Document:

Exhibit

Exhibit 10.1

RETENTION PAYMENT AGREEMENT
This RETENTION PAYMENT AGREEMENT (“Agreement”), effective as of May 12, 2016 (“Effective Date”), is entered into by and among the Federal Home Loan Bank of San Francisco (the “Bank”) and Dean Schultz (“Mr. Schultz”).
WHEREAS, Mr. Schultz has served as President and Chief Executive Officer (“CEO”) of the Bank since 1991 and plans to retire on May 31, 2016 (“Retirement Date”); 
WHEREAS, Mr. Schultz’s successor will commence employment with the Bank as President and CEO on May 12, 2016, prior to Mr. Schultz’s retirement;
WHEREAS, in recognition of the importance of Mr. Schultz’s leadership and guidance of the Bank during a lengthy search for and transition to his successor, the Bank’s Board of Directors desires to continue to employ Mr. Schultz as a non-executive employee during the Bank’s transition to a successor President and CEO and to enter into an agreement embodying the terms of such employment;
WHEREAS, Mr. Schultz desires to assist in the transition, subject to the terms and conditions of this Agreement;
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1.    Position and Duties.  As of the Effective Date, Mr. Schultz will be employed as a non-executive employee of the Bank with the responsibility to assist in the transition of President and CEO duties to his successor.  Mr. Schultz shall report to the Board of Directors (“Board”) and shall perform such duties as the Board or the successor President and CEO reasonably direct.  Mr. Schultz will devote his best efforts and substantially all his business time and attention to the performance of his duties with the Bank  under this Agreement.
2.    Term.  Mr. Schultz’s appointment and service as President and CEO will end on  May 12, 2016, the date the successor President and CEO of the Bank commences employment with the Bank. From May 12, 2016 until his retirement on May 31, 2016, Mr. Schultz will be employed as a non-executive employee of the Bank. Notwithstanding the foregoing, Mr. Schultz’ employment is “at will” by law and may be terminated at any time, including at any time, without cause by either party on written notice (“Termination”).  No other prior or subsequent oral representations, writings, or course of conduct by anybody at the Bank may alter the “at-will” nature of the employment relationship, and nothing in this Agreement should be construed to create any relationship other than “at-will” employment as specified herein.  The “at-will” nature of the employment relationship at all times may be modified only when permitted by applicable law and by a writing signed by both Mr. Schultz and the Bank, specifically amending this Agreement with respect to the issue of the “at-will” employment relationship.

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3.    Terms of Employment
A.    Compensation.  
(i)    Base Salary.  Nothing herein shall alter Mr. Schultz’s base salary, which shall continue at its current rate of $852,800.00 per annum (“Base Salary”), through his Retirement Date.  The Base Salary shall be subject to all applicable state and federal tax withholdings, payable in semi-monthly installments consistent with the Bank’s normal payroll process.
(ii)    Retention Payment.  The Bank shall provide Mr. Schultz with a retention payment in the amount of $150,000.00 (“Retention Payment”), which will be paid to Mr. Schultz on the Retirement Date.  The Retention Payment shall be in lieu of any and all severance, retention and other similar payments and benefits, including any that might have been available under the Bank’s Corporate Senior Officer Severance Policy, the Change in Control Severance Agreement between the Bank and Mr. Schultz dated June 1, 2011, and any other similar plans, policies, programs and agreements.  For the avoidance of doubt, except for the Retention Payment, due to his voluntarily retirement Mr. Schultz shall not be eligible to receive any severance, retention or other similar payments or benefits.
(iii)    Taxes and Withholdings.  The Bank may withhold from any amounts payable under this Agreement, including the Retention Payment, such federal, state or local taxes as may be required to be withheld pursuant to applicable law or regulations, which amounts shall be deemed to have been paid to Mr. Schultz. 
B.    Benefit Programs.  Mr. Schultz is entitled to participate in relevant benefit plans, including currently the Bank’s health benefit plans, Savings 401(k) Plan, Cash Balance Plan, Deferred Compensation Plan, Benefit Equalization Plan and Supplemental Executive Retirement Plan, provided he meets certain eligibility requirements and shares a portion of the costs, as applicable, in accordance with each such plan, as they may be in effect.  Details of such benefits are included in the Bank’s policies, benefit summaries and plan descriptions. 
C.    Incentive Plans.  Mr. Schultz acknowledges and agrees that he will not be eligible to receive any payment under the Bank’s 2016 President’s Incentive Plan because his employment with the Bank will terminate prior to January 1, 2017.  Mr. Schultz may receive prorated payments under the Bank’s 2014, 2015 and 2016 Executive Performance Unit Plans, as a result of his voluntary normal retirement, subject to and in accordance with all of the terms, conditions and limitations of such plans, including without limit the prior review and non-objection of the Federal Housing Finance Agency.
4.    Expense Reimbursement.  Mr. Schultz may submit reasonable, out-of-pocket, work-related expenses to the Bank for reimbursement, including without limitation mobile phone monthly service and usage, consistent with any policies that the Bank may then have in place regarding expense reimbursements.

