremental cost of personal use of the Companys aircraft
for Mr. Mozilo in Fiscal 2007 was $44,454 and in Fiscal 2006 was $89,939. The aggregate
incremental cost of personal use of the Companys aircraft for Mr. Sambol in Fiscal 2007
was $62,574 and in Fiscal 2006 was $67,545. The aggregate incremental cost of personal use
of the Companys aircraft for Mr. Gissinger in Fiscal 2007 was $73. The Companys
aircraft was not used by the other named executive officers for personal use. The
incremental cost to the Company of personal use of the Companys aircraft is calculated
based on the average variable operating costs to the Company. Variable operating costs
include fuel costs, mileage, maintenance, crew travel expenses, catering and other
miscellaneous variable costs. The total annual variable costs are divided by the annual
number of flight hours the Company aircraft flew to derive an average variable cost per
flight hour. This average variable cost per flight hour is then multiplied by the flight
hours for personal use to derive the incremental cost. The fixed costs that do not change
based on usage, such as pilot salaries, depreciation costs of the Companys aircraft,
hangar expense for the home hangar and general taxes and insurance, are excluded from the
incremental cost calculation.Country Clubs: The costs for country clubs reported below reflect the total amount of
payments reimbursed to the named executive officer by the Company during Fiscal 2007 and
Fiscal 2006, including business-related usage. Eligible reimbursements included monthly
dues, assessments, fees and business-related meals. The costs to the Company for Fiscal
2007 were as follows: for Mr. Mozilo, $8,581; for Mr. Sieracki, $10,320; for Mr. Sambol,
$11,261; and for Mr. Gissinger, $13,329. The costs to the Company for Fiscal 2006 were as
follows: for Mr. Mozilo, $15,481; for Mr. Sieracki, $209,324, which included a one-time
$200,000 initiation fee; and for Mr. Sambol, $12,697.Automobiles: The costs for automobiles reported below reflect the total amount of payments
made by the Company during Fiscal 2007 and Fiscal 2006, including business-related usage.
These payments include monthly lease payments or allowances, applicable acquisition costs,
automobile insurance premiums, registration fees and regularly scheduled maintenance and
repair costs. The costs to the Company for Fiscal 2007 were as follows: for Mr. Mozilo,
$23,755; for Mr. Sieracki, $18,152; for Mr. Sambol, $18,119; for Mr. Garcia, $18,504; and
for Mr. Gissinger, $12,000. The costs to the Company for Fiscal 2006 were as follows: for
Mr. Mozilo, $27,010; for Mr. Sieracki, $4,038; for Mr. Sambol, $20,711; and for Mr.
Garcia, $22,682. 26




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##### Table of Contents



Paid Tax and Investment Advice: The costs for paid tax and investment advice reported
below reflect the portion of total fees paid by the Company during Fiscal 2007 and Fiscal
2006. Named executive officers who utilize these services are responsible for 15% of the
total fees. The amounts reported below are paid by the Company and represent the remaining
85% of the total fees. The costs to the Company for Fiscal 2007 were as follows: for Mr.
Mozilo, $31,238; for Mr. Sambol, $21,675; for Mr. Garcia, $14,450; and for Mr. Gissinger,
$14,450. The costs to the Company for Fiscal 2006 were as follows: for Mr. Mozilo,
$30,196; for Mr. Sambol, $10,561; and for Mr. Garcia, $10,561.Executive Physical: The Company paid for Mr. Gissingers executive physical in Fiscal
2007, and the cost to the Company was $2,454.Guest Expenses: The costs for guest expenses reported below reflect the payments made on
behalf of or reimbursed to the named executive officers during Fiscal 2007 and Fiscal 2006
for expenses related to spousal or guest recreational expenses. The costs to the Company
for Fiscal 2007 were as follows: for Mr. Gissinger, $5,061. The costs to the Company for
Fiscal 2006 were as follows: for Mr. Sambol, $6,338; and for Mr. Garcia, $1,037.(b)
    
    The amounts reported reflect amounts paid to named executive officers during Fiscal
2007 and Fiscal 2006 for reimbursement of taxes owed with respect to any compensation paid
to the named executive officer, including, but not limited to, perquisites and other
personal benefits (including personal use of the Companys aircraft). Messrs. Mozilo and
Sambol were provided with tax reimbursements associated with spousal travel on the
Companys aircraft for Fiscal 2007 in the amounts of $8,798 and $1,981, respectively, and
for Fiscal 2006 in the amounts of $16,045 and $13,661, respectively. For purposes of
calculating this gross-up amount, personal aircraft usage was valued using a methodology
derived from the Standard Industry Fare Level rules promulgated by the Internal Revenue
Service. Messrs. Sambol and Garcia were provided with tax reimbursements for
personal-related expenses at business-related events for Fiscal 2006 in the amounts of
$4,675 and $595, respectively. Effective January 1, 2007, the Company no longer
reimburses taxes for expenses related to guest attended events. No named executive
officer received tax reimbursements for personal-related expenses at business-related
events for Fiscal 2007.(c)
    
    The amounts reported reflect our contributions to the
named executive officers accounts under our Executive Deferred Compensation Plan, our Executive Contribution
Account Plan and our 401(k) Plan. Beginning with Fiscal 2007, the Company is no longer
making any contributions to the accounts of Messrs. Mozilo, Sieracki, Sambol and Garcia
with respect to the Executive Deferred Compensation Plan. In Fiscal 2007, the Company
made a contribution of $138,759 to the Executive Contribution Account Plan account of Mr.
Gissinger.(d)
    
    The amounts reported reflect contributions made by us to the Director Charitable
Awards Program and the Executive Matching Gift Program.Director Charitable Award Program.We fund the Director Charitable Award Program through
life insurance policies. The amount for Mr. Mozilo for Fiscal 2007 was $47,377 and for
Fiscal 2006 was $44,219. These amounts were determined by dividing the aggregate of all
life insurance premiums paid by the Company by the number of current
and former directors, including
Directors Emeriti and Mr. Mozilo (but not including Mr. Sambol), eligible to participate
in the Director Charitable Award Program during Fiscal 2007 and
Fiscal 2006.Executive Matching Gift Program.Until September 2006, the Company matched gifts by named
executive officers to charitable organizations dollar for dollar, up to $50,000 annually
per named executive officer. If the named executive officer was on the governing board of
the organization, the Company would match 3 to 1 up to the $50,000 limit. Since September
2006, the Company has matched gifts by any Company employee to charitable organizations
dollar for dollar, up to $1,000 annually per employee. The costs to the Company for Fiscal
2007 for matching gifts for named executive officers were as follows: for Mr. Mozilo,
$1,000; and for Mr. Gissinger, $3,000 (a one-time exception to our policy was made for a
donation by Mr. Gissinger). The costs to the Company for Fiscal 2006 for matching gifts
for named executive officers were as follows: for Mr. Mozilo, $10,000; and for Mr. Sambol,
$42,202. As described in footnote 12 below, the amount reported for Fiscal 2006 in our
2007 proxy statement for Mr. Sambol was $34,534, which amount did not include a matching
gift of $7,668 made on behalf of Mr. Sambol. (9)
    
    In our 2007 proxy statement, the compensation reported with respect to Mr. Mozilos option
awards for Fiscal 2006 was reported as $23,047,104. This amount reflected expense
attributable to his April 2004 stock option award with performance-based vesting. Pursuant to
his employment agreement in effect at the time, however, the award is deemed
 27




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##### Table of Contents



to be time-vested, not performance-based vested, resulting in straight-line expense over the
vesting period. The compensation expense number for Fiscal 2006 and the compensation expense number for Fiscal 2007 reported in this table reflect straight-line expensing of this award.
 (10)
    
    On April 2, 2007, Mr. Sieracki received a one-time discretionary award of performance-based
RSUs with a grant date fair market value of $750,000 in consideration for his performance and
expanded duties during Fiscal 2006. The award was made under the 2006 Equity Incentive Plan
and will vest in equal installments over three years, provided the Companys ROE equals or
exceeds 12% in each year and Mr. Sieracki remains employed by the Company. The first
installment for 2007 did not vest because the Companys ROE did not equal or exceed 12% for
Fiscal 2007.
 (11)
    
    On March 27, 2007, the Company entered into an employment agreement with Mr. Sambol. Under
that agreement, Mr. Sambol received a cash lump-sum bonus of $2,625,000 in consideration of
his efforts in Fiscal 2006 prior to his promotion to President and Chief Operating Officer of
the Company and his increased responsibilities following such promotion in Fiscal 2007.
 (12)
    
    In our 2007 proxy statement, the All Other Compensation reported for Mr. Sambol for Fiscal
2006 was $206,945. This amount did not include a matching gift of $7,668 made on behalf of Mr.
Sambol pursuant to the Companys Matching Gift Program described in footnote 8(d) above. The
amount for Fiscal 2006 has been changed to reflect this correction.
 28




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##### Table of Contents



GRANTS OF PLAN-BASED AWARDS
 All Other
    
    All OtherStock
    
    OptionAwards:
    
    Awards:
    
    Exercise
    
    GrantEstimated Future Payouts Under
    
    
    
    
    
    
    
    
    
    
    
    
    
    Number of
    
    Number of
    
    or Base
    
    Date FairDate of
    
    Non-Equity Incentive Plan
    
    Estimated Future Payouts Under Equity
    
    Shares of
    
    Securities
    
    Price of
    
    Value ofCommittee
    
    Awards(2)
    
    Incentive Plan Awards
    
    Stock or
    
    Underlying
    
    Option
    
    Stock andGrant
    
    Approval
    
    Threshold
    
    Target
    
    Maximum
    
    Threshold
    
    Target
    
    Maximum
    
    Units
    
    Options
    
    Awards (3)
    
    OptionName
    
    Date
    
    (1)
    
    ($)
    
    ($)
    
    ($)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    ($/Sh)
    
    AwardsAngelo R. Mozilo
Annual
Incentive Plan
Award
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,000,000
    
    
    
    10,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
Incentive Plan
Awards
    
    
    2/13/07
    
    
    
    2/13/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120,541
    (4)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000,0412/13/07
    
    
    
    2/13/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120,540
    (4)
    
    
    
    
    
    
    
    
    
    
    4,999,9994/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    152,766
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000,0314/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    566,894
    (6)
    
    
    32.73
    
    
    
    5,000,005Eric P. Sieracki
Annual
Incentive Plan
Award
    
    
    
    
    
    
    
    
    
    
    360,000
    
    
    
    1,500,000
    
    
    
    3,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
Incentive Plan
Awards
    
    
    4/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,915
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    750,0084/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,555
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,000,0654/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (6)
    
    
    32.73
    
    
    
    1,000,065David Sambol
Annual
Incentive Plan
Award
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,870,000
    
    
    
    6,250,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
Incentive Plan
Awards
    
    
    4/2/07
    
    
    
    3/26/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    137,489
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,500,0154/2/07
    
    
    
    3/26/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    510,205
    (6)
    
    
    32.73
    
    
    
    4,500,008Carlos M. Garcia
Annual
Incentive Plan
Award
    
    
    
    
    
    
    
    
    
    
    696,000
    
    
    
    2,900,000
    
    
    
    5,800,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
Incentive Plan
Awards
    
    
    4/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,555
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,000,0654/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (6)
    
    
    32.73
    
    
    
    1,000,065Andrew Gissinger III
Annual
Incentive Plan
Award
    
    
    
    
    
