Document:

Exhibit 10.2.3

 

THE FEDERAL HOME LOAN BANK OF BOSTON

THRIFT BENEFIT EQUALIZATION PLAN

(as adopted July 18, 2008)

 

Federal Home Loan Bank of Boston (the “Bank”) adopted
the Federal Home Loan Bank of Boston Thrift Benefit Equalization Plan (the “Plan”),
as a component of the Federal Home Loan Bank of Boston Benefit Equalization
Plan, effective January 1, 1993. 
The Nonqualified Deferred Compensation Program for the Directors of the
Bank was merged into the Plan effective on the close of business December 31,
2006, and the Plan was amended and restated to comply with Code Section 409A,
as enacted by the American Jobs Creation Act of 2004 and applicable regulations
thereunder, effective January 1, 2007 (or such earlier date as may be
required by law).  The Plan is hereby
further amended and restated to comply with final regulations issued under Code
Section 409A effective January 1, 2008; provided, however, that any
provision required to be effective on and after January 1, 2005 in order
for the Plan to comply with Code Section 409A shall become effective as of
January 1, 2005 (or such later date as shall be permitted under applicable
Code Section 409A transition rules).

 

The Plan is established and maintained by the Bank in
order to provide Eligible Executives and Directors an opportunity to defer
taxation on income and to provide Eligible Executives with the benefits which
would have been provided under the Pentegra Defined Contribution Plan for
Financial Institutions (the “Qualified Plan”) if (a) their benefits under
the Qualified Plan were not limited by certain limitations imposed by the
Internal Revenue Code applicable to the Qualified Plan, and (b) “Base
Salary” as defined in the Qualified Plan took into account amounts paid under
the Bank’s incentive compensation plan(s), as well as elective deferrals
hereunder.

 

The Plan is a governmental plan under Section 4(b) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and
is therefore exempt from coverage under ERISA. 
The Plan is unfunded and maintained primarily for the purpose of
providing deferred compensation to a select group of management or highly
compensated employees, and Bank directors, and is not intended to be qualified
under Section 401(a) of the Internal Revenue Code.

 

ARTICLE I

DEFINITIONS

 

Each word used herein not defined below that begins
with a capital letter and is defined in the Qualified Plan shall have the same
definition as the definition given to that word in the Qualified Plan.  Wherever used herein, the following terms
shall have the meanings hereinafter set forth:

 

1.1           “Account” or “Deferred Compensation Account” means
the separate account established under the Plan for each Participant, as
described in Section 5.1.

 

 

1.2           “Administrator” means the Committee or
such person or persons as may be appointed by the Committee to be responsible
for those functions assigned to the Administrator under the Plan.

 

1.3           “Affiliate” means any entity that is a
member of a “controlled group” of corporations with the Bank under Code Section 414(b) or
a trade or business under common control with the Bank under Code Section 414(c);
provided, however, that in applying Code Sections 1563(a)(1), (2) and (3) for
purposes of Code Section 414(b), the language “at least 50 percent” will be
used instead of “at least 80 percent” each place it appears, and in applying
Treasury Regulation Section 1.414(c)-2 for purposes of Code Section 414(c),
the language “at least 50 percent” will be used instead of “at least 80 percent”
each place it appears.  In addition, to
the extent that the Administrator determines that legitimate business criteria
exist to use a reduced ownership percentage to determine whether an entity is
an Affiliate for purposes of determining whether a Termination of Service has occurred,
the Administrator may designate an entity that would meet the definition of “Affiliate”
substituting 20 percent in place of 50 percent in the preceding sentence as an
Affiliate in Appendix A hereto.  Such
designation shall be made by December 31, 2007 or, if later, at the time a
20 percent or more ownership interest in such entity is acquired.

 

1.4           “Bank” means the Federal Home Loan Bank
of Boston.

 

1.5           “Base Salary” means “Salary” as defined
for purposes of the Qualified Plan.

 

1.6           “Beneficiary” means the person, persons
or trust designated by a Participant as direct or contingent beneficiary in the
manner prescribed by the Administrator. 
The Beneficiary of a Participant who has not effectively designated a
beneficiary shall be the Participant’s estate.

 

1.7           “Board of Directors” means the Board of
Directors of the Bank.

 

1.8           “Code Limitations” means the cap on
compensation taken into account by the Qualified Plan under Code Section 401(a)(17);
the limitations on Section 401(k) contributions necessary to meet the
average deferral percentage (“ADP”) test under Code Section 401(k)(3); the
limitations on employee and matching contributions necessary to meet the
average contribution percentage (“ACP”) test under Code Section 401(m);
the dollar limitations on elective deferrals under Code Section 402(g);
and the overall limitation on contributions imposed by Code Section 415(c),
as such provisions may be amended from time to time, and any similar successor
provisions of federal tax law.

 

1.9           “Committee” means the Personnel
Committee of the Board of Directors, which is authorized to administer the Plan
and to perform the functions described in Article VII.

 

1.10         “Compensation” means (a) with
respect to an Executive, Base Salary and/or Incentive Compensation, as
applicable; and (b) with respect to a Director, the meeting fees paid by
the Bank to the Director.

 

1.11         “Deferral Period” means the period
described in Section 3.3 of the Plan.

 

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1.12         “Director” means a member of the Board
of Directors of the Bank, other than an Employee.

 

1.13         “Disability” means that the Participant (a) is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months; (b) is, by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than 3 months under an accident
and health plan covering employees of the Bank; or (c) has been determined
to be totally disabled by the Social Security Administration.

 

1.14         “Effective Date” means January 1,
2008.  The Plan was initially effective January 1,
1993 and was most recently restated effective January 1, 2007.  Any provision of this amendment and
restatement required to be effective on and after January 1, 2005 in order
for the Plan to comply with Code Section 409A shall become effective as of
January 1, 2005 (or such later date up to January 1, 2008 as shall be
permitted under applicable Code Section 409A transition rules).

 

1.15         “Elective Deferral” means the amount of
Compensation a Participant elects to defer pursuant to Article III of the
Plan.

 

1.16         “Eligible Executive” or “Executive” means an employee of the
Bank who is a corporate officer and who has been selected to be a Participant
in the Plan by the Committee.

 

1.17         “Hardship” means an unforeseeable
emergency that is caused by an event beyond the control of the Participant that
would result in severe financial hardship to the Participant resulting from (a) a
sudden and unexpected illness or accident of the Participant or the spouse or a
dependent of the Participant (as defined in Code Section 152(a)), (b) a
loss of the Participant’s property due to casualty (including the need to
rebuild a home following damage to a home not otherwise covered by insurance,
for example, not as a result of a natural disaster), or (c) such other
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant, all as determined in the sole discretion
of the Administrator.  In addition, the
need to pay for medical expenses, including non-refundable deductibles, as well
as for the costs of prescription drug medication, or the need to pay for the
funeral expenses of a spouse or a dependent may also constitute a Hardship
event.  The Administrator shall determine
whether the circumstances presented by the Participant constitute an
unanticipated emergency.  Such
circumstances and the Administrator’s determination will depend on the facts of
each case, but, in any case, payment may not be made to the extent that such
hardship is or may be relieved as described in Sections 6.1.1 through 6.1.4
below.

 

1.18         “Incentive Compensation” means bonuses
under the Bank’s Executive Incentive Plan and, if applicable, any long-term
incentive compensation payable to a Participant under the Bank’s incentive
compensation plan(s).

 

1.19         “Matching Contribution” means the
amounts credited to a Participant’s Account under Article IV of the Plan
with respect to Elective Deferrals.

 

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1.20         “Participant” means (a) an
Executive or former Executive who elects to participate in the Plan in
accordance with the terms and conditions of the Plan or who has an Account in
the Plan that has not been fully distributed; and (b) any Director who
elects to participate in the Plan or who has an Account in the Plan that has
not been fully distributed.

 

1.21         “Plan” means The Federal Home Loan Bank
of Boston Thrift Benefit Equalization Plan, as set forth herein or as it may be
amended or restated from time to time.

 

1.22         “Plan Year” means the calendar year.

 

1.23         “Qualified Plan” means the Pentegra
Defined Contribution Plan for Financial Institutions, as from time to time
amended.

 

1.24         “Required Withholdings” means the
federal, state or local employment taxes, including applicable FICA taxes
required to be withheld under Section 3101 of the Code from any (a) Elective
Deferrals, (b) elective deferrals on behalf of the Participant to the
Qualified Plan, (c) contributions by the Participant to any welfare
benefit plan maintained by the Bank, and/or (d) any other compensation not
paid to the Participant in cash, and all federal, state or local income taxes
attributable thereto required to be withheld from income, and any additional
federal, state or local income or employment taxes attributable to such
withholdings.  The Administrator shall
determine Required Withholdings in its discretion.

 

1.25         “Scheduled Distribution” means a
distribution from a Participant’s Scheduled Distribution Sub-Account in
accordance with Section 6.3.

 

1.26         “Scheduled Distribution Sub-Accounts” or
“Sub-Accounts” means the
separate bookkeeping accounts established by the Administrator under Section 5.1
to record the portion(s) of a Participant’s Account subject to separate
Scheduled Distribution elections.

 

1.27         “Termination of Service” means, with
respect to an Executive, the severing of employment with the Bank and any
Affiliates, voluntarily or involuntarily, for any reason.  A Termination of Service will be deemed to
have occurred if the facts and circumstances indicate that the Bank and the
Participant reasonably anticipate that no further services will be performed
after a certain date or that the level of bona
fide services the Participant will perform for the Bank and its
Affiliates after such date (whether as an employee or as an independent
contractor) will permanently decrease to no more than 20% of the average level
of bona fide services performed
(whether as an employee or an independent contractor) over the immediately
preceding 36-month period (or the full period of services to the employer if
the Participant has been providing services to the Bank and its Affiliates less
than 36 months).  A Participant will not
be deemed to have incurred a Termination of Service while he or she is on
military leave, sick leave, or other bona fide leave
of absence (such as temporary employment by the government) if the period of
such leave does not exceed six months or such longer period as the Participant’s
right to reemployment with the Bank is provided either by statute or by
contract.  For this purpose, a leave of
absence is bona fide
only if there is a reasonable expectation that the Participant will return to
employment at the conclusion of the leave. 
If the period of leave exceeds six months and the Participant’s right to
reemployment is not provided either by statute or by contract, the Termination
of Service will be deemed to occur on the first date immediately 

 

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following such six-month
period.  With respect to a Director, the
term “Termination of Service” means that the Director has ceased to be a member
of the Board of Directors of the Bank, and does not otherwise provide services
(as determined under this paragraph) as an employee or independent contractor
of the Bank or any Affiliate.  Whether an
individual has incurred a Termination of Service shall be determined in
accordance with the provisions of Section 409A.

 

1.28         “Valuation Date” means the close of
business of each business day, or such other valuation date or dates
established by the Administrator.

 

ARTICLE II

PARTICIPATION

 

2.1           Eligibility.  Each Executive may become a Participant upon
the effective date of his or her designation as an Executive eligible for
participation in the Plan by the Board of Directors or the Committee. Each
Director may become a Participant upon his or her becoming a member of the
Board of Directors of the Bank.

 

2.2           Participation in the Plan.  An Eligible Executive or Director may elect
to participate in the Plan for any Plan Year by delivering to the Administrator
a properly executed election at the time and in the form provided by the
Administrator, pursuant to which the Eligible Executive or Director elects to
defer receipt of a specified portion of the Compensation that would otherwise
be payable to such Executive for the Plan Year, as described in Article III
hereof.

 

2.3           Cessation of Participation.  An Executive shall cease to be a Participant
in the Plan if (a) he or she incurs a Termination of Service for any
reason, (b) he or she remains in the service of a Bank but ceases to be an
Eligible Executive as described in Section 1.16 due to a change in
employment status, except to the extent that the Committee determines
otherwise, or (c) the Plan is terminated or otherwise amended so that the
Executive ceases to be eligible for participation; provided, however, that such
individual shall continue to be a Participant solely with respect to his or her
vested Account balance until such Account balance is distributed from the
Plan.  Such cessation of participation
shall be effective upon the date of the change in status described in clause (a) above,
upon the end of the Deferral Period for a change in status described in (b) above,
or upon the effective date of an amendment or termination of the Plan described
in clause (c) above.  A Director
shall cease to be a Participant in the Plan if he or she ceases to be a member
of the Board of Directors for any reason; provided, however, that such
individual shall continue to be a Participant solely with respect to his or her
vested Account balance until such Account balance is distributed from the Plan.

