Document:

Nov 21, 2012 Additional Facility AF Accession Agreement

Exhibit 4.1

US $500,000,000 ADDITIONAL FACILITY AF ACCESSION AGREEMENT
To:    The Bank of Nova Scotia as Facility Agent and Security Agent
From:    The persons listed in Schedule 1 to this Additional Facility AF Accession Agreement (the Additional Facility AF Lenders,  such defined term to include any lender which becomes a New Lender in respect of Facility AF, by the execution by the Facility Agent of a Novation Certificate substantially in the form of Schedule 3 or Schedule 4 to this Additional Facility AF Accession Agreement)
Date:    21 November 2012
UPC Broadband Holding B.V. (formerly known as UPC Distribution Holding B.V) - €1,072,000,000 Term Credit Agreement dated 16 January 2004 as amended from time to time (the Credit Agreement)
		
	1.
	In this Additional Facility AF Accession Agreement:

Facility AF means the US $500,000,000 term loan facility made available under this Agreement.
Facility AF Advance means a US Dollar denominated advance made to UPC Financing by the Additional Facility AF Lenders under Facility AF.
Facility AF Commitment means, in relation to an Additional Facility AF Lender, the amount in US Dollars set opposite its name under the heading "Facility AF Commitment" in Schedule 1 to the counterpart of this Additional Facility Accession Agreement executed by that Additional Facility AF Lender, to the extent not cancelled, transferred, or reduced under the Credit Agreement.
Facility AB means the US $500,000,000 term loan facility made available as an Additional Facility under the Credit Agreement and pursuant to an Additional Facility Accession Agreement dated 25 October 2011.
Facility AB Interest Period means the Interest Period currently selected (as at the date of this Agreement) in respect of the outstanding Advance under Facility AB.
		
	2.
	Unless otherwise defined in this Additional Facility AF Accession Agreement, terms defined in the Credit Agreement shall have the same meaning in this Additional Facility AF Accession Agreement and a reference to a Clause is a reference to a Clause of the Credit Agreement.  The principles of construction set out in Clause 1.2 (Construction) of the Credit Agreement apply to this Agreement as though they were set out in full in this Additional Facility AF Accession Agreement.

		
	3.
	We refer to Clause 2.2 (Additional Facilities) of the Credit Agreement.

		
	4.
	This Additional Facility AF Accession Agreement will take effect on the date on which the Facility Agent notifies UPC Broadband and the Additional Facility AF Lenders that it has received the documents and evidence set out in Schedule 2 to this Additional Facility AF Accession Agreement, in each case in form and substance satisfactory to it or, as the case may be, the requirement to provide any of such documents or evidence has been waived by the Facility Agent on behalf of the Additional Facility AF Lenders (the Effective Date).

		
	5.
	We, the Additional Facility AF Lenders, agree: 

		
	(a)
	to become party to and to be bound by the terms of the Credit Agreement as Lenders in accordance with Clause 2.2 (Additional Facilities) of the Credit Agreement; and 

		
	(b)
	to become party to the Security Deed as Lenders and to observe, perform and be bound by the terms and provisions of the Security Deed in the capacity of Lenders in accordance with Clause 9.3 (Transfers by Lenders) of the Security Deed.

		
	6.
	The Additional Facility Commitment in relation to an Additional Facility AF Lender (for the purpose of the definition of Additional Facility Commitment in Clause 1.1 (Definitions) of the Credit Agreement) is its Facility AF Commitment.

		
	7.
	Any interest due in relation to Facility AF will be payable on the last day of each Interest Period in accordance with Clause 8 (Interest) of the Credit Agreement.

		
	8.
	The Additional Facility Availability Period for Facility AF shall be the period from and including the Effective Date up to and including 5.00pm New York time on 31 December 2012.

		
	9.
	Facility AF may be drawn by one Advance and no more than one Request may be made in respect of Facility AF under the Credit Agreement.

		
	10.
	The Facility AF Advances will be used for general corporate purposes and working capital purposes, including the repayment or prepayment of existing indebtedness.

		
	11.
	The first Interest Period to apply to the first Facility AF Advance will be a period equal to the period running from the Utilisation Date specified in the relevant Request up to (but excluding) the last day of Facility AB Interest Period.

		
	12.
	The Final Maturity Date in respect of this Facility AF will be 31 January 2021.

		
	13.
	The outstanding Facility AF Advances will be repaid in full on the Final Maturity Date.

		
	14.
	The Margin in relation to Facility AF is 3.00 per cent. per annum.

		
	15.
	The Borrower in relation to Facility AF is UPC Financing.

		
	16.
	The interest rate for Facility AF will be calculated in accordance with Clause 8.1 (Interest rate) of the Credit Agreement, being the sum of LIBOR, the applicable Margin and the Mandatory Costs. For the avoidance of doubt, each party to this Agreement accepts and acknowledges that LIBOR has the meaning given to it under Clause 1.1 (Definitions) of the Credit Agreement and that if, at the time of calculation, the rate is determined to be below 1.00 per cent. then LIBOR will be deemed to be 1.00 per cent.

17.    
		
	(a)
	At any time during the twelve-month period beginning on the date of this Additional Facility AF Accession Agreement, upon the occurrence of a voluntary prepayment of any or all of Facility AF by the Borrower pursuant to Clause 7.3 (Voluntary prepayment) of the Credit Agreement, the Borrower agrees to pay to the Facility Agent (for the account of each of the Additional Facility AF Lenders on a pro rata basis) a prepayment fee (in addition to the principal amount of the prepayment) in an amount equal to 1 per cent. of the principal amount of the outstanding Facility AF 

Advance being prepaid, plus accrued and unpaid interest then due on the amount of the outstanding Facility AF Advance prepaid to the date of prepayment.
		
	(b)
	Such payment shall be due and payable by the Borrower to the Facility Agent (for the account of each of the Additional Facility AF Lenders on a pro rata basis) on the actual date of such prepayment. 

18.    
		
	(a)
	Provided that any upsizing of Facility AF permitted under this paragraph will not breach any term of the Credit Agreement, Facility AF may be upsized by any amount, by the signing of one or more further Additional Facility AF Accession Agreements, that specify (along with the other terms specified therein) UPC Financing as the sole Borrower and which specify Additional Facility AF Commitments denominated in US Dollars, to be drawn in US Dollars, with the same Final Maturity Date and Margin as specified in this Additional Facility AF Accession Agreement.

(b)    For the purposes of this paragraph 18 (unless otherwise specified), references to Additional Facility AF Lenders and Facility AF Advances shall include Lenders and Advances made under any such further and previous Additional Facility AF Accession Agreement.
(c)    Where any Facility AF Advance has not already been consolidated with any other Facility AF Advance, on the last day of any Interest Period for unconsolidated Facility AF Advance, that Facility AF Advance will be consolidated with any other Facility AF Advance which has an Interest Period ending on the same day as that unconsolidated Facility AF Advance, and all such Facility AF Advances will then be treated as one Advance.
		
	19.
	For the purposes of any amendment or waiver (including with respect to any existing Default or Event of Default) that may be sought by UPC Broadband and UPC Financing under the Credit Agreement on or after the date of this Additional Facility AF Accession Agreement, the Additional Facility AF Lenders hereby consent to any and all of the following (and this Agreement shall constitute each Additional Facility AF Lenders' irrevocable and unconditional written consent for the purposes of Clause 25 of the Credit Agreement without any further action required on the part of any Party): 

		
	(a)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to provide that an “Additional Facility Commitment” and an “Advance” (and any participation therein) as set forth in Clause 1.1 of the Credit Agreement shall be deemed to be cancelled (with respect to any Additional Facility Commitment) and not outstanding (with respect to any Advance) for purposes of voting or consents (other than any vote or consent related to non-payment of such Advance) under the Credit Agreement if UPC Broadband Holding has delivered to the Facility Agent a duly completed Cancellation Notice with respect to such Additional Facility Commitment or Advance; provided that any such Advance shall remain due and payable on the applicable prepayment date and, if not repaid in full on the applicable prepayment date, then all voting or consent rights with respect thereto shall be reinstated with retroactive effect from the date of delivery of such Cancellation Notice;

		
	(b)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to change the definition of “Western Europe” in Clause 1.1 of the 

Credit Agreement to include the countries that comprise the European Union as of a specified date more recent than the Effective Date, or from time to time (in addition to Scandinavia and Switzerland);
		
	(c)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to change the definition of “Acquisition Business Plan” and the definition of “Borrower Group Business Plan” in Clause 1.1 of the Credit Agreement to limit the time period covered by any business plan of the Target or, as applicable, the Borrower Group (including the Target) to a period of not less than the earlier of five years following the date of the relevant Acquisition and the Final Maturity Date;

		
	(d)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to eliminate the limitations set forth in subclause (b)(i) of the definition of “Permitted Acquisition” in Clause 1.1 of the Credit Agreement and in subclause (b)(i) of the definition of “Permitted Joint Venture” in Clause 1.1 of the Credit Agreement with respect to businesses conducted in Great Britain and/or Germany;

		
	(e)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to eliminate the requirements set forth in subclause (b)(ii)(A)(II) of the definition of “Permitted Acquisition” in Clause 1.1 of the Credit Agreement and in subclause (b)(ii)(A)(II) of the definition of “Permitted Joint Venture” in Clause 1.1 of the Credit Agreement to deliver the financial projections specified therein, or to reduce the time period for compliance stated in either subclause;

		
	(f)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to increase the amount of secured indebtedness specified  in subclause (n) of the definition of “Permitted Security Interest” in Clause 1.1 of the Credit Agreement from €15,000,000 to an amount not to exceed €100,000,000 (or its equivalent);

		
	(g)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to eliminate the reporting requirements set forth in subclause (c) of Clause 16.2 of the Credit Agreement, or to change the time period for compliance specified therein;

		
	(h)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to include as a “Permitted Disposal” under Clause 16.10(b)(xvi) of the Credit Agreement the disposal of any person or asset if:  (i) at the time of such disposal, UPC Broadband has contractually committed or agreed to a future Acquisition and such an  Acquisition occurs within twelve months (or less) of the  disposal;  (ii) the Remaining Percentage would not be exceeded if the aggregate percentage value of the contemplated Acquisition is added to the calculation and tested at the time of the disposal  on a pro forma basis (giving effect to the Annualised EBITDA of the Target based on then available historical financial information) and on an actual basis at the completion of the Acquisition (and for these purposes (A) subclause 16.10(c)(z) of the Credit Agreement would be disapplied so that the Remaining Percentage could exceed 17.5 per cent. in respect of the relevant disposal and (B) subclause 16.10(c)(x) of the Credit Agreement would be disapplied so that the percentage of the Annualised EBITDA of the Borrower Group represented by the Annualised EBITDA of the relevant disposal could be more than the Remaining Percentage immediately prior to such disposal, in each case provided the Remaining Percentage would not be exceeded once any contemplated Acquisition is taken into account as described in this subparagraph (ii)); and (iii) for the purpose 

of the certificate required in Clause 16.10(b)(xvi)(C), the financial ratios are calculated giving pro forma effect to such Acquisition (based on the then available historical financial information of the Target and including the Annualised EBITDA of the Target and any Financial Indebtedness expected to be incurred by the Borrower Group to finance such Acquisition) (and any such amendment, waiver or other modification contemplated by this subclause (h) may apply to all such disposals and future Acquisitions or only to specified disposals and Acquisitions); 
		
	(i)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to eliminate the provision set forth in subclause (c)(y) of Clause 16.10 of the Credit Agreement that the percentage value of a Reinvestment shall be disregarded if the Annualised EBITDA of the members of the Borrower Group derived from persons or assets located in Western Europe is less than 662⁄3 per cent. of the Annualised EBITDA of the Borrower Group, or to change the percentage or the geographical limitation specified therein;

		
	(j)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to increase the amount of Financial Indebtedness specified in Clause 16.12(b)(xvii) of the Credit Agreement from €25,000,000 to an amount not to exceed €100,000,000 (or its equivalent);

		
	(k)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to change the calculation of any financial ratio that requires the calculation of Senior Debt and/or Total Debt to provide for the netting of cash and cash equivalents (to be defined substantially in line with and/or with reference to standard language used in the European banking market) against Senior Debt and/or Total Debt; 

		
	(l)
	any amendment, waiver or other modification to the Credit Agreement or any other Finance Document to provide that, for purposes of measuring EBITDA in connection with any acquisition or similar transaction, EBITDA shall be calculated on a pro forma basis, as determined in good faith by a responsible financial or accounting officer of the Borrower, to give effect to anticipated expense and cost reductions; and

		
	(m)
	any consequential amendment, waiver or other modification to the Credit Agreement or any other Finance Document arising as a direct result of the changes envisaged in subclauses (a) to (l) of this Clause 19. 

