EXHIBIT 10.1.2


 


AMENDMENT TO OFFER LETTER


 


EXECUTIVE OFFICER

CHANGE IN CONTROL AGREEMENT


 


This
Agreement (this “Agreement”) is entered into as of the 18th day of May  ,
2009, by and between the FEDERAL HOME LOAN BANK OF BOSTON, a corporation
organized under the laws of the United States (the “Bank”) and Edward A.
Hjerpe, III (the “Executive”).


 


WHEREAS,
the Executive is expected to commence employment as the President and Chief
Executive Officer of the Bank, effective June 30, 2009, or before  ,
2009, and the Bank desires to provide the Executive with certain severance
benefits in the event of a Reorganization (as defined below) of the Bank.


 


NOW,
THEREFORE, in consideration of the promises and the mutual agreements herein
contained, the Bank and the Executive hereby agree as follows:


 


1.                                      Definitions.


 


(a)                                  “Bank”
shall mean the Federal Home Loan Bank of Boston and any other entity within the
definition of “Bank” in Section 5(a) hereof.


 


(b)                                 “Cause”
shall mean (i) the continued failure of the Executive to perform his
duties with the Bank (other than any such failure resulting from disability
(within the meaning of the Bank’s long-term disability plan), after a demand
for performance, pursuant to a resolution of the Bank’s Board of Directors, is
delivered to the Executive by the Chair of the Board of Directors of the Bank,
which specifically identifies the manner in which the Executive has not
performed his duties; (ii) the personal dishonesty, incompetence, willful
misconduct, gross negligence, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, or willful violation of
any law, rule or regulation (other than routine traffic violations or
similar offenses); or (iii) the removal of the Executive for cause by the
Federal Housing Finance Agency or any successor thereto (the “Finance Agency”)
pursuant to 12 U.S.C. 1422b(a)(2) or regulations promulgated thereunder,
any successor or similar statute to 12 U.S.C. 1422b(a)(2) or regulations
promulgated thereunder.


 


(c)                                  “Covered Termination”
shall have the meaning set forth in Section 2(a).


 


(d)                                 “Covered
Termination Period” means the period commencing with the execution by the
Bank of a Reorganization Agreement, and ending on the earlier of (i) twelve
(12) months after the effective date of the related Reorganization or (ii) the
date the Bank formally withdraws from the related Reorganization.


 


(e)                                  “Good Reason”
shall mean the occurrence of any of the following events during the Covered
Termination Period:


 


(i)                                   (A) a
material diminution in the Executive’s base compensation as in effect
immediately prior to the beginning of the period or as the same may


 

















 


be increased from time to
time thereafter or (B) a material diminution in the Executive’s authority,
duties or responsibilities as in effect immediately prior to the beginning of
the period;


 


(ii)                                any material
breach of this Agreement by the Bank; or


 


(iii)                             any change in
the geographic location of the Bank or any successor entity to the Bank by more
than fifty (50) miles.


 


(f)                                    “Reorganization”
of the Bank shall mean the occurrence at any time of any of the following
events:


 


(i)                                   The Bank is
merged or consolidated with or reorganized into or with another bank or other
entity and the Bank is not the surviving entity;


 


(ii)                                The Bank sells
or transfers all, or substantially all of its business and/or assets to another
entity; or


 


(iii)                             The liquidation
or dissolution of the Bank;


 


provided,
that the term “Reorganization” shall include any Reorganization that is
mandated by federal statute, rule, regulation or directive and shall exclude
any Reorganization that is the result of Finance Agency supervisory guidance or
enforcement action taken pursuant to 12 C.F.R. Part 908 or any successor
regulation thereto.


 


(g)                                 “Reorganization
Agreement” means a definitive agreement, the full performance of which
would result in a Reorganization of the Bank.


 


(h)                                 “Release
Agreement” shall mean the Bank’s standard release of claims agreement
executed by the Bank and the Executive under which the Executive releases the
Bank from any and all claims based on losses, damages, liabilities, actions,
suits, costs, expenses, disbursements, taxes and penalties of any kind and
nature whatsoever arising due to the Executive’s employment with the Bank.


 


(i)                                     “Termination
of Employment” shall mean means the severing of employment with the Bank,
voluntarily or involuntarily, for any reason whatsoever, determined in
accordance with the provisions of Internal Revenue Code Section 409A.


 


2.                                      Covered Termination.


 


(a)                                  Covered Termination. For purposes
of this Agreement, a “Covered Termination” means a Termination of Employment
during the Covered Termination Period:


 


(i)                                   By the
Executive for a Good Reason that is not remedied within the cure periods
described in this Section 2(a); or


 


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(ii)                                By the Bank, or
by its successor in a Reorganization, without Cause;


 


provided, that in the case
of a Termination of Employment by the Executive for Good Reason, the Executive
must first provide written notice to the Bank within ninety (90) days of
the initial existence of Good Reason describing the existence of such Good
Reason, and the Bank shall thereafter have the right to remedy the Good Reason
within thirty (30) days of the Bank’s receipt of such written notice. If
the Bank remedies the condition within such thirty (30) day cure period,
then no Good Reason shall be deemed to exist with respect to such condition. If
the Bank does not remedy the condition within such thirty (30) day cure
period, then the Executive may deliver a Notice of Termination for Good Reason
at any time within sixty (60) days following the expiration of such cure
period.


