SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the fiscal year ended December 31, 1993 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from _______ to _______ Commission file number __________ A. Full title of the plan and the address of the plan, if different from that of the issuer named below: STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: STATE STREET BOSTON CORPORATION 225 Franklin Street Boston, Massachusetts 02110 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the Salary Savings Program Committee of State Street Boston Corporation has duly caused this annual report to be signed by the undersigned hereunto duly authorized. STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM Dated: May 31, 1994 By: s/George J. Fesus ------------------------------------ George J. Fesus Treasurer & Chief Financial Officer State Street Boston Corporation AUDITED FINANCIAL STATEMENTS AND SCHEDULES STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM Years ended December 31, 1993 and 1992 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM AUDITED FINANCIAL STATEMENTS AND SCHEDULES Years ended December 31, 1993 and 1992 CONTENTS Report of Independent Auditors . . . . . . . . . . . . . . . . .1 Audited Financial Statements Statements of Net Assets Available for Plan Benefits . . . . . .2 Statements of Changes in Net Assets Available for Plan Benefits.3 Notes to Financial Statements. . . . . . . . . . . . . . . . . .4 Schedules Assets Held for Investment . . . . . . . . . . . . . . . . . . 10 Transactions or Series of Transactions in Excess of 5% of the Current Value of Plan Assets . . . . . . . . . . . . . 11 REPORT OF INDEPENDENT AUDITORS Salary Savings Program Committee State Street Boston Corporation We have audited the accompanying statements of net assets available for plan benefits of the State Street Boston Corporation and Certain Related Companies Salary Savings Program (the Plan) as of December 31, 1993 and 1992, and the related statements of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan at December 31, 1993 and 1992, and the changes in its net assets available for plan benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment as of December 31, 1993, and transactions or series of transactions in excess of 5% of the current value of plan assets for the year then ended, are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and are not a required part of the financial statements. The supplemental schedules have been subjected to the auditing procedures applied in our audit of the 1993 financial statements and, in our opinion, are fairly stated in all material respects in relation to the 1993 financial statements taken as a whole. ERNST & YOUNG Boston, Massachusetts April 1, 1994 1 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS [NOTE: FINANCIALS ARE BEING SUBMITTED IN PAPER FORM UNDER COVER FORM-SE PURSUANT TO ITEM 311(C) OF REGULATION S-T.] 2 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS [NOTE: FINANCIALS ARE BEING SUBMITTED IN PAPER FORM UNDER COVER FORM-SE PURSUANT TO ITEM 311(C) OF REGULATION S-T.] 3 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1993 1. SIGNIFICANT ACCOUNTING POLICIES The accounting records of the State Street Boston Corporation and Certain Related Companies Salary Savings Program (the Plan) are maintained on the accrual basis. Investments are stated at fair value. Securities included in the Stock Fund, Company Stock Fund, Bond Fund and International Index Fund for Employee Trusts of State Street Bank and Trust Company are valued in the following manner. Investments listed on securities exchanges are valued at closing sales prices on the last business day of the year. In the case of unlisted securities, the valuation is the last published sales price, or the mean between the bid and asked price, whichever is more recent. Securities included in the Short-Term Investment Fund for Employee Trusts of State Street Bank and Trust Company are short-term instruments and are valued at cost, which approximates fair value. Investments in the Guaranteed Investment Fund for Employee Trusts of State Street Bank and Trust Company are units representing investments in guaranteed investment contracts of insurance companies which are rated AAA or AA by the major rating agencies. Most contracts range from one- to five-year maturities and provide a fixed rate of return. Contracts are valued at their stated contract value at maturity. The change in the difference between fair value and the cost of investments is reflected in the statement of changes in net assets available for plan benefits as unrealized appreciation (depreciation) in the fair value of investments. The realized gain or loss on sale of investments is the difference between the proceeds received and the average cost of investments sold. 2. DESCRIPTION OF THE PLAN The Plan is a defined contribution Plan. All full-time employees and employees who have completed one year of employment or 1,000 hours of service are eligible to participate in the Plan. Participants in the Plan are fully vested when they become members. Upon retirement or other termination of employment, employees may elect to defer the payment of their benefits and remain in the plan at which time the participants become nonactive. 