Document:

exv10w16

 

    Exhibit
    10.16

 

    FEDERAL
    HOME LOAN MORTGAGE CORPORATION

    EMPLOYEE STOCK PURCHASE PLAN

 

    As
    Amended and Restated

 

    Effective
    January 1, 2005

 

    TABLE OF
    CONTENTS

 

	 	 	 	 	 
	
 
	
 
	
 
	
 
	

    Page

	 

	

    ARTICLE I  Establishment of the Plan

	
 
	
    1

	

    1.1

	
 
	

    Purpose

	
 
	
    1

	

    1.2

	
 
	

    Effective Date

	
 
	
    1

	

    1.3

	
 
	

    Name

	
 
	
    1

	

    ARTICLE II  Definitions

	
 
	
    1

	

    2.1

	
 
	

    Board

	
 
	
    1

	

    2.2

	
 
	

    Compensation

	
 
	
    1

	

    2.3

	
 
	

    Committee

	
 
	
    1

	

    2.4

	
 
	

    Custodian

	
 
	
    2

	

    2.5

	
 
	

    Eligible Employee

	
 
	
    2

	

    2.6

	
 
	

    Employee

	
 
	
    2

	

    2.7

	
 
	

    Fair Market Value

	
 
	
    2

	

    2.8

	
 
	

    Holding Period

	
 
	
    2

	

    2.9

	
 
	

    Interest

	
 
	
    2

	

    2.10

	
 
	

    Offering

	
 
	
    2

	

    2.11

	
 
	

    Offering Period

	
 
	
    2

	

    2.12

	
 
	

    Option

	
 
	
    2

	

    2.13

	
 
	

    Option Grant Date

	
 
	
    2

	

    2.14

	
 
	

    Participant

	
 
	
    2

	

    2.15

	
 
	

    Participant Account

	
 
	
    3

	

    2.16

	
 
	

    Participant Share Account

	
 
	
    3

	

    2.17

	
 
	

    Plan Administrator

	
 
	
    3

	

    2.18

	
 
	

    Purchase Date

	
 
	
    3

	

    2.19

	
 
	

    Purchase Price

	
 
	
    3

	

    ARTICLE III  Eligibility

	
 
	
    3

	

    3.1

	
 
	

    Generally

	
 
	
    3

	

    3.2

	
 
	

    Limitations

	
 
	
    3

	

    ARTICLE IV  Offering

	
 
	
    4

	

    4.1

	
 
	

    Committee Discretion

	
 
	
    4

	

    4.2

	
 
	

    Changing the Terms and Conditions

	
 
	
    4

	

    ARTICLE V  Participation

	
 
	
    4

	

    5.1

	
 
	

    Generally

	
 
	
    4

	

    5.2

	
 
	

    Grant of Option to Eligible Employees

	
 
	
    4

	

    5.3

	
 
	

    Payroll Deductions

	
 
	
    5

	

    5.4

	
 
	

    Lump Sum Payments

	
 
	
    5

	

    ARTICLE VI  Purchase of Stock

	
 
	
    5

	

    6.1

	
 
	

    Participant Account; Exercise of Option on Purchase Date

	
 
	
    5

	

    6.2

	
 
	

    Excess Payments

	
 
	
    6

	

    6.3

	
 
	

    Limitation

	
 
	
    6

	

    ARTICLE VII  Withdrawal, Employment Termination and
    Leave of Absence

	
 
	
    6

	

    7.1

	
 
	

    Withdrawal

	
 
	
    6

	

    7.2

	
 
	

    Employment Termination

	
 
	
    7

	

    7.3

	
 
	

    Leave of Absence

	
 
	
    7

	

    ARTICLE VIII  Stock

	
 
	
    7

	

    8.1

	
 
	

    Generally

	
 
	
    7

	

    8.2

	
 
	

    Stockholder Rights

	
 
	
    7

	

    8.3

	
 
	

    Transfer and Forfeiture

	
 
	
    7

	

    8.4

	
 
	

    Removing Shares From the Participant Share Account

	
 
	
    7

	

    8.5

	
 
	

    Dividends

	
 
	
    8

 

	 	 	 	 	 
	
 
	
 
	
 
	
 
	

    Page

	 

	

    ARTICLE IX  Administration

	
 
	
    8

	

    9.1

	
 
	

    Generally

	
 
	
    8

	

    9.2

	
 
	

    Sale of Shares

	
 
	
    8

	

    9.3

	
 
	

    Expenses

	
 
	
    8

	

    9.4

	
 
	

    Custodian

	
 
	
    8

	

    ARTICLE X  Miscellaneous

	
 
	
    9

	

    10.1

	
 
	

    Transferability

	
 
	
    9

	

    10.2

	
 
	

    Change in Capitalization

	
 
	
    9

	

    10.3

	
 
	

    Amendment or Termination

	
 
	
    9

	

    10.4

	
 
	

    No Right to Continued Employment

	
 
	
    10

	

    10.5

	
 
	

    Taxes

	
 
	
    10

	

    10.6

	
 
	

    Nonexclusivity of the Plan

	
 
	
    10

	

    10.7

	
 
	

    Stockholder Approval

	
 
	
    10

	

    10.8

	
 
	

    Equal Rights and Privileges

	
 
	
    10

	

    10.9

	
 
	

    Controlling Law

	
 
	
    10

 

 

    FEDERAL
    HOME LOAN MORTGAGE CORPORATION

    EMPLOYEE STOCK PURCHASE PLAN

    (Amended and Restated as of January 1, 2005)

 

    ARTICLE
    I

    Establishment of the Plan

 

    1.1 Purpose.  This document constitutes a
    restatement of the employee stock purchase plan (the
    “Plan”) of the Federal Home Loan Mortgage Corporation
    (the “Corporation”) as originally adopted effective as
    of July 1, 1989, and as subsequently restated effective as
    of January 1, 1995. The purpose of the Plan is to allow
    employees to share in the growth of the Corporation through
    ownership of shares of the Corporation’s voting Common
    Stock, par value $0.21 per share (the “Common Stock”).
    It is the intention of the Corporation that the Plan qualify as
    an “employee stock purchase plan” within the meaning
    of Section 423 of the Internal Revenue Code of 1986, as
    amended (the “Code”). The Plan shall be interpreted in
    a manner consistent with that section of the Code.

 

    1.2 Effective Date.  The Plan as restated
    herein shall be effective as of January 1, 2005 and shall
    apply to Offerings on and after such date; provided, however,
    that the terms of participation in any Offering that commenced
    before January 1, 2005 but which ends on or after that date
    will be governed by the Plan provisions as in effect at the
    commencement of such Offering, except that shares delivered in
    such Offering shall count against the limit set forth in
    Section 8.1 and the Plan shall remain continuously in
    effect through such Offering Period in accordance with
    Section 10.3.

 

    1.3 Name.  The name of the Plan is the
    Federal Home Loan Mortgage Corporation Employee Stock Purchase
    Plan.

 

    ARTICLE
    II

    Definitions

 

    2.1 Board.  The Corporation’s Board
    of Directors.

 

    2.2 Compensation.  The non-deferred cash
    remuneration paid by the Corporation to an Employee, including
    salary, overtime pay, shift differentials, vacation pay, bonuses
    and commissions plus the amount of any elective deferrals under
    the Corporation’s Thrift/401(k) Savings Plan, the amount of
    any salary reduction amounts under the Corporation’s
    cafeteria plan, and amounts attributable to qualified
    transportation fringes that are excluded from gross income under
    Section 132(f)(4) of the Code; provided, however, that the
    Committee or Plan Administrator may include or exclude specific
    types of remuneration from Compensation for administrative
    convenience or otherwise to further the purposes of the Plan,
    subject to Section 10.8.

 

    2.3 Committee.  The Compensation and Human
    Resources Committee of the Board of Directors of the
    Corporation, or such other Board committee as may be designated
    by the Board to administer the Plan; provided, however, that the
    Committee shall at all times consist of two or more directors,
    each of whom is not an employee of the Corporation or any
    Affiliate. The full Board may perform any function of the
    Committee hereunder, in which case the term
    “Committee” shall refer to the Board.

    

    1

 

    2.4. Custodian.  UBS Financial Services,
    Inc., Smith Barney Inc. or other custodian as may be appointed
    by the Plan Administrator.

 

    2.5 Eligible Employee.  An Employee who
    has met the eligibility requirements under Article III,
    except as may be limited under Sections 7.2 and 7.3.

 

    2.6 Employee.  Any person employed by the
    Corporation on a full- or part-time regular basis as defined in
    Freddie Mac Corporate Policy
    No. 3-221,
    except that any person whose customary employment is either less
    than 20 hours per week or less than 5 months in any
    calendar year shall not be deemed an Employee. For this purpose,
    a person on approved paid or approved unpaid leave for
    90 days or less or who has a statutory or contractual right
    of continued employment upon the expiration of a leave of
    greater than 90 days shall be deemed to be an Employee.

 

    2.7 Fair Market Value.  As of any given
    date, the average of the high and the low sale prices of a share
    of Common Stock reported for composite transactions in New York
    Stock Exchange listed securities in print or electronically by
    The Wall Street Journal or by another recognized provider
    designated by the Committee, or, if no such prices are reported
    for such date, on the most recent trading day prior to such date
    for which such prices were reported; provided, however, that the
    Committee may in good faith, establish alternative methods or
    procedures for determining Fair Market Value.

 

    2.8 Holding Period.  The period of time,
    if any, following the Purchase Date during which Common Stock
    may not be sold, certificated, pledged, or otherwise transferred
    from the Participant Share Account. A Holding Period may be
    established by the Committee, in its discretion, with respect to
    any Offering, and may apply to all or a designated portion of
    the shares of Common Stock purchased by each Participant in the
    Offering, subject to Section 10.8.

 

    2.9 Interest.  Interest may be credited on
    payroll deductions accumulated in each Participant Account and
    on any Interest previously credited thereon periodically (or on
    the dates otherwise specified in Sections 6.2, 7.1 and 7.2)
    and on the Purchase Date, if so determined by the Committee.
    Interest shall not be credited on any lump sum payments tendered
    pursuant to Section 5.4, unless otherwise determined by the
    Committee. The rate of such Interest, if any, and the periodic
    crediting dates shall be set by the Committee pursuant to
    Section 4.1.

