Document:

Exhibit 10.1

 

THE FEDERAL HOME LOAN BANK OF BOSTON

 

PENSION BENEFIT EQUALIZATION PLAN

 

Effective January 1, 1993

 

 

As Amended and Restated

Effective as of October 1, 1997

 

 

THE FEDERAL HOME LOAN BANK OF BOSTON

PENSION BENEFIT EQUALIZATION PLAN

 

TABLE OF CONTENTS

 

	
  ARTICLE I. 

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.01

  	
  Actuary

  	
   

  
	
   

  	
  1.02

  	
  Adoption
  Date

  	
   

  
	
   

  	
  1.03

  	
  Bank

  	
   

  
	
   

  	
  1.04

  	
  Beneficiary

  	
   

  
	
   

  	
  1.05

  	
  Board of
  Directors

  	
   

  
	
   

  	
  1.06

  	
  Code

  	
   

  
	
   

  	
  1.07

  	
  Code
  Limitations

  	
   

  
	
   

  	
  1.08

  	
  Committee

  	
   

  
	
   

  	
  1.09

  	
  Effective
  Date

  	
   

  
	
   

  	
  1.10

  	
  Eligible
  Executive

  	
   

  
	
   

  	
  1.11

  	
  Executive
  Officer

  	
   

  
	
   

  	
  1.12

  	
  Incentive
  Compensation

  	
   

  
	
   

  	
  1.13

  	
  Member

  	
   

  
	
   

  	
  1.14

  	
  Plan

  	
   

  
	
   

  	
  1.15

  	
  Retirement
  Fund

  	
   

  
	
   

  	
  1.16

  	
  Thrift
  Benefit Equalization Plan

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
  MEMBERSHIP

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
  AMOUNT AND PAYMENT OF PENSION BENEFITS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
  DESIGNATION OF BENEFICIARIES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
  SOURCE OF PAYMENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
  ADMINISTRATION OF THE PLAN

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII. 

  	
  AMENDMENT AND TERMINATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
  GENERAL PROVISIONS

  	
   

  

 

 

THE FEDERAL HOME LOAN BANK OF BOSTON

PENSION BENEFIT EQUALIZATION PLAN

 

THE FEDERAL HOME LOAN BANK OF BOSTON (the “Bank”) established the
Benefit Equalization Plan effective as of January 1, 1993. The Plan is now
being amended and restated as follows:

 

INTRODUCTION

 

The Benefit Equalization Plan was originally established to provide to
certain employees of the Bank the benefits which would have been payable under
the Comprehensive Retirement Program of the Financial Institutions Retirement
Fund (the “Retirement Fund”), and benefits equivalent to the matching
contributions and 401(k) contributions which would have been available under
the Financial Institutions Thrift Plan (the “Thrift Plan”), but for (i) the
limitations placed on benefits and matching contributions for such employees by
Sections 401(a)(17), 401(k)(3)(A)(ii), 401(m), 402(g) and 415 of the Internal
Revenue Code of 1986, as amended, and (ii) the exclusion of bonuses, amounts
paid under the Bank’s incentive compensation plan and amounts deferred under
Sections 4.01 and 4.02 of that Plan from the definition of “Base Salary” under
the Retirement Fund and the Thrift Plan. Effective as of January 1, 1997, the
Bank split the Plan into two plans, one covering retirement-related benefits
and the other addressing thrift-related benefits. The Plan is now being amended
to provide that any benefits payable to or on behalf of

 

1

 

a Member covered by a split dollar life insurance policy issued in
connection with the Plan shall be distributed in one lump sum following his
termination of employment or death. Accordingly, this Plan as hereinafter set
forth is intended to provide the retirement-related benefits previously
provided under Article III of the Plan as in effect on December 31, 1996 and to
provide certain additional benefits.

 

All benefits payable under this Plan shall be paid solely out of the
general assets of the Bank. No benefits under this Plan shall be payable by the
Retirement Fund or its asset.

 

2

 

ARTICLE I. DEFINITIONS

 

When used in the Plan, the following terms shall have the following
meanings:

 

1.01         “Actuary” means the independent consulting actuary retained
by the Bank to assist the Committee in its administration of the Plan.

 

1.02         “Adoption Date” means the date the Plan is adopted by the
Board of Directors.

 

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

 

1.04         “Beneficiary” means the beneficiary or beneficiaries
designated in accordance with Article IV of the Plan to receive the benefit, if
any, payable upon the death of a Member of the Plan.

 

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

 

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

 

1.07         “Code Limitations” means the cap on compensation taken into
account by a plan under Code Section 401(a)(17) and the overall limitations on
contributions and benefits imposed

 

1

 

on qualified plans by Code Section 415, as such provisions may be
amended from time to time, and any similar successor provisions of federal tax
law.

 

1.08         “Committee” means the Personal Committee of the Board of
Directors of the Bank, which is authorized to administer the Plan.

 

1.09         “Effective Date” means January 1, 1993. The effective date
of this restatement is January 1, 1997.

 

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

 

1.11         “Executive Officer” means an Eligible Executive who is
designated as an Executive Officer by the Personal Committee of the Bank.

 

1.12         “Incentive Compensation” means bonuses and other incentive
compensation payments, including any long term incentive payments, payable to a
Member under the Bank’s incentive compensation plan.

 

1.13         “Member” means any person included in the membership of the
Plan as provided in Article II.

 

2

 

1.14         “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.

 

1.15         “Retirement Fund”
means the Comprehensive Retirement Program of the Financial Institutions
Retirement Fund, a qualified and tax-exempt defined benefit pension plan and
trust under Sections 401(a) and 501(a) of the Code, as adopted by the Bank.

 

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

 

3

 

ARTICLE II. MEMBERSHIP

 

2.01         Each
Eligible Executive of the Bank shall become a Member of the Plan on the latest
of (i) the date on which he is included in the membership of the Retirement
Fund, (ii) the date he is selected as an Eligible Executive, or (iii) the
Effective Date.

 

2.02         Section
2.01 to the contrary notwithstanding, the Committee may, in its discretion,
elect to include in the membership of the Plan an Eligible Executive on the
date that he commences employment with the Bank, but no earlier than the
Effective Date.

 

2.03         A
benefit shall be payable under the Plan to or on account of a Member only upon
the Member’s retirement, death or other termination of employment with the
Bank.

 

2.04         No
employee shall have the automatic right to be selected as an Eligible Executive
for any year, or, having been selected as an Eligible Executive for one year,
be considered an Eligible Executive for any other year. If a Member ceases to
be an Eligible Executive but continues to be employed by the Bank, he shall
cease to accrue any further pension benefit under Sections 3.01(a)(ii) and
(iv).

 

4

 

ARTICLE III.
AMOUNT AND PAYMENT OF PENSION BENEFITS

 

3.01         Subject
to the provisions of Sections 3.02 and 3.03, the amount, if any, of the annual
pension benefit payable to or on account of a Member pursuant to the Plan shall
equal the excess of (a) over (b), as determined by the Committee, where:

 

(a)           is
the annual pension benefit (as calculated by the Retirement Fund on the basis
of the form of payment elected under it by the Member) that would otherwise be
payable to or on account of the Member by the Retirement Fund if its provisions
were administered

 

(i)            without
regard to the Code Limitations;

 

(ii)           with
the inclusion in the definition of “Base Salary” for the year deferred of any
amounts deferred by a Member under the Thrift Benefit Equalization Plan, and
for the year paid of any Incentive Compensation (determined prior to any
deferral under the Thrift Benefit Equalization Plan);

 

(iii)          by
recognizing his years of service rendered from his initial date of employment
with any employer participating in the Retirement Fund to his date of
membership in the Retirement Fund as benefit service under the Retirement Fund;
and

 

(iv)          solely
with respect to Executive Officers, by taking into account such increased
benefit accrual rate under the Retirement Fund’s benefit formula

 

5

 

as may be established from time to time by
resolution of the Board of Directors, which resolution shall be appended to and
deemed a part of this Plan.