    
    
    
    
    
    600,000
    
    
    
    2,500,000
    
    
    
    5,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
Incentive Plan
Awards
    
    
    4/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,555
    (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,000,0654/2/07
    
    
    
    2/28/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (6)
    
    
    32.73
    
    
    
    1,000,06511/1/07
    
    
    
    11/1/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    148,945
    (7)
    
    
    
    
    
    
    
    
    
    
    2,149,27611/1/07
    (8)
    
    
    11/1/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54,776
    (9)
    
    
    31.86
    (10)
    
    
    38,343
    (11)11/1/07
    (8)
    
    
    11/1/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,000
    (9)
    
    
    34.43
    (10)
    
    
    13,800
    (11)11/1/07
    (8)
    
    
    11/1/07
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,087
    (9)
    
    
    32.60
    (10)
    
    
    34,951
    (11)
 29




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##### Table of Contents



(1)
    
    The awards for the named executive officers approved by the Compensation Committee on
February 28, 2007 and March 26, 2007 were granted on the first business day in April 2007.(2)
    
    For Mr. Mozilo, the amounts reported reflect the target and maximum amounts
payable pursuant to his employment agreement, our Annual Incentive Plan and/or our
Supplemental Annual Incentive Plan.For Mr. Sambol, the amounts reported reflect the target and maximum amounts payable
pursuant to his employment agreement and our Annual Incentive Plan.For Messrs. Sieracki, Garcia and Gissinger the amounts reported reflect the threshold, target
and maximum amounts payable pursuant to each of their individual annual incentive arrangements.
Awards to Messrs. Sieracki, Garcia and Gissinger are made pursuant to our Annual Incentive Plan
with terms approved by the Compensation Committee.
The threshold, target and maximum non-equity incentive awards for each of the named executive
officers are more fully described under the heading Compensation Discussion and Analysis. The
named executive officers were not awarded non-equity incentive plan awards for Fiscal 2007
because their performance targets were not met for Fiscal 2007, as reported in the Non-Equity
Incentive Plan Compensation column of the Summary Compensation Table.(3)
    
    As of January 1, 2007, the exercise price or base price used for our 2000 and 2006 Equity
Incentive Plans is the closing price of our common stock on the date of grant.(4)
    
    In exchange for Mr. Mozilos agreement to extend his term as the Companys Chief Executive
Officer beyond December 31, 2006, he received a one-time RSU award pursuant to the terms of
his employment agreement valued at $10 million on the date of grant. One-half of the award
will vest if he remains continuously employed by the Company through December 16, 2009. The
other half of the award will vest if the Compensation Committee determines that the Companys
total shareholder return for the period January 1, 2007 through December 31, 2009 has exceeded
the 50th percentile of total shareholder returns of the companies comprising the
S&P Financial Services Index and Mr. Mozilo remains continuously employed by the Company
through the term of his employment agreement.(5)
    
    Awards of RSUs made under the 2006 Equity Incentive Plan vest in equal installments over
three years, provided the Companys ROE equals or exceeds 12% in each year and the named
executive officer remains employed by the Company. The first tranche of such awards did not
vest in Fiscal 2007 because the performance target was not satisfied. The table reflects the
original number of units issued. The award to Mr. Sieracki with a grant date fair market
value of $750,000 was a one-time discretionary award of performance-based RSUs in
consideration for his performance and expanded duties during Fiscal 2006.(6)
    
    Awards of SARs made under the 2000 and 2006 Equity Incentive Plans vest in equal installments
over three years, provided the named executive officer remains
employed by the Company during the applicable vesting period.(7)
    
    Mr. Gissingers award of RSUs granted under our 2006 Equity Incentive Plan will be settled in
cash and will vest 50% in 2008, 25% in 2009 and 25% in 2010. This grant was approved by the
Compensation Committee as part of the Companys retention program, as more fully described under
the heading Compensation Discussion and Analysis.(8)
    
    The exercise period of the option awards made to Mr. Gissinger in Fiscal 2004 and Fiscal 2005
under our 2000 Equity Incentive Plan were extended by the Compensation Committee on November
1, 2007 as part of the Companys retention program, as more fully described under the heading
Compensation Discussion and Analysis. The original grant dates in order listed on the table
are April 1, 2004, June 15, 2004 and April 1, 2005.(9)
    
    Represents the number of securities underlying Mr. Gissingers Fiscal 2004 and Fiscal 2005
option awards that remained outstanding at the time of the extension described in footnote 8
above.(10)
    
    Represents the original exercise prices of Mr. Gissingers Fiscal 2004 and Fiscal 2005
modified option awards described in footnote 8 above. The exercise prices were not adjusted
due to the modification and are equal to the average of the highest and lowest prices for our
common stock on the date of grant.(11)
    
    Represents the incremental fair value expense of Mr. Gissingers modified awards, as
determined in accordance with FAS 123R. 30




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##### Table of Contents



Employment Agreements
  Annual Incentive Awards and Bonuses
   Equity Awards and Additional Information
  31




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##### Table of Contents



OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END (1)
 Option Awards(2)
    
    Stock Awards(3)Equity IncentiveEquity Incentive
    
    Plan Awards: MarketNumber of
    
    Number of
    
    
    
    
    
    
    
    
    
    Number
    
    Market Value
    
    Plan Awards: Number
    
    or Payout Value ofSecurities
    
    Securities
    
    
    
    
    
    
    
    
    
    of Shares or
    
    of Shares or
    
    of Unearned Shares,
    
    Unearned Shares,Underlying
    
    Underlying
    
    Option
    
    
    
    
    
    Units of Stock
    
    Units of Stock
    
    Units or Other
    
    Units or OtherUnexercised
    
    Unexercised
    
    Exercise
    
    Option
    
    That Have Not
    
    That Have Not
    
    Rights that Have
    
    Rights that HaveOptions
    
    Options (#)
    
    Price
    
    Expiration
    
    Vested
    
    Vested
    
    Not Vested
    
    Not VestedName
    
    (#) Exercisable
    
    Unexercisable
    
    ($)
    
    Date
    
    (#)
    
    ($)
    
    (#)
    
    ($)Angelo R. Mozilo
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    123,609
    (4)
    
    
    1,105,064
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    123,610
    (5)
    
    
    1,105,073
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104,437
    (6)
    
    
    933,6661,149,777
    
    
    
    
    
    
    
    14.69
    
    
    
    4/1/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    600,000
    
    
    
    
    
    
    
    18.98
    
    
    
    6/11/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,400,000
    
    
    
    
    
    
    
    31.86
    
    
    
    4/1/2014
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,400,000
    
    
    
    
    
    
    
    32.60
    
    
    
    4/1/2015
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    466,666
    
    
    
    933,334
    (7)
    
    
    36.45
    
    
    
    4/3/2016
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    188,964
    
    
    
    377,930
    (8)
    
    
    32.73
    
    
    
    4/2/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Eric P. Sieracki
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,745
    (6)
    
    
    140,759
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,993
    (6)
    
    
    187,6799,432
    
    
    
    
    
    
    
    11.68
    
    
    
    6/1/2008
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40,002
    
    
    
    
    
    
    
    9.94
    
    
    
    6/1/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,200
    
    
    
    
    
    
    
    9.60
    
    
    
    2/12/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46,800
    
    
    
    
    
    
    
    10.89
    
    
    
    3/19/2012
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,000
    
    
    
    
    
    
    
    14.69
    
    
    
    4/1/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,000
    
    
    
    
    
    
    
    18.98
    
    
    
    6/11/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54,776
    
    
    
    
    
    
    
    31.86
    
    
    
    4/1/2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    80,906
    
    
    
    
    
    
    
    32.60
    
    
    
    4/1/2010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53,397
    
    
    
    108,415
    (10)
    
    
    36.45
    
    
    
    4/3/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (11)
    
    
    32.73
    
    
    
    3/31/2012
    (12)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    David Sambol
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    93,994
    (6)
    
    
    840,303130,543
    
    
    
    
    
    
    
    13.24
    
    
    
    2/28/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    128,334
    
    
    
    
    
    
    
    14.69
    
    
    
    4/1/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    139,190
    
    
    
    
    
    
    
    18.98
    
    
    
    6/11/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,065,000
    
    
    
    
    
    
    
    31.86
    
    
    
    4/1/2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    657,282
    
    
    
    
    
    
    
    32.60
    
    
    
    4/1/2010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    260,283
    
    
    
    528,455
    (10)
    
    
    36.45
    
    
    
    4/3/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    170,068
    
    
    
    340,137
    (13)
    
    
    32.73
    
    
    
    4/2/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Carlos M. Garcia
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,993
    (6)
    
    
    187,6798,560
    
    
    
    
    
    
    
    11.68
    
    
    
    6/1/2008
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    200,002
    
    
    
    
    
    
    
    9.94
    
    
    
    6/1/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    94,000
    
    
    
    
    
    
    
    9.60
    
    
    
    2/12/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    106,000
    
    
    
    
    
    
    
    10.89
    
    
    
    3/19/2012
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    168,000
    
    
    
    
    
    
    
    14.69
    
    
    
    4/1/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    72,000
    
    
    
    
    
    
    
    18.98
    
    
    
    6/11/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    131,432
    
    
    
    
    
    
    
    31.86
    
    
    
    4/1/2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    129,450
    
    
    
    
    
    
    
    32.60
    
    
    
    4/1/2010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53,397
    
    
    
    108,415
    (10)
    
    
    36.45
    
    
    
    4/3/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (11)
    
    
    32.73
    
    
    
    3/31/2012
    (12)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Andrew Gissinger III
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    148,945
    (14)
    
    
    1,331,568
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,993
    (6)
    
    
    187,67947,588
    
    
    
    
    
    
    
    9.94
    
    
    
    6/1/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    33,550
    
    
    
    
    
    
    
    9.60
    
    
    
    2/12/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    78,952
    
    
    
    
    
    
    
    10.89
    
    
    
    3/19/2012
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,000
    
    
    
    
    
    
    
    14.69
    
    
    
    4/1/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,000
    
    
    
    
    
    
    
    18.98
    
    
    
    6/11/2013
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54,776
    
    
    
    
    
    
    
    31.86
    
    
    
    4/1/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,000
    
    
    
    
    
    
    
    34.43
    
    
    
    6/15/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,087
    
    
    
    
    
    
    
    32.60
    
    
    
    4/1/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40,048
    
    
    
    81,311
    (10)
    
    
    36.45
    
    
    
    4/3/2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113,386
    (11)
    
    
    32.73
    
    
    
    3/31/2012
    (12)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 32




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##### Table of Contents



(1)
    
    The outstanding equity awards do not include the first tranche of the performance-vested RSUs
granted in April 2007 to each of the named executive officers, which tranche was forfeited
because the performance targets for those RSUs were not satisfied. Unless otherwise stated in
the footnotes below, the outstanding equity awards were granted pursuant to our 2000 Equity
Incentive Plan.(2)
    
    Stock options granted to the named executive officers prior to Fiscal 2004 have an exercise
period of ten years. Stock options granted during and after Fiscal 2004 to named executive
officers other than Mr. Mozilo have an exercise period of five years, except that stock
options granted to Mr. Gissinger in 2004 and 2005 had exercise periods extended to 2011. Stock
options granted to Mr. Mozilo during and after Fiscal 2004 have an exercise period of ten
years in accordance with Mr. Mozilos employment agreements. All SARs granted to the named
executive officers have an exercise period of five years.(3)
    
