EXHIBIT 10.9
FEDERAL HOME LOAN BANK OF
SEATTLE
THRIFT PLAN BENEFIT EQUALIZATION
PLAN
Originally Effective as
of
July 1, 1994
Amended Effective as of
January 1, 2005,
Except as Otherwise
Stated Herein
THRIFT PLAN BENEFIT EQUALIZATION
PLAN
INTRODUCTION
The adoption of this Thrift Plan
Benefit Equalization Plan has been authorized by the Board of
Directors of the Federal Home Loan Bank of Seattle (the
“Employer”) solely for the purpose of providing
benefits to certain employees selected by the Employer, which
benefits are equivalent to the matching contributions and 401(k)
contributions which would have been available under the qualified
defined contribution Thrift Plan, as adopted by the Employer (the
“Thrift Plan”), but for the limitations placed on
benefits for such employees by Sections 401(a) (17),
401(k)(3)(A)(ii), 401(m), 402(g) and 415 of the Internal Revenue
Code of 1986, as amended from time to time, or any successor
thereto (“Code”).
This Plan is intended to provide
benefits in excess of the limitations on benefits imposed by the
Code for eligible employees whose benefits payable under this Plan
shall be paid solely from the general assets of the Employer and/or
a grantor trust established by the Employer to pay such benefits.
No benefits under this Plan shall be payable from the assets of the
Thrift Plan.
Article 1.
Definitions
When used in the Plan, the following
terms shall have the following meanings:
1.01 “Account” means the recordkeeping
account maintained hereunder to record the contributions deemed to
be made by the Member and the Employer, as well as the increase or
loss in value attributable to the earnings thereon, all as
described hereafter.
1.02 “Actuary” means the independent
consulting actuary retained by the Employer to assist the Committee
in its administration of the Plan.
1.03 “Beneficiary” means the beneficiary
or beneficiaries designated in accordance with Article 5 of the
Plan to receive the benefit, if any, payable upon the death of a
Member of the Plan.
1.04 “Board of Directors” means the Board
of Directors of the Employer.
1.05 “Code” means the Internal Revenue
Code of 1986, as amended from time to time, or any successor
thereto.
1.06 “Code Limitations” means the cap on
compensation taken into account by a plan under Code
Section 401(a)(17), the limitations on 401(k) contributions
necessary to meet the average deferral percentage
(“ADP”) test under Code Section 401(k)(3)(A)(ii),
the limitations on employee and matching contributions necessary to
meet the average contribution percentage (“ACP”) test
under Code Section 401(m), the dollar limitations on elective
deferrals under Code Section 402(g) and the overall
limitations on contributions and benefits imposed on qualified
plans by Code Section 415, as such provisions may be amended
from time to time, and any similar successor provisions of federal
tax law.
1.07 “Committee” means the Thrift Plan
Benefit Equalization Plan Committee appointed by the Board of
Directors to administer the Plan.
1.08 “Compensation” means, for purposes
of this Plan, an Employee’s total salary or wages from the
Employer, before any salary reduction contributions to the
Employer’s 401(k) Plan, to the Employer’s Internal
Revenue Code Section 125 flexible benefits plan, to the
Employer’s Internal Revenue Code Section 132(f)
qualified transportation fringe benefits plan, and to this Plan,
but excluding any Employer contributions to this Plan, Employer
contributions to any similar retirement plan, and payments by the
Employer (other than Section 125 contributions) on account of
medical, disability and life insurance.
Compensation also includes bonuses,
if the Member makes a separate irrevocable deferral election to
defer a percentage of a bonus no later than June 30 of the
applicable calendar year performance period, even though that bonus
will not be payable until the next calendar year, and by
March 15, 2005 for the 2004 calendar year performance
period.
1.09 “Effective Date” of this amended and
restated Plan is January 1, 2005, except as otherwise
specifically provided herein. The Plan’s original Effective
Date was July 1, 1994.
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This Plan has been amended and restated as of
January 1, 2005 to comply with Code Section 409A and
applicable regulations.
1.10 “Employer” means the Federal Home
Loan Bank of Seattle.
1.11 “Member” means a Highly-Compensated
Employee of the Employer, as that term is defined in the Thrift
Plan, who has been selected to be a Member by the Board of
Directors. Notwithstanding the foregoing, effective January 1,
2007, the Board designates as an eligible Member any employee whose
Compensation will exceed the limit on eligible compensation for a
Plan Year under Code Section 401(a)(17), regardless of whether
that employee is treated as a Highly-Compensated Employee under
Code Section 414(q); provided, however, that any previous
designation of an eligible Member by the Board shall remain in
effect to the extent that such designation has not been previously
revoked by the Board.
1.12 “Plan” means the Federal Home Loan
Bank of Seattle Thrift Plan Benefit Equalization Plan, as set forth
herein and as amended from time to time, plus any administrative
rules and regulations adopted by the Committee.
1.13 “Plan Year” means the calendar
year.
1.14 “Thrift Plan” means the qualified
defined contribution Thrift Plan and trust under Sections 401(a)
and 501(a) of the Code, as adopted by the Employer.
Article 2.