 

    2.10 Offering.  The opportunity extended
    to Eligible Employees to purchase Common Stock at the end of a
    specified Offering Period through participation in the Plan.

 

    2.11 Offering Period.  The period of time
    established by the Committee from time to time for an Offering,
    extending from the Option Grant Date for a specified period;
    provided, however, that under no circumstances shall any
    Offering Period exceed 27 months or such other period as
    may be required under Code section 423(b)(7).

 

    2.12 Option.  The conditional right of an
    Eligible Employee to purchase a specified dollar amount of
    shares or specified number of shares of Common Stock under the
    Plan in a specified Offering.

 

    2.13 Option Grant Date.  The first day of
    the Offering Period on which the New York Stock Exchange is
    open, which shall be deemed to be the day on which an Option is
    granted to a Participant.

 

    2.14 Participant.  An Eligible Employee
    who has been granted an Option in a given Offering and has taken
    any other required steps to participate in, and not withdrawn
    from, such Offering.

    

    2

 

    2.15 Participant Account.  An account
    established and maintained by the Corporation in the name of
    each Participant, to hold the Participant’s payroll
    deductions and any Interest accumulated thereon, together with
    lump sum payments tendered in accordance with Section 5.4.

 

    2.16 Participant Share Account.  An
    account established and maintained by the Custodian in which the
    shares of Common Stock purchased pursuant to this Plan and
    shares purchased by the reinvestment of dividends on such shares
    are held. This account may hold other shares of Common Stock
    acquired through the Corporation’s compensation programs or
    may be a subaccount under another account established in
    connection with the Corporation’s compensation programs, to
    the extent permitted by the Custodian and agreed to by the Plan
    Administrator in writing.

 

    2.17 Plan Administrator.  The Senior Vice
    President, Human Resources, or other person or committee as
    designated by the Committee.

 

    2.18 Purchase Date.  The last day of an
    Offering Period on which the New York Stock Exchange is open.

 

    2.19 Purchase Price.  The exercise price
    of each Option established by the Committee with respect to a
    particular Offering; provided, however, that such price shall
    not be less than the lesser of: (i) eighty-five percent
    (85%) of the Fair Market Value of the Common Stock on the Option
    Grant Date or (ii) eighty-five percent (85%) of the Fair
    Market Value of the Common Stock on the Purchase Date. Subject
    to the foregoing, the Committee may establish the Purchase Price
    with reference to the Fair Market Value of Common Stock (or a
    specified percentage thereof) on one or more specified dates
    during the Offering Period, but it need not be established with
    reference to Fair Market Value on both the Grant Date and the
    Purchase Date.

 

    ARTICLE
    III

    Eligibility

 

    3.1 Generally.  Provided that the Employee
    shall have timely enrolled in the manner specified by the
    Committee by the applicable deadline(s), an Employee shall be
    eligible to participate in the Plan for a given Offering if he
    or she (i) is an Employee on the Option Grant Date, and
    (ii) continuously meets any other eligibility requirements
    under the Plan or specified by the Plan Administrator through
    the Purchase Date for that Offering.

 

    3.2 Limitations.  Other provisions of the
    Plan notwithstanding, no Employee may be granted an Option if
    and to the extent that (i), immediately after the Option is
    granted, such Employee would own stock representing five percent
    (5%) or more of the total combined value or voting power of all
    classes of the stock of the Corporation, determined in
    accordance with Code Sections 423(b)(3) and 424(d); or
    (ii) such Option would permit the Employee’s rights to
    purchase stock under all of the Corporation’s plans subject
    to Code Section 423 to accrue at a rate which exceeds the
    fair market value dollar limit of such stock (currently $25,000)
    for the calendar year determined in accordance with Code
    Section 423(b)(8).

    

    3

 

    ARTICLE
    IV

    Offering

 

    4.1 Committee Discretion.  The Committee
    shall establish the terms and conditions of each Offering in
    accordance with the applicable terms of the Plan, including:

 

    (a) the Offering Period(s);

 

    (b) the maximum Fair Market Value or other dollar limit on
    shares, or the maximum number of shares, that may be subject to
    the Option granted to each Participant; provided, however, that
    such maximum limit shall be established so as not to exceed the
    limit under Section 3.2;

 

    (c) the formula for determination of the Purchase Price;

 

    (d) the forms of payment that will be made available to pay
    for Common Stock purchased upon exercise of the Option;

 

    (e) the Holding Period, if any;

 

    (f) the rate of Interest and times at which Interest will
    be credited, if any; and

 

    (g) whether to permit excess payments under Section 6.2 to
    be carried forward to a subsequent Offering Period.

 

    Any determination under the Plan within the discretion of the
    Plan Administrator may instead be made by the Committee. Unless
    otherwise specified by the Committee, the Plan Administrator
    shall retain discretion to thereafter change such determination.

 

    4.2 Changing the Terms and
    Conditions.  Once the terms and conditions in
    Section 4.1 are established by the Committee with respect
    to a particular Offering, they shall remain in effect with
    respect to subsequent Offerings unless expressly changed by the
    Committee.

 

    ARTICLE
    V

    Participation

 

    5.1 Generally.  An Eligible Employee may
    elect to participate in an Offering by completing any enrollment
    procedures required by the Committee or the Plan Administrator
    by the applicable deadline(s). Such election shall be in such
    manner or form, and subject to such rules and limitations, as
    may be specified by the Committee or the Plan Administrator. The
    Plan Administrator may require any or all of such elections to
    be made by a specified date or dates before the Offering Period,
    or may permit such elections to be made by a specified date or
    dates prior to and including the Purchase Date.

 

    5.2 Grant of Option to Eligible
    Employees.  Upon the Option Grant Date, each
    Eligible Employee shall be granted an Option to purchase a
    specified dollar amount or number of shares not exceeding the
    maximum limit on shares permitted to be purchased under
    Section 4.1(b). The grant of the Option may be made subject
    to requirements imposed by the Plan Administrator or the
    Committee that the Eligible Employee elect to participate in the
    Offering, and may be conditioned upon such election.

    

    4

 

    5.3 Payroll Deductions.  To the extent
    that the Committee has authorized payroll deductions with
    respect to the Offering, then:

 

    (a) Effective Date. An electing Participant’s
    payroll deductions shall become effective as soon as
    administratively feasible during the Offering Period.

 

    (b) Adoption of Administrative Rules. The Committee
    or Plan Administrator may adopt rules that require a Participant
    to accumulate in his or her Participant Account, through any
    combination of payroll deductions and/or lump sum payments under
    Section 5.4, an amount sufficient to pay the Purchase Price
    of the full Option or a specified portion thereof by the
    Purchase Date. Such rules will specify whether any failure to
    accumulate such amount (i) may be deemed an election to
    withdraw from the Offering, in which case the balance in the
    Participant Account shall be refunded as provided by
    Section 7.1, (ii) shall be deemed an election to
    exercise the Option to the extent of such balance as provided by
    Section 6.1, or (iii) shall have other specified
    consequences. The rules will also describe whether, and to what
    extent, Participants will be allowed to adjust their payroll
    deductions during the Offering Period, and the process for
    cessation of contributions described in Section 5.3(c).

 

    (c) Cessation and Resumption of Payroll Deductions.
    A Participant may instruct the Corporation to cease payroll
    deductions, which shall be effective on the first payroll date
    occurring at least fifteen (15) days (or such other period
    as specified by the Plan Administrator) after the Corporation
    receives notice (consistent with the administrative rules
    described in Section 5.3(b)) to cease deductions. Notice
    shall be provided by the Participant in a manner consistent with
    the procedures specified by the Plan Administrator. A
    Participant who has ceased payroll deductions may elect to:
    (i) withdraw from the Offering in accordance with
    Section 7.1; or (ii) have his or her Participant
    Account maintained through the Purchase Date (or such earlier
    date as the Plan Administrator may specify), at which time the
    amounts in the Participant Account will, to the extent permitted
    under the administrative rules described in Section 5.3(b),
    be used to pay the Purchase Price upon exercise of the Option
    (in full or in part). If the Participant has not withdrawn from
    the Offering, the Plan Administrator may determine to permit
    such a Participant to resume payroll deductions, subject to
    Section 10.8.

 

    (d) Participant Deduction Authorization. The
    election for payroll deductions shall authorize deductions by
    the Corporation from Compensation.

 

    (e) Interest. Interest, if any, credited to a
    Participant Account may not be applied to pay the Purchase
    Price, but may be withdrawn from the Account in accordance with
    such rules as the Plan Administrator may specify.

 

    5.4 Lump Sum Payments.  To the extent that
    the Committee authorizes lump sum payments, a Participant who
    elects to pay the Purchase Price (or any portion thereof) by
    lump sum may tender such payment to the Corporation in a manner
    and at such time as may be specified by the Plan Administrator,
    provided that such time is not later than the Purchase Date.

 

    ARTICLE
    VI

    Purchase of Stock

 

    6.1 Participant Account; Exercise of Option on Purchase
    Date.  Any amounts withheld as payroll deductions
    from a Participant’s Compensation during an Offering Period
    shall be reflected in a

    

    5

 

    Participant Account, to which balance shall be added any lump
    sum payment amounts tendered by the Participant under
    Section 5.4 (to the extent permitted by the terms of a
    particular Offering). Except as may be limited under rules
    adopted by the Plan Administrator, if a Participant has not
    withdrawn from participation in an Offering on the Purchase
    Date, the Participant’s Option shall be exercised
    automatically by applying all amounts accumulated in the
    Participant Account (other than Interest, if paid) to the
    purchase of Common Stock at the Purchase Price, subject to
    applicable limitations under Section 4.1(b). The
    Corporation or its designee shall allocate such shares purchased
    to the Participant Share Accounts. The foregoing
    notwithstanding, the Committee may provide for the automatic
    cancellation of an Offering based on specified circumstances
    arising at or before the Purchase Date, including the case in
    which the Purchase Price would equal or exceed the Fair Market
    Value of Common Stock at the Purchase Date.