    The closing price of our common stock on December 31, 2007 was $8.94. All outstanding awards
of RSUs were made pursuant to our 2006 Equity Incentive Plan.(4)
    
    Consists of RSUs that vest on December 16, 2009. Includes accumulated dividend equivalents.(5)
    
    Consists of RSUs that vest if Mr. Mozilo remains continuously employed through December 16,
2009, but only if (1) our total stockholder return exceeds the 50th percentile of
total stockholder return performance of the S&P Financial Services Index over the period from
January 1, 2007 through December 31, 2009 and (2) Mr. Mozilo remains continuously employed by
the Company through the vesting date. Includes accumulated dividend equivalents.(6)
    
    Consists of RSUs that vest in equal installments over three years, provided the Companys ROE
equals or exceeds 12% in each year and the named executive officer remains employed by the
Company. Because the performance target was not satisfied, one-third of the April 2007
performance-based RSU award has been forfeited. Includes accumulated dividend equivalents.(7)
    
    Consists of stock options that vest ratably over a three-year period. One-third of the
original award vested on April 1, 2007, one-third vested on April 1, 2008 and the
remaining one-third will vest on April 1, 2009.(8)
    
    Consists of stock-settled SARs that vest ratably over a three-year period. One-third of the
original award vested on December 16, 2007, one-third will vest on December 16, 2008 and the
remaining one-third will vest on December 16, 2009.(9)
    
    Consists of stock options granted pursuant to our 1993 Equity Incentive Plan.(10)
    
    Consists of stock-settled SARs that vest ratably over a three-year period. One-third of the
original award vested on April 1, 2007, one-third vested on April 1, 2008 and the remaining
one-third will vest on April 1, 2009.(11)
    
    Consists of stock-settled SARs that vest ratably over a three-year period. One-third of the
original award vested on April 1, 2008, one-third will vest on April 1, 2009 and the remaining
one-third on April 1, 2010.(12)
    
    Consists of SARs granted pursuant to our 2006 Equity Incentive Plan.(13)
    
    Consists of stock-settled SARs that vest ratably over a three-year period. One-third of the
original award vested on December 31, 2007, one-third will vest on December 31, 2008 and the
remaining one-third on December 31, 2009.(14)
    
    Consists of RSUs that will be settled in cash and will vest 50% on November 1, 2008, 25% on
November 1, 2009 and the remaining 25% on November 1, 2010. These RSUs were granted in
connection with the Companys retention program as more fully described under the heading
Compensation Discussion and Analysis. 33




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##### Table of Contents



OPTION EXERCISES AND STOCK VESTED
 Option Awards
    
    Stock AwardsNumber of Shares
    
    Value Realized on
    
    Number of Shares AcquiredAcquired on Exercise
    
    Exercise
    
    on Vesting
    
    Value Realized on VestingName
    
    (#)(1)
    
    ($)
    
    (#)
    
    ($)Angelo R. Mozilo
    
    
    4,922,588
    
    
    
    121,502,318
    
    
    
    
    
    
    
    Eric P. Sieracki
    
    
    16,708
    
    
    
    537,568
    (2)
    
    
    
    
    
    
    David Sambol
    
    
    203,625
    
    
    
    4,793,430
    
    
    
    
    
    
    
    Carlos M. Garcia
    
    
    154,576
    
    
    
    5,268,846
    
    
    
    
    
    
    
    Andrew Gissinger III
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    During Fiscal 2007, Messrs. Mozilo, Sambol and Garcia informed us that they exercised
options and sold shares of our common stock pursuant to written trading plans intended to
comply with the requirements of Rule 10b5-1 of the Exchange Act.(2)
    
    In Fiscal 2007, Mr. Sieracki exercised 16,708 stock options through a stock swap exercise,
receiving 13,806 new shares of common stock in return. No shares of common stock were sold as
part of this transaction. 34




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##### Table of Contents



PENSION BENEFITS
  PaymentsNumber of Years
    
    Present Value of
    
    During Lastof Credited Service
    
    Accumulated Benefit
    
    Fiscal YearName
    
    Plan Name
    
    (#)(1)
    
    ($)(2)(3)
    
    ($)Angelo R. Mozilo
    
    Pension Plan
    
    
    38.667
    
    
    
    1,476,328
    
    
    
    SERP
    
    
    13.83333
    
    
    
    23,363,268
    
    
    
    2,147,099
    (4)Eric P. Sieracki
    
    Pension Plan
    
    
    18
    
    
    
    240,877
    
    
    
    SERP
    
    
    13.83333
    
    
    
    1,097,192
    
    
    
    David Sambol
    
    Pension Plan
    
    
    22
    
    
    
    257,202
    
    
    
    SERP
    
    
    13.83333
    
    
    
    2,128,995
    
    
    
    Carlos M. Garcia
    
    Pension Plan
    
    
    23
    
    
    
    349,043
    
    
    
    SERP
    
    
    13.83333
    
    
    
    1,482,650
    
    
    
    Andrew Gissinger III
    
    Pension Plan
    
    
    9
    
    
    
    96,158
    
    
    
    SERP
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    Pension Plan.Mr. Mozilos number of years of credited service with respect to the Pension
Plan is equal to his years of service with the Company. Each of the other named executive
officers number of years of credited service with respect to the Pension Plan is one year
less than his actual years of service with the Company. This difference is due to a change in
the Pension Plan participation rules effective for participants hired after February 1983.SERP. Each named executive officer who participates in the SERP has been credited with 13.8333
years of service, which is the number of years from March 1, 1994 (the date the SERP commenced
and the date such named executive officers began their participation), to December 31, 2007.(2)
    
    Mr. Mozilo is fully vested in the SERP. Each of the other named executive officers who
participate in the SERP is not currently entitled to receive the SERP amounts reported
because his amount has not yet vested. The SERP vesting dates for each of Messrs.
Sieracki, Sambol and Garcia are August 13, 2011, December 7, 2014 and October 10, 2010,
respectively. Mr. Gissinger does not participate in the SERP. Instead, he participates in the
Companys Executive Contribution Account Plan.(3)
    
    The amounts reported reflect the actuarial present value of a named executive officers
accumulated benefit under the Pension Plan and the SERP, if applicable, computed as of the
same pension plan measurement date used for our audited financial statements for Fiscal 2007
and using interest rate assumptions consistent with those disclosed in Note 20, Employee
Benefits, to our audited financial statements for Fiscal 2007, which are included in our Form
10-K for Fiscal 2007.The amount reported for Mr. Mozilo includes $2,147,099 in SERP payments for Fiscal 2007 that
have been deferred and earnings of $61,483 on that deferred amount during Fiscal 2007.(4)
    
    Under the SERP, a participant becomes entitled to receive payment of monthly benefits once
the participants age and years of service equal 105. Mr. Mozilo attained such status in
December 2006. In January 2007, Mr. Mozilo was entitled to begin receiving his SERP benefit
of $2,147,099 per year, to be paid out over fifteen years. Because Mr. Mozilos benefit is
not deductible by the Company under Section 162(m) of the Internal Revenue Code, the benefit
payments he is entitled to receive have been deferred until such time that they would be
deductible. The deferred payments are credited with a fixed interest rate determined annually
based on the Moodys Corporate Average available to participants in the Executive Deferred
Compensation Plan. Pension Plan
  35




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##### Table of Contents



1 1
   Supplemental Executive Retirement Plan
     Enhanced Supplemental Executive Retirement Plan
  36




---



##### Table of Contents



401(k) Savings and Investment Plan
  37




---



##### Table of Contents



NONQUALIFIED DEFERRED COMPENSATION
  Executive
    
    Registrant
    
    
    
    
    
    Aggregate
    
    AggregateContributions
    
    Contributions in
    
    Aggregate Earnings in
    
    Withdrawals/
    
    Balance atName
    
    in Last FY
    
    Last FY
    
    Last FY
    
    Distributions
    
    Last FYE(1)
    
    ($)(2)
    
    ($)(3)
    
    ($)(4)
    
    ($)
    
    ($)(5)Angelo R. Mozilo
    
    
    
    
    
    
    
    
    
    
    885,262
    
    
    
    2,991,004
    
    
    
    16,429,249
    (6)Eric P. Sieracki
    
    
    218,770
    
    
    
    
    
    
    
    59,648
    
    
    
    173,914
    
    
    
    1,246,227David Sambol
    
    
    1,050,000
    
    
    
    
    
    
    
    450,300
    
    
    
    
    
    
    
    8,232,530Carlos M. Garcia
    
    
    
    
    
    
    
    
    
    
    51,709
    
    
    
    
    
    
    
    917,856Andrew Gissinger III
    
    
    2,021,228
    
    
    
    118,464
    
    
    
    502,543
    
    
    
    
    
    
    
    9,334,028
 
 (1)
    
    Each of the named executive officers is a participant in the
Executive Deferred Compensation Plan. Mr. Gissinger also participates in the Executive Contribution
Account Plan.(2)
    
    For Mr. Sieracki, the amounts include $47,500 of salary for Fiscal 2007, which amount is
reported in the Summary Compensation Table.For named executive officers who elected to defer portions of their Fiscal 2006 non-equity
incentive plan compensation, amounts in this column also include those deferrals. The Company
distributes non-equity incentive plan compensation in March of the year following the year in
which it is earned. For Messrs. Sieracki and Sambol, the amounts include $171,270 and
$1,050,000, respectively, of non-equity incentive plan compensation earned in Fiscal 2006, but
paid and credited to such named executive officers Executive Deferred Compensation Plan
account in Fiscal 2007. For Mr. Gissinger, the amount includes $2,021,228 of non-equity
incentive plan compensation earned in Fiscal 2006, but paid and credited to his Executive
Contribution Account Plan account in Fiscal 2007.(3)
    
    Beginning with Fiscal 2007, the Company is no longer making any contributions to the accounts
of Messrs. Mozilo, Sieracki, Sambol and Garcia with respect to the Executive Deferred
Compensation Plan.For Mr. Gissinger, the amount reported includes the Companys annual contribution pursuant to
the Executive Contribution Account Plan for Fiscal 2006 in the amount of $118,464 because that
amount was credited to Mr. Gissingers account in Fiscal 2007. It does not include the
Companys annual contribution pursuant to the Executive Contribution Account Plan for Fiscal
2007 in the amount of $138,759 because that amount was credited to Mr. Gissingers account in
Fiscal 2008. The Companys annual contribution pursuant to the Executive Contribution Account
Plan for Fiscal 2007 is included in the All Other Compensation column of the Summary
Compensation Table.(4)
    
    For Messrs. Mozilo, Sieracki, Sambol, Garcia and Gissinger, $42,298, $1,797, $19,736, $2,339
and $22,704, respectively, was reported as above-market earnings on deferred compensation in
the Summary Compensation Table.(5)
    
    For Messrs. Mozilo, Sieracki and Sambol, the aggregate balance includes $1,851,667, $76,000,
and $101,667, respectively, of salary for Fiscal 2006, which amounts were previously reported
in the Summary Compensation Table.(6)
    
    The aggregate balance for Mr. Mozilo at the end of Fiscal 2006 was understated by $391,682 in
the Companys 2007 proxy statement. As corrected, the aggregate balance of nonqualified
deferred compensation for Mr. Mozilo at the end of Fiscal 2006 was $20,996,559. Executive Deferred Compensation Plan
   38




