Item 5.02 Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
(e) On September 18, 2007, State Street
Corporation (State Street) approved amendments to certain of its U.S.
qualified and non-qualified retirement plans, including the State Street
Supplemental Executive Retirement Plan (the SERP) and the State Street 401(k)
Restoration and Voluntary Deferral Plan (the Restoration Plan). Each of our Chairman and Chief Executive
Officer, Ronald E. Logue, our Executive Vice President and Chief Financial
Officer, Edward J. Resch, and our Vice Chairmen, William W. Hunt, Joseph L.
Hooley and Joseph C. Antonellis (the Named Executives) participates in or is
eligible to participate in the SERP and the Restoration Plan. These amendments are consistent with
amendments to State Streets qualified defined benefit plan (the Retirement
Plan) and its 401(k) plan (the 401(k) Plan), which are available to U.S.
employees.
SERP
State Street maintains a supplemental retirement plan
that is designed to provide to designated management or highly compensated
employees the benefits that would be payable under the Retirement Plan but for
the limitations imposed on the Retirement Plan by the Internal Revenue
Code. Amounts payable under the SERP are
offset by amounts that are payable under the Retirement Plan.
The amendments to the SERP include, effective December
31, 2007, closing the SERP to new participants and ceasing all future benefit
accruals, except for a three-year transition subsidy to certain participants
who meet a specified combination of age and completed years of eligible service
on that date. The subsidy will be an
annual credit of 3% of the participants base salary up to a maximum of
$500,000 (less the applicable Internal Revenue Code cap). Other than Mr. Resch and Mr. Hunt, each of
the Named Executives is eligible for this subsidy. Beginning on January 1, 2008, benefits will
be distributed as a lump sum payment on the first day of the month following
the six-month anniversary of a participants termination of employment.
Restoration Plan
The Restoration Plan is a non-qualified plan
maintained for designated management or highly compensated employees. Under this plan, and prior to the amendments
approved on September 18, 2007, eligible employees could elect, prior to the
beginning of a year, to defer (a) base salary equal to the excess of a
percentage, from 6% to 15%, of base salary for the year over the maximum amount
that may be deferred for the year under the 401(k) Plan, and (b) some or
all of their annual cash incentive bonuses.
A participant who deferred base salary for a year received a matching
credit from State Street of up to the excess of 3% of base salary over the
maximum matching State Street contribution permitted for the participant under
the 401(k) Plan. Under the 401(k) Plan,
participants were eligible to receive a maximum State Street matching
2
contribution of up to 3%
of their base salary that did not exceed the maximum Internal Revenue Code
cap. An account is maintained for each
participant in the Restoration Plan reflecting deferrals, matching credits and
increases or decreases based on the performance of notional investments
selected by the employee or on a default investment if the employee does not
make a selection. A participant may
change notional investments once per calendar month.
The amendments to
the Restoration Plan, effective January 1, 2008, include the following: (1) permitting elections to defer up to 25%
of base salary and to defer 5-92% of annual cash incentive bonuses; (2)
increasing the State Street matching credit to 100% of the first 6% of pay
deferred and providing for a performance-based credit, in State Streets
discretion, of up to a maximum of 5% of pay; (3) defining pay for purposes of
the matching credit as base salary plus annual cash incentive bonus not
exceeding 50% of prior year base salary, and for purposes of the
performance-based credit as base salary alone, in each case up to a maximum of
$500,000 (less the applicable Internal Revenue Code cap); and (4) providing for
the distribution of State Street matching and performance-based credits in a
lump sum on the first day of the month following the six-month anniversary of
the employees termination of employment and the distribution of base salary
and bonus deferrals and all other deferrals made prior to January 1, 2008 in
accordance with the employees election as to time and form of payment, either
as a lump sum distribution or in installments over two to ten years.