 

    6.2 Excess Payments.  Except as described
    herein, in the event that the sum of a Participant’s
    accumulated payroll deductions and any lump sum payment tendered
    under Section 5.4 exceeds the amount applied to the
    purchase of Common Stock on the Purchase Date under
    Section 6.1, the excess over the aggregate Purchase Price
    of Common Stock shall be refunded to the Participant within
    sixty (60) days of the Purchase Date. Such refund shall be
    entitled to Interest through the Purchase Date, if and to the
    extent authorized by the Committee, in accordance with the rules
    then in effect under the Plan. The Committee may, in
    establishing the terms of an Offering as described in Section
    4.1, provide that such excess amounts accumulated in the
    Participant Accounts will be applied for the purchase of shares
    in a subsequent Offering Period.

 

    6.3 Limitation.  If on any Purchase Date
    the total number of shares to be purchased would cause the
    aggregate number of shares delivered under the Plan to exceed
    the total number of shares available for delivery under
    Section 8.1 of the Plan, then the number of shares to be
    purchased on such Purchase Date by any Participant shall be
    reduced pro-rata based on the number of shares for which the
    Participant’s Option would have been exercised, so that the
    number of shares purchased by all Participants equals the number
    of remaining available shares.

 

    ARTICLE
    VII

    Withdrawal, Employment Termination and Leave of
    Absence

 

    7.1 Withdrawal.  A Participant, by giving
    notice to the Corporation by such deadline and in such form as
    the Plan Administrator may establish, may withdraw from the Plan
    with respect to a specified Offering. In the event a Participant
    so withdraws: (i) payroll deductions, if any, previously
    authorized by such Participant shall cease, (ii) no shares
    shall be purchased for him or her on the Purchase Date for such
    Offering, and (iii) all amounts accumulated in his or her
    Participant Account, whether through payroll deduction, lump sum
    payment (if available) or crediting of Interest (if any,
    pursuant to Section 2.9), shall be refunded to him or her within
    sixty (60) days after the Purchase Date for the specified
    Offering. In such case, if the crediting of any Interest has
    been authorized by the Committee in accordance with
    Section 2.9, such crediting will apply only through the
    Purchase Date and not with respect to any period thereafter. A
    Participant who has instructed the Corporation to cease payroll
    deductions and who, pursuant to Section 5.3(c), receives a
    refund of the balance of his or her Participant Account shall be
    deemed to have withdrawn from the Plan for that Offering. A
    Participant’s withdrawal will not have any effect upon his
    or her eligibility to participate during any subsequent Offering.

    

    6

 

    7.2 Employment Termination.  In the event
    that a Participant’s employment terminates for any reason
    (including disability, retirement or death), no further payroll
    deduction shall be made from any Compensation due and owing to
    the Participant at such time and the Participant shall not be
    required or permitted to make a lump sum payment thereafter
    under the Plan. The Corporation shall refund the balance in the
    Participant Account with Interest, if any (pursuant to
    Section 2.9), credited through no later than the
    termination date, to the Participant, or, if the Participant is
    deceased, in accordance with Section 10.1, within sixty
    (60) days after the termination date. In such case, the
    Participant’s Option shall terminate at the time of
    termination of employment, and no shares may be purchased for a
    Participant thereafter for any reason.

 

    7.3 Leave of Absence.  The Plan
    Administrator may adopt rules governing Participants who take a
    leave of absence in excess of 90 days (without a statutory
    or contractual right to return) or who have other changes in
    employment status not otherwise covered by this
    Section 7.3, which rules may specify that such
    Participants’ participation may be limited or terminated
    (subject to the explicit terms of the Plan and the requirements
    of Code Section 423).

 

    ARTICLE
    VIII

    Stock

 

    8.1 Generally.  The shares of Common Stock
    of the Corporation to be delivered under the Plan upon purchase
    by Participants may consist, in whole or in part, of authorized
    but unissued shares, treasury shares, or shares acquired in
    market transactions on behalf of the Participants. The maximum
    number of shares that may be delivered upon purchase by
    Participants under the Plan shall be 3,600,000 plus the balance
    of any shares authorized for use under this Plan prior to its
    restatement effective January 1, 2005, subject to
    adjustment upon changes in capitalization of the Corporation as
    provided in Section 10.2. Any shares purchased by
    Participants pursuant to dividend reinvestment under
    Section 8.5 shall not be counted against the shares
    reserved for delivery under this Section 8.1.

 

    8.2 Stockholder Rights.  Subject to
    Section 8.3, upon purchase of shares on each Purchase Date,
    a Participant shall acquire all the rights and privileges of a
    stockholder in the Corporation with respect to shares delivered
    to him or her under the Plan on such Purchase Date, including
    the right to direct the vote of the shares on any matter for
    which the record date for voting is on or after such Purchase
    Date and the right to receive any dividend for which the record
    date is on or after such Purchase Date, for so long as such
    shares are credited to the Participant Share Account. These
    rights shall be subject to the customary terms and conditions
    applicable to shares held for customers in a brokerage account,
    except as otherwise provided by the Plan Administrator.

 

    8.3 Transfer and Forfeiture.  No
    Participant may sell, certificate, pledge or otherwise transfer
    the shares delivered to him or her under the Plan after the
    Effective Date until after the expiration of the applicable
    Holding Period, if any, except as permitted under Offering terms
    or rules adopted by the Committee. Shares purchased under the
    Plan are non-forfeitable.

 

    8.4 Removing Shares From the Participant Share
    Account.  After the expiration of the Holding
    Period, if any, applicable to shares, a Participant may remove
    shares from his or her Participant Share Account by
    (i) directing the sale of such shares; (ii) directing
    the issuance and delivery of a share certificate evidencing such
    shares; or (iii) if the Plan Administrator so permits,
    transferring such shares to another brokerage account, in each
    case subject to such rules as the Plan Administrator may
    establish (which may limit the availability of any of these
    alternatives so long as

    

    7

 

    some means for removal of shares is provided). In addition, a
    Participant’s ability to remove shares from the Participant
    Share Account and subsequent transactions in such shares may be
    restricted by the Plan Administrator for administrative reasons,
    may be conditioned upon the Participant’s agreement to
    promptly disclose his or her subsequent sales or dispositions of
    the shares and the terms thereof, and shall be subject to the
    Corporation’s securities compliance and insider trading
    rules and its code of conduct. Shares that are sold, shares for
    which certificates are issued or delivered (other than to the
    Custodian or its nominee) or shares that are transferred to
    another brokerage account will no longer be deemed held for a
    Participant’s Share Account.

 

    8.5 Dividends.  With regard to dividends
    declared and paid on shares held in a Participant Share Account
    at the record date for such dividends, a Participant may elect
    to: (i) receive such dividends in cash; or (ii) have
    such dividends reinvested in additional shares of Common Stock.
    Such dividend reinvestment purchases may be from the Corporation
    or in the open market on such terms and conditions as may be
    approved by the Plan Administrator, but in no event will any
    discount in the purchase price of shares provided under the Plan
    for regular Plan purchases apply to the dividend reinvestment
    purchases. Shares of Common Stock purchased through reinvestment
    of dividends shall not be regarded as purchased pursuant to the
    terms of this Plan.

 

    ARTICLE
    IX

    Administration

 

    9.1 Generally.  Subject to
    Section 4.1, the Plan shall be administered by the Plan
    Administrator and persons to whom the Plan Administrator may
    delegate authority. The Plan Administrator shall be vested with
    full authority to make, administer, and interpret such rules and
    regulations as deemed necessary to administer the Plan, and any
    determination, decision, or action of the Plan Administrator or
    persons to whom authority has been delegated in connection with
    the construction, interpretation, administration or application
    of the Plan shall be final, conclusive and binding upon all
    Participants. The Plan Administrator shall have the authority to
    employ agents to perform such of the administrative duties
    hereunder as may be delegated to such agents, and to authorize
    the payment of reasonable compensation for the performance of
    services by such agents. All actions by the Plan Administrator
    shall be deemed actions by or on behalf of the Corporation.

 

    9.2 Sale of Shares.  The Plan
    Administrator shall establish a procedure pursuant to which a
    Participant may arrange, after expiration of any applicable
    Holding Period, for the sale of shares credited to his or her
    Participant Share Account. Neither the Plan Administrator nor
    the Corporation shall have responsibility for, or incur
    liability as a result of, any transaction described in
    Section 8.4.

 

    9.3 Expenses.  Expenses associated with
    the purchase of shares pursuant to Article VI of the Plan
    and administration of the Plan shall be borne by the
    Corporation. Expenses incurred in connection with
    Participant’s sale of shares shall be borne by the
    Participant. Reasonable fees may be charged to Participants for
    other transactions and services under the Plan, in the
    discretion of the Plan Administrator.

 

    9.4 Custodian.  The Plan Administrator may
    appoint a Custodian that shall perform such duties as may be set
    forth in the Plan or in any agreement between the Corporation
    and the Custodian.

    

    8

 

    ARTICLE
    X

    Miscellaneous

 

    10.1 Transferability.  No right or
    interest of a Participant under the Plan may be pledged,
    encumbered, or hypothecated to or in favor of any party, made
    subject to any lien, obligation, or liability of such
    Participant, or otherwise assigned, transferred, or disposed of
    except by will or the laws of descent and distribution (subject
    to the limitations set forth in Section 7.2), and any right
    of a Participant under the Plan will be exercisable during the
    Participant’s lifetime only by the Participant. The
    foregoing notwithstanding, the Plan Administrator may, in its
    discretion, approve alternative forms of registration of a
    Participant Share Account to the extent permitted by applicable
    regulations under Section 423 of the Code.

 

    10.2 Change in Capitalization.  The number
    and kind of shares of stock available for issuance or delivery
    under the Plan, and the calculated Purchase Price for any
    ongoing Offering, will be proportionately adjusted, as
    determined by the Committee, in the event of any large, special
    and non-recurring dividend or other distribution (whether in the
    form of cash or other property), recapitalization, forward or
    reverse split, dividend of Common Stock, reorganization, merger,
    consolidation, spin-off, combination, repurchase, or share
    exchange, rights offering or other similar corporate transaction
    or event affecting the Common Stock. Alternatively, the
    Committee may terminate any ongoing Offering or accelerate the
    end of the Offering Period prior to such extraordinary event in
    order that the interests of Participants will not be impaired as
    a result of such an event.