The Additional Facility AF Lenders hereby waive receipt of any fee in connection with the foregoing consent, notwithstanding that other consenting Lenders under the Credit Facility may be paid a fee in consideration of such Lenders’ consent to any or all of the foregoing amendments, waivers or other modifications.
		
	20.
	We hereby acknowledge and agree that the Facility Agent may, but shall not be required to, send us any further formal amendment request in connection with all, or any of the proposed amendments set out under Clause 19 above and the Facility Agent shall be authorised to consent on our behalf, as a Lender under one or more Additional Facility, to any such proposed amendments set out under Clause 19 above, and such consent shall be taken into account in calculating whether the Majority Lenders, or the relevant requisite Lenders, have consented to the relevant amendments and/or waiver to the Agreement in accordance with clause 25 (Amendments and Waivers) of the Agreement.

		
	21.
	Each of UPC Broadband and UPC Financing confirms, on behalf of themselves and each other Obligor that the representations and warranties set out in Clause 15 (Representations 

and Warranties) of the Credit Agreement (with the exception of Clauses 15.6(a) (Consents), 15.10 (Financial condition), 15.12 (Security Interests), 15.13(b) (Litigation and insolvency proceedings), 15.14 (Business Plan), 15.15 (Tax liabilities), 15.16 (Ownership of assets), 15.18 (Works Council), 15.19 (Borrower Group Structure), 15.20 (ERISA), 15.24 (UPC Financing) and 15.25 (Dutch Banking Act)) are true and correct as if made at the Effective Date with reference to the facts and circumstances then existing, and as if each reference to the Finance Documents includes a reference to this Additional Facility AF Accession Agreement.
		
	22.
	UPC Broadband further represents and warrants on the Effective Date that the execution and delivery by it of this Additional Facility AF Accession Agreement and the performance of the transactions contemplated by this Additional Facility AF Accession Agreement will not violate any agreement or instrument to which UPC Holding is a party or binding upon UPC Holding or any member of the Borrower Group or any assets of UPC Holding or any member of the Borrower Group's assets, where such violation would or is reasonably likely to have a Material Adverse Effect.

		
	23.
	Each Additional Facility AF Lender confirms to each Finance Party that:

		
	(a)
	it has made its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in the Credit Agreement and has not relied on any information provided to it by a Finance Party in connection with any Finance Document; and

		
	(b)
	it will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities while any amount is or may be outstanding under the Credit Agreement or any Additional Facility Commitment is in force.

		
	24.
	Each of the Additional Facility AF Lenders agrees that without prejudice to Clause 26.3 (Procedure for novations) of the Credit Agreement, each New Lender (as defined in either Novation Certificate referred to below) shall become, by the execution by the Facility Agent of a Novation Certificate substantially in the form of either Schedule 3 or Schedule 4, as applicable, to this Additional Facility AF Accession Agreement, bound by the terms of this Additional Facility AF Accession Agreement as if it were an original party hereto as an Additional Facility AF Lender and shall acquire the same rights, grant the same consents and assume the same obligations towards the other parties to this Additional Facility AF Accession Agreement as would have been acquired, granted and assumed had the New Lender been an original party to this Additional Facility AF Accession Agreement as an Additional Facility AF Lender.

		
	25.
	The Facility Office and address for notices of each Additional Facility AF Lender for the purposes of Clause 32.2 (Addresses for notices) of the Credit Agreement will be that notified by each Additional Facility AF Lender to the Facility Agent.

		
	26.
	This Additional Facility AF Accession Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

		
	27.
	This Additional Facility AF Accession Agreement may be executed in any number of counterparts, and by each party on separate counterparts.  Each counterpart is an original, but all counterparts shall together constitute one and the same instrument.  Delivery of an executed counterpart signature page of this Additional Facility AF Accession Agreement by e-mail (PDF) or telecopy shall be as effective as delivery of a manually executed counterpart of this Additional Facility AF Accession Agreement.  

SCHEDULE 1
ADDITIONAL FACILITY AF LENDERS AND COMMITMENTS

	
		
	Additional Facility AF Lender
	Facility AF Commitment
(US $)

	Liberty Global Services B.V. (formerly known as UPC Broadband Operations B.V.)
	500,000,000

	 
	 

	Total
	500,000,000

SCHEDULE 2
CONDITIONS PRECEDENT DOCUMENTS
		
	1.
	Constitutional Documents

		
	(a)
	A copy of the constitutional documents of each Obligor (other than UPC Financing) and the partnership agreement of UPC Financing or, if the Facility Agent already has a copy, a certificate of an authorised signatory of the relevant Obligor confirming that the copy in the Facility Agent's possession is still correct, complete and in full force and effect as at a date no earlier than the date of this Additional Facility AF Accession Agreement.

		
	(b)
	An extract of the registration of each Obligor established in the Netherlands in the trade register of the Dutch Chamber of Commerce.

		
	2.
	Authorisations

		
	(a)
	A copy of a resolution of the board of managing and, to the extent applicable, board of supervisory directors (or equivalent) and, to the extent that a shareholders' resolution is required, a copy of the shareholders' resolution of each Obligor:

		
	(i)
	approving the terms of and the transactions contemplated by this Additional Facility AF Accession Agreement and (in the case of each of UPC Broadband and UPC Financing) resolving that it execute the same (and, in the case of the Guarantors and the Charging Entities (as defined in the Security Deed) resolving that it execute the confirmation described at paragraph 4(a) below; and

		
	(ii)
	(in the case of UPC Broadband and UPC Financing) authorising the issuance of a power of attorney to a specified person or persons to execute this Additional Facility AF Accession Agreement on its behalf and (in the case of the Guarantors and the Charging Entities (as defined in the Security Deed)) authorising the issuance of a power of attorney to a specified person or persons to execute the confirmation described in paragraph 4(a) below.

		
	(b)
	A specimen of the signature of each person authorised pursuant to its constitutional documents or to the power of attorney referred to in paragraph (a) above to sign this Additional Facility AF Accession Agreement or the confirmation described in paragraph 4(a) below (as appropriate).

		
	(c)
	A certificate of an authorised signatory of UPC Broadband, each Guarantor and each Charging Entity certifying that each copy document specified in this Schedule and supplied by UPC Broadband, each Guarantor and each Charging Entity is correct, complete and in full force and effect as at a date no earlier than the date of this Additional Facility AF Accession Agreement.

		
	(d)
	A copy of any other authorisation or other document, opinion or assurance which the Facility Agent has notified UPC Broadband is necessary in connection with the entry into and performance of, and the transactions contemplated by, this Additional Facility AF Accession Agreement or for the validity and enforceability of this Additional Facility AF Accession Agreement.

		
	3.
	Legal opinions

		
	(a)
	A legal opinion of Allen & Overy LLP, English legal advisers to the Facility Agent, addressed to the Finance Parties.

		
	(b)
	A legal opinion of Allen & Overy LLP, Dutch legal advisers to the Facility Agent, addressed to the Finance Parties.

		
	(c)
	A legal opinion of Allen & Overy LLP, New York legal advisers to the Facility Agent, addressed to the Finance Parties.

		
	4.
	Other documents

Confirmation (in writing) from (i) each of the Guarantors that its obligations under Clause 14 (Guarantee) of the Credit Agreement and (ii) each of the Charging Entities (as defined in the Security Deed) that the Security Interests granted to the Beneficiaries pursuant to the Security Documents and its obligations under the Finance Documents, shall continue unaffected and that such obligations extend to the Total Commitments as increased by the addition of Facility AF and that such obligations shall be owed to each Finance Party including the Additional Facility AF Lenders.

SCHEDULE 3
NOVATION CERTIFICATE (CASHLESS)
To:    The Bank of Nova Scotia as Facility Agent and UPC Financing as Borrower
From:    Liberty Global Services B.V. (formerly known as UPC Broadband Operations B.V.) and [the EXISTING AB LENDER / NEW AF LENDER]

Date:                         
UPC Broadband Holding B.V. - €1,072,000,000 Term Credit Agreement dated 16 January 2004 (as amended from time to time)(the Credit Agreement)
We refer to: 
		
	(a)
	Clause 26.3 (Procedure for novations) of the Credit Agreement;

		
	(b)
	Clause 9.3 (Transfers by the Lenders) of the Security Deed;

		
	(c)
	the Accession Agreement dated 25 October 2011, pursuant to which a US $500,000,000 term loan facility is made available to the Borrower as an Additional Facility (Additional Facility AB) under the Credit Agreement (the Additional Facility AB Accession Agreement); and

		
	(d)
	the Accession Agreement dated [l] 2012, pursuant to which a US $500,000,000 term loan facility is made available to the Borrower as an Additional Facility (Additional Facility AF) under the Credit Agreement (the Additional Facility AF Accession Agreement).

Unless defined in this Novation Certificate, terms defined in the Credit Agreement or, if not defined in the Credit Agreement, the Additional Facility AF Accession Agreements, have the same meaning in this Novation Certificate.
		
	1.
	[●] (the Existing AB Lender) agrees to novate and Liberty Global Services B.V. (formerly known as UPC Broadband Operations B.V.) (the New AB Lender) agrees to accept novation on the Effective Date, of all the Existing AB Lender's rights and obligations referred to in the Schedule in accordance with Clause 26.3 (Procedure for novations) of the Credit Agreement and clause 9.3 (Transfers by the Lenders) of the Security Deed.

		
	2.
	Liberty Global Services B.V. (formerly known as UPC Broadband Operations B.V.) (the Existing AF Lender) agrees to novate and [●] (the New AF Lender) agrees to accept the novation on the Effective Date of all the Existing AF Lender's rights and obligations referred to in the Schedule in accordance with Clause 26.3 (Procedure for novations) of the Credit Agreement and clause 9.3 (Transfers by the Lenders) of the Security Deed.

		
	3.
	The New AB Lender confirms that it is bound by the terms of the Additional Facility AB Accession Agreement as if it were an original party thereto as an Additional Facility AB Lender and shall acquire the same rights and assume the same obligations towards the other parties to the Additional Facility AB Accession Agreement as would have been acquired and assumed had the New AB Lender been an original party to the Additional Facility AB Accession Agreement as an Additional Facility AB Lender (as defined in the Additional Facility AB Accession Agreement).

		
	4.
	The New AF Lender confirms that it is bound by the terms of the Additional Facility AF Accession Agreement as if it were an original party thereto as an Additional Facility AF Lender and shall acquire the same rights, provide the same consents and assume the same obligations towards the other parties to the Additional Facility AF Accession Agreement as would have been acquired, granted and assumed had the New AF Lender been an original party to the Additional Facility AF Accession Agreement as an Additional Facility AF Lender.

		
	5.
	For the purposes of this Novation Certificate, “Effective Date” means the date on which the Facility Agent countersigns this certificate.

		
	6.
	Each party to this document agrees, the Facility Agent agrees on behalf of each Finance Party, and UPC Broadband Holding B.V. agrees on behalf of each Obligor, that this document is a Novation Certificate notwithstanding that its form is different to that required by the Credit Agreement.

		
	7.
	This Novation Certificate is a Finance Document.

		
	8.
	This Novation Certificate may be executed in any number of counterparts, and by each party on separate counterparts.  Each counterpart is an original, but all counterparts shall together constitute one and the same instrument.  Delivery of an executed counterpart signature page of this Novation Certificate by e-mail (PDF) or telecopy shall be as effective as delivery of a manually executed counterpart of this Novation Certificate.

		
	9.
	This Novation Certificate and any non-contractual obligations arising out of or in connection with it are governed by English law.