 

ARTICLE III

DEFERRAL OF
COMPENSATION

 

3.1           Election to Defer.  A Participant may elect to defer receipt of a
portion of his or her Compensation for a Plan Year by delivering a properly
executed election to the Administrator within the time specified in Section 3.2.  The Participant’s election shall be in a
written form acceptable to the Administrator and shall specify:

 

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3.1.1.       the whole percentage of
Salary, other than Incentive Compensation, for the Plan Year to be deferred to
the Plan, which percentage may not exceed 100%, reduced to the extent necessary
to provide for any Required Withholdings;

 

3.1.2.       the whole percentage of
Incentive Compensation for the Plan Year to be deferred to the Plan, which
percentage may not exceed 100%, reduced to the extent necessary to provide for
any Required Withholdings;

 

3.1.3.       if applicable, the
investment fund or funds in which the Participant’s Elective Deferrals, and
Matching Contributions attributable to such Elective Deferrals, will be deemed
to be invested pursuant to Section 5.2;

 

3.1.4.       if applicable, the specific
Scheduled Distribution Sub-Account or Sub-Accounts into which all or a portion
of such Elective Deferrals and Matching Contributions will be directed, as
described in Section 6.3; and

 

3.1.5.       to the extent permitted by
the Administrator under Section 6.4.1, the payment commencement date and
method of distribution to apply to benefits distributable upon the Participant’s
Termination of Service.

 

An Executive who elects not to participate in the Plan
at the time he or she first becomes eligible to do so may elect to become a
Participant in any subsequent Plan Year by filing an election to defer
Compensation as described above within the time provided in Section 3.2,
provided that he or she is then eligible to participate in the Plan.

 

3.2           Date for Filing Election.

 

3.2.1.       Except as provided below,
an election to defer Compensation to be earned in a Plan Year shall be filed by
the Participant with the Administrator as of a date established by the
Administrator which is no later than December 31 of the Plan Year
preceding the year in which such Compensation is earned.

 

3.2.2.       In the case of an
individual first employed as an Executive or becoming a Director, or first
becoming eligible for this Plan (and any similar account-based deferred
compensation plan of the Bank) during a Plan Year, an election to defer
Compensation (which may include Incentive Compensation) earned subsequent to
the initial date of employment or eligibility and subsequent to the date of
such election may be filed by such Executive or Director with the Administrator
within thirty (30) days of such initial date of service or eligibility.

 

3.2.3.       An election to defer
Incentive Compensation meeting the requirements for “performance-based”
compensation under Treasury Regulation Section 1.409A-1(e) shall be
filed with the Administrator as of a date established by the Administrator
which is at least six months prior to the end of the performance period in
which such Incentive Compensation is earned, provided that (a) performance
criteria have been established in writing by not later than 90 days after the
commencement of the applicable performance period and the outcome is
substantially uncertain at the time the criteria are established, 

 

6

 

(b) the Participant is in employment
with the Bank continuously from the later of the beginning of the performance
period or the date such performance criteria are set, and (c) the election
is made before such performance-based compensation has become readily
ascertainable (i.e., is both calculable in
amount and substantially certain to be paid).

 

3.3           Deferral Period.  The Deferral Period for a Participant’s
Compensation earned during any Plan Year shall begin on the first day of such
Plan Year, provided that the Participant has filed an election to defer
Compensation prior thereto, as described in Section 3.2.1.  Notwithstanding the foregoing, in the case of
an individual who is first employed as an Executive or first becomes a
Director, or who first becomes eligible for participation during a Plan Year,
the Deferral Period shall begin as of the first day of the payroll period (or,
in the case of a Director, the first day of the month) beginning after the
filing of a timely election by the Participant in such Plan Year, as described
in Section 3.2.2.  In each case,
such Deferral Period shall end on the last day of the Plan Year.

 

The Deferral
Period for Incentive Compensation meeting the requirements for “performance-based”
compensation under Treasury Regulation Section 1.409A-1(e) shall be
the performance period (which shall not be shorter than a Plan Year) to which
such Incentive Compensation relates. 
Notwithstanding the foregoing, an election to defer Incentive
Compensation shall be deemed to be an election to defer such amount (1) to
the date specified in such election, or, if earlier, (2) solely in the
event of the Participant’s Termination of Service during the Deferral Period or
within 31 days after the end of the Deferral Period, to the calendar quarter
following the end of the Deferral Period for payment in an immediate lump sum
(assuming the Participant is otherwise entitled to such Incentive
Compensation).

 

3.4           Revocation or Change of Deferral Election.

 

3.4.1.       A Participant may not
voluntarily revoke or amend an election to defer Compensation under Section 3.1.1
after commencement of the Deferral Period. 
Such election shall automatically expire at the conclusion of the
applicable Deferral Period, unless renewed within the time provided in Section 3.2.

 

3.4.2.       A Participant may not
revoke or amend an election to defer Incentive Compensation meeting the
requirements for “performance-based” compensation under Treasury Regulation Section 1.409A-1(e) after
the date which is six months prior to the end of the performance period in
which such Incentive Compensation is earned; except that an election to defer
Incentive Compensation under Section 3.2.2 may not be revoked during the
Deferral Period.

 

3.4.3.       Notwithstanding the above,
if a Participant incurs a Hardship, the Participant’s Elective Deferrals under
this Plan may, upon the request of the Participant and with the consent of the
Administrator, be permanently suspended for a period of six (6) months
(the “suspension period”).  At the end of
the suspension period, the Participant’s Elective Deferrals shall automatically
resume, provided that the Participant has timely filed a deferral election
under Sections 3.1 and 3.2 with respect to the Deferral Period in effect when
the suspension period ends.

 

7

 

3.4.4.       If a Participant ceases to
be an Eligible Executive during a Deferral Period because of a change in his or
her employment status (except for a Termination of Service) as described in Section 2.3(b),
the Participant’s deferral election shall remain effective for the remainder of
the Deferral Period for which the election relates.

 

3.5           Vesting of Elective Deferrals.  A Participant shall be 100% vested in the
balance of his or her Deferred Compensation Account attributable to Elective
Deferrals at all times.

 

ARTICLE IV

BANK MATCHING
CONTRIBUTIONS

 

4.1           Matching Contributions for Eligible Executive
Participants.

 

4.1.1.       Except as provided in Section 4.1.3
below, for each Elective Deferral credited to a Participant’s Deferred
Compensation Account under Section 3.1.1, such Participant’s Account shall
also be credited with a Matching Contribution under this Plan equal to (a) the
matching contribution, if any, that would have been credited under the terms of
the Qualified Plan with respect to such amount if contributed to the Qualified
Plan, determined without regard to the Code Limitations, minus (b) the
maximum matching contribution available to the Participant under the terms of
the Qualified Plan with respect to the period to which such Elective Deferral relates,
with regard to the Code Limitations and assuming that the Participant has made
the largest elective deferral to the Qualified Plan for such period (and
preceding periods during the Deferral Period) for which a matching contribution
is available under the Qualified Plan; provided, however, that no Matching
Contribution shall be made under Sections 4.1.1 and 4.1.2 with respect to
Elective Deferrals under Section 3.1.1 exceeding 3% of Base Salary.  To the extent that a Participant has not met
applicable service requirements for participation in matching contributions
under the terms of the Qualified Plan, clause (a) of the preceding
sentence shall be applied as though the Participant is eligible for matching
contributions under the Qualified Plan; and no reduction under clause (b) of
the preceding sentence shall apply until the Participant is actually eligible
for such matching contributions.

 

4.1.2.       If, for any Plan Year
beginning on or after January 1, 2007, a Participant (a) has
contributed to the Qualified Plan the maximum amount of elective deferrals
permitted under the terms of the Qualified Plan (including “catch-up”
contributions, if available to the Participant and eligible for matching
contributions); but (b) was credited with an amount of matching
contributions under the Qualified Plan which is less than the amount set forth
in Section 4.1.1(b) above, then the Participant shall be credited
with an additional Matching Contribution under this Plan equal to the amount
set forth in Section 4.1.1(b) above for such Plan Year minus the
amount of matching contributions actually credited to the Participant under the
Qualified Plan for such Plan Year. 
Notwithstanding the foregoing, a Participant shall be eligible for a
Matching Contribution under this Section 4.1.2 only if he or she is an
Employee on the last day of the applicable Plan Year.

 

4.1.3.       For each Incentive
Compensation Elective Deferral credited to a Participant’s Deferred
Compensation Account under Section 3.1.2, such Participant’s Account shall
also be credited with a Matching Contribution under this Plan equal to the 

 

8

 

matching contribution, if any, that would be
credited under the Qualified Plan with respect to such amount if contributed to
the Qualified Plan, determined without regard to the Code Limitations and on
the basis that such Incentive Compensation is Salary under the Qualified Plan
in the year payable; provided, however, that no Matching Contribution shall be
made hereunder with respect to Elective Deferrals under Section 3.1.2
exceeding 3% of Incentive Compensation.

 

4.1.4.       No Matching Contribution
shall be made with respect to a participating Director.

 

4.2           Vesting of Matching Deferrals.  A Participant shall be 100% vested in the
balance of his or her Deferred Compensation Account attributable to Matching
Deferrals at all times.

 

ARTICLE V

INVESTMENT OF DEFERRED COMPENSATION

 

5.1           Deferred Compensation Account.  The Administrator shall establish a Deferred
Compensation Account on the books of the Plan for each Participant, reflecting
Elective Deferrals and Matching Contributions made for the Participant’s
benefit, together with any adjustments for income, gain or loss attributable
thereto under Section 5.2, and any payments, distributions, transfers or
forfeitures therefrom.  The opening
balance of the Participant’s Deferred Compensation Account as of January 1,
2007 shall equal the balance of such Account as of the close of the preceding
business day.

 

5.2           Time for Crediting Contributions.  Elective Deferrals to the Plan with respect
to any pay period, and Matching Contributions attributable to such Elective
Deferrals, shall normally be credited to the Participant’s Account within five (5) business
days of the date that corresponding contributions attributable to Compensation
earned in such pay period are credited under the Qualified Plan or would
otherwise be paid to the Participant; provided, however, that no adjustment of
earnings or losses shall be made with respect to Elective Deferrals or Matching
Contributions under Section 5.3 prior to the earlier of (a) the 15th
business day of the calendar month following the calendar month in which the
Elective Deferral would otherwise have been paid to the Participant but for the
Participant’s deferral election, or (b) the date such amounts are actually
credited to the Participant’s Account on the books of the Plan; provided,
however, that clause (a) shall not apply to any Matching Contribution made
under Section 4.1.2 or as a result of Code Limitation testing (such as ADP
testing) normally conducted on an annual basis. 
The Administrator shall establish on the books of the Plan one or more
Sub-Accounts in each Participant’s Deferred Compensation Account to reflect
such Participant’s Scheduled Distribution elections and such additional
accounts or sub-accounts as he deems necessary or advisable.

 

5.3           Hypothetical Investment of Accounts.  The Deferred Compensation Account of a
Participant, including each Sub-Account thereof, shall be adjusted as of each
Valuation Date to reflect the income, gain or loss that would accrue to such
Account, if assets in the Account were invested as described in this Section 5.3.  Each Participant shall direct the
hypothetical investment of the Elective Deferrals and Matching Contributions
credited to the Plan on his or 

 

9

 

her behalf among such
investment funds as are from time to time made available by the Committee.  A Participant may, as of any Valuation Date,
change the investment allocation of future Elective Deferrals or Matching
Contributions, and may elect to transfer all or a portion of the balance of his
or her Account hypothetically invested in one investment fund to any other
investment fund or funds then available under the Plan, by directing the
Administrator in such form and at such time as the Administrator shall require.

 

The hypothetical investment fund options available
under the Plan shall be those designated by the Committee from time to time in
its discretion.  The Administrator may
promulgate uniform and nondiscriminatory rules and procedures governing
investment elections under the Plan, including rules governing how credits
or debits to an Account or Sub-Account shall be allocated among investment
funds in the absence of a valid election.

 

5.4           Statement of Account.  A statement shall be sent to each Participant
as to the balance of his or her Deferred Compensation Account at least once
each Plan Year.  Electronic distribution
(including a reminder that such statement is available electronically) will
satisfy this requirement.