 

    10.3 Amendment or Termination.  The
    Committee may amend, alter, suspend, discontinue, or terminate
    the Plan without the consent of stockholders or Participants,
    except that any such action will be subject to the approval of
    the Corporation’s stockholders within twelve months after
    such Committee action if such stockholder approval is required
    by any applicable federal or state law or regulation or the
    rules of any automated quotation system or stock exchange on
    which the Common Stock may then be quoted or listed, and the
    Committee may otherwise, in its discretion, determine to submit
    other such actions to stockholders for approval; provided,
    however, that (i) any amendment or other action under this
    Section 10.3 by the Committee pursuant to delegated
    authority, to increase the shares available under the Plan
    (other than in connection with an adjustment under
    Section 10.2), reduce the minimum Purchase Price permitted
    under the Plan, or increase the maximum amount of Participant
    contributions under Section 3.2 to an amount in excess of
    the level then permitted under Code Section 423, or which
    otherwise exceeds the authority of the Committee under the
    Committee’s charter and applicable resolutions of the
    Board, shall require the approval of the Board as well; and
    (ii), without the consent of an affected Participant, no
    amendment, alteration, suspension, discontinuation, or
    termination of the Plan may materially and adversely affect the
    rights of such Participant with respect to any Offering that has
    been completed prior to such Committee action. The foregoing
    notwithstanding, (a) upon termination of the Plan, the
    Committee may elect to terminate all outstanding Options at such
    time as the Committee may designate; (b) in the event of
    such termination of any Option prior to its exercise, all
    amounts contributed to the Plan which remain in a
    Participant’s Account will be returned to the Participant
    as promptly as practicable; and (c) the Plan shall
    automatically terminate upon the earlier of: (i) the date
    on which the total number of shares authorized for purchase
    under the Plan have been purchased and any Plan requirements
    extending thereafter (e.g., any Holding Period) have been
    met; or (ii) January 1, 2015.

    

    9

 

    10.4 No Right to Continued
    Employment.  Neither the Plan nor any action taken
    hereunder, including the grant of an Option, will be construed
    as giving any employee the right to be retained in the employ of
    the Corporation, nor will it interfere in any way with the right
    of the Corporation to terminate any employee’s employment
    at any time.

 

    10.5 Taxes.  The Corporation is authorized
    to withhold from any payment to be made to a Participant,
    including any payroll and other payments not related to the
    Plan, amounts of withholding and other taxes due in connection
    with any transaction under the Plan, and a Participant’s
    enrollment in the Plan will be deemed to constitute his or her
    consent to such withholding. In addition, Participants may be
    required to advise the Corporation of sales and other
    dispositions of Common Stock acquired under the Plan in order to
    permit the Corporation to comply with tax laws and to claim any
    tax deductions to which the Corporation may be entitled with
    respect to the Plan.

 

    10.6 Nonexclusivity of the Plan.  Neither
    the adoption of the Plan by the Committee nor its submission to
    the stockholders of the Corporation for approval will be
    construed as creating any limitations on the power of the
    Committee to adopt such other compensatory arrangements as it
    may deem desirable, including, without limitation, the granting
    of stock options otherwise than under the Plan, and such
    arrangements may be either applicable generally or only in
    specific cases.

 

    10.7 Stockholder Approval.  The Plan (as
    amended and restated) shall become effective on the Effective
    Date; provided, however, that the Plan has been approved by the
    stockholders of the Corporation in a manner sufficient to meet
    the requirements of Section 423(b)(2) of the Code.

 

    10.8 Equal Rights and Privileges.  All
    Participants shall have the same rights, responsibilities and
    privileges with respect to Options granted and Common Stock
    purchased under the Plan, (i) except as limited under
    Section 3.2, (ii) except that the amount of Common
    Stock which may be purchased by any Employee under such Option
    may bear a uniform relationship to the Compensation of such
    Employee, and (iii) except as otherwise may be permitted
    under Section 423 of the Code.

 

    10.9 Controlling Law.  This Plan and the
    respective rights and obligations of the Corporation and the
    Participants, except to the extent otherwise provided by
    applicable federal law, shall be construed under the laws of the
    Commonwealth of Virginia, exclusive of Virginia’s conflict
    of laws provisions.

    

    10exv10w17

 

    Exhibit 10.17

 

 

    FEDERAL
    HOME LOAN MORTGAGE CORPORATION

 

    1995
    DIRECTORS’ STOCK COMPENSATION PLAN

 

 

    Effective
    May 2, 1995

    As Amended and Restated June 8, 2007

 

 

    TABLE OF
    CONTENTS

 

	 	 	 	 	 
	
 
	
 
	
 
	
 
	

    Page

	 

	

    ARTICLE I — Establishment of the Plan

	
 
	
    1

	

    1.1

	
 
	

    Purposes

	
 
	
    1

	

    1.2

	
 
	

    Effective Date of Original Plan and Amendment and Restatement of
    Plan

	
 
	
    1

	

    1.3

	
 
	

    Plan Name

	
 
	
    1

	

    ARTICLE II — Definitions

	
 
	
    1

	

    2.1

	
 
	

    Award

	
 
	
    1

	

    2.2

	
 
	

    Award Document

	
 
	
    1

	

    2.3

	
 
	

    Beneficiary

	
 
	
    1

	

    2.4

	
 
	

    Board

	
 
	
    1

	

    2.5

	
 
	

    Code

	
 
	
    1

	

    2.6

	
 
	

    Committee

	
 
	
    1

	

    2.7

	
 
	

    Common Stock

	
 
	
    2

	

    2.8

	
 
	

    Compensation

	
 
	
    2

	

    2.9

	
 
	

    Corporation

	
 
	
    2

	

    2.10

	
 
	

    Deferred Stock

	
 
	
    2

	

    2.11

	
 
	

    Disability

	
 
	
    2

	

    2.12

	
 
	

    Director

	
 
	
    2

	

    2.13

	
 
	

    Dividend Equivalents

	
 
	
    2

	

    2.14

	
 
	

    Early Retirement

	
 
	
    2

	

    2.15

	
 
	

    Fair Market Value

	
 
	
    2

	

    2.16

	
 
	

    Option

	
 
	
    3

	

    2.17

	
 
	

    Participant

	
 
	
    3

	

    2.18

	
 
	

    Plan

	
 
	
    3

	

    2.19

	
 
	

    Restricted Stock

	
 
	
    3

	

    2.20

	
 
	

    Restricted Stock Units

	
 
	
    3

	

    2.21

	
 
	

    Retirement

	
 
	
    3

	

    2.22

	
 
	

    Retirement Age

	
 
	
    3

	

    2.23

	
 
	

    Stock Election

	
 
	
    3

	

    ARTICLE III — Administration

	
 
	
    3

	

    3.1

	
 
	

    Authority of the Committee Generally

	
 
	
    3

	

    3.2

	
 
	

    Authority of the Board

	
 
	
    4

	

    3.3

	
 
	

    Good Faith Reliance; Limitation on Liability

	
 
	
    4

	

    3.4

	
 
	

    Limitation on Repricing

	
 
	
    4

	

    ARTICLE IV — Common Stock Available Under the Plan;
    Adjustments

	
 
	
    4

	

    4.1

	
 
	

    Common Stock Available for Delivery

	
 
	
    4

	

    4.2

	
 
	

    Source of Common Stock

	
 
	
    5

	

    4.3

	
 
	

    Adjustments in Response to Corporate Events

	
 
	
    5

	

    ARTICLE V — Eligibility

	
 
	
    6

	

    5.1

	
 
	

    Persons Eligible

	
 
	
    6

	

    5.2

	
 
	

    Rights to Awards

	
 
	
    6

	

    ARTICLE VI — Terms of Awards

	
 
	
    6

	

    6.1

	
 
	

    General

	
 
	
    6

	

    6.2

	
 
	

    Limitations on Transferability

	
 
	
    6

	

    6.3

	
 
	

    No Stockholder Rights

	
 
	
    6

	

    6.4

	
 
	

    Insider Trading Policies Apply

	
 
	
    6

    

    i

 

	 	 	 	 	 
	
 
	
 
	
 
	
 
	

    Page

	 

	

    ARTICLE VII — Options

	
 
	
    6

	

    7.1

	
 
	

    Award

	
 
	
    6

	

    7.2

	
 
	

    Terms of Award

	
 
	
    7

	

    7.3

	
 
	

    Termination of Board Membership

	
 
	
    7

	

    ARTICLE VIII — Restricted Stock and Restricted Stock Units

	
 
	
    7

	

    8.1

	
 
	

    Award

	
 
	
    7

	

    8.2

	
 
	

    Vesting Schedule

	
 
	
    7

	

    8.3

	
 
	

    Termination of Board Membership

	
 
	
    7

	

    8.4

	
 
	

    Other Terms of Restricted Stock

	
 
	
    7

	

    8.5

	
 
	

    Other Terms of Restricted Stock Units

	
 
	
    8

	

    ARTICLE IX — Stock Election

	
 
	
    8

	

    9.1

	
 
	

    Election to Receive Stock

	
 
	
    8

	

    9.2

	
 
	

    Amount of Stock or Deferred Stock

	
 
	
    9

	

    9.3

	
 
	

    Receipt of Common Stock Pursuant to a Stock Election

	
 
	
    9

	

    9.4

	
 
	

    Award of Deferred Stock Pursuant to a Stock Election

	
 
	
    10

	

    ARTICLE X — General Provisions

	
 
	
    10

	

    10.1

	
 
	

    Consideration

	
 
	
    10

	

    10.2

	
 
	

    Compliance with Laws and Obligations

	
 
	
    11

	

    10.3

	
 
	

    No Right to Continued Membership

	
 
	
    11

	

    10.4

	
 
	

    Changes to the Plan and Awards

	
 
	
    11

	

    10.5

	
 
	

    Governing Law

	
 
	
    12

	

    10.6

	
 
	

    Certain Limitations on Awards to Ensure Compliance with Code
    Section 409A

	
 
	
    12

	

    10.7

	
 
	

    Continued Service as an Employee

	
 
	
    13

	

    10.8

	
 
	

    Plan Termination; Effect of Amendment and Restatement

	
 
	
    13

    

    ii

 

 

    FEDERAL
    HOME LOAN MORTGAGE CORPORATION

    1995 DIRECTORS’ STOCK COMPENSATION PLAN

    As Amended and Restated June 8, 2007

 

    ARTICLE
    I

    Establishment of the Plan

 

    1.1  Purposes.  The purposes of this
    1995 Directors’ Stock Compensation Plan (the
    “Plan”) of the Federal Home Loan Mortgage Corporation
    (the “Corporation”) are to advance the interests of
    the Corporation and its stockholders by providing a means to
    attract and retain highly-qualified persons who are not
    employees of the Corporation to serve as Directors, to provide
    reasonable compensation for service to the Corporation by such
    Directors, and to promote ownership by such Directors of a
    greater proprietary interest in the Corporation, thereby
    aligning such Directors’ interests more closely with the
    interests of stockholders of the Corporation.

