Document:

EXHIBIT 10.1.2

 

AMENDMENT TO OFFER LETTER

 

EXECUTIVE OFFICER

CHANGE IN CONTROL AGREEMENT

 

This
Agreement (this “Agreement”) is entered into as of the 18th day of May  ,
2009, by and between the FEDERAL HOME LOAN BANK OF BOSTON, a corporation
organized under the laws of the United States (the “Bank”) and Edward A.
Hjerpe, III (the “Executive”).

 

WHEREAS,
the Executive is expected to commence employment as the President and Chief
Executive Officer of the Bank, effective June 30, 2009, or before  ,
2009, and the Bank desires to provide the Executive with certain severance
benefits in the event of a Reorganization (as defined below) of the Bank.

 

NOW,
THEREFORE, in consideration of the promises and the mutual agreements herein
contained, the Bank and the Executive hereby agree as follows:

 

1.                                      Definitions.

 

(a)                                  “Bank”
shall mean the Federal Home Loan Bank of Boston and any other entity within the
definition of “Bank” in Section 5(a) hereof.

 

(b)                                 “Cause”
shall mean (i) the continued failure of the Executive to perform his
duties with the Bank (other than any such failure resulting from disability
(within the meaning of the Bank’s long-term disability plan), after a demand
for performance, pursuant to a resolution of the Bank’s Board of Directors, is
delivered to the Executive by the Chair of the Board of Directors of the Bank,
which specifically identifies the manner in which the Executive has not
performed his duties; (ii) the personal dishonesty, incompetence, willful
misconduct, gross negligence, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, or willful violation of
any law, rule or regulation (other than routine traffic violations or
similar offenses); or (iii) the removal of the Executive for cause by the
Federal Housing Finance Agency or any successor thereto (the “Finance Agency”)
pursuant to 12 U.S.C. 1422b(a)(2) or regulations promulgated thereunder,
any successor or similar statute to 12 U.S.C. 1422b(a)(2) or regulations
promulgated thereunder.

 

(c)                                  “Covered Termination”
shall have the meaning set forth in Section 2(a).

 

(d)                                 “Covered
Termination Period” means the period commencing with the execution by the
Bank of a Reorganization Agreement, and ending on the earlier of (i) twelve
(12) months after the effective date of the related Reorganization or (ii) the
date the Bank formally withdraws from the related Reorganization.

 

(e)                                  “Good Reason”
shall mean the occurrence of any of the following events during the Covered
Termination Period:

 

(i)                                   (A) a
material diminution in the Executive’s base compensation as in effect
immediately prior to the beginning of the period or as the same may

 

 

be increased from time to
time thereafter or (B) a material diminution in the Executive’s authority,
duties or responsibilities as in effect immediately prior to the beginning of
the period;

 

(ii)                                any material
breach of this Agreement by the Bank; or

 

(iii)                             any change in
the geographic location of the Bank or any successor entity to the Bank by more
than fifty (50) miles.

 

(f)                                    “Reorganization”
of the Bank shall mean the occurrence at any time of any of the following
events:

 

(i)                                   The Bank is
merged or consolidated with or reorganized into or with another bank or other
entity and the Bank is not the surviving entity;

 

(ii)                                The Bank sells
or transfers all, or substantially all of its business and/or assets to another
entity; or

 

(iii)                             The liquidation
or dissolution of the Bank;

 

provided,
that the term “Reorganization” shall include any Reorganization that is
mandated by federal statute, rule, regulation or directive and shall exclude
any Reorganization that is the result of Finance Agency supervisory guidance or
enforcement action taken pursuant to 12 C.F.R. Part 908 or any successor
regulation thereto.

 

(g)                                 “Reorganization
Agreement” means a definitive agreement, the full performance of which
would result in a Reorganization of the Bank.

 

(h)                                 “Release
Agreement” shall mean the Bank’s standard release of claims agreement
executed by the Bank and the Executive under which the Executive releases the
Bank from any and all claims based on losses, damages, liabilities, actions,
suits, costs, expenses, disbursements, taxes and penalties of any kind and
nature whatsoever arising due to the Executive’s employment with the Bank.

 

(i)                                     “Termination
of Employment” shall mean means the severing of employment with the Bank,
voluntarily or involuntarily, for any reason whatsoever, determined in
accordance with the provisions of Internal Revenue Code Section 409A.