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##### Table of Contents



One-YearAsset Class
    
    Fund Offering
    
    ReturnIntermediate Term Bond
    
    PIMCO Total Return C
    
    
    7.77
    %Lehman US Government/Credit Intermediate
    
    
    7.40
    %Large Cap Equity Blend
    
    DWS Equity 500 Index Inv
    
    
    5.39
    %S&P 500
    
    
    5.49
    %Small Cap Equity Blend
    
    DWS VIT Small Cap Index: CI A
    
    
    -1.90
    %Russell 2000
    
    
    -1.57
    %International Equity
    
    International Value
    
    
    6.25
    %MSCI EAFE Index
    
    
    11.63
    %Money Market
    
    Moodys Corporate Average
    
    
    6.07
    %
     Executive Contribution Account Plan
   One-YearAsset Class
    
    Fund Offering
    
    ReturnIntermediate Term Bond
    
    PIMCO Total Return Admin
    
    
    8.81
    %Lehman US Government/Credit Intermediate
    
    
    7.40
    %Large Cap Equity Blend
    
    DWS Equity 500 Index Inv
    
    
    5.39
    %S&P 500
    
    
    5.49
    %
 39




---



##### Table of Contents



One-YearAsset Class
    
    Fund Offering
    
    ReturnSmall Cap Equity Blend
    
    DWS VIT Small Cap Index: CI A
    
    
    -1.90
    %Russell 2000
    
    
    -1.57
    %International Equity
    
    International Value
    
    
    6.25
    %MSCI EAFE Index
    
    
    11.63
    %Money Market
    
    Moodys Corporate Average
    
    
    6.07
    %
 st
   40




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##### Table of Contents



POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE-IN-CONTROL
  
    
    Voluntary termination of employment by the named executive officer (with or
without good reason);
    
    Retirement (normal or early);
    
    Termination of employment by the Company (with or without cause);
    
    Termination in the event of the disability or death of the named executive
officer; and
    
    Termination following a change in control of the Company.
     Payments to Mr. Mozilo
 Employment Agreement with Mr. Mozilo
  Payments to Mr. Mozilo upon Voluntary Termination without Good Reason and His Normal Retirement
  
    
    all of his unvested restricted stock and stock options granted after November 9,
2004 and prior to January 1, 2007 would have become immediately vested and would have
remained exercisable for one year;
    
    a pro rata portion of his unvested RSUs granted on
April 2, 2007 would have
become immediately vested if the relevant performance metric was achieved and a pro rata
portion of his unvested SARs granted after January 1, 2007 would have become immediately
vested (the vested portion would be proportionate to the fraction of
days employed in the calendar year divided by 350); and
 41




---



##### Table of Contents




    
    he would have been entitled to receive an enhanced amount under the SERP paid
over fifteen years (because Mr. Mozilo is currently eligible for retirement, the value
of any SERP benefits would have been no greater than the amount included in the Pension
Benefits table).
 Payments to Mr. Mozilo upon Termination without Cause or Voluntary Termination with Good Reason
  
    
    he would have been entitled to receive a cash payment equal to three times his
then-applicable base salary plus his target annual non-equity incentive compensation for
the year in which the termination occurred;
    
    he would have been entitled to receive a pro rata portion of the annual
non-equity incentive compensation he was eligible to receive pursuant to his employment
agreement, based on time of service and annual performance;
    
    all of his unvested restricted stock, stock options, RSUs and SARs would have
become immediately vested/or exercisable, except that only a pro rata portion of the RSUs granted in connection with his agreeing to remain
the Companys Chief Executive Officer would have vested (the vested portion would be
proportionate to the fraction of the employment term served);
    
    he would have been entitled to receive an enhanced amount under the SERP paid
over fifteen years (because Mr. Mozilo is currently eligible for retirement, the value
of any SERP benefits would have been no greater than what is included in the Pension
Benefits table);
    
    he and his beneficiaries would have been entitled to continue to receive health
and life insurance benefits for three years (the continuation period); and
    
    following the continuation period, he and his spouse would have been entitled to
continue to receive health benefits for their lifetimes.
 Payments to Mr. Mozilo upon Termination for Cause
  Payments to Mr. Mozilo upon Death or Disability
  
    
    upon Mr. Mozilos death, his beneficiary would have continued to receive Mr.
Mozilos then-applicable base salary for a period of 12 months;
    
    upon Mr. Mozilos death or termination of his employment because of his
disability (as defined thereunder), he would have been entitled to receive a pro rata
portion of the annual non-equity incentive compensation he was eligible to receive
pursuant to his employment agreement, based on time of service and annual performance;
    
    upon Mr. Mozilos death or termination of his employment because of his
disability, all of his unvested restricted stock, stock options, RSUs and SARs would
have become immediately vested and/or exercisable;
    
    upon Mr. Mozilos death, he would have been entitled to receive an enhanced
amount under the SERP in a lump-sum cash payment instead of being paid out over fifteen
years (because Mr. Mozilo is currently eligible for retirement, the value of any SERP
benefits that he was entitled to receive was no greater than what is included in the
Pension Benefits table);
    
    upon Mr. Mozilos death, his beneficiaries would have been entitled to receive
health and life insurance benefits for one year and following that year, and his spouse
would have been entitled to receive health benefits for her lifetime;
    
    upon the termination of Mr. Mozilos employment because of his disability, he
would have continued to receive one-half of his then-applicable base salary until the
earlier of his death or December 16, 2009 (less any cash benefits he may have received
under the Companys disability plans and the Pension Plan); and
    
    upon Mr. Mozilos disability, he and his beneficiaries would have been entitled
to receive health, medical, dental and life insurance benefits for the earlier of his
death or December 16, 2009 and following that period, he and his spouse would have been
entitled to receive health benefits for their lifetimes.
 42




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##### Table of Contents



Payments to Mr. Mozilo upon a Change in Control
  
    
    all of Mr. Mozilos unvested performance-based restricted stock, stock options,
RSUs and SARs would have become vested and/or exercisable, except that only a pro rata portion of the RSUs granted in connection with his agreeing to remain
the Companys Chief Executive Officer would have vested (the vested portion would be
proportionate to the fraction of the employment term served); and
    
    Mr. Mozilo would have been entitled to receive a gross up payment equal to any
excise tax, plus any income and/or employment tax thereon,
 charged to him as a result of the above (with certain exceptions).
  
    
    a cash payment equal to three times his then-applicable base salary, plus a cash
payment equal to three times the greater of (i) the average bonus and/or incentive award
paid or payable for the two fiscal years preceding the year in which termination occurs
and (ii) the bonus and/or incentive award paid for the fiscal year preceding the change
in control;
    
    a pro rata percentage of his annual non-equity incentive compensation through the
date of termination;
    
    an enhanced amount under the SERP in a lump-sum cash payment (as opposed to being
paid out over fifteen years) (because Mr. Mozilo is currently eligible for retirement,
the value of any SERP benefits that he would have been entitled to receive is no greater
than what is included in the Pension Benefits table);
    
    for three years, continued health and life insurance benefits for Mr. Mozilo and
his beneficiaries;
    
    following those three years, health benefits for the lifetimes of Mr. Mozilo and
his spouse; and
    
    a gross-up payment equal to any excise tax, plus any income and/or employment tax thereon, charged to him as a result of his
receipt of any of the above (with certain exceptions).
  Payments to Mr. Mozilo Following His Term as Chief Executive Officer
    43




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##### Table of Contents



Covenants by Mr. Mozilo
  Estimated Payments to Mr. Mozilo Upon Termination or a Change in Control
  Cash
    
    Accelerated
    
    Vested
    
    Life
    
    Vested
    
    OtherSeverance
    
    Equity
    
    SERP
    
    Insurance
    
    Deferred
    
    BenefitsPayment
    
    Vesting
    
    Benefit
    
    Proceeds
    
    Compensation
    
    Continuation
    
    Total(1)(2)($)
    
    (1)(3)($)
    
    (1)(4)($)
    
    (1)(5)($)
    
    (1)(6)($)
    
    (1)(7)($)
    
    (1)($)Voluntary  With Good
Reason
    
    
    9,700,000
    
    
    
    1,679,924
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    103,872
    
    
    
    11,483,796Voluntary  Without
Good Reason or
Retirement (8) 
Normal
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Retirement (8)  Early
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/AInvoluntary  For Cause
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Involuntary  Without
Cause
    
    
    9,700,000
    
    
    
    1,679,924
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    103,872
    
    
    
    11,483,796Death
    
    
    1,900,000
    
    
    
    1,679,924
    
    
    
    
    
    
    
    13,895,761
    
    
    
    
    
    
    
    
    
    
    
    17,475,685Disability
    
    
    1,029,692
    
    
    
    1,679,924
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,339
    
    
    
    2,806,955Immediately following a
change in control
    
    
    
    
    
    
    1,679,924
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,679,924Involuntary  Without
Cause or Voluntary 
for any reason
following a change in
control
    
    
    67,084,419
    (9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    103,872
    
    
    
    67,188,291
 
 (1)
    
    Payments that have already accrued, vested or are not dependent on termination of employment
or a change in control have been omitted from the table.(2)
    
    Cash Severance Payment.Upon Mr. Mozilos voluntary termination with good reason, his
involuntary termination without cause (prior to or following a change in control), his
termination upon his disability or his death or his termination for any reason following a
change in control, he would have been entitled to receive a pro rata portion of his annual
non-equity incentive compensation based on time of service and annual performance. However,
because Mr.
Mozilo was not awarded an annual non-equity incentive payment for Fiscal 2007, he would not
have been entitled to receive such pro rata portion. 44




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##### Table of Contents



Based on Mr. Mozilos historical compensation and a cash severance payment upon termination
estimated as of December 31, 2007, Mr. Mozilos change in control benefits would not have been
subject to an excise tax and no gross-up payments would have been made.(3)
    
    Accelerated Equity Vesting.Values in the table represent gain on unvested RSUs that would
have become vested using the December 31, 2007 share price for our common stock ($8.94).(4)
    
    Vested SERP Benefit. Because Mr. Mozilo is currently eligible to retire, the value of any
SERP benefits that he would have received is no greater than what is included in the Pension
Benefits table. Consequently, no additional values are included here. However, upon Mr.
Mozilos death or immediately upon a change in control of the Company, the current,
accumulated present value of the benefits would be paid in a lump sum.(5)
    
    Life Insurance Proceeds. The amount is equal to life insurance proceeds payable following the
death of both Mr. Mozilo and his spouse, less premiums previously paid by the Company for such
insurance.(6)
    
    Vested Deferred Compensation. Mr. Mozilo is currently eligible to retire and, according to
the terms of the Companys Executive Deferred Compensation Plan, he is fully vested in all
Company contributions. The total value of Mr. Mozilos deferred compensation account can be
found in the Non-Qualified Deferred Compensation table.(7)
    
    Other Benefits Continuation. This column reflects estimated amounts for continuation of
benefits following termination. For voluntary termination with good reason, involuntary
termination without cause and termination for any reason following a change in control, the
amounts reflect three years of medical, dental and vision benefits, which
would have totaled $6,291 per year. For disability, the amount reflects two years of medical,
dental and vision benefits, which would have totaled $6,291 per year. The
amounts also include lifetime medical coverage continuation for Mr. Mozilo and his wife
following such two or three year period, which would have had an estimated total value of
$85,000.(8)
    
    Retirement. Mr. Mozilo is currently eligible for normal retirement. For purposes of these
termination scenarios, his voluntary termination without good reason and his retirement are
considered to be equivalent.(9)
    