 

    1.2  Effective Date of Original Plan and Amendment
    and Restatement of Plan.  This Plan became
    effective May 2, 1995. This amendment and restatement of
    the Plan shall become effective when approved by the
    Corporation’s stockholders as set forth in
    Section 10.8.

 

    1.3  Plan Name.  The name of the Plan
    is the Federal Home Loan Mortgage Corporation 1995
    Directors’ Stock Compensation Plan.

 

    ARTICLE
    II

    Definitions

 

    2.1  Award.  Any Option, Restricted
    Stock, Restricted Stock Unit, or right to receive shares of
    Common Stock or Deferred Stock pursuant to a Stock Election, or
    any combination thereof, granted under the Plan.

 

    2.2  Award Document.  Any written or
    electronic agreement, contract, notice, or other instrument or
    document evidencing an Award. The use of an “electronic
    record” and an “electronic signature” in
    connection with any Award Document shall be governed by the
    federal Electronic Signatures in Global and National Commerce
    Act of 2000
    (E-SIGN) or
    the Uniform Electronic Transactions Act (UETA) as enacted
    by the Commonwealth of Virginia, as applicable. The terms
    “electronic records” and “electronic
    signature” shall have the meanings ascribed to such terms
    in E-SIGN or
    the Virginia UETA, as applicable.

 

    2.3  Beneficiary.  The person(s) or
    trust(s) which have been designated by a Participant in his or
    her most recent beneficiary designation filed with the Committee
    to receive the benefits in connection with an Award upon such
    Participant’s death, or to whom or to which an Award or
    rights relating thereto are transferred if and to the extent
    permitted under Section 6.2. If, upon a Participant’s
    death, there is no designated Beneficiary or surviving
    designated Beneficiary, then the term Beneficiary means the
    person(s) or trust(s) entitled by will or laws of descent and
    distribution to receive such benefits.

 

    2.4  Board.  The Board of Directors
    of the Corporation.

 

    2.5  Code.  The Internal Revenue Code
    of 1986, as amended from time to time.

 

    2.6  Committee.  The Compensation and
    Human Resources Committee of the Board, or such other Board
    committee as may be designated by the Board to administer the
    Plan. No member of the Committee who is a Participant shall
    participate in any determination relating solely or primarily to
    his or her own Award. In addition, in any case in which the
    Board exercises any

    

    1

 

    authority granted to the Committee under the Plan, each
    reference to “Committee” shall be deemed to mean the
    Board, unless the context otherwise requires.

 

    2.7  Common Stock.  The Common Stock,
    $0.21 par value, of the Corporation or such other common stock
    as may be substituted or resubstituted for Common Stock pursuant
    to an adjustment under Section 4.3.

 

    2.8  Compensation.  The retainer and
    meeting fees and any other fees paid to a Director for services
    as such, including for service as a member of a committee of the
    Board.

 

    2.9  Corporation.  The Federal Home
    Loan Mortgage Corporation.

 

    2.10  Deferred Stock.  An Award, in
    lieu of other Compensation pursuant to a Stock Election under
    Article IX or as a result of Dividend Equivalents, which
    Award represents a generally nontransferable right to receive
    one share of Common Stock at a specified future date for each
    share of Deferred Stock awarded, together with a right to
    Dividend Equivalents and other rights, and subject to the terms
    and conditions set forth in Article IX.

 

    2.11  Disability.  A
    Participant’s termination of service as a Director of the
    Corporation due to injury or sickness which the
    Participant’s personal physician has certified to the
    Committee prevents the Participant from performing the material
    duties of a Director.

 

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

 

    2.13  Dividend Equivalents.  With
    respect to each Restricted Stock Unit and each share of Deferred
    Stock, a right either to receive payments equal to the dividends
    or distributions declared or paid on a share of Common Stock at
    the same time as those dividends or distributions are paid to
    holders of Common Stock, or to receive such amounts, at the time
    the Restricted Stock Unit or Deferred Stock is or would be
    otherwise settled, or to have such amounts credited to the
    Participant, at the time the dividends or distributions are paid
    to holders of Common Stock, in the form of additional Restricted
    Stock Units or Deferred Stock having a Fair Market Value, at the
    date such dividends or distributions are paid on Common Stock,
    equal to the amount of the dividends or distributions declared
    and paid on a share of Common Stock, subject to
    Section 9.4. Rights to Dividend Equivalents shall be
    non-forfeitable in all cases. The Committee shall determine the
    manner of payment or crediting of Dividend Equivalents at or
    before the grant date for any Award of Restricted Stock Units or
    Deferred Stock. No Dividend Equivalents will be credited or
    payable with respect to any Award other than Restricted Stock
    Units or Deferred Stock.

 

    2.14  Early Retirement.  A
    Director’s termination of membership on the Board (other
    than due to Disability, Retirement or death) and (a), for a
    Director appointed by the President of United States
    (“President”), upon (i) notification by the
    President (or designee) that the Director will not be
    reappointed or (ii) failure of the President to reappoint
    the Director, or notify the Corporation of his intention to
    reappoint the Director, within 120 days after the end of that
    Director’s term of office; (b), for all other Directors,
    after completing ten consecutive terms in office as a Director.

 

    2.15  Fair Market Value.  The closing
    sale price of a share of Common Stock reported for composite
    transactions in the New York Stock Exchange listed securities in
    print or electronically by The Wall Street Journal or by another
    recognized provider designated by the Committee for such date
    or, if no such prices are reported for such date, on the most
    recent trading day prior to such date for which such prices are
    reported; provided, however, that the Committee may, in good
    faith, establish alternative methods or procedures for
    determining Fair Market Value. Fair Market

    

    2

 

    Value of Restricted Stock, Restricted Stock Units, or Deferred
    Stock shall be based on the shares subject to such Award without
    regard to any risk of forfeiture or restriction on
    transferability applicable to such Award.

 

    2.16  Option.  An Award under
    Article VII representing a conditional right to purchase,
    upon the exercise of the right by the Participant or his or her
    Beneficiary, a specified number of shares of Common Stock at a
    fixed price during a specified period or periods, and subject to
    such other conditions as the Committee may specify.

 

    2.17  Participant.  A Director who
    has been granted an Award under the Plan.

 

    2.18  Plan.  This 1995
    Directors’ Stock Compensation Plan.

 

    2.19  Restricted Stock.  An Award
    under Article VIII pursuant to which a specified number of
    shares of Common Stock are granted to the Participant, subject
    to a specified risk of forfeiture and restriction on
    transferability until the expiration of a specified restricted
    period or periods, and subject to such other conditions as the
    Committee may specify.

 

    2.20  Restricted Stock Units.  An
    Award under Article VIII or as a result of Dividend
    Equivalents which represents a generally nontransferable right
    to receive one share of Common Stock at a specified future date
    for each Restricted Stock Unit awarded, together with a right to
    Dividend Equivalents and other rights, subject to a specified
    risk of forfeiture (except in the case of Restricted Stock Units
    resulting from Dividend Equivalents) until the expiration of a
    specified period or periods and other terms and conditions set
    forth in Article VIII, and subject to such other conditions
    as the Committee may specify.

 

    2.21  Retirement.  A
    stockholder-elected Director’s termination of membership on
    the Board upon or after, and as a consequence of, attaining the
    Retirement Age.

 

    2.22  Retirement Age.  The retirement
    age which, under the Board retirement policy adopted by the
    Board of Directors (as such policy may be modified from time to
    time), is applicable to the affected stockholder-elected
    Director.

 

    2.23  Stock Election.  An election,
    made pursuant to Article IX, by an eligible Director, to
    receive Common Stock or Deferred Stock in payment of all or a
    portion of Compensation.

 

    ARTICLE
    III

    Administration

 

    3.1  Authority of the Committee
    Generally.  The Plan shall be administered by the
    Committee, except insofar as administrative authority is
    expressly reserved to the Board. The Committee shall have full
    and final authority to take the following actions, in each case
    subject to and consistent with the provisions of the Plan:

 

    (a) to recommend to the Board policies regarding the type
    or types of Awards to be granted to Directors for specified
    services, the time or times at which such Awards may be granted,
    the number of shares of Common Stock to be subject to each
    Award, and the material terms and conditions of such Awards not
    otherwise specified in the Plan, and to determine all other
    matters in connection with an Award not otherwise specified in
    the Plan or determined by the Board;

 

    (b) to prescribe the form of each Award Document;

    

    3

 

    (c) to adopt, amend, suspend, waive, and rescind such rules
    and regulations as the Committee may deem necessary or advisable
    to administer the Plan, including rules that reflect the advice
    of counsel, promoting compliance with applicable laws and
    regulations;

 

    (d) to correct any defect, fill any omission or reconcile
    any inconsistency in the Plan and to construe and interpret the
    Plan and any Award, rules and regulations, Award Document, or
    other instrument hereunder; and

 

    (e) to make all other decisions and determinations as may
    be required under the terms of the Plan or as the Committee may
    deem necessary or advisable for the administration of the Plan.

 

    3.2  Authority of the Board.  In
    furtherance of the authority of the Board to establish policies
    providing for reasonable compensation to Directors and setting
    the form, timing, and other terms of such compensation, the
    Board shall have full and final authority to establish policies
    regarding the type or types of Awards to be granted under
    Articles VII and VIII to Directors for specified services,
    the time or times at which such Awards may be granted, the
    number of shares of Common Stock to be subject to each Award,
    and the material terms and conditions of Awards, in each case
    subject to and consistent with the provisions of the Plan. In
    addition, the Board may exercise any authority of the Committee
    under the Plan.

