EXHIBIT 10.2


FORM OF
PERFORMANCE AWARD AGREEMENT UNDER THE 1997 EQUITY INCENTIVE PLAN


STATE
STREET CORPORATION


Performance Award
Agreement


(Name)


Re: Performance Award


Dear
          :


This
letter shall serve as an agreement (the “Agreement”) between you and State
Street Corporation (the “Company”) setting forth the terms and conditions
relating to the Performance Award granted to you under the Company’s 1997
Equity Incentive Plan, as amended (the “Plan”), which shall be payable if
certain performance and other conditions are satisfied as described below.


1. Grant of Performance Award.


You
have been granted an award (the “Award) consisting of a total of          
units (“Units”). To be entitled to any payment under the Award, you must
execute this Agreement and return a fully executed copy to the Company, and all
terms and conditions of this Award must have been satisfied. The Award will be
payable, if at all, based in part on the achievement by the Company of certain
performance measures (described below and in Exhibit I) over the two-year
period commencing January 1, 2006 and ending on December 31, 2007 (the “Performance
Period”). The date on which the Performance Period ends (December 31, 2007) is
referred to herein as the “Maturity Date.”


2. Performance Targets:
Committee Certification.


Whether your Award
will be paid and if so in what amounts will depend in part (i) as to
seventy (70%) percent of the Award (the “EPS Portion”), on the Company’s
achievement of specified earnings per share targets as described in (a) below
and in Exhibit I, and (ii) as to the remaining thirty (30%) percent of the
Award (the “ROE Portion”), on the Company’s achievement of specified return on
shareholders’ equity targets as described in (b) below and in Exhibit I.


(a) Earnings
Per Share (EPS). Subject to the other terms and conditions of the Award,
the Company’s full diluted aggregated earnings per share from continuing



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operations (“EPS”)
for the Performance Period will determine how much, if any, of the EPS Portion
of the Award will be payable. Exhibit I sets forth the EPS threshold that must
be achieved if any of the EPS Portion is to be payable and the higher EPS
target that must be achieved if the entire EPS Portion is to be payable, with
interpolation for EPS performance between those limits.


(b) Return
on Equity (ROE). Subject to the other terms and conditions of the Award,
the Company’s average return on shareholders’ equity from continuing operations
(“ROE”) will determine how much, if any, of the ROE Portion of the Award will
be payable. Exhibit I sets forth the ROE threshold that must be achieved if any
of the ROE Portion is to be payable and the higher ROE amounts that must be
achieved if higher percentages, or the entirety, of the ROE Portion is to be
payable, with interpolation for ROE performance between those limits.


The
specific EPS and ROE performance targets for the Performance Period were
established by the Committee on March 1, 2006 and are set forth on Exhibit I,
attached hereto and made a part hereof. Subject to the other terms and
conditions of the Award, payment under this Award will only be made if the
Committee certifies, following the close of the Performance Period, that the
pre-established threshold performance targets have been exceeded on the
Maturity Date and then only to the extent of the level of performance so
certified as having been achieved.


3. Form
of Payment.


Any
portion of the Award earned by reason of a Committee certification as described
above will be payable in shares of the Company’s common stock (“Common Stock”)
on or before the March 31 next following the end of the Performance Period. The
number of shares to be paid will be determined by multiplying the number of
Units set forth in paragraph 1, above, by the Total Funding Percentage. For
this purpose, “Total Funding Percentage” means the sum of the weighted funding
percentages achieved for each of the ROE and EPS performance targets,
respectively, for the Performance Period as certified by the Committee.


4. Non — Transferability, Etc.


This Award shall