THE SCHEDULE
Rights and obligations to be novated:
EXISTING AB LENDER
Existing AB Commitment: US $[l]
Assignee: New AB Lender

EXISTING AF LENDER
Existing AF Commitment: US $[l]
Assignee: New AF Lender

, as the Existing AB Lender

By:
Name:
Title:
LIBERTY GLOBAL SERVICES B.V. (formerly known as UPC Broadband Operations B.V.), as the New AB Lender

By:
Name:
Title:

LIBERTY GLOBAL SERVICES B.V. (formerly known as UPC Broadband Operations B.V.), as the Existing AF Lender

By:
Name:
Title:

, as the New AF Lender

By:
Name:
Title:

UPC BROADBAND HOLDING B.V., as Obligors agent

By:
Name:
Title:

THE BANK OF NOVA SCOTIA, as Facility Agent

By:
Name:
Title:
Date:
The Facility Agent confirms that the Effective Date is the date on which it countersigns this Novation Certificate.

SCHEDULE 4
NOVATION CERTIFICATE (CASH)
To:    The Bank of Nova Scotia as Facility Agent and UPC Financing as Borrower
From:    [THE EXISTING LENDER] and [THE NEW LENDER]
Date: [          ]
UPC Broadband Holding B.V. - €1,072,000,000 Term Credit Agreement dated 16 January, 2004 (the Credit Agreement)
We refer to:
		
	(e)
	Clause 26.3 (Procedure for novations) of the Credit Agreement;

		
	(f)
	Clause 9.3 (Transfers by the Lenders) of the Security Deed; and

		
	(g)
	the Accession Agreement dated [l] 2012, pursuant to which a US $500,000,000 term loan facility is being made available to the Borrower as an Additional Facility (Additional Facility AF) under the Credit Agreement (the Additional Facility AF Accession Agreement).

Terms defined in the Credit Agreement or, if not defined in the Credit Agreement, the Additional Facility AF Accession Agreement, have the same meaning in this Novation Certificate.
		
	1.
	We [     ] (the Existing Lender) and [     ] (the New Lender) agree to the Existing Lender and the New Lender novating all the Existing Lender's rights and obligations referred to in the Schedule on and from the Effective Date in accordance with Clause 26.3 (Procedure for novations) of the Credit Agreement and clause 9.3 (Transfers by the Lenders) of the Security Deed.

		
	2.
	The New Lender confirms that it is bound by the terms of the Additional Facility AF Accession Agreement as if it were an original party thereto as an Additional Facility AF Lender and shall acquire the same rights grant the same consents and assume the same obligations towards the other parties to this Agreement as would have been acquired, granted and assumed had the New Lender been an original party to the Additional Facility AF Accession Agreement as an Additional Facility AF Lender.

		
	3.
	For the purposes of this Novation Certificate, “Effective Date” means the date on which the Facility Agent countersigns this certificate.

		
	4.
	The Facility Office and address for notices of the New Lender for the purposes of Clause 32.2 (Addresses for notices) are set out in the Schedule.

		
	5.
	This Novation Certificate may be executed in any number of counterparts, and by each party on separate counterparts.  Each counterpart is an original, but all counterparts shall together constitute one and the same instrument.  Delivery of an executed counterpart signature page of this Novation 

Certificate by e-mail (PDF) or telecopy shall be as effective as delivery of a manually executed counterpart of this Novation Certificate.
		
	6.
	This Novation Certificate is a Finance Document and any non-contractual obligations arising out of or in connection with it are governed by English law.

THE SCHEDULE
Rights and obligations to be novated
EXISTING LENDER
Existing Lender's Commitment under Additional Facility AF: US $[l]
Assignee: New Lender

	
			
	[New Lender]
	 
	 

	[Facility Office
	Address for notices for administrative purposes
	 

	 
	Address for notices for credit purposes]
	 

[The Existing Lender], as the Existing Lender

By:
Name:
Title:

[The New Lender], as the New Lender

By:
Name:
Title:

UPC BROADBAND HOLDING B.V., as Obligors agent

By:
Name:
Title:

THE BANK OF NOVA SCOTIA, as Facility Agent

By:
Name:
Title:
Date:
The Facility Agent confirms that the Effective Date is the date on which it countersigns this Novation Certificate.

SIGNATORIES TO ADDITIONAL FACILITY AF ACCESSION AGREEMENT

THE BANK OF NOVA SCOTIA as Facility Agent
By:     Authorized Signatory

THE BANK OF NOVA SCOTIA as Security Agent
By:    Authorized Signatory

(Signature Page to AF Accession Agreement)

UPC BROADBAND HOLDING B.V.
By:     Authorized Signatory
By:    Authorized Signatory

(Signature Page to AF Accession Agreement)
	
			
	 

	 
	 
	 

UPC FINANCING PARTNERSHIP 
By:    Authorized Signatory
By:    Authorized Signatory

(Signature Page to AF Accession Agreement)
	
			
	 

	 
	 
	 

ADDITIONAL FACILITY AF LENDER

LIBERTY GLOBAL SERVICES B.V. (formerly known as UPC Broadband Operations B.V.)
By:   Authorized Signatory

(Signature Page to AF Accession Agreement)11 2012 Amendments to 2012 Incentive Plan

FINAL 
Board Approved 12/1/11
(Technical Amendments
Adopted 3/19/12; Additional Amendments Adopted 5/18/12)
Updated 11/15/12
                                        

Federal Home Loan Bank of Indianapolis
Incentive Plan

(Effective as of January 1, 2012)
(As Amended March 19, 2012)
(As Further Amended May 18, 2012)
(As Updated November 15, 2012 to Reflect 2013 Performance Goals)

ADOPTION OF
FEDERAL HOME LOAN BANK OF INDIANAPOLIS
INCENTIVE PLAN
Pursuant to resolutions adopted by the Board of Directors of the Federal Home Loan Bank of Indianapolis (the “Bank”), the undersigned officers of the Bank hereby execute the Federal Home Loan Bank of Indianapolis Incentive Plan, effective as of January 1, 2012, on behalf of the Bank, in the form attached hereto.
Dated this 18th day of May, 2012.
FEDERAL HOME LOAN BANK OF INDIANAPOLIS
By: /s/PAUL CLABUESCH
Paul Clabuesch, Chairman
By: /s/JEFFREY A. POXON
Jeffrey A. Poxon, Vice Chairman
ATTEST:
By: /s/KANIA D.WARBINGTON
Kania D. Warbington, Corporate Secretary

FEDERAL HOME LOAN BANK OF INDIANAPOLIS
INCENTIVE PLAN
TABLE OF CONTENTS
    
	
				
	 
	 
	PAGE

	Article I
	INTRODUCTION
	1
	

	 
	 
	 

	Section 1.1
	Purpose
	1
	

	Section 1.2
	Effective Date
	1
	

	Section 1.3
	Administration
	1
	

	Section 1.4
	Supplements
	1
	

	Section 1.5
	Definitions
	1
	

	 
	 
	 

	Article II
	ELIGIBILITY AND PARTICIPATION
	2
	

	 
	 
	 

	Section 2.1
	Eligibility
	2
	

	Section 2.2
	Participation
	2
	

	 
	 
	 

	Article III
	AWARDS AND EXTRAORDINARY OCCURENCE ADDITIONS/REDUCTIONS
	3
	

	 
	 
	 

	Section 3.1
	Awards
	3
	

	Section 3.2
	Performance Goals
	4
	

	Section 3.3
	Earning and Vesting of Awards for Level I Participants
	5
	

	Section 3.4
	Earning and Vesting of Awards for Level II Participants
	6
	

	Section 3.5
	Special Gap Year Awards for Level I Participants
	6
	

	Section 3.6
	Effect of Termination of Service and Amendment of Prior Long-Term Plans
	7
	

	Section 3.7
	Effect of Reorganization
	10
	

	Section 3.8
	Payment of Awards
	11
	

	Section 3.9
	Reduction or Forfeiture of Awards
	11
	

	 
	 
	 

	Article IV
	ADMINISTRATION
	12
	

	 
	 
	 

	Section 4.1
	Appointment of the Committee
	12
	

	Section 4.2
	Powers and Responsibilities of the Committee
	12
	

	Section 4.3
	Income and Employment Tax Withholding
	13
	

	Section 4.4
	Plan Expenses
	13
	

	 
	 
	 

	Article V
	BENEFIT CLAIMS
	13
	

	 
	 
	 

	Article VI
	AMENDMENT AND TERMINATION OF THE PLAN
	13
	

	 
	 
	 

	Section 6.1
	Amendment of the Plan
	13
	

	Section 6.2
	Termination of the Plan
	14
	

	
				
	 
	 
	PAGE

	Article VII
	MISCELLANEOUS
	14
	

	 
	 
	 

	Section 7.1
	Governing Law
	14
	

	Section 7.2
	Headings and Gender
	14
	

	Section 7.3
	Spendthrift Clause
	14
	

	Section 7.4
	Counterparts
	14
	

	Section 7.5
	No Enlargement of Employment Rights
	14
	

	Section 7.6
	Limitations on Liability
	14
	

	Section 7.7
	Incapacity of Participant
	14
	

	Section 7.8
	Evidence
	15
	

	Section 7.9
	Action by Bank
	15
	

	Section 7.10
	Severability
	15
	

	Section 7.11
	Information to be Furnished by a Participant
	15
	

	Section 7.12
	Attorneys' Fees
	15
	

	Section 7.13
	Binding on Successors
	15
	

	Section 7.14
	Retention of Former Plans
	15
	

	 
	 
	 

	APPENDIX I - 2013 PERFORMANCE PERIOD AWARDS FOR LEVEL II PARTICIPANTS
	17
	

	APPENDIX II - 2013 PERFORMANCE PERIOD AWARDS FOR LEVEL I PARTICIPANTS
	20
	

	APPENDIX III - ANNUAL AWARD TARGETS FOR 2010 AND 2011 LONG TERM INCENTIVE PLANS
	25
	

	APPENDIX IV - AWARDS ADDRESSING 2015 GAP YEAR FOR LEVEL I PARTICIPANTS
	28
	

	APPENDIX V - FORM OF NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT
	29
	

ARTICLE I
INTRODUCTION
Section 1.1    Purpose. The purpose of the Federal Home Loan Bank of Indianapolis Incentive Plan (the “Plan”) is to attract, retain and motivate employees of the Federal Home Loan Bank of Indianapolis (the “Bank”) and to focus their efforts on continued improvement in the profitability of the Bank while maintaining the Bank's safety and soundness.  The Plan is a cash-based incentive plan that provides award opportunities based on achievement of performance goals.

Section 1.2    Effective Date.  The “Effective Date” of the Plan is January 1, 2012.

Section 1.3    Administration.  The Plan will be administered by an administrative committee (the “Committee”) appointed by the Bank's Board of Directors (the “Board”), which initially will be the Human Resources Committee of the Board.  Notwithstanding the foregoing, the term Committee shall also refer to the Executive Governance Committee of the Board who will administer the Plan with respect to the Bank's Chief Executive Officer.  The Committee, from time to time, may adopt any rules and procedures it deems necessary or desirable for the proper and efficient administration of the Plan that are consistent with the terms of the Plan.  Any notice or document required to be given or filed with the Committee will be properly given or filed if delivered to or mailed by registered mail, postage paid, to the General Counsel, Federal Home Loan Bank of Indianapolis, 8250 Woodfield Crossing Blvd., Suite 400, Indianapolis, Indiana 46240.

Section 1.4    Supplements.  The provisions of the Plan may be modified by supplements to the Plan with Board approval.  The terms and provisions of each supplement are a part of the Plan and supersede any other provisions of the Plan to the extent necessary to update or eliminate any inconsistencies between the supplement and any other Plan provisions.  Any substantive supplement to the Plan shall be submitted to the FHFA for review prior to implementation.