    The cash severance payment reported is greater than the cash
severance payment Mr. Mozilo currently would be entitled to receive
(approximately $36.4 million) as a result of using different years to
calculate this payment. Mr. Mozilo has waived his right to receive
this payment upon consummation of the Companys planned
acquisition by Bank of America. Payments to Mr. Sambol
 Employment Agreement with Mr. Sambol
  Payments to Mr. Sambol upon Voluntary Termination (with and without Good Reason), Retirement and
Termination For Cause
  Payments to Mr. Sambol upon Termination Without Cause
  
    
    he would have been entitled to receive his base salary for a two-year severance
period (the severance period);
    
    he would have been entitled to receive a payment at the end of each fiscal year
during the severance period in an amount equal to the average of the incentive cash
bonus paid to him in the two calendar years immediately preceding the date of
termination;
    
    all of his unvested restricted stock, stock options, SARs, RSUs and other equity
incentive compensation awards would have become immediately vested and/or exercisable,
as applicable; and
    
    he and his beneficiaries would have been entitled to continue to receive health
and life insurance benefits for the severance period.
 Payments to Mr. Sambol upon Death or Disability
  
    
    upon Mr. Sambols death, his beneficiary would have been entitled to continue to
receive Mr. Sambols then-applicable base salary for a period of 12 months;
 45




---



##### Table of Contents




    
    upon Mr. Sambols death, his benefits under the SERP would have become
immediately vested and his beneficiary would have been entitled to receive a lump-sum
payment;
    
    upon Mr. Sambols death, his dependents would have been entitled to receive
payment for continuation health care coverage (i.e., COBRA coverage);
    
    upon Mr. Sambols death or termination upon his disability (as defined
thereunder), he would have been entitled to receive a pro rata portion of his annual
non-equity incentive compensation, based on time of service and annual performance;
    
    upon Mr. Sambols death or his termination upon his disability, all of his
unvested restricted stock, stock options SARs, RSUs and other equity incentive
compensation awards would have become immediately vested and/or exercisable, as
applicable;
    
    upon the termination of Mr. Sambols employment because of his disability, he
would have been entitled to continue to receive one-half of his then-applicable base
salary for the earlier of five years or his death (less any cash benefits he would have
received under the Companys disability plans and its Pension Plan);
    
    upon the termination of Mr. Sambols employment because of his disability, his
benefits under the SERP would have become immediately vested and he would have been
entitled to a fifteen year annuity;
    
    upon the termination of Mr. Sambols employment because of his disability, he and
his beneficiaries would have continued to receive health and life insurance benefits for
the earlier of five years or the date of Mr. Sambols death; and
    
    upon Mr. Sambols death or termination upon his disability, his unvested balance
under our Deferred Compensation Plan would have become immediately vested and he would
have been deemed to have elected payment of any amounts due him.
 Payments to Mr. Sambol upon a Change in Control
  
    
    all of Mr. Sambols unvested restricted stock, stock options, SARs, RSUs and
other equity incentive compensation awards would have become immediately vested;
    
    Mr. Sambols benefits under the SERP would have become immediately vested and he
would have been entitled to receive a lump-sum cash payment within 60 days of the change
in control;
    
    Mr. Sambols unvested balance under the Executive Deferred Compensation Plan
would have immediately vested and payment would have been made to him pursuant to the
plan; and
    
    Mr. Sambol would have received a gross-up payment equal to any excise tax, plus
any income and/or employment tax thereon, charged to him as a result of the above (with
certain exceptions).
  
    
    a cash payment equal to three times his then-applicable base salary;
    
    a cash payment equal to three times the greater of (i) the average non-equity
incentive compensation paid or payable for the two fiscal years preceding the year in
which termination occurs and (ii) the bonus and/or incentive award paid for the fiscal
year preceding the change in control;
    
    for three years, continued health and life insurance benefits for Mr. Sambol and
his dependents; and
    
    a gross-up payment equal to any excise tax, plus any income and/or employment
tax thereon, charged to him as a result of his receipt of any of the above (with certain
exceptions).
 Restrictions on Mr. Sambols Competition, Solicitation and Disclosure of Confidential Information
  46




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##### Table of Contents



Estimated Payments to Mr. Sambol Upon Termination or a Change in Control
  Cash
    
    Accelerated
    
    Vested
    
    Life
    
    Vested
    
    OtherSeverance
    
    Equity
    
    SERP
    
    Insurance
    
    Deferred
    
    BenefitsPayment
    
    Vesting
    
    Benefit
    
    Proceeds
    
    Compensation
    
    Continuation
    
    Total(1)(2)($)
    
    (1)(3)($)
    
    (1)(4)($)
    
    (1)($)
    
    (1)(5)($)
    
    (1)(6)($)
    
    (1)($)VoluntaryWith Good Reason
    
    
    
    
    
    
    840,303
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    840,303VoluntaryWithout Good Reason
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Retirement (7)Normal
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/ARetirement (7)Early
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/AInvoluntary For Cause
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    InvoluntaryWithout Cause
    
    
    13,300,000
    
    
    
    840,303
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,079
    
    
    
    14,169,382Death
    
    
    1,400,000
    
    
    
    840,303
    
    
    
    2,013,694
    
    
    
    5,100,000
    
    
    
    172,478
    
    
    
    14,540
    
    
    
    9,541,015Disability
    
    
    1,822,399
    
    
    
    840,303
    
    
    
    2,013,694
    
    
    
    
    
    
    
    172,478
    
    
    
    72,698
    
    
    
    4,921,572Immediately Following a Change in Control
    
    
    
    
    
    
    840,303
    
    
    
    2,013,694
    
    
    
    
    
    
    
    172,478
    
    
    
    
    
    
    
    3,026,475InvoluntaryWithout Cause or
VoluntaryWith Good Reason following a
Change in Control
    
    
    19,950,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43,619
    
    
    
    19,993,619
 
 (1)
    
    Payments that have already accrued, vested or are not dependent on termination of employment
have been omitted from the table above.(2)
    
    Cash Severance Payment. Upon Mr. Sambols
termination upon his disability or his death, he would have been entitled to receive a pro
rata portion of his annual non-equity incentive compensation based on time of service and
annual performance. However, because Mr. Sambol was not awarded an annual non-equity incentive
payment for Fiscal 2007, he would not have been entitled to receive such pro rata portion.
Based on Mr. Sambols historical compensation and his estimated cash severance payment upon
termination as of December 31, 2007, Mr. Sambols change in control benefits would not have
been subject to an excise tax and no gross-up payments would have been made.(3)
    
    Accelerated Equity Vesting. Values in the table represent gain on unvested RSUs that would
have become vested using the December 31, 2007 share price for our common stock ($8.94).(4)
    
    Vested SERP Benefit. Information in the table above represents the incremental value of the
benefit that exceeds the value already disclosed in the Pension Benefits table. These
incremental values are primarily due to accelerated vesting, specific benefit assumptions
defined in the SERP document and, in the case of death or a change in control, lump-sum
payment of the accrued benefit. Unvested contributions by the Company to the Executive
Deferred Compensation Plan offset any benefits Mr. Sambol may receive under the SERP.(5)
    
    Vested Deferred Compensation. Values in the table represent the otherwise unvested portion of
Mr. Sambols deferred compensation account as of December 31, 2007. This unvested amount is
attributable to our contributions to the Executive Deferred Compensation Plan. These values
are included in the balances provided in the Non-Qualified Deferred Compensation table.(6)
    
    Other Benefits Continuation. This column reflects estimated amounts for continuation of
benefits following termination. For involuntary termination without cause, the amount reflects
two years of medical, dental, vision and life insurance, which would have totaled $14,540 per
year. For death, the amount reflects one year of medical, dental, vision and life insurance.
For disability, the amount reflects five years of medical, dental, vision and life insurance,
which would have totaled $14,540 per year. For involuntary termination without cause or
voluntary termination with
good reason following a change in control, the amount reflects three years of medical, dental,
vision, life insurance and supplemental disability, which would have totaled $14,540 per year. 47




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##### Table of Contents



(7)
    
    Retirement. Mr. Sambol is not and would not have been eligible for either early or normal
retirement. Payments to Messrs. Sieracki, Garcia and Gissinger
  Payments upon Death or Disability
  
    
    the executive would have received a pro rata portion of his annual non-equity
incentive compensation;
    
    any unvested restricted stock, stock options or SARs granted to the executive
after November 9, 2004 would have become immediately vested pursuant to our 2000 Equity
Incentive Plans;
    
    for Messrs. Sieracki and Garcia, the executives benefits under the SERP would
have immediately vested, and upon his death, his beneficiary would have been entitled to
a lump-sum payment, or upon termination of his employment upon his disability, he would
have been entitled to a fifteen year annuity;
    
    for Mr. Gissinger, his benefits under our Executive Contribution Account Plan
would have immediately vested, and he or his beneficiary, as applicable, would have been
entitled to a lump-sum payment; and
    
    the executives unvested balance under the Executive Deferred Compensation Plan
would have immediately vested and amounts due him would have been paid in the form of a
lump sum or monthly annuities over five, ten or fifteen years, as elected by the
executive.
 Payments Made Upon a Change in Control
  
    
    any of the executives unvested restricted stock, stock options, RSUs or SARs would have become immediately vested and/or
exercisable, as applicable (for purposes of such vesting, as change in control is
defined in our 2000 or 2006 Equity Incentive Plans);
    
    for Messrs. Sieracki and Garcia, the executives benefits under the SERP would
have become immediately vested and he would have been entitled to receive a lump-sum
cash payment within 60 days of the change in control (for purposes of such vesting and
payment, as change in control is defined in the SERP);
    
    the executives unvested balance in the Executive Deferred Compensation
Plan would have become immediately vested and payment would have been made to the
executive pursuant to the plan (for purposes of such vesting and payment, as change in
control is defined in the Executive Deferred Compensation Plan);
    
    for Mr. Gissinger, his benefits under our Executive Contribution Account Plan
would have become immediately vested (for purposes of such
vesting, as change in control is defined in the Executive Contribution Account Plan);
and
    
    the executive would have received a gross up payment equal to the excise tax,
plus income and employment taxes thereon, charged to him as a result of his receipt of
any of the above (with certain exceptions).
  
    
    an amount equal to three times the executives annual base salary as of the date
of his termination, or, if greater, as of the date on which the change in control
occurs, in each case, paid over three years;
    
    an amount equal to three times the greater of the bonus and/or incentive award
paid to the executive for the fiscal year immediately preceding the change in control
and the average of the bonus and/or incentive award paid to the executive for each of
the last two fiscal years preceding the year of termination paid over three years;
    
    continued benefits for the executive and his dependents or beneficiaries,
including group medical, health, dental and prescription drug benefits (including the
executive medical examination program), life insurance and other
death benefits coverage, executive long-term disability, individual outplacement services,
and financial planning services for a period of three years;
 48




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##### Table of Contents




    
    a credit for three additional years of service and age under all of our employee
benefit plans; and
    
    a gross-up payment equal to the excise tax, plus income and employment taxes
thereon, charged to the executive as a result of his receipt of any of the above (with
certain exceptions).
  Estimated Payments to Mr. Sieracki Upon Termination or a Change in Control
  Cash
    
