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Exhibit 10.10
BOSTON FEDERAL SAVINGS BANK
DEFINED BENEFIT RESTORATION PLAN
(EFFECTIVE AS OF SEPTEMBER 21, 1999)
1. PURPOSE. The purpose of the Plan is to (a) attract and retain
certain key executive employees of Boston Federal Savings Bank and certain of
its subsidiaries and affiliates by providing them with supplemental retirement
income (determined by reference to the FIRF Plan (as defined below)) to augment
their qualified plan retirement benefits by, for purposes of the Plan only, (a)
eliminating the effect of the limitations contained in Sections 401(a)(17) and
415 of the Internal Revenue Code of 1986, as amended and in effect from time to
time (the "Code"), on the benefits provided under the FIRF Plan, and (b)
eliminating the effect of the early retirement factors applicable to benefits
payable under the FIRF Plan. The Plan shall be construed consistent with the
purposes described herein.
2. DEFINITIONS. The following terms shall have the following
meanings for purposes of the Plan:
2.1 "ACCELERATION PAYMENT" means a lump sum acceleration
payment, as defined in Section 7 hereof.
2.2 "ACCRUED BENEFIT" means, as of any date, (i) in the
case of a Participant who has not yet retired, become disabled or otherwise
terminated employment with the Employer, the Benefit which would be payable to
such Participant under the Plan had he retired, become disabled or otherwise
terminated employment with the Employer on such date, and (ii) in the case of a
Participant who has retired, become disabled or otherwise terminated employment
with the Employer, the Benefit.
2.3 "BENEFIT" means the supplemental benefit provided by
the Plan, as defined in Section 5 hereof.
2.4 "BFSB" means Boston Federal Savings Bank, a
federally chartered stock savings bank, and any successor entity(ies) thereto.
2.5 "BFSB BOARD" means the board of directors of BFSB or
a committee of the board of directors of BFSB authorized to act on behalf of the
board of directors of BFSB under this Plan.
2.6 "CHANGE IN CONTROL" means, with respect to a
Participant who has an Employment Agreement, a "Change in Control" as defined in
such Participant's Employment Agreement.
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2.7 "CODE" means the Internal Revenue Code, as defined in
Section 1 hereof.
2.8 "DEATH BENEFIT" means the death benefit provided by
the Plan, as defined in Section 8 hereof.
2.9 "EARLY TAX OBLIGATION" means the early tax
obligation, as described in Section 15 hereof.
2.10 "ELECTION DATE" means the date on which a Participant
submits an election to receive an Acceleration Payment.
2.11 "EMPLOYER" means BFSB and any subsidiary or affiliate
of BFSB which participates in the FIRF Plan and which adopts this Plan with the
permission of the BFSB Board. References to the Employer or the Employer Board
in the context of a particular Participant shall refer to that Participant's
Employer and its board of directors (or authorized committee thereof).
2.12 "EMPLOYER BOARD" means, with respect to an Employer,
the board of directors of such Employer or a committee of the board of directors
of such Employer authorized to act on behalf of such board of directors under
this Plan.
2.13 "EMPLOYMENT AGREEMENT" means, with respect to a
Participant, any employment, change in control or similar agreement between such
Participant and his Employer.
2.14 "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended and in effect from time to time.
2.15 "EVENT OF TERMINATION" means, with respect to a
Participant who has an Employment Agreement which defines such term, an "Event
of Termination" as defined in such Participant's Employment Agreement.
2.16 "FIRF PLAN" means the Financial Institutions
Retirement Fund, as amended from time to time, and as adopted by the Employer.
2.17 "INSURANCE PROCEEDS" means that portion of the
proceeds of any split-dollar life insurance policy collaterally assigned to the
Participant but only to the extent such proceeds are designated in advance by
the Employer as Insurance Proceeds hereunder. The Employer shall at all times
maintain a record identifying all such policies and the extent to which proceeds
thereunder will constitute Insurance Proceeds. Such records shall be binding and
conclusive for all purposes of the Plan and upon all Participants and any
person(s) claiming under, through or in respect of any Participant.
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2.18 "INTEREST RATE" means, for any calendar year,
interest compounded annually at the rate of 120 percent of the applicable
Federal mid-term rate as in effect under Section 1274 of the Code for the first
month of such year.
2.19 "PARTICIPANT" means David F. Holland, David P.
Conley, John A. Simas, and such other senior executives of the Employer as are
selected for participation in the Plan from time to time by the Employer Board.
Notwithstanding the foregoing, no person shall be a Participant until such
person executes and delivers to the Employer Board a Participation Agreement.
2.20 "PARTICIPATION AGREEMENT" means a participation
agreement in the form attached hereto as Exhibit A.