 


(b)                                 Non-Covered
Termination. For the avoidance of doubt, none of the following
events shall result in any payment to the Executive for a Covered Termination
under Section 3(a):


 


(i)                                   A Termination
of Employment by the Executive without Good Reason;


 


(ii)                                A Termination
of Employment for Cause by the Bank or its successor in a Reorganization;


 


(iii)                             A Termination
of Employment without Cause that does not occur within the Covered
Termination Period; or


 


(iv)                            A Termination
of Employment due to death, disability (within the meaning of the Bank’s
long-term disability plan) or a voluntary retirement.


 


3.                                      Payment for Covered Termination.


 


(a)                                  In the event of
a Covered Termination, subject to the Executive’s execution of a Release
Agreement no later than twenty-one (21) days (or, at the discretion of the
Bank, up to forty-five (45) days) after the Executive’s Termination of
Employment and non-revocation of such Release Agreement, the Bank shall pay the
Executive an amount equal to one (1) times the annualized base salary of
the Executive at the time of the Executive’s Termination of Employment with the
Bank (or, if higher, upon an event constituting Good Reason). Such amount shall
be distributed to the Executive in equal installments over twelve (12) months
following the Termination of Employment, to be paid according to the Bank’s
regular payroll cycle during such period.


 


(b)                                 Notwithstanding
Section 3(a), if the Bank is not in compliance with any applicable
statutory or regulatory capital or leverage requirements or if the payment
would cause the Bank to fall below applicable statutory or regulatory
requirements, then such payments shall be deferred until such time as the Bank
or any successor achieves compliance with its statutory and regulatory
requirements. The Bank shall make such payments at the earliest date at which
the Bank


 


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reasonably anticipates that
the making of the payments will not cause a violation of the statutory and
regulatory requirements described in this paragraph.


 


(c)                                  The Executive
shall be responsible for the payment of all federal, state and local income
taxes which may be due with respect to any payments made to the Executive
pursuant to this Agreement.


 


(d)                                 The payment of
severance benefits pursuant to this Section 3 shall be in lieu of any
severance benefits that would otherwise be payable to the Executive under any
severance plan or policy maintained by the Bank during the Covered Termination
Period.


 


(e)                                  The Executive
acknowledges that the Bank will comply with any applicable statutory and/or
regulatory requirements relating to the payment of the amounts under this Section 3.
Should a governmental authority, or a court upon application by a governmental
authority, having jurisdiction over the matter direct that any portion or all
of the amounts provided in this Section 3 may not be paid to the Executive
by the Bank, the Executive agrees that (i) he will not be entitled to
payments under this Section 3 to the extent that such payments would
violate any statutory and/or regulatory requirements that apply to the Bank,
and (ii) if previously paid, he will return to the Bank the amount of such
payment specified in such order, without adjustment for investment earnings or
losses, net of applicable taxes the Executive paid on such payment.  Such
repayment shall be made to the Bank within fifteen (15) business days after
written demand by the Bank is delivered to the Executive.  If any
proceeding is commenced in which the legality of any of the payments made or to
be made under this Agreement is at issue, the Bank will provide the Executive
with written notice promptly after it has knowledge thereof.


 


4.                                      No Mitigation. The Executive
shall not be required to seek other employment, nor shall any payment made
under this Agreement be reduced by any compensation received from other
employment.


 


5.                                      Successor to the Bank.


 


(a)                                  This Agreement
is binding upon the successors and assigns of the Bank. The Bank and its
successors and assigns will require any successor or assign (whether direct or
indirect, in a Reorganization, by operation of law, or otherwise) to all or
substantially all of the business and/or assets of the Bank, to enter into a
written agreement in form and substance satisfactory to the Executive,
expressly, absolutely and unconditionally to assume and agree to perform this
Agreement in the same manner and to the same extent that the Bank would be
required to perform it if no such succession or assignment had taken place. In
the event of a Covered Termination, the Bank agrees that it shall pay or shall
cause such employer to pay any amounts owed to the Executive pursuant to Section 3
hereof.


 


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As
used in this Agreement, “Bank” shall mean the Bank as defined herein and any
successor or assign to its business and/or assets as aforesaid which executes
and delivers the agreement provided for in this Section 5 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law. If at any time during the term of this Agreement the
Executive is employed by any corporation a majority of the voting securities of
which is then owned by the Bank, the term “Bank” shall include such employer.
Whether or not another entity becomes the successor or assign of the Bank under
this Agreement, the maximum amount which the Executive may receive from all
sources under this Agreement in a Covered Termination shall be the amounts set
forth in Section 3 hereof.