 

2.                                      Covered Termination.

 

(a)                                  Covered Termination. For purposes
of this Agreement, a “Covered Termination” means a Termination of Employment
during the Covered Termination Period:

 

(i)                                   By the
Executive for a Good Reason that is not remedied within the cure periods
described in this Section 2(a); or

 

2

 

(ii)                                By the Bank, or
by its successor in a Reorganization, without Cause;

 

provided, that in the case
of a Termination of Employment by the Executive for Good Reason, the Executive
must first provide written notice to the Bank within ninety (90) days of
the initial existence of Good Reason describing the existence of such Good
Reason, and the Bank shall thereafter have the right to remedy the Good Reason
within thirty (30) days of the Bank’s receipt of such written notice. If
the Bank remedies the condition within such thirty (30) day cure period,
then no Good Reason shall be deemed to exist with respect to such condition. If
the Bank does not remedy the condition within such thirty (30) day cure
period, then the Executive may deliver a Notice of Termination for Good Reason
at any time within sixty (60) days following the expiration of such cure
period.

 

(b)                                 Non-Covered
Termination. For the avoidance of doubt, none of the following
events shall result in any payment to the Executive for a Covered Termination
under Section 3(a):

 

(i)                                   A Termination
of Employment by the Executive without Good Reason;

 

(ii)                                A Termination
of Employment for Cause by the Bank or its successor in a Reorganization;

 

(iii)                             A Termination
of Employment without Cause that does not occur within the Covered
Termination Period; or

 

(iv)                            A Termination
of Employment due to death, disability (within the meaning of the Bank’s
long-term disability plan) or a voluntary retirement.

 

3.                                      Payment for Covered Termination.

 

(a)                                  In the event of
a Covered Termination, subject to the Executive’s execution of a Release
Agreement no later than twenty-one (21) days (or, at the discretion of the
Bank, up to forty-five (45) days) after the Executive’s Termination of
Employment and non-revocation of such Release Agreement, the Bank shall pay the
Executive an amount equal to one (1) times the annualized base salary of
the Executive at the time of the Executive’s Termination of Employment with the
Bank (or, if higher, upon an event constituting Good Reason). Such amount shall
be distributed to the Executive in equal installments over twelve (12) months
following the Termination of Employment, to be paid according to the Bank’s
regular payroll cycle during such period.

 

(b)                                 Notwithstanding
Section 3(a), if the Bank is not in compliance with any applicable
statutory or regulatory capital or leverage requirements or if the payment
would cause the Bank to fall below applicable statutory or regulatory
requirements, then such payments shall be deferred until such time as the Bank
or any successor achieves compliance with its statutory and regulatory
requirements. The Bank shall make such payments at the earliest date at which
the Bank

 

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reasonably anticipates that
the making of the payments will not cause a violation of the statutory and
regulatory requirements described in this paragraph.

 

(c)                                  The Executive
shall be responsible for the payment of all federal, state and local income
taxes which may be due with respect to any payments made to the Executive
pursuant to this Agreement.

 

(d)                                 The payment of
severance benefits pursuant to this Section 3 shall be in lieu of any
severance benefits that would otherwise be payable to the Executive under any
severance plan or policy maintained by the Bank during the Covered Termination
Period.

 

(e)                                  The Executive
acknowledges that the Bank will comply with any applicable statutory and/or
regulatory requirements relating to the payment of the amounts under this Section 3.
Should a governmental authority, or a court upon application by a governmental
authority, having jurisdiction over the matter direct that any portion or all
of the amounts provided in this Section 3 may not be paid to the Executive
by the Bank, the Executive agrees that (i) he will not be entitled to
payments under this Section 3 to the extent that such payments would
violate any statutory and/or regulatory requirements that apply to the Bank,
and (ii) if previously paid, he will return to the Bank the amount of such
payment specified in such order, without adjustment for investment earnings or
losses, net of applicable taxes the Executive paid on such payment.  Such
repayment shall be made to the Bank within fifteen (15) business days after
written demand by the Bank is delivered to the Executive.  If any
proceeding is commenced in which the legality of any of the payments made or to
be made under this Agreement is at issue, the Bank will provide the Executive
with written notice promptly after it has knowledge thereof.

 

4.                                      No Mitigation. The Executive
shall not be required to seek other employment, nor shall any payment made
under this Agreement be reduced by any compensation received from other
employment.

 

5.                                      Successor to the Bank.

 

(a)                                  This Agreement
is binding upon the successors and assigns of the Bank. The Bank and its
successors and assigns will require any successor or assign (whether direct or
indirect, in a Reorganization, by operation of law, or otherwise) to all or
substantially all of the business and/or assets of the Bank, to enter into a
written agreement in form and substance satisfactory to the Executive,
expressly, absolutely and unconditionally to assume and agree to perform this
Agreement in the same manner and to the same extent that the Bank would be
required to perform it if no such succession or assignment had taken place. In
the event of a Covered Termination, the Bank agrees that it shall pay or shall
cause such employer to pay any amounts owed to the Executive pursuant to Section 3
hereof.