 

(b)           is
the annual pension benefit (as calculated by the Retirement Fund on the basis
of the form of payment elected under it by the Member) that is payable to or on
account of the Member under the Retirement Fund.

 

For purposes of this section 3.01, “annual pension benefit” includes
any “Active Service Death Benefit”, “Retirement Adjustment Payment”, “Annual
Increment” and “Single Purchase Fixed Percentage Adjustment” which the Bank
elected to provide its employees under the Retirement Fund.

 

The Bank’s obligation for the benefit provided under this Plan may be
satisfied in whole or in part by any proceeds payable to the Member (or the
Member’s Beneficiary, if applicable) from any insurance policy (including a
split dollar arrangement) insuring the life of the Member issued in connection
with the Plan.

 

3.02         The
following provision shall govern the payment of benefits to or on behalf of a
Member who is not covered by a split dollar life insurance policy issued in
connection with the Plan:

 

(a)           The
benefit payable to or on account of a Member pursuant to Section 3.01 shall be
paid in the same form as elected by the Member under the Retirement Fund.

 

6

 

Notwithstanding the foregoing, in no event
shall a Member be entitled to receive a lump sum payment under the terms of
this Plan unless he has filed an irrevocable election to that effect with the
Committee at least 12 full calendar months prior to his date of retirement. In
the event a Member elects to receive his benefit under the Retirement Fund in
the form of a lump sum payment and has failed to make the election required by
the preceding sentence, the Member’s pension benefit payable under this Plan
shall be payable to or on account of the Member in the “Regular Form” of
payment as defined in the Retirement Fund.

 

If the Member’s benefit is not payable in the “Regular Form” under this
Section 3.02, the benefit payable in an optional form shall be of equivalent
actuarial value to the benefit otherwise payable in the Regular Form.  For this purpose, equivalent actuarial value
shall be determined by the actuary under the same actuarial factors and
assumptions then used by the Retirement Fund to determine actuarial equivalence
under the Retirement Fund.

 

(b)           If
a Member dies after the date his benefit payments under the plan had commenced,
the only death benefit payable under the Plan in respect of said Member shall
be the amount, if any, payable under the form of payment which the Member had
elected. If a Member who had elected a lump sum payment under paragraph (a)
above dies before the date his benefit payments under the Plan commences, his
election of the lump sum payment shall be inoperative.

 

7

 

(c)           If
a Member to whom an annual pension benefit is payable under the plan dies while
in active service or following retirement or other termination of employment
but prior to the commencement of his pension under this Plan, the death benefit
will be computed as under the Retirement Fund with the adjustments as in
Section 3.01 above and any amount which may not be paid under the Retirement
Fund shall be payable under this Plan.

 

(d)           Notwithstanding
any other provision of this Plan, if on the date payment under the Plan would
otherwise commence the lump sum settlement value of a Member’s benefit
determined by the Actuary does not exceed $3,500, then that Member’s benefit
shall automatically be paid in the form of a lump sum settlement.

 

(e)           All
annual pension benefits under the Plan shall be paid in monthly, quarterly, or
annual installments, as determined by the committee in its discretion.  Benefits shall commence as soon as
practicable following the Member’s retirement date under the Retirement Fund,
except that no benefits shall be paid prior to the date that benefits under the
Plan can be definitely determined by the Committee.

 

3.03         The
following provisions shall govern the payment of benefits to or on behalf of a
Member who is covered by a split dollar life insurance policy issued in
connection with the Plan:

 

8

 

(a)           Upon
termination of employment of a Member to whom a benefit is payable under the
Plan, the Member’s benefit shall be determined under Section 3.01 and shall be
paid in one lump sum payment as soon as practicable following the Member’s date
of termination of employment with the Bank. For purposes of calculating the
benefit due under Section 3.01, (i) the Member shall be deemed to have elected
a lump sum payment under the Retirement Fund, and (ii) in the event the Member
was vested under the Retirement Fund but had not reached the minimum age to
elect commencement of his retirement benefit under the Retirement Fund, the
amount of the retirement benefit deemed to be payable under the Retirement Fund
and this Plan as of his date of termination shall be the equivalent actuarial
value of the retirement benefit which would be payable at the earliest date at
which the Member could elect benefit commencement under that Plan and this Plan
had he deferred payment to that date. 
For purposes of this paragraph (a), equivalent actuarial value shall be
determined by the Actuary on the basis of the interest rate and mortality table
then used by the Retirement Fund to determine actuarial equivalence under the
Retirement Fund.

 

(b)           If
a Member to whom a benefit is payable under the Plan dies while in active
service, the Member’s Beneficiary shall be entitled to receive the benefit
which would have been payable to the Member had the Member retired on the day
preceding his date of death and had made an effective election of a lump sum

 

9

 

payment under the Retirement Fund and this Plan payable as of the first
day of the month following his date of death. In the event the Member was
vested under the Retirement Fund but had not reached the minimum age to elect
commencement of his retirement benefit under the Retirement Fund, the amount of
the retirement benefit deemed to be payable under the Retirement Fund and this
Plan as of his date of death shall be the equivalent actuarial value of the
retirement benefit which would be payable at the earliest date at which the
Member could elect benefit commencement under that Plan and this Plan had be
survived to that date. The lump sum payment shall be made as soon as
practicable following the death of the Member. For purposes of this paragraph
(b), equivalent actuarial value shall be determined by the Actuary on the basis
of the interest rate and mortality table then used by the Retirement Fund to
determine actuarial equivalence under the Retirement Fund.

 

3.04         If
a Member is restored to employment with the Bank, payment of any pension
benefits shall cease. Upon his subsequent retirement or termination of
employment with the Bank, his benefit under the Plan shall be recomputed in
accordance with Section 3.01, but shall be reduced by the equivalent actuarial
value of the amount of any benefit paid by the Plan in respect of his previous
retirement or termination of employment, and such reduced benefit shall be paid
to the Member in accordance with the provisions of the Plan. For purposes of
this Section 3.04, the equivalent actuarial value of the benefit paid

 

10

 

in respect of the Member’s previous retirement or termination of
employment shall be determined by the Actuary utilizing for that purpose the
same actuarial factors and assumptions then used by the Retirement Fund to
determine actuarial equivalence under the Retirement Fund.

 

11

 

ARTICLE IV. DESIGNATION
OF BENEFICIARIES

 

4.01         Each
Member of the Plan may file with the Committee 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 his death. The Member may, from time to time,
revoke or change his Beneficiary designation without the consent of any prior
Beneficiary by filing a new designation with the Committee. The last such
designation received by the Committee shall be controlling; provided, however,
that no designation, or change or revocation thereof, shall be effective unless
received by the Committee prior to the Member’s death, and in no event shall it
be effective as of a date prior to such receipt.

 

4.02         If
no such Beneficiary designation is in effect at the time of a Member’s death,
or if no designated Beneficiary survives the Member, or if, in the opinion of
the Committee, such designation conflicts with applicable law, the Member’s
estate shall be deemed to have been designated his Beneficiary and shall be
paid the amount, if any, payable under the Plan upon the Member’s death. If the
Committee is in doubt as to the right of any person to receive such amount, the
Committee may retain such amount, without liability for any interest thereon,
until the rights thereto are determined, or the Committee may pay such amount
into any court of appropriate jurisdiction and such payment shall be a complete
discharge of the liability of the Plan and the Bank therefor.