2.21 "PLAN" means the Boston Federal Savings Bank Defined
Benefit Restoration Plan, as set forth herein and as amended from time to time.
2.22 "PRESENT VALUE" means the present value of a future
(or past) lump sum payment or a series of future (or past) installment payments
determined by discounting (or accreting) such future (or past) payment(s) to the
determination date at an annually compounded rate equal to the Interest Rate.
3. ADMINISTRATION.
3.1 Subject to Sections 2.16, 3.2, 13(b) and 15 hereof,
the Plan shall be administered by the BFSB Board. Except as otherwise provided
in the Plan or by applicable law, the BFSB Board shall have full authority and
discretion to determine the rights and benefits of Participants under the Plan,
to establish from time to time regulations for the administration of the Plan,
to interpret and construe the Plan, and to make all determinations deemed
necessary or advisable for the administration of the Plan.
3.2 The BFSB Board may designate persons other than
members of the BFSB Board to carry out the day-to-day ministerial administration
of the Plan under such conditions and limitations as it may prescribe. The BFSB
Board's determinations under the Plan shall be reasonable and shall be
consistent with the provisions and purposes of the Plan; PROVIDED, HOWEVER,
that, subject to the foregoing, such determinations need not be uniform and may
be made selectively among Participants, whether or not such Participants are
similarly situated. Except as otherwise provided in the Plan or by applicable
law, any such determination, decision or action of the BFSB Board in connection
with the construction, interpretation, administration, implementation or
maintenance of the Plan shall be final, conclusive and binding upon all
Participants and any person(s) claiming under, through or in respect of any
Participant.
3.3 The BFSB Board and any Employer Board, and/or any
member of the BFSB Board and any Employer Board, shall not be liable to or in
respect of any Participant
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or to any other person for or in respect of any act, omission, interpretation,
construction or determination made in good faith in connection with or under the
Plan.
4. PARTICIPATION. Participation in the Plan shall be limited to
the Participants. This Plan is intended to constitute a non-qualified, unfunded
deferred compensation plan for a select group of management or highly
compensated employees under Title I of ERISA.
5. SUPPLEMENTAL RETIREMENT BENEFIT. In accordance with Section 6
hereof, the Employer shall pay in respect of each Participant a supplemental
benefit under the Plan (the "Benefit") in the form of two hundred forty (240)
equal monthly payments. The monthly amount of the Benefit shall be determined as
of the date such Benefit is to be paid or is to be commenced being paid, and
shall not be subject to further adjustment (e.g., the Benefit shall not be
adjusted to reflect any future cost of living adjustment under the FIRF Plan).
Each monthly payment shall be determined by the following formula:
X = A - B - C, where:
X = the amount of the monthly payment;
A = the accrued and vested monthly retirement benefit that would be
payable under the FIRF Plan, in the regular form of payment (i.e., assuming the
Participant was not married and made no election of any optional form of
payment), commencing at the later of age 65 or the Participant's date of
retirement or other termination of employment with the Employer, assuming, for
purposes of the Plan only, that the provisions of the FIRF Plan designed solely
to satisfy the requirements of Section 401(a)(17) and Section 415 of the Code
were deleted and of no effect;
B = such Participant's accrued and vested monthly retirement benefit
actually payable under the FIRF Plan, in the regular form of payment (i.e.,
assuming the Participant was not married and made no election of any optional
form of payment), commencing at the earlier of the date the Participant
commences receipt of his monthly Benefit under this Plan or the date the
Participant commences receipt of his benefit under the FIRF Plan; and
C = the monthly installment equivalent with respect to any Acceleration
Payment paid in respect of such Participant prior to his retirement or other
termination of employment with the Employer. The monthly installment equivalent
with respect to an Acceleration Payment shall be equal to 100% of the monthly
Benefit amount used in calculating the lump sum amount of such Acceleration
Payment.
In no event shall the Benefit be less than zero.
Notwithstanding anything to the contrary elsewhere herein, if a
Participant becomes entitled to benefits under his Employment Agreement on
account of either an Event of Termination or the termination of his employment
with the Employer after a Change in
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Control, then solely for purposes of determining A above, such Participant shall
be deemed to have three (3) additional years of Service (as defined in the FIRF
Plan).
6. PAYMENT OF BENEFIT. Upon thirty (30) days' prior written
notice to the Employer Board, the Participant may commence receipt of his
monthly Benefit payments on the first day of any month following the later of
the following:
6.1 such Participant's attainment of age 55; or
6.2 such Participant's retirement or other termination of
employment with the Employer.
