Document:

ex107changeincontrol

    CHANGE IN CONTROL AGREEMENT  This Change in Control Agreement (the “Agreement”) is made and entered into as of  DATE (the “Effective Date”), by and between Lawson Products, Inc., an Illinois corporation  (the “Company”), and NAME (the “Executive”).  WHEREAS, the Company wishes to assure itself of the continuity of the Executive’s  services and has determined that it is appropriate that the Executive receive certain payments in  the event that the Executive’s employment is terminated under specified circumstances as more  fully described below; and  WHEREAS, the Company and the Executive accordingly desire to enter into this  Agreement on the terms and conditions set forth below;  NOW, THEREFORE, in consideration of the premises and mutual covenants set forth  herein, the parties hereto agree as follows:  1. Agreement Term.  The “Term” of this Agreement shall begin on the Effective  Date and shall continue through the one-year anniversary of the Effective Date; provided,  however, that as of the one-year anniversary of the Effective Date and on each one-year  anniversary thereafter, the Term shall automatically be extended for one additional year unless,  not later than 30 days prior to such applicable anniversary date, either party shall have given  written notice to the other party that it does not wish to extend the Term; provided, further, that if  a Change in Control shall have occurred on or prior to the date that this Agreement would  otherwise terminate, and notwithstanding any prior notice from one party to the other party to the  contrary, the Term of this Agreement shall automatically be deemed extended and shall continue  until the one-year anniversary of the date on which the Change in Control occurs.  2. Certain Definitions.  In addition to terms otherwise defined herein, the following  capitalized terms used in this Agreement shall have the meanings specified below:  (a) Accrued Compensation.  The term “Accrued Compensation” shall mean:  (i) any accrued and unpaid base salary and any accrued and unused  vacation pay through the effective date of Executive’s termination;  (ii) any annual incentive bonus earned with respect to a prior year and  unpaid as of the effective date of Executive’s termination;  (iii) any additional payments, awards, or benefits, if any, which  Executive is eligible to receive pursuant to the terms of any  applicable Benefit Plans; and  (iv) all post-employment benefits required under applicable law.  (b) Benefit Plans.  The term “Benefit Plans” means the following standard  benefits, and any other benefit plans in which Executive may participate pursuant to such plan’s  terms, it being understood and agreed that the Company or Parent may modify or terminate such  

 

    benefits from time to time to the extent and on such terms as the Company or Parent shall  determine in its sole discretion:  (i) coverage under the Company’s group health plan on such terms as  provided to other Company officers;  (ii) long-term disability insurance coverage;  (iii) group term life insurance;  (iv) accidental death insurance; and  (v) participation in the Company’s 401(k) plan, profit-sharing  retirement plan and executive deferral plan.  (c) Board.  The term “Board” shall mean the Board of Directors of Parent.   (d) Cause.  The term “Cause” shall mean any of the following:  (i) violation by Executive of any agreement between Executive and  the Company or any law relating to non-competition, trade secrets,  inventions, non-solicitation or confidentiality;  (ii) material breach or default of any of Executive’s duties or other  obligations or covenants under this Agreement, which has not been  cured within 30 days of written notice thereof to Executive;  (iii) Executive’s gross negligence, dishonesty or willful misconduct;  (iv) any act or omission by Executive which has a material adverse  effect on the Company’s business, reputation, goodwill or  customer relations;  (v) conviction of or pleading nolo contendere to a crime by Executive  (other than traffic related offenses);  (vi) any act or omission by Executive which, at the time it occurs, is in  material violation of any Company policy, such as they now exist  or hereafter are supplemented, amended, modified or restated; or  (vii) an act of fraud or embezzlement or the misappropriation of  property by Executive.  (e) Change in Control.  The term “Change in Control” shall mean the  occurrence of any of the following:  (i) any “person” or “group” of “persons” (as such terms are used in  Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,  as amended, and the rules promulgated thereunder) is or becomes  

 

    the beneficial owner, directly or indirectly, of securities  representing voting power, as of the date of determination, of then  outstanding voting securities representing 50% or more of the  combined voting power of Parent’s then outstanding securities as  of such date of determination; or  (ii) there is a merger, consolidation or reorganization involving Parent,  or any direct or indirect subsidiary of Parent, unless:  (A) the stockholders of Parent immediately before such  merger, consolidation or reorganization will own,  directly or indirectly, immediately following such  merger, consolidation or reorganization, at least  fifty percent (50%) of the combined voting power  of the outstanding voting securities of the  corporation resulting from such merger,  consolidation or reorganization (the “Surviving  Corporation”) or any parent thereof in  substantially the same proportion as their ownership  of the voting securities of Parent immediately  before such merger, consolidation or reorganization;  and  (B) the individuals who were members of the Board  immediately prior to the execution of the agreement  providing for such merger, consolidation or  reorganization constitute a majority of the members  of the board of directors of the Surviving  Corporation (or parent thereof); and  (C) no “person” or “group” of “persons” as defined  above is the beneficial owner of forty percent (40%)  or more of the combined voting power of the then  outstanding voting securities of the Surviving  Corporation (or parent thereof); or  (iii) there is a sale or other disposition of all or substantially all of the  assets of Parent to an entity other than an entity:  (A) of which at least fifty percent (50%) of the  combined voting power of the outstanding voting  securities are owned, directly or indirectly, by  stockholders of Parent in substantially the same  proportion as their then current ownership of the  voting securities of Parent; and  

 

    (B) of which a majority of the board of directors is  comprised of the individuals who were members of  the Board immediately prior to the execution of the  agreement providing for such sale or disposition;  and  (C) of which no “person” or “group” of “persons” as  defined above is the beneficial owner of forty  percent (40%) or more of the combined voting  power of the then outstanding voting securities of  such entity (or parent thereof); or  (iv) Individuals who, as of the date hereof, constitute the Board (the  “Incumbent Board”) cease for any reason to constitute at least a  majority of the Board; provided, however, that any individual  becoming a director subsequent to the effective date hereof whose  election, or nomination for election by Parent stockholders, was  approved by a vote of at least four-fifths (4/5) of the directors then  comprising the Incumbent Board shall be considered as though  such individual were a member of the Incumbent Board, unless  any such individual’s initial assumption of office occurs as a result  of either an actual or threatened election contest (including, but not  limited to, a consent solicitation).  (f) Code.  The term “Code” shall mean the Internal Revenue Code of 1986,  as amended.   (g) Code Section 409.  The term “Code Section 409A” shall mean Section  409A of the Code and all regulations issued thereunder and applicable guidance thereto.   (h) Competitive Products, Systems and Services.  The term “Competitive  Products, Systems and Services” shall mean products, systems or services in existence or under  development during Executive’s employment with the Company which are the same as or  substantially similar to or functional equivalents of those of the Lawson Entities including,  without limitation, those which are or may be provided to the Lawson Entities’ customers on  behalf of the Lawson Entities by employees, agents, or sales representatives of the Lawson  Entities.   (i) Confidential Information.  The term “Confidential Information” shall  mean all information, including, but not limited to, trade secrets disclosed to Executive or known  by Executive as a consequence of or through Executive’s employment by the Company,  concerning the products, services, systems, customers and agents of the Lawson Entities, and  specifically including without limitation:  computer programs and software, unpatented  inventions, discoveries or improvements; marketing, organizational and product research and  development; marketing techniques; promotional programs; compensation and incentive  programs; customer loyalty programs; inventory systems; business plans; sales forecasts;  personnel information, including but not limited to the identity of employees and agents of the  

 

    Lawson Entities, their responsibilities, competence, abilities, and compensation; pricing and  financial information; customer lists and information on customers or their employees, or their  needs and preferences for the Lawson Entities’ Products, Systems and Services; information  concerning planned or pending acquisitions or divestitures; and information concerning  purchases of major equipment or property, and which:  (i) has not been made generally available to the public; and  (ii) is useful or of value to the current or anticipated business or  research or development activities of the Lawson Entities, or of  any customer or supplier of the Lawson Entities.  Confidential Information shall not include information which:  (x) is in or hereafter enters the public domain through no fault of  Executive;  (y) is obtained by Executive from a third party having the legal right to  use and to disclose the same without restriction; or   (z) was in the possession of Executive prior to receipt from the  Lawson Entities (as evidenced by Executive’s written records  predating the first date of employment with the Company).  Confidential Information also does not include Executive’s general skills and experience as  defined under the governing law of this Agreement.  (j) Equity Awards.  The term “Equity Awards” shall mean the stock options,  restricted stock, stock awards, phantom stock units, stock appreciation units, stock performance  rights, shareholder value appreciation rights or other such equity-based compensation as shall  have been granted to Executive on or before the effective date of the termination of Executive’s  employment.  (k) Good Reason.  The term “Good Reason” shall mean any of the following:  (i) a material diminution in Executive’s base compensation;  (ii) a material diminution in Executive’s authority, duties or  responsibilities;  (iii) a material change (with such change to be not less than 50 miles)  in the geographic location at which Executive must perform  Executive’s services; or  (iv) any other action or inaction that constitutes a material breach by  the Company of this Agreement.  