Section 1.5    Definitions.  The following terms are defined in the Plan in the following Sections:	
		
	Term
	Plan Sections

	2009 LTIP
	3.6(d)(v)

	2010 LTIP
	3.6(d)(v)

	2011 LTIP
	3.6(d)(v)

	Annual Award
	3.3(a), 3.4(a)

	Award
	3.1

	Bank
	1.1

	Board
	1.3

	Cause
	3.6(d)(i)

	Committee
	1.3

	Compensation
	3.1

	Deferral Performance Period
	3.1(a)

	Deferred Award
	3.3(b)

	Disability
	3.6(d)(ii)

	Discretionary Award
	3.1(d)

	Effective Date
	1.2

	 
	 

	 
	 

1

	
		
	Extraordinary Occurrences
	3.1(e)

	FHFA
	3.6(d)(i)

	Final Award
	3.1(e)

	Fully Meets Expectations
	3.3(a)(ii)

	Gap Year Award
	3.5(a)

	Gap Year Performance Period
	3.5(b)

	Good Reason
	3.6(d)(iii)

	Level I Participant
	3.1(c)

	Level II Participant
	3.1(c)

	Maximum
	3.2(b)(iii)

	Non-Solicitation Agreement
	2.1

	Participant
	2.1

	Performance Goals
	3.2

	Performance Period
	3.1(a)

	Plan
	1.1

	Position
	3.6(d)(iii)(A)

	Reduction in Force
	3.6(d)(iv)

	Reorganization
	3.7(b)

	Retirement
	3.6(d)(v)

	Satisfactory
	3.3(a)(ii)

	Termination of Service
	3.6(d)(vi)

	Target
	3.2(b)(ii)

	Threshold
	3.2(b)(i)

ARTICLE II

ELIGIBILITY AND PARTICIPATION

Section 2.1    Eligibility.  Any employee of the Bank, hired before October 1st of the calendar year, will become a “Participant” in the Plan for that calendar year, provided the employee is not classified as a “temporary,” an “intern,” “contract” or “temporary agency” employee, and does not participate in the Federal Home Loan Bank of Indianapolis Internal Audit Incentive Plan.  Level I Participants, as defined in subsection 3.1(c), must have an executed agreement on file with the Bank containing non-solicitation and non-disclosure provisions in a form similar to the form provided in Appendix V to the Plan (“Non-Solicitation Agreement”).

Section 2.2    Participation.  A designated employee or otherwise eligible employee will become a Participant as of the later of the Effective Date, the employee's date of hire, or the date on or after the Effective Date the employee satisfies the automatic eligibility provisions described in Section 2.1.  Any Participant may be removed as an active Participant by the Board effective as of any date.

2

ARTICLE III

AWARDS AND EXTRAORDINARY OCCURRENCE ADDITIONA/REDUCTIONS

Section 3.1    Awards.  At the beginning of each Performance Period, the Board will make an “Award” to eligible Participants.  As described in this Article, Awards may be Annual Awards (as defined in subsection 3.3(a)), Deferred Awards (as defined in subsection 3.3(b)), Gap Year Awards (as defined in subsection 3.5(a)) or Discretionary Awards (as defined in subsection 3.1(d)).  Each Award will be equal to a percentage of the Participant's annual Compensation, as described in the applicable Appendices for Level I Participants and Level II Participants.  “Compensation” means the Participant's annual earned base salary or wages for hours worked, including overtime and hours paid under the Bank's paid-time-off policies, as applicable, but in any case excluding any bonus, incentive compensation, or long-term disability insurance payments paid for the current or a prior year.  In the event a Participant receives a raise during a calendar year, the Participant's Compensation for the year will reflect the actual wages paid to the Participant for the year.
		
	(a)
	Performance Periods.  A “Performance Period” is the one-calendar year period over which an Annual Award can be earned and vested pursuant to subsections 3.3(a) and 3.4(a).  A “Deferral Performance Period” is the three-calendar year period over which a Deferred Award can be earned and vested pursuant to subsection 3.3(b).  A Deferral Performance Period begins on the January 1st immediately following the applicable Performance Period.

		
	(b)
	Award Notification.  Participants will be notified of an Annual Award, a Deferred Award or Discretionary Award by the Bank by posting the Performance Goals and other necessary terms and conditions applicable to the Annual Award, Deferred Award or Discretionary Award on SharePoint on the Bank's intranet.

		
	(c)
	Award Levels.  Participants will receive varying Awards for each Performance Period based on their position with the Bank.  A “Level I Participant” is the Bank's President and Chief Executive Officer, Executive Vice President or Senior Vice President of the Bank or any other individual designated as a Level I Participant by the Board.  A “Level II Participant” is any participating employee who is not a Level I Participant.

		
	(d)
	Discretionary Award.  The President may recommend to the Board that an additional discretionary Award (the “Discretionary Award”) be made to a Level II Participant to address external market considerations, recruiting needs, special projects and extraordinary individual or team efforts.  The aggregate pool of funds available for Discretionary Awards to Level II Participants will not exceed 20 percent of the annual aggregate Awards for still eligible Level I Participants.

		
	(e)
	Final Award and Extraordinary Occurrences.  The “Final Award” is the amount of an earned and vested Annual Award, Deferred Award, Gap Year Award or Discretionary Award, as adjusted based upon the level at which the Performance Goals have been achieved, that is ultimately paid to a Participant under the Plan.  The amount of a Final Award may be increased or decreased at the Board's discretion to account for performance that is not captured in the Performance Goals.  The Board, in its discretion, may also consider Extraordinary Occurrences when assessing performance results and determining Final Awards.  “Extraordinary Occurrences” mean those events that, in the opinion and discretion of the Board, are outside the significant influence of the Participant or the Bank 

3

and are likely to have a significant unanticipated effect, whether positive or negative, on the Bank's operating and/or financial results.  Examples of Extraordinary Occurrences include, but are not limited to, change in law, regulation, or regulatory policy, or systemic macroeconomic events outside of management's control.

		
	(f)
	Transition Goals for Replaced Long-Term Incentive Programs.  Upon adoption of this Plan, the “Performance Goals” required by the 2010 LTIP and 2011 LTIP for calendar years 2012 and 2013 shall be as set forth in Appendix III.

Section 3.2    Performance Goals.  “Performance Goals” are the performance factors established by the Board for each Performance Period, Deferral Performance Period and Gap Year Performance Period, as set forth in the applicable Appendices to the Plan, which are taken into consideration in determining the value of an Annual Award, Deferred Award or Gap Year Award.  The Board may, for any reason or for an Extraordinary Occurrence, adjust the Performance Goals for a Performance Period, Deferral Performance Period or Gap Year Performance Period to ensure the purposes of the Plan are served.  Any such adjustment to Performance Goals shall be submitted to the FHFA for review prior to implementation.

		
	(a)
	Establishment of Performance Goals.  Performance Goals for Performance Periods, Deferral Performance Periods or the Gap Year Performance Period commencing on and after January 1, 2012, will be communicated to Participants via SharePoint on the Bank's intranet after they have been established by the Board.

		
	(b)
	Achievement Level.  Three achievement levels will be defined for each Performance Goal in determining how much of an Award is earned.

		
	i.
	Threshold.  The “Threshold” achievement level is the minimum achievement level accepted for a Performance Goal.

		
	ii.
	Target.  The “Target” achievement level is the planned achievement level for a Performance Goal.

		
	iii.
	Maximum.  The “Maximum” achievement level is achievement that substantially exceeds the Target achievement level.

		
	(c)
	Interpolation.  Achievement levels that discreetly fall in between Threshold-, Target-, and Maximum, will be interpolated, unless otherwise described in a Performance Goal. 

		
	(d)
	Considerations in Establishing Performance Goals.  In determining appropriate Performance Goals and the relative weight accorded each Performance Goal, the Committee must:

4

		
	i.
	Balance risk and financial results in a manner that does not encourage Participants to expose the Bank to imprudent risks;

		
	ii.
	Make such determination in a manner designed to ensure that Participants' overall compensation is balanced and not excessive in amount and that the Annual Awards, Deferred Awards and Gap Year Awards are consistent with the Bank's policies and procedures regarding such compensation arrangements; and

		
	iii.
	Monitor the success of the Performance Goals and weighting established in prior years, alone and in combination with other incentive compensation awarded to the same Participants, and make appropriate adjustments in future calendar years as needed so that payments appropriately incentivize Participants and appropriately reflect risk.

Section 3.3    Earning and Vesting of Awards for Level I Participants.

		
	(a)
	Earning and Vesting of Annual Awards.  Fifty percent of an Award to a Level I Participant will become earned and vested on the last day of the Performance Period, provided the following requirements are met (an “Annual Award”):

		
	i.
	The applicable Performance Goals for the Performance Period are satisfied;

		
	ii.
	The Participant received a performance rating for the Performance Period of at least “Fully Meets Expectations” or “Satisfactory;” and

		
	iii.
	The Participant is actively employed on the last day of the Performance Period, unless otherwise provided in subsection 3.6(a) or 3.6(c) or Section 3.7.

		
	(b)
	Earning and Vesting of Deferred Awards.  The remaining 50 percent of an Award to a Level I Participant will become earned and vested on the last day of the Deferral Performance Period, provided the following requirements are met (a “Deferred Award”):

		
	i.
	The applicable Performance Goals for the Deferral Performance Period are satisfied;

		
	ii.
	The Participant received an average performance rating for the Deferral Performance Period of at least Fully Meets Expectations or Satisfactory; and

		
	iii.
	The Participant is actively employed on the last day of the Deferral Performance Period, unless otherwise provided in subsection 3.6(a) or 3.6(c) or Section 3.7.

5

		
	(c)
	Calculation of Awards.  The value of Awards to Level I Participants will be calculated in accordance with the applicable Appendix to the Plan.

Section 3.4    Earning and Vesting of Awards for Level II Participants.

		
	(a)
	Earning and Vesting of Awards.  An Award to a Level II Participant will become earned and vested on the last day of the Performance Period provided the following requirements are met (also an “Annual Award”):

		
	i.
	The applicable Performance Goals for the Performance Period are satisfied;

		
	ii.
	The Participant received a performance rating for the Performance Period of at least Fully Meets Expectations or Satisfactory; and

		
	iii.
	The Participant is actively employed on the last day of the Performance Period, unless otherwise provided in subsection 3.6(a) or 3.6(c).

		
	(b)
	Calculation of Awards.  The value of Awards to Level II Participants will be calculated in accordance with the applicable Appendix to the Plan.

Section 3.5    Special Gap Year Awards for Level I Participants.

		
	(a)
	Background.  The Board has determined it is appropriate to make a special Award to Level I Participants solely for calendar year 2012 (a “Gap Year Award”) to address a gap in payment of incentive compensation during calendar year 2015 which arises as a result of the planned discontinuation of the 2011 LTIP and the implementation of this Plan. 

		
	(b)
	Earning and Vesting of Awards.  Notwithstanding Sections 3.3 and 3.4, a Gap Year Award will become earned and vested over a three-year period beginning on January 1, 2012 and ending on December 31, 2014 (the “Gap Year Performance Period”) to the extent:

		
	i.
	The Performance Goals for the Gap Year Performance Period, as set forth in the applicable Appendix to the Plan, are satisfied;

		
	ii.
	The Level I Participant received a performance rating for the Gap Year Performance Period of at least Fully Meets Expectations or Satisfactory; and

		
	iii.
	The Level I Participant is actively employed on the last day of the Gap Year Performance Period, unless otherwise provided in subsection 3.6(a) or 3.6(c) or Section 3.7.

		
	(c)
	Calculation of Awards.  The value of Gap Year Awards will be calculated in accordance with the applicable Appendix to the Plan.

6

Section 3.6    Effect of Termination of Service and Amendment of Prior Long-Term Plans.

		
	(a)
	In General.  If a Level I Participant incurs a Termination of Service for any reason other than a reason set forth in subsection 3.6(b), 3.6(c), or Section 3.7, the Level I Participant's Award will be forfeited, effective as of the date of such Termination of Service. 

If a Level II Participant incurs a Termination of Service for any reason other than a reason set forth in subsection 3.6(b) or 3.6(c), the Level II Participant's Award will be forfeited effective as of the date of such Termination of Service.  