Notwithstanding the foregoing:
6.3 in a situation where a Participant's employment with
the Employer terminates and such Participant is eligible for disability benefits
under the FIRF Plan, then the Benefit payable hereunder shall be determined in
accordance with Section 5 hereof taking into account the disability provisions
of the FIRF Plan. Such a disabled Participant may commence receipt of his
monthly Benefit payments on the first day of any month following the date such
Participant becomes disabled, as defined in the FIRF Plan, regardless of his age
at that time; and
6.4 in the event any payment to be made to a Participant
(or his designated beneficiary, as the case may be) under this Section 6 (or
Sections 7 or 8, as the case may be) has not been paid within 30 days after the
date such payment was to be made, the Employer shall (in addition to such
payment) pay to such Participant (or his designated beneficiary, as the case may
be) interest on the amount of such delinquent payment, from the date such
payment was to be paid through the date such payment was actually paid, at a
rate equal to the Interest Rate.
7. ACCELERATION PAYMENT. At any time, upon sixty (60) days' prior
written notice to the Employer Board, a Participant may elect to receive an
Acceleration Payment, PROVIDED, HOWEVER, that no more than one (1) such
Acceleration Payment may be paid with respect to a Participant before such
Participant retires, becomes disabled or otherwise terminates employment with
the Employer. Such Acceleration Payment shall be paid promptly by the Employer
to such Participant in a single lump sum. The amount of such Acceleration
Payment shall be determined in accordance with this Section 7.
7.1 If a Participant requests an Acceleration Payment
prior to the date he retires, becomes disabled or otherwise terminates
employment with the Employer, the amount of such Acceleration Payment shall
equal ninety percent (90%) of the Present Value of such Participant's Accrued
Benefit as of the Election Date. In all cases, the Present Value of such Accrued
Benefit shall be determined on the assumption that the Participant has
terminated his
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employment with the Employer on such date and elected to commence receipt of
such Accrued Benefit on the earliest date permitted by the Plan.
7.2 If a Participant requests an Acceleration Payment
after the date he retires, becomes disabled or otherwise terminates employment
with the Employer (including after commencing receipt of the Benefit), the
amount of such Acceleration Payment shall equal ninety percent (90%) of the
Present Value of the then unpaid monthly Benefit payments.
8. DEATH BENEFIT. Upon a Participant's death prior to the receipt
of his entire Accrued Benefit under the Plan, in lieu of any further Benefit
under the Plan and in lieu of any death benefit under any other non-qualified
plan of the Employer which pre-dates the effectiveness of the Plan, the Employer
shall make a single lump sum payment to such Participant's designated
beneficiary, or, if none, to such Participant's estate, equal to the Death
Benefit determined pursuant to this Section 8.
8.1 If a Participant dies prior to commencing receipt of
either or both of his monthly Benefit under the Plan and/or his benefit under
the FIRF Plan, the amount of such Death Benefit shall be determined by the
following formula:
Y = D - E - F - G, where:
Y = the amount of the Death Benefit;
D = the Present Value of any death benefit payable on account of such
Participant's death under the FIRF Plan, assuming, for purposes of the Plan
only, that the provisions of the FIRF Plan designed solely to satisfy the
requirements of Section 401(a)(17) and Section 415 of the Code were deleted and
of no effect;
E = the Present Value of the death benefit actually payable in respect
of such Participant's death under the FIRF Plan;
F = the Present Value of one hundred percent (100%) of the Accrued
Benefit amount used to calculate any Acceleration Payment received by the
Participant; and
G = the amount of any Insurance Proceeds payable in respect of such
Participant.
In no event shall the Death Benefit be less than zero.
8.2 If a Participant dies after commencing receipt of
either or both of his monthly Benefit under the Plan and/or his benefit under
the FIRF Plan, the amount of the Death Benefit shall equal the Present Value of
the remaining unpaid monthly Benefit payments reduced, but not below zero, by
the amount of any Insurance Proceeds payable in respect of such Participant.
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9. ASSIGNMENTS AND TRANSFERS. No right or benefit of a
Participant, a surviving contingent annuitant or a surviving spouse under the
Plan may be assigned, alienated, encumbered, or otherwise hypothecated or
transferred in any manner. No such right or benefit hereunder shall be subject
to legal process or attachment for the payment of any claims of a creditor of or
through a Participant or a beneficiary of a deceased Participant.
10. EMPLOYEE RIGHTS UNDER THE PLAN. Neither the Plan nor any
action taken thereunder shall be construed as giving any Participant any right
to be retained in the employment of the Employer, nor shall it be construed as
limiting in any way the right of the Employer to discharge any Participant or to
treat him without regard to the effect any such treatment would or might have
upon him as a Participant in the Plan.