 

    (l) Lawson Entities.  The term “Lawson Entities” shall mean Parent, any  Subsidiary of Parent and any other entity in which any one or more of them has an ownership  interest at any time during Executive’s employment with the Company and during the Restriction  Period whether such entity is in the United States or elsewhere.  (m) Lawson Entities’ Products, Systems and Services.  The term “Lawson  Entities’ Products, Systems and Services” shall mean:  (i) the acquisition for and the distribution and sale of fasteners, parts,  hardware, pneumatics, hydraulic and other flexible hose fittings,  tools, safety items and electrical and shop supplies, automotive and  vehicular products, chemical specialties, maintenance chemicals  and other chemical products, welding products and related items,  all as more particularly described in the Lawson Entities’ sales kits  and manuals;  (ii) the sale and distribution and the providing of systems and services  related to the items described in clause (i);  (iii) the manufacture, sale and distribution of production and  specialized parts and supplies described in clause (i);  (iv) the provision of just-in-time inventories of component parts  described in clause (i) to original equipment manufacturers and of  maintenance and repair parts described in clause (i) to a wide  variety of users; and  (v) the provision of in-plant inventory systems and of electronic  vendor-managed, inventory systems to various customers, related  to the items described in clause (i).   (n) Parent.  The term “Parent” shall mean Lawson Products, Inc., a Delaware  corporation.  (o) Restriction Period.  The term “Restriction Period” shall mean the period  of time in which Executive is employed by the Company and a period of twelve months after the  effective date of Executive’s termination.   (p) Section 409A Change in Control.  The term “Section 409A Change in  Control” means any “change in control event” within the meaning of Code Section 409A  determined in accordance with the uniform methodology and procedures adopted by the  Company.  (q) Subsidiary.  The term “Subsidiary” means, with respect to any person or  entity, any corporation, association or other entity of which more than 50% of the combined  voting power is owned, directly or indirectly, by such person or entity and one or more other  Subsidiaries of such person or entity.  

 

    (r) Unauthorized Person or Entity.  The term “Unauthorized Person or  Entity” shall mean any individual or entity who or which has not signed an appropriate secrecy  or confidentiality agreement with the Lawson Entities, or is not a current or target customer with  whom Confidential Information is shared in the mutual interest of that person or entity and the  Lawson Entities.  3. Payments Due Upon Specified Terminations.  (a) Payments Due Upon Termination Without Cause by the Company or for  Good Reason by Executive After a Change in Control.  In lieu of the payments and other benefits  due under any other severance policy maintained by or on behalf of the Company in which  Executive is otherwise entitled to participate, in the event the Company terminates Executive’s  employment without “Cause” or if the Executive terminates Executive’s employment for “Good  Reason”, but only in each case within one year following a Change in Control, the Company  shall have no obligation to Executive, except:  (i) the Company shall pay Executive any Accrued Compensation;  (ii) the Company shall pay Executive (x) an amount equal to one times  Executive’s then current annual base salary, and (y) an amount  equal to the greater of (A) Executive’s target annual incentive  bonus with respect to the year in which Executive’s termination  occurs or (B) the annual incentive bonus most recently paid to  Executive.  Subject to Section 3(b), such amounts shall be paid in a  lump sum, to the extent a Section 409A Change in Control has  occurred contemporaneously with the Change in Control (or  anytime in the calendar year prior to the effective date of  Executive’s termination) no later than 30 days after the effective  date of Executive’s termination, or to the extent a Section 409A  Change in Control has not occurred during such period, they shall  be paid in twelve equal monthly installments commencing one  month after the effective date of Executive’s termination;  (iii) Executive shall continue to be covered under the Company’s group  health plan as set forth in the definition of “Benefit Plans”,  including any spousal and dependent coverage, at active employee  rates, for twelve months after the effective date of Executive’s  termination (which coverage may result in imputed income), and,  thereafter, Executive shall be eligible to exercise Executive’s rights  to COBRA continuation coverage with respect to such group  health plan for Executive, and, where applicable, Executive’s  spouse and eligible dependents, at Executive’s expense; and  (iv) all of Executive’s outstanding Equity Awards, if any, shall  immediately vest upon the effective date of Executive’s  termination to the extent not already vested, and Executive shall  have until the earlier of (A) ninety (90) days following the  

 

    effective date of Executive’s termination (or such longer exercise  period that may be provided in an award agreement evidencing  such Equity Award) and (B) the term of such equity Award to  exercise any vested Equity Award that is subject to being  exercised.  (b) Six (6) Month Delay.  If, at the time Executive becomes entitled to  payments and benefits under Section 3(a) of this Agreement (“Severance Payment”), Executive  is a Specified Employee (within the meaning of Code Section 409A and using the identification  methodology selected by the Company from time to time), then, notwithstanding any other  provision in Section 3(a) to the contrary, the following provision shall apply.  No Severance  Payment considered by the Company in good faith to be deferred compensation under Code  Section 409A that is payable upon Executive’s separation from service (as defined and  determined under Code Section 409A), and not subject to an exception or exemption thereunder,  shall be paid to Executive until the date that is six (6) months after Executive’s effective date of  termination.  Any such Severance Payment that would otherwise have been paid to Executive  during this six-month period shall instead be aggregated and paid to Executive on or as soon as  administratively feasible after the date that is six (6) months after Executive’s effective date of  termination, but not later than 60 days after such date.  Any Severance Payment to which  Executive is entitled to be paid after the date that is six (6) months after Executive’s effective  date of termination shall be paid to Executive in accordance with the terms of Section 3(a).  (c) Release.  Executive shall not be entitled to receive any of the payments or  benefits set forth in this Section 3 (except Accrued Compensation), and said payments and  benefits shall be forfeited without further action by the Company, unless Executive (or if  applicable, Executive’s beneficiaries and/or estate) executes a general release substantially in the  form of Exhibit A (the “General Release”) and, on or prior to the 60th day following the date of  termination (or such shorter period as set forth therein), such General Release becomes effective  and irrevocable in accordance with the terms thereof.  With respect to any of the payments or  benefits pursuant to this Section 3 considered by the Company in good faith to be deferred  compensation under Code Section 409A, any amounts that would otherwise be payable during  the 60-day period in the absence of the preceding General Release requirement shall be payable  and effective on the 60th day after Executive’s termination of employment.   (d) Additional Provisions for Termination for Good Reason.  Executive is  entitled to terminate Executive’s employment for Good Reason only if:  (i) one or more of the conditions constituting Good Reason occurs  without Executive’s written consent;  (ii) Executive provides notice to the Company of the existence of a  condition constituting Good Reason within 15 days of the initial  occurrence of such condition;   (iii) the Company fails to remedy such condition constituting Good  Reason within 30 days of being provided notice of such condition  by Executive; and   

 

    (iv) Executive voluntarily terminates Executive’s employment within  15 days of the expiration of the remedy period specified in clause  (iii).   (e) Other Events of Employment Termination.  If the Company terminates  Executive’s employment with “Cause” or if Executive terminates Executive’s employment for  any reason not constituting “Good Reason”, the Company shall have no obligation to Executive,  except that the Company shall pay Executive any Accrued Compensation.  4. Protection of Company Assets.  (a) Non-Competition.  Executive expressly agrees that, during the Restriction  Period, provided that there shall not have occurred and be continuing any material non- compliance by the Company with its obligations under this Agreement, Executive shall not, in  the United States, Canada and Mexico, directly or indirectly, as an owner, officer, director,  employee, agent, advisor, financier, or in any other form or capacity, on behalf of Executive or  any other person, firm or other business entity, engage in or be concerned with any Competitive  Products, Systems and Services, or any other duties or pursuits for monetary gain which interfere  with or restrict Executive’s activities on behalf of the Lawson Entities or constitute competition  with the business of the Lawson Entities as conducted or proposed to be conducted during the  term of this Agreement or, with respect to applicable periods following Executive’s termination,  as conducted or proposed to be conducted as of the date of Executive’s termination.  The  foregoing notwithstanding, nothing herein contained shall be deemed to prevent Executive from  investing Executive’s money in the capital stock or other securities of any corporation whose  stock or securities are publicly-owned or are regularly traded on any public exchange, provided  that Executive does not own more than a one percent (1%) interest therein.  (b) Confidentiality.  Executive hereby acknowledges that, during the course of  Executive’s employment, Executive has and will learn or develop Confidential Information in  trust and confidence.  Executive agrees to use the Confidential Information solely for the purpose  of performing Executive’s duties on behalf of the Lawson Entities and not for Executive’s own  private use or commercial purposes.  Executive acknowledges that unauthorized disclosure or  use of Confidential Information, other than in discharge of Executive’s duties, will cause the  Lawson Entities irreparable harm.  Executive shall maintain Confidential Information in strict  confidence at all times and shall not divulge Confidential Information to any Unauthorized  Person or Entity, or use in any manner, or knowingly allow another to use, any Confidential  Information, without the Company’s prior written consent, during the term of employment or  thereafter, for as long as such Confidential Information remains confidential.  Executive further  acknowledges that the Lawson Entities operate and compete internationally and that the Lawson  Entities will be harmed by the unauthorized disclosure or use of Confidential Information  regardless of where such disclosure or use occurs, and that therefore this confidentiality  agreement is not limited to any single state or other jurisdiction.  Nothing in this Agreement shall  be construed to prohibit Executive from reporting possible violations of law or regulation to any  governmental agency or entity, including but not limited to the Department of Justice, the  Securities and Exchange Commission and any agency inspector general, or making other  disclosures that are protected under the whistleblower provisions of law or regulation.  