		
	(b)
	Termination Due to Death or Disability.  

		
	i.
	Notwithstanding the provisions of Sections 3.3 and 3.5 and subsection 3.6(a), if a Level I Participant incurs a Termination of Service due to death or Disability during a Deferral Performance Period or the Gap Year Performance Period, then the Participant's Deferred Awards or Gap Year Award for all complete years of the three-year Deferral Performance Period or Gap Year Performance Period will be treated as earned and vested based on the assumption the Bank would have achieved the applicable Performance Goals at the Target achievement level for the Deferral Performance Period and/or Gap Year Performance Period.

		
	ii.
	Notwithstanding the provisions of Sections 3.3 and 3.5 and subsection 3.6(a), if a Level I Participant incurs a Termination of Service during a Performance Period due to death or Disability, any Annual Award which has not been earned and vested as well as the Deferred Award for the year of the Participant's Termination of Service due to death or Disability, will be treated as earned and vested for the portion of the Performance Period during which the Participant was employed based on the assumption the Bank would have achieved the Performance Goals at the Target achievement level for the Performance Period.

		
	iii.
	Notwithstanding the provisions of Section 3.4 and subsection 3.6(a), if a Level II Participant incurs a Termination of Service during a Performance Period due to death or Disability, an Annual Award will be treated as earned and vested for the portion of the Performance Period during which the Participant was employed as of the date of such Termination of Service based on the assumption the Bank would have achieved the Performance Goals at the Target achievement level for the Performance Period.

		
	(c)
	Termination Due to Other Events.

		
	i.
	Notwithstanding the provisions of Sections 3.3 and 3.5 and subsection 3.6(a), if a Level I Participant incurs a Termination of Service during a Performance Period, Deferral Performance Period or Gap Year Performance Period due to:

7

		
	(A)
	Retirement;

		
	(B)
	a termination by a Level I Participant for Good Reason; or 

		
	(C)
	a termination by the Bank without Cause due to a Reduction in Force, 

an Annual Award, Deferred Award or Gap Year Award, as the case may be, will be treated as earned and vested for the portion of the Performance Period, Deferral Performance Period and/or Gap Year Performance Period during which the Participant was employed to the extent the Performance Goals for the Performance Period, Deferral Performance Period and/or Gap Year Performance Period are satisfied.
		
	ii.
	Notwithstanding the provisions of Section 3.4 and subsection 3.6(a), if a Level II Participant incurs a Termination of Service during a Performance Period due to:

		
	(A)
	Retirement; or

		
	(B)
	a termination by the Bank without Cause due to a Reduction in Force, 

an Annual Award will be treated as earned and vested for the portion of the Performance Period during which the Level II Participant was employed to the extent the Performance Goals for the Performance Period are satisfied.
		
	(d)
	Definitions.

		
	i.
	“Cause” means (A) continued failure of a Participant to perform his or her duties with the Bank (other than any such failure resulting from Disability), after a written demand for performance is delivered to the Participant, which specifically identifies the manner in which the Participant has not performed his or her duties, (B) personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure or omission to perform stated duties, or willful violation of any law, rule or regulation (other than routine traffic violations or similar offenses), or (C) removal of the Participant for cause by the Federal Housing Finance Agency (“FHFA”) or at the direction of the FHFA pursuant to 12 U.S.C. 1422b(a)(2), or by any successor agency to the FHFA pursuant to a similar statute.

		
	ii.
	“Disability” means, as a result of the Participant's incapacity due to physical or mental illness, the Participant has been absent from his or her duties with the Bank for an aggregate of 12 out of 15 consecutive months and, within 30 days after a written notice of termination is thereafter given by the Bank to the Participant, the Participant does not return to the full-time performance of the Participant's duties.

8

		
	iii.
	“Good Reason” means a Termination of Service by a Level I Participant under any of the following circumstances:

		
	(A)
	a material change in the Participant's status, position, job title or principal duties and responsibilities as a key employee of the Bank which does not represent a promotion from the Participant's status and position as in effect as of the date hereof (“Position”);

		
	(B)
	the assignment to the Participant of any duties or responsibilities (or removal of any duties or responsibilities), which assignment or removal is materially inconsistent with such Position;

		
	(C)
	any removal of the Participant from such Position (including, without limitation, all demotions and harassing assignments), except in connection with the termination of the Participant's employment for Cause or Disability, or as a result of the Participant's death;

		
	(D)
	any material breach by the Bank of any provisions of this Plan or any other agreement with the Participant; or

		
	(E)
	any failure by the Bank or its successors and assigns to obtain the assumption of this Plan by any successor or assign of the Bank.

		
	iv.
	“Reduction in Force” means an involuntary Termination of Service of a Participant by the Bank in connection with a financial decision by the Board to reduce the number of Bank employees, not due to the Participant's performance, and not due to a Reorganization.

		
	v.
	“Retirement” means the Participant's planned and voluntary termination of employment after the Participant has delivered timely advance written notice of intent to retire to the Bank and has either: (A) attained age 60 with five “Years of Service,” or (B) attained the “Rule of 85,” which means the Participant has attained a combined age and Years of Service that mathematically is equal to or exceeds the number 85.  A “Year of Service” will be calculated in the same manner as under the Financial Institutions Thrift Plan.  Advance written notice will be deemed timely given if it is given at least four weeks in advance, as to Vice Presidents, First Vice Presidents, Senior Vice Presidents, Executive Vice Presidents, and the Chief Executive Officer, and at least two weeks in advance, as to all other employees.

Effective as of the effective date of the Federal Home Loan Bank of Indianapolis 2009 Incentive Plan (the “2009 LTIP”), the Federal Home Loan Bank of Indianapolis 2010 Incentive Plan (the “2010 LTIP”), and the Federal Home Loan Bank of Indianapolis Long Term Incentive Plan (the “2011 LTIP”), this subsection hereby amends the definition of “Retirement” under the 2009 LTIP, 2010 LTIP and the 2011 LTIP to conform to the definition of Retirement as set forth above, with respect to determining if an employee retired beginning on and after January 1, 2012.

9

		
	vi.
	“Termination of Service” means the occurrence of any act or event or any failure to act, that actually or effectively causes or results in a Participant ceasing, for whatever reason, to be an employee of the Bank, including, but not limited to, death, Disability, Retirement, termination of the Participant's employment by the Bank (whether for Cause or otherwise), termination by the Participant of his or her employment with the Bank for Good Reason and voluntary resignation or termination by the Participant of his or her employment.

Section 3.7    Effect of Reorganization. The following provision applies to Level I Participants only. 

		
	(a)
	Notwithstanding the provisions of Sections 3.3 and 3.6, if a Reorganization of the Bank occurs, then any portion of an Annual Award or Deferred Award which has not otherwise become earned and vested as of the date of the Reorganization will be treated as 100 percent earned and vested effective as of the date of the Reorganization based on the assumption the Bank would have achieved the Performance Goals at the Target achievement level for the Performance Period and/or the Deferral Performance Period.

		
	(b)
	“Reorganization” of the Bank will 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, or another bank or other entity is merged or consolidated into the Bank;

		
	ii.
	The Bank sells or transfers all, or substantially all of its business and/or assets to another bank or other entity;

		
	iii.
	More than 50 percent of the total market value or total voting power of all ownership interests in the Bank is acquired, within any 12-month period, by one person or entity or by more than one person or entity acting as a group; or

		
	iv.
	The liquidation or dissolution of the Bank.

The term “Reorganization” shall not include any Reorganization that is mandated by federal statute, rule, regulation, or directive, including 12 U.S.C. § 1421, et seq., as amended, and 12 U.S.C. § 4501 et seq., as amended, and which the Director of the FHFA (or successor agency) has determined should not be a basis for accelerating vesting under this Plan, by reason of the capital condition of the Bank or because of unsafe or unsound acts, practices, or condition ascertained in the course of the Agency's supervision of the Bank or because any of the conditions identified in 12 U.S.C. § 4617(a)(3) are met with respect to the Bank (which conditions do not result solely from the mandated reorganization itself, or from action that the Agency has required the Bank to take under 12 U.S.C. § 1431(d)).

10

Section 3.8    Payment of Awards.

		
	(a)
	Payments Related to Termination of Service.  The following provisions apply to Final Awards payable as a result of a Termination of Service.

		
	i.
	In the event of a Termination of Service due to death or Disability, 100 percent of a Final Award will be paid in a single sum within 75 days of the date of Termination of Service.

		
	ii.
	In the event of a Termination of Service due to Retirement, a termination by a Level I Participant for Good Reason or a termination by the Bank without Cause due to a Reduction in Force, payment of a Final Award will be made in a single sum within 75 days following the end of the Performance Period, Deferral Performance Period or Gap Year Performance Period, as applicable.  Notwithstanding the foregoing, in the event of a Reduction in Force, a Participant must execute the severance agreement offered by the Bank in order to be eligible to receive payment.

		
	(b)
	Payments Not Related to a Termination of Service.  Final Awards which become vested for reasons other than a Termination of Service will be paid in a single sum within 75 days following the end of the Performance Period, Deferral Performance Period or Gap Year Performance Period, as applicable.

		
	(c)
	Notwithstanding the foregoing provisions of this Section, Final Awards will be paid upon approval by the Board and after review of the calculations by the Bank's external auditor.  However, in the event of a Reorganization, payment of a Final Award will be made in a single sum on the date on which the Reorganization occurs.

Section 3.9    Reduction or Forfeiture of Awards.

		
	(a)
	If during the Deferral Performance Period actual losses or other measures or aspects of performance related to the Performance Period or Deferral Performance Period are realized which would have caused a reduction in amount of the Final Award calculated for the Performance Period or Deferral Performance Period, then the remaining amount of the Final Award to be paid at the end of the Deferral Performance Period will be reduced to reflect this additional information.

		
	(b)
	Notwithstanding any other provision of the Plan, if a Participant violates a Non-Solicitation Agreement, all of his unpaid vested and unvested Awards will be forfeited effective as of the date the Board determines such violation has occurred and gives written notice to the Participant of such determination.  Any future payments for a vested Award will cease and the Bank will have no further obligation to make such payments.

11

		
	(c)
	Notwithstanding any other provision of the Plan, if during the most recent examination of the Bank by the FHFA, the FHFA identified an unsafe or unsound practice or condition that is material to the financial operation of the Bank within the Participant's area(s) of responsibility and such unsafe or unsound practice or condition is not subsequently remediated to the satisfaction of the Board as determined by the Board after reviewing the findings or input from the FHFA, then all (or a portion) of a Participant's vested and unvested Awards will be forfeited as determined by the Board and directed to the participant in writing.  Any future payments for a vested Award will, if directed by the Board, cease and the Bank will have no further obligation to make such payments.

		
	(d)
	By resolution, the Board may reduce or eliminate an Award that is otherwise earned under this Plan but not yet paid, if the Board finds that a serious, material safety-soundness problem, or a serious, material risk-management deficiency exists at the Bank, or if: (i) operational errors or omissions result in material revisions to: (A) the financial results, (B) information submitted to the FHFA, or (C) data used to determine incentive payouts; (ii) submission of material information to the SEC, Office of Finance, and/or FHFA is significantly past due, or (iii) the Bank fails to make sufficient progress, as determined by the Board, in the timely remediation of significant examination, monitoring and other supervisory findings.

ARTICLE IV

ADMINISTRATION

Section 4.1    Appointment of the Committee.  The Committee, or a duly authorized officer or officers of the Bank empowered by the Committee to act on its behalf under sub-section 4.2(d), will be responsible for administering the Plan, and the Committee will be charged with the full power and the responsibility for administering the Plan in all its details; provided that the power to determine eligibility pursuant to Article II is reserved to the Board.

Section 4.2    Powers and Responsibilities of the Committee.  The Committee will have all powers necessary to administer the Plan, including the power to construe and interpret the Plan document; to decide all questions relating to an individual's eligibility to participate in the Plan; to determine the amount, manner and timing of any distribution of benefits under the Plan; to resolve any claim for benefits in accordance with Article V, and to appoint or employ advisors, including legal counsel, to render advice with respect to any of the Committee's responsibilities under the Plan.  Any construction, interpretation, or application of the Plan by the Committee will be final, conclusive and binding.

12

		
	(a)
	Records and Reports.  The Committee will be responsible for maintaining sufficient records to determine each Participant's eligibility to participate in the Plan.

		
	(b)
	Rules and Decisions.  The Committee may adopt such rules as it deems necessary, desirable, or appropriate in the administration of the Plan.  All rules and decisions of the Committee will be applied uniformly and consistently to all Participants in similar circumstances.  When making a determination or calculation, the Committee will be entitled to rely upon information furnished by a Participant, the Bank or the legal counsel of the Bank.