 

ARTICLE VI

PAYMENT OF DEFERRED COMPENSATION

 

6.1           Hardship Distributions.  A Participant may request that all or a
portion of his or her vested Account balance be distributed at any time by
submitting a written request to the Administrator, provided that the
Participant has incurred a Hardship, and the distribution is necessary to
alleviate such Hardship.  In determining
whether the Hardship distribution request should be approved, the Administrator
may rely on the Participant’s representation that the Hardship cannot be
alleviated:

 

6.1.1.       through reimbursement or
compensation by insurance or otherwise;

 

6.1.2.       by the Participant taking
any withdrawals then available to him or her under the terms of the Qualified
Plan;

 

6.1.3.       by reasonable liquidation
of the Participant’s assets, including amounts available for withdrawal from
the Qualified Plan, to the extent such liquidation would not itself cause a
severe financial hardship; or

 

6.1.4.       by cessation of his or her
elective deferrals under Section 3.4.3 of this Plan or a similar deferred
compensation plan to the extent available.

 

6.2           Administration of Hardship Distributions.  The Administrator shall deem a distribution
to be necessary to alleviate a Hardship if the distribution does not exceed the
amounts necessary to satisfy the Participant’s Hardship, plus amounts necessary
to pay taxes reasonably anticipated as a result of the distribution.  The Account balance that is not distributed
pursuant to the Hardship request shall remain in the Plan.  Distributions to alleviate a Hardship will be
made as soon as administratively feasible after the Administrator has reviewed
and approved the request.  An amount to
be distributed for Hardship shall be debited from the 

 

10

 

Participant’s Deferred
Compensation Account not held in a Scheduled Distribution Sub-Account, or (if
such amount is not sufficient) from the Sub-Account(s) having the latest
scheduled distribution date.

 

6.3           Scheduled Distribution.  A Participant may elect to receive a
Scheduled Distribution with respect to an Elective Deferral at the time he or
she files the applicable deferral election under Section 3.1.  A Participant may elect in accordance with Section 3.1.4
to direct all or a portion of his or her Elective Deferrals for the Plan Year
into one or more Sub-Account(s), provided that any such Sub-Account has a
scheduled distribution date which is not earlier than twelve (12) months after
the end of the Deferral Period to which the Elective Deferral relates.  The Administrator may establish uniform and
nondiscriminatory rules and procedures governing Scheduled Distribution
Sub-Accounts, including establishing limitations on the number of Sub-Accounts
available to Participants for any Deferral Period or in the aggregate, and the
minimum length of deferral to be provided under any newly-established
Sub-Account, as the Administrator deems appropriate.

 

Except to the extent the Participant elects otherwise
in accordance with Section 6.7, any “Post-Secondary Education Subaccounts”
of the Participant as in effect under the terms of the Plan immediately prior
to January 1, 2007 shall be redesignated as Scheduled Distribution Sub-Accounts
hereunder, having the same scheduled distribution date(s) and method of
distribution.

 

To the extent permitted by the Administrator at the
time of election, such election may designate whether the elected Scheduled
Distribution date shall continue to apply notwithstanding the Participant’s
intervening retirement, death, Disability or Termination of Service.  Except as otherwise elected by a Participant
under the preceding sentence, an election of a Scheduled Distribution shall
automatically terminate upon the Participant’s retirement, death, Disability or
Termination of Service, at which time the provisions of Sections 6.4, 6.5 and
6.6 shall govern distribution of the Participant’s Account.

 

A Participant may, with the consent of the
Administrator and to the extent permitted under Code Section 409A and
regulations thereunder, elect to (a) revoke a Scheduled Distribution
(provided that the Participant’s Scheduled Distribution election would
otherwise automatically terminate upon the Participant’s Termination of Service
for any reason), in which case the balance of the applicable Sub-Account will
be restored to the Participant’s Deferred Compensation Account, or (b) extend
to a later date the date on which a Scheduled Distribution will occur, in which
case the applicable Sub-Account will be redesignated or merged with another
existing Sub-Account having the same designated distribution date.  A Participant may make an election under the
preceding sentence by filing a new election prior to his or her Termination of
Service at such time and in such form as the Administrator shall
designate.  Any election to revoke or
extend the date of a Scheduled Distribution shall not take effect until at
least twelve months after the date on which it is made and must provide for a
deferred distribution date not earlier than five years after the date such
Scheduled Distribution was otherwise scheduled to be made and not later than
the date set forth in Section 6.6.

 

A Scheduled Distribution may be made in a single lump
sum payment or in installments over two to eleven years (as described in Section 6.5.1
or 6.5.2, respectively).  If a
Participant who has elected to receive a Scheduled Distribution in installment
payments incurs a 

 

11

 

Termination of Service after
payments have commenced but before all amounts held in the Scheduled
Distribution Sub-Account have been distributed, the remaining Scheduled
Distribution Account balance shall continue be paid to the Participant over the
then remaining installment period, or if the Participant has so elected, in a
single lump sum payment as soon as practicable following the Participant’s
Termination of Service.

 

6.4           Retirement, Death or Other Separation from Service.

 

6.4.1.       Initial
Distribution Election.  A
Participant who has incurred a Termination of Service, whether by reason of
retirement, voluntary or involuntary termination, death or Disability (each a “Distribution
Event”), shall receive distribution of his or her Account (other than a
Scheduled Distribution Sub-Account having a Scheduled Distribution date prior
to the date of Termination of Service or a Scheduled Distribution Sub-Account
subject to a later Scheduled Distribution date with respect to which the
Participant has elected under Section 6.3 that no intervening Distribution
Date shall apply) in a single lump sum payment as soon as practicable following
the Termination of Service. 
Notwithstanding the foregoing, the Administrator may permit a Participant
to elect a later payment commencement date permitted under Section 6.6, or
an alternate method of distribution permitted under Section 6.5, by filing
a written request with the Administrator at the time the Participant files an
initial deferral election under Section 3.2.  To the extent permitted under rules established
by the Administrator at the time of election, such an election may separately
specify different times or available methods of payment for different
Distribution Events.

 

6.4.2.       Changes
in Distribution Election. 
The Administrator may permit a Participant to defer the commencement of
his or her distribution to a date permitted under Section 6.6, or select
an alternative method of distribution permitted under Section 6.5, after
the initial deferral election by filing a written request with the
Administrator.  Such a change election
shall not take effect until at least twelve months after the date on which it
is made and shall be effective only if (a) the election is filed with the
Administrator before the Participant’s Termination of Service; (b) the
election does not accelerate the timing or payment schedule of any
distribution; (c) the payment commencement date in the change election is
not less than five years after the date the distribution would otherwise have
commenced for the Distribution Event without regard to such election; and (d) the
Administrator approves such election. 
Except as otherwise provided in Section 6.7, a Participant’s
distribution election shall become irrevocable upon the Participant’s Termination
of Service.

 

6.4.3.       Death.  If a Participant dies before distribution of
his or her Account has commenced, the Participant’s benefit under the Plan
shall be paid to his or her Beneficiary in a single lump sum payment as soon as
practicable following the Participant’s death.

 

6.4.4.       Distribution
Event.  Whether a
Participant has incurred a Distribution Event shall be determined by the
Administrator in a manner consistent with the requirements of Section 409A
and regulations thereunder.

 

12

 

6.5           Method of Payment.

 

6.5.1.       Lump Sum
Payment.  Distribution of
a Participant’s Account pursuant to Section 6.1, 6.3 or 6.4, may be made
in a cash lump sum.

 

6.5.2.       Installment
Distribution.  A
Participant requesting distribution of an Account pursuant to Sections 6.3 or
6.4 may, with the approval of the Administrator, receive distribution in
periodic payments in lieu of a lump sum. 
Periodic payments shall be paid on a semi-annual basis, in January and
July of each year, over a period that does not exceed twenty-two (22)
installments (eleven (11) years).  Each
installment payment shall be determined by dividing the Participant’s
then-current Account balance by the number of semi-annual payments remaining to
be paid. The Administrator may establish uniform and nondiscriminatory rules and
procedures governing the payment of installment distributions, including the
maximum period over which installment distributions shall be made and the
minimum amount which must be distributed each Plan Year, as the Administrator
deems appropriate consistent with Section 409A.  The entitlement to installment distributions
is treated as the entitlement to a single payment for purposes of Treasury
Regulation Section 1.409A-2(b)(2)(iii).

 

6.5.3.       Death of
Participant or Beneficiary During Installment Distribution Period.  If a Participant who has elected installment
payments under Section 6.5.2 dies after payments have commenced but before
all amounts held in the Account have been distributed, the remaining Account
balance shall be paid to the Beneficiary or Beneficiaries designated by the
Participant over the then remaining installment period, or if the Participant
has so elected, in a single lump sum payment as soon as practicable following
the Participant’s death.  If the
designated Beneficiary dies after the Participant but before all amounts held
in the Account have been distributed, the then remaining balance in the
Participant’s Account shall be distributed in a lump sum payment to the
Beneficiary’s estate as provided in Section 6.5.1 (except to the extent
that the Participant has designated one or more contingent Beneficiaries) as
soon as practicable after the Beneficiary’s death.

 

6.5.4.       Limit on
Distribution Method. 
Notwithstanding the foregoing, to the extent permitted under Section 409A,
if the Participant’s aggregate Deferred Compensation Account does not exceed
the dollar limitation on elective deferrals as then in effect under Code Section 402(g) at
the time of his or her Termination of Service or earlier Distribution Event,
distribution shall be made to the Participant (or his or her Beneficiary in the
case of the Participant’s death) in a single lump-sum payment within ninety
(90) days after such Termination of Service or earlier Distribution Event.

 

6.5.5.       General
Payment Rules.  A payment
required to be made under any provision of this Plan upon or as soon as
practicable after a designated payment date (e.g.,
date of death or Termination of Service) shall be deemed to be made upon the
date specified if it is made within the same taxable year of the Participant (i.e., the calendar year) or, if later, by the 15th
day of the third month after such designated payment date, provided that the
Participant is not permitted, directly or indirectly, to designate the taxable
year of payment.

 

13

 

6.6           Payment Commencement Date.   A Participant may not elect a distribution
date later than (a) April 1 of the calendar year after the year in
which the Participant attains age 701⁄2, or (b) five years after the
Participant’s Termination of Service, if later.

 

6.7           Transition Rule Election.  Pursuant to Internal Revenue Service Notice
2005-1, Q&A-19(c), as extended by Notice of Proposed Rulemaking REG-158080-04,
a Participant may, prior to December 31, 2008 or such later date as shall
be permitted by the Administrator in accordance with Code Section 409A,
modify or make new elections regarding distribution of his or her Account(s) under
Sections 6.3, 6.4 and 6.5, at such time and in such form as the Administrator
shall designate; provided, however, that no such distribution election made in
2007 may affect payments that the Participant would otherwise receive in 2007
or cause payments to be made in 2007, and that no such distribution election
made in 2008 may affect payments that the Participant would otherwise receive
in 2008 or cause payments to be made in 2008.

 

6.8           Acceleration of Payment Date.  Notwithstanding the foregoing,  the distribution of benefits hereunder may be
accelerated, with the consent of the Administrator, under the following
circumstances:

 

6.8.1.       Compliance
with Domestic Relations Order. 
To permit payment to an individual other than the Participant as
necessary to comply with the provisions of a domestic relations order (as
defined in Code Section 414(p)(1)(B));

 

6.8.2.       Conflicts
of Interest.  To permit
payment as necessary to comply with the provisions of a Federal government
ethics agreement or to avoid violation of an applicable Federal, state, local
or foreign ethics law or conflicts of interest law;

 

6.8.3.       Payment
of Employment Taxes.  To
permit payment of federal employment taxes under Code Sections 3101, 3121(a) or
3121(v)(2), or to comply with any federal tax withholding provisions or
corresponding withholding provisions of applicable state, local, or foreign tax
laws as a result of the payment of federal employment taxes, and to pay the
additional income tax at source on wages attributable to the pyramiding Code Section 3401
wages and taxes; or

 

6.8.4.       Tax Event.  Upon a good faith, reasonable determination
by the Administrator, and upon advice of counsel, that the Plan fails to meet
the requirements of Code Section 409A and regulations thereunder.  Such payment may not exceed the amount
required to be included in income as a result of the failure to comply with the
requirements of Code Section 409A.