 

4

 

As
used in this Agreement, “Bank” shall mean the Bank as defined herein and any
successor or assign to its business and/or assets as aforesaid which executes
and delivers the agreement provided for in this Section 5 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law. If at any time during the term of this Agreement the
Executive is employed by any corporation a majority of the voting securities of
which is then owned by the Bank, the term “Bank” shall include such employer.
Whether or not another entity becomes the successor or assign of the Bank under
this Agreement, the maximum amount which the Executive may receive from all
sources under this Agreement in a Covered Termination shall be the amounts set
forth in Section 3 hereof.

 

(b)                                 This Agreement
shall inure to the benefit of and be enforceable by the Executive’s personal
and legal representatives, executors, administrators, successors, heirs,
distributees, and legatees. If the Executive should die while any amounts are
still payable to him hereunder, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the
beneficiary designated by notice in writing executed by the Executive and filed
with the Bank, or failing such designation, to the Executive’s estate.

 

6.                                      Employment Rights. This Agreement
shall not confer upon the Executive any right to continue in the employ of the
Bank and shall not in any way affect the right of the Bank to dismiss or
otherwise terminate the Executive’s employment at any time and for any reason
with or without cause. This Agreement is not intended (a) to be an
employment agreement or (b) to define all aspects of the employment
relationship between the Bank and the Executive, including but not limited to
applicable employment or benefit policies of the Bank. To the extent there is
any conflict between the terms hereof and the terms of any employment or
benefit policies of the Bank, the terms of this Agreement shall control.

 

7.                                      Tax Withholding. The Bank will
withhold from any amounts payable to the Executive under this Agreement to
satisfy all applicable federal, state, local or other withholding taxes. All
amounts payable under Section 3(a) are considered “wages” to be
reported on Form W-2. The normal withholding rules for wages apply. To
the extent required, the Bank will also withhold any excise taxes owed under
Code Section 4999.

 

8.                                      Notice. For purposes of this
Agreement, notices and all other communications provided for in the Agreement
shall be in writing and shall be deemed to have been duly given when delivered
by hand, delivered by a nationally-recognized overnight courier service, or
mailed by United States registered mail, return receipt requested, postage
prepaid, as follows:

 

If
to the Bank:

 

Federal
Home Loan Bank of Boston

111
Huntington Avenue, 24th Floor

Boston,
MA 02199-7614

Attention:
Chair of the Board of Directors

 

5

 

With
a copy to the Chair of the Personnel Committee of the Board of Directors

 

If
to the Executive:

 

Mr. Edward
A. Hjerpe, III

(at
home address)

 

or
such other address as either party may have furnished to the other in writing
in accordance herewith. Any notice shall be effective upon receipt.

 

9.                                      Legal Fees and Expenses. The Bank shall
reimburse all reasonable out-of-pocket legal fees and expenses which the
Executive has actually incurred as a result of the Bank’s contesting in bad
faith the validity or enforceability of this Agreement or the calculation of
amounts payable hereunder, with the fees and expenses to be paid promptly by
the Bank and in any event no later than March 15th of the year immediately following the year in
which such fees and expenses were incurred.

 

10.                               Term. This Agreement shall become effective on the date the Executive
commences his employment with the Bank (the “Commencement Date”) and
shall terminate upon the Executive’s Termination of Employment (except to the
extent obligations remain following a Covered Termination).

 

11.                               Acknowledgement
of Public Filing Requirements. The Executive
hereby acknowledges and agrees that (i) the Executive’s position
constitutes a “named executive officer” within the meaning of Item 402(a)(3) of
Regulation S-K (or any successor regulation); and (ii) this Agreement is a
compensatory agreement that the Bank, as a Securities and Exchange Commission (“SEC”)
registrant, must file and describe in public filings with the SEC in accordance
with applicable securities laws and SEC regulations.

 

12.                               Miscellaneous.

 

(a)                                  No Modification. No provisions
of this Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing signed by the party or
parties hereto to be bound.

 

(b)                                 No Waiver. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.

 

(c)                                  Entire
Agreement. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not set forth expressly in this Agreement.

 

(d)                                 Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts (excluding 

 

6

 

conflict of laws
principles), except to the extent such law is preempted by the federal laws of
the United States.

 

(e)                                  Pleadings. Section or
paragraph headings contained herein are for convenience of reference only and
are not to be considered a part of this Agreement.

 

(f)                                    Validity. The
invalidity or unenforceability of any provisions of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.

 

(g)                                 Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same instrument.

 

 

IN
WITNESS WHEREOF, this Agreement is executed as of the date first written above
and is effective as of the Commencement Date.