 

    (c) Non-Solicitation.  During the Restriction Period, provided that there shall  not have occurred and be continuing any material non-compliance by the Company with its  obligations under this Agreement, Executive shall not, directly or indirectly, for himself or on  behalf of any person, firm, or other entity, solicit, induce or encourage any person to leave  her/his employment, agency or office with the Lawson Entities.  During the Restriction Period,  provided that there shall not have occurred and be continuing any material non-compliance by  the Company with its obligations under this Agreement, Executive shall not, directly or  indirectly, for Executive or on behalf of any person, firm or other entity, hire or retain or  participate in hiring or retaining any person who then is an employee of or agent for the Lawson  Entities or any person who has been an employee of or agent for the Lawson Entities at any time  in the ninety (90) days prior to termination of Executive’s employment, unless the Company is  informed and gives its approval in writing prior to the hiring or retention.  Given Executive’s office and Executive’s participation in the development, sales,  marketing, servicing and provision of the Lawson Entities’ Products, Systems and Services,  Executive acknowledges that Executive has and will learn or develop Confidential Information  relating to the development, sales, marketing, servicing or provision of the Lawson Entities’  Products, Systems and Services, and the Lawson Entities’ customers and prospective customers.   Executive further acknowledges that the Lawson Entities’ relationships with its customers have  substantial value to the Lawson Entities.  Therefore, during the Restriction Period, provided that  there shall not have occurred and be continuing any material non-compliance by the Company  with its obligations under this Agreement, Executive shall not, directly or indirectly, for  Executive or on behalf of any person, firm, or other entity, solicit or sell, attempt to sell, or  supervise, participate in, or assist the sale or solicitation of Competitive Products and Systems to  any person, firm or other entity to which the Lawson Entities sold any of the Lawson Entities’  Products, Systems and Services during the last two (2) years of Executive’s employment with the  Company prior to the effective date of termination.  However, this Section 4(c) shall not prohibit  the solicitation of any actual or potential customer of the Lawson Entities which does not fall  within the preceding description.  This Section 4(c) is independent of the obligations of  confidentiality under this Agreement and the non-compete provisions of this Agreement.  (d) Return of Property.  All notes, lists, reports, sketches, plans, data  contained in computer hardware or software, memoranda or other documents concerning or  related to the Lawson Entities’ business which are or were created, developed, generated or held  by Executive during employment, whether containing or relating to Confidential Information or  not, are the property of the Lawson Entities and shall be promptly delivered to the Company  upon termination of Executive’s employment for any reason whatsoever.  During the course of  employment, Executive shall not remove any of the above property, including but not limited to,  Confidential Information, or reproductions or copies thereof, or any apparatus containing any  such property or Confidential Information, from the Company’s premises without prior written  authorization from the Company, other than in the normal execution of Executive’s duties.  (e) Assignment of Intellectual Property Rights.  Executive agrees to assign to  the Company any and all intellectual property rights including patents, trademarks, copyrights  and business plans or systems developed, authored or conceived by Executive, whether alone or  jointly, while employed by and relating to the business of the Lawson Entities.  Executive agrees  to cooperate with the Company to perfect ownership rights thereof in the Company.  This  

 

    agreement does not apply to an invention for which no equipment, supplies, facility or  Confidential Information was used and which was developed entirely on Executive’s own time,  unless:  (1) the invention relates to the business of the Lawson Entities or to actual or anticipated  research or development of the Lawson Entities; or (2) the invention results from any work  performed by Executive for the Lawson Entities.  (f) Unfair Trade Practices.  During the term of this Agreement and at all times  thereafter, Executive shall not, directly or indirectly, engage in or assist others in engaging in any  unfair trade practices with respect to the Lawson Entities.  (g) Remedies.  Executive acknowledges that failure to comply with the terms  of this Section 4 will cause irreparable loss and damage to Company.  Therefore, Executive  agrees that, in addition and cumulative to any other remedies at law or equity available to the  Company for Executive’s breach or threatened breach of this Agreement, the Company is entitled  to specific performance or injunctive relief against Executive to prevent such damage or breach,  and a temporary restraining order and preliminary injunction may be granted to the Company for  this purpose immediately at its request upon commencement of any suit, without prior notice and  without posting any bond.  The existence of any claim or cause of action Executive may have  against the Company will not constitute a defense thereto.  In addition, the Company will be  relieved of any obligation to provide to Executive any and all termination payments and benefits  (excepting Accrued Compensation) which would otherwise occur, be continued, or become due  and payable under this Agreement following such breach or threatened breach, except that such  payments and benefits shall accrue during the period of alleged threatened breach or alleged  breach and shall be due and payable to Executive immediately upon either (a) a determination by  the Company or arbitrator or court, or (b) agreement of the parties, that Executive was not in  breach.  Each party agrees that all remedies expressly provided for in this Agreement are  cumulative of any and all other remedies now existing at law or in equity.  In addition to the  remedies provided in this Agreement, the parties will be entitled to avail themselves of all such  other remedies as may now or hereafter exist at law or in equity for compensation, and for the  specific enforcement of the covenants contained in this Agreement.  Resort to any remedy  provided for in this Section 4 or provided for by law will not prevent the concurrent or  subsequent employment of any other appropriate remedy or remedies, or preclude a recovery of  monetary damages and compensation.  Each party agrees that no party hereto shall be required to  post a bond or other security to seek an injunction.  In the event that a court of competent  jurisdiction declares that any of the remedies outlined in this Section 4(g) are unavailable as a  matter of law, the remainder of the remedies outlined in this Section 4(g) shall remain available  to the Company.  (h) Enforceability.  If any of the provisions of this Section 4 are deemed by a  court or arbitrator having jurisdiction to exceed the time, geographic area, or activity limitations  the law permits, the limitations will be reduced to the maximum permissible limitation, and  Executive and the Company authorize a court or arbitrator having jurisdiction to reform the  provisions to the maximum time, geographic area, and activity limitations the law permits;  provided, however, that such reductions apply only with respect to the operation of such  provision in the particular jurisdiction in which such adjudication is made.  

 

    (i) Sufficiency of Consideration.  Executive acknowledges that the  consideration that Executive will receive pursuant to this Agreement serves as sufficient  consideration for Executive’s promises to abide by the restrictive covenants set forth in this  Section 4.  5. Governing Law and Disputes.  (a) This Agreement shall be interpreted and enforced in accordance with the  laws of the State of Illinois, without regard to its conflict of law principles.  (b) The Company and Executive agree to attempt to resolve any dispute  between them related to this Agreement quickly and fairly, and in good faith.  Should such a  dispute remain unresolved, the Company and Executive irrevocably and unconditionally agree to  submit to the exclusive jurisdiction of the courts of the State of Illinois and of the United States  located in Chicago, Illinois over any suit, action or proceeding arising out of or relating to this  Agreement.  The Company and Executive irrevocably and unconditionally agree to personal  jurisdiction and venue of any such suit, action or proceeding in the courts of the State of Illinois  or of the United States located in Chicago, Illinois.  6. Cooperation After Termination of Employment.  Following termination of  Executive’s employment, regardless of the reason for termination, Executive will reasonably  cooperate with the Company and Parent in the prosecution or defense of any claims,  controversies, suits, arbitrations or proceedings involving events occurring prior to the  termination of employment.  Executive acknowledges that in light of Executive’s position with  the Company, Executive is in the possession of Confidential Information that may be privileged  under the attorney-client and/or work product privileges.  Executive agrees to maintain the  confidences and privileges of the Company and Parent and acknowledges that any such  confidences and privileges belong solely to the Company and Parent and can only be waived by  the Company or Parent, as applicable, not Executive.  In the event Executive is subpoenaed to  testify or otherwise requested to provide information in any matter, including without limitation,  any court action, administrative proceeding or government audit or investigation, relating to the  Company or Parent, Executive agrees that:  (a) he will promptly notify the Company and Parent  of any subpoena, summons or other request to testify or to provide information of any kind no  later than three (3) days after receipt of such subpoena, summons or request and, in any event,  prior to the date set for him to provide such testimony or information; (b) he will cooperate with  the Company and Parent with respect to such subpoena, summons or request for information; (c)  he will not voluntarily provide any testimony or information without permission of the Company  unless otherwise required by law; and (d) he will permit the Company to be represented by an  attorney of the Company’s choosing at any such testimony or with respect to any such  information to be provided, and will follow the instructions of the attorney designated by the  Company with respect to whether testimony or information is privileged by the attorney-client  and/or work product privileges of the Company or Parent, unless otherwise required by law.  The  parties agree that the Company shall be responsible for all reasonable expenses of Executive  incurred in connection with the fulfillment of Executive’s obligations under this Section 6.  The  parties agree and acknowledge that nothing in this Section 6 is meant to preclude Executive from  fully and truthfully cooperating with any government investigation.  

 

    7. Miscellaneous.  (a) Superseding Effect.  The Agreement supersedes all prior or  contemporaneous negotiations, commitments, agreements, and writings, and expresses the entire  agreement between the parties with respect to the payment of benefits upon a termination of  Executive’s employment with the Company within one year following a Change in Control;  provided, however, that the terms of any Benefit Plans will remain applicable to the particular  Benefit Plan, except as expressly modified herein.  All such other negotiations, commitments,  agreements and writings will have no further force or effect, and the parties to any such other  negotiation, commitment, agreement or writing will have no further rights or obligations  thereunder.  The parties agree and acknowledge that the definitions of terms applicable to this  Agreement may be different than the definitions of those same terms in Benefit Plans and may  result in seemingly contradictory results.  The parties agree and acknowledge that such  seemingly contradictory results are intended, and that this Agreement shall be governed solely by  the terms and definitions set forth herein and that the Benefit Plans shall be governed solely by  the terms and definitions set forth in the Benefit Plans, except as expressly modified herein.  (b) Amendment and Modification.  Except as provided in Section 7(c), neither  Executive nor the Company may modify, amend, or waive the terms of this Agreement other  than by a written instrument signed by Executive and the Company.  Either party’s waiver of the  other party’s compliance with any specific provision of this Agreement is not a waiver of any  other provision of this Agreement or of any subsequent breach by such party of a provision of  this Agreement.  No delay on the part of any party in exercising any right, power or privilege  hereunder will operate as a waiver thereof,  (c) Section 409A.  It is also the intention of this Agreement that all income tax  liability on payments made pursuant to this Agreement or any Benefit Plans be deferred until  Executive actually receives such payment to the extent Code Section 409A applies to such  payments, and this Agreement shall be interpreted in a manner consistent with this intent.   Therefore, if any provision of this Agreement or any Benefit Plans is found not to be in  compliance with any applicable requirements of Code Section 409A, that provision will be  deemed amended and will be construed and administered, insofar as possible, so that this  Agreement and any Benefit Plans, to the extent permitted by law and deemed advisable by the  Company, do not trigger taxes and other penalties under Code Section 409A; provided, however,  that Executive will not be required to forfeit any payment otherwise due without Executive’s  consent.  In the event that, despite the parties’ intentions, any amount hereunder becomes taxable  prior to the date that it would otherwise be paid, the Company shall pay to the Executive (which  payment may be made in whole or in part by way of direct remittance to appropriate tax  authorities) the portion of such amount needed to pay applicable income and excise taxes and  any interest or other penalties on such amounts.  Any remaining portion of such amount shall be  paid to Executive at the time otherwise specified in this Agreement, subject to Section 3(b).    Solely for purposes of determining the time and form of payments due under this  Agreement or otherwise in connection with his termination of employment with the Company  and that are subject to Code Section 409A, Executive shall not be deemed to have incurred a  termination of employment unless and until he shall incur a “separation from service” within the  meaning of Code Section 409A.  It is intended that each payment or installment of a payment  