Membership
2.01 Each employee of the Employer who is selected as
a Member in this Plan and who is included in the membership of the
Thrift Plan shall be enrolled as a Member of this Plan for the
purposes of Article 3 on the latest of (i) the date on which
he is eligible to make an elective contribution under the Thrift
Plan, (ii) the date he is selected as a Member by the Board of
Directors, or (iii) July 1, 1994.
2.02 If a Member is no longer entitled to participate
in the Thrift Plan and to make any contributions to the Thrift
Plan, his membership in the Plan shall terminate on such
date.
2.03 A benefit shall be payable under the Plan to or
on account of a member only upon the Member’s retirement,
death or other termination of employment with the
Employer.
2.04 No employee shall have the automatic right to be
selected as a Member. Once selected as a Member, the employee shall
remain a Member each year unless removed by action of the Board of
Directors. If an employee ceases to be a Member but continues to be
employed by the Employer, he shall not be eligible to defer any
further portion of his compensation under Sections 3.01, 3.02 or
3.03 until he shall again become a Member.
Article 3. Amount and Payment of
Benefits
3.01 Annually on or before December 31, a Member
may elect to defer an amount of his compensation for the next
calendar year. The amount deferred may not exceed an amount that is
determined annually by the Committee in its sole discretion and
that is communicated to
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the Member during December of the year preceding
the calendar year in which the compensation is deferred. The
election shall be in writing, on a form provided by the Committee,
and shall be irrevocable as to any compensation payable in the next
calendar year. Any change of election with respect to future
years’ Compensation must be filed with the Committee prior to
the end of the calendar year preceding the calendar year in which
the change is to take effect.
Notwithstanding the previous
paragraph, a new Member may elect to defer the receipt of a portion
of his Compensation payable for services performed after the date
of such election during the remainder of the calendar year of
eligibility in an amount not to exceed the amount determined by the
Committee as described in the preceding paragraph. That election
must be made in writing within 30 days after the Member is notified
of his eligibility to participate in this Plan, and shall be
irrevocable as to any Compensation payable for services performed
after the date of such election during the remainder of that
calendar year.
The amount deferred by the Member
pursuant to this Section 3.01 shall be withheld from the
Member’s Compensation each month in such percentages as the
Member designates on an election form completed by December 31
for each month in the next calendar year. The Member may designate
different percentages for each such month, if he or she wishes.
Notwithstanding the foregoing, a Member may elect to make a
separate deferral election with respect to bonuses, if that
irrevocable election to defer a percentage of a bonus is made no
later than June 30 of the applicable calendar year performance
period, even though that bonus will not be payable until the next
calendar year, and by March 15, 2005 for the 2004 calendar
year performance period.
3.02 A Member annually may make an additional
irrevocable election within the time period described in
Section 3.01 (on or before December 31 for the next
calendar year) to contribute an additional amount of his
Compensation to the Employer’s Thrift Plan for the next
calendar year. The amount subject to such election shall be equal
to the lesser of (a) the maximum amount of additional elective
contributions that could be made to the Employer’s Thrift
Plan for the next calendar year on his or her behalf under the
average deferral percentage test and subject to the limitation on
elective deferrals under Internal Revenue Code Section 402(g),
or (b) his or her Compensation deferred under this Plan for
the next calendar year. If a Member makes that election, the amount
subject to the election shall be available in cash to the Member as
soon as is practicable after the end of the applicable calendar
year, but in no event later than March 15 of the year
following that calendar year; provided, however, that such amount
shall be contributed as an elective contribution to the
Employer’s Thrift Plan, if the Member has irrevocably elected
to do so, no later than December 31 of the calendar year in
which the Compensation to which the salary deferral relates is
earned.
3.03 For each elective contribution addition credited
to a Member under Section 3.01, such Member shall also be
credited with a matching contribution addition under this Plan
equal to the matching contribution, if any, that would be credited
under the Thrift Plan with respect to such amount if contributed to
the Thrift Plan, determined as if the provisions of the Thrift Plan
were administered without regard to the Code Limitations and
determined after taking into account the employee’s actual
regular account and 401(k) account elective contributions to and
actual matching contributions under the Thrift Plan. Such matching
contribution addition for any calendar year shall be determined
after subtracting any Member elective contribution additions that
are contributed to the Employer’s Thrift Plan under
Section 3.02. Notwithstanding the
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foregoing, Members will not be credited with a
matching contribution addition under this Plan for calendar year
2005, so that any elective contribution addition credited to a
Member under Section 3.01 for calendar year 2005 will not
receive any matching contribution addition under this Plan for that
year.
3.04 The Committee shall maintain Plan recordkeeping
accounts on the books and records of the Employer for each Member.
The pre-2005 elective contribution additions and matching
contribution additions of a Member under Sections 3.01 and 3.03
shall be credited to the Member’s pre-2005 grandfathered Plan
recordkeeping account as soon as reasonably practicable after the
date that the compensation reduced under Section 3.01 would
otherwise have been paid to such Member. The post-2004 elective
contribution additions and matching contribution additions of a
Member under Sections 3.01 and 3.03 shall be credited t