		
	(c)
	Application for Benefits.  The Committee may require a Participant to complete and file with it an application for a benefit, and to furnish all pertinent information requested by it.  The Committee may rely upon all such information so furnished to it, including the Participant's current mailing address.

		
	(d)
	Delegation.  The Committee may authorize one or more officers or employees of the Bank to perform administrative responsibilities on its behalf under the Plan.  Any such duly authorized officer will have all powers necessary to carry out the administrative duties delegated to such officer by the Committee.

Section 4.3    Income and Employment Tax Withholding.  The Bank will withhold from payments to Participants of their Awards, to the extent required by law, all applicable federal, state, city and local taxes.

Section 4.4    Plan Expenses.  The expenses incurred for the administration and maintenance of the Plan will be paid by the Bank.

ARTICLE V

BENEFIT CLAIMS

While a Participant need not file a claim to receive his or her benefit under the Plan, if he or she wishes to do so, a claim must be made in writing and filed with the Committee.  If a claim is denied, the Committee will furnish the claimant with written notice of its decision.  A claimant may request a full and fair review of the denial of a claim for benefits by filing a written request with the Committee.
ARTICLE VI

AMENDMENT AND TERMINATION OF THE PLAN

Section 6.1    Amendment of the Plan.  The Bank, acting through the Board, may amend the Plan at any time in its sole discretion.  Notwithstanding the foregoing, the Bank may not amend the Plan to reduce a Participant's Award as determined on the day preceding the effective date of the amendment or to otherwise retroactively impair or adversely affect the rights of a Participant.  Any substantive amendment to the Plan shall be submitted to the FHFA for review prior to implementation.

13

Section 6.2    Termination of the Plan.  The Bank, acting through the Board, may terminate the Plan at any time in its sole discretion.  Absent an amendment to the contrary, Plan benefits that were earned and vested prior to the termination will be paid at the times and in the manner provided for by the Plan at the time of the termination.

ARTICLE VII

MISCELLANEOUS

Section 7.1    Governing Law.   Except to the extent superseded by laws of the United States, the laws of Indiana will be controlling in all matters relating to the Plan without regard to the choice of law principles therein.  The Plan and all Awards are intended to comply, and will be construed by the Bank in a manner in which they are exempt from or comply with the applicable provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).  To the extent there is any conflict between a provision of the Plan or an Award and a provision of Code Section 409A, the applicable provision of Code Section 409A will control.

Section 7.2    Headings and Gender.   The headings and subheadings in the Plan have been inserted for convenience of reference only and will not affect the construction of the Plan provisions.  In any necessary construction, the masculine will include the feminine and the singular the plural, and vice versa.

Section 7.3    Spendthrift Clause.   No benefit or interest available under the Plan will be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or attachment by creditors of a Participant, either voluntarily or involuntarily.

Section 7.4    Counterparts.   This Plan may be executed in any number of counterparts, each one constituting but one and the same instrument, and may be sufficiently evidenced by any one counterpart.

Section 7.5    No Enlargement of Employment Rights.   Nothing contained in the Plan may be construed as a contract of employment between the Bank and any person, nor may the Plan be deemed to give any person the right to be retained in the employ of the Bank or limit the right of the Bank to employ or discharge any person with or without cause.

Section 7.6    Limitations on Liability.   The individual members of the Board will, in accordance with the Bank's by-laws, be indemnified and held harmless by the Bank with respect to any alleged breach of responsibilities performed or to be performed hereunder.  In addition, notwithstanding any other provision of the Plan, neither the Bank nor any individual acting as an employee or agent of the Bank will be liable to a Participant for any claim, loss, liability or expense incurred in connection with the Plan, except when the same has been affirmatively determined by a court order or by the affirmative and binding determination of an arbitrator, to be due to the gross negligence or willful misconduct of that person.

14

Section 7.7    Incapacity of Participant.   If any person entitled to receive a distribution under the Plan is physically or mentally incapable of personally receiving and giving a valid receipt for any payment due (unless a prior claim for the distribution has been made by a duly qualified guardian or other legal representative), then, unless and until a claim for the distribution has been made by a duly appointed guardian or other legal representative of the person, the Committee may provide for the distribution to be made to any other individual or institution then contributing toward or providing for the care and maintenance of the person.  Any payment made for the benefit of the person under this Section will be a payment for the account of such person and a complete discharge of any liability of the Bank and the Plan.

Section 7.8    Evidence.   Evidence required of anyone under the Plan may be by certificate, affidavit, document or other information which the person relying on the evidence considers pertinent and reliable, and signed, made or presented by the proper party or parties.

Section 7.9    Action by Bank.  Any action required of or permitted by the Bank under the Plan will be by resolution of the Board or by a person or persons authorized by resolution of the Board.

Section 7.10    Severability.   In the event any provisions of the Plan are held to be illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and endorsed as if the illegal or invalid provisions had never been contained in the Plan.

Section 7.11    Information to be Furnished by a Participant.   A Participant, or any other person entitled to benefits under the Plan, must furnish the Committee with any and all documents, evidence, data or other information the Committee considers necessary or desirable for the purpose of administering the Plan.  Benefit payments under the Plan are conditioned on a Participant (or other person who is entitled to benefits) furnishing full, true and complete data, evidence or other information to the Committee, and on the prompt execution of any document reasonably related to the administration of the Plan requested by the Committee.

Section 7.12    Attorneys' Fees.  If any action is commenced to enforce the provisions of the Plan, payment of attorneys' fees will be governed by the terms set forth in the mandatory “Agreement to Arbitrate” entered into between the Bank and the Participant.

Section 7.13    Binding on Successors.   The Plan will be binding upon and inure to the benefit of the Bank and its successors and assigns, and the successors, assigns, designees and estates of a Participant.  The Plan will also be binding upon and inure to the benefit of any successor organization succeeding to substantially all of the assets and business of the Bank, but nothing in the Plan will preclude the Bank from merging or consolidating into or with, or transferring all or substantially all of its assets to, another organization which assumes the Plan and all obligations of the Bank hereunder.  The Bank agrees that it will make appropriate provision for the preservation of a Participant's rights under the Plan in any agreement or plan which it may enter into to effect any merger, consolidation, reorganization or transfer of assets.  Upon such a merger, consolidation, reorganization or transfer of assets and assumption of Plan obligations of the Bank, the term “Bank” will refer to such other organization and the Plan will continue in full force and effect.

Section 7.14    Retention of Former Plans.  Each of the 2009 LTIP, 2010 LTIP, and 2011 LTIP, as amended herein, are incorporated herein by reference. Each of the 2009 LTIP, 2010 LTIP, and 2011 LTIP, as so amended, shall survive adoption of this Plan according to its respective terms. 

15

2013 PERFORMANCE GOALS AS APPROVED BY THE BOARD OF DIRECTORS:

Pursuant to Section 3.2 of the Federal Home Loan Bank of Indianapolis (“Bank”) Incentive Plan, effective as of January 1, 2012, and as amended on March 19, 2012, and May 18, 2012 (the “Plan”), the following Appendices were adopted by the Board of Directors (the “Board”) of the Bank on November 15, 2012, after consideration and review by the Human Resources Committee of the Board.  These Appendices to the Plan are effective as of January 1, 2013.  All capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Plan.

16

APPENDIX I

2013 PERFORMANCE PERIOD AWARDS FOR LEVEL II PARTICIPANTS
Federal Home Loan Bank of Indianapolis

A.    Incentive Opportunities
	
					
	 
	INCENTIVE DELIVERED IN CASH
AS % OF COMPENSATION*

	Position
	Threshold
	Target
	Maximum

	1ST VP
	20%
	25%
	30%

	VP of Sales
	20%
	30%
	40%

	VP
	15%
	20%
	25%

	AVP
	5%
	10%
	15%

	OTHER Employees
	2.5%
	7.5%
	10%

*Compensation is defined in Section 3.1 of the Federal Home Loan Bank of Indianapolis Incentive Plan

B.    2013 Performance Goals	
							
	MISSION GOALS
	WEIGHTED VALUE
	MINIMUM
 THRESHOLD
	TARGET
	MAXIMUM

	Bank10
	CRM
	Sales11

	1. PROFITABILITY1
	25%
	15%
	20%
	250 bp
	504 bp
	600 bp

	 
	 
	 
	 
	 
	 
	 

	2.  MEMBER PRODUCTS
	 
	 
	 
	 
	 
	 

	Member Advance Growth2
	10%
	5%
	20%
	1%
	3%
	8%

	 
	 
	 
	 
	 
	 
	 

	Advance Special Activity3
	5%
	5%
	10%
	6 points
	9 points
	12 points

	 
	 
	 
	 
	 
	 
	 

	MPP Production4
	10%
	5%
	15%
	$750 MM
	$1,250 MM
	$1,750 MM

	 
	 
	 
	 
	 
	 
	 

	New or Reactivated Traders5
	5%
	5%
	10%
	18 points
	24 points
	30 points

	 
	 
	 
	 
	 
	 
	 

	3. CORE BANKING SOLUTION6
	20%
	20%
	20%
	TDRA Operational12
	CBS Core Calypso Production-Ready by December 31, 201313
	CBS Core Calypso in Production by December 31, 201314

17

	
							
	MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD
	TARGET
	MAXIMUM

	Bank10
	CRM
	Sales11

	 
	 
	 
	 
	 
	 
	 

	4.  CORPORATE RISK MANAGEMENT
	 
	 
	 
	 
	 
	 

	Retained Earnings7
	10%
	10%
	2%
	4.0%
	4.15%
	4.30%

	CRM Memo8 
	5%
	10%
	1%
	2 memos
	4 memos
	5 memos

	ORM Reports and IS Reports
	5%
	5%
	1%
	2 ORM reports, and 1 IS report
	3 ORM reports, and 2 IS reports
	4 ORM reports, and 3 IS reports

	Special Risk Assessments, Risk Analysis or Risk Process Improvements9
	5%
	20%
	1%
	2
	4
	6

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks.  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law.  

2Member advances are calculated as the growth in the average daily balance of advances outstanding to members at par.  Average daily balances are used instead of point-in-time balances to eliminate point-in-time activity that may occur and to reward for the benefit of the income earned on advances balances while outstanding.  Members that become non-members during 2013 will be excluded from the calculation.
   
3For each Advance Special offering (i.e., each advance offering communicated to members on special terms), one (1) point is earned for an Advance Special offering if at least five (5) members participate in the offering for a combined total of $20 million or more. 

4Mortgage Purchase Program production, including FHA and conventional, will be the amount of all MDCs traded in 2013.  Assumes no capital requirement for MPP.  Excludes MPF.  It also assumes no material change in MPP authority under FHFA's regulation, policy, or law.  When calculating achievement between the minimum threshold and the performance maximum, no single member can account for more than 25% of conventional production.  

5One (1) point is earned for entering into an MPP transaction with each member that has never traded or not traded with MPP within the previous 12 months of their 2013 trade. Two (2) points are earned for entering into an MPP transaction with each member that has not engaged in such a transaction for sixty (60) or more days (a “Fading Member”).  Two points may be earned on a Fading Member only one time per member. 

6Status and reporting on these technology projects and their attainment to be provided in writing by the CIO and confirmed by the EVP-COO-CFO. The CIO and the EVP-COO-CFO will advise the Committee of unanticipated developments that could be anticipated to materially change the Bank's ability to achieve this goal.

7Total Retained Earnings divided by mortgage assets, measured at the end of each month.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS and Acquired Member Assets ("AMA") portfolios.  The year-end calculation will be the simple average of 12 month-end calculations.

8As per the Board meeting schedule, provide the Board the Corporate Risk Management (“CRM”) memo. 

18

9CRO will propose and CEO will evaluate whether to categorize these as special and whether work product was acceptable to count toward this goal.

10For all Level II Participants, excluding those addressed in the CRM and Sales columns, and excluding those in the Internal Audit department.

11For VP-Business Development Director, VP of Sales, other Account Managers and Market Research Staff, excluding their administrative support staff - such eligible individuals fall under the Bank column for the weighted value determination.

12Threshold level is met if: (i) Treasury Derivative Risk Analytics (“TDRA”) platform is operational; (ii) Calypso Risk Management Platform is operating on a stable environment; (iii) Treasury has completed the validation and calibration to market; and (iv) Risk Management Reporting is available to Treasury.  

