Exhibit 10.1

MELLON FINANCIAL CORPORATION

LONG-TERM PROFIT INCENTIVE PLAN (2004)

PERFORMANCE SHARE AWARD AGREEMENT

THIS AGREEMENT, made as of this          day of                     , by and
between Mellon Financial Corporation (the “Corporation”), having its principal
place of business in the Commonwealth of Pennsylvania,

and

[NAME], a key employee (the “Grantee”) of the Corporation

WITNESSETH THAT:

WHEREAS, Grantee is now employed by the Corporation (“Corporation”, when used
herein with reference to employment of Grantee, shall include any Affiliate of
the Corporation as defined in the Plan) as a key employee; and

WHEREAS, the Corporation has adopted the Long-Term Profit Incentive Plan
(2004) (the “Plan”) under which the Corporation may grant to key employees
Restricted Stock and Other Stock-Based Awards, as each are defined in the Plan,
providing the Grantee with shares, or rights to receive shares, of common stock,
par value $.50 per share, of the Corporation (the “Stock”) subject to
restrictions set forth in the Plan and in this Agreement; and

WHEREAS, the Corporation desires to grant to Grantee (i) an award of [NUMBER]
shares of Restricted Stock and (ii) an Other Stock-Based Award representing the
right to receive [NUMBER] shares of Stock;

NOW THEREFORE, in consideration of the covenants and agreements herein contained
and intending to be legally bound, the parties hereto hereby agree with each
other as follows:

SECTION 1: Restricted Stock Award

1.1 Subject to the terms and conditions set forth herein and to the terms of the
Plan, and in order to provide an additional incentive for Grantee, as a key
employee, to work for the long-range success of the Corporation, the Corporation
hereby awards to Grantee the number of shares of Restricted Stock stated above,
subject to adjustment as provided in Section 10.7 of the Plan. Notwithstanding
Section 8.4 of the Plan, dividends paid with respect to the Restricted Stock
shall not be paid to, or earned by, the Grantee unless and to the extent the
underlying shares of Restricted Stock are earned as provided in Section 4.1
hereof.

SECTION 2: Other Stock-Based Award

2.1 Subject to the terms and conditions set forth herein and to the terms of the
Plan, and in order to provide an additional incentive for Grantee, as a key
employee, to work for the long-range success of the Corporation, the Corporation
hereby awards to Grantee an Other Stock-Based Award representing the right to
receive the number of shares of Stock stated above,

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subject to adjustment as provided in Section 10.7 of the Plan. No dividends
shall be paid to the Grantee with respect to shares represented by the Other
Stock-Based Award. The Committee, as hereinafter defined, shall have the
authority, in its discretion, to determine that any obligation of the
Corporation with respect to the Other Stock-Based Award may be paid in cash, in
shares of Stock or part in cash and part in shares of Stock.

SECTION 3: Restricted Stock; Restrictions on Transfer

3.1 No shares of Restricted Stock awarded hereunder or any interest therein may
be sold, transferred, assigned, pledged or otherwise disposed of (any such
action being hereinafter referred to as a “Disposition” of shares) by the
Grantee until such time as this restriction lapses with respect to such shares
pursuant to Section 4 hereof.

3.2 Grantee agrees that a restrictive legend in substantially the following form
may be placed on the certificate or book-entry account representing the shares
of Restricted Stock awarded hereunder:

“The sale, transfer, assignment, pledge or other disposition of the shares
represented by this certificate is subject to the restrictions set forth in the
Mellon Financial Corporation Long-Term Profit Incentive Plan (2004) and in the
Performance Share Award Agreement executed thereunder dated as of
                    , copies of each of which are available for inspection at
the principal office of Mellon Financial Corporation. No such transaction shall
be recognized as valid or effective unless there shall have been compliance with
the terms and conditions of such Agreement.”

3.3 Grantee hereby authorizes the Corporation or its agents to retain custody of
the certificates or book-entry account representing the Restricted Stock awarded
hereunder until such time as the restrictions on Disposition lapse. To the
extent the shares of Restricted Stock are earned as provided in Section 4.1 and
upon the certification set forth in Section 4.2 hereof, the Corporation will
either (i) cause to be delivered to Grantee (which delivery may be by Mellon
interoffice mail or by the U.S. mail at the last address for Grantee then
indicated in the Corporation’s records) certificates for such shares registered
in the name of Grantee or (ii) credit such shares to (or retain such shares in)
a book-entry account in Grantee’s name, in either case with the restrictive
legend described in Section 3.2 hereof removed. As soon as practicable after the
signing of this Agreement, Grantee shall deliver it to the Corporation’s
Executive Compensation area (AIM No. 151-0722).

3.4 Grantee understands that the transfer agent for the Restricted Stock will be
instructed to effect transfers of the shares of Restricted Stock awarded
hereunder only upon satisfaction of the conditions set forth herein and in the
Plan.