 

6.9           Delay of Payments.  A payment otherwise required to be made under
the terms of the Plan may be delayed solely to the extent necessary under the
following circumstances, provided that payment is made as soon as possible
within the first calendar year after the reason for delay no longer applies:

 

6.9.1.       Payments
Subject to the Deduction Limitation.  The Bank reasonably anticipates that such
payment would otherwise violate Code Section 162(m);

 

14

 

6.9.2.       Violation
of Law.  The Administrator
reasonably determines that making the payment will violate Federal securities
or other applicable laws; or

 

6.9.3.       Other
Permitted Event. Upon such other events and conditions as the
Commissioner of Internal Revenue shall prescribe in generally applicable
guidance

 

ARTICLE VII

ADMINISTRATION OF THE PLAN

 

7.1           Administration by the Bank.  The Committee shall be responsible for the
general operation and administration of the Plan and for carrying out the
provisions thereof.  The Committee may
appoint such person or persons as it deems appropriate to perform all or any of
the functions of the Administrator under the terms of the Plan.  To the extent that no such person or persons
are appointed, the Committee shall serve as Administrator.

 

7.2           General Powers of Administration.  The Committee shall have authority and
discretion to control and manage the operation and administration of the Plan,
including all rights and powers necessary or convenient to the carrying out of
its functions hereunder, whether or not such rights and powers are specifically
enumerated herein.  The Committee may, in
its discretion, delegate authority with regard to the administration of the
Plan to any individual, officer or committee in accordance with Section 7.2.7
below.  Notwithstanding any other
provision of the Plan, if an action or direction of any person to whom
authority hereunder has been delegated conflicts with an action or direction of
the Committee, then the authority of the Committee shall supersede that of the
delegate with respect to such action or direction.

 

Without limiting the
generality of the foregoing, and in addition to the other powers set forth in
this Section 7.2, the Committee or its delegate shall have the following
express authorities:

 

7.2.1.       To construe and interpret
the provisions of the Plan; to decide all questions arising thereunder,
including, without limitation, questions of eligibility for participation,
eligibility for benefits, the validity of any election or designation made
under the Plan, and the amount, manner and time of payment of any benefits
hereunder; and to make factual determinations necessary or appropriate for such
decisions or determination;

 

7.2.2.       To prescribe procedures to
be followed by Participants, Beneficiaries or alternate payees in filing
applications for benefits and any other elections, designations and forms
required or permitted under the Plan;

 

7.2.3.       To prepare and distribute
information explaining the Plan;

 

7.2.4.       To receive from the Bank
and from Participants, Beneficiaries and alternate payees such information as
shall be necessary for the proper administration of the Plan;

 

7.2.5.       To furnish the Bank or the
Board of Directors, upon request, such reports with respect to the
administration of the Plan as are reasonable and appropriate;

 

15

 

7.2.6.       To appoint or employ advisors,
including legal and actuarial counsel (who may also be counsel to the Bank) to
render advice with regard to any responsibility of the Committee under the Plan
or to assist in the administration of the Plan;

 

7.2.7.       To designate in writing
other persons to carry out a specified part or parts of its responsibilities
hereunder (including this power to designate other persons to carry out a part
of such designated responsibility). Any such person may be removed by the
Committee at any time with or without cause;

 

7.2.8.       To rule on claims, and
to determine the validity of domestic relations orders and comply with such
orders; and

 

7.2.9.       All rules, actions,
interpretations and decisions of the Committee are conclusive and binding on
all persons, and shall be given the maximum possible deference allowed by law.

 

7.3           Rules of the Administrator.  The Administrator may adopt such rules as
it deems necessary, desirable or appropriate. When making a determination or
calculation, the Administrator shall be entitled to rely upon information
furnished by a Participant or Beneficiary, the Bank, the legal counsel of the
Bank, or such other person as it deems appropriate, and shall further be
entitled to rely conclusively upon all tables, valuations, certificates, opinions
and reports furnished by any actuary, accountant, controller, counsel or other
person employed or engaged by the Bank with respect to the Plan.

 

7.4           Claims Procedure.  Any person who believes that he or she is
then entitled to receive a benefit under the Plan may file a claim in writing
with the Administrator.  Except to the
extent the Committee adopts an alternate procedure for the review of claims,
the procedures in this Section 7.4 shall apply.  The Administrator shall, within ninety (90)
days of the receipt of a claim, either allow or deny the claim in writing.  A denial of a claim shall be written in a
manner calculated to be understood by the claimant and shall include: (a) the
specific reason or reasons for the denial; (b) specific references to
pertinent Plan provisions on which the denial is based; (c) a description
of any additional material or information necessary for the claimant to perfect
the claim and an explanation of why such material or information is necessary;
and (d) an explanation of the Plan’s claim review procedure.  A claimant whose claim is denied (or his or
her duly authorized representative) may, within sixty (60) days after receipt
of denial of the claim: (1) submit a written request for review to the
Committee; (2) review pertinent documents; and (3) submit issues and
comments in writing.  The Administrator
shall notify the claimant of the decision of the Committee on review within
sixty (60) days of receipt of a request. 
No legal action may be commenced by a Participant or Beneficiary with
respect to a benefit under this Plan without first exhausting the Plan’s
administrative claims procedures, and any legal action with respect to a claim
that has been finally denied must be commenced no later than one year after the
date of the Plan’s final denial of such claim upon appeal.

 

16

 

ARTICLE VIII

GENERAL PROVISIONS

 

8.1           Participant’s Rights Unsecured.  The right of any Participant to receive
future payments under the provisions of the Plan shall be an unsecured claim
against the general assets of the Bank. 
The Bank shall be under no obligation to establish any separate fund,
purchase any annuity contract, or in any other way make any special provision
or specifically earmark any funds for the payment of amounts called for under
the Plan.  If the Bank chooses to
establish such a fund, or purchase such an annuity contract or make any other
agreement to provide for such payments, that fund, contract or arrangement
shall remain part of the Bank’s general assets and no person claiming payments
under the Plan shall have any right, title or interest in or to any such fund,
contract or arrangement.

 

8.2           Non-assignability.  None of the benefits, payments, proceeds or
claims of any Participant or Beneficiary shall be subject to any claim of any
creditor of any Participant or Beneficiary and, in particular, the same shall
not be subject to attachment or garnishment or other legal process by any
creditor of such Participant or Beneficiary, nor shall any Participant or
Beneficiary have any right to alienate, anticipate, commute, pledge, encumber
or assign any of the benefits or payments or proceeds which he or she may
expect to receive, contingently or otherwise, under the Plan. Notwithstanding the
foregoing, the Bank shall comply with the terms of a domestic relations order
applicable to a Participant’s interest in the Plan, provided that such order
does not require the payment of benefits in a manner or amount, or at a time,
inconsistent with the terms of the Plan. 
The Bank shall have no liability to any Participant or Beneficiary to
the extent that his or her benefit is reduced in accordance with the terms of a
domestic relations order that the Bank applies in good faith.

 

8.3           Taxes. 
The Administrator shall withhold all federal, state or local taxes that
it reasonably believes are required to be withheld from any payments under the
Plan.

 

8.4           Limitation of Participant’s Rights.  Nothing contained in the Plan shall confer
upon any person a right to be employed or to continue in the employ of the
Bank, or interfere in any way with the right of the Bank to terminate the
employment of a Participant at any time, with or without cause.

 

8.5           Receipt and Release.  Any payment to any Participant or Beneficiary
in accordance with the provisions of the Plan shall, to the extent thereof, be
in full satisfaction of all claims against the Bank or the Plan, and the
Administrator may require such Participant or Beneficiary, as a condition
precedent to such payment, to execute a receipt and release to such
effect.  If any Participant or
Beneficiary is determined by the Administrator to be incompetent by reason of
physical or mental disability (including minority) to give a valid receipt and
release, the Administrator may cause the payment or payments becoming due to
such person to be made to another person for his or her benefit without
responsibility on the part of the Administrator or the Bank to follow the
application of such funds.

 

8.6           Governing Law.  The Plan shall be construed, administered,
and governed in all respects under and by the laws of the Commonwealth of
Massachusetts.  If any provision shall 

 

17

 

be held by a court of competent
jurisdiction to be invalid or unenforceable, the remaining provisions hereof
shall continue to be fully effective.

 

8.7           Designation of Beneficiary.  A Participant may designate a Beneficiary by
so notifying the Administrator in writing, in a form acceptable to the
Administrator, at any time before the Participant’s death.  A Participant may revoke any Beneficiary
designation or designate a new Beneficiary at any time without the consent of a
beneficiary or any other person.  If no
Beneficiary is designated or no designated Beneficiary survives the
Participant, payment shall be made in a single lump sum to the Participant’s
estate.

 

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

 

8.9           Indemnification.  No Committee member shall be personally
liable by reason of any instrument executed by him or on his behalf, or action
taken by him, in his capacity as a Committee member nor for any mistake of
judgment made in good faith.  The Bank
shall indemnify and hold harmless the Plan and each Committee member and each
employee, officer or director of the Bank or the Plan, to whom any duty, power,
function or action in respect of the Plan may be delegated or assigned, or from
whom any information is requested for Plan purposes, against any cost or
expense (including fees of legal counsel) and liability (including any sum paid
in settlement of a claim or legal action with the approval of the Bank) arising
out of anything done or omitted to be done in connection with the Plan, unless
arising out of such person’s fraud or bad faith.

 

8.10         Headings and Subheadings.  Headings and subheading in this Plan are
inserted for convenience only and are not to be considered in the construction
of the provisions hereof.

 

8.11         Amendment and Termination.  The Plan may at any time or from time to time
be amended, modified, or terminated by the Board of Directors.  No amendment, modification, or termination
shall, without the consent of a Participant, adversely affect the Participant’s
Deferred Compensation Account at that time. 
Upon termination of the Plan, the Board of Directors may elect to (a) pay
benefits hereunder as they become due as if the Plan had not terminated or (b) to
extent permitted by Code Section 409A and regulations thereunder, direct
that all payments remaining to be made under the Plan be made in a single lump
sum to Participants (or their Beneficiaries).

 

18

 

8.12         Effective Date.  Except as otherwise provided herein, the
effective date of this Plan shall be January 1, 2008.

 

IN WITNESS WHEREOF, and pursuant
to adoption of this Plan Document by the Board of Directors of the Bank has
caused this Plan Document to be executed this fifth day of August, 2008 by:

 

 

	
  /s/Janelle K. Authur

  	
   

  	
  /s/Ellen McLaughlin

  
	
  Senior Vice President/Executive Director of

  	
   

  	
  Senior Vice President/General Counsel

  
	
  Human Resources

  	
   

  	
   

  

 

19Exhibit 10.2.4

 

THE FEDERAL HOME LOAN BANK OF BOSTON

PENSION BENEFIT EQUALIZATION PLAN

 

Federal Home Loan Bank of Boston (the “Bank”) adopted
the Federal Home Loan Bank of Boston Pension Benefit Equalization Plan (the “Plan”),
as a component of the Federal Home Loan Bank of Boston Benefit Equalization
Plan, effective January 1, 1993. 
The Plan is herein amended and restated in order to comply with Code Section 409A,
as enacted by the American Jobs Creation Act of 2004 and applicable regulations
thereunder.  This amendment and
restatement shall be effective January 1, 2008; provided, however, that
any provision required to be effective on and after January 1, 2005 in
order for the Plan to comply with Code Section 409A shall become effective
as of January 1, 2005 (or such later date as shall be permitted under
applicable Code Section 409A transition rules); and provided further, that
if the application of any amended or restated provision below to a Member’s
Grandfathered Supplemental Benefit (as defined below) would constitute a “material
modification” for purposes of Treasury Regulation Section 1.409A-6(a)(4),
the corresponding provision of the Prior Plan shall apply in lieu of such
amended or restated provision.

 

The Plan is established and maintained by the Bank in
order to provide designated Eligible Executives with the benefits which would
have been provided under the Pentegra Defined Benefit Plan for Financial
Institutions (the “Qualified Plan”) if (a) their benefits under the
Qualified Plan were not limited by certain limitations imposed by the Internal
Revenue Code applicable to the Qualified Plan; (b) “Salary” as defined in
the Qualified Plan took into account amounts paid under the Bank’s incentive
compensation plan(s) and elective deferrals to the Federal Home Loan Bank
of Boston Thrift Benefit Equalization Plan; and (c) certain benefit
adjustments were provided to Executive Officers as described herein.