 

    3.3  Good Faith Reliance; Limitation on
    Liability.  Each member of the Committee or the
    Board shall be entitled to, in good faith, rely or act upon any
    report or other information furnished to him or her by any
    officer or other employee of the Corporation, the
    Corporation’s independent public accountants, or any
    compensation consultant, legal counsel, or other professional
    retained by the Corporation or the Committee to assist in the
    administration of the Plan. No member of the Committee or Board,
    nor any officer or employee of the Corporation acting on behalf
    of the Committee or Board hereunder, shall be personally liable
    for any action, determination, or interpretation taken or made
    in good faith with respect to the Plan, and members of the
    Committee and Board and any officer or employee of the
    Corporation acting on behalf of the Committee or Board or
    members thereof shall, to the extent permitted by law, be fully
    indemnified and protected by the Corporation with respect to any
    such action, determination, or interpretation.

 

    3.4  Limitation on Repricing.  Other
    provisions of the Plan notwithstanding, without the prior
    approval of the Corporation’s stockholders, the Committee
    will not amend or replace previously granted Options in a
    transaction that constitutes a “repricing.”
    “Repricing” means: (a) lowering the exercise
    price of an Option after it is granted; (b) canceling an
    Option at a time when its exercise price exceeds the fair market
    value of the underlying stock, in exchange for another Option,
    Restricted Stock, other Award, other equity, or cash or other
    property, unless the cancellation and exchange occurs in
    connection with a merger, acquisition, spin-off or other similar
    corporate transaction; (c) any other action that is treated
    as a repricing under generally accepted accounting principles;
    or (d) any other action that has the same effect as those
    itemized in (a) – (c); provided, however, that any
    adjustment authorized by Section 4.3 shall under no
    circumstances be considered a “repricing.”

 

    ARTICLE
    IV

    Common Stock Available Under the Plan; Adjustments

 

    4.1  Common Stock Available for
    Delivery.  Subject to adjustment as hereinafter
    provided, the total number of shares of Common Stock reserved
    and available for delivery in connection with Awards under the
    Plan shall be 2,400,000, which is the number of shares
    originally authorized under

    

    4

 

    the Plan at its effective date (adjusted for stock splits since
    the effective date); provided, however, that not more than 40%
    of the total number of shares reserved and available under the
    Plan shall be subject to Awards of Restricted Stock and
    Restricted Stock Units under Section 8.1 which become
    vested and nonforfeitable under Section 8.2. If all or any
    portion of any Award is forfeited, or otherwise is terminated
    without delivery of shares of Common Stock to the Participant,
    the shares to which such Award or portion thereof related shall
    again be available for Awards under the Plan. For this purpose,
    upon exercise of an Option, the gross number of shares subject
    to the portion of the Option so exercised shall be deemed to
    have been delivered upon exercise of the Award.

 

    4.2  Source of Common Stock.  Any
    shares of Common Stock delivered pursuant to an Award may
    consist, in whole or in part, of authorized but previously
    unissued shares, treasury shares, or shares acquired in market
    transactions on behalf of the Participants.

 

    4.3  Adjustments in Response to Corporate
    Events.  In the event that the Committee shall
    determine that any large and non-recurring dividend or other
    distribution (whether in the form of cash or other property),
    recapitalization, forward or reverse split, dividend of Common
    Stock, reorganization, merger, consolidation, spin-off,
    combination, repurchase or share exchange, rights offering, or
    other similar corporate transaction or event affects the Common
    Stock, then the Committee shall, in such manner as it may deem
    equitable, (i) adjust any or all of the number and kind of
    shares of Common Stock then authorized for delivery for Awards
    under Section 4.1 and the number and kind of shares of
    Common Stock to be subject to each automatic grant of Options
    under Article VII or Restricted Stock or Restricted Stock
    Units under Article VIII in accordance with any granting
    policy of the Board then in effect; and (ii) if an
    adjustment is necessary in order to prevent dilution or
    enlargement of the rights of Participants under the Plan, as
    determined by the Committee, adjust (A) the number and kind
    of shares of outstanding Restricted Stock or other outstanding
    Award in connection with which shares have been issued or
    delivered, (B) the number and kind of shares that may be
    issued or delivered in respect of other outstanding Awards,
    (C) the exercise price, grant price, or purchase price
    relating to any Award (or, if deemed appropriate, the Committee
    may make provision for a cash payment with respect to any
    outstanding Award), and (D) any other term relating to an
    Award; provided that any adjustment effecting any outstanding
    Award shall be made in accordance with Section 10.4(b).
    Unless otherwise determined by the Committee, in the event of a
    forward split of Common Stock or a dividend in the form of
    Common Stock, each adjustment specified in Section 4.3(i)
    and (ii)(A), (B) and (C) shall be effected
    automatically by multiplying the relevant pre-transaction number
    of shares by the sum of one plus the number of shares
    deliverable in respect of each outstanding share, and dividing
    the exercise price of each outstanding Option by that same sum.
    In furtherance of the foregoing, in the event of an “equity
    restructuring” as defined in FAS 123R which affects
    the Common Stock, a Participant shall have a legal right to an
    adjustment to the Participant’s Award which shall preserve
    without enlarging the value of the Award, with the manner of
    such adjustment to be determined by the Committee in its
    discretion, and subject to any limitation on this right set
    forth in the applicable Award Document. If at any date an
    insufficient number of shares are available for the grant of
    Awards hereunder, then all Awards to be made at that date shall
    be reduced proportionately by applying a fraction, the numerator
    of which shall be the number of shares remaining and the
    denominator of which shall be the number of shares necessary for
    the grant of full Awards hereunder.

    

    5

 

    ARTICLE
    V

    Eligibility

 

    5.1  Persons Eligible.  Any Director
    of the Corporation is eligible to be granted Awards under the
    Plan.

 

    5.2  Rights to Awards.  A Participant
    or Director eligible to be a Participant shall be entitled to
    Awards under the Plan as expressly provided in and as authorized
    by the Board under the Plan.

 

    ARTICLE
    VI

    Terms of Awards

 

    6.1  General.  Awards shall be
    granted on the terms and conditions set forth herein and as
    specified by the Board and the Committee hereunder.

 

    6.2  Limitations on
    Transferability.  Awards and any other rights
    under the Plan shall not be transferable by a Participant except
    by will or the laws of descent and distribution (or to a
    designated Beneficiary in the event of a Participant’s
    death) and, if exercisable, shall be exercisable during the
    lifetime of a Participant only by such Participant or his or her
    guardian or legal representative. No transfer by will or the
    laws of descent and distribution shall be effective to bind the
    Corporation unless the Corporation shall have been furnished
    with a copy of such will or other evidence as the Corporation
    may deem necessary to establish the validity of the transfer.
    Awards and other rights under the Plan may not be pledged,
    mortgaged, hypothecated, or otherwise encumbered, and shall not
    be subject to the claims of creditors. The foregoing
    notwithstanding, if and to the extent expressly permitted by the
    Committee, and subject to such terms and conditions as
    established by the Committee, such Awards and other rights may
    be transferred by a Participant to one or more Beneficiaries,
    and may be exercised by such Beneficiaries in accordance with
    the terms of such Award, but such transfers may be permitted
    only for estate-planning purposes and shall not be transfers for
    value.

 

    6.3  No Stockholder Rights.  No Award
    shall confer on any Participant any of the rights of a
    stockholder of the Corporation unless and until Common Stock is
    duly issued or transferred to the Participant in accordance with
    the terms of the Award or, in the case of an Option, at such
    time at or after the exercise of the Option as may be specified
    by the Committee in order to facilitate exercise procedures.

 

    6.4  Insider Trading Policies
    Apply.  A Participant’s rights under any
    Award, including rights to exercise or receive settlement and
    rights to sell any Common Stock delivered in connection with an
    Award, are subject to the terms of the Corporation’s Code
    of Conduct (or any successor thereof) and related policies on
    insider trading and may be restricted by those documents. Such
    restrictions currently include limitations on the times at which
    the Participant may engage in such transactions.

 

    ARTICLE
    VII

    Options

 

    7.1  Award.  Options shall be granted
    to Directors in accordance with policies established from time
    to time by the Board specifying the number of shares to be
    subject to each Option, the time or times at which such Options
    shall be granted, and other Award terms not inconsistent with
    this Article VII.

    

    6

 

    7.2  Terms of Award.  Each Option
    granted to a Participant under the Plan shall be evidenced by an
    Award Document containing terms and conditions as follows:

 

    (a) Option Price.  The Option price per
    share shall be the Fair Market Value of the Common Stock at time
    of grant.

 

    (b) Option Term.  Each Option awarded
    under this Plan shall expire on the date which is ten years
    after the date of grant (or such lesser period as may be
    specified by the Board at the time of grant), or such earlier
    date as the Option may no longer be exercised and cannot, by its
    terms, thereafter become exercisable.

 

    (c) Exercise.  The Board may establish
    terms regarding the times at which Options shall become vested
    and exercisable.

 

    (d) Payment.  The purchase price of the
    shares to which an Option relates shall be paid to the
    Corporation either in cash, in Common Stock owned by the
    Participant, or by directing the Corporation to withhold from
    the shares deliverable upon exercise of the Option shares
    sufficient to pay the exercise price, or any combination of
    these exercise methods, or by any other exercise method as may
    be authorized by the Committee, except to the extent that the
    Committee may restrict any of these exercise methods (providing
    that at least one exercise method must remain permitted).

 

    7.3  Termination of Board
    Membership.  The Board may establish terms
    regarding the extent to which, upon or following termination of
    a Director’s membership on the Board, including upon death,
    Disability, Retirement or Early Retirement, Options shall become
    vested and exercisable on an accelerated basis, Options shall
    cease to become vested and exercisable, or Options shall cease
    to be exercisable or shall be forfeited.