    Accelerated
    
    Vested
    
    Life
    
    Vested
    
    OtherSeverance
    
    Equity
    
    SERP
    
    Insurance
    
    Deferred
    
    BenefitsPayment
    
    Vesting
    
    Benefit
    
    Proceeds
    
    Compensation
    
    Continuation
    
    Total(1)(2)($)
    
    (1) (3)($)
    
    (1)(4)($)
    
    (1)($)
    
    (1)(5)($)
    
    (1)(6)($)
    
    (1)($)Death
    
    
    
    
    
    
    328,439
    
    
    
    842,926
    
    
    
    3,005,000
    
    
    
    174,115
    
    
    
    
    
    
    
    4,350,480Disability
    
    
    
    
    
    
    328,439
    
    
    
    842,926
    
    
    
    
    
    
    
    174,115
    
    
    
    
    
    
    
    1,345,480Immediately Following a Change in Control
    
    
    
    
    
    
    328,439
    
    
    
    842,926
    
    
    
    
    
    
    
    174,115
    
    
    
    
    
    
    
    1,345,480InvoluntaryWithout Cause or
VoluntaryWith Good Reason following a
Change in Control
    
    
    9,070,845
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    67,736
    
    
    
    9,138,581
 
 (1)
    
    Payments that have already accrued, vested or are not dependent on termination of employment
have been omitted from the table above.(2)
    
    Cash Severance Payment. Upon Mr. Sierackis termination upon his disability or his death, he
would have been entitled to receive a pro rata portion of the annual non-equity incentive
compensation based on time of service and annual performance. However, because Mr. Sieracki
was not awarded an annual non-equity incentive payment for Fiscal 2007, he would not have been
entitled to receive such pro rata portion.The estimated value of Mr. Sierackis gross-up payment upon a specified termination of his
employment following a change in control (including both reimbursement for any excise tax and
associated taxes on that payment) is $4,107,570 and is included in the cash severance benefit
above. The gross-up amount in the above table is based on an excise tax rate of 20%, a 35%
federal income tax rate, a 1.45% Medicare tax rate and a 9.30% state income tax rate.(3)
    
    Accelerated Equity Vesting. Values in the table represent gain on unvested RSUs that would
have become vested using the December 31, 2007 share price for our common stock ($8.94).(4)
    
    Vested SERP Benefit. Information in the table above represents the incremental value of the
benefit that exceeds the value already disclosed in the Pension Benefits table. These
incremental values are primarily due to accelerated vesting, specific benefit assumptions
defined in the SERP document and, in the case of death or a change in control, lump-sum
payment of the accrued benefit. Unvested contributions by the Company to the Executive
Deferred Compensation Plan offset any benefits Mr. Sieracki may receive under the SERP.(5)
    
    Vested Deferred Compensation. Values in the table represent the otherwise unvested portion of
Mr. Sierackis deferred compensation account as of December 31, 2007. This unvested amount is
attributable to our contributions to the Executive Deferred Compensation Plan. These values
are included in the balances provided in the Non-Qualified Deferred Compensation table.(6)
    
    Other Benefits Continuation. This column reflects estimated amounts for continuation of
benefits following termination. For involuntary termination without cause or voluntary
termination with good reason following a change in control, the amount reflects three years of
medical, dental, vision, life insurance, supplemental disability
and outplacement, which would have totaled
$22,579 per year. Estimated Payments to Mr. Garcia Upon Termination or a Change in Control
  49




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##### Table of Contents



Cash
    
    Accelerated
    
    Vested
    
    Life
    
    Vested
    
    OtherSeverance
    
    Equity
    
    SERP
    
    Insurance
    
    Deferred
    
    BenefitsPayment
    
    Vesting
    
    Benefit
    
    Proceeds
    
    Compensation
    
    Continuation
    
    Total(1)(2)($)
    
    (1)(3)($)
    
    (1)(4)($)
    
    (1)($)
    
    (1)(5)($)
    
    (1)(6)($)
    
    (1)($)Death
    
    
    
    
    
    
    187,679
    
    
    
    1,077,077
    
    
    
    5,100,000
    
    
    
    288,295
    
    
    
    
    
    
    
    6,653,051Disability
    
    
    
    
    
    
    187,679
    
    
    
    1,077,077
    
    
    
    
    
    
    
    288,295
    
    
    
    
    
    
    
    1,553,051Immediately Following a Change in Control
    
    
    
    
    
    
    187,679
    
    
    
    1,077,077
    
    
    
    
    
    
    
    288,295
    
    
    
    
    
    
    
    1,553,051Involuntary  Without Cause or
Voluntary  With Good Reason following
a Change in Control
    
    
    11,164,317
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    164,725
    
    
    
    11,329,042
 
 (1)
    
    Payments that have already accrued, vested or are not dependent on termination of employment
have been omitted from the table above.(2)
    
    Cash Severance Payment. Upon Mr. Garcias termination upon his disability or his death, he
would have been entitled to receive a pro rata portion of the annual non-equity incentive
compensation based on time of service and annual performance. However, because Mr. Garcia was
not awarded an annual non-equity incentive payment for Fiscal 2007, he would not have been
entitled to receive such pro rata portion.Based on Mr. Garcias historical compensation and a cash severance payment upon termination
estimated as of December 31, 2007, Mr. Garcias change in control benefits would not be subject
to the excise tax and no gross-up payments would be made.(3)
    
    Accelerated Equity Vesting. Values in the table represent gain on unvested RSUs that would
have become vested using the December 31, 2007 share price for our common stock ($8.94).(4)
    
    Vested SERP Benefit. Information in the table above represents the incremental value of the
benefit that exceeds the value already disclosed in the Pension Benefits table. These
incremental values are primarily due to accelerated vesting, specific benefit assumptions
defined in the SERP document and, in the case of death or a change in control, lump-sum
payment of the accrued benefit. Unvested contributions by the Company to the Executive
Deferred Compensation Plan offset any benefits Mr. Garcia may receive under the SERP.(5)
    
    Vested Deferred Compensation. Amounts in the table represent the otherwise unvested portion
of Mr. Garcias deferred compensation account as of December 31, 2007. This unvested amount is
attributable to our contributions to the Executive Deferred Compensation Plan. These amounts
are included in the balances provided in the Non-Qualified Deferred Compensation table.(6)
    
    Other Benefits Continuation. This column reflects estimated amounts for continuation of
benefits following termination. For involuntary termination without cause or voluntary
termination with good reason following a change in control, the amount reflects three years of
medical, dental, vision, life insurance, supplemental disability,
financial planning and outplacement, which
would have totaled $54,908 per year. Estimated Payments to Mr. Gissinger Upon Termination or a Change in Control
  VestedExecutiveCash
    
    Accelerated
    
    Contribution
    
    Life
    
    Vested
    
    OtherSeverance
    
    Equity
    
    Account
    
    Insurance
    
    Deferred
    
    BenefitsPayment
    
    Vesting
    
    Plan Benefit
    
    Proceeds
    
    Compensation
    
    Continuation
    
    Total(1)(2)($)
    
    (1)(3)($)
    
    (1)(4)($)
    
    (1)($)
    
    (1)(5)($)
    
    (1)(6)($)
    
    ($)Death
    
    
    
    
    
    
    1,519,248
    
    
    
    223,434
    
    
    
    3,100,000
    
    
    
    
    
    
    
    
    
    
    
    4,842,682Disability
    
    
    
    
    
    
    1,519,248
    
    
    
    223,434
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,742,682Immediately Following a Change in Control
    
    
    
    
    
    
    1,519,248
    
    
    
    223,434
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,742,682Involuntary  Without Cause or
Voluntary  With Good Reason following
a Change in Control
    
    
    15,303,501
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    147,109
    
    
    
    15,450,610
 50




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##### Table of Contents



(1)
    
    Payments that have already accrued, vested or are not dependent on termination of employment
have been omitted from the table above.(2)
    
    Cash Severance Payment. Upon Mr. Gissingers termination upon his disability or his death, he
would have been entitled to receive a pro rata portion of the annual non-equity incentive
compensation based on time of service and annual performance. However, because Mr. Gissinger
was not awarded an annual non-equity incentive payment for Fiscal 2007, he would not have been
entitled to receive such pro rata portion.The estimated value of Mr. Gissingers gross-up payment upon a specified termination of his
employment following a change in control (including both reimbursement for any excise tax and
associated taxes on that payment) is $6,852,972 and is included in the cash severance amount
above. The gross-up amount in the above table is based on an excise tax rate of 20%, a 35%
federal income tax rate, a 1.45% Medicare tax rate and a 9.30% state income tax rate.(3)
    
    Accelerated Equity Vesting. Values in the table represent gain on unvested RSUs that would
have become vested using the December 31, 2007 share price for our common stock ($8.94).(4)
    
    Vested Executive Contribution Account Plan Benefit. As previously described, Mr. Gissinger
participates in our Executive Contribution Account Plan; he does not participate in the SERP.
Upon a change in control, any unvested Executive Contribution Account Plan balance is
immediately vested. As of December 31, 2007, Mr. Gissingers entire Executive Contribution
Account Plan account balance was unvested. This value is also disclosed in the Pension
Benefits table.(5)
    
    Vested Deferred Compensation. Mr. Gissinger is
fully vested in his Executive Deferred Compensation Plan
balance, which consists entirely of his voluntary deferrals.(6)
    
    Other Benefits Continuation. This column reflects estimated amounts for continuation of
benefits following termination. For involuntary termination without cause or voluntary
termination with good reason following a change in control, the amount reflects three years of
medical, dental, vision, life insurance, supplemental disability, executive physical and
financial planning and outplacement, which would have totaled $49,036 per year. Bank of America Acquisition
  51




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##### Table of Contents



DIRECTOR COMPENSATION AND BENEFITS
  Cash Compensation Paid to Board Members
  Type of Fee
    
    Amount ($)Annual Board Retainer
    
    $
    70,000Annual Committee Chair Retainer.
    