 

The Plan is a governmental plan under Section 4(b) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and
is therefore exempt from coverage under ERISA. 
The Plan is unfunded and maintained primarily for the purpose of
providing deferred compensation to a select group of management or highly
compensated employees, and is not intended to be qualified under Section 401(a) of
the Internal Revenue Code.

 

SECTION 1 - DEFINITIONS

 

Each word used herein not defined below that begins
with a capital letter and is defined in the Qualified Plan shall have the same
definition as the definition given to that word in the Qualified Plan.  Wherever used herein, the following terms
shall have the meanings hereinafter set forth:

 

1.1           “Administrator” means the Committee
or such person or persons as may be appointed by the Committee to be responsible
for those functions assigned to the Administrator under the Plan.

 

 

1.2           “Affiliate” means any entity that is
a member of a “controlled group” of corporations with the Bank under Code Section 414(b) or
a trade or business under common control with the Bank under Code Section 414(c);
provided, however, that in applying Code Sections 1563(a)(1), (2) and (3) for
purposes of Code Section 414(b), the language “at least 50 percent” will
be used instead of “at least 80 percent” each place it appears, and in applying
Treasury Regulation Section 1.414(c)-2 for purposes of Code Section 414(c),
the language “at least 50 percent” will be used instead of “at least 80 percent”
each place it appears.  In addition, to
the extent that the Administrator determines that legitimate business criteria
exist to use a reduced ownership percentage to determine whether an entity is
an Affiliate for purposes of determining whether a Termination of Employment
has occurred, the Administrator may designate an entity that would meet the
definition of “Affiliate” substituting 20 percent in place of 50 percent in the
preceding sentence as an Affiliate in Appendix A hereto.  Such designation shall be made by December 31,
2008 or, if later, at the time a 20 percent or more ownership interest in such
entity is acquired.

 

1.3           “Bank” means the Federal Home Loan
Bank of Boston.

 

1.4           “Beneficiary” means the person,
persons or trust designated by a Member as direct or contingent beneficiary in
the manner prescribed by the Administrator. 
The Beneficiary of a Member who has not effectively designated a
beneficiary shall be his or her estate.

 

1.5           “Board of Directors” means the Board
of Directors of the Bank.

 

1.6           “Code” means the Internal Revenue
Code of 1986, as amended from time to time, or any successor thereto.

 

1.7           “Code Limitations” means (a) the
cap on compensation taken into account by the Qualified Plan under Code Section 401(a)(17);
and (b) the overall limitation on benefits imposed by Code Section 415(b),
as such provisions may be amended from time to time, and any similar successor
provisions of federal tax law.

 

1.8           “Committee” means the Personnel
Committee of the Board of Directors, which is authorized to perform the
functions described in Article V.

 

1.9           “Disability” means that the Member (a) is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months; (b) is, by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than 3 months under an accident
and health plan covering employees of the Bank; or (c) has been determined
to be totally disabled by the Social Security Administration.  Notwithstanding the foregoing, whether a
Member has incurred a Disability with respect to his or her Grandfathered
Supplemental Benefit shall be determined under the provisions of the Prior
Plan.

 

2

 

1.10         “Effective Date” means January 1,
2008.  The Plan was initially effective January 1,
1993 and was restated effective January 1, 1997.  Any provision of this amendment and
restatement required to be effective on and after January 1, 2005 in order
for the Plan to comply with Code Section 409A shall become effective as of
January 1, 2005 (or such later date up to January 1, 2008 as shall be
permitted under applicable Code Section 409A transition rules).

 

1.11         “Eligible Executive” or “Executive” means an employee of the
Bank who is a corporate officer and (a) is eligible to participate in the
Thrift BEP, or (b) has been selected to be an Eligible Executive by the
Committee.

 

1.12         “Executive Officer” means an
Eligible Executive who is designated as an Executive Officer by the Board of
Directors or the Committee.

 

1.13         “Grandfathered Supplemental Benefit”
means, for any Member in the Plan on or before December 31, 2004, the
present value of the amount to which the Member would have been entitled under
the Plan if he or she had voluntarily terminated service without cause on December 31,
2004 (or his or her earlier termination of employment), and received a payment
of the benefits available from the Plan on the earliest possible date allowed
under the Plan in the form with the maximum value.  Notwithstanding the foregoing, for any
subsequent Plan Year, the Grandfathered Supplemental Benefit may increase to
equal the present value of the benefit the Member actually becomes entitled to,
in the form and at the time actually paid, determined under the terms of the
Plan (including applicable Code limits), as in effect on October 3, 2004,
without regard to any further services rendered by the service provider after December 31,
2004, or any other events affecting the amount of or the entitlement to
benefits (other than the Member’s election with respect to the time or form of
an available benefit).  For purposes of
calculating the present value of the Grandfathered Supplemental Benefit,
reasonable actuarial assumptions and methods must be used.  The Grandfathered Supplemental Benefit shall
be calculated in accordance with the rules and regulations promulgated
under Code Section 409A in order to treat the greatest proportion of
accrued benefit possible as not subject to Section 409A because it was
vested and accrued prior to January 1, 2005.

 

1.14         “Incentive Compensation” means
annual bonus under the Bank’s Executive Incentive Plan and, if applicable, any
long-term incentive compensation payable to a Member under the Bank’s incentive
compensation plan(s).

 

1.15         “Member” means a participant in this
Plan, unless it is clear from the context that participation in the Qualified
Plan is referenced.

 

1.16         “Non-Grandfathered Supplemental Benefit”
means the amount of the Member’s accrued benefit under the Plan, other than his
or her Grandfathered Supplemental Benefit, if any.

 

1.17         “Pension Commencement Date” means
the first day of the first period for which a Supplemental Benefit is paid as
an annuity or lump sum.  The Pension
Commencement Date is determined separately for Grandfathered and
Non-Grandfathered Supplemental Benefits.

 

3

 

1.18         “Plan” means The Federal Home Loan
Bank of Boston Pension Benefit Equalization Plan, as set forth herein or as it
may be amended or restated from time to time.

 

1.19         “Plan Year” means the calendar year.

 

1.20         “Prior Plan” means the Plan as in
effect on October 3, 2004.

 

1.21         “Qualified Plan” means the Pentegra
Defined Benefit Plan for Financial Institutions, as from time to time
amended.  Any reference to a section of
the Qualified Plan herein shall be deemed to refer to any successor provision
of the Qualified Plan which may govern the subject matter of the referenced
section in the future.

 

1.22         “Qualified Plan Retirement Benefit”
means the benefit payable to a Member pursuant to the Qualified Plan.

 

1.23         “Qualified Plan Survivor Benefit”
means the death benefit payable under the Qualified Plan upon the death of a
Member prior to his or her Pension Commencement Date, including (if applicable)
any “Active Service Death Benefit” (as described in Article V, Section 4,
of the Qualified Plan).

 

1.24         “Supplemental Benefit” means a
Supplemental Retirement Benefit or Supplemental Survivor Benefit payable under
the terms of the Plan.

 

1.25         “Supplemental Retirement Benefit”
means the benefit payable to a Plan Member pursuant to the Plan.

 

1.26         “Supplemental Survivor Benefit”
means the benefit payable under the Plan with respect to the death of a Member
prior to the Pension Commencement Date.

 

1.27         “Thrift BEP” means the Federal Home
Loan Bank of Boston Thrift Benefit Equalization Plan, as it may be amended or
restated from time to time.

 

1.28         “Termination of Employment” means
the severing of employment with the Bank and any Affiliates, voluntarily or
involuntarily, for any reason.  A
Termination of Employment will be deemed to have occurred if the facts and
circumstances indicate that the Bank and the Member reasonably anticipate that
no further services will be performed after a certain date or that the level of
bona fide services the Member will
perform for the Bank and its Affiliates after such date (whether as an employee
or as an independent contractor) will permanently decrease to no more than 20%
of the average level of bona fide
services performed (whether as an employee or an independent contractor) over
the immediately preceding 36-month period (or the full period of services to
the employer if the Member has been providing services to the Bank and its
Affiliates less than 36 months).  A
Member will not be deemed to have incurred a Termination of Employment while he
or she is on military leave, sick leave, or other bona fide leave of absence (such as temporary employment by
the government) if the period of such leave does not exceed six months or such
longer period as the Member’s right to reemployment with the Bank is provided
either by statute or by contract.  For
this purpose, a leave of absence is bona fide only if there is a reasonable expectation that the
Member will return

 

4

 

to employment at the
conclusion of the leave.  If the period
of leave exceeds six months and the Member’s right to reemployment is not
provided either by statute or by contract, the Termination of Employment will
be deemed to occur on the first date immediately following such six-month
period.  Whether a Member incurs a
Termination of Employment will be determined in accordance with the
requirements of Code Section 409A.

 

Words in the masculine gender shall include the
feminine and the singular shall include the plural, and vice versa, unless
qualified by the context.  Any headings
used herein are included for ease of reference only and are not to be construed
so as to alter the terms hereof.

 

SECTION 2 - ELIGIBILITY
AND PARTICIPATION

 

2.1           Participation.  Each Member of the Plan on December 31,
2007 will continue as a Member on the effective date of the amendment and
restatement of this Plan and thereafter to the extent eligible.  Each other Eligible Executive who is a
participant in the Qualified Plan shall become a Member on the earlier of (a) the
effective date of the Eligible Executive’s election to participate in the
Thrift BEP or January 1, 2008, if later; or (b) the effective date as
of which he or she is designated as a Member in the Plan by the Committee.  Within thirty (30) days of becoming a Member
(or a participant in any similar non-account balance, non-qualified deferred
compensation plan maintained by the Bank), the Member shall file an election
with the Administrator designating how his or her Supplemental Benefit shall be
paid.  If an Eligible Executive became a
Member under clause (a) above and is subsequently designated as eligible
for enhanced benefits under clause (b) above, the distribution election
made in connection with his or her initial participation shall continue to
apply.  The Surviving Spouse of a Member
described above who dies prior to the Member’s Pension Commencement Date shall
be eligible to receive a Supplemental Survivor Benefit, as set forth below.

 

2.2           Elections under Section 409A Transition Rules.  Pursuant to Internal Revenue Service (“IRS”)
Notice 2005-1, Q&A-19(c), as extended by Notice of Proposed Rulemaking
REG-158080-04 and IRS Notice 2007—86, a Member who (a) has not incurred a
Termination of Employment or (b) has incurred a Termination of Employment
but has neither entered pay status under the Plan nor had an annuity purchased
in connection with his or her benefits under the Plan, may, in 2008, modify or
make a new election regarding distribution of his or her Non-Grandfathered Supplemental
Benefit at such time and in such form as the Administrator shall designate;
provided, however, that no such distribution election made in 2008 may affect
payments that the Member would otherwise receive in 2008 or cause payments to
be made in 2008.  In addition, pursuant
to Internal Revenue Service Notice 2005-1, Q&A-23, as extended, in the case
of a distribution commencing on or before December 31, 2008 (or such later
date as shall be permitted by the Administrator consistent with Code Section 409A
and regulations thereunder), an election as to the time and form of payment of
the Member’s benefit under the Qualified Plan shall govern distribution of the
Member’s Non-Grandfathered Supplemental Benefit under this Plan, to the extent
provided under the terms of the Prior Plan.

 

2.3           Cessation of Participation.  An Executive shall cease to be a Member in
the Plan if (a) he or she incurs a Termination of Employment for any
reason, (b) he or she remains in the service of a Bank but ceases to be an
Eligible Executive as described in Section 1.11 due to a

 

5

 

change in
employment status, except to the extent that the Committee determines
otherwise, or (c) the Plan is terminated or otherwise amended so that the
Executive ceases to be eligible for participation; provided, however, that such
individual shall continue to be a Member solely with respect to his or her
benefits accrued through the date of such cessation, to the extent that such
benefits are or become vested prior to the Member’s Termination of
Employment.  Such cessation of
participation shall be effective upon the date of the change in status
described in clause (a) or (b) above, or upon the effective date of
an amendment or termination of the Plan described in clause (c) above.

 

2.4           Vesting.  A Member (or his or her Beneficiary, as the
case may be) shall be or become vested in his or her Supplemental Benefit as
and to the same extent that he or she is vested under the terms of the
Qualified Plan.

