The American Pundit

It would appear that AIG isn’t the only bailed out entity with an executive retention bonus plan. Freddie Mac, the mortgage giant and recipient of $200 billion along with its sister Fannie Mae corporation, has filed an annual report revealing a pretty generous bonus plan.

Under the established plan, senior and executive vice presidents are eligible for four bonus payouts, only the last one being based on performance. Freddie explains the goal of the plan:

Objective To retain as many people as possible for 18 months (through March, 2010) in order to:

* Maintain maximum operational stability
* Allow time to evaluate the fundamental business model
* Fulfill Freddie Mac’s goal of re-establishing stability and liquidity to the mortgage market

Retention Period Retention Period runs from September 2008 through March 2010.

General Eligibility All Senior Vice Presidents and Executive Vice Presidents who are employees of Freddie Mac on or after September 1, 2008 are eligible to participate in the program.

So, how will this all work?

Payout Timing The aggregate retention award for each individual will be paid in the regular payroll cycle occurring immediately after the following dates …

* 1     20%     December 15, 2008
* 2     20%     August 1, 2009
* 3     25%     December 15, 2009
* 4     35%     March 15, 2010

Payment Numbers 1, 2, and 3 will be based solely in the individual’s continued employment with Freddie Mac the through the indicated payment dates.

Performance Requirements Payment Number 4 will be conditioned upon achievement of specific performance objective(s) that will be determined during the upcoming business planning process.

So the first three bonuses to executives will be sent out regardless of how well the company performs. And this plan was actually established months after the company received taxpayer bailouts.

How long before Barack Obama is pounding the podium and Barney Frank is threatening that heads will roll over this one?

(By the way, this is a great catch by Hot Air’s Ed Morrissey. Props for the original reporting.)