    $
    7,500Lead Director Retainer
    
    $
    25,000
    
    (may be paid in the form of restricted stock)Meeting FeesIn-Person Board Meeting
    
    $
    1,500Telephonic Board Meeting
    
    $
    750
  Restricted Stock Awards
  Deferred Compensation Program for Non-Employee Directors
  Ms. Brown
    
    Mr. Cisneros
    
    Mr. Cunningham
    
    Mr. Donato
    
    Mr. Dougherty
    
    Mr. Melone
    
    Mr. Parry
    
    Mr. Robertson
    
    Mr. Russell
    
    Mr. Snyder$ 0
    
    $
    0
    
    
    $
    839,648
    
    
    $
    1,201,149
    
    
    $
    0
    
    
    $
    117,835
    
    
    $
    181,778
    
    
    $
    622,748
    
    
    $
    0
    
    
    $
    567,480
  Director Charitable Award Program and Matching Gift Program
  52




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##### Table of Contents



Director Emeritus
    53




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##### Table of Contents



Director Summary Compensation Table
  Change in PensionValue andFees
    
    
    
    
    
    NonqualifiedEarned
    
    
    
    
    
    Deferredor Paid
    
    Stock
    
    Compensation
    
    All OtherName
    
    in Cash
    
    Awards
    
    Earnings
    
    Compensation
    
    Total(1)
    
    ($)
    
    ($)(2)(3)(4)
    
    ($)(5)
    
    ($)(6)
    
    ($)Kathleen Brown (7)
    
    
    24,250
    
    
    
    (164,377
    )
    
    
    
    
    
    
    251,662
    
    
    
    111,535Henry G. Cisneros
    
    
    79,537
    
    
    
    55,598
    
    
    
    
    
    
    
    55,461
    
    
    
    190,596Jeffrey M. Cunningham
    
    
    104,121
    
    
    
    275,577
    
    
    
    1,394
    
    
    
    57,078
    
    
    
    438,170Robert J. Donato
    
    
    109,750
    
    
    
    219,978
    
    
    
    3,178
    
    
    
    58,640
    
    
    
    391,546Michael E. Dougherty
    
    
    54,431
    (8)
    
    
    219,978
    
    
    
    971
    
    
    
    47,377
    
    
    
    322,757Martin R. Melone
    
    
    176,000
    (9)
    
    
    275,947
    
    
    
    
    
    
    
    50,377
    
    
    
    502,324Robert T. Parry
    
    
    177,921
    (9)
    
    
    275,947
    
    
    
    
    
    
    
    57,377
    
    
    
    511,245Oscar P. Robertson
    
    
    95,500
    (10)
    
    
    219,978
    
    
    
    1,449
    
    
    
    47,377
    
    
    
    364,304Keith P. Russell
    
    
    182,500
    (9)
    
    
    345,696
    
    
    
    
    
    
    
    58,392
    
    
    
    586,588Harley W. Snyder
    
    
    185,649
    (9)
    
    
    275,947
    
    
    
    1,495
    
    
    
    52,334
    
    
    
    515,424
 
 (1)
    
    Angelo R. Mozilo, the Companys Chairman of the Board and Chief Executive Officer, and David
Sambol, the President and Chief Operating Officer of the Company, are not included in this
table because they are employees of the Company and thus receive no compensation for their
services as directors. The compensation received by Messrs. Mozilo and Sambol as employees of
the Company for Fiscal 2007 and Fiscal 2006 is shown in the Summary Compensation Table.(2)
    
    The amounts in this column reflect the dollar amount recognized for financial statement
reporting purposes for Fiscal 2007 in accordance with FAS 123R and thus may include amounts
from awards granted in and prior to Fiscal 2007.The grant date fair value of restricted stock awards granted April 2, 2007 computed in
accordance with FAS 123R is as follows: for each of Messrs. Cunningham, Donato, Dougherty
and Robertson: $219,978; and for each of Messrs. Melone, Parry, Russell and Snyder: $275,947,
of which $219,978 is attributed to restricted stock awarded to each for his service as a
director and $55,968 is attributed to restricted stock awarded to each for his service as a
director of Countrywide Bank, FSB (the Bank), a subsidiary of the Company.Mr. Cisneros resigned from the Board effective October 18, 2007, which resulted in the
forfeiture of his April 2, 2007 restricted stock award, so the value reported only reflects
amounts from awards granted prior to Fiscal 2007.Ms. Brown resigned from the Board effective March 29, 2007, and as a result, she was not
granted a stock award on April 2, 2007. In addition, upon Ms. Browns resignation from the
Board, she forfeited 6,035 shares of restricted stock. The amount previously reported in this
column for Ms. Brown for Fiscal 2006 included the dollar amount recognized for financial
statement reporting purposes for such restricted stock in accordance with FAS 123R. The
negative number reported in this column for Fiscal 2007 reflects the negative expense
recognized for financial statement reporting purposes with respect to the forfeiture of such
restricted stock in accordance with FAS 123R.(3)
    
    The amounts of restricted stock underlying the awards granted April 2, 2007 that vested on
April 1, 2008 are as follows: for each of Messrs. Cunningham, Donato, and Robertson: 6,721
restricted shares; and for each of Messrs. Melone, Parry, Russell and Snyder: 8,431 restricted
shares.Mr. Cisneros forfeited 6,721 shares of restricted stock upon his resignation.Mr. Dougherty did not stand for re-election as a director at our 2007 annual meeting.
Accordingly his service as a director terminated effective June 13, 2007. In lieu of Mr.
Doughertys participation in our Director Emeritus program, the Board resolved on June 13, 2007
to accelerate the vesting of 6,721 shares of restricted stock awarded to Mr. Dougherty that
would have been forfeited upon the termination of his service absent such acceleration.(4)
    
    Messrs. Cunningham, Dougherty, Melone and Parry elected to defer 100% of their restricted
stock awards for Fiscal 2007 attributable to their services as directors. Any restricted
stock attributable to their services as Bank directors was not eligible for deferral.(5)
    
    All of the amounts reflect above-market earnings on compensation deferred by the directors
pursuant to our 2003 Non-Employee Directors Fee Plan. 54




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##### Table of Contents



(6)
    
    The amounts in this column reflect perquisites and other personal benefits (including health benefits and
spousal travel), contributions by the Company to qualified charities pursuant to our
Charitable Awards Program, and charitable donations by the Company pursuant to our Directors
Matching Gift Program.Health Benefits: In Fiscal 2007, Messrs. Cisneros, Cunningham, Donato and Russell participated
in the Companys group health plans consisting of medical and dental benefits. The annual cost
to the Company in Fiscal 2007 for each participating director, net of premium payments made by
the director, was $8,084, $9,701, $6,263, and $6,015, respectively.Spousal Travel: The annual cost to the Company for spousal travel of directors in Fiscal 2007
was as follows: for Mr. Snyder, $4,957.Charitable Awards Program: We fund the Charitable Award Program through life insurance
policies and $47,377 is allocated as All Other Compensation for each director for Fiscal
2007. Such amount was determined by dividing the aggregate life insurance premiums by 14, which
was the number of current and former directors, including Directors Emeritus and Mr. Mozilo
(but not including Mr. Sambol) for Fiscal 2007. On June 13, 2007, the Board amended the
Companys Charitable Award Program to limit participation in the program to then-current
participants.Matching Gift Program: During Fiscal 2007, $23,000 was paid out under the Directors Matching
Gift Program as follows: Director
    
    Matching Contribution ($)Robert J. Donato
    
    
    5,000Martin R. Melone
    
    
    3,000Robert T. Parry
    
    
    10,000Keith P. Russell
    
    
    5,000
  (7)
    
    Ms. Brown resigned from the Board effective March 29, 2007, which resulted in the forfeiture
of 6,035 shares of restricted stock that would have vested on April 2, 2007. Because Ms. Brown
had served as a director for substantially all of the vesting period for these shares, the
Compensation Committee and the Board approved a cash payment to Ms. Brown of $204,285 in lieu
thereof, which was the value on March 29, 2007 of the 6,035 shares that were forfeited. Ms.
Brown elected to convert $24,221 of her Fiscal 2007 cash compensation (totaling $228,535) into
stock and to defer such stock. Stock in Ms. Browns deferral account was distributed to her at
the time of her separation from the Board.(8)
    
    Mr. Dougherty elected to defer $31,622 of his Fiscal 2007 cash compensation into a deferred
cash account.(9)
    
    Fees include additional cash compensation received by the director as a member of the Board
of Directors of the Bank. In Fiscal 2007, Messrs. Melone, Parry, Russell and Snyder earned
$67,750, $66,500, $73,500 and $65,000, respectively, for their service on the Banks Board of
Directors. The annual retainer for a member of the Banks Board of Directors is $50,000 and
the annual committee chair retainer is $5,000. Meeting fees are $1,500 for each in-person Bank
Board meeting and $1,000 for each telephonic Bank Board meeting. Each member of the Bank Board
of Directors also received restricted stock with a fair market value of $55,968 in Fiscal
2007, rounded down to the next whole share. Effective January 1, 2008, a director who is also
a member of the Board of Directors of the Bank will no longer be compensated for service on
both boards of directors, except that such directors will be entitled to receive a meeting fee
of $750 if a telephonic meeting of the Bank Board is not held on the same day as a Board
meeting and a meeting fee of $1,500 if an in-person meeting of the Bank Board is not held on
the same day as a Board meeting.(10)
    
    Mr. Robertson elected to defer $85,950 of his Fiscal 2007 cash compensation into a deferred
cash account. 55




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##### Table of Contents



Item 12.   
Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
 
 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
  Number of SharesName and Address of Beneficial Owner
    
    Owned
    
    Percent of Class (1)Bank of America, N.A. (2)
    
    
    111,111,111
    
    
    
    16.1
    %Bank of America Corporate Center
100 North Tryon Street
Charlotte, NC 28255Legg Mason Capital Management, Inc. (3)
    
    
    68,136,544
    
    
    
    11.8
    %100 Light Street
Baltimore, MD 21202Brandes Investment Partners, L.P. (4)
    
    
    55,323,828
    
    
    
    9.6
    %11988 El Camino Real, Suite 500
San Diego, CA 92130Capital World Investors (5)
    
    
    35,836,620
    
    
    
    6.1
    %333 South Hope Street
Los Angeles, CA 90071SRM Global Master Fund Limited Partnership (6)
    
    
    31,717,524
    
    
    
    5.4
    %c/o SRM Fund Management (Cayman) Limited
P.O. Box 309 GT, Ugland House
South Church Street, George Town
Grand Cayman, Cayman IslandsFMR LLC (7)
    
    
    31,397,873
    
    
    
    5.4
    %82 Devonshire Street
Boston, MA 02109
 
 (1)
    
    The percent of class reported in this column has been calculated based upon the number of
shares of common stock outstanding as of December 31, 2007 and may be different than the
percent of class reported in statements of beneficial ownership filed with the SEC.(2)
    
    Consists of 20,000 shares of the Companys 7.25% Series B Non-Voting Convertible Preferred
Stock, which Preferred Stock is convertible, at any time at the option of the holder, into the
number of shares of common stock of the Company equal to the liquidation preference of the
Series B Non-Voting Convertible Preferred Stock (currently equal
to $100,000 per share) being
converted divided by the conversion price (currently equal to $18.00 per share), as more fully
described in the Companys Current Report on Form 8-K filed with the SEC on August 28, 2007.(3)
    
    As reported in Amendment No. 3 to Schedule 13G filed with the SEC on February 14, 2008 by
Legg Mason Capital Management, Inc., an investment adviser (Legg Mason) and LMM LLC, an
investment adviser (LMM). In the Schedule 13G, Legg Mason and LMM disclosed that they are
investment advisers that manage various accounts that have the right to receive or the power
to direct the receipt of dividends from, or the proceeds from the sale of, the shares. Legg
Mason and LMM reported that they have shared voting and dispositive power as to 68,136,544
shares. 56




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##### Table of Contents



(4)
    
    As reported in a Schedule 13G filed with the SEC on February 14, 2008 by Brandes Investment
Partners, L.P., an investment advisor, Brandes Investment Partners, Inc., a control person,
Brandes Worldwide Holdings, L.P., a control person, Charles H. Brandes, a control person,
Glenn R. Carlson, a control person, and Jeffrey A. Busby, a control person (collectively, the
Brandes reporting entities). In the Schedule 13G, the Brandes reporting entities disclosed
shared voting power as to 45,547,406 shares and shared dispositive power as to 55,323,828
shares.(5)
    
    As reported in a Schedule 13G filed with the SEC on February 11, 2008 by Capital World
Investors (CWI), a division of Capital Research and Management Company, an investment
advisor. In the Schedule 13G, CWI disclosed that one or more of its clients have the right to
receive or the power to direct the receipt of dividends from, or the proceeds from the sale
of, the shares. CWI reported that it has sole voting power as to 84,065,000 shares and sole
dispositive power as to 35,836,620 shares. Includes 4,577,620 shares that may be issued upon
conversion of $240,000,000 principal amount of series A floating rate convertible debentures
within 60 days of April 4, 2008.(6)
    