 

SECTION 3 - SUPPLEMENTAL
RETIREMENT BENEFIT

 

3.1           Amount.  The Supplemental Retirement Benefit payable
to a Member on or after his or her Normal Retirement Date shall be a monthly
amount equal to the difference between either (a) or (b) below, as
applicable, minus (c) below, adjusted as determined in accordance with Section 3.2
or 3.3, as applicable, where:

 

(a)           in
the case of an Eligible Executive described in clause (a) of Section 1.11
who becomes a Member under clause (a) of Section 2.1 as a result of
participation in the Thrift BEP, the monthly amount of the Qualified Plan
Retirement Benefit to which the Member would have been entitled under the terms
of the Qualified Plan if such benefit were computed by including in the
definition of “Salary” any amounts voluntarily deferred by the Member under the
Thrift BEP; or

 

(b)           in
the case of an Eligible Executive described in clause (b) of Section 1.11
who becomes a Member under clause (b) of Section 2.1, the monthly
amount of the Qualified Plan Retirement Benefit to which the Member would have
been entitled under the terms of the Qualified Plan if such benefit were
computed:

 

(i)            including in the definition of “Salary” any
amounts voluntarily deferred by the Member under the Thrift BEP;

 

(ii)           without regard to Code Limitations;

 

(iii)          including in the definition of “Salary” any
Incentive Compensation paid during the applicable Plan Year (determined prior
to any deferral under the Thrift BEP);

 

(iv)          by recognizing the Member’s years of service
from his or her initial date of employment with any employer participating in
the Qualified Plan to his or her date of membership in the Qualified Plan as
benefit service under the Qualified Plan; and

 

6

 

(v)           solely with respect to
Executive Officers hired by the Bank prior to January 9, 2006 and
appointed as an Executive Officer effective on or prior to January 1,
2008, by applying an increased annual pension accrual rate of two and
three-eighths percent (2.375%); provided, however, that aggregate pension
benefits payable to such Executive Officers (taking into account benefits
determined under this Plan and the Qualified Plan, and from any other defined
benefit pension plan in which the Member participated during any period of
service taken into account in calculating the Member’s benefit hereunder) shall
not exceed a percentage of the Member’s “High-3 Salary” (taking into account
compensation described in clauses (i), (ii) and (iii) above) equal to
sixty-five percent (65%) for Senior Vice Presidents, seventy percent (70%) for
Executive Vice Presidents and eighty percent (80%) for the President;

 

MINUS

 

(c)           the monthly amount of the Qualified Plan
Retirement Benefit payable to the Plan Member under the terms of the Qualified
Plan.

 

Notwithstanding the foregoing, the amount of a Member’s Supplemental
Retirement Benefit shall not be less than zero. 
Subject to Section 6.1 and the provisions of Code Section 409A,
the method for calculating a Member’s Non-Grandfathered Supplemental Benefit may
be modified from time to time in an offer letter or employment agreement
approved by the Committee and accepted by the Member, or other writing
specifically approved by the Committee and making specific reference to this
Plan.

 

3.2           Adjustment and Payment of Grandfathered
Supplemental Retirement Benefits.  The amount of Grandfathered Supplemental
Retirement Benefit to which a Member may be entitled, if any, shall be
determined under the terms of the Prior Plan, and shall be subject to such
adjustments to reflect the time and method of payment, and any “Active Service
Death Benefit” (as defined in Article V, Section 4 (or successor
provision) of the Qualified Plan), “Retirement Adjustment Payment” (as defined
in Article V, Section 5 (or successor provision) of the Qualified
Plan), or “Annual Increment” (as defined in Article V, Section 6(A) (or
successor provision) of the Qualified Plan) as may apply under the terms of the
Prior Plan and are both earned and vested prior to January 1, 2005.  An ad hoc cost of living
adjustment (referred to as a “Single Purchase Fixed Percentage Adjustment” as
defined in Article V, Section 6(B) (or successor provision) of
the Qualified Plan) applicable under the Qualified Plan shall be taken into
account solely to the extent provided by the Administrator consistent with Code
Section 409A.  Under Section 3.02(a) of
the Prior Plan, if a Member’s Grandfathered Supplemental Retirement Benefit is
not paid in the “Regular Form” under the Qualified Plan, the benefit payable in
an optional form shall be of equivalent actuarial value to the benefit
otherwise payable in the Regular Form, determined using the same actuarial
factors and assumptions then used to determine actuarial equivalence under the
Qualified Plan.  Except as otherwise provided
in Section 7.3, Grandfathered Supplemental Retirement Benefits to which a
Member may be entitled, if any, shall be paid in accordance with the terms of
the Prior Plan.  Under Section 3.02(a) of
the Prior Plan, such benefit shall be paid in the same form as elected by the
Member under the Qualified Plan; provided, however, that an election to receive
a lump sum payment

 

7

 

under the Plan must be filed at least twelve (12) calendar months prior
to the Member’s retirement.

 

3.3           Adjustment of Non-Grandfathered Supplemental
Retirement Benefits.  The
amount of Non-Grandfathered Supplemental Retirement Benefit described in Section 3.1
above shall be calculated based upon the Member’s Qualified Plan Retirement Benefit
determined as of the earlier of (a) the Member’s actual “Commencement Date”
under the Qualified Plan, or (b) the Member’s Pension Commencement Date
under this Plan (including the Pension Commencement Date of any Grandfathered
Supplemental Benefit).  To the extent
that the Member’s Commencement Date under the Qualified Plan is used as the
calculation date, the Member’s Non-Grandfathered Supplemental Retirement
Benefit payable upon the Pension Commencement Date shall be (i) the amount
determined under Section 3.1 (including for this purpose any Grandfathered
Supplemental Retirement Benefit) with regard to any early retirement factors
applied at such calculation date under the Qualified Plan, (ii) reduced by
any Grandfathered Supplemental Retirement Benefit (calculated under Section 3.2
assuming payment commencement as of the same date), (iii) with such
resulting Non-Grandfathered Supplemental Retirement Benefit converted to the
Qualified Plan normal form of benefit commencing at the Member’s Normal Retirement
Date based upon the early retirement factors set forth in the Qualified
Plan.  The Member’s resulting
Non-Grandfathered Supplemental Retirement Benefit calculated under the
preceding sentence shall be adjusted as determined by the Administrator through
the Pension Commencement Date to take into account an allocable portion of any
Retirement Adjustment Payment (as defined in Article V, Section 5 (or
successor provision) of the Qualified Plan) or Post-Retirement Supplement (as
defined in Article V, Section 6 (or successor provision) of the
Qualified Plan) applicable under the Qualified Plan between the “Commencement
Date” and the Pension Commencement Date under this Plan.

 

To the extent that the Member’s Pension Commencement
Date under this Plan is used as the calculation date (i.e.,
the Pension Commencement Date under this Plan is prior to the Qualified Plan
Commencement Date), the Member’s Non-Grandfathered Supplemental Retirement
Benefit payable upon the Pension Commencement Date shall be the amount determined
under Section 3.1 as though the Member has elected to receive payment of
his or her Qualified Plan benefit as of the same date, reduced by any
Grandfathered Supplemental Retirement Benefit (calculated as described in Section 3.2
assuming payment commencement as of the same date).

 

The Member’s Non-Grandfathered Supplemental Retirement
Benefit shall be adjusted as provided under the terms of the Qualified Plan, to
the extent applicable, to reflect commencement of payments prior to the Member’s
Normal Retirement Date or payment in a form of benefit other than a life
annuity (as described in Article VII, Section 1 (or successor
provision) of the Qualified Plan, with regard to “Additional Death Benefits”
applicable under Article V, Section 4 (or successor provision) of the
Qualified Plan).  In determining the
amount of any optional form of benefit, the factors set forth in the Qualified
Plan shall apply.  The Member’s
Non-Grandfathered Supplemental Retirement Benefit in pay status in annuity form
shall be further adjusted to reflect any Retirement Adjustment Payment and/or
Annual Increment which becomes effective after the Pension Commencement
Date.  A Single Purchase Fixed Percentage
Adjustment after the Pension Commencement Date shall apply to Non-Grandfathered

 

8

 

Supplemental Retirement Benefits in pay status solely to the extent
provided by the Board of Directors consistent with Code Section 409A.  If a Member elects a lump sum distribution
hereunder, no Single Purchase Fixed Percentage Adjustment shall apply.

 

3.4           Payment of Non-Grandfathered Supplemental
Retirement Benefits. 
Except as otherwise provided in Section 7.3 or in the last sentence
of Section 2.2, a Member may elect to receive payment of his or her
Non-Grandfathered Supplemental Retirement Benefit in such distribution form as
is then available to the Member under the Qualified Plan upon Termination of
Employment.  An election under this Section 3.4
shall be made in a writing acceptable to the Administrator and filed with the
Administrator within the thirty (30) day period set forth in Section 2.1
or, if later, within the transition election period set forth in Section 2.2.  Such election may specify a payment
commencement date which is no earlier than as soon as practicable following the
later of Termination of Employment or attainment of age forty-five (45) (except
in the case of a Disability Retirement Benefit described below), and no later
than the Member’s Normal Retirement Date (or his or her actual retirement date,
if later).  To the extent permitted by
the Administrator consistent with Code Section 409A and regulations
thereunder, a Member may elect a different available method of distribution
with respect to different events resulting in Termination of Employment (e.g., retirement, death or Disability).

 

If a Member fails to file an election of method of
distribution for his or her Non-Grandfathered Supplemental Retirement Benefit
within the time provided in Section 2.1 or 2.2, he or she shall be deemed
to have elected to have such benefit paid as (i) a qualified joint and 50%
survivor annuity if the Member is married on the Pension Commencement Date, or (ii) as
a life annuity for the life of the Member (as described in Article VII, Section 1
(or successor provision) of the Qualified Plan, with regard to “Additional
Death Benefits” applicable under Article V, Section 4 (or successor
provision) of the Qualified Plan) if he or she is not married on the Pension
Commencement Date, in either case commencing on or as soon as practicable after
the first day of the month following the later of the Member’s Termination of
Employment or, if later, his or her attainment of age forty-five (45).  Notwithstanding the foregoing, the following rules apply
to Non-Grandfathered Supplemental Retirement Benefit distribution elections
under the Plan:

 

(a)           If the Member’s Termination of Employment is
due to Disability, the Member shall be deemed to have elected to have annuity
payments commence on the first day of the month following the Administrator’s
determination of such Disability.

 

(i)            If the Member ceases to be entitled to a
Disability Retirement Benefit under the Qualified Plan prior to age 45, his or
her Non-Grandfathered Supplemental Retirement Pension shall cease if and when
the Member ceases to be eligible for a Disability Retirement Benefit under the
terms of the Qualified Plan and shall recommence in annuity form (as described
above) upon the Member’s attainment of age forty-five (45), reduced to the Non-Grandfathered
Supplemental Retirement Benefit amount that would otherwise have been payable
as of such Pension Commencement Date.

 

9

 

(ii)           If the Member ceases to
be entitled to a Disability Retirement Benefit under the Qualified Plan at or
after age 45, the Member’s Non-Grandfathered Supplemental Retirement Benefit
shall be reduced to the Non-Grandfathered Supplemental Retirement Benefit
amount that would otherwise have been payable to the Member, assuming that the
Member’s Pension Commencement Date is the date of such cessation of disability.

 

(iii)          If the Member returns to employment with the
Bank upon or after cessation of his or her disability, any additional benefit
that may become payable under the Plan shall be determined and paid upon the
Member’s subsequent Termination of Employment in accordance with Section 3.5(b) below.

 

(b)           If
a Member is reemployed by the Bank while receiving annuity benefits under the
Plan, the Member’s Non-Grandfathered Supplemental Retirement Benefit shall not
be suspended hereunder.  Upon the Member’s
subsequent Termination of Employment, the Member’s Non-Grandfathered
Supplemental Retirement Benefit then in pay status shall be adjusted to reflect
any additional benefit accruals that the Member earns under the terms of the
Plan during his period of reemployment, with such additional benefit accruals
reduced (but not below zero) by the value of any benefit payments made during
the period of reemployment.  Any increase
in Non-Grandfathered Supplemental Retirement Benefit shall be paid in
accordance with the distribution method then in effect for the Member
commencing as soon as practicable after the Member’s subsequent Termination of
Employment.