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5.    Covenants.
A.    Cooperation.  Mr. Schultz hereby covenants that at any time after his Retirement Date, or any earlier Termination of his employment with the Bank, he will cooperate with the Bank to the extent reasonably necessary to assist in the transition of his responsibilities and in any litigation or administrative proceedings involving any matters with which Mr. Schultz was involved during his employment.  The Bank will reimburse Mr. Schultz for reasonable expenses, if any, incurred in providing such assistance. 
B.    Section 409A Compliance.  
(i)    Notwithstanding anything herein to the contrary, the intent of the parties is that payments and benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (“Section 409A”) and, accordingly, to the maximum extent permitted this Agreement shall be interpreted to be in compliance therewith or exempt therefrom.  The Bank shall not be liable for any additional tax, interest or penalty that may be imposed on Mr. Schultz by Section 409A or damages for failing to comply with Section 409A.  
(ii)    Termination of Mr. Schultz’s employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.”
(iii)    All expenses or other reimbursements under this Agreement that would constitute nonqualified deferred compensation subject to Section 409A, (A) shall be paid on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Mr. Schultz, (B) no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect his right to reimbursement of any other expenses eligible for reimbursement in any other taxable year, and (C) Mr. Schultz’s right to reimbursement shall not be subject to liquidation in exchange for any other benefit.
(iv)    For purposes of Section 409A, Mr. Schultz’s right to receive any installment payment pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.
(v)    Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within thirty (30) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Bank in order to comply with Section 409A.
(vi)    Notwithstanding any other provision under this Agreement, solely to the extent that a delay in payment is required in order to avoid the imposition of any tax under Section 409A, if a payment obligation under this Agreement arises on account of Mr. Schultz’s 

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“separation from service” (within the meaning of Section 409A) in good faith by the Bank’s Board, then payment of any amount or benefit provided under this Agreement that is considered to be non-qualified deferred compensation for purposes of Section 409A and that is scheduled to be paid within six (6) months after such separation from service shall be paid without interest on the first business day after the date that is six (6) months following Mr. Schultz’s separation from service.
(vii)    Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” subject to Section 409A be subject to offset, counterclaim or recoupment by any other amount payable to Mr. Schultz unless otherwise permitted by Section 409A.
(viii)    Mr. Schultz hereby acknowledges that he has been advised to seek and has sought the advice of a tax advisor with respect to the tax consequences to  him of all payments pursuant to this Agreement, including any adverse tax consequences or penalty taxes under Section 409A and corresponding provisions of applicable state tax law.  Mr. Schultz hereby acknowledges and agrees that no representations have been made to him relating to the tax treatment of any payment pursuant to this Agreement under Section 409A and the corresponding provisions of any applicable state income tax laws. 
6.    Regulatory Approval.  Notwithstanding any other provision of this Agreement to the contrary, any payments made to Mr. Schultz pursuant to this Agreement or otherwise, are subject to prior review and non-objection by the Finance Agency, and are subject to and conditioned upon compliance with 12 U.S.C. section 4518(e), and any applicable laws and regulations, including 12 C.F.R. Part 1231.  
7.    Choice of Law.  This Agreement shall be governed and construed by the laws of the United States, and to the extent state law may be applicable, by the laws of the State of California applicable to contracts made and to be performed wholly within California without regard to the conflicts of laws principles thereof.  
8.    Arbitration and Waiver of Jury Trial, Attorneys’ Fees.  Any and all disputes which may arise from or relate to this Agreement or Mr. Schultz’s employment with the Bank or his Termination, whether initiated by Mr. Schultz or the Bank, shall be subject to final and binding arbitration pursuant to the Bank’s Dispute Resolution and Binding Arbitration Procedure (“Arbitration Procedure”).  The arbitrator shall have the authority only to enforce the legal and contractual rights of the parties and shall not add to, modify, disregard or refuse to enforce any contractual provision.  Mr. Schultz and the Bank each recognize and agree that by entering into this agreement, they each are waiving any and all rights to a trial by jury.  The prevailing party shall be entitled to recover reasonable attorneys’ fees and costs in accordance with applicable law. The parties agree the Bank shall bear arbitration fees and arbitrator compensation and expenses consistent with the Arbitration Procedure and applicable law.  
9.    Notices.  All notices, requests and other communications hereunder shall be in writing and shall be delivered by courier or other means of personal service (including by means 