 

    and each benefit provided under this Agreement shall be treated as a separate “payment” for  purposes of Code Section 409A.  All reimbursements and in-kind benefits provided under the  Agreement shall be made or provided in accordance with the requirements of Code Section 409A  to the extent that such reimbursements or in-kind benefits are subject to Code Section 409A,  including, where applicable, the requirements that (i) any reimbursement is for expenses incurred  during Executive’s lifetime (or during a shorter period of time specified in this Agreement), (ii)  the amount of expenses eligible for reimbursement during a calendar year may not affect the  expenses eligible for reimbursement in any other calendar year (except that a plan providing  medical or health benefits may impose a generally applicable limit on the amount that may be  reimbursed or paid), (iii) the reimbursement of an eligible expense will be made on or before the  last day of the calendar year following the year in which the expense is incurred and (iv) the right  to reimbursement is not subject to set off or liquidation or exchange for any other benefit.  Nothing in this Section 7(c) increases the Company’s obligations to Executive under this  Agreement or any Benefit Plans.  Executive remains solely liable for any taxes, including but not  limited to any penalties or interest due to Code Section 409A or otherwise, on the payments  made hereunder or under any Benefit Plans.  The preceding provisions shall not be construed as a  guarantee by the Company of any particular tax effect for payments made pursuant to this  Agreement or any Benefit Plans.  (d) Parachute Payments.  Notwithstanding anything to the contrary herein or  in any Benefit Plan, in the event it shall be determined that any monetary amounts or benefits  due or payable by the Company to Executive (whether paid or payable, or due or distributed) are  or will become subject to any excise tax under Section 4999 of the Code (collectively “Excise  Taxes”), then the amounts or benefits otherwise due or payable to Executive pursuant to this  Agreement or any Benefit Plans shall be reduced to the extent necessary so that no portion of  such amounts or benefits shall be subject to the Excise Taxes, but only if (i) the net amount of  such amounts and benefits, as so reduced (and after the imposition of the total amount of taxes  under federal, state and local law on such amounts and benefits), is greater than (ii) the excess of  (A) the net amount of such amounts and benefits, without reduction (but after imposition of the  total amount of taxes under federal, state and local law) over (B) the amount of Excise Taxes to  which Executive would be subject on such unreduced amounts and benefits.  If it is determined that Excise Taxes will or might be imposed on Executive in the  absence of such reduction, the Company and Executive shall make good faith efforts to seek to  identify and pursue reasonable action to avoid or reduce the amount of Excise Taxes; provided,  however, that this sentence shall not be construed to require Executive to accept any further  reduction in the amount or benefits that would be payable to him in the absence of this sentence.   The provisions of this Section 7(d) shall override and control any inconsistent provision in any  applicable Benefit Plan.  All determinations required to be made under this Section 7(d), including whether  reduction is required, the amount of such reduction and the assumptions to be utilized in arriving  at such determination, shall be made in good faith by an independent accounting firm selected by  the Company in accordance with applicable law (the “Accounting Firm”), in consultation with  tax counsel reasonably acceptable to Executive.  All fees and expenses of the Accounting Firm  shall be borne solely by the Company.  If the Accounting Firm determines that no excise tax  

 

    under Section 4999 of the Code is payable by Executive, the Company shall request that the  Accounting Firm furnish Executive with written guidance that failure to report such excise tax on  Executive’s applicable federal income tax return would not result in the imposition of a  negligence or similar penalty.  (e) Withholding.  The Company will reduce its compensatory payments to  Executive hereunder for withholding and FICA and Medicare taxes and any other withholdings  and contributions required by law.  (f) Severability.  If the final determination of an arbitrator or a court of  competent jurisdiction declares, after the expiration of the time within which judicial review (if  permitted) of such determination may be perfected, that any term or provision of this Agreement  is invalid or unenforceable, the remaining terms and provisions will be unimpaired, and the  invalid or unenforceable term or provision will be deemed replaced by a term or provision that is  valid and enforceable and that comes closest to expressing the intention of the invalid or  unenforceable term or provision.  Any prohibition or finding of unenforceability as to any  provision of this Agreement in any one jurisdiction will not invalidate or render unenforceable  such provision in any other jurisdiction.   (g) Legal Fees.  Each of the Company and Executive will bear its own  expenses in connection with the negotiation of this Agreement and the resolution of any disputes  hereunder.  (h) Binding Agreement; Assignment.  The Agreement is binding upon and  shall inure to the benefit of Executive’s heirs, executors, administrators or other legal  representatives, upon the successors of the Company and upon any entity into which the  Company merges or consolidates.  The Company shall assign or otherwise transfer this  Agreement and all of its rights, duties, obligations, or interests under it or to any successor to all  or substantially all of its assets.  Upon such assignment or transfer, any such successor will be  deemed to be substituted for the Company for all purposes.  Executive may not assign or  delegate the obligations of Executive under this Agreement.  (i) Interpretation.  This Agreement will be interpreted without reference to  any rule or precept of law that states that any ambiguity in a document be construed against the  drafter.  (j) Executive Acknowledgment.  Executive acknowledges that Executive has  read and understands this Agreement and is entering into this Agreement knowingly and  voluntarily.  (k) Continuing Obligations.  Notwithstanding the termination of Executive’s  employment hereunder for any reason or anything in this Agreement to the contrary, all post- employment rights and obligations of the parties, including but not limited to those set forth in  Sections 3, 4, 5 and 6, and any provisions necessary to interpret or enforce those rights and  obligations under any provision of this Agreement, will survive the termination or expiration of  this Agreement and remain in full force and effect for the applicable periods.  

 

    (l) Descriptive Headings.  The descriptive headings of this Agreement are  inserted for convenience only and do not constitute a part of this Agreement.  (m) Counterparts.  This Agreement may be executed in two or more  counterparts, each of which shall be deemed an original, but all of which together shall constitute  one and the same instrument.  (n) Notice.  Any notice by any party to the other party must be mailed by  registered or certified mail, postage prepaid, to the address specified below, or to any change of  address indicated by either party upon receipt of written notice of same:  First Last  Address  City, State Zip Code      Lawson Products, Inc.   8770 W. Bryn Mawr Avenue  Suite 900   Chicago, IL 60631  Attention:  General Counsel  Notice will be deemed received on the third business day following the day on which it was  mailed, postage prepaid.  [SIGNATURE LINES ON NEXT PAGE]  

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first  written above.  EXECUTIVE:           NAME      LAWSON PRODUCTS, INC.    By            Michael G. DeCata       President and Chief Executive Officer  

 

    EXHIBIT A    CONFIDENTIAL GENERAL RELEASE   In consideration of the payments and other benefits set forth in Section 3 of the Change in  Control Agreement (hereinafter the “Agreement”) made and entered into by and between  [Executive] (hereinafter the “Executive”) and Lawson Products, Inc. (hereinafter the  “Employer”) on __________ __, 2015, Executive hereby executes this Confidential General  Release (hereinafter the “Release”):   1. Executive hereby releases Employer, its past and present parents, subsidiaries,  affiliates, predecessors, successors, assigns, related companies, entities or divisions, its or their  past and present employee benefit plans, trustees, fiduciaries and administrators, and any and all  of its and their respective past and present officers, directors, partners, insurers, agents,  representatives, attorneys and employees (all collectively included in the term the “Employer”  for purposes of this release), from any and all claims, demands or causes of action which  Executive, or Executive’s heirs, executors, administrators, agents, attorneys, representatives or  assigns  (all collectively included in the term “Executive” for purposes of this release), have, had  or may have against Employer, based on any events or circumstances arising or occurring prior  to and including the date of Executive’s execution of this Release to the fullest extent permitted  by law, regardless of whether such claims are now known or are later discovered, including but  not limited to any claims relating to Executive’s employment or termination of employment by  Employer, any rights of continued employment, reinstatement or reemployment by Employer,  and any costs or attorneys’ fees incurred by Executive (collectively, the “Released Claims”);  provided, however, Executive is not waiving, releasing or giving up any rights Executive may  have to workers’ compensation benefits, to vested benefits under any pension or savings plan, to  payment of earned and accrued but unused vacation pay, to continued benefits in accordance  with the Consolidated Omnibus Budget Reconciliation Act of 1985, to unemployment insurance,  to any vested Equity Awards, to any vested awards or benefits under any Benefit Plan, to  indemnification provided by applicable law, the certificate of incorporation or bylaws of Parent  to the extent applicable, the articles of incorporation or bylaws of Employer or the  Indemnification Agreement dated as of   , 20__ between [Parent/Employer] and  Executive, each as they exist on the date of Executive’s termination, or to enforce the terms of  the Agreement, or any other right which cannot be waived as a matter of law.  In the event any  claim or suit is filed on Executive’s behalf with respect to a Released Claim, Executive waives  any and all rights to receive monetary damages or injunctive relief in favor of Executive.     2. Executive agrees and acknowledges: that this Release is intended to be a general  release that extinguishes all Released Claims by Executive against Employer; that Executive is  waiving any claims arising under Title VII of the Civil Rights Act of 1964, the Civil Rights Act  of 1991, the Americans With Disabilities Act, the Age Discrimination in Employment Act, the  Employee Retirement Income Security Act, the Family and Medical Leave Act, the  Rehabilitation Act, the Illinois Human Rights Act, and all other federal, state and local statutes,  ordinances and common law, including but not limited to any and all claims alleging personal  injury, emotional distress or other torts, to the fullest extent permitted by law; that Executive is  waiving all Released Claims against Employer, known or unknown, arising or occurring prior to  and including the date of Executive’s execution of this Release; that the consideration that  

