Winners Emerge From Frannie

http://www.1440wallstreet.com/index.php/site/comments/winners_emerge_from_frannie/#When:22:08:00Z

Short Sellers are not the only ones cashing in on the changing of the
guard at Frannie-the CEO's will make out just fine, thanks:



Mr. Syron may walk away with an exit package that could total as
much as $15 million, says David Schmidt, a senior consultant at James
F. Reda & Associates LLC, a compensation consulting concern in New
York. That includes a pension and deferred compensation, about $3.7
million in severance pay, and a possible payment of $8.8 million to
compensate for forfeiting certain equity grants.



Mr. Mudd's exit package, including stock he already owns, could total
$14 million, Mr. Schmidt estimates. That includes $5 million in pension
and deferred compensation, $4.2 million in severance pay and $3.4
million of restricted stock, based on Friday's closing price. That
value of that stock could fall sharply, however. WSJ



Syron walks with up to $8.8 million for forfeiting certain equity grants? It might written into his contract, but that is just wrong.



U.S. Outlines Fan-Fred Takeover

WSJ

Message From Dick Syron

To the Employees of Freddie Mac:

As you have probably heard, the Treasury Department announced today
that it has placed Freddie Mac and Fannie Mae under the conservatorship
of our regulator, the Federal Housing Finance Agency.

Under conservatorship, FHFA will assume direct control of both
companies. FHFA has appointed David Moffett, former Vice Chairman and
CFO of U.S. Bancorp, to succeed me as CEO. He will be joined by an
equally strong non-executive Chairman, John Koskinen. I will retire and
have offered to assist in the transition.

With the turmoil in the housing and mortgage markets over the past
year, the role Freddie Mac and Fannie Mae play in providing affordable
mortgages to homeowners and reliable liquidity to lenders is more
important than ever. The conservatorship process is designed to ensure
that the GSEs continue to fulfill that critical role, despite the
significant increase in credit losses and erosion in capital we have
experienced.

Under the conservatorship process, Treasury will backstop the GSEs,
providing additional capital if future credit losses cause our capital
base to be depleted. This will ensure that we can continue to operate
and fulfill our housing mission.

Treasury Secretary Paulson today said, “I attribute the need for
today’s action primarily to the inherent conflict and flawed business
model embedded in the GSE structure, and to the ongoing housing
correction. GSE managements and their Boards are responsible for
neither.”

We have been through a lot together. Earlier this year we completed
a multi-year accounting restatement, a massive and complex project.
More recently, we have had to manage significant increases in
delinquencies, foreclosures and loan modifications as a result of the
sharp decline in house prices. I am deeply grateful for your commitment
and hard work through all of this, and proud of what we have
accomplished together amid the worst housing market in our lifetimes.

I accepted the CEO position at Freddie Mac at the end of 2003
because I believed in the company’s housing mission. Given the current
turmoil in the housing market, I believe that mission is even more
important today.

As the conservatorship process plays out, I ask you to stay focused
on performing your job responsibilities and give your full support to
Mr. Moffett so that Freddie Mac can continue to fulfill its housing
mission. The vast majority of our employees will see no changes in
their day-to-day activities as a result of the conservatorship process.

It has been a pleasure and an honor to work with all of you.

Sincerely,

Dick


______________________________________

Message From David Moffett

From: Employee Communications


Sent: 09/07/2008 08:57 PM EDT


Subject: E-Mails from Freddie Mac CEO David Moffett and Dick Syron

Good evening, I am David Moffett - the new CEO of Freddie Mac.
Attached below is a letter from former CEO and Chairman Dick Syron,
whose contributions to this company over the past four years are deeply
appreciated. I’ll be communicating with you a lot in the coming days
and weeks, so there’s no need to go into great detail here. For now, I
just want to say a few key things.

I appreciate the long hours that Freddie Mac’s employees have been
putting in to strengthen the company and serve the GSE mission in this
difficult environment. I can only imagine the pressure you have been
under, and the frustrations you must have felt in recent weeks. This
has been a difficult and draining period for all of you. I want to
thank you for your extraordinary service during an extraordinary time.

I’m going to work very hard as CEO to provide the leadership Freddie
Mac needs. I sincerely believe the company has a great opportunity to
improve and strengthen itself during this period with the government’s
support. And I look forward to making the decisions that will help this
company move forward. I would not have taken this job if I was not
deeply supportive of the company’s mission and its essential role in
helping our nation through the toughest housing market in decades.

On Tuesday, we will conduct an All-Employee Town Hall that I would
like you to attend. In the meantime, please stay focused and continue
to conduct the company’s business in the ordinary course.

Treasury Secretary Paulson said in today’s announcement, “Fannie Mae
and Freddie Mac are critical to turning the corner on housing.” I
couldn’t agree more. The expertise and commitment of Freddie Mac’s
employees is a major asset to the company - as well as the country -
and I look forward to meeting you in the coming days.

David Moffett