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of a nationally recognized courier service or professional messenger service), or mailed first class, postage prepaid, by certified mail, return receipt requested, in all cases, addressed to: 
If to the Bank or the Board: 
Federal Home Loan Bank of San Francisco 
600 California Streets 
San Francisco, CA 94108 
Attention: Legal Department 
If to Mr. Schultz:
At the residence address on file with the Bank
All notices, requests and other communications shall be deemed given on the date of actual receipt or delivery as evidenced by written receipt, acknowledgement or other evidence of actual receipt or delivery to the address.  In case of service by telecopy, a copy of such notice shall be personally delivered or sent by registered or certified mail, in the manner set forth above, within three business days thereafter.  Any party hereto may from time to time by notice in writing served as set forth above designate a different address or a different or additional person to which all such notices or communications thereafter are to be given.
10.    Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.  In the event any provision or term hereof is deemed to have exceeded applicable legal authority or shall be in conflict with applicable legal limitations, such provision shall be reformed and rewritten as necessary to achieve consistency and compliance with such applicable law.
11.    No Waiver. Mr. Schultz’s or the Bank’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right Mr. Schultz or the Bank may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
12.    Assignment; Assumption by Successor.  The rights of the Bank under this Agreement may, without the consent of Mr. Schultz, be assigned by the Bank, in its sole and unfettered discretion, to any person, firm, corporation or other business entity which at any time, whether by purchase, merger, consolidation or otherwise, directly or indirectly, acquires all or substantially all of the assets or business of the Bank.  The Bank will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Bank expressly to assume and to 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; provided, however, that no such “Bank" shall mean the Bank as hereinbefore defined and any successor to its business or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise.

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13.    Entire Agreement. As of the Effective Date, this Agreement constitutes the final, complete and exclusive agreement between Mr. Schultz and the Bank with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, made to Mr. Schultz by the Bank.  Nobody at the Bank has been authorized to enter into any other agreement with Mr. Schultz or make any promises or representations to him with respect to retention pay that are not a part of this Agreement.  
14.    Consultation With Counsel.  Mr. Schultz acknowledges that he has had a full and complete opportunity to consult with counsel and other advisors of his own choosing concerning the terms, enforceability and implications of this Agreement, and the Bank has not made any representations or warranties to him concerning the terms, enforceability or implications of this Agreement other than as reflected in this Agreement.
WITNESS WHEREOF, the parties have executed this Agreement as of the date last set forth below.