 

    Executive will receive in exchange for Executive’s waiver of the Released Claims exceeds  anything of value to which Executive is already entitled; that Executive has entered into this  Release knowingly and voluntarily with full understanding of its terms and after having had the  opportunity to seek and receive advice from counsel of Executive’s choosing; and that Executive  has had a reasonable period of time within which to consider this Release.  Executive represents  that Executive has not assigned any claim against Employer to any person or entity.  Executive  agrees not to apply for or seek employment with Employer.     3. Executive agrees to keep the terms of this Release confidential and not to disclose  the terms of this Release to anyone except to Executive’s spouse, attorneys, tax consultants or as  otherwise required by law, and agrees to take all steps necessary to assure confidentiality by  those recipients of this information.       4. Executive hereby agrees and acknowledges that Executive has carefully read this  Release, fully understands what this Release means, and is signing this Release knowingly and  voluntarily, that no other promises or agreements have been made to Executive other than those  set forth in the Agreement or this Release, and that Executive has not relied on any statement by  anyone associated with Employer that is not contained in the Agreement or this Release in  deciding to sign this Release.  5. This Release will be governed by the laws of the State of Illinois and all disputes  arising under this Release must be submitted to a court of competent jurisdiction in Chicago,  Illinois.  Capitalized terms used herein and not otherwise defined shall have the meanings  ascribed to such terms in the Agreement.  6. Executive may accept this Release by delivering an executed copy of the Release  to:  [NAME]  [ADDRESS]    on or before _______________________ [insert a date at least 21 calendar days after  Executive’s receipt of this Agreement].  7. Executive may revoke this Release within seven (7) days after it is executed by  Executive by delivering a written notice of revocation to:  [NAME]  [ADDRESS]    no later than the close of business on the seventh (7th) calendar day after this Release was signed  by Executive.  This Release will not become effective or enforceable until the eighth (8th)  calendar day after Executive signs it.  If Executive revokes this Release, Employer shall have no  obligation to provide the payments and other benefits set forth Section 3 of the Agreement.  

 

    EXECUTIVE:             Name:         Date:Document

EMPLOYMENT AGREEMENT
    THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 21st day of October, 2021 by and between the Federal Home Loan Bank of Boston (hereinafter, the “Bank”), and Timothy J. Barrett (hereinafter, “Executive”), to be effective as of the Effective Date, as defined in Section 1.
I.RECITALS
A.WHEREAS, the Bank desires to employ Executive as President and Chief Executive Officer of the Bank for a three-year period, in accordance with the terms of this Agreement; and
B.WHEREAS, Executive is willing to serve as President and Chief Executive Officer of the Bank in accordance with the terms and conditions of this Agreement; and
C.NOW THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.Effective Date. This Agreement is effective as of December 1, 2021 (the “Effective Date”).
2.Employment. Executive is hereby employed on the Effective Date as President and Chief Executive Officer of the Bank. In such capacity, Executive shall have such responsibilities generally commensurate with such position as shall be assigned to him by the Board of Directors of the Bank (the “Board”), which shall be generally consistent with the responsibilities of similarly situated executives of comparable banks in similar lines of business, though may include additional or reasonably different duties that the Board, in its discretion, deems to be important to the management or health of the Bank. In his capacity as President and Chief Executive Officer of the Bank, Executive will report directly to the Board through its designee, who initially shall be the Chairman of the Board.
3.Employment Period. Unless earlier terminated herein in accordance with Section 7 hereof, Executive’s employment shall be for a three (3) year term (the “Employment Period”), beginning on the Effective Date. Beginning on the third anniversary of the Effective Date and on each subsequent anniversary of the Effective Date, the Employment Period shall, without further action by Executive or the Bank, be extended by an additional one-year period; provided, however, that either party may, by notice to the other given not less than sixty (60) days prior to the expiration of the then-current term, cause the Employment Period to cease to extend automatically. Upon such notice, the Employment Period and this Agreement shall terminate upon the 
			
	

expiration of the then-current term, including any prior extensions, and any such notice shall include a Notice of Termination pursuant to Section 7(d). Notwithstanding the foregoing, the provisions in Sections 10, 11, and 13 through 18 hereof shall survive the expiration of the Employment Period.
4.    Extent of Service. During the Employment Period, and excluding any periods of vacation and sick leave to which Executive is entitled, Executive agrees to devote his business time, attention, skill and efforts exclusively to the faithful performance of his duties hereunder; provided, however, that it shall not be a violation of this Agreement for Executive to (i) devote reasonable periods of time to charitable and community activities (including board service), (ii) serve on corporate boards and retain any consideration earned thereby (subject to prior approval of the Governance/Government Relations Committee of the Bank’s Board of Directors), and/or (iii) manage personal business interests and investments, so long as such activities do not interfere with the performance of Executive’s duties under this Agreement. During the Employment Period, Executive agrees to conduct himself in compliance with the Bank’s Code of Ethics and Business Conduct.
5.    Location. As of the Effective Date, Executive’s principal place of business shall be at the Bank’s headquarters office in Boston, except that, consistent with the Bank’s policies, Executive will be permitted to work remotely from time to time. Executive shall be required to travel in connection with the business of the Bank as determined by the Board Chairman to be necessary and proper from time to time.
6.Compensation and Benefits.
(a)Base Salary. During the Employment Period, the Bank will pay to Executive a base salary at the rate of $870,000 (Eight Hundred Seventy Thousand Dollars) per year (the “Base Salary”), less normal withholdings, payable in equal installments as are customary under the Bank’s payroll practices from time to time. The Human Resources & Compensation Committee of the Board (the “HR&CC”) shall review the performance of the Executive at least annually, and following its review, may approve, or recommend that the Board approve, an increase in the Executive’s base salary, subject to review by the Federal Housing Finance Agency (or successor agency) (“FHFA”). Executive’s Base Salary shall not be reduced during the Employment Period, except that the Executive’s Base Salary may be reduced pari passu with the other executive officers of the Bank.
(b)Incentive, Savings and Retirement Plans. During the Employment Period, Executive shall be entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to executive officers of the Bank (“Peer Executives”) on such terms as is approved by the Board. Without limiting the foregoing, during the Employment Period, Executive will be eligible to receive 
			
	

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annual incentive awards under the Bank’s Executive Incentive Plan adopted by the Board from time to time, so long as such a plan is in effect and open to Peer Executives. Such awards will be issued by the Board, or a committee of the Board, in its sole discretion and will be based on performance criteria established from year to year by the Board or a committee of the Board. Nothing in this Agreement shall limit the ability of the Bank to amend, modify, suspend, or terminate any benefit plans, policies or programs at any time and from time to time, including the Executive Incentive Plan.
(c)Welfare Benefit Plans. During the Employment Period, Executive and Executive’s eligible dependents shall be eligible for participation in the welfare benefit plans, practices, policies and programs provided by the Bank (“Welfare Plans”) to the extent applicable generally to Peer Executives. Nothing in this Agreement shall limit the ability of the Bank to amend, modify or terminate any Welfare Plans at any time and from time to time.
(d)Expenses, Fringe Benefits, and Paid Time Off. During the Employment Period, Executive shall be entitled to expense reimbursement, fringe benefits and paid time off in accordance with the policies, practices and procedures of the Bank, as established, amended or modified by the Bank from time to time, to the extent applicable generally to Peer Executives.
(e)Auto Allowance. During the Employment Period, the Bank shall provide Executive with a Bank-owned or leased vehicle at a monthly cost (for a leased vehicle) not to exceed Nine Hundred Dollars ($900.00). The Bank will also pay for a reserved parking space for such vehicle in a garage convenient to the Bank’s headquarters (currently, the Prudential Center Garage).  
7.Termination of Employment.
(a)Death or Disability. Executive’s employment shall terminate automatically upon Executive’s death during the Employment Period. If the Bank determines in good faith that the Disability of Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), it may give to Executive written notice of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Bank shall terminate effective on the 30th day after the Executive’s receipt of such written notice (the “Disability Effective Date”), unless Executive has returned to full-time performance of Executive’s duties within 30 days following such receipt. For purposes of this Agreement, “Disability” shall mean a mental or physical disability as determined by the Board in accordance with standards and procedures similar to those under the Bank’s employee long-term disability plan, if any. At any time that the Bank does not maintain such a long-term disability plan, “Disability” shall mean the inability of Executive, as determined by the Board, to substantially perform the essential functions of his regular duties and responsibilities due to a medically determinable physical or mental condition which has lasted (or can 
			
	

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reasonably be expected to last) for 180 aggregate days (whether consecutive or not consecutive) in any twelve-month period.
(b)Termination by the Bank. The Bank may terminate Executive’s employment during the Employment Period with or without Cause.  (For the avoidance of doubt, the Bank’s termination of the Employment Period pursuant to Section 3 shall be deemed to be a termination of employment by the Bank.) 