 

    ARTICLE
    VIII

    Restricted Stock and Restricted Stock Units

 

    8.1  Award.  Restricted Stock and
    Restricted Stock Units shall be granted to Directors in
    accordance with policies established from time to time by the
    Board specifying the number of shares of Restricted Stock or
    Restricted Stock Units to be granted, the time or times at which
    such Restricted Stock or Restricted Stock Units shall be
    granted, and other Award terms not inconsistent with this
    Article VIII.

 

    8.2  Vesting Schedule.  The Board may
    establish terms regarding the times at which Restricted Stock or
    Restricted Stock Units shall vest and become nonforfeitable, and
    the times at which Restricted Stock Units will be settled.

 

    8.3  Termination of Board
    Membership.  The Board may establish terms
    regarding the extent to which, upon or following termination of
    a Director’s membership on the Board, including upon death,
    Disability, Retirement or Early Retirement, Restricted Stock and
    Restricted Stock Units shall become nonforfeitable on an
    accelerated basis, continue to vest or shall be forfeited.

 

    8.4  Other Terms of Restricted
    Stock.  The Board or Committee shall specify terms
    and conditions applicable to Restricted Stock, subject to and
    consistent with the terms of the Plan, including the following:

 

    (a) Non-Cash Dividends or Distributions on Restricted
    Stock.  Unless otherwise determined by the Board,
    any non-cash dividend or distribution on Restricted Stock,
    including shares of Common Stock distributed as a dividend on
    Restricted Stock or other securities or

    

    7

 

    property other than shares of Common Stock, shall remain subject
    to all restrictions and risk of forfeiture as applied to the
    shares of Restricted Stock with respect to which it or they were
    paid as a dividend or distribution. In the case of securities
    other than shares of Common Stock or in the case of other
    property, issued with respect to Restricted Stock, the Board may
    determine that such securities or other property may be held in
    an escrow account, whether such securities or property is issued
    by the Corporation or by another issuer, and such securities or
    other property and any cash or other proceeds thereof received
    by the escrow agent on account of a redemption or other
    transaction affecting such securities or other property shall be
    delivered out of escrow to a Participant or to the Corporation
    at the time of vesting or forfeiture of the related Restricted
    Stock. A Participant will be required to execute any instrument
    or document upon the reasonable request of the Corporation and
    deliver it to the Corporation, including for the purposes of
    enforcing any forfeiture of the Restricted Stock or other
    securities or property referred to in this Section 8.4(a)
    or the proceeds thereof, or otherwise to implement the
    provisions of this Plan or any applicable Award Document
    relating to Restricted Stock.

 

    (b) Stockholder Rights.  Except as
    otherwise provided herein, each Participant shall have all of
    the rights and privileges of a stockholder of the Corporation as
    to his or her Restricted Stock, including the right to receive
    any cash dividends and, subject to Section 8.4(a), other
    dividends declared with respect to such stock and the right to
    exercise voting rights.

 

    (c) Section 83(b) Elections.  A
    Participant who files an election with the Internal Revenue
    Service to include the Fair Market Value of any shares of
    Restricted Stock in gross income while such shares are subject
    to restrictions shall promptly furnish the Committee with a copy
    of such election. The Participant shall be responsible for
    paying the amount of any Federal, state, local, or other taxes
    required to be paid with respect to such election.

 

    8.5  Other Terms of Restricted Stock
    Units.  The Board or Committee shall specify terms
    and conditions applicable to Restricted Stock Units, subject to
    and consistent with the terms of the Plan, including the
    following:

 

    (a) Deferral Period and Settlement.  The
    Board or Committee shall specify periods of deferral and the
    time or times (including events) that shall give rise to
    settlement of Restricted Stock Units. Such deferral periods may
    expire at the same time or later than the time the risk of
    forfeiture of Restricted Stock Units lapses under
    Section 8.2 and terms of the applicable Award Document.
    Restricted Stock Units shall be settled solely by delivery of
    one share of Common Stock for each Restricted Stock Unit to be
    settled; provided, however, that reasonable provisions may be
    made to pay cash in lieu of issuance or delivery of any
    fractional shares.

 

    (b) Dividend Equivalents.  Dividend
    Equivalents shall be credited on previously credited Restricted
    Stock Units, on terms and conditions specified by the Board or
    Committee.

 

    (c) Accounts.  The Board or Committee may
    authorize the creation of bookkeeping accounts to reflect
    transactions and events affecting Restricted Stock Units.

 

    ARTICLE
    IX

    Stock Election

 

    9.1  Election to Receive Stock.  Any
    eligible Director who is entitled to receive Compensation may
    elect to receive all or a portion of such Compensation in the
    form of Common Stock, in lieu of

    

    8

 

    cash, or, if and to the extent authorized under
    Section 9.4, to defer receipt of such Compensation in the
    form of Deferred Stock, in accordance with this Article IX
    and subject to such terms and conditions as may be specified by
    the Board or Committee. A Director shall make such an election
    by executing a Stock Election, on or before such date as may be
    specified by the Board or Committee but not later than
    December 31 preceding the calendar year (the “Plan
    Year”) in which such Compensation would otherwise be
    payable in cash. If an eligible Director is not in office as of
    December 31 preceding a Plan Year, the Director may execute
    a Stock Election for such Plan Year not later than the earlier
    of the day before the date of the first meeting of the Board
    that such Director attends for such Plan Year or the date that
    is 30 days after the date the Director became eligible to
    participate in the Plan, provided that if the Director elects to
    receive Compensation in the form of Deferred Stock, the election
    shall apply only to Compensation for services to be performed
    after the election has been made. Such stock election shall be
    effective upon its receipt by the Corporation.

 

    9.2  Amount of Stock or Deferred
    Stock.  On each date that Compensation would
    otherwise be paid (the “Payment Date”), a Director who
    has made a Stock Election to receive Common Stock hereunder
    shall be entitled to receive a number of shares of Common Stock
    the Fair Market Value of which is equal to the amount of the
    Compensation which would have been paid to such Director had
    such Stock Election not been made, and, if and to the extent
    authorized under Section 9.4, a Director who has made a
    Stock Election to receive Deferred Stock hereunder shall be
    entitled to receive a number of shares of Deferred Stock equal
    to the number of shares of Common Stock the Fair Market Value of
    which is equal to the amount of the Compensation which would
    have been paid to such Director had such Stock Election not been
    made. The number of shares of Common Stock or Deferred Stock to
    be acquired by a Director pursuant to a Stock Election shall be
    determined by dividing the amount of Compensation subject to the
    Stock Election by the Fair Market Value as of the Payment Date.

 

    9.3  Receipt of Common Stock Pursuant to a Stock
    Election.  In the case of a Stock Election to
    receive shares of Common Stock in lieu of Compensation on a
    non-deferred basis, the following terms and conditions apply:

 

    (a) Source of Shares.  The shares of
    Common Stock issued pursuant to such a Stock Election may
    consist of authorized but previously unissued shares, treasury
    shares or shares acquired on the open market on the next
    business date following the Payment Date through the
    Corporation’s transfer agent, Computershare Limited, or any
    successor agent designated by the Committee to act under the
    provisions of this Plan.

 

    (b) Account.  A separate account will be
    maintained by an agent designated by the Corporation for each
    Participant and shares will be allocated to such account under
    this Section 9.3 as of the applicable Payment Date.

 

    (c) Stockholder Rights.  On each Payment
    Date, a Participant shall acquire all of the rights and
    privileges of a stockholder of the Corporation with respect to
    shares issued to him or her pursuant to such a Stock Election
    under the Plan as of such Payment Date, including the right to
    vote on any matter for which the record date for voting is on or
    after such Payment Date and the right to payment of a dividend
    the record date for which is on or after such Payment Date.

 

    (d) Delivery of Shares.  Shares of Common
    Stock acquired under this Section 9.3 shall be delivered to
    the Participant at such time and in such manner as the
    Corporation may reasonably determine. Unless otherwise permitted
    by the officers authorized to administer the Plan, shares
    delivered under this Section 9.3 shall be registered solely
    in the name of the

    

    9

 

    Participant and shall be delivered solely to the Participant
    (or, if deceased, to the Participant’s Beneficiary). If
    Participant has ownership and control of the account specified
    in Section 9.3(b), delivery of shares will be governed by
    the terms of that account.

 

    (e) Fractional Shares.  A Participant (or,
    if deceased, the Participant’s Beneficiary) shall be paid,
    in cash, an amount equal to the value of any fractional share
    credited to the Participant’s account under this
    Section 9.3 quarterly or as otherwise determined by the
    head of Human Resources. For this purpose, the value of a
    fractional share shall be based upon the Fair Market Value of
    the Common Stock on the date of such request or the date of
    termination. Any fractional share for which such a payment is
    made shall be deemed to have been sold on such date. If the
    Participant has ownership and control of the account specified
    in Section 9.3(b), the treatment of any fractional shares
    will be governed by the terms of that account.

 

    (f) Participation in Dividend Reinvestment
    Plan.  A Participant may elect to reinvest
    dividends paid on the shares held in his or her account under
    this Section 9.3 in the purchase of additional shares of
    Common Stock pursuant to any dividend reinvestment plan offered
    by the Corporation to stockholders generally.

 

    9.4  Award of Deferred Stock Pursuant to a Stock
    Election.  The Board may authorize the award of
    Deferred Stock in lieu of Compensation, pursuant to the Stock
    Elections by Directors. In such case, the Board or Committee
    shall specify terms and conditions applicable to such Stock
    Elections and Deferred Stock, subject to and consistent with the
    terms of the Plan, including the following:

 

    (a) Deferral Period and Settlement.  The
    Director shall elect the periods of deferral and the time or
    times (including events) which shall give rise to settlement of
    Deferred Stock, provided that the alternatives that may be
    elected shall be specified by the Board or Committee and shall
    meet the requirements of Section 9.1 and 10.6. Deferred
    Stock shall be settled solely by delivery of one share of Common
    Stock for each share of Deferred Stock to be settled; provided,
    however, that reasonable provisions may be made to pay cash in
    lieu of issuance or delivery of any fractional shares.

 

    (b) Dividend Equivalents.  Unless
    otherwise determined by the Board or Committee, a Participant
    shall be credited with Dividend Equivalents on his or her
    Deferred Stock, which may be payable in cash, on a current or
    deferred basis, or by the crediting of additional Deferred Stock
    having a Fair Market Value equal to the value of such Dividend
    Equivalents, as specified by the Board or Committee.