	
		
	FEDERAL HOME LOAN BANK 
OF SAN FRANCISCO

	DEAN SCHULTZ

	By:               /s/ Lisa B. MacMillen                        
	By:               /s/ Dean Schultz                       

	Lisa B. MacMillen
Executive Vice President and
   Chief Operating Officer

May 20, 2016

	

May 20, 2016

 

6Exhibit

Exhibit 10.2

Independent Contractor Consulting Agreement
FEDERAL HOME LOAN BANK OF SAN FRANCISCO, 600 California Street, San Francisco, California ("the Bank"), hereby retains Dean Schultz, ################## ("Mr. Schultz") to furnish the services hereinafter described upon the following terms and conditions:
1.    Term
This Independent Contractor Consulting Agreement (“Agreement”) shall be effective as of June 1, 2016 (“Effective Date”) and shall continue in effect until December 31, 2016, unless extended by mutual written agreement of the parties or terminated before December 31, 2016, in accordance with Section 10 of this Agreement.
2.    Services Provided by Mr. Schultz
		
	2.1
	Mr. Schultz shall perform the services described in each Statement of Work attached hereto as Exhibit A and incorporated herein by reference. Each Statement of Work which comprises Exhibit A and is included herein shall be identified by reference to this Agreement and shall be sequentially numbered beginning with Schedule 1. Each and every Statement of Work included in Exhibit A shall be subject to the terms and conditions of this Agreement and shall hereafter be referred to, collectively and individually, as the “Statement of Work” or “Exhibit A”. Any changes or additions to the scope of services as described in the Statement of Work shall be in writing and subject to the prior written consent of the Bank.

		
	2.2
	Mr. Schultz agrees to perform all services hereunder on a best efforts basis, in a workmanlike manner in accordance with the highest industry standards and otherwise to the Bank's reasonable satisfaction. 

3.    Fees and Expenses
		
	3.1
	In consideration for the above-described services, the Bank shall pay Mr. Schultz fees for his services as set forth in each Statement of Work attached hereto as Exhibit A and incorporated herein by reference, unless changed by mutual written agreement.

		
	3.2
	In addition, Mr. Schultz will be reimbursed on a monthly basis for all reimbursable expenses incurred and paid by him during the preceding month. Mr. Schultz shall provide the Bank with all receipts for such expenses. Travel expenses will be paid or reimbursed within thirty (30) days after Bank receipt of the travel receipts for expenses and only to the extent provided in the travel and reimbursement policy for contractors attached hereto as Exhibit B and incorporated herein by reference, unless changed by mutual agreement.  

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	3.3
	A separate itemized invoice for each Statement of Work shall be submitted to the Bank by Mr. Schultz on the last day of each month for the work performed during that month. The invoice shall reflect this Agreement and applicable Statement of Work, and provide a brief description of the services rendered by Mr. Schultz during the preceding payment period. 

		
	3.4
	The Bank claims exemption from payment of any taxes which might arise under this Agreement, pursuant to 12 U.S.C. § 1433 or any other applicable statute or regulation. Mr. Schultz's invoices shall reflect such claimed exemption, and Mr. Schultz shall not charge the Bank for any sales taxes with respect to which the Bank is exempt.

4.    Ownership
All Work Product (as defined below) shall become and remain the sole and exclusive property of the Bank and shall be considered “works made for hire.” As used in this Agreement, “Work Product” means all materials and information (whether written, recorded, or otherwise stored), prepared for the Bank pursuant to this Agreement by Mr. Schultz. Mr. Schultz warrants that he has the right to use and to incorporate in the Work Product any materials, concepts, processes or information so used or incorporated without violation of any right of any third party and without creating any obligation on the part of the Bank to pay any fee, license, penalty or other expense, other than the payment to Mr. Schultz set forth above. Mr. Schultz covenants that the Work Product shall be delivered to the Bank free and clear of all liens, encumbrances or claims of any third party. 
5.    Confidentiality
Mr. Schultz acknowledges and agrees that the Bank’s engagement of Mr. Schultz to furnish the services described herein creates a relationship of confidence and trust between the Bank and Mr. Schultz with respect to all Confidential Information (as defined below) which Mr. Schultz gains access to or knowledge of in the performance of this Agreement. 
As used herein, Confidential Information is broadly defined to include all information (whether or not marked or identified orally or in writing as trade secrets, sensitive confidential or proprietary) of the Bank which either: (i) is not generally known or is useful in the conduct of the business of the Bank; (ii) confers or tends to confer on the Bank a competitive advantage over one who does not possess such information; or (iii) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, competitors, customers, vendors and/or other persons who can obtain economic value from its disclosure or use. As used herein, Confidential Information also includes all Work Product. Without limitation to the foregoing, Confidential Information includes, but is not limited to, the Bank’s information systems, software programs and licenses, trading platforms, technology, vendor names and relationships and the extent and adequacy of the Bank’s systems security, customer and vendor lists, vendor intellectual property, marketing information, strategies, forecasts and methodology, business plans, financial information, budgets and projections, technical information and know-how, computer and security systems, forms, transaction documents and personnel data about the Bank’s employees or vendors, including nonpublic personal information, hourly rates or fees paid under this Agreement, and all materials and 