11. UNFUNDED PLAN. The Plan shall be unfunded and no Participant
in the Plan shall have any right to any specific assets of the Employer by
reason of the Plan, and the rights of each Participant hereunder shall be solely
those of an unsecured creditor of the Employer. Any liability of the Employer to
any Participant under the Plan shall be based solely upon the contractual
obligations that may be created as a result of the Plan and such Participant's
Participation Agreement. No such obligation of the Employer shall be deemed to
be secured by any pledge of, encumbrance on, or other interest in, any property
or asset of the Employer or any affiliate of the Employer. Nothing contained in
the Plan shall be construed as creating in respect of any Participant (or
beneficiary thereof or any other person) any equity or other interest of any
kind in any assets of the Employer or any affiliate of the Employer, or creating
a trust of any kind or a fiduciary relationship of any kind between the
Employer, any affiliate of the Employer, and/or any such Participant, any
beneficiary or any other person. Except as specifically provided herein,
participation in the Plan shall not in any way affect any rights which a
Participant may have under any other employee benefit plan of the Employer or
under any individual contractual agreement between such Participant and the
Employer. Notwithstanding the foregoing, timely payment of all Benefits and
Death Benefits payable under the Plan (including without limitation Acceleration
Payments and Early Tax Obligations) shall be fully guaranteed by BostonFed
Bancorp, Inc.
12. SOURCE OF PAYMENT. Subject to Section 11 hereof, the Employer,
in its sole discretion, may establish (a) a grantor or other trust of which the
Employer is treated as the owner under the Code and the assets of which are
subject to the claims of the Employer's general creditors in the event of its
insolvency, (b) an insurance arrangement, or (c) any other arrangement or
arrangements designed to provide for the payment of benefits hereunder. Any such
arrangement shall be subject to such other terms and conditions as the Employer
may deem necessary or advisable to ensure that benefits are not includible, by
reason of the establishment of any such arrangement or the funding of any such
trust, in the income of the beneficiaries of such trust or other arrangement
prior to actual distribution or other payment and that the existence of such
trust or other arrangement does not cause the Plan to be considered to be funded
for purposes of Title I of ERISA.
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13. AMENDMENT OR TERMINATION. The BFSB Board may amend, suspend,
or terminate the Plan or any portion thereof at any time. Notwithstanding the
foregoing, (a) without the consent of the Participant, no such amendment,
suspension, or termination shall cause such Participant's (or his designated
beneficiary's, as the case may be) benefits hereunder to be less than the lesser
of (i) such Participant's Accrued Benefit as of the effective date of such
amendment, suspension, or termination, or (ii) such Participant's Benefit
payable under Section 5 (or Section 8) at the times specified in Section 6 (or
Section 8) determined as if such amendment, suspension or termination had not
been effected, and (b) any other Employer Board may terminate its Employer's
continued participation in the Plan which shall constitute a termination of the
Plan as to that Employer.
14. GOVERNING LAW; CONSTRUCTION. The Plan shall be governed by and
construed, interpreted and administered in accordance with the laws of the
Commonwealth of Massachusetts, except to the extent such laws are preempted by
ERISA. The titles and headings of sections of the Plan are for convenience of
reference only and shall have no substantive meaning in and of themselves.
15. WITHHOLDING. All payments under the Plan shall be made in cash
and shall be reduced by such amounts as are required to be withheld with respect
thereto under applicable federal, state and local tax laws and regulations in
effect as of the date of any such payments. In the event any federal, state or
local taxes are imposed with respect to any benefits under the Plan before such
benefits become payable to the Participant or his beneficiary (an "Early Tax
Obligation"), then the Employer shall pay such Early Tax Obligation and, in the
Employer Board's sole discretion, either (a) withhold an equivalent amount of
funds from any current or future compensation payable by the Employer to the
Participant, or (b) require the Participant to promptly provide an equivalent
amount of funds to the Employer. To the extent the Employer does not collect an
equivalent amount from the Participant in accordance with the preceding
sentence, then the Employer may reduce any Benefit payment hereunder by the then
Present Value of such Early Tax Obligations paid by the Employer.
16. OTHER BENEFITS PLANS OR PROGRAMS. Payments and benefits
received under the Plan shall not be deemed a part of any Participant's
compensation for purposes of determining any benefits under any other welfare,
pension or incentive benefit plans or programs, if any, maintained by the
Employer or any of its affiliates or predecessors from time to time.
17. EFFECTIVE DATE. The Plan shall be effective as of September
21, 1999.
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IN WITNESS WHEREOF, the Plan is executed by Boston Federal Savings Bank
on this ____ day of March, 2000.
BOSTON FEDERAL SAVINGS BANK
By:
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