 

12

 

ARTICLE V. SOURCE OF
PAYMENT

 

5.01         All
payments of benefits under the Plan shall be paid from, and shall only be a
general claim upon, the general assets of the Bank, notwithstanding that the
Bank, in its discretion, may establish a bookkeeping reserve or a grantor trust
(as such term is used in Code Sections 671 through 677) to reflect or to aid it
in meeting its obligations under the Plan with respect to any Member or
prospective Member or Beneficiary. No benefit whatever provided by the Plan
shall be payable from the assets of the Retirement Fund.

 

5.02         No
Member shall have any right, title or interest whatever in or to any
investments which the Bank may make or any specific assets which the Bank may
reserve to aid it in meeting its obligations under the Plan. To the extent that
any person acquires a right to receive payments from the Bank under the Plan,
such right shall be no greater than the right of an unsecured general creditor
of the Bank.

 

13

 

ARTICLE VI.
ADMINISTRATION OF THE PLAN

 

6.01         The
Committee shall have general authority over and responsibility for the
administration and interpretation of the Plan. The Committee shall have full
power and discretionary authority to interpret and construe the Plan, to make
all determinations considered necessary or advisable for the administration of
the Plan and any trust referred to in Article V, and the calculation of the
amount of benefits payable thereunder, and to review claims for benefits under
the Plan. Unless arbitrary or capricious, the Committee’s interpretations and
constructions of the Plan and its decisions or actions thereunder shall be
binding and conclusive on all persons for all purposes.

 

6.02         The
Committee shall arrange for the engagement of the Actuary, and if the Committee
deems it advisable, it shall arrange for the engagement of legal counsel and
certified public accountants (who may be counsel or accountants for the Bank),
and other consultants, and make use of agents and clerical or other personnel,
for purposes of the Plan. The Committee may rely upon the written opinions of
such Actuary, counsel, accountants and consultants, and upon any information
supplied by the Retirement Fund for purposes of Section 3.01, and delegate to
any agent or to any sub-committee or Committee member its authority to perform
any act hereunder, including without limitations those matters involving the
exercise of discretion; provided, however, that such delegation shall be
subject to revocation at any time at the discretion of the Committee. The
Committee shall report to the Board of Directors, or to a committee

 

14

 

designated by the Board, at such intervals as shall be specified by the
Board or such designated committee, with regard to the matters for which it is
responsible under the Plan.

 

6.03         No
Committee member shall be entitled to act on or decide any matters relating
solely to such member or any of his rights or benefits under the Plan.

 

6.04         Each
Committee member shall be reimbursed for any reasonable expenses incurred in
connection with his services as a Committee member. No bond or other security
need be required of the Committee or any member thereof in any jurisdiction.

 

6.05         All
claims for benefits under the Plan shall be submitted in writing to the
Chairman of the Committee. Written notice of the decision on each such claim
shall be furnished with reasonable promptness to the Member or his Beneficiary
(the claimant). The claimant may request a review by the Committee of any
decision denying the claim in whole or in part. Such request shall be made in writing
and filed with the Committee within 30 days of such denial. A request for
review shall contain all additional information which the claimant wishes the
Committee to consider. The Committee may hold any hearing or conduct any
independent investigation which it deems desirable to render its decision, and
the decision on review shall be made as soon as feasible after the Committee’s
receipt of the request for review. Written notice of the decision on review
shall be furnished to the claimant. For all purposes under the Plan, such
decisions on claims (where no review is 

 

15

 

requested) and decisions on review (where review is requested) shall be
final, binding and conclusive on all interested persons as to all matters
relating to the Plan.

 

6.06         All expenses incurred by
the Committee in its administration of the Plan shall be paid by the Bank.

 

16

 

ARTICLE VII. AMENDMENT AND TERMINATION

 

7.01         The
Board of Directors may amend, suspend or terminate, in whole or in part, the
Plan without the consent of the Committee, any Member, beneficiary or other
person, except that no amendment, suspension or termination shall retroactively
impair or otherwise adversely affect the rights of any Member, Beneficiary or
other person to benefits under the Plan which have accrued prior to the date of
such action, as determined by the amendment or take any other action which may
be necessary or appropriate to facilitate the administration, management and
interpretation of the Plan or to conform the Plan thereto.

 

17

 

ARTICLE VIII. GENERAL PROVISIONS

 

8.01         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 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.

 

8.02         Neither
the Plan nor any action taken thereunder shall be construed as giving to a
Member the right to be retained in the employ of the Bank or as affecting the
right of the Bank to dismiss any Members from its employ.

 

8.03         The
Bank shall withhold or cause to be withheld from all benefits payable under the
Plan all federal, state, local or other taxes required by applicable law to be
withheld with respect to such payments.

 

18

 

8.04         No
right or interest of a Member under the Plan may be assigned, sold, encumbered,
transferred or otherwise disposed of and any attempted disposition of such
right or interest shall be null and void. Further, no right or interest of a
Member may be reached by any creditor of the Member.

 

8.05         If
the Committee shall find that any person to whom any amount is or was payable
under the Plan is unable to care for his affairs because of illness or accident
or because he is a minor, then any payment, or any part thereof, due to such
person (unless a prior claim therefor has been made by a duly appointed legal
representative), may, if the Committee is so inclined, be paid to such person’s
spouse, child or other relative, an institution maintaining or having custody
of such person, or any other person deemed by the Committee to be a proper
recipient on behalf of such person otherwise entitled to payment. Any such
payment shall be in complete discharge of the liability of the Plan and the
Bank therefor.

 

8.06         All
elections, designations, requests, notices, instructions, and other
communications from a Member, Beneficiary or other person to the Committee
required or permitted under the Plan shall be in such from as is prescribed
from time to time by the Committee and shall be mailed by first-class mail or
delivered to such location as shall be specified by the Committee and shall be
deemed to have been given and delivered only upon actual receipt thereof at
such location.

 

19

 

8.07         The
benefits payable under the Plan shall be in addition to all other benefits provided
for employees of the Bank and shall not be deemed salary or other compensation
by the Bank for the purpose of computing benefits to which he may be entitled
under any other plan or arrangement of the Bank.

 

8.08         No
Committee member shall be personally liable by reason for 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 or judgment made in good faith. The Bank
shall indemnify and hold harmless the Retirement Fund, and each Committee
member and each employee, officer or director of the Bank, or the Retirement
Fund, 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.

 

8.09         As
used in the Plan, the masculine gender shall be deemed to refer to the
feminine, and the singular person shall be deemed to refer to the plural,
wherever appropriate.

 

8.10         The
captions preceding the Sections of the Plan have been inserted solely as a
matter of convenience and shall not in any manner define or limit the scope or
intent of any provisions of the Plan.

 

8.11         The
Plan shall be construed according to the laws of the State of Massachusetts in
effect from time to time.

 

20

 

IN WITNESS WHEREOF, THE FEDERAL HOME LOAN BANK OF BOSTON has caused the
Plan to be executed effective as of                                     .

 

 

	
   

  	
  THE FEDERAL HOME LOAN BANK

  OF BOSTON

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
						

 

	
  Attest:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

21Exhibit 10.2

 

THE FEDERAL HOME LOAN BANK OF BOSTON

THRIFT BENEFIT EQUALIZATION PLAN

 

 

Effective January 1, 1993

 

As Amended and Restated as of August 1, 2000

 

 

THE FEDERAL HOME LOAN BANK OF BOSTON

THRIFT BENEFIT EQUALIZATION PLAN

 

TABLE OF CONTENTS

 

	
  ARTICLE
  I.