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information of the Bank’s shareholders and customers, the Federal Housing Finance Agency or any other applicable regulatory agency. Mr. Schultz agrees to keep all Confidential Information confidential and to use it solely for the performance of services under this Agreement. Mr. Schultz further agrees not to disclose the Confidential Information to any third party without the prior written consent of the Bank. 
Mr. Schultz further agrees to take all reasonable precautions to guard the confidentiality of the Confidential Information and to limit access to same to those of his authorized agents as are necessary to perform the services under this Agreement and to report to the Bank and take appropriate remediation actions if security or confidentiality is breached. Mr. Schultz agrees that he will sign a Trade Secrets and Confidentiality Agreement and comply with the Information Security Policy and Enterprise Information Security and Technical Standards (“Information Security Policy and Standards”), incorporated herein by reference. To the extent that Mr. Schultz is given, or has access to, nonpublic personal information (referenced above) during the course of this agreement, Mr. Schultz agrees to comply with all applicable local, state and federal laws, including, without limitation, all applicable privacy and data protection laws, and to maintain such nonpublic personal information that he receives or accesses in accordance with applicable federal and state privacy laws. Mr. Schultz shall notify the Bank promptly following discovery of any breach or compromise of the security, confidentiality, or integrity of any such nonpublic personal information. Mr. Schultz's obligations under this Section 4 shall survive the termination or expiration of this Agreement and, to the extent stricter standards and/or any additional confidentiality obligations are set forth in any Trade Secrets and Confidentiality Agreement or any other non-disclosure agreement executed by Mr. Schultz and the Bank, such stricter standards and/or such additional obligations shall govern.
6.    Warranties of Mr. Schultz
Mr. Schultz warrants that he will not directly or indirectly, reverse engineer, decompile, disassemble or otherwise attempt to discover the source or underlying ideas or algorithms of any information systems or software used by the Bank or any information systems or software provided by a third party (“Information Systems”); modify, translate, or create derivate works based on any Information Systems used by the Bank; use any Information Systems for timesharing or service bureau purposes or otherwise for the benefit of a third party, obfuscate, remove or alter any of the logos, trademarks, internet links, patent or copyright notices, confidentiality or proprietary legends or other notices or markings that are on or in any Information Systems or the related documentation; or send or store material containing software viruses, worms, Trojan horses or other harmful computer code, files, scripts, agents or programs. 
7.    Contractor Status
It is expressly agreed and understood that Mr. Schultz is performing services under this Agreement as a contractor for the Bank and that Mr. Schultz is not an employee or agent of the Bank. Accordingly, Mr. Schultz has no authority to make any contract or representation or to create any obligation or liability whatsoever on behalf of the Bank. Nothing herein contained shall be construed as reserving to the Bank any right to control Mr. Schultz with respect to Mr. Schultz's conduct in the performance 