For purposes of this Agreement, “Cause” shall mean:
(i)Executive’s continued failure to perform substantially Executive’s duties with the Bank (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to Executive by the Board which specifically identifies the manner in which the Board believes that Executive has not substantially performed Executive’s duties; or
(ii)Executive’s engaging in illegal conduct or willful misconduct which is, or is likely to be, injurious to the Bank, its financial condition, or its reputation; or
(iii)Executive’s material violation of law or regulation applicable to the Bank, or violation of the Bank’s written policies or guidelines, including, without limitation any Code of Conduct or Code of Ethics adopted by the Bank; or
(iv)Executive’s engaging in any activity or conduct that results in a written request from the FHFA or any other regulatory agency or body requesting that the Bank terminate the employment of the Executive; or
(v)Executive’s indictment for or conviction of, plea of guilty or nolo contendere with respect to, or agreement to enter into a pre-trial diversion or similar program in connection with the prosecution for, a felony of any type or any crime involving fraud, theft, misappropriation, embezzlement, dishonesty, breach of trust or money laundering or any form of moral turpitude; or
(vi)(A) The Bank’s receipt of a written notice under 12 U.S.C. Section 4636a seeking or ordering removal or suspension of the Executive, (B) the issuance of a notice of charges by the FHFA against the Executive or the Bank based upon the actions or activities of the Executive under 12 U.S.C. Section 4631, (C) the seeking of or entry of a cease and desist order by the FHFA against the Executive or the Bank relating to actions of or conduct by the Executive, or (D) the imposition of civil money penalties by the FHFA relating to action or conduct by the Executive; or
			
	

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(vii)Executive’s breach of fiduciary duty, dishonesty in the carrying out of his duties, or breach of the Restrictive Covenants set forth in Section 13 of this Agreement; or
(viii)Executive’s failure or refusal to comply with a lawful directive from the Chairman of the Board or from the Board or its designee; or
(ix)Any other action or failure to act that constitutes a material breach of this Agreement by Executive.
Notwithstanding the foregoing, in the case of any conduct described in clauses (i), (iii), (viii) or (ix) of the immediately preceding sentence, if such conduct is reasonably susceptible of being cured, then Executive’s termination shall be for “Cause” only if Executive fails to cure such conduct within ten (10) days after receiving written notice from the Bank describing such conduct in reasonable detail. If at the end of such ten (10) day period no such cure has been effected to the satisfaction of the Board or a committee thereof, as determined in good faith, then Executive’s employment shall be terminated for Cause as of the end of such ten (10) day period. The Bank shall be obligated to provide to Executive only one such notice of proposed termination. If subsequent to effecting a cure of specified deficiencies under clause (i), (iii), (viii) or (ix) above, the Board or a committee thereof determines that Executive again has committed an act of Cause under clause (i), (iii), (viii) or (ix), then Executive’s employment may be terminated immediately for Cause upon the Corporation’s giving of notice of termination to Executive.  The Bank’s continuation of Executive’s employment shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Cause hereunder.
(c)Termination by Executive. Executive’s employment may be terminated by Executive for Good Reason or for no reason. For purposes of this Agreement, “Good Reason” shall mean, without the consent of Executive:
(i)a material diminution in Executive’s Base Salary, except as permitted under Section 6(a), excluding for this purpose an isolated, insubstantial or inadvertent action that is remedied by the Bank after receipt of notice thereof given by Executive in accordance with this Section 7(c);
(ii)a material diminution in the Executive’s title or authority (including a requirement that the Executive report to a corporate officer or employee instead of reporting directly to the Board or a designee of the Board) without Executive’s consent, excluding for this purpose an isolated, insubstantial or inadvertent action that is remedied by the Bank after receipt of notice thereof given by Executive in accordance with this Section 7(c);
			
	

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(iii)  The Bank’s requiring Executive to be based at any office or location more than 50 miles from the current location of the Bank in Boston, Massachusetts, provided that such move results in a material increase in Executive’s commute time; or
(iv)any other action or failure to act that constitutes a material breach of this Agreement by the Bank that is not remedied by the Bank after receipt of notice thereof given by Executive in accordance with this Section 7(c).
Good Reason shall not include Executive’s death or Disability, or the Bank’s termination of the Employment Period pursuant to Section 3 (which shall constitute a termination of employment by the Bank). A termination by Executive shall not constitute termination for Good Reason unless Executive shall first have delivered to the Bank, within 30 days of the occurrence of the first event giving rise to Good Reason, written notice setting forth with specificity the occurrence deemed to give rise to a right to terminate for Good Reason, there shall have passed a reasonable time (not less than 30 days and not more than 60 days) within which the Bank may take action to correct, rescind or otherwise substantially reverse the occurrence supporting termination for Good Reason as identified by Executive, and the Bank fails to correct, rescind or otherwise substantially reverse such occurrence during such cure period. Executive’s separation for Good Reason must occur within 120 days following the initial occurrence of an event giving rise to Good Reason in order to be deemed a termination for Good Reason. In the event of a separation following such 120-day period, no “Good Reason” shall be deemed to exist.
(d)Notice of Termination. Any termination of this Agreement by the Bank or by Executive, other than for death or Disability, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 16(f) of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, including whether such termination is for Cause or Good Reason, (ii) if such termination is for Cause or Good Reason, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated, to the extent applicable, and (iii) specifies the termination date (which, if such termination is by the Executive, shall not be less than 30 days from receipt of the Notice). The failure by the Bank or by Executive to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Cause or of Good Reason, as the case may be, shall not waive any right of the party asserting Cause or Good Reason hereunder or preclude that party from asserting such fact or circumstance in enforcing the party’s rights hereunder, subject to the relevant cure provisions in Sections 7(b) or 7(c), respectively.
			
	

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(e)Date of Termination. “Date of Termination” means (i) if Executive’s employment is terminated other than by reason of death or Disability, the date specified in the Notice of Termination, or (ii) if Executive’s employment is terminated by reason of death or Disability, the date of death or the Disability Effective Date, as the case may be.
8.Obligations of the Bank upon Termination.
(a)Termination by the Executive for Good Reason, or by the Bank Other Than for Cause or Disability. If, during the Employment Period and prior to expiration of this Agreement, the Executive shall resign for Good Reason or the Bank shall terminate Executive’s employment other than for Cause or Disability then, subject to Section 15(d) and, with respect to the payments and benefits described in clause (ii) below, only if Executive executes a separation agreement including a general release of claims in a form acceptable to the Bank (the “Release”) and all revocation periods under such Release have expired, and only after receipt of nonobjection from the FHFA, if the Bank determines that such nonobjection is required:
(i)the Bank shall pay to Executive in a single lump sum cash payment within 60 days after the Date of Termination, the following amounts: (A) Executive’s Base Salary to the extent any remains unpaid up to and including the Date of Termination, (B) any accrued but unused vacation pay through the Date of Termination that is payable to Executive under the Bank’s standard policies, and (C) reimbursement of any expenses accrued by, but not yet reimbursed to, Executive through the Date of Termination pursuant to the Bank’s expense reimbursement policies and procedures (collectively, the “Accrued Obligations”); and
(ii)the Bank shall pay to Executive severance payments as follows: 
(A)salary continuation (at the Base Salary level in effect at the time of termination), paid pursuant to the Bank’s normal payroll schedule for a period of one (1) year; and
(B)pro rata payment of the short-term and deferred incentive opportunity, if any, for the “President” Tier under the Bank’s Executive Incentive Plan (EIP) in effect during the year of termination, calculated and payable in accordance with the terms of, and at the time provided under, such EIP as if the Executive had met all employment-related requirements for such payment as a retiree under such EIP (e.g. prior notice requirement, six months of service during the year, effective transition, recommendation by CEO and concurrence of the HR&CC), regardless of whether such employment-related requirements were actually met, with such pro rata calculation made in a manner consistent with the Bank’s practice for retirees who meet the employment-related requirements; and
			
	

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(C)payment of the Executive’s then-unpaid deferred incentive awards, if any, under the Bank’s EIPs in effect during the years prior to the year of termination, calculated and payable in accordance with the terms of, and at the time provided under, such EIPs as if the Executive had continued employment through the date on which the Bank pays deferred awards under such EIPs to its other executive officers; and
(D)an amount equal to the excess of (x) the amount Executive would have to pay to continue participation following termination of employment (under COBRA or similar post-employment health care continuation requirements) in any group medical, dental, vision and/or prescription drug benefit plan in which Executive and/or Executive’s eligible dependents are enrolled at the time of the Date of Termination, for a period of twelve (12)  months after the Date of Termination, over (y) the amount that Executive would have had to pay for such coverage if he had remained employed during such 12-month period and paid the active employee rate for such coverage (the “Healthcare Replacement Amount”), which amount shall be paid in a single lump sum cash payment within 60 days after the Date of Termination; and
(iii)to the extent not theretofore paid or provided, the Bank shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Bank, subject to the terms and conditions thereof (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).
(b)Death. If Executive’s employment is terminated by reason of Executive’s death during the Employment Period, this Agreement shall terminate without further obligations to Executive’s legal representatives under this Agreement, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 60 days of the Date of Termination. With respect to the provision of Other Benefits, the term “Other Benefits” as used in this Section 8(b) shall include, without limitation, benefits under such plans, programs, practices and policies relating to death benefits, if any, as are applicable to Executive on the date of his death.
(c)Disability. If Executive’s employment is terminated by reason of Executive’s Disability during the Employment Period, this Agreement shall terminate without further obligations to Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to Executive in a lump sum in cash within 60 days of the Date of Termination. With respect to the provision of Other Benefits, the term “Other Benefits” as used in this Section 8(c) shall include, without limitation, disability and other benefits under such 
			
	