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  1.01

  	
  Account

  	
   

  
	
  1.02

  	
  Adoption Date

  	
   

  
	
  1.03

  	
  Bank

  	
   

  
	
  1.04

  	
  Base Salary

  	
   

  
	
  1.05

  	
  Beneficiary

  	
   

  
	
  1.06

  	
  Board of Directors

  	
   

  
	
  1.07

  	
  Code

  	
   

  
	
  1.08

  	
  Code Limitations

  	
   

  
	
  1.09

  	
  Committee

  	
   

  
	
  1.10

  	
  Deferral Agreement

  	
   

  
	
  1.11

  	
  Effective Date

  	
   

  
	
  1.12

  	
  Eligible Executive

  	
   

  
	
  1.13

  	
  Incentive Compensation

  	
   

  
	
  1.14

  	
  Member

  	
   

  
	
  1.15

  	
  Plan

  	
   

  
	
  1.16

  	
  Post-Secondary Education Subaccount

  	
   

  
	
  1.17

  	
  Qualifying Student

  	
   

  
	
  1.18

  	
  Retirement Subaccount

  	
   

  
	
  1.19

  	
  Subaccount

  	
   

  
	
  1.20

  	
  Thrift Plan

  	
   

  
	
  1.21

  	
  Valuation Date

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II.  MEMBERSHIP

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III.  AMOUNT OF THRIFT BENEFITS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV.  MAINTENANCE OF ACCOUNTS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.01

  	
  Adjustment of Accounts

  	
   

  
	
  4.02

  	
  Investment Performance Elections

  	
   

  
	
  4.03

  	
  Changing Investment Elections

  	
   

  
	
  4.04

  	
  Vesting of Account

  	
   

  
	
  4.05

  	
  Individual Accounts

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V. 
  PAYMENT OF ACCOUNTS

  	
   

  
	
   

  	
   

  	
   

  
	
  5.01

  	
  Commencement of Payment

  	
   

  
	
  5.02

  	
  Method of Payment

  	
   

  

 

 

	
  5.03

  	
  Hardship

  	
   

  
	
  5.04

  	
  Death Benefit

  	
   

  
	
  5.05

  	
  Designation of Beneficiary

  	
   

  
	
  5.06

  	
  Status of Accounts Pending Distribution

  	
   

  
	
  5.07

  	
  Installments and Withdrawals Pro-Rata

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI. 
  SUBACCOUNTS

  	
   

  
	
   

  	
   

  	
   

  
	
  6.01

  	
  Qualification for Post-Secondary Education
  Subaccount

  	
   

  
	
  6.02

  	
  Treatment of Subaccounts

  	
   

  
	
  6.03

  	
  Modification of Plan Provisions Applying to
  Subaccounts

  	
   

  
	
  6.04

  	
  Special Rules for Post-Secondary Education
  Subaccounts

  	
   

  
	
  6.05

  	
  Special One-Time Election

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII.  SOURCE OF PAYMENTS

  	
   

  
	
   

  	
   

  
	
  ARTICLE
  VIII.  ADMINISTRATION OF THE PLAN

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX.  AMENDMENT AND TERMINATION

  	
   

  
	
   

  	
   

  
	
  ARTICLE X.  GENERAL PROVISIONS

  	
   

  

 

 

INTRODUCTION

 

The Benefit Equalization Plan was originally established, effective as
of January 1, 1993, to provide certain employees of The Federal Home Loan Bank
of Boston (the “Bank”) with the benefits which would have been payable under
the Comprehensive Retirement Program of the Financial Institutions Retirement
Fund (the “Retirement Fund”), and benefits equivalent to the matching
contributions and 401(k) contributions which would have been available under
the Financial Institutions Thrift Plan (the “Thrift Plan”), but for (i) the
limitations placed on benefits and matching contributions for such employees by
Sections 401(a)(17), 401(k)(3)(A)(ii), 401(m), 402(g) and 415 of the Internal
Revenue Code of 1986, as amended, and (ii) the exclusion of bonuses, amounts
paid under the Bank’s incentive compensation plan and amounts deferred under
Sections 4.01 and 4.02 of this Plan from the definition of “Base Salary” under
the Retirement Fund and the Thrift Plan. Effective as of January 1, 1997, the
Bank deemed it advisable to split the Plan into two plans, one covering
retirement-related benefits and the other addressing thrift-related benefits.
This Plan as hereinafter set forth is intended to provide the thrift-related
benefits previously provided under Article IV of the Plan as in effect on
December 31, 1996 and to reflect certain administrative changes. Further, this
Plan is now being amended, effective as of August 1, 2000, to permit
subaccounts to be established for the purpose of providing financing for
post-secondary education for qualifying students and to permit the election of
an earlier payment date.

 

This plan is intended to constitute a nonqualified, unfunded deferred
compensation plan for a select group of management or highly compensated
employees under Title I of the Employee Retirement Income Security Act of 1974,
as amended. All benefits payable under this Plan shall be paid solely

 

 

out of the general assets of the Bank. No benefits under this Plan
shall be payable by the Thrift Plan or its assets.

 

2

 

ARTICLE I. DEFINITIONS

 

When used in the Plan, the following terms shall have the following meanings:

 

1.01         “Account” means the account established and maintained
hereunder the record the contributions deferred by the Member and the
contributions deemed made on their behalf by the Bank, as adjusted pursuant to
Article IV.

 

1.02         “Adoption Date” means the date the Plan is
adopted by the Board of Directors.

 

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

 

1.04         “Base Salary” means base salary as defined
under the Thrift Plan.

 

1.05         “Beneficiary”
means the beneficiary or beneficiaries designed in accordance with Section 5.05
of the Plan to receive the benefit, if any, payable upon the death of a Member
of the Plan.

 

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

 

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

 

1.08         “Code Limitations” means the cap on
compensation taken into account by a plan under Code Section 401(a)(17), the
limitations on 401(k) contributions necessary to meet the average deferral
percentage (“ADP”) test under Code

Section 401(k)(3)(A)(ii), 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 limitations on contributions and benefits imposed on qualified plans by
Code Section 415, as such provisions may be amended from time to time, and any
similar successor provisions of federal tax law.

 

1.09         “Committee” means the Personnel Committee
of the Board of Directors of the Bank, which is authorized to administer the
plan.

 

1.10         “Deferral Agreement” means the agreement
under which a Member elects to defer compensation under the Plan in accordance
with the provisions of Section 3.06.

 

1.11         “Effective Date” means January 1, 1993. The
effective date of this restatement is August 1, 2000.

 

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

 

1.13         “Incentive Compensation” means bonuses and
other incentive compensation payments, including any long-term incentive
compensation payments, payable to a Member under the Bank’s incentive
compensation plan.

 

1.14         “Member” means any person included in the
membership of the Plan as provided in Article II.

 

2

 

1.15         “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.

 

1.16         “Post-Secondary Education Subaccount” means
each Subaccount established by a Member for the purpose of providing financing
for post-secondary education for a Qualifying Student all as provided in
Article VI.

 

1.17         “Qualifying Student” means any of the
Employee’s (a) children, (b) legal spouse, (c) brothers or sisters, or spouses
thereof, or their direct lineal descendants.

 

1.18         “Retirement Subaccount” means the residual
remaining in a Member’s Account after disregarding each and every
Post-Secondary Education Subaccount established for a Member.

 

1.19         “Subaccount” means a Member’s Retirement
subaccount and all of the Post-Secondary Education Subaccounts established for
the Member, or any of them.

 

1.20         “Thrift Plan” means the Financial
Institutions Thrift Plan, a qualified and tax-exempt defined contribution plan
and trust under Sections 401(a) and 501(a) of the Code, as adopted by the Bank.

 

1.21         “Valuation Date” means the last day of each
calendar quarter.