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of this Agreement or the manner in which the services provided for herein are performed. All materials and equipment required by Mr. Schultz to perform the services under this Agreement shall be furnished by Mr. Schultz at his expense, unless otherwise provided by the Bank. Mr. Schultz shall make no representations to any persons contrary to the foregoing limitations on the scope of his relationship with the Bank, and will indemnify, defend and hold harmless the Bank from and against all loss, damage, or liability resulting from any claims made by any person that Mr. Schultz is an employee or agent of the Bank, as well as any costs or expenses arising therefrom (including, but not limited to, attorneys' fees and expenses). All liability to persons actually providing services under this Agreement or related to the provision of such services, including, but not limited to, payment of wages or other compensation, including overtime, withholding of federal, state, and social security taxes, insurance, unemployment benefit assessments, workers' compensation, and similar charges related to wages or other compensation, shall be the sole responsibility of Mr. Schultz. The Bank shall not provide benefits of any kind, including, but not limited to, health insurance, life insurance, educational reimbursements, credit, savings plans, sick pay benefits pursuant to the San Francisco sick leave ordinance or vacation to Mr. Schultz.
8.    Indemnification
Mr. Schultz agrees to indemnify and hold the Bank harmless from and against all loss, liability, damage, cost, or expense (including reasonable attorney fees and costs) (“Losses”) to the extent those Losses are determined by a final, non-appealable order or arbitral award to have resulted from Mr. Schultz’s gross negligence or willful misconduct in the performance of the services by Mr. Schultz under this Agreement.  The Bank agrees to indemnify and hold Mr. Schultz harmless from any Losses relating to the services performed by Mr. Schultz under this Agreement (including any Losses asserted by the Bank, its agents or representatives, or third parties and any Losses sustained by Mr. Schultz when participating in any legal, regulatory, or administrative proceeding relating to the services), except to the extent those Losses are determined by a final, non-appealable order or arbitral award to have resulted from Mr. Schultz’s gross negligence or willful misconduct in the performance of the services.  Neither party will be liable for any lost profits or other indirect, consequential, incidental, punitive or special damages.  In no event shall either party’s liability to the other party for Losses incurred in connection with the services under this Agreement exceed the fees received by Mr. Schultz from the Bank.
9.    Taxes
Mr. Schultz agrees to pay all applicable taxes which may arise as a result of this Agreement, including, but not limited to, federal, state, and local personal income and other payroll taxes payable with respect to his compensation.. Mr. Schultz shall indemnify, defend, and hold harmless the Bank, its agents, directors, officers and employees from and against any and all loss, damage, or liability resulting from Mr. Schultz's failure to comply with the provisions of this Section 9.

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10.    Termination 
		
	10.1
	This Agreement may be terminated immediately by the Bank in the event of a breach of the Agreement by Mr. Schultz.

		
	10.2
	Either party may terminate this Agreement or any Statement of Work at any time by giving the other party written notice of termination. Termination or expiration of this Agreement or any Statement of Work shall not relieve the parties of any amounts owing between them, or unavoidably contracted for or incurred, as of the date of termination. Termination or expiration of this Agreement or any Statement of Work shall not terminate any rights or obligations arising prior to or upon termination or expiration, including, but not limited to, the obligations of Mr. Schultz described in Sections 5, 8 and 9 of this Agreement.

11.    Assignment
Mr. Schultz may not voluntarily or involuntarily assign or otherwise transfer, in whole or in part, this Agreement or any rights hereunder, nor may Mr. Schultz voluntarily or involuntarily delegate, subcontract, or otherwise transfer, in whole or in part, any duties or performance or obligations owed under this Agreement without the prior written consent of the Bank. Any and all attempted assignments, delegations, subcontracts, or other transfers without the Bank's prior written consent shall be void.
12.    Bank Property
Mr. Schultz will take every reasonable precaution to safeguard the Bank's property that is entrusted to his custody and control. Material developed for the Bank will not be released or used by Mr. Schultz for his own purposes or in any other way without the Bank's prior written approval.
13.    Entire Agreement
This Agreement, the exhibits, schedules and documents referred to herein, as well as any Trade Secrets and Confidentiality Agreement or Information Security Policy and Standards as are signed or acknowledged by Mr. Schultz at the request of the Bank, constitute the entire agreement between the parties relating to the subject matter hereof and supersede all prior written and oral agreements, representations, and understandings of the parties with respect to the subject matter hereof. There are no other agreements, representations, or warranties not set forth herein; provided, however, that nothing herein shall affect any continuing obligations of Mr. Schultz to the Bank arising from any prior agreements with the Bank. No supplement, change order, modification, or amendment of this Agreement shall be binding unless executed in writing by both of the parties. No waiver of any provisions of this Agreement shall be deemed, or shall constitute, a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver.