    As reported in Amendment No. 1 to Schedule 13D filed with the SEC on February 13, 2008 by (a)
SRM Global Master Fund Limited Partnership (the Master Fund), an exempted limited
partnership; (b) SRM Global Fund General Partner Limited (the General Partner), an exempted
company serving as the general partner of the Master Fund; (c) SRM Fund Management (Cayman)
Limited (the Investment Manager), an exempted company serving as the investment manager of
the Master Fund; and (d) Jonathan Wood, a director and principal of the Investment Manager
(collectively, the SRM Reporting Persons). The SRM Reporting Persons disclosed shared
voting and dispositive power as to 31,717,524 shares. On April 16, 2008, the SRM Reporting
Persons filed Amendment No. 2 to Schedule 13D with the SEC reporting beneficial ownership of
47,217,524 shares as of April 15, 2008, which includes 1,688,600 shares underlying 16,886
exchange traded put options that were sold by the Master Fund in open market transactions.(7)
    
    As reported in a Schedule 13G filed with the SEC on February 14, 2008 by FMR LLC, a parent
holding company, and its direct and indirect subsidiaries FMR LLC, and Edward C. Johnson 3d,
Chairman of FMR LLC. In the Schedule 13G, Fidelity Management & Research Company
(Fidelity), a wholly-owned subsidiary of FMR LLC and a registered investment adviser,
reported that it is the beneficial owner of 29,743,952 shares as a result of acting as
investment adviser to various registered investment companies. Edward C. Johnson 3d and FMR
LLC, through control of Fidelity and certain funds (the Funds), each has sole power to
dispose of the 29,743,952 shares owned by the Funds. 1,913 shares are beneficially owned by
Strategic Advisers, Inc., a wholly-owned subsidiary of FMR LLC and a registered investment
adviser, as a result of its providing investment advisory services to individuals. 24,000
shares are beneficially owned by Pyramis Global Advisors, LLC (PGALLC), an indirect
wholly-owned subsidiary of FMR LLC and a registered investment adviser, as a result of its
serving as investment adviser to institutional accounts, non-U.S. mutual funds, or registered
investment companies owning such shares. Edward C. Johnson 3d and FMR LLC, through its
control of PGALLC, each has sole dispositive power over 24,000 shares and sole power to vote
or to direct the voting of 24,000 shares owned by the institutional accounts or funds advised
by PGALLC as reported above. 1,222,613 shares are beneficially owned by Pyramis Global
Advisors Trust Company (PGATC), an indirect wholly-owned subsidiary of FMR LLC and a bank,
as a result of its serving as investment manager of institutional accounts owning such shares.
Edward C. Johnson 3d and FMR LLC, through its control of Pyramis Global Advisors Trust
Company, each has sole dispositive power over 1,222,613 shares and sole power to vote or to
direct the voting of 1,060,417 shares owned by the institutional accounts managed by PGATC.
405,395 shares are beneficially owned by Fidelity International Limited (FIL), a qualified
institution, and various foreign-based subsidiaries, as a result of providing investment
advisory and management services to a number of non-U.S. investment companies and certain
institutional investors. FIL has sole dispositive power over 405,395 shares owned by the
related international funds and sole power to vote or direct the voting of 364,995 shares and
no power to vote or direct the voting of 40,400 shares held by the related international
funds. The address of Fidelity and Strategic Advisors, Inc. is 82 Devonshire Street, Boston,
Massachusetts 02109. The address of PGALLC and PGATC is 53 State Street, Boston, MA 02109.
The address of FIL is Pembroke Hall, 42 Crow Lane, Hamilton, Bermuda. 57




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##### Table of Contents



SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
  Number of
    
    ExercisableShares
    
    Stock
    
    
    
    
    
    Percent ofName or Group
    
    Owned(1)
    
    Options(2)
    
    Total
    
    Class(3)(%)Named Executive OfficersAngelo R. Mozilo
    
    
    1,223,665
    (4)
    
    
    5,672,074
    
    
    
    6,895,739
    
    
    
    1.2
    %Eric P. Sieracki
    
    
    182,482
    (5)
    
    
    504,328
    
    
    
    686,810
    
    
    
    David Sambol
    
    
    75,278
    (5)
    
    
    2,810,984
    
    
    
    2,886,262
    
    
    
    Carlos M. Garcia
    
    
    507,401
    (5)
    
    
    1,053,656
    
    
    
    1,561,057
    
    
    
    Andrew Gissinger III
    
    
    1,857
    (5)
    
    
    549,466
    
    
    
    551,323
    
    
    
    Non-Employee DirectorsJeffrey M. Cunningham
    
    
    158,180
    
    
    
    72
    
    
    
    158,252
    
    
    
    Robert J. Donato
    
    
    189,647
    (6)
    
    
    189,404
    
    
    
    379,051
    
    
    
    Martin R. Melone
    
    
    68,222
    (7)
    
    
    
    
    
    
    68,222
    
    
    
    Robert T. Parry
    
    
    61,430
    
    
    
    
    
    
    
    61,430
    
    
    
    Oscar P. Robertson
    
    
    66,179
    
    
    
    
    
    
    
    66,179
    
    
    
    Keith P. Russell
    
    
    66,525
    
    
    
    
    
    
    
    66,525
    
    
    
    Harley W. Snyder
    
    
    125,301
    
    
    
    
    
    
    
    125,301
    
    
    
    All Directors and executive
officers as a group (19 persons)
    
    
    2,993,179
    
    
    
    12,792,428
    
    
    
    15,785,607
    
    
    
    2.6
    %
 
 (1)
    
    Excludes outstanding, stock-settled RSUs and associated dividend equivalents
as follows: for
Mr. Mozilo, 1,163,874; for Mr. Sieracki, 37,611; for Mr. Sambol, 1,543,174;
for Mr. Garcia,
21,492; and for Mr. Gissinger, 21,492. Includes the following
vested and deferred stock units: for
Mr. Mozilo, 79,138, for Mr. Cunningham, 33,485, for Mr. Melone, 13,494,
for Mr. Parry, 20,816
and for Mr. Snyder, 6,070. Includes 35,369 shares of restricted
stock held by Messrs. Donato,
Robertson, Russell and Snyder. Includes the 35,369 unvested deferred
RSUs for Messrs.
Cunningham, Melone and Parry.(2)
    
    Represents shares subject to stock options and SARs that were exercisable on April 4, 2008 or
will become exercisable within 60 days of April 4, 2008.(3)
    
    Percentage information is omitted for individuals who own less than one percent of the
outstanding shares of the common stock and shares deemed outstanding due to exercisable
options and SARs. There were 583,344,170 shares of the Companys common stock outstanding at
the close of business on April 4, 2008.(4)
    
    Includes 126,999 shares for The Mozilo Family Foundation. Mr. Mozilo has no pecuniary
interest in the foundations shares and disclaims beneficial ownership of those shares. The
number of shares reported also includes 2,892 shares owned by Phyllis Mozilo, wife of Mr.
Mozilo, as to which Mr. Mozilo disclaims beneficial ownership. Mr. Mozilo shares voting and
dispositive power with respect to 215,166 shares owned by The Mozilo Living Trust. The number
of shares reported also includes 764,889 shares held in the Companys 401(k) Plan  and 25,000 shares in a Grantor Retained Annuity Trust.(5)
    
    Includes 14,024, 11,930, 41,565 and 1,857 shares held in our 401(k) Plan by Messrs. Sieracki,
Sambol, Garcia and Gissinger, respectively.(6)
    
    Mr. Donato has pledged 111,000 shares as security.(7)
    
    Mr. Melone shares voting and dispositive power with respect to 17,650 shares owned by The
Melone Family Trust. 58




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CHANGE IN CONTROL TRANSACTIONS
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Item 13.   
Certain Relationships and Related Transactions, and Director
Independence
 
 CERTAIN RELATIONSHIPS AND TRANSACTIONS
 Policies and Procedures with Respect to Related Person Transactions
   
    
    an executive officer, director or director nominee of the Company;
    
    any person who is known to be the beneficial owner of more than 5% of the
Companys common stock;
    
    any person who is an immediate family member (as defined in the rules and
regulations of the SEC) of an executive officer, director or director nominee or
beneficial owner of more than 5% of the Companys common stock; and
    
    any firm, corporation or other entity in which any of the foregoing persons is
employed or is a partner or principal or in a similar position or in which such person,
together with any other of the foregoing persons, has a 5% or greater beneficial
ownership interest.
   
    
    any employment by the Company of a relative of an executive officer where the
employment was entered into in the ordinary course of business and the relatives
compensation is in accordance with the Companys practices applicable to employees with
equivalent qualifications and responsibilities holding similar positions;
    
    any transaction with another company where the related persons only relationship
is as an employee (but not an executive officer), director or beneficial owner of less
than 10% of that companys shares and the aggregate amount involved does not exceed the
lesser of $200,000 or two percent of that companys total annual revenues;
    
    any charitable contribution, grant or endowment by the Company to a charitable
organization, foundation or university where the related persons only relationship is
as an employee or a director (but not an executive officer) and the aggregate amount
involved does not exceed the lesser of $200,000 or two percent of the charitable
organizations total annual receipts;
    
    any transaction where the related persons interest arises solely from the
ownership of the Companys common stock and all holders of such common stock receive the
same benefit on a pro rata basis (e.g., dividends); and
    
    any transaction with a related person involving services, products or
relationships provided by the Company in the ordinary course of business on arms length
terms available to third parties.
  Relationships and Transactions
  60




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Board Independence
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www.countrywide.com .
  62




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Item 14.   
Principal Accountant Fees and Services
 
 AUDITOR FEES AND SERVICES
 KPMG Fees
  2007
    
    
    2006Audit Fees(1)
    
    $
    14,836,000
    
    
    $
    13,759,148Audit-Related Fees(2)
    
    
    4,445,410
    
    
    
    6,586,108Tax Fees(3)
    
    
    
    
    
    
    All Other Fees(4)
    
    
    
    
    
    
    Total
    
    $
    19,281,410
    
    
    $
    20,345,256
 
 (1)
    
    These are fees paid for professional services rendered during the audit of the Companys
annual consolidated financial statements, for audits of internal controls and for the reviews
of the consolidated financial statements included in the Companys quarterly reports on Form
10-Q and for services normally provided in connection with statutory or regulatory filings or
engagements and comfort letters related to debt and equity offerings.(2)
    
    These are fees paid for assurance and related services reasonably related to the performance
of the audit and review of our consolidated financial statements that are not reported under
Audit Fees, including fees relating to agreed-upon procedures related to securitization
transactions, audits of financial statements of employee benefit plans and internal control reports.(3)
    
    These would include fees paid for professional services rendered for tax compliance, tax
planning and tax advice.(4)
    
    These would include fees paid for permissible work performed by KPMG that does not fall into
the above categories.  63




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INCORPORATION
BY REFERENCE
  
 DISCLAIMER
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SIGNATURES
  Countrywide Financial CorporationBy:

/s/
Angelo R. MoziloAngelo R. MoziloChairman of the Board and Chief
Executive Officer  65




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COUNTRYWIDE FINANCIAL CORPORATION
 FORM 10-K/A
December 31, 2007
 INDEX OF EXHIBITS
 Exhibit No.
    
    Description31.1
    
    Certification of Chief Executive Officer Pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.