 

    (c) Accounts.  The Board or Committee may
    authorize the creation of bookkeeping accounts to reflect
    crediting and other transactions and events affecting Deferred
    Stock.

 

    ARTICLE
    X

    General Provisions

 

    10.1  Consideration.  Options,
    Restricted Stock, and Restricted Stock Units will be granted
    under the Plan in order to obtain for the Corporation the
    benefit of the services of Participants and, except for such
    services and the payment of the exercise price of an Option, no
    other consideration shall be required in connection with such
    Awards. The consideration for Common Stock issued or delivered
    pursuant to a Participant’s Stock Election or in settlement
    of Deferred Stock granted pursuant to a Participant’s Stock
    Election will be the Participant’s services during the
    period to which the Compensation paid in the form of Common
    Stock or Deferred Stock relates.

    

    10

 

    10.2  Compliance With Laws and
    Obligations.  The Corporation shall not be
    obligated to issue or deliver Common Stock in connection with
    any Award or take any other action under the Plan in a
    transaction subject to any federal or state law, any requirement
    under any listing agreement between the Corporation and any
    national securities exchange or automated quotation system, or
    any other law, regulation, or contractual obligation of the
    Corporation, until the Corporation is satisfied that such laws,
    regulations, and other obligations of the Corporation have been
    complied with in full. Certificates representing shares of
    Common Stock delivered under the Plan will be subject to such
    stop transfer orders and other restrictions as may be applicable
    under such laws, regulations, and other obligations of the
    Corporation, including any requirement that a legend or legends
    be placed thereon. In addition, the Corporation may affix to any
    shares issued as Restricted Stock an appropriate legend
    reflecting the restrictions imposed under the Plan. The
    Corporation shall make best efforts to satisfy the compliance
    obligations relating to the Plan and Awards in order to avoid
    adverse effects on Participants under this Section 10.2.

 

    10.3  No Right to Continued
    Membership.  Neither the Plan nor any action taken
    hereunder shall be construed as (i) giving any Director the
    right to be retained as a member of the Board of the
    Corporation, or (ii) interfering in any way with the right
    of the Corporation to terminate any Director’s membership
    at any time. Except as expressly provided in the Plan and an
    Award Document, neither the Plan nor any Award Document shall
    confer on any person other than the Corporation and the
    Participant any rights or remedies hereunder or thereunder.

 

    10.4  Changes to the Plan and Awards.

 

    (a) Plan Amendments.  The Committee may,
    with prospective or retroactive effect, amend, alter, suspend,
    discontinue, or terminate the Plan without the consent of
    stockholders or Participants, except that any amendment shall be
    subject to the approval of the Corporation’s stockholders
    at or before the first annual meeting of stockholders for which
    the record date falls on or after the date of such Committee
    action if such amendment is required under Section 303A.08
    of the Listed Company Manual of the New York Stock Exchange or
    is otherwise subject to a requirement of stockholder approval
    under any applicable law or regulation, the rules of any stock
    exchange or automated quotation system on which the Common Stock
    may then be listed or quoted, or the Corporation’s Bylaws.
    In addition, the Committee may otherwise, in its discretion,
    determine that any other such changes to the Plan also shall be
    subject to the approval of the Corporation’s stockholders.
    The foregoing notwithstanding, without the consent of an
    affected Participant, except to the extent required by
    Section 10.2 hereof, no such action may materially impair
    the rights of such Participant under any Award theretofore
    granted. The foregoing notwithstanding, the Committee shall not
    adopt a material amendment to this Section or Section 4.1,
    or adopt an amendment that would be subject to stockholder
    approval under this Section or otherwise would exceed the
    authority of the Committee under its charter and other corporate
    governance documents of the Corporation, without the approval of
    the Board.

 

    (b) Changes to the Terms of Outstanding
    Awards.  The Committee may waive any conditions or
    rights under, or amend, alter, suspend, discontinue, or
    terminate, any Award previously granted and any Award Document
    relating thereto; provided, however, that, except to the extent
    required by Section 10.2 hereof, no such action may
    materially impair the rights of a Participant under such Award
    without the consent of the affected Participant, and provided
    further that, for Awards that are intended to be settled in
    Common Stock per their written terms, cash settlement should be
    rare and only in response to circumstances that are unique,
    outside of the Participant’s control, and perceived to
    result in a hardship to the

    

    11

 

    Participant. Unless otherwise determined by the Committee, such
    cash settlements must receive prior approval of the
    Corporation’s Chief Financial Officer. Modifications that
    are in substance cash settlements are subject to this same
    requirement. The foregoing notwithstanding, the Committee shall
    have no authority to waive or modify any Award term after the
    Award has been granted to the extent the waived or modified term
    would be inconsistent with Section 3.4 (or otherwise would
    not be within the discretion of the Committee if it were then
    granting a new Award).

 

    10.5  Governing Law.  The validity,
    construction, and effect of the Plan, any resolution or program
    implementing the Plan, any rules and regulations under the Plan,
    and any Award Document will be determined in accordance with the
    Federal Home Loan Mortgage Corporation Act of 1970, other
    federal laws regulating the Corporation, and other laws of the
    United States. This Plan and the respective rights and
    obligations of the Corporation and the Participants, except to
    the extent otherwise provided by Federal law, shall be construed
    under the laws of the Commonwealth of Virginia (without giving
    effect to principles of conflicts of laws). The validity,
    enforceability and effectiveness of any electronic records or
    electronic signatures used in connection with any Award Document
    shall be governed by E-SIGN or the Virginia UETA, as applicable.

 

    10.6  Certain Limitations on Awards to Ensure
    Compliance with Code Section 409A.

 

    (a) 409A Deferrals.  Other provisions of
    the Plan notwithstanding, the terms of any Award that
    constitutes a deferral of compensation for purposes of Code
    Section 409A (a “409A Deferral”), including any
    authority of the Corporation and rights of the Participant with
    respect to the 409A Award, shall be limited to those terms
    permitted under Section 409A, and any terms not permitted
    under Section 409A shall be automatically modified and
    limited to the extent necessary to conform with
    Section 409A. The following rules will apply to 409A Awards
    (and other Awards, as indicated):

 

    (i) If a Participant is permitted to make a deferral
    election in connection with the 409A Deferral, including an
    election to defer Compensation, such election will be permitted
    only at times in compliance with Section 409A (including
    transition rules thereunder);

 

    (ii) The Committee may, in its discretion, require or
    permit on an elective basis a change in the distribution terms
    applicable to 409A Awards, and any other Award that qualifies
    for the short-term deferral exemption under Section 409A,
    during 2006 and 2007 in accordance with, and to the fullest
    extent permitted by, Proposed Treasury
    Regulation § 1.409A (including Preamble
    § XI.C) and IRS
    Notice 2005-1,
    and at any time in accordance with Section 409A and
    regulations thereunder. The head of Human Resources of the
    Corporation is authorized to modify any such outstanding Awards
    to permit election of different deferral periods, provided that
    any such modifications may not otherwise increase the benefits
    to Participants or the costs of such Awards to the Corporation;

 

    (iii) The Corporation shall have no authority to accelerate
    distributions relating to 409A Awards in excess of the authority
    permitted under Section 409A;

 

    (iv) Any distribution of a 409A Award triggered by a
    Participant’s termination of service and intended to
    qualify under Section
    409A(a)(2)(A)(i)
    shall be made only at the time that the Participant has had a
    “separation from service” within the meaning of
    Section 409A(a)(2)(A)(i)
    (or earlier at such time, after a termination of service as a

    

    12

 

    Director, that there occurs another event triggering a
    distribution under the Plan or the applicable Award agreement in
    compliance with Section 409A), and any such distribution
    shall otherwise comply with 409A; and

 

    (v) In the case of any distribution of a 409A Award, if the
    timing of such distribution is not otherwise specified in the
    Plan or an Award agreement or other governing document, the
    distribution shall be made not later than 75 days after the
    date at which the settlement of the Award is specified to occur.

 

    (b) Distributions Upon Vesting.  In the
    case of any Award providing for a distribution upon the lapse of
    a risk of forfeiture, if the timing of such distribution is not
    otherwise specified in the Plan or an Award Document or other
    governing document, the distribution shall be made not later
    than March 15 of the year following the year in which the
    risk of forfeiture lapsed.

 

    (c) Scope and Application of this
    Provision.  For purposes of this
    Section 10.6, references to a term or event (including any
    authority or right of the Corporation or a Participant) being
    “permitted” under Section 409A mean that the term
    or event will not cause the Participant to be deemed to be in
    constructive receipt of compensation relating to the 409A Award
    prior to the distribution of shares or cash or other property or
    to be liable for payment of interest or a tax penalty under
    Section 409A.

 

    10.7  Continued Service as an
    Employee.  If a Participant ceases serving as a
    Director and, immediately thereafter, is employed by the
    Corporation or any affiliate, then, solely for purposes of
    Sections 7.3 and 8.3 of the Plan, such Participant will not
    be deemed to have ceased service as a Director at that time, and
    his or her continued employment by the Corporation or any
    subsidiary will be deemed to be continued service as a Director;
    provided, however, that such former Director will not be
    eligible for additional Awards under the Plan.

 

    10.8  Plan Termination; Effect of Amendment and
    Restatement.  The amendment and restatement of the
    Plan shall be effective upon its approval by the stockholders of
    the Corporation by an affirmative vote that meets the
    requirements of the Corporation’s Bylaws and the Listed
    Company Manual of the New York Stock Exchange then in effect.
    Unless earlier terminated by action of the Board or Committee,
    the Plan will remain in effect until such time as no Common
    Stock remains available for delivery under the Plan and the
    Corporation has no further rights or obligations under the Plan
    with respect to outstanding Awards. No Awards shall be made
    under the Plan, including pursuant to Article IX, after the
    Corporation’s Annual Meeting of Stockholders in 2017. Any
    Award granted prior to the effectiveness of the Amendment and
    Restatement of the Plan on March 3, 2007 shall be governed
    by the terms of Articles VII and VIII of the Plan (as
    applicable) as in effect at the time such Award was granted.

    

    13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00144-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00144-of-00352.parquet"}]]