13Target level is met if CBS Core Calypso Convergence Points in Production Ready status by December 31, 2013.  

14Maximum level is met if CBS Core Calypso Convergence Points in Production December 31, 2013.  

19

APPENDIX II

2013 PERFORMANCE PERIOD AWARDS FOR LEVEL I PARTICIPANTS
Federal Home Loan Bank of Indianapolis

A.    Incentive Opportunities
	
										
	 
	 
	 
	 
	50% of Total Incentive Earned & Vested At Year-End
	50% of Total Incentive Deferred for 3 Years

	 
	TOTAL INCENTIVE AS % OF COMPENSATION
	DFERRED INCENTIVE AS % OF COMPENSATION
	DFERRED INCENTIVE AS % OF COMPENSATION

	Position
	Threshold
	Target
	Maximum
	Threshold
	Target
	Maximum
	Threshold
	Target
	Maximum

	CEO
	50%
	75%
	100%
	25%
	37.5%
	50%
	25%
	37.5%
	50%

	EVP/SVP
	30%
	50%
	70%
	15%
	25%
	35%
	15%
	25%
	35%

*Compensation is defined in Section 3.1 of the Federal Home Loan Bank of Indianapolis Incentive Plan.
**Deferred Awards are subject to additional Performance Goals during the Deferral Performance Period.  Depending on the Bank's performance during the Deferral Performance Period, the Final Award will be worth 75 percent at Threshold, 100 percent at Target or 125 percent at Maximum of the original amount of the Deferred Award.

20

B.    2013 Performance Goals
	
								
	MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD
	TARGET
	MAXIMUM

	Bank10
	CRM

	1.  PROFITABILITY1
	25%
	15%
	250 bp
	504 bp
	600 bp

	 
	 
	 
	 
	 
	 

	2.  MEMBER PRODUCTS
	 
	 
	 
	 
	 

	Member Advance Growth2
	10%
	5%
	1%
	3%
	8%

	 
	 
	 
	 
	 
	 

	Advance Special Activity3
	5%
	5%
	6 points
	9 points
	12 points

	 
	 
	 
	 
	 
	 

	MPP Production4
	10%
	5%
	$750 MM
	$1,250 MM
	$1,750 MM

	 
	 
	 
	 
	 
	 

	New or Reactivated Traders5
	5%
	5%
	18 points
	24 points
	30 points

	 
	 
	 
	 
	 
	 

	3. CORE BANKING SOLUTION6
	20%
	20%
	TDRA Operational11
	CBS Core Calypso Production-Ready by December 31, 201312
	CBS Core Calypso in Production by December 31, 201313

	 
	 
	 
	 
	 
	 

	4.  CORPORATE RISK MANAGEMENT
	 
	 
	 
	 
	 

	Retained Earnings7
	10
	%
	10
	%
	4.0%
	4.15%
	4.30%

	CRM Memo8 
	5
	%
	10
	%
	2 memos
	4 memos
	5 memos

	ORM Reports and IS Reports
	5
	%
	5
	%
	2 ORM reports, and 1 IS report
	3 ORM reports, and 2 IS reports
	4 ORM reports, and 3 IS reports

	Special Risk Assessments, Risk Analysis or Risk Process Improvements9
	5
	%
	20
	%
	2
	4
	6

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks.  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law.  

2Member advances are calculated as the growth in the average daily balance of advances outstanding to members at par.  Average daily balances are used instead of point-in-time balances to eliminate point-in-time activity that may occur and to reward for the benefit of the income earned on advances balances while outstanding.  Members that become non-members during 2013 will be excluded from the calculation.
   
3For each Advance Special offering (i.e., each advance offering communicated to members on special terms), one (1) point is earned for an Advance Special offering if at least five (5) members participate in the offering for a combined total of $20 million or more. 

4Mortgage Purchase Program production, including FHA and conventional, will be the amount of all MDCs traded in 2013.  Assumes no capital requirement for MPP.  Excludes MPF.  It also assumes no material change in MPP authority under FHFA's regulation, policy, or law.  When calculating achievement between the minimum threshold and the performance maximum, no 

21

single member can account for more than 25% of conventional production.  

5One (1) point is earned for entering into an MPP transaction with each member that has never traded or not traded with MPP within the previous 12 months of their 2013 trade. Two (2) points are earned for entering into an MPP transaction with each member that has not engaged in such a transaction for sixty (60) or more days (a “Fading Member”).  Two points may be earned on a Fading Member only one time per member.

6Status and reporting on these technology projects and their attainment to be provided in writing by the CIO and confirmed by the EVP-COO-CFO. The CIO and the EVP-COO-CFO will advise the Committee of unanticipated developments that could be anticipated to materially change the Bank's ability to achieve this goal.

7Total Retained Earnings divided by mortgage assets, measured at the end of each month.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS and AMA assets portfolios.  The year-end calculation will be the simple average of 12 month-end calculations.

8As per the Board meeting schedule, provide the Board the Corporate Risk Management (“CRM”) memo.

9CRO will propose and CEO will evaluate whether to categorize these as special and whether work product was acceptable to count toward this goal.

10For Level I Participants other than those in CRM and Internal Audit.

11Threshold level is met if: (i) Treasury Derivative Risk Analytics (“TDRA”) platform is operational; (ii) Calypso Risk Management Platform is operating on a stable environment; (iii) Treasury has completed the validation and calibration to market; and (iv) Risk Management Reporting is available to Treasury.  

12Target level is met if CBS Core Calypso Convergence Points in Production Ready status by December 31, 2013.  

13Maximum level is met if CBS Core Calypso Convergence Points in Production December 31, 2013.  

22

C.    2014-2016 Performance Goals

	
						
	MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD4
	TARGET4
	MAXIMUM4

	Bank3
	CRM

	 
	 
	 
	 
	 
	 

	1.  PROFITABILITY1
	35%
	35%
	25 bp
	50 bp
	150 bp

	 
	 
	 
	 
	 
	 

	2.  RETAINED EARNINGS2
	35%
	35%
	3.50%
	3.90%
	4.30%

	 
	 
	 
	 
	 
	 

	3. PRUDENTIAL
	30%
	30%
	Achieve 2 Prudential Standards
	---
	Achieve all 3 Prudential Standards

	         Maintain a regulatory capital-
         to-assets ratio of at least
         4.16% as measured on each
         quarter-end in 2016.
         
	 
	 
	 
	 
	 

	        Without Board pre-approval,
        do not purchase more than
        $2.5 billion of conventional
        MPP assets per plan year.
	 
	 
	 
	 
	 

	        Award to FHLBI members the 
        annual AHP funding 
        requirement in each plan year.
	 
	 
	 
	 
	 

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks.  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law. This will be computed using a simple annual average over the three-year period.

2Total Retained Earnings divided by mortgage assets, measured at the end of each month.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS and AMA assets portfolios.  The calculation will be the simple average of 36 month-end calculations.

3For Level I Participants other than those in CRM and Internal Audit.

4Deferred Awards are subject to additional Performance Goals for the Deferral Performance Period.  Depending on the Bank's performance during the Deferral Performance Period, the Final Award will be worth 75 percent at Threshold, 100 percent at Target or 125 percent at Maximum of the original amount. 

23

APPENDIX III

ANNUAL AWARD TARGETS FOR 2010 AND 2011 LONG TERM INCENTIVE PLANS
Federal Home Loan Bank of Indianapolis
[Unchanged from prior year except for AMA and JCEA-related measures]

A.    Calendar Year 2012 for the 2010 LTIP and 2011 LTIP
For purposes of calculating Final Awards* for the 2010 LTIP and 2011 LTIP for eligible Participants,* with respect to the portion of the Performance Period* measured as to calendar year 2012, the following table shall be used to determine the annual achievement average, which shall in turn be multiplied by the Participant's 2010 base salary for the 2010 LTIP benefit calculation, and by the Participant's 2011 base salary for the 2011 LTIP benefit calculation. These calculations are used for purposes of determining the three-year achievement average percentage pursuant to the terms of the 2010 LTIP and the 2011 LTIP.

* As such terms are defined in the 2010 LTIP and 2011 LTIP, respectively.

	
						
	2012 MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD
(60%)
	TARGET

(80%)
	MAXIMUM

(100%)

	Bank3
	CRM

	1.  PROFITABILITY1
	50%
	50%
	100 bp
	266 bp
	300 bp

	2.  RETAINED EARNINGS2
	50%
	50%
	3.50%
	3.75%
	3.90%

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks.  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law. 

2Total Retained Earnings divided by mortgage assets.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS and AMA asset portfolios.  The year-end calculation will be the simple average of 12 month-end calculations.

3For Level I Participants other than those in CRM and Internal Audit.

B.    Calendar Year 2013 for the 2011 LTIP
For purposes of calculating Final Awards under the 2011 LTIP for eligible Participants, with respect to the portion of the Performance Period measured as to calendar year 2013, the following preliminary table shall be used to determine the annual achievement average, which shall in turn be multiplied by the Participant's 2011 base salary for the 2011 LTIP benefit calculation. These preliminary calculations are used for purposes of determining the three-year achievement average percentage pursuant to the 2011 LTIP.  The Board may review and revise this table at any time.  If the Board does not revise this table, the preliminary figures shall be deemed to be final.

24

	
						
	 2013 MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD
(60%)
	TARGET

(80%)
	MAXIMUM

(100%)

	Bank3
	CRM

	1.  PROFITABILITY1
	50%
	50%
	100 bp
	266 bp
	300 bp

	2.  RETAINED EARNINGS2
	50%
	50%
	3.50%
	3.75%
	3.90%

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks (the “JCEA”).  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law.

2Total Retained Earnings divided by mortgage assets.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS 
and AMA asset portfolios.  The year-end calculation will be the simple average of the 12 month-end calculations.

3For Level I Participants other than those in CRM and Internal Audit.

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APPENDIX IV

AWARDS ADDRESSING 2015 GAP YEAR FOR LEVEL I PARTICIPANTS
Federal Home Loan Bank of Indianapolis
[Unchanged from prior year except for AMA and JCEA-related measures]

A.    Incentive Opportunities
	
		
	 
	LONG-TERM INCENTIVE % OF 
ACTUAL 2011 SHORT-TERM 
YEAR-END INCENTIVE PAID IN 2012

	Position
	Award Factor

	CEO
	60.0%

	EVP/SVP
	67.0%

B.    2012-2014 Performance Plan Goals for Gap Calculation

	
						
	MISSION GOALS
	WEIGHTED VALUE
	MINIMUM THRESHOLD4
	TARGET4
	MAXIMUM4

	Bank3
	CRM

	1.  PROFITABILITY1
	35%
	35%
	25 bp
	50 bp
	150 bp

	 
	 
	 
	 
	 
	 

	2.  RETAINED EARNINGS2
	35%
	35%
	3.50%
	3.90%
	4.30%

	 
	 
	 
	 
	 
	 

	3.  PRUDENTIAL
	30%
	30%
	Achieve 2 Prudential Standards
	---
	Achieve all 3 Prudential Standards

	Maintain a regulatory capital-to-assets ratio of at least 4.16% as measured on each quarter-end in 2014.
         
	 
	 
	 
	 
	 

	Without Board pre-approval, do not purchase more than $2.5 billion of conventional AMA assets per plan year.
	 
	 
	 
	 
	 

	Award to FHLBI members the annual AHP funding requirement in each plan year.
	 
	 
	 
	 
	 

1Profitability, for purposes of this goal, is defined as the potential dividend rate in excess of the Bank's cost of funds rate.  The potential dividend rate is the Bank's adjusted net income rate.  Adjusted net income is defined as GAAP net income:(i) adjusted for the effects of current and prior period Advance prepayments and debt extinguishments, (ii) adjusted for the effects of any mark-to-market adjustments and certain other effects from derivatives and hedging activities under SFAS 133, (iii) increased by the interest expense under SFAS 150, and (iv) reduced by the  portion of net income to be added to restricted retained earnings under the Joint Capital Enhancement Agreement, as amended, dated August 5, 2011, by and among the twelve Federal Home Loan Banks.  The Bank's adjusted net income rate is the adjusted net income, as defined above, as a percentage of average total regulatory capital stock.  Assumes no material change in investment authority under FHFA's regulation, policy or law. The Potential Dividend will be computed using a simple annual average over the three-year period.