 

(c)           The
entitlement to a life annuity (including any joint and survivor annuity or
annuity with term certain) is treated as the entitlement to a single payment
for purposes of Code Section 409A. 
To the extent permitted under Code Section 409A and permitted by
the Administrator, a Member may change the form of distribution  from one type of life annuity to another type
of life annuity before the Pension Commencement Date, provided that the
annuities are actuarially equivalent applying reasonable actuarial
assumptions.  A payment required to be
made under the Plan upon or as soon as practicable after a designated payment
date shall be deemed to be made upon the date specified if it is made within
the same taxable year of the Member (i.e., the
calendar year) or, if later, by the 15th day of the third month
after such designated payment date, provided that the Member is not permitted,
directly or indirectly, to designate the taxable year of payment.

 

3.5           Change in
Distribution Election for Non-Grandfathered Supplemental Benefits.  To the extent permitted by the Administrator
and consistent with Code Section 409A and regulations thereunder, a Member
may elect to change the method or time of distribution of his or her Non-Grandfathered
Supplemental Retirement Benefit after the initial deferral election and before
the Pension Commencement Date by filing a written request with the
Administrator.  Except in the case of a
transition election permitted under Section 2.2 above, such a change
election shall not take effect until at least twelve months after the date on
which it is made and shall be effective only if (a) the election is filed
with the Administrator before the Member’s 

 

10

 

Termination of Employment; (b) the election does not accelerate
the timing or payment schedule of any distribution; (c) the payment
commencement date in the change election is not less than five years after the
date the distribution would otherwise have commenced for the event resulting in
Termination of Employment without regard to such election, and not later than
five years after his or her Normal Retirement Date or Postponed Retirement
Date, as applicable; and (d) the Administrator approves such election.  A Member’s distribution election shall become
irrevocable upon the Member’s Termination of Employment.  Notwithstanding the foregoing, a  Member may not elect a distribution date
later than (a) April 1 of the calendar year after the year in which
the Member attains age 701⁄2, or (b) five years after the Member’s
Termination of Employment, if later.

 

3.6           General
Conditions of Payment. 
All terms and conditions of the Prior Plan applicable to the payment of
Supplemental Retirement Benefits shall govern the payment of Grandfathered
Supplemental Retirement Benefits, including the suspension of benefits
provisions in Section 3.04 of the Prior Plan.  Except as otherwise expressly provided herein
or as required by Code Section 409A, all terms and conditions of the
Qualified Plan applicable to payment of a Qualified Plan Retirement Benefit or
a Qualified Plan Survivor Benefit shall also be applicable to a
Non-Grandfathered Supplemental Benefit payable hereunder.  Any Qualified Plan Retirement Benefit, Qualified
Plan Survivor Benefit or other benefit payable under the Qualified Plan shall
be paid solely in accordance with the terms and conditions of the Qualified
Plan, and nothing in this Plan shall operate or be construed in any way to
modify, amend or affect the terms and provisions of the Qualified Plan.

 

3.7           Death
after Pension Commencement Date of Supplemental Retirement Benefits.  If a Member dies
after the date the Pension Commencement Date of Supplemental Retirement
Benefits, the only death benefit payable under the Plan in respect of such
Member shall be the amount, if any, payable under the form of payment which the
Participant had elected.

 

3.8           Acceleration
of Payment Date. 
Notwithstanding the foregoing, 
the distribution of Non-Grandfathered Supplemental Benefits hereunder
may be accelerated, with the consent of the Administrator, under the following
circumstances:

 

(a)           Compliance with Domestic
Relations Order.  To
permit payment to an individual other than the Member as necessary to comply
with the provisions of a domestic relations order (as defined in Code Section 414(p)(1)(B));

 

(b)           Conflicts of Interest.  To permit payment as necessary to comply with
the provisions of a Federal government ethics agreement or to avoid violation
of an applicable Federal, state, local or foreign ethics law or conflicts of
interest law;

 

(c)           Payment of Employment Taxes.  To permit payment of federal employment taxes
under Code Sections 3101, 3121(a) or 3121(v)(2), or to comply with any
federal tax withholding provisions or corresponding withholding provisions of
applicable state, local, or foreign tax laws as a result of the payment of
federal employment taxes, and to pay the additional income tax at source on
wages attributable to the pyramiding Code Section 3401 wages and taxes; or

 

11

 

(d)           Tax Event.  Upon a good faith, reasonable determination
by the Administrator, and upon advice of counsel, that the Plan fails to meet
the requirements of Code Section 409A and regulations thereunder.  Such payment may not exceed the amount
required to be included in income as a result of the failure to comply with the
requirements of Code Section 409A.

 

3.9           Delay of
Payments.  A payment of
Non-Grandfathered Supplemental Benefits otherwise required to be made under the
terms of the Plan may be delayed solely to the extent necessary under the
following circumstances, provided that payment is made as soon as possible
within the first calendar year after the reason for delay no longer applies:

 

(a)           Payments Subject to the
Deduction Limitation. 
The Bank reasonably anticipates that such payment would otherwise
violate Code Section 162(m);

 

(b)           Violation of Law.  The Administrator reasonably determines that
making the payment will violate Federal securities or other applicable laws; or

 

(c)           Other Permitted Event.
Upon such other events and conditions as the Commissioner of Internal Revenue
shall prescribe in generally applicable guidance.

 

This Section 3.9 shall be applied to
similarly-situated Members in a reasonably consistent basis.

 

SECTION 4 - SUPPLEMENTAL
SURVIVOR BENEFIT

 

4.1           Amount.  If a Member dies prior to his or her Pension
Commencement Date under circumstances in which a Qualified Plan Survivor
Benefit is payable, then a Supplemental Survivor Benefit may be payable to his
or her Beneficiary as hereinafter provided. 
The monthly amount of the Supplemental Survivor Benefit shall be equal
to the difference between either (a) or (b) below, as applicable,
minus (c) below, where:

 

(a)           in the case of an Eligible Executive
described in Section 1.11(a) who becomes a Member under Section 2.1(a) as
a result of participation in the Thrift BEP, the monthly amount of the
Qualified Plan Survivor Benefit to which the Member would have been entitled under
the terms of the Qualified Plan if such benefit were computed by including in
the definition of “Salary” any amounts voluntarily deferred by the Member under
the Thrift BEP; or

 

(b)           in the case of an Eligible Executive
described in Section 1.11(b) who becomes a Member under Section 2.1(b),
the monthly amount of the Qualified Plan Survivor Benefit to which the Member
would have been entitled under the terms of the Qualified Plan if such benefit
were computed:

 

(i)            including in the definition of “Salary” any
amounts voluntarily deferred by the Member under the Thrift BEP;

 

12

 

(ii)           without regard to Code Limitations;

 

(iii)          including in the definition of “Salary” any
Incentive Compensation paid during the applicable Plan Year (determined prior
to any deferral under the Thrift BEP);

 

(iv)          by recognizing the Member’s years of service
from his or her initial date of employment with any employer participating in
the Qualified Plan to his or her date of membership in the Qualified Plan as
benefit service under the Qualified Plan; and

 

(v)           solely with respect to Executive Officers
hired by the Bank prior to January 9, 2006 and appointed as an Executive
Officer effective on or prior to January 1, 2008, by applying an increased
annual pension accrual rate of two and three-eighths percent (2.375%);
provided, however, that aggregate pension benefits payable to such Executive
Officers (taking into account benefits determined under this Plan and the
Qualified Plan, and from any other defined benefit pension plan in which the
Member participated during any period of service taken into account in
calculating the Member’s benefit hereunder) shall not exceed a percentage of
the Member’s “High-3 Salary” (taking into account compensation described in
clauses (i), (ii) and (iii) above) equal to sixty-five percent (65%) for Senior
Vice Presidents, seventy percent (70%) for Executive Vice Presidents and eighty
percent (80%) for the President;

 

MINUS

 

(c)           the monthly amount of the Qualified Plan
Survivor Benefit that is or would be payable to the Plan Member under the terms
of the Qualified Plan, determined assuming that the Member’s death has occurred
prior to his or her actual “Commencement Date” under the Qualified Plan.

 

Notwithstanding the foregoing, the amount of a Member’s
Supplemental Survivor Benefit shall not be less than zero.  The amount described above shall be adjusted
as provided in the Qualified Plan to reflect the identity of the Beneficiary,
the form of benefit, and commencement of payments prior to the Member’s Normal
Retirement Date.  If a Member dies after
his or her Pension Commencement Date, the amount of survivor benefit then
payable, if any, shall be determined based upon the method of distribution of
benefits in effect at the time of the Member’s death.

 

4.2           Adjustment
and Payment of Grandfathered Supplemental Survivor Benefits.  The amount of Grandfathered Supplemental
Retirement Benefit to which a Member may be entitled, if any, shall be
determined and paid under the terms of the Prior Plan, and shall be subject to
adjustment to reflect the time and method of payment as described in Section 3.2.

 

4.3           Non-Grandfathered
Supplemental Survivor Benefits. 
The amount of Non-Grandfathered Supplemental Survivor Benefit described
in Section 4.1 above shall be calculated 

 

13

 

based upon the Member’s Qualified Plan Retirement Benefit determined
assuming that the Commencement Date under the Qualified Plan is the same as the
Pension Commencement Date under this Plan (regardless of whether the Member (or
his or her surviving spouse) entered pay status under the Qualified Plan prior
to his or her death or has elected to defer commencement of his or her
Qualified Plan Survivor Benefit to a later Commencement Date), reduced by any
Grandfathered Supplemental Survivor Benefit (calculated under Section 4.2
assuming payment commencement as of the same date).  In calculating the amount of the
Non-Grandfathered Supplemental Survivor Benefit under Section 4.1, any
Retirement Adjustment Payment, Post-Retirement Supplement or Single Purchase
Fixed Percentage Adjustment under the Qualified Plan prior to the Pension
Commencement Date under this Plan shall not be taken into account.

 

The Member’s Non-Grandfathered Supplemental Survivor
Benefit shall be adjusted as provided under the terms of the Qualified Plan, to
the extent applicable, to reflect commencement of payments prior to the Member’s
Normal Retirement Date or payment in a form of benefit other than a single-life
annuity.  In determining the amount of
any optional form of benefit, the factors set forth in the Qualified Plan shall
apply.  The Member’s Non-Grandfathered
Supplemental Survivor Benefit paid in annuity form shall be further adjusted to
reflect any Retirement Adjustment Payment and/or Annual Increment which becomes
effective with respect to Qualified Plan Survivor Benefits after the Pension
Commencement Date.  A Single Purchase
Fixed Percentage Adjustment after the Pension Commencement Date shall apply to
Non-Grandfathered Supplemental Survivor Benefits in pay status solely to the
extent provided by the Board of Directors consistent with Code Section 409A.  If the Non-Grandfathered Supplemental
Survivor Benefit is paid in a lump sum distribution hereunder, no Single
Purchase Fixed Percentage Adjustment shall apply.

 

4.4           Payment
of Non-Grandfathered Supplemental Survivor Benefits.  Except as otherwise provided in Section 7.3
or in the last sentence of Section 2.2, a Member may elect the payment of
his or her Non-Grandfathered Supplemental Survivor Benefit in such form as is
then available with respect to Qualified Survivor Benefits under the terms of
the Qualified Plan.  An election under
this Section 4.4 shall be made in a writing acceptable to the
Administrator and filed with the Administrator within the thirty (30) day
period set forth in Section 2.1 or, if later, within the transition
election period set forth in Section 2.2. 
If a Member fails to file an election of method of distribution for his
or her Non-Grandfathered Supplemental Survivor Benefit within the time provided
in Section 2.1 or 2.2, he or she shall be deemed to have elected to have
such benefit paid in the normal (default) payment form of the Qualified
Survivor Benefit to which such Non-Grandfathered Supplemental Survivor Benefit
corresponds.

 

4.5           Change in
Distribution Election for Non-Grandfathered Supplemental Survivor Benefits.  To the extent permitted by the Administrator
and consistent with Code Section 409A and regulations thereunder, a Member
may elect to change the time of distribution of his or her Non-Grandfathered
Supplemental Survivor Benefit after the initial deferral election by filing a
written request with the Administrator. 
Such a change election shall not take effect until at least twelve
months after the date on which it is made and shall be effective only if (a) the
election is filed with the Administrator before the Member’s Termination of
Employment; (b) the election does not accelerate the timing or payment
schedule of any distribution; (c) the payment commencement date in the
change election is not less than five years after the date the 

 

14

 

distribution would otherwise have commenced due to the Member’s death
without regard to such election, and not later than five years after the Member’s
Normal Retirement Date (or actual Retirement Date, if later); and (d) the
Administrator approves such election.  A
Member’s distribution election shall become irrevocable upon the Member’s death
or Termination of Employment, whichever is earlier.  Notwithstanding the foregoing, a Member may
not elect a distribution date later than (a) April 1 of the calendar
year after the year in which the Member attains age 701⁄2, or (b) five years
after the Member’s Termination of Employment, if later.