SECTION 4: Lapse of Restrictions, Forfeiture of Shares and Earning of Other
Stock-Based Awards

4.1. Performance Condition. For the performance period beginning
                     and ending on                      or, if earlier, the date
of a Change in Control Event, as defined in the Plan, (the “Performance
Period”), the total number of shares of Restricted Stock on which the
restrictions shall lapse and the total number of shares of

 

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Stock (or cash equivalent thereof) that will be issued and/or paid for the Other
Stock-Based Award will be based on the Corporation’s Total Return to
Shareholders relative to the peer group’s (the “Peer Group’s”) Total Return to
Shareholders. The list of companies included within the Peer Group is attached
hereto as Exhibit A.

(a) Total Return to Shareholders. For purposes of this Agreement, Total Return
to Shareholders for the Performance Period for the Corporation and for each
company in the Peer Group will be the Total Return to Shareholders for those
companies, as such amounts are calculated and reported by Bloomberg, Comparative
Total Shareholder Return, on the daily convention basis.

(i) Each company in the Peer Group will then be ranked in descending order by
the Total Return to Shareholders so calculated and the Corporation’s Total
Return to Shareholders shall be ranked in relation thereto, using the whole
company ranking method.

(ii) If a company within the Peer Group ceases to be publicly traded during the
Performance Period, such company shall be excluded from the Peer Group for the
entire Performance Period.

(b) Application of Performance Condition.

(i) The total number of shares of Restricted Stock awarded will be multiplied by
the Performance Factor identified on the Restricted Stock Payout Schedule that
corresponds to the Corporation’s relative ranking in relation to the Peer Group
to determine the number of shares of Restricted Stock earned. The Restricted
Stock Payout Schedule is attached hereto as Exhibit B.

(ii) The total number of shares subject to the Other Stock-Based Award will be
multiplied by the Performance Factor identified on the Other Stock-Based Award
Payout Schedule that corresponds to the Corporation’s relative ranking in
relation to the Peer Group to determine the number of shares of Stock earned
pursuant to such Award. The Other Stock-Based Award Payout Schedule is attached
hereto as Exhibit C.

(iii) The lapse of restrictions on the Restricted Stock and the issuance of
shares (or cash) pursuant to the Other Stock-Based Award are expressly
contingent upon the extent to which the performance criteria is satisfied.
Notwithstanding the foregoing, in the case of a Change in Control Event, the
Grantee shall be entitled to a pro-rata portion of each of the Restricted Stock
and Other Stock-Based Award (rounded down to the nearest whole share), based
upon (x) the number of whole completed months during the Performance Period in
relationship to          months, and (y) the Performance Factor applicable to
the Corporation’s actual Total Return to Shareholders percentile rank for such
Period as set forth on Exhibits B and C, respectively, or, if greater, the
Performance Factor applicable to a percentile ranking of             %.
Notwithstanding anything set forth in this Agreement, no payment shall exceed
any applicable limits set forth in the Plan.

 

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(c) Employment Condition. Notwithstanding Sections 4.1(a) and (b) hereof, and
except as provided in Section 4.1(d), a derestriction of the Restricted Stock
and/or the issuance of shares or payment of cash pursuant to an Other
Stock-Based Award pursuant to this Section 4.1 shall only occur if Grantee
continues to be actively employed by the Corporation or any of its Affiliates on
the last day of the Performance Period.

(d) Exceptions to Employment Condition. Notwithstanding Section 4.1(c), if the
Grantee’s termination of employment occurs prior to the end of the Performance
Period by reason of (i) Grantee’s death, (ii) Grantee’s disability (covered by a
long-term disability plan of the Corporation or an Affiliate then in effect),
(iii) Grantee’s termination on or after age          with              years of
credited employment with the Corporation or an Affiliate, (iv) a displacement,
as determined in accordance with the Corporation’s Employee Displacement Program
or any successor or similar practice of the Corporation or an Affiliate, or
(v) sale of a business unit or subsidiary of the Corporation by which Grantee is
employed, then Grantee shall be entitled to a pro-rata derestriction of the
Restricted Stock and a pro-rata issuance of shares (or payment of cash) pursuant
to the Other Stock-Based Award (rounded down to the nearest whole share), equal
to the number of shares (or amount of cash) the Grantee would have received if
he or she had remained employed through the last day of the Performance Period,
multiplied by a fraction equal to the number of whole months of employment
completed during the Performance Period divided by              months,
contingent upon the extent to which the performance criteria is satisfied for
such Performance Period. In the event the Grantee is entitled to a pro-rata
derestriction or issuance as set forth in this Section 4.1(d), the timing of
such derestriction or issuance shall be in accordance with Sections 3.3 and
4.1(e), respectively.