 


(b)                                 This Agreement
shall inure to the benefit of and be enforceable by the Executive’s personal
and legal representatives, executors, administrators, successors, heirs,
distributees, and legatees. If the Executive should die while any amounts are
still payable to him hereunder, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the
beneficiary designated by notice in writing executed by the Executive and filed
with the Bank, or failing such designation, to the Executive’s estate.


 


6.                                      Employment Rights. This Agreement
shall not confer upon the Executive any right to continue in the employ of the
Bank and shall not in any way affect the right of the Bank to dismiss or
otherwise terminate the Executive’s employment at any time and for any reason
with or without cause. This Agreement is not intended (a) to be an
employment agreement or (b) to define all aspects of the employment
relationship between the Bank and the Executive, including but not limited to
applicable employment or benefit policies of the Bank. To the extent there is
any conflict between the terms hereof and the terms of any employment or
benefit policies of the Bank, the terms of this Agreement shall control.


 


7.                                      Tax Withholding. The Bank will
withhold from any amounts payable to the Executive under this Agreement to
satisfy all applicable federal, state, local or other withholding taxes. All
amounts payable under Section 3(a) are considered “wages” to be
reported on Form W-2. The normal withholding rules for wages apply. To
the extent required, the Bank will also withhold any excise taxes owed under
Code Section 4999.


 


8.                                      Notice. For purposes of this
Agreement, notices and all other communications provided for in the Agreement
shall be in writing and shall be deemed to have been duly given when delivered
by hand, delivered by a nationally-recognized overnight courier service, or
mailed by United States registered mail, return receipt requested, postage
prepaid, as follows:


 


If
to the Bank:


 


Federal
Home Loan Bank of Boston


111
Huntington Avenue, 24th Floor


Boston,
MA 02199-7614


Attention:
Chair of the Board of Directors


 


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With
a copy to the Chair of the Personnel Committee of the Board of Directors


 


If
to the Executive:


 


Mr. Edward
A. Hjerpe, III


(at
home address)


 


or
such other address as either party may have furnished to the other in writing
in accordance herewith. Any notice shall be effective upon receipt.


 


9.                                      Legal Fees and Expenses. The Bank shall
reimburse all reasonable out-of-pocket legal fees and expenses which the
Executive has actually incurred as a result of the Bank’s contesting in bad
faith the validity or enforceability of this Agreement or the calculation of
amounts payable hereunder, with the fees and expenses to be paid promptly by
the Bank and in any event no later than March 15th of the year immediately following the year in
which such fees and expenses were incurred.


 


10.                               Term. This Agreement shall become effective on the date the Executive
commences his employment with the Bank (the “Commencement Date”) and
shall terminate upon the Executive’s Termination of Employment (except to the
extent obligations remain following a Covered Termination).


 


11.                               Acknowledgement
of Public Filing Requirements. The Executive
hereby acknowledges and agrees that (i) the Executive’s position
constitutes a “named executive officer” within the meaning of Item 402(a)(3) of
Regulation S-K (or any successor regulation); and (ii) this Agreement is a
compensatory agreement that the Bank, as a Securities and Exchange Commission (“SEC”)
registrant, must file and describe in public filings with the SEC in accordance
with applicable securities laws and SEC regulations.


 


12.                               Miscellaneous.


 


(a)                                  No Modification. No provisions
of this Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing signed by the party or
parties hereto to be bound.


 


(b)                                 No Waiver. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.


 


(c)                                  Entire
Agreement. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not set forth expressly in this Agreement.


 


(d)                                 Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts (excluding 


 


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conflict of laws
principles), except to the extent such law is preempted by the federal laws of
the United States.


 


(e)                                  Pleadings. Section or
paragraph headings contained herein are for convenience of reference only and
are not to be considered a part of this Agreement.


 


(f)                                    Validity. The
invalidity or unenforceability of any provisions of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.


 


(g)                                 Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same instrument.


 


 


IN
WITNESS WHEREOF, this Agreement is executed as of the date first written above
and is effective as of the Commencement Date.


 


 


	
  THE
  EXECUTIVE:

  	
   

  	
  FEDERAL
  HOME LOAN BANK OF BOSTON:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  
	
   /s/ 
  Edward A. Hjerpe III

  	
   

  	
   

  	
   /s/
  Jan A. Miller

  
	
   

  	
   

  	
   

  	
   

  
	
  Edward
  A. Hjerpe, III

  	
   

  	
   

  	
  Jan
  A. Miller 

  
	
   

  	
   

  	
   

  	
  Chair,
  Board of Directors

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  
	
   

  	
   

  	
   

  	
   /s/
  Mark E. Macomber

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Mark
  E. Macomber 

  Chair, Personnel Committee of the Board of Directors

  
					



 


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