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14.    Effective Headings
The subject headings of the sections of this Agreement are included for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions.
15.    Governing Law
This Agreement shall be governed by, and construed in accordance with the federal law and to the extent not inconsistent therewith, applicable California law (regardless of the laws that might otherwise govern under applicable principles of conflicts of laws).
16.    Jurisdiction
Each party hereby irrevocably submits to the jurisdiction and venue of any state or federal court in the city and county of San Francisco, California, in any action or proceeding brought to enforce or otherwise arising out of or related to this Agreement and irrevocably waives to the fullest extent permitted by law any objection which such party may now or hereafter have to the resting of such jurisdiction and venue in such forum, and any claim that such forum is an inconvenient forum.
17.    Notices
All notices or other communications regarding this Agreement shall be delivered by mail, email, fax or in person. Any notice of termination of the Agreement will also include a follow-up notice by mail. Contact information is as follows:
		
	To the Bank:
	Federal Home Loan Bank of San Francisco 
600 California Street, Suite 300 
San Francisco, California 94108 
Attention:    Greg Seibly

President and Chief Executive Officer
Email:   ########
Phone:     ########
Fax:    ########

To Mr. Schultz:            Dean Schultz
############
############
Email:      #########
Phone:    #########
            

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18.    Attorneys' Fees and Expenses
The prevailing party in any action or proceeding to enforce or interpret this Agreement or otherwise arising out of or in connection with the subject matter hereof (including, but not limited to, any suit, arbitration, entry of judgment, post-judgment motion or enforcement, appeal, bankruptcy litigation, attachment or levy) shall be entitled to recover its costs and expenses, including, but not limited to, reasonable attorneys’, experts’ and consultants’ fees and costs.
19.    Equal Employment Opportunity and Non-discrimination
As required by 12 C.F.R. Section 1207.21(b)(6), during the performance of this contract, Mr. Schultz agrees as follows:
		
	1.
	Mr. Schultz shall practice the principles of equal employment opportunity and non-discrimination in all his business activities.

		
	2.
	Mr. Schultz shall include the provisions of paragraph (1) above, in each subcontract he enters for services or goods provided to the Bank.

IN WITNESS WHEREOF, the parties have executed the Agreement as of the Effective Date.

	
					
	FEDERAL HOME LOAN BANK OF SAN FRANCISCO
	 
	 
	Dean Schultz

	Signature: 
	/s/ J. Gregory Seibly
	 
	Signature: 
	/s/ Dean Schultz

	Name: 
	J. Gregory Seibly
	 
	Name: 
	Dean Schultz

	Title: 
	President & CEO
	 
	Title: 
	Consultant

	Date:
	June 30, 2016
	 
	Date:
	June 30, 2016

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Exhibit A 
Schedule 1
Independent Contractor
Consulting Agreement 
between Dean Schultz and Federal Home Loan Bank of San Francisco  
dated June 1, 2016 
Statement of Work 
June 1, 2016
This Statement of Work between Dean Schultz (“Mr. Schultz”) and the Federal Home Loan Bank of San Francisco (“the Bank”) is a part of, and except as otherwise stated herein, is subject to and governed by all of the terms and conditions of, the above-referenced Independent Contractor Consulting Agreement between Mr. Schultz and the Bank (“Agreement”).
Mr. Schultz shall serve as a consultant to the Bank, performing general project advisory functions and providing knowledge and information based on his role as the Bank’s former President and Chief Executive Officer, at such times and places as the Bank’s President and Chief Executive Officer may reasonably request. During the term of this Agreement, Mr. Schultz will provide periodic reports of work progress and deliverables to the Bank’s President and Chief Executive Officer, as needed.  
Such services shall be provided at 600 California, San Francisco, California, or other locations, as appropriate.  
Mr. Schultz will be paid $25,000 a month (or a pro rata amount through the date of termination, if the Agreement is terminated prior to the last day of the month) following the end of a month when services were provided, in accordance with the process outlined in Section 3.3 of this Agreement. He will report to the Bank’s President and Chief Executive Officer.  
This Statement of Work shall be effective as of June 1, 2016, and shall continue in effect until December 31, 2016, unless extended by mutual written agreement of the parties or terminated before December 31, 2016, in accordance with Section 10 of the Agreement. 
The terms and conditions of this Exhibit A-Schedule 1 control the Agreement to the extent they are inconsistent. In all other respects the Agreement shall continue in full force and effect notwithstanding the provisions of this Exhibit A-Schedule 1. 