(e) Issuance of Shares for Other Stock-Based Award. To the extent some or all of
the shares of Stock represented by the Other Stock-Based Award are earned as
provided in Section 4.1 and upon the certification set forth in Section 4.2
hereof, the Corporation will either (i) cause to be delivered to Grantee (which
delivery may be by Mellon interoffice mail or by the U.S. mail at the last
address for Grantee then indicated in the Corporation’s records) certificates
for such shares registered in the name of Grantee (or cash) or (ii) credit such
shares (or cash) to a book-entry account in Grantee’s name; provided further
that the issuance of shares and/or payment of cash earned pursuant to the Other
Stock-Based Award shall be made no later than 2 1/2 months following the last
day of the Performance Period. If payment is made in cash, the amount will be
based upon the Fair Market Value of the shares otherwise issuable, as defined
under the Plan, on the last day of the Performance Period, payable without
interest.

4.2 Committee Certification. As promptly as practicable after the end of the
Performance Period, the Human Resources Committee of the Board of Directors (the
“Committee”) shall determine, in accordance with the terms of the Plan and this
Agreement, and certify whether and the extent to which the performance criteria
has been satisfied and the number, if any, of the shares of Restricted Stock
and/or shares (or cash) represented by the Other Stock-Based Award are earned
under Section 4.1.

4.3 Upon the effective date of a termination of Grantee’s employment with the
Corporation for any reason not specified in Section 4.1(d) above, all shares of
Restricted Stock

 

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then subject to restrictions on Disposition, including any dividends paid
thereon, and stock (and/or cash) subject to the Other Stock-Based Award shall
immediately be forfeited and returned to the Corporation without consideration
or further action being required of the Corporation. For purposes of this
Agreement, the effective date of Grantee’s termination shall be the date upon
which Grantee ceases to perform services as an employee of the Corporation or
any of its subsidiaries, without regard to accrued vacation, severance or other
benefits or the characterization thereof on the payroll records of the
Corporation or any of its subsidiaries.

SECTION 5: Miscellaneous

5.1 Notwithstanding any other provision of this Agreement, Grantee hereby agrees
to take any action, and consents to the taking of any action by the Corporation,
with respect to the Stock awarded hereunder necessary to achieve compliance with
applicable laws or regulations in effect from time to time. Any determination by
the Committee with respect to the need for any action in order to achieve such
compliance with laws or regulations shall be final, binding and conclusive. The
Corporation shall in no event be obligated to register any securities pursuant
to the Securities Act of 1933 (as the same shall be in effect from time to time)
or to take any other affirmative action in order to cause the award of Stock
under the Plan, the lapsing of restrictions thereon or the delivery of
certificates therefor to comply with any law or regulation in effect from time
to time.

5.2 Grantee shall be advised by the Corporation or an Affiliate as to the amount
of any federal, state, local or foreign income or employment taxes required to
be withheld by the Corporation or such Affiliate on the compensation income
resulting from the award of, or lapse of restrictions on, or issuance of the
Stock or payment of cash. Grantee shall pay any taxes required to be withheld
directly to the Corporation or any Affiliate in cash upon request, except that
the Grantee may satisfy such obligation in whole or in part by requesting the
Corporation in writing to withhold from the shares of Stock otherwise
deliverable to the Grantee shares of Common Stock having a Fair Market Value, as
defined in the Plan, on the date of determination of the tax, equal to the
amount of the withholding tax obligation to be so satisfied. Grantee understands
that no shares of Stock shall be delivered to Grantee, notwithstanding the
earning thereof, unless and until Grantee shall have satisfied any obligation
for withholding taxes with respect thereto as provided herein.

5.3 Grantee hereby indemnifies the Corporation and holds it harmless from and
against any and all damages or liabilities incurred by the Corporation
(including liabilities for attorneys’ fees and disbursements) arising out of any
breach by the Grantee of this Agreement, including, without limitation, any
attempted Disposition in violation of Section 3.1 hereof.

5.4 Nothing herein shall be construed as giving Grantee any right to be retained
in the employ of the Corporation or affect any right that the Corporation may
have to terminate the employment of Grantee.

5.5 This Agreement is subject in all respects to the terms of the Plan, as
amended and interpreted from time to time by the Committee; provided, however,
that no alteration, amendment, revocation or termination of the Plan shall,
without the written consent of Grantee, adversely affect the rights of Grantee
with respect to the Awards made hereunder. Should there be any inconsistency
between the provisions of this Agreement and the terms and conditions of

 

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the Plan, the provisions in the Plan shall govern. Grantee may obtain a copy of
the Plan by writing or calling the Executive Compensation Division of the
Corporation’s Human Resources Department in Pittsburgh, Pennsylvania.

5.6 This Agreement shall be construed and enforced in accordance with the laws
of the Commonwealth of Pennsylvania, other than any choice of law provisions
calling for the application of laws of another jurisdiction.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

 

MELLON FINANCIAL CORPORATION By:  

 

GRANTEE

 

 

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EXHIBIT A

PEER GROUP COMPANIES

 

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EXHIBIT B

RESTRICTED STOCK PAYOUT SCHEDULE

 

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EXHIBIT C

OTHER STOCK-BASED AWARD PAYOUT SCHEDULE

 

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