 

4.6           Other
Payment Rules.  Sections
3.6 through 3.9 shall apply to the payment of Non-Grandfathered Supplemental
Survivor Benefits.

 

SECTION 5 - ADMINISTRATION
OF THE PLAN

 

5.1           Administration
by the Bank.  The
Committee shall be responsible for the general operation and administration of
the Plan and for carrying out the provisions thereof.  The Committee may appoint such person or
persons as it deems appropriate to perform all or any of the functions of the
Administrator under the terms of the Plan. 
To the extent that no such person or persons are appointed, the
Committee shall serve as Administrator.

 

5.2           General
Powers of Administration. 
The Committee shall have authority and discretion to control and manage
the operation and administration of the Plan, including all rights and powers
necessary or convenient to the carrying out of its functions hereunder, whether
or not such rights and powers are specifically enumerated herein.  The Committee may, in its discretion, delegate
authority with regard to the administration of the Plan to any individual,
officer or committee in accordance with Section 5.2(g) below. Notwithstanding
any other provision of the Plan, if an action or direction of any person to
whom authority hereunder has been delegated conflicts with an action or
direction of the Committee, then the authority of the Committee shall supersede
that of the delegate with respect to such action or direction.

 

Without limiting the generality of the foregoing, and
in addition to the other powers set forth in this Section 5.2, the
Committee or its delegate shall have the following express authorities:

 

(a)           To construe and interpret the provisions of
the Plan; to decide all questions arising thereunder, including, without
limitation, questions of eligibility for participation, eligibility for
benefits, the validity of any election or designation made under the Plan, and
the amount, manner and time of payment of any benefits hereunder; and to make
factual determinations necessary or appropriate for such decisions or
determination;

 

(b)           To prescribe procedures to be followed by
Members, Beneficiaries or alternate payees in filing applications for benefits
and any other elections, designations and forms required or permitted under the
Plan;

 

(c)           To prepare and distribute information
explaining the Plan;

 

15

 

(d)           To receive from the Bank and from Members,
Beneficiaries and alternate payees such information as shall be necessary for
the proper administration of the Plan;

 

(e)           To furnish the Bank or the Board of
Directors, upon request, such reports with respect to the administration of the
Plan as are reasonable and appropriate;

 

(f)            To appoint or employ advisors, including
legal and actuarial counsel (who may also be counsel to the Bank) to render
advice with regard to any responsibility of the Committee under the Plan or to
assist in the administration of the Plan;

 

(g)           To designate in writing other persons to
carry out a specified part or parts of its responsibilities hereunder
(including this power to designate other persons to carry out a part of such
designated responsibility). Any such person may be removed by the Committee at
any time with or without cause;

 

(h)           To rule on claims, and to determine the
validity of domestic relations orders and comply with such orders; and

 

(i)            All rules, actions, interpretations and
decisions of the Committee are conclusive and binding on all persons, and shall
be given the maximum possible deference allowed by law.

 

5.3           Rules of
the Administrator.  The
Administrator may adopt such rules as it deems necessary, desirable or
appropriate. When making a determination or calculation, the Administrator
shall be entitled to rely upon information furnished by a Member or
Beneficiary, the Bank, the legal counsel of the Bank, or such other person as
it deems appropriate, and shall further be entitled to rely conclusively upon
all tables, valuations, certificates, opinions and reports furnished by any
actuary, accountant, controller, counsel or other person employed or engaged by
the Bank with respect to the Plan.

 

5.4           Claims
Procedure.  Any person who
believes that he or she is then entitled to receive a benefit under the Plan
may file a claim in writing with the Administrator.  Except to the extent the Committee adopts an
alternate procedure for the review of claims, the procedures in this Section 5.4
shall apply.  The Administrator shall,
within ninety (90) days of the receipt of a claim, either allow or deny the
claim in writing.  A denial of a claim
shall be written in a manner calculated to be understood by the claimant and
shall include: (a) the specific reason or reasons for the denial; (b) specific
references to pertinent Plan provisions on which the denial is based; (c) a
description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary; and (d) an explanation of the Plan’s claim
review procedure.  A claimant whose claim
is denied (or his or her duly authorized representative) may, within sixty (60)
days after receipt of denial of the claim: (1) submit a written request
for review to the Committee; (2) review pertinent documents; and (3) submit
issues and comments in writing.  The
Administrator shall notify the claimant of the decision of the Committee on
review within sixty (60) days of receipt of a request.  No legal action may be commenced by a Member
or Beneficiary with respect to a benefit under this Plan without first
exhausting the Plan’s administrative claims procedures, and any legal action
with 

 

16

 

respect to a claim that has been finally denied must be commenced no
later than one year after the date of the Plan’s final denial of such claim
upon appeal.

 

SECTION 6 - AMENDMENT OR
TERMINATION

 

6.1           Amendment
or Termination.  The Board
of Directors may amend or terminate, in whole or in part, the Plan without the
consent of any Member, Beneficiary or other person; provided, however, that no
amendment or termination of the Plan shall retroactively impair or otherwise
adversely affect the rights of any Member or Beneficiary to benefits under the
Plan which have accrued prior to the date of such action; and provided further,
that an accrued benefit may be decreased as a result of equivalent increases in
the Member’s Qualified Plan Retirement Benefit due to increases in applicable
Code Limitations.  Notwithstanding the
foregoing, the Board of Directors may amend the Plan as it deems necessary to
comply with applicable law, including Code Section 409A and regulations
thereunder.

 

SECTION 7 - GENERAL
PROVISIONS

 

7.1           Member’s
Rights Unsecured.  The
right of any Member to receive future payments under the provisions of the Plan
shall be an unsecured claim against the general assets of the Bank.  The Bank shall be under no obligation to
establish any separate fund, purchase any annuity contract, or in any other way
make any special provision or specifically earmark any funds for the payment of
amounts called for under the Plan.  If
the Bank chooses to establish such a fund, or purchase such an annuity contract
or make any other agreement to provide for such payments, that fund, contract
or arrangement shall remain part of the Bank’s general assets and no person
claiming payments under the Plan shall have any right, title or interest in or
to any such fund, contract or arrangement.

 

7.2           Non-assignability.  None of the benefits, payments, proceeds or
claims of any Member or Beneficiary shall be subject to any claim of any
creditor of any Member or Beneficiary and, in particular, the same shall not be
subject to attachment or garnishment or other legal process by any creditor of
such Member or Beneficiary, nor shall any Member or Beneficiary have any right
to alienate, anticipate, commute, pledge, encumber or assign any of the
benefits or payments or proceeds which he or she may expect to receive,
contingently or otherwise, under the Plan. 
Notwithstanding the foregoing, the Bank shall comply with the terms of a
domestic relations order applicable to a Member’s interest in the Plan,
provided that such order does not require the payment of benefits in a manner
or amount, or at a time, inconsistent with the terms of the Plan.  The Bank shall have no liability to any
Member or Beneficiary to the extent that his or her benefit is reduced in
accordance with the terms of a domestic relations order that the Bank applies
in good faith.  In determining the amount
of any Supplemental Benefit under Section 3.1 or 4.1 of the Plan, the
amount of Qualified Plan Benefit taken into account under Section 3.1(c) or
4.1(c), respectively, shall be determined prior to reduction for any award
under a qualified domestic relations order relating to such Benefit.

 

7.3           Small
Benefits.  If the present
value of aggregate Supplemental Benefit as of the Pension Commencement Date is
less than the dollar limitation on elective deferrals as then in effect under
Code Section 402(g), the Bank shall pay the present value of such benefit
to the 

 

17

 

Member or Beneficiary, as applicable, in a single lump sum in lieu of
any further benefit payments hereunder. 
Present value shall be calculated as provided in the Qualified Plan.

 

7.4           Taxes.  The Administrator shall withhold all federal,
state or local taxes that it reasonably believes are required to be withheld
from any payments under the Plan.

 

7.5           Limitation
of Member’s Rights. 
Nothing contained in the Plan shall confer upon any person a right to be
employed or to continue in the employ of the Bank, or interfere in any way with
the right of the Bank to terminate the employment of a Member at any time, with
or without cause.

 

7.6           Receipt
and Release.  Any payment
to any Member or Beneficiary in accordance with the provisions of the Plan
shall, to the extent thereof, be in full satisfaction of all claims against the
Bank or the Plan, and the Administrator may require such Member or Beneficiary,
as a condition precedent to such payment, to execute a receipt and release to
such effect.  If any Member or
Beneficiary is determined by the Administrator to be incompetent by reason of
physical or mental disability (including minority) to give a valid receipt and
release, the Administrator may cause the payment or payments becoming due to
such person to be made to another person for his or her benefit without
responsibility on the part of the Administrator or the Bank to follow the application
of such funds.

 

7.7           Unclaimed
Benefit.  Each Member
shall keep the Company informed of his or her current address and the current
address of his or her spouse.  The
Company shall not be obligated to search for the whereabouts of any
person.  In the event any person who is
entitled to a benefit from the Plan cannot be located and such benefit remains
unpaid for one year after the date payment was due, the amount required to pay
such benefit shall remain in the rabbi trust (if applicable) or else retained
by the Company; provided, however, that if the person who is entitled to the
benefit is subsequently located, the benefit shall be restored and paid to such
person without provision for interest.

 

7.8           Governing
Law.  The Plan shall be
construed, administered, and governed in all respects under and by the laws of
the Commonwealth of Massachusetts.  If
any provision shall be held by a court of competent jurisdiction to be invalid
or unenforceable, the remaining provisions hereof shall continue to be fully effective.

 

7.9           Designation
of Beneficiary.  Each
Member may file with the Administrator a written designation of one or more
persons as the Beneficiary who shall be entitled to receive the amount, if any,
payable under the Plan upon the Member’s death. 
The Member may, from time to time, revoke or change his or her
Beneficiary designation without the consent of any prior Beneficiary by filing
a new designation with the Administrator. 
The last such designation received by the Administrator shall be controlling;
provided, however, that no designation, or change or revocation thereof, shall
be effective unless received by the Administrator prior to the Member’s death,
and in no event shall it be effective as of a date prior to such receipt.  If the Administrator is in doubt as to the
right of any person to receive such amount, the Administrator may retain such
amount, without liability for any interest thereon, until the rights thereto
are determined, or the Administrator may pay such amount into any court of competent
jurisdiction 

 

18

 

and such payment shall be a complete discharge of the liability of the
Plan and the Bank therefor.  If no
Beneficiary is designated or no designated Beneficiary survives the Member,
payment shall be made in a single lump sum to the Member’s estate.

 

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

 

7.11         Indemnification.  No Committee member shall be personally
liable by reason of any instrument executed by him or on his behalf, or action
taken by him, in his capacity as a Committee member nor for any mistake of
judgment made in good faith.  The Bank
shall indemnify and hold harmless the Plan and each Committee member and each
employee, officer or director of the Bank or the Plan, to whom any duty, power,
function or action in respect of the Plan may be delegated or assigned, or from
whom any information is requested for Plan purposes, against any cost or
expense (including fees of legal counsel) and liability (including any sum paid
in settlement of a claim or legal action with the approval of the Bank) arising
out of anything done or omitted to be done in connection with the Plan, unless
arising out of such person’s fraud or bad faith.

 

7.12         Headings
and Subheadings.  Headings
and subheading in this Plan are inserted for convenience only and are not to be
considered in the construction of the provisions hereof.

 

IN WITNESS WHEREOF,
and pursuant to adoption of this Plan Document by the Board of Directors of the
Bank has caused this Plan Document to be executed this 25th day of July, 2008
by:

 

 

	
  /s/Janelle K. Authur

  	
   

  	
  /s/Ellen McLaughlin

  
	
  Senior Vice
  President/Executive Director of

  	
   

  	
  Senior Vice
  President/General Counsel

  
	
  Human Resources

  	
   

  	
   

  

 

19

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