	
					
	FEDERAL HOME LOAN BANK OF SAN FRANCISCO
	 
	 
	Dean Schultz

	Signature: 
	/s/ J. Gregory Seibly
	 
	Signature: 
	/s/ Dean Schultz

	Name: 
	J. Gregory Seibly
	 
	Name: 
	Dean Schultz

	Title: 
	President & CEO
	 
	Title: 
	Consultant

	Date:
	June 30, 2016
	 
	Date:
	June 30, 2016

Exhibit B
Vendor Expense and Reimbursement Policy

Invoices with vendor out-of-pocket expenses must be supported by documentation as required below.  The responsibility center must attach the supporting documentation to the invoice before forwarding to Accounts Payable for payment.

Requirements as outlined in the Bank’s Reimbursement and Travel Expense Policy for vendor out-of-pocket expenses include, but are not limited to, the following:
Receipts: 
		
	•
	In general, original receipts for expenses exceeding $50.00 per occurrence must be submitted with the invoice.  However, it is recognized that some vendors may not be able to provide original receipts (for example, if a vendor needs to retain original receipts for tax reporting purposes); such instances require a written explanation from the vendor as to why original receipts are not being submitted with the invoice.

Airfare: 

		
	1.
	Documentation requirements for airfare reimbursement:

		
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	Airfare expenses must be supported by original passenger ticket receipts or confirmations/receipts issued by the airlines for e-ticket purchases and documentation showing proof of payment for the flight taken.   

		
	2.
	General guidelines to keep in mind for arranging the least costly air travel:

		
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	Travelers should purchase coach or economy class seats at the lowest available fare.  Travelers are also strongly encouraged to use such low-cost carriers as Jet Blue, Southwest, etc. whenever possible. 

		
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	Travelers may not fly by first class, business class, charter or private plane without prior approval.  

		
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	Travelers should complete their travel arrangements at the earliest possible time to avoid the limited, and often costly, alternative accommodations available on short notice. For example, flights arranged one month in advance are generally far less costly than those arranged one week in advance. 

		
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	Note: Accounts Payable has the sole discretion of determining whether airfare expenses appear excessive.  Such expenses require exception processing before reimbursement can be issued to the vendor.  See “Exceptions” section below for details on exception processing requirements.

		
	3.
	Non-refundable airline tickets that have been cancelled:

		
	•
	The cost of non-refundable airline tickets (for which the traveler cancels the flights) will be reimbursed if the vendor provides (1) the original non-refundable tickets to Accounts Payable and (2) an explanation as to why the flights were not taken. 

Lodging: 
The Bank will reimburse vendors for the actual cost of lodging.  Moderately priced single accommodations should generally be used.  Costs are limited to $350.00 per night (before taxes). 

If a traveler shares a hotel room with someone not traveling on official Bank business, reimbursement will be made on the basis of single-rate accommodations. 

		
	•
	All lodging expenses must be documented by original receipts and submitted with the invoice.  

		
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	Lodging costs that occur one day before the traveler is required to be at the destination will be reimbursed.  For example, if the traveler is required to be at the destination on Monday, then the Bank will reimburse lodging on Sunday night.  

		
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	The Bank will generally not reimburse lodging costs on Saturday night if the traveler is not required to be at the destination until Monday, unless the traveler can show a savings to the Bank by taking a Saturday flight instead of a Sunday flight.  The traveler must attach a quote for the comparable flight on Sunday, and show that the savings between the airfare costs for the Saturday flight and the Sunday flight exceed the Saturday night lodging costs.

		
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	Lodging costs incurred the day the traveler is no longer required to be at the destination will be reimbursed only if the return flight from the destination is longer than three hours.

		
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	In-room movie rental costs are not reimbursable by the Bank.

		
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	Spa fees incurred are not reimbursable by the Bank.  

		
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	Resort fees assessed to all guests are eligible for reimbursement.  The resort fee is considered part of the cost of the room, and is added to the lodging cost in calculating the per night lodging limit of $350.00.

Meal Expenses: 
The Bank will reimburse vendors for the actual cost of meals (including tips and drinks) incurred during non-local travel to a maximum of $60 per day.

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