 

3

 

ARTICLE II. MEMBERSHIP

 

2.01         Each
Eligible Executive of the Bank shall become a Member of the Plan on the latest
of (i) the date on which he is credited with an elective contribution under the
Thrift Plan, (ii) the date he is selected as an Eligible Executive, or (iii)
the Adoption Date.

 

2.02         Section
2.01 to the contrary notwithstanding, the Committee may, in its discretion,
elect to include an Eligible Executive in the membership of the Plan on the
date that he commences employment with the Bank, but no earlier than the
Adoption Date.

 

2.03         A
benefit shall be payable under the Plan to or on account of a Member only upon
the Member’s retirement, death or other termination of employment with the
Bank, except as provided in Section 5.03.

 

2.04         No
employee shall have the automatic right to be selected as an Eligible Executive
for any year, or, having been selected as an Eligible Executive for one year,
to be considered an Eligible Executive for any other year. If a Member ceases
to be an Eligible Executive but continues to be employed by the Bank, he shall
continue to have all the rights of a Member of the Plan except that he shall
not be eligible to defer any further portion of his compensation under the Plan
until he shall again become an Eligible Executive. An Eligible Executive shall
cease to be a Member when he has received all amounts to which he is entitled
under the terms of the Plan.

 

4

 

ARTICLE III. AMOUNT OF
THRIFT BENEFITS

 

3.01         During
each calendar year after 1992 and prior to 1997, if the employee’s 401(k)
account contributions under the Thrift Plan for such year have reached the
maximum permitted by the Code Limitations as determined by the Committee, and
if the employee has elected to reduce his compensation for the current calendar
year in accordance with the provisions of Section 3.06, then such employee
shall be credited with an elective contribution addition under this Plan equal
to the reduction in his compensation made in accordance with such election;
provided, however, that the sum of all such elective contribution additions for
an employee with respect to any single calendar year shall not be greater than
the excess of (a) over (b), where

 

(a)           is
an amount equal to the maximum 401(k) account contributions permitted under the
Thrift Plan for the calendar year as determined under the Thrift Plan if its
provisions were administered without regard to the Code Limitations and if
compensation as defined in the Thrift Plan included any deferrals made under
this Section 3.01 or Section 3.02; and

 

(b)           is
an amount equal to his regular account and 401(k) account contributions
actually made under the Thrift Plan for the calendar year.

 

The requirement that a Member have contributed the maximum 401(k)
account contributions permitted by the Code Limitations under the Thrift Plan
before he shall be eligible to make an election under this Section 3.01 shall
not apply to an Eligible Executive who becomes a

 

5

 

Member on his date of hire under Section 2.02 until the date he first
becomes eligible to participate in the Thrift Plan.

 

If the reduction in an employee’s compensation under such election is
determined to exceed the maximum allowable elective contribution additions for
such year, the excess and any related earnings credited under Article IV shall
be paid to such employee within the first two and one-half months of the
succeeding calendar year.

 

3.02         During
each calendar year after 1993 and prior to 1998, if a portion of an employee’s
regular account contribution or 401(k) account contribution to the Thrift Plan
for the preceding year is returned to an employee after the end of such
preceding year on account of the Code Limitations, and if the employee has
elected in accordance with the provisions of Section 3.06 to reduce his
compensation for the current year by an amount up to the sum of such Thrift
Plan contributions and related earnings returned to him for the preceding year,
then such employee shall be credited with a makeup contribution addition under
this Plan equal to the reduction in his compensation made in accordance with
such election.

 

3.03         For
each calendar year after 1992 and prior to 1997, a Member may elect, in
accordance with the provisions of Section 3.06, to defer from 2% to the “maximum
deferral percentage” (as hereinafter defined), in multiples of 1%, of the
Incentive Compensation otherwise payable to him for such year. The “maximum
deferral percentage” means the maximum deferral percentage of Base Salary a
member of the Thrift Plan may elect to contribute as 401(k) account
contributions to the Thrift Plan for the applicable calendar year, determined
without

 

6

 

regard to any Code Limitations. A Member who has made an election under
this Section 3.03 shall be credited with an incentive compensation contribution
addition under the plan equal to the reduction in his compensation made in
accordance with such election.

 

3.04         For
each calendar year after 1996, if a Member’s 401(k) account contributions under
the Thrift Plan for such year have reached the maximum permitted by the Code
Limitations as determined by the Committee and if the employee has elected to
reduce his compensation for the current calendar year in accordance with the
provisions of Section 3.06, then the Member’s Base Salary earned for periods
beginning after the date such Limitations are reached shall be reduced by the
applicable percentage elected by the Member. Such percentage may be from 1% to
100%, in multiples of 1% (except that the 1% multiple limitation shall not
apply to Base Salary earned in the payroll period in which the Limitations are
reached). A Member who has made an election under this Section 3.04 shall be
credited with an elective contribution addition under the Plan equal to the
reduction in his compensation made in accordance with such election.

 

3.05         Subject
to the provisions of Section 3.06, for each calendar year after 1996, a Member
may defer form 1% to 100%, in multiples of 1%, of the Incentive Compensation
otherwise payable to him for such year. A Member who has made an election under
this Section 3.05 shall be credited with an incentive compensation contribution
addition under the Plan equal to the reduction in his compensation made in
accordance with such election.

 

7

 

3.06         A
Member’s elections under Sections 3.01, 3.02, 3.03, 3.04 and 3.05 shall be made
in accordance with the following provisions:

 

(a)           The
Committee shall provide each Member with a Deferral Agreement at least 30 days
prior to the commencement of the calendar year in which compensation is to be
earned and paid. Each Member shall execute and deliver the Deferral Agreement
to the Committee no later than the last business day preceding the calendar
year in which compensation is to be earned and paid, except that an election
with respect to Incentive Compensation under Section 3.03, or 3.05 may be made
on or before the last business day of December of the calendar year preceding
the calendar year in which the Incentive Compensation is paid.

 

(b)           Notwithstanding
the above, an Eligible Executive who becomes eligible to participate during a
calendar year may execute a Deferral Agreement with respect to his elections
under Sections 3.01, 3.02 and 3.04 within 30 days of the date he becomes
eligible to participate. An individual who is an Eligible Executive immediately
prior to the Adoption Date may file a Deferral Agreement with the Committee
with in such period prior to the Adoption Date and in such manner as the
Committee may prescribe. With respect to Sections 3.01, 3.02 and 3.04, the
Deferral Agreement made under this paragraph (b) shall only apply to
compensation earned by the Member in the payroll periods beginning on or after
the later of the date such Agreement is submitted to the Committee or the
Adoption Date.

 

8

 

(c)           The
Deferral Agreement shall provide for separate elections with respect to
elective contribution additions under Section 3.01 and 3.04, and incentive
compensation contribution additions under Section 3.03 and 3.05.

 

(d)           An
Eligible Executive’s election on his Deferral Agreement of the rates at which
he authorizes deferrals under Sections 3.01, 3.02, 3.03, 3.04 and 3.05 shall be
irrevocable for the calendar year for which the deferral is elected.
Notwithstanding the foregoing, a Member may, in the event of an unforeseeable
emergency which results in a severe financial hardship, request a suspension of
his salary deferrals under the Plan. The request shall be made in a time and
manner determined by the Committee. The suspension shall be effective with
respect to the portion of the calendar year remaining after the Committee’s
determination that the Member has incurred a severe financial hardship. The
Committee shall apply standards, to the extent applicable, identical to those
described in Section 5.03 in making its determination.

 

(e)           A
member shall not be entitled to make deferrals under this Plan on or after
attaining the age, if any, which he has designated under Section 5.01(a)(ii) or
(iii) for the purpose of commencing distribution of his Account.