4 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS (CONTINUED) 2. DESCRIPTION OF THE PLAN (CONTINUED) Active participants may elect to make tax deferred contributions to the Plan equal to 2%, 4%, 6%, 8%, 10% or 12% of their compensation, subject to certain limitations defined in the Tax Reform Act of 1986. Contributions to the Plan are made by the employer in amounts equal to 50% of the first 6% of the employee's tax deferred contribution. All contributions to the Plan are paid to State Street Bank and Trust Company which holds them in trust exclusively for participants and their beneficiaries, invests them and makes benefit payments as they become due. Effective January 1, 1989, all future employer contributions and earnings thereon are not available for hardship withdrawal. Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of plan termination, participants will be 100 percent vested in their accounts. 3. INVESTMENT FUNDS Each active participant may allocate the funds held in his or her account among five Investment Funds, the assets of which mainly consist of investments in pooled funds managed by State Street Bank and Trust Company. Nonactive participants may only invest in the Short-Term Investment Fund. A description of the Investment Funds follows: Stock Fund--The Fund is invested in a portfolio of common stocks and common stock equivalents. Company Stock Fund--The Fund is invested in shares of the common stock of State Street Boston Corporation. Short-Term Investment Fund--The Fund is invested in a portfolio of short-term money market instruments. Guaranteed Investment Fund--The Fund is invested in a portfolio of guaranteed investment contracts issued by insurance companies rated AA or AAA. 5 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS (CONTINUED) 3. INVESTMENT FUNDS (CONTINUED) International Index Fund--The Fund is invested in a portfolio of diversified foreign stocks. The following table summarizes the number of participants in each of the five Funds and the number of units and net asset value per unit each Fund has invested in the State Street Bank and Trust Company Investment Funds for Employee Trusts at December 31, 1993 and 1992: NUMBER NUMBER NET ASSET OF OF VALUE OF 1993 PARTICIPANTS UNITS UNIT - ---- ------------ ---------- ---------- Stock Fund Stock Fund 3056 580,639 34,228,697 Short-Term Investment Fund Company Stock Fund State Street Boston Corporation Common Stock 4958 1,961,107 73,541,513 Short-Term Investment Fund 1,187,000 1,187,000 Short-Term Investment Fund Short-Term Investment Fund 2434 33,613,000 33,613,000 Guaranteed Investment Fund Guaranteed Investment Fund 1764 12,999,086 12,999,086 Short-Term Investment Fund 196,000 196,000 International Index Fund International Index Fund 1716 313,849 8,235,424 Short-Term Investment Fund 245,000 245,000 6 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS (CONTINUED) 3. INVESTMENT FUNDS (CONTINUED) NUMBER NUMBER NET ASSET OF OF VALUE OF 1992 PARTICIPANTS UNITS UNIT - ---- ------------ ---------- ---------- Stock Fund 2,786 Stock Fund 507,328 $50.05 Short-Term Investment Fund 89,000 1.00 Company Stock Fund 5,107 State Street Boston Corporation Common Stock 1,873,061 43.75 Short-Term Investment Fund 709,000 1.00 Short-Term Investment Fund 2,398 Short-Term Investment Fund 34,899,000 1.00 Guaranteed Investment Fund 1,509 Guaranteed Investment Fund 8,591,535 1.00 Short-Term Investment Fund 40,000 1.00 International Index Fund 1,169 International Index Fund 215,371 19.81 Short-Term Investment Fund 179,000 1.00 7 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS (CONTINUED) 4. INVESTMENTS The net realized gain on sale of investments for the years ended December 31, 1993 and 1992 was as follows: STOCK FUND COMPANY STOCK FUND INTERNATIONAL INDEX TOTAL 1993 1992 1993 1992 1993 1992 1993 1992 -------------------- --------------------- ------------------- --------------------- Proceeds $2,934,320 $577,277 $14,246,594 $152,014 $3,215,047 $0 $20,395,961 $729,291 Average cost of investments 2,440,070 497,664 12,893,615 53,748 3,190,842 0 18,524,527 551,412 -------------------- --------------------- ------------------- --------------------- Net gain on sale of investments $ 494,250 $ 79,613 $ 1,352,979 $ 98,226 $ 24,205 $0 $ 1,871,434 $177,879 ==================== ===================== =================== ===================== The unrealized appreciation (depreciation) in fair value of investments for 1993 and 1992 was as follows: YEAR ENDED DECEMBER 31 1993 1992 --------------------------- Unrealized appreciation at beginning of year $63,291,704 $41,306,733 Unrealized appreciation at end of the year 56,449,214 