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plans, programs, practices and policies relating to disability for which Executive may qualify, if any, as are applicable to Executive and his family on the Date of Termination.
(d)Cause or Resignation other than for Good Reason. If Executive’s employment is terminated by the Bank for Cause during the Employment Period, or by Executive other than for Good Reason, this Agreement shall terminate without further obligations to Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to Executive in a lump sum in cash within 60 days of the Date of Termination.
(e)Expiration. Neither expiration of this Agreement nor any decision or notice of intent to allow the Agreement to expire shall constitute “Good Reason” or termination other than for Cause or shall be deemed to entitle Executive to any payments or benefits pursuant to this Agreement.
9.Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit Executive’s continuing or future participation in any plan, program, policy or practice provided by the Bank and for which Executive may qualify, nor, subject to Section 18(d), shall anything herein limit or otherwise affect such rights as Executive may have under any contract or agreement with the Bank, provided that Executive may not receive severance benefits under both this Agreement and the Bank’s Executive Change in Control Severance Plan or the Bank’s general Severance Plan for employees. Amounts which are vested benefits or which Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Bank at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
10.    Limitation of Benefits.
(a)Notwithstanding anything in this Agreement to the contrary, in the event it shall be determined that any benefit, payment or distribution by the Bank to or for the benefit of Executive (whether payable or distributable pursuant to the terms of this Agreement or otherwise) (such benefits, payments or distributions are hereinafter referred to as “Payments”) would, if paid, be subject to the excise tax (the “Excise Tax”) imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), then prior to the making of any Payments to Executive, a calculation shall be made comparing (i) the net after-tax benefit to Executive of the Payments after payment by Executive of the Excise Tax, to (ii) the net after-tax benefit to Executive if the Payments had been limited to the extent necessary to avoid being subject to the Excise Tax. If the amount calculated under (i) above is less than the amount calculated under (ii) above, then the Payments shall be limited to the extent necessary to avoid being subject to the Excise Tax (the “Reduced Amount”). The reduction of the Payments, if 
			
	

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applicable, shall be made by first reducing cash Payments and then, to the extent necessary, reducing those Payments having the next highest ratio of Parachute Value (as defined below) to actual present value of such Payments as of the date of the applicable change of control, as determined by the Determination Firm (as defined in Section 10(b) below). For purposes of this Section 10, present value shall be determined in accordance with Section 280G(d)(4) of the Code. For purposes of this Section 10, the “Parachute Value” of a Payment means the present value as of the date of the applicable change of control of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2) of the Code, as determined by the Determination Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.
(b)All determinations required to be made under this Section 10, including whether an Excise Tax would otherwise be imposed, whether the Payments shall be reduced, the amount of the Reduced Amount, and the assumptions to be utilized in arriving at such determinations, shall be made by an independent certified public accounting firm selected by the Bank and reasonably acceptable to Executive (the “Determination Firm”) which shall provide detailed supporting calculations both to the Bank and Executive. All fees and expenses of the Determination Firm shall be borne solely by the Bank. Any determination by the Determination Firm shall be binding upon the Bank and Executive. 
11.Costs of Enforcement. Subject to Section 10(b), each party hereto shall pay its own costs and expenses incurred in enforcing or establishing its rights hereunder, including, without limitation, attorneys’ fees, whether suit be brought or not, and whether or not incurred in trial, bankruptcy or appellate proceedings.
12.Representations and Warranties. Executive hereby represents and warrants to the Bank that Executive is not a party to, or otherwise subject to, any covenant not to compete with any person or entity, and Executive’s execution of this Agreement and performance of his obligations hereunder will not violate the terms or conditions of any contract or obligation, written or oral, between Executive and any other person or entity.
13.Restrictions on Conduct of Executive.
(a)No Solicitation. During the Employment Period and for a period of twelve (12) months after the Date of Termination, Executive shall not, directly or indirectly:
(i)Solicit any customers of the Bank or the Bank’s affiliates for purposes of selling any products or services competitive with those of the Bank or its affiliates and with whom Executive had Material Contact in the twelve (12) months 
			
	

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preceding termination of employment. For purposes of this Agreement, Executive had “Material Contact” with a customer if (a) Executive had business dealings with the customer on the Bank’s behalf, or (b) Executive was responsible for supervising or coordinating the dealings between the customer and the Bank; or
(ii)Solicit for employment, offer, or cause to be offered, employment, either on a full time, part-time or consulting basis, to any person who was employed by the Bank or its affiliates on the Date of Termination and with whom Executive had contact during the course of his employment by the Bank, unless Executive shall have received the prior written consent of the Bank to offer employment specifically to that person.
Executive understands and agrees that the non-solicitation agreement contained in this Section 13 is reasonable and necessary to protect the legitimate interests of the Bank and its confidential information and trade secrets from unfair exploitation.
(b)Confidentiality and Nondisclosure.
(i)Confidential Information. “Confidential Information” refers to business information or data of the Bank that is not generally known to the public and that the Bank desires and makes reasonable efforts to keep confidential. Confidential Information includes, but is not limited to, concepts, ideas, customer lists, business lists, business and strategic plans, financial data, accounting procedures, models, trade secrets, computer programs and plans, information related to officers, directors, employees and agents, operations materials and memoranda, personnel records and information, pricing and financial information related to the Bank, its members, and suppliers, and any information marked “Confidential” by the Bank, and other proprietary information. Confidential Information does not include data or information that (i) the Bank has voluntarily disclosed to the public, (ii) third parties have independently developed and disclosed to the public, or (iii) otherwise enters the public domain through lawful means. This definition shall not limit any definition of “confidential information” or any equivalent term under any applicable state, local or federal law.
(ii)Non-Disclosure. Executive hereby acknowledges and agrees that the Bank and its affiliates have developed and own valuable information described above as Confidential Information. Executive acknowledges and agrees that all such Confidential Information are valuable assets of the Bank, and if developed by Executive, are developed by Executive in the course of Executive’s employment with the Bank, and are the sole property of the Bank. Executive agrees that Executive will not use for his own benefit or the benefit of anyone other than the Bank and will not divulge or otherwise disclose to any third party, directly or indirectly, any Confidential Information, except to the extent such use or disclosure is (i) required by applicable law or in response to a lawful inquiry from a governmental or regulatory authority, (ii) lawfully 
			
	

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obtainable from other sources, or (iii) authorized by the Bank. The parties acknowledge and agree that this Agreement is not intended to, and does not, alter either the Bank’s rights or Executive’s obligations under any state or federal statutory or common law regarding trade secrets or unfair trade practices. Notwithstanding anything herein or in any other agreement with or policy of the Bank to which Executive is or was subject, nothing herein or therein shall (i) prohibit Executive from making reports of possible violations of federal law or regulation to any governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or of any other whistleblower protection provisions of state or federal law or regulation, or (ii) require notification or prior approval by the Bank of any reporting described in clause (i). Furthermore, Executive shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, in each case, solely for the purpose of reporting or investigating a suspected violation of law or (ii) in a complaint or other document filed in a lawsuit or proceeding, if such filings are made under seal.
(c)Enforcement of Restrictive Covenants.
(i)Rights and Remedies Upon Breach. In the event Executive breaches, or threatens to commit a breach of, any of the provisions of the covenants contained in this Section 13 (the “Restrictive Covenants”), the Bank shall have the following rights and remedies, which shall be independent of any others and severally enforceable, and shall be in addition to, and not in lieu of, any other rights and remedies available to the Bank at law or in equity:
(A)the right and remedy to enjoin, preliminarily and permanently, Executive from violating or threatening to violate the Restrictive Covenants and to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach or threatened breach of the Restrictive Covenants would cause irreparable injury to the Bank and that money damages would not provide an adequate remedy to the Bank; and
(B)the right and remedy to require Executive to account for and pay over to the Bank all compensation, profits, monies, accruals, increments or other benefits derived or received by Executive as the result of any transactions constituting a breach of the Restrictive Covenants.
(ii)Severability of Covenants. Executive acknowledges and agrees that the Restrictive Covenants are reasonable and valid in time and scope and in all other respects. The covenants set forth in this Agreement shall be considered and construed as separate and independent covenants. Should any part or provision of any 
			
	

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covenant be held invalid, void or unenforceable in any court of competent jurisdiction, such invalidity, voidness or unenforceability shall not render invalid, void or unenforceable any other part or provision of this Agreement. If any portion of the foregoing provisions is found to be invalid or unenforceable by a court of competent jurisdiction because its duration, the territory, the definition of activities or the definition of information covered is considered to be invalid or unreasonable in scope, the invalid or unreasonable term shall be redefined, or a new enforceable term provided, such that the intent of the Bank and Executive in agreeing to the provisions of this Agreement will not be impaired and the provision in question shall be enforceable to the fullest extent of the applicable laws.
14.Assignment and Successors.
(a)This Agreement is personal to the Executive and without the prior written consent of the Bank shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b)This Agreement shall inure to the benefit of and be binding upon the Bank and its successors and assigns.
(c)The Bank will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Bank to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Bank would be required to perform it if no such succession had taken place. As used in this Agreement, “Bank” shall mean the Bank as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.
15.Code Section 409A.
(a)General. This Agreement shall be interpreted and administered in a manner so that any amount or benefit payable hereunder shall be paid or provided in a manner that is either exempt from or compliant with the requirements Section 409A of the Code and applicable Internal Revenue Service guidance and Treasury Regulations issued thereunder (and any applicable transition relief under Section 409A of the Code). Nevertheless, the tax treatment of the benefits provided under the Agreement is not warranted or guaranteed. Neither the Bank nor its directors, officers, employees or advisers (other than Executive, in his capacity as the taxpayer) shall be held liable for any taxes, interest, penalties or other monetary amounts owed by Executive as a result of the application of Section 409A of the Code.
			