 

(f)            In
its sole discretion, the Committee may establish such other maximum or minimum
limits on the amount of elective contribution additions and incentive
compensation contribution additions a Member may make under Sections 3.04 and
3.05 as it deems

 

9

 

appropriate. Members shall be given written notice of any such limits
at least seven days prior to the date they take effect.

 

3.07         For
each elective contribution addition credited to a Member’s Account under
Sections 3.01 and 3.04, such Member’s Account shall also be credited with a
matching contribution addition under this Plan equal to the matching
contribution, if any, that would be credited under the Thrift Plan with respect
to such amount if contributed to the Thrift Plan, determined as if the
provisions of the Thrift Plan were administered without regard to the Code
Limitations and determined after taking into account the Member’s actual
contributions to and actual matching contributions under the Thrift Plan. For
each makeup contribution addition credited to a Member’s Account under Section
3.02, such Member’s Account shall also be credited with a matching contribution
addition under this Plan equal to the matching contribution, if any, that was
lost under the Thrift Plan with respect to the contributions returned for the
preceding calendar year. For each incentive compensation contribution addition
credited to a Member’s Account under Sections 3.03 and 3.05, such Member’s
Account shall also be credited with a matching contribution addition under this
Plan equal to the matching contribution, if any, that would be credited under
the Thrift Plan with respect to such amount if contributed to the Thrift Plan,
determined as if the provisions of the Thrift Plan were administered without
regard to the Code Limitation and on the basis that Base Salary under the
Thrift Plan included Incentive Compensation in the year payable.

 

3.08         The
Committee shall maintain an Account on the books and record of the Bank for
each employee who is a Member by reason of amounts credited under Sections
3.01, 3.02, 3.03,

 

10

 

3.04, 3.05 and 3.07. The elective contribution additions, makeup
contribution additions, incentive compensation contribution additions and
matching contribution addition of a Member under Sections 3.01, 3.02, 3.03,
3.04, 3.05 and 3.07 shall be credited to the Member’s Account as soon as
practical after the date that the compensation reduced under Section 3.01,
3.02, 3.03, 3.04 and/or 3.05 would otherwise have been paid to such Member.

 

3.09         As
of each Valuation Date, the Account of each Member shall be credited or debited
on the books of the Bank with the earnings, gains, or losses that would have
been generated if assets equal to each Member’s Account had been invested in
accordance with the provisions of Article IV.

 

11

 

ARTICLE IV. MAINTENANCE
OF ACCOUNTS

 

4.01        Adjustment
of Accounts

 

(a)           Subject
to the provisions of paragraphs (b) and (c) below, the Account of a Member
shall be credited from time to time with interest at the rate equivalent to the
yield on the Bank’s average earning assets.

 

(b)           As
an alternative to crediting the Account of a Member with interest or other
investment returns under paragraph (a) above, the Member may elect that his
Account be deposited in a split dollar life insurance policy. The investment
performance of the Member’s Account shall then be measured in accordance with
the terms of such policy.

 

(c)           In
addition to the investment return credit specified in paragraph (a) and the
investment option offered under paragraph (b) above, the Committee may
designate from time to time one or more phantom investment funds with may be
used to measure the investment performance of Accounts. The designation of any such
phantom investment funds shall not require the Bank to invest or carmark its
general assets in any way. The Committee may change the designation of
investment funds from time to time, in its sole discretion.

 

4.02        Investment
Performance Elections

 

In the event the Committee designated one or more investment funds
under Section 4.01(c), each Member who has not made an election under Section
4.01(b) above may file an investment election with the Committee with respect
to the investment of his Account within such time period and on such form as
the Committee may prescribe. The election shall

 

12

 

designate the investment fund or funds which shall be used to measure
the investment performance of the Member’s Account. In the event an Member
fails to make an election under this Section 4.02 when first eligible, any
subsequent election made under this Section 4.02 shall be effective as of the
first business day of the calendar quarter next following the date the election
is filed. The election shall be in increments of 1%. If a Member fails to make
an election under this Section 4.02 (and Section 4.01(b) above does not apply),
the Member’s Account shall be adjusted in accordance with the provisions of
Section 4.01(a) above.

 

4.03        Changing
Investment Elections

 

(a)           A
Member may change his election under Sections 4.01(a) and 4.02 with respect to
his future contributions to his Account by filing an appropriate written notice
with the Committee. The notice shall be effective as of the first business day
of calendar quarter following the date the notice is field with the Committee.

 

(b)           A
Member may change his election under Sections 4.01(a) and 4.02 with respect to
the measurement of the future investment performance of his existing Account
balance, by filling an appropriate written notice with the Committee. The
election shall be effective as of the first business day of the calendar
quarter following the date the notice is filed with the Committee.

 

4.04        Vesting
of Account

 

The Member shall be fully vested in his Account.

 

13

 

4.05        Individual Accounts

 

The committee shall maintain, or cause to be maintained, records
showing the individual balances of each Account.  At least once a year, each Member shall be
furnished with a statement setting forth the value of his Account.

 

14

 

ARTICLE V. PAYMENT OF
ACCOUNTS

 

5.01        Commencement
of Payment

 

(a)           Except
as otherwise provided in this Article or in Article VI relating to
Post-Secondary Education Subaccounts, the distribution of the Member’s Account
shall commence as soon as practicable after the Valuation Date coincident with
or next following the occurrence of (i), (ii), (iii) or (iv) below, as elected
by the Member on his initial Deferral Agreement:

 

(i)            the
Member’s termination of employment with the Bank,

 

(ii)           any
stated date, as long as, on that date, the Member has attained age 50 but not
age 70%

 

(iii)          the
earlier of (i) or (ii) above, or

 

(iv)          the
later of (i) or (ii) above.

 

In the event a Member elects either (ii) or (iii) above, he may not
elect a date less than three (3) years subsequent to the date he makes the
election. In the event a Member fails to make an election under this paragraph
(a), he shall deemed to have elected to have payment made in accordance with
subparagraph (i) above. In addition, an Eligible Executive who is a Member on
December 31, 1996 shall be deemed to have elected payment made in accordance
with subparagraph (i) above.

 

(b)           In
lieu of a distribution as described in paragraph (a) above, a Member may elect
on his initial Deferred Agreement that payment of his Account commence as soon
as practicable following

 

15

 

the January 1 coincident with or next
following the date the Member incurs the distributable event elected by the
Member under paragraph (a) above.

 

(c)           A
Member may change his designation of the event which entitles him to
distribution of his entire Account provided that such election shall not be
effective until the January 1 of the second calendar year following the
calendar year in which such election is received by the Committee and provided
payment would not otherwise be made prior to the effective date.

 

5.02        Method
of Payment

 

(a)           A
Member’s Account shall be distributed to him, or in the event of his death to
his Beneficiary, in a cash single sum payment. Notwithstanding the foregoing, a
Member may elect to receive distribution of his Account in installments over a
period not to exceed ten (10) years installments shall be payable as of January
1 and July 1, and the amount of each installment shall equal the balance in the
Account as of the Valuation Date of determination, divided by the number of
remaining installments (including the installment being determined). The
election of a form of payment shall be made on the Member’s initial Deferral
Agreement and shall be irrevocable except as provided in paragraph (b) below.
An Eligible Executive who is a Member on December 31, 1996 shall be deemed to
have elected payment in a lump sum.

 

(b)           Notwithstanding
paragraph (a) above, a Member or former Member may change the form in which his
Account is distributed, no more than once in any calendar year, by filing with
the Committee an amendment to his Deferral Agreement. The change shall be
limited to those

 

16

 

forms of distribution described in paragraph (a) above, shall be
subject to approval of the Committee and shall be effective as of the January 1
of the second calendar year following the calendar year in which such election
is received by the Committee.