63,291,704 --------------------------- Unrealized appreciation (depreciation) in fair value of investments $(6,842,490) $21,984,971 =========================== 8 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM NOTES TO FINANCIAL STATEMENTS (CONTINUED) 5. LOANS Under the provisions of the Plan, as amended, active participants may be granted loans from the assets of the Plan subject to the approval of the plan administrator. As of December 31, 1993, 1,248 active participants had loan balances outstanding. These loans are secured by the participant's account balance and carry a market rate of interest. All principal repayments and interest payments are made through payroll deduction and credited to the participant's account. The Plan accounts for loans in a special account separate from the five funds. 6. TRANSACTIONS AND AGREEMENTS WITH PARTIES-IN-INTEREST All costs and expenses incurred in connection with the operation of the Plan are borne by State Street Boston Corporation. 7. INCOME TAX STATUS The Plan as originally established was ruled by the Internal Revenue Service to qualify under Section 401 of the Internal Revenue Code and to be tax exempt under Section 501. Contributions by participants to this Plan were made out of their after-tax earnings and were not deductible by them. The Plan was amended effective October 1, 1983 to conform to the provisions of Section 401(k) whereby participants are now allowed to allocate up to 12% of their gross earnings as their contribution to the Plan. Participants are not taxed on either the employer's or their own contributions or on any plan earnings with respect to funds held in their accounts until these amounts are withdrawn or distributed. Distributions to, or withdrawals by a participant of amounts contributed prior to October 1, 1983, are currently taxable to him or her (unless transferred to an Individual Retirement Account qualified or another qualified plan under Section 408 of the Internal Revenue Code within 60 days of receipt) to the extent they represent an amount other than the Participant's own contributions, and are not taxable to the Participants to the extent they represent a return of their own contributions. The Plan, as amended above, received a favorable determination from the Internal Revenue Service and, therefore, the Plan is not subject to taxation under present income tax laws. 9 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM ASSETS HELD FOR INVESTMENT DECEMBER 31, 1993 DESCRIPTION CURRENT IDENTITY OF ISSUE OF INVESTMENT COST VALUE - --------------------------------------------------------------------------- State Street Bank and Trust Company Investment Funds for Employee Trusts: Matrix Stock Fund 580,639 units of participation $ 25,040,612 $ 34,228,697 Company Stock Fund 1,961,107 units of participation 27,435,147 73,541,513 Short-Term Investment 35,271,000 units of Fund participation 35,271,000 35,271,000 Guaranteed Investment 12,999,086 units of Fund participation 12,999,086 12,999,086 International Index 313,849 units of Fund participation 7,080,650 8,235,424 --------------------------- $107,826,495 $164,275,720 =========================== 10 STATE STREET BOSTON CORPORATION AND CERTAIN RELATED COMPANIES SALARY SAVINGS PROGRAM TRANSACTIONS OR SERIES OF TRANSACTIONS IN EXCESS OF 5% OF THE CURRENT VALUE OF PLAN ASSETS YEAR ENDED DECEMBER 31, 1993 CURRENT VALUE OF COST OF ASSET ON PURCHASE SELLING ASSET TRANSACTION NET GAIN IDENTITY OF PARTY INVOLVED DESCRIPTION OF ASSET PRICE PRICE SOLD DATE (LOSS) - ------------------------------------------------------------------------------------------------------------------------------------ Category (iii) - Series of securities transactions in excess of 5% of plan assets. State Street Bank and Trust Company - Short-Term 28,223,000 units of Investment Fund participation $28,223,000 $28,223,000 State Street Bank and Trust Company - Short-Term 29,053,000 units of Investment Fund participation $29,053,000 $29,053,000 S&P Matrix Stock Fund 114,359 units of participation 6,148,626 6,148,626 41,042 units of participation 2,209,320 1,715,070 $ 494,250 State Street Bank Stock Fund 176,164 units of participation 6,370,264 6,370,264 88,118 units of participation 2,631,649 1,278,670 1,352,979 Guaranteed Investment 7,243,489 units of Fund participation 7,243,489 7,243,489 2,835,938 units of participation 2,835,938 2,835,938 There were no category (i), (ii) or (iv) reportable transactions during 1993. 11 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in Post-Effective Amendment Number 2 to the Registration Statement (Form S-8 No. 2-68696) pertaining to State Street Boston Corporation, of our report dated April 1, 1994 with respect to the financial statements and schedules of State Street Boston Corporation and Certain Related Companies Salary Savings Program included in this Annual Report (Form 11-K) for the year ended December 31, 1993. ERNST & YOUNG Boston, Massachusetts May 26, 1994 12