 

 

	
  THE
  EXECUTIVE:

  	
   

  	
  FEDERAL
  HOME LOAN BANK OF BOSTON:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  
	
   /s/ 
  Edward A. Hjerpe III

  	
   

  	
   

  	
   /s/
  Jan A. Miller

  
	
   

  	
   

  	
   

  	
   

  
	
  Edward
  A. Hjerpe, III

  	
   

  	
   

  	
  Jan
  A. Miller 

  
	
   

  	
   

  	
   

  	
  Chair,
  Board of Directors

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  
	
   

  	
   

  	
   

  	
   /s/
  Mark E. Macomber

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Mark
  E. Macomber 

  Chair, Personnel Committee of the Board of Directors

  
					

 

7EXHIBIT 10.1.3

 

THE FEDERAL HOME LOAN BANK OF BOSTON

PENSION BENEFIT EQUALIZATION PLAN

(Effective January 1, 2009, as
amended April 15, 2009)

 

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, 2009 and is further amended on April 15, 2009;
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.

 

1.10                           “Effective Date”
means January 1, 2009.  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).

 

2

 

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.

 

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 

 

3

 

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 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.

 

4

 

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 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.

 

5

 

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)                              subject to the last
paragraph of Section 3.1, 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; provided, however, that in the case
of an individual who becomes a Member on or after January 1, 2009, or who first
becomes an Eligible Executive under clause (b) of Section 1.11 on or
after that date, only the Member’s years of service with the Bank
from initial date of employment with the Bank shall be so recognized; and

 

(v)                                 solely with respect to
Executive Officers whose most recent date of hire by the Bank is prior to January 9,
2006 and who have continuously been an Executive Officer since 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 any Executive Officer (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;

 

6

 

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.

 

If a Member (i) incurs a Termination of Employment and receives a
full distribution of his or her Supplemental Retirement Benefit, and (ii) is
later re-employed by the Bank and again becomes a Member, the Supplemental
Retirement Benefit that accrues following such re-employment shall be
calculated by disregarding any portion of his or her prior service with respect
to which the Member’s Supplemental Retirement Benefit distribution was
calculated.

 

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 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 

 

7

 

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 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.  Notwithstanding the foregoing, if any portion
of the Member’s “High-3 Salary” (or “High-5 Salary, if applicable) that is used
to determine the Member’s Non-Grandfathered Benefit was 

 

8

 

earned prior to the date
of the Member’s election, such election shall not be effective with respect to
any portion of his or her Non-Grandfathered Supplemental Retirement Benefit.

 

The Member’s
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 or the Member’s election is not effective for any reason, he or she
shall be deemed to have elected to have such benefit paid in a single lump sum
payment 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.

 

(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 

 

9

 

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 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 

 

10

 

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

 

(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.

 

11

 

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;

 

(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)                              subject to the
last paragraph of Section 4.1, 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; provided, however,
that in the case of an individual who becomes a Member on or after January 1,
2009, or who first becomes an Eligible Executive under clause (b) of Section 1.11
on or after that date, only the Member’s years of service with the Bank
from initial date of employment with the Bank shall be so recognized; and

 

(v)                                 solely with
respect to Executive Officers whose most recent date of hire by the Bank is
prior to January 9, 2006 and who have continuously been an Executive
Officer since 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 any Executive Officer (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 

 

12

 

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.

 

If a Member (i) incurs
a Termination of Employment and receives a full distribution of his or her
Supplemental Retirement Benefit, and (ii) is later re-employed by the Bank
and again becomes a Member, the Supplemental Survivor Benefit that accrues
following such re-employment shall be calculated by disregarding any portion of
his or her prior service with respect to which the Member’s Supplemental
Retirement Benefit distribution was calculated.

 

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 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.

 

13

 

4.4                                 Payment of
Non-Grandfathered Supplemental Survivor Benefits. 
The Non-Grandfathered Supplemental Survivor Benefit shall be paid to the
Member’s Beneficiary in a single lump sum as soon as practicable after the
Member’s death.

 

4.5                                 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;

 

(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;

 

14

 

(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 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 

 

15

 

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 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.

 

16

 

7.6                                 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 requested, such receipt and release shall be executed by the
Participant or Beneficiary no later than 90 days after the Participant’s
scheduled payment commencement date.  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.

 

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
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

 

17

 

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 4th day of May, 2009 by:

 

 

	
  /s/ Janelle K. Authur

  	
   

  	
  /s/ Ellen McLaughlin

  
	
  Janelle K. Authur

  	
   

  	
  Ellen McLaughlin

  
	
  Senior Vice President
  and Executive

  	
   

  	
  Senior Vice President
  and General Counsel

  
	
  Director of Human
  Resources

  	
   

  	
   

  

 

18

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