26

2Total Retained Earnings divided by mortgage assets.  Calculated each month as Total Retained Earnings divided by the sum of the carrying value of the MBS and AMA asset portfolios.  The calculation will be the simple average of 36 month-end calculations.

3For Level I Participants other than those in CRM and Internal Audit.

4Gap Year Awards are subject to additional Performance Goals for the Gap Year Performance Period.  Depending on the Bank's performance during the Gap Year Performance Period, the Final Award will be worth 75 percent at Threshold, 100 percent at Target or 125 percent at Maximum of the original amount.

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APPENDIX V

FORM OF NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT

This Agreement is entered into as of the ____ day of _____________, 201_, by and between the FEDERAL HOME LOAN BANK OF INDIANAPOLIS, a corporation organized under the laws of the United States (the “Bank”) and ____________________ (the “Executive”).
WHEREAS, the Bank sponsors the Federal Home Loan Bank of Indianapolis Incentive Plan (the “Plan”); and
WHEREAS, as a condition of participation in the Plan, the Bank requires that the Executive agree to the terms and conditions found within this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual promises and agreements contained herein and other good and valuable consideration, the receipt, legal adequacy and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.Non-Disclosure; Return of Confidential Information and Other Property.

		
	(a)
	Access to Confidential Information.  The Executive understands, acknowledges and agrees that during the course of his or her employment with the Bank he or she has gained or will gain information regarding, knowledge of, and familiarity with, the Confidential Information of the Bank (as defined in subsection (c)) that would cause irreparable damage and harm to the Bank if it was disclosed.  The Executive understands, acknowledges and agrees that the Confidential Information has substantial economic value because it is not known or readily ascertainable by proper means by others who could obtain economic value from it.  The Executive also acknowledges and agrees that the Bank uses reasonable means to maintain the secrecy and confidentiality of the Confidential Information.

		
	(b)
	Non-Disclosure.  At all times while the Executive is employed by the Bank, and at all times thereafter, the Executive will not (i) directly or indirectly disclose, provide or discuss any Confidential Information with or to any Person (as defined in subsection (d)) other than those directors, officers, employees, representatives and agents of the Bank who need to know such Confidential Information for a proper corporate purpose, and (ii) directly or indirectly use any Confidential Information (A) to compete against the Bank, or (B) for the Executive's own benefit, or for the benefit of any Person other than the Bank.

		
	(c)
	Confidential Information Defined.  For purposes of this Agreement, the term “Confidential Information” means any and all:

		
	(i)
	materials, records, data, documents, lists, writings and information (in each case, whether in writing, printed, verbal, electronic, computerized or otherwise) (A) relating or referring in any manner to the business, operations, affairs, financial condition, results of operation, cash flow, assets, liabilities, sales, revenues, income, estimates, projections, policies, strategies, techniques, methods, products, developments, suppliers, regulators, members, relationships and/or customers of the Bank that are confidential, proprietary or not otherwise publicly available, in any 

28

event not without a breach of this Agreement, or (B) that the Bank has deemed confidential, proprietary, nonpublic or not otherwise publicly available without breaching this Agreement;

		
	(ii)
	trade secrets of the Bank, as defined in Indiana Code Section 24-2-3-2, as amended, or any successor statute; and

		
	(iii)
	any and all copies, summaries, analyses and extracts which relate or refer to or reflect any of the items set forth in (i) or (ii) above.  The Executive agrees that all Confidential Information is confidential and is and at all times will remain the property of the Bank.

		
	(d)
	Person Defined.  For purposes of this Agreement, the term “Person” will mean any natural person, proprietorship, partnership, corporation, limited liability company, bank, organization, firm, business, joint venture, association, trust or other entity and any government agency, body or authority.

		
	(e)
	Return of Confidential Information and Other Property.  The Executive covenants and agrees:

		
	(i)
	to keep all Confidential Information subject to the Bank's custody and control and to promptly return to the Bank all Confidential Information that is still in the Executive's possession or control at the termination of the Executive's employment with the Bank; and

		
	(ii)
	promptly upon termination of the Executive's employment with the Bank, to return to the Bank, at the Bank's principal office, all vehicles, equipment, computers, credit cards and other property of the Bank and to cease using any of the foregoing.

		
	(f)
	Exceptions from Confidentiality Obligations.  Section 1 shall not be deemed to prevent the Executive from making disclosures required by applicable regulation, law, agency order, or court order, to the extent the Executive provides reasonable written notice of such disclosure requirement to the Bank prior to such disclosure, to the extent such prior notice is not prohibited, to permit the Bank to contest the disclosure of such information.

2.Non-Disparagement.  The Executive agrees to not communicate disparaging remarks to third parties about the Bank, its directors, officers or employees.  Likewise, the Bank agrees not to disparage the Executive or his or her skills or job performance to third parties.  However, nothing in this paragraph shall prohibit the Bank or the Executive from testifying truthfully under oath.

29

3.Non-Solicitation and No-Hire.  The Executive hereby understands, acknowledges and agrees that, by virtue of his or her position with the Bank, the Executive has and will have advantageous familiarity and personal contacts with the employees of the Bank and has and will have advantageous familiarity with the business, operations and affairs of the Bank.  In addition, the Executive understands, acknowledges and agrees that the business of the Bank is highly competitive.  Accordingly, at all times while the Executive is employed by the Bank and for a twelve-month period following Termination of Service, the Executive will not, directly or indirectly, or individually or together with any other Person, as owner, shareholder, investor, member, partner, proprietor, principal, director, officer, Executive, manager, agent, representative, independent contractor, consultant or otherwise induce, request or attempt to influence any Bank employee who was employed by the Bank during the twelve-month period prior to Termination of Service, to terminate his or her employment with the Bank.  In addition, the Executive agrees that for a period of twelve months following the Executive's Termination of Service, Executive will not hire any Bank employee who was employed by the Bank during the twelve-month period prior to the Executive's Termination of Service.

4.Periods of Noncompliance and Reasonableness of Periods.  The restrictions and covenants contained in Section 3 will not run during all periods of noncompliance and will apply during the Term of this Agreement and for the full periods specified in Section 3.  The Bank and the Executive understand, acknowledge and agree that the restrictions and covenants contained in Section 3 are reasonable in view of the nature of the business in which the Bank is engaged, the Executive's position with the Bank and the Executive's advantageous knowledge and familiarity with, the Bank's employees, business, operations, affairs and customers.

The Bank's obligation to pay an award to the Executive pursuant to the Federal Home Loan Bank of Indianapolis Incentive Plan will immediately terminate in the event the Executive breaches any of the provisions of Section 1 or 3 and all outstanding awards will be forfeited.  Notwithstanding the foregoing:
		
	(a)
	the Executive's covenants set forth in Sections 1 or 3 will continue in full force and effect and be binding upon the Executive;

		
	(b)
	the Bank will be entitled to the remedies specified in Section 6; and

		
	(c)
	the Bank will be entitled to its damages, costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) resulting from or relating to the successful prosecution of the Executive's breach of any of the provisions of Section 1 or 3.

5.Survival of Certain Provisions.  Upon any termination of the Executive's employment with the Bank, the Executive and the Bank hereby expressly agree that the provisions of Sections 1, 3, 4 and 6 will continue to be in full force and effect and binding upon the Executive and the Bank in accordance with the applicable respective provisions of such Sections.

6.Remedies.  The Executive agrees that the Bank will suffer irreparable damage and injury and will not have an adequate remedy at law in the event of any actual, threatened or attempted breach by the Executive of any provision of Section 1 or 3.  Accordingly, in the event of a threatened, attempted or actual breach by the Executive of any provision of Section 1 or 3, in addition to all other remedies to which the Bank is entitled at law, in equity or otherwise, the Bank may be entitled to a temporary restraining order and a permanent injunction or a decree of specific performance of any provision of Section 1 or 3.  The foregoing remedies will not be deemed to be the exclusive rights or remedies of the Bank for any breach of or noncompliance with this Agreement by the Executive but will be in addition to all other rights and remedies available to the Bank at law, in equity or otherwise.

30

7.Severability.  In case any one or more of the provisions (or any portion thereof) contained herein will, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provision of this Agreement, but this Agreement will be construed as if such invalid, illegal or unenforceable provision or provisions (or portion thereof) had never been contained herein.  If any provision of this Agreement will be determined by a court of competent jurisdiction to be unenforceable because of the provision's scope, duration or other factor, then such provision will be considered divisible and the court making such determination will have the power to reduce or limit (but not increase or make greater) such scope, duration or other factor or to reform (but not increase or make greater) such provision to make it enforceable to the maximum extent permitted by law, and such provision will then be enforceable against the appropriate party hereto in its reformed, reduced or limited form; provided, however, that a provision will be enforceable in its reformed, reduced or limited form only in the particular jurisdiction in which a court of competent jurisdiction makes such determination.

8.Entire Agreement.  This Agreement sets forth the entire understanding of the parties hereto with respect to its subject matter, merges and supersedes all prior and contemporaneous understandings with respect to its subject matter, and may not be waived or modified, in whole or in part, except in writing signed by each of the parties hereto.  No waiver of any provision of this Agreement in any instance will be deemed to be a waiver of the same or any other provision in any other instance.  The recitals set forth above are incorporated herein by this reference.

9.Effect and Modification.  No statement or promise, except as set forth herein, has been made with respect to the subject matter of this Agreement.  No modification or amendment will be effective unless in writing and signed by the Executive and an officer of the Bank (other than the Executive).

10.Non-Waiver.  The Bank's or the Executive's failure or refusal to enforce all or any part of, or the Bank's or the Executive's waiver of any breach of this Agreement, will not be a waiver of the Bank's or the Executive's continuing or subsequent rights under this Agreement, nor will such failure or refusal or waiver have any effect on the subsequent enforceability of this Agreement.

11.Non-Assignability.  This Agreement contemplates that the Executive will personally provide the services described herein, and accordingly, the Executive may not assign the Executive's rights or obligations hereunder, whether by operation of law or otherwise, in whole or in part, without the prior written consent of the Bank.

31

12.Notice.  Any notice, request, instruction or other document to be given hereunder to any party will be in writing and delivered by hand, telegram, registered or certified United States mail return receipt requested, or other form of receipted delivery, with all expenses of delivery prepaid, as follows:

If to the Executive:        _________________________
_________________________
_________________________
_________________________
If to the Bank:         Federal Home Loan Bank of Indianapolis
c/o General Counsel
8250 Woodfield Crossing Blvd.
Suite 400
Indianapolis, IN 46240
13.Governing Law.  This Agreement is being delivered in and will be governed by the laws of the State of Indiana without regard to the choice of law principles thereof.  Any dispute regarding this Agreement will be brought in any Indiana state or federal court having jurisdiction in the matter and located in Marion County, Indiana, and the Executive expressly consents to the jurisdiction of such courts.

14.Prior Agreement.  The Executive represents and warrants to the Bank that the Executive is not a party to or otherwise bound by any agreement that would restrict in any way the performance by the Executive of the Executive's duties, services and obligations under this Agreement, that the Executive has disclosed to the Bank all employment type agreements to which the Executive has been bound, including without limitation employment agreements, consulting agreements, non-compete agreements or covenants, confidentiality or non-disclosure agreements or covenants, and intellectual property assignment agreements, and that the Bank will not have any liability to any third party arising out of the Executive entering into this Agreement or performing hereunder.

15.Effect of Headings.  The descriptive headings of the Sections and, where applicable, subsections, of this Agreement are inserted for convenience and identification only and do not constitute a part of this Agreement for purposes of interpretation.

16.Counterparts.  This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which collectively will constitute one and the same instrument.

17.Miscellaneous.  Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Plan.

32

IN WITNESS WHEREOF, the Bank, by its officer thereunder duly authorized, and the Executive, have caused this Non-Competition, Non-Solicitation and Non-Disclosure Agreement to be executed as of the day and year first above written.
	
		
	FEDERAL HOME LOAN BANK
OF INDIANAPOLIS    
	EXECUTIVE

	 
	 

	By:__________________________________
	____________________________________________

	Its:__________________________________
	 

	 
	 

	By:__________________________________
	 

	Its:__________________________________
	 

            

33

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