 

5.03        Hardship

 

(a)           While
employed by the Bank, a Member may, in the event of a severe financial
hardship, request a withdrawal from his Account. The request shall be made in a
time and manner determined by the Committee, shall not be for a greater amount
than the lesser of (i) the amount required to meet the financial hardship, or
(ii) the amount of his Account, and shall be subject to approval by the
Committee.

 

(b)           For
Purposes of this Section 5.03, financial hardship shall include:

 

(i)            sudden
and unexpected illness or accident of the Member or his dependents, resulting
in severe financial hardship to the Member;

 

(ii)           loss
of the Member’s personal property due to a casualty;

 

(iii)          any
other extraordinary and unforeseeable circumstances of the Member arising as a
result of events beyond the control of the Member and approved by the Committee
if such circumstances would result in a present or impending critical financial
need which the Member is unable to satisfy with funds reasonably available from
other sources.

 

17

 

5.04        Death Benefit

 

In the event a Member dies in service or after terminating service but
prior to receiving his entire Account balance, any balance remaining in his
Account shall be paid in one lump sum payment to his Beneficiary as soon as
practicable after the Valuation Date coincident with or next following his date
of death.

 

5.05        Designation of Beneficiary

 

(a)           Each
Member of the Plan may file with the Committee 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 his death. The Member may, from time to time,
revoke or change his Beneficiary designation without the consent of any prior
Beneficiary by filing a new designation with the Committee. The last such
designation received by the Committee shall be controlling; provided, however,
that no designation, or change or revocation thereof, shall be effective unless
received by the Committee prior to the Member’s death, and in no event shall it
be effective as a date prior to such receipt.

 

(b)           If
no such Beneficiary designation is in effect at the time of a Member’s death,
or if no designated Beneficiary survives the Member, or if, in the opinion of
the Committee, such designation conflicts with applicable law, the Member’s
estate shall be deemed to have been designated his Beneficiary and shall be
paid the amount, if any, payable under the Plan upon the Member’s death. If the
Committee is in doubt as to the right of any person to receive such amount, the
Committee may retain such amount, without liability for any interest thereon,
until the rights thereto are determined, or the Committee may pay such amount
into

 

18

 

any court of appropriate jurisdiction and such payment shall be a
complete discharge of the liability of the Plan and the Bank therefor.

 

5.06        Status
of Accounts Pending Distribution

 

Pending distribution, a terminated Member’s Account shall continue to
be credited with earnings and losses as provided in Article IV. The former
Member shall be entitled to change his investment election under Section
4.03(b) to the same extent as if he were a Member of the Plan.

 

5.07        Installments
and Withdrawals Pro-Rata

 

In the event of an installment payment or hardship withdrawal, such
payment or withdrawal shall be made on a pro-rata basis based on the portion of
the Member’s existing applicable Account balance which is subject to different
measures of investment performance.

 

19

 

ARTICLE VI.
SUBACCOUNTS

 

6.01        Qualification
for Post-Secondary Education Subaccount

 

An Employee may request that the Committee establish a Post-Secondary
Education Subaccount for the Provision of the costs and expenses of providing
post-secondary education for any person who is a Qualifying Student by duly
completing, executing, and filing with the Committee such request on an appropriate
form designated by the Committee. The Committee may condition its approval of
any Post-Secondary Education Subaccount upon such evidence to the Committee as
the Committee may deem appropriate. A separate Post-Secondary Education
Subaccount shall be established for each Qualifying Student approved by the
Committee. Each Post-Secondary Education Subaccount the Committee approves for
an Employee shall be established as of the start of the calendar year following
the calendar year during which the Committee’s approval occurs; provided however, that in the event the Committee’s approval
for a Post-Secondary Education Subaccount occurs after December 14 of a
calendar year, then such Post-Secondary Education Subaccount shall be
established as of the start of the second calendar year following the calendar
year during which such Committee approval occurred. The portion of an
Employee’s Account not credited to one or more of his or her Post-Secondary
Education Subaccounts is the Employee’s Retirement Subaccount.

 

6.02        Treatment
of Subaccounts

 

Except as provided in the following provisions of this Article 6, each
Subaccount of an Employee shall be treated as a separate Account under the
Plan.

 

20

 

6.03        Modification
of Plan Provisions Applying to Subaccounts

 

(a)           Respecting Article III of the Plan Involving Payments to the Plan.
The overall limits on the maximum amounts of elective and incentive
compensation contribution additions under Section 3.04 and 3.05 shall apply
with respect to all of the Employee’s Subaccounts as if all such Subaccounts
were a single Account under the Plan. A Member may designate the total amount
and allocation of elective contribution additions, incentive compensation
contribution additions, and matching contribution additions among his
Subaccounts by completing, executing, and filing with the Committee the
appropriate form designated by the Committee by December 15 of the calendar
year before the calendar year in which the change is to be effective. However,
no contribution additions may be allocated to a Post-Secondary Education
Subaccount following the date designated for distribution of such Subaccount
under paragraph (b) below. In the event a Member evidences severe financial
hardship for a year, then all Deferrals to all of the Member’s Subaccount’s
shall be stopped.

 

(b)           Respecting Article V of the Plan Involving Distribution and Withdrawals
to Members. The distribution event date for each of the Employee’s
Post-Secondary Education Subaccount shall be any distribution event date
irrevocably specified by the Employee that is no less than three years
following the date the first amount is actually credited to that Post Secondary
Education Subaccount, upon daily completing, executing, and filing with the
Committee the appropriate form designated by the Committee no later than the
time such Post-Secondary Education Subaccount is established, provided,
however, that notwithstanding the distribution date elected by the Member, in
no event may payment

 

21

 

under this paragraph (b) commence later than the date payments comments
under Section 5.01. No later than the establishment of a Post-Secondary
Education Subaccount by an Employee for a Qualifying Student, the Employee
shall also irrevocably designate for such Subaccount on such form a semi-annual
installment form of payment for a period that is not less than eight
semi-annual installments and no more than 12 semi-annual installments. Separate
elections under the foregoing provisions of this Section 6.03(b) will be made
for each Post-Secondary Education Subaccount established for an Employee. No
withdrawals before the distribution event date may be made from any
Post-Secondary Education Subaccount except as provided in Section 5.03. In the
event an Employee fails to designate either the timing or form of distribution
of any Post-Secondary Education Subaccount established for the Employee, then
any amounts that are or would have been allocated to such Subaccount shall be
credited instead to the Member’s Account or Retirement Subaccount, as the case
may be. All of an Employee’s Subaccounts shall be treated as a single Account
under the Plan for purposes of any death benefit payable under the Plan.

 

6.04        Special
Rules for Post-Secondary Education Subaccounts

 

A Member may elect to dissolve any Post-Secondary Education Subaccount
be elected to establish for a Qualifying Student and to transfer the balance of
that Subaccount in multiples of 10 percent of such balance to his other
Subaccounts, or 100 percent of such balance to his Account, as the case may be,
duly completing, executing, and filing with the Committee an appropriate form
designated by the Committee; provided

 

22

 

however, that for an
election to dissolve a Post-Secondary Education Subaccount to be effective, a
full calendar year must pass between the calendar year during which the Member
duly makes to dissolution election and the calendar year during which
distribution of any portion of such Post-Secondary Education Subaccount is
first to become payable; and provided  further that in the absence of such elective allocation of
the balance of the Post-Secondary Education Subaccount upon its dissolution,
that balance shall be transferred in its entirety to the Employee’s Account or
Retirement Subaccount, as the case may be. In no other event may transfers be
made among the Member’s Subaccounts.