	

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(b)Definitional Restrictions. Notwithstanding anything in this Agreement to the contrary, to the extent that any amount or benefit that would constitute non-exempt “deferred compensation” for purposes of Section 409A of the Code (“Non-Exempt Deferred Compensation”) would otherwise be payable or distributable hereunder, or a different form of payment of such Non-Exempt Deferred Compensation would be effected, by reason of the Executive’s Disability or termination of employment, such Non-Exempt Deferred Compensation will not be payable or distributable to the Executive, and/or such different form of payment will not be effected, by reason of such circumstance unless the circumstances giving rise to such Disability or termination of employment, as the case may be, meet any description or definition of “disability” or “separation from service,” as the case may be, in Section 409A of the Code and applicable regulations (without giving effect to any elective provisions that may be available under such definition). This provision does not prohibit the vesting of any Non-Exempt Deferred Compensation upon Disability or termination of employment, however defined. If this provision prevents the payment or distribution of any Non-Exempt Deferred Compensation, such payment or distribution shall be made on the date, if any, on which an event occurs that constitutes a Section 409A-compliant “disability” or “separation from service,” as the case may be, or such later date as may be required by subsection (d) below. If this provision prevents the application of a different form of payment of any amount or benefit, such payment shall be made in the same form as would have applied absent such designated event or circumstance.
(c)Treatment of Installment Payments. Each payment of termination benefits under Section 8 of this Agreement constituting Non-Exempt Deferred Compensation shall be considered a separate payment, as described in Treas. Reg. Section 1.409A-2(b)(2), for purposes of Section 409A of the Code.
(d)Timing of Release of Claims. Whenever in this Agreement a payment or benefit is conditioned on Executive’s execution and non-revocation of a release of claims, such release must be executed and returned to the Bank, and all revocation periods must have expired without exercise, within 60 days after the Date of Termination, failing which such payment or benefit shall be forfeited. The Company may elect to commence payment or provision of the benefit at any time during such sixty (60)-day period; provided, however, that if such sixty (60)-day period begins in one taxable year and ends in the following taxable year, then the Company shall commence payment in the second taxable year. If such payment or benefit is exempt from Section 409A of the Code, the Company may elect to make or commence payment at any time during such sixty (60)-day period.
(e)Timing of Reimbursements and In-kind Benefits. If Executive is entitled to be paid or reimbursed for any taxable expenses under Section 6(d), and such payments or reimbursements are includible in Executive’s federal gross taxable income, 
			
	

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the amount of such expenses reimbursable in any one calendar year shall not affect the amount reimbursable in any other calendar year, and the reimbursement of an eligible expense must be made no later than December 31 of the year after the year in which the expense was incurred. No right of Executive to reimbursement of expenses under Section 6(d) shall be subject to liquidation or exchange for another benefit.
16.Return of Property. The Executive agrees to deliver to the Bank upon the termination of the Executive’s employment, and at any other time upon the Bank's request: (a) all documents and other materials, whether made or compiled by the Executive alone or with others, or made available to the Executive while employed by the Bank, pertaining to Confidential Information or other inventions and works of the Bank; (b) all Confidential Information, other inventions, or any other property of the Bank in the Executive's possession, custody, or control, and (c) all cellular telephones, tablets, laptops, and data storage devices paid for or issued by the Bank or otherwise containing Confidential Information.
17.Future Cooperation and Assistance.
(a)Cooperation in Future Matters. The Executive hereby agrees that, for a period of two (2) years following his date of termination, he shall cooperate with the Bank’s reasonable requests relating to matters that pertain to the Executive’s employment by the Bank, including, without limitation, providing information or limited consultation as to such matters, participating in legal proceedings, investigations, or audits on behalf of the Bank, or otherwise making himself reasonably available to the Bank for other related purposes. Any such cooperation shall be performed at times scheduled to take into consideration the Executive’s other commitments, and the Executive shall be compensated at a reasonable hourly or per diem rate to be agreed upon by the Parties to the extent such cooperation is required on more than an occasional and limited basis. The Executive shall also be reimbursed for all reasonable out-of-pocket expenses. The Executive shall not be required to perform such cooperation to the extent it conflicts with any requirements of exclusivity of service for another employer, or otherwise, nor in any manner that, in the good-faith belief of the Executive, would conflict with his rights under or ability to enforce this Agreement.
(b)Assistance with Claims. The Executive agrees that, for the period beginning on the Effective Date, and continuing for a reasonable period after the Executive’s date of termination, the Executive shall assist the Bank in defense of any claims that may be made against the Bank, and shall assist the Bank in the prosecution of any claims that may be made by the Bank, to the extent that such claims may relate to services performed by the Executive for the Bank. The Executive agrees to promptly inform the Bank if he becomes aware of any lawsuits involving such claims that may be filed against the Bank. The Bank agrees to provide legal counsel to the Executive in connection with such assistance (to the extent legally permitted), and to reimburse the Executive for all of the Executive’s reasonable out-of-pocket expenses associated with 
			
	

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such assistance, including travel expenses. For periods after the Executive’s employment with the Bank terminates, the Executive shall be compensated for such assistance at a reasonable hourly or per diem rate to be agreed upon by the Parties. The Executive also agrees to promptly inform the Bank if he is asked to assist in any investigation of the Bank (or its actions) that may relate to services performed by the Executive for the Bank, regardless of whether a lawsuit has then been filed against the Bank with respect to such investigation, unless the Executive is prohibited by law or legal process from so informing the Bank.

18. Miscellaneous.
(a)Waiver. Failure of either party to insist, in one or more instances, on performance by the other in strict accordance with the terms and conditions of this Agreement shall not be deemed a waiver or relinquishment of ay right granted in this Agreement or of the future performance of any such term or condition or of any other term or condition of this Agreement, unless such waiver is contained in a writing signed by the party making the waiver.
(b)Severability. If any provision or covenant, or any part thereof, of this Agreement should be held by any court to be invalid, illegal or unenforceable, either in whole or in part, such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of the remaining provisions or covenants, or any part thereof, of this Agreement, all of which shall remain in full force and effect.
(c)Publicity; Nondisparagement.  Neither Party shall issue, without consent of the other Party, any press release or make any public announcement with respect to this Agreement or the employment relationship between them. Following the Effective Date of this Agreement, and regardless of any dispute that may arise in the future, the Executive and the Bank jointly and mutually agree that they shall not disparage, criticize, or make statements that are negative, detrimental, or injurious to the other to any individual or company, including within the Bank; provided that this paragraph shall not prohibit either Party from offering truthful testimony or evidence in any legal proceeding in which the Party is compelled to appear.
(d)Other Agents. Nothing in this Agreement is to be interpreted as limiting the Bank from employing other personnel on such terms and conditions as may be satisfactory to it.
(e)Entire Agreement. Except as provided herein, this Agreement contains the entire agreement between the Bank and Executive with respect to the subject matter hereof and, from and after the Effective Date, this Agreement shall supersede any other agreement between the parties with respect to the subject matter 
			
	

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hereof, including without limitation, any written or oral discussions, term sheets, or agreements prior to the Effective Date.
(f)Governing Law. Except to the extent preempted by federal law, and without regard to conflict of laws principles, the laws of the Commonwealth of Massachusetts shall govern this Agreement in all respects, whether as to its validity, construction, capacity, performance or otherwise.
(g)Notices. All notices, requests, demands and other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, or three days after mailing if mailed, first class, certified mail, postage prepaid:
To Bank:    
Chairman of the Board (cc: General Counsel)
Federal Home Loan Bank of Boston
800 Boylston Street
Boston, MA 02199
To Executive:
Timothy J. Barrett    
At the most recent address on file with the Bank

Any party may change the address to which notices, requests, demands and other communications shall be delivered or mailed by giving notice thereof to the other party in the same manner provided herein.
(h)Amendments and Modifications. This Agreement may be amended or modified only by a writing signed by both parties hereto, which makes specific reference to this Agreement.
(i)Construction. Each party and his or its counsel have reviewed this Agreement and have been provided the opportunity to revise this Agreement and accordingly, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement. Instead, the language of all parts of this Agreement shall be construed as a whole, and according to its fair meaning, and not strictly for or against either party.
(j)Regulatory Authority. Benefits under this Agreement shall not be in an amount that would be prohibited under 12 CFR §1231.3(a) unless the Bank has received the approval of the Director of the FHFA. Notwithstanding any other provision of this Agreement, the Bank and the Executive each acknowledge and agree that payments to be made by the Bank that are contingent on, or by their terms are payable on or after, the termination of the Executive’s employment or affiliation with the Bank, 
			
	

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may be limited or precluded by the FHFA under authorities granted it under applicable law and the Bank may comply with such limitation or preclusion without breaching this Agreement or incurring any other liability to Executive. In the event that the FHFA objects to any amount payable hereunder, but agrees to not to object to a lower amount, then the amount set forth in this Agreement shall be deemed to be revised to such lower amount. If the FHFA objects to a category of payment being made at all, then the payment objected to by the FHFA shall be deemed to be excised from this Agreement and the obligation to make the payment shall be null and void. The FHFA’s objection to any payment or amount provided in this Agreement shall not affect the validity or enforceability of any other portion of this Agreement.
(k)No Duplication. In the event that Executive becomes entitled to receive severance benefits under this Agreement and may also be eligible for severance benefits under any other Bank plan, program, arrangement or agreement as a result of his termination of employment, the Executive shall be entitled to receive the greater of the severance payments available under this Agreement, on the one hand, and the benefits available under such other Bank plan, program, arrangement or agreement, on the other, but not both. 
    IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Employment Agreement as of the date first above written.
FEDERAL HOME LOAN BANK OF BOSTON

By:  /s/ Martin J. Geitz      
Name: Martin J. Geitz
Title: Chairman of the Board

EXECUTIVE:

   /s/ Timothy J. Barrett    
Name: Timothy J. Barrett
			
	

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