106 STAT. 3942 PUBLIC LAW 102-550-OCT. 28, 1992

and enforce compliance with the standards and rules that it
establishes;

(7) the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation have an affirmative
obligation to facilitate the financing of affordable housing for
low- and moderate-income families in a manner consistent with
their overall public purposes, while maintaining a strong finan-
cial condition and a reasonable economic return; and

(8) the Federal Home Loan Bank Act should be amended
to emphasize that providing for financial safety and soundness
of the Federal Home Loan Banks is the primary mission of
the Federal Housing Finance Board.

12 USO 4502. SEC. 1803. DEFINITIONS.

For purposes of this title:

(1) AFFILIATE.—Except as provided by the Director, the
term "affiliate" means any entity that controls, is controlled
by, or is under common control with, an enterprise.

(2) CAPITAL DISTRIBUTION.—

(A) IN GENERAL.—The term "capital distribution"
means—

(i) any dividend or other distribution in cash or
in kind made with respect to any shares of, or other
ownership interest in, an enterprise, except a dividend
consisting only of shares of the enterprise;

(ii) any payment made by an enterprise to
repurchase, redeem, retire, or otherwise acquire any
of its shares, including any extension of credit made
to finance an acquisition by the enterprise of such
shares; and

(iii) any transaction that the Director determines
by regulation to be, in substance, the distribution of
capital.

(B) EXCEPTION.—Any payment made by an enterprise
to repurchase its shares for the purpose of fulfilling an
obligation of the enterprise under an employee stock owner-
ship plan that is qualified under section 401 of the Internal
Revenue Code of 1986 or any substantially equivalent plan,
as determined by the Director, shall not be considered
a capital distribution.

(3) COMPENSATION.—The term "compensation" means any
payment of money or the provision of any other thing of current
or potential value in connection with employment.

(4) CORE CAPITAL.—The term "core capital" means, with
respect to an enterprise, the sum of the following (as determined
in accordance with generally accepted accounting principles):

(A) The par or stated value of outstanding common
stock.

(B) The par or stated value of outstanding perpetual,
noncumulative preferred stock.

(C) Paid-in capital.

(D) Retained earnings.

The core capital of an enterprise shall not include any amounts
that the enterprise could be required to pay, at the option
of investors, to retire capital instruments.