 

6.05        Special
One-Time Election

 

Notwithstanding the provisions of Sections 6.01 and 6.03, a Member on
August 1, 2000, whose distribution date in effect under Section 5.01 is on or
after January 1, 2002, may elect during the 45 day period commencing on August
1, 2000 to establish one or more Post-Secondary Education Subaccounts effective
as of October 1, 2000, and to specify the percentage of the remaining elective
contribution additions, for the 2000 Plan Year to be allocated to such
Subaccount(s). In addition, such Member may elect during the 45-day election
period to transfer all or a portion of his then existing Account balance
attributable to elective contribution additions, incentive compensation
contribution additions and matching contribution additions to such
Post-Secondary Education Subaccount(s). Commencing October 1, 2000, only
subsequent contributions may be allocated to a Post-Secondary Education
Subaccount in accordance with the provisions of Section 6.01 and 6.03.

 

23

 

ARTICLE VII. SOURCE OF
PAYMENTS

 

7.01        All
payments of benefits under the Plan shall be paid from, and shall only be a
general claim upon, the general assets of the Bank, notwithstanding that the
Bank, in its discretion, may establish a bookkeeping reserve or a grantor trust
(as such term is used in Code Sections 671 through 677) to reflect or to aid it
in meeting its obligations under the Plan with reflect to any Member or
prospective Member or beneficiary. No benefit whatever provided by the Plan
shall be payable from the assets of the Thrift Plan.

 

7.02        No
Member shall have any right, title or interest whatever in or to any
investments which the Bank may make or any specific assets which the Bank may
reserve to aid it in meeting its obligations under the Plan. To the extend that
any person acquires a right to receive payments from the Bank under the Plan,
such right shall be no greater than the right of an unsecured general creditor
of the Bank.

 

24

 

ARTICLE VIII. ADMINISTRATION OF THE PLAN

 

8.01        The
Committee shall have general authority over and responsibility for the
administration and interpretation of the Plan. The Committee shall have full
power and discretionary authority to interpret and construe the Plan, to make
all determinations considered necessary or advisable for the administration of
the Plan and any trust refereed to in Article VII, and the calculation of the
amounts of benefits payable thereunder, and to review claims for benefits under
the Plan. Unless arbitrary or capricious, the Committee’s interpretations and
constructions of the Plan and its decisions or actions thereunder shall be
binding and conclusive on all persons for all purposes.

 

8.02        If
the Committee deems it advisable, it shall arrange for the engagement of legal
counsel and certified public accountants (who may be counsel or accountants for
the Bank), and other consultants, and make use of agents and clerical or other
personnel, for purposes of the Plan. The Committee may rely upon the written
opinions of such counsel, accountants and consultants, and upon any information
supplied by the Thrift Plan for purposes of Sections 3.01, 3.02 and 3.03 of the
Plan, and delegate to any agent or to any sub-committee or Committee member its
authority to perform any act hereunder, including without limitations those
matters involving the exercise of discretion; provided, however, that such
delegation shall be subject to revocation at any time at the discretion of the
Committee. The Committee shall report to the Board of Directors, or to a
committee designated by the Board, at such intervals as shall be specified by
the Board of such designated committee, with regard to the matters for which it
is responsible under the Plan.

 

25

 

8.03        No
Committee member shall be entitled to act on or decide any matters relating
solely to such member or any of his rights or benefits under the Plan.

 

8.04        The
Committee member shall be reimbursed for any reasonable expenses incurred in
connection with his services as a Committee member. No bond or other security
bond be required of the Committee or any member
thereof in any jurisdiction.

 

8.05        All
Claims for benefits under the Plan shall be submitted in writing to the
Chairman of the Committee. Written notice of the decision on each such claim
shall be furnished with reasonable promptness to the Member or his Beneficiary
(the claimant). The claimant may request a review by the Committee of any
decision denying the claim in whole or in part. Such request shall be made in
writing and filed with the Committee within 30 days of such denial. A request
for review shall contain all additional information which the claimant wishes
the Committee to consider. The Committee may hold any hearing or conduct any
independent investigation which it deems desirable to render its decision, and
the decision on review shall be made as soon as feasible after the Committee’s
receipt of the request for review. Written notice of the decision on review
shall be furnished to the claimant. For all purposes under the Plan, such
decisions on claims (where no review is requested) and decisions on review
(where review is requested) shall be final, binding and conclusive on all
interested persons as to all matters relating to the Plan.

 

8.06        All
expenses incurred by the Committee in its administration of the Plan shall be
paid by the Bank.

 

26

 

ARTICLE IX. AMENDMENT AND TERMINATION

 

9.01        The
Board of Directors may amend, suspend or terminate, in whole or in part, the
Plan without the consent of the Committee, any Member, beneficiary or other
person, except that no amendment, suspension or termination shall retroactively
impair or otherwise adversely affect the rights of any Member, Beneficiary or other
person to benefits under the Plan which have accrued prior to the date of such
action, as determined by the amendment or take any other action which may be
necessary or appropriate to facilitate the administration, management and
interpretation of the Plan or to conform the Plan thereto, provided any such
amendment or action does not have a material effect on the then currently
estimated cost to the Bank of maintaining the Plan.

 

27

 

ARTICLE X. GENERAL PROVISIONS

 

10.01      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.

 

10.02      Neither
the Plan nor any action taken thereunder shall be construed an giving to a
Member the right to be retained in the employ of the Bank or as affecting the
right of the Bank to dismiss any Member from its employ.

 

10.03      The
Bank shall withhold or cause to be withheld from all benefits payable under the
Plan all federal, state, local or other taxes required by applicable law to be
withheld with respect to such payments.

 

28

 

10.04      No
right or interest of a Member under the Plan may be assigned, sold, encumbered,
transferred or otherwise disposed of and any attempted disposition of such
right or interest shall be null and void. Further, no right or interest of a
Member may be reached by any creditor of the Member.

 

10.05      If
the Committee shall find that any person to whom any amount is or was payable
under the Plan is unable to care for his affairs because of illness or accident
or because he is a minor, then any payment, or any part thereof, due to such
person (unless a prior claim therefor has been made by a duly appointed legal
representative), may, if the Committee is so inclined, be paid to such person’s
spouse, child or other relative, an institution maintaining or having custody
of such person, or any other person deemed by the Committee to be a proper
recipient on behalf of such person otherwise entitled to payment. Any such
payment shall be in complete discharge of the liability of the Plan and the
Bank therefor.

 

10.06      All
elections, designations, requests, notices, instructions, and other
communications from a Members, beneficiary or other person to the Committee
required or permitted under the Plan shall be in such formats is prescribed
from time to time by the Committee and shall be mailed by first class mail or
delivered to such locations shall be specified by the Committee and shall be
deemed to have been given and delivered only upon actual receipt thereof at
such location.

 

10.07      The
benefits payable under the Plan shall be in addition to all other benefits
provided for employees of the Bank and shall not be deemed salary or other
compensation by the Bank for

 

29

 

the purpose of computing benefits to which he may be entitled under any
other plan or arrangement of the Bank.

 

10.08      No
Committee member shall be personally liable by reason for 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 in
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.

 

10.09      As
used in the Plan, the masculine gender shall be deemed to refer to the
feminine, and the singular person shall be deemed to refer to the plural,
whenever appropriate.

 

10.10      The
captions preceding the Sections of the Plan have been inserted solely as a
matter of convenience and shall not in any manner define or limit the scope or
intent of any provisions of the Plan.

 

10.11      The
Plan shall be continued according to the laws of the State of Massachusetts in
effect from time to time.

 

30

 

IN WITNESS WHEREOF, THE FEDERAL HOME LOAN BANK OF BOSTON
has caused this restatement of the Plan to be executed effective as of
                                .

 

 

	
   

  	
  THE FEDERAL HOME LOAN BANK

  OF BOSTON

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
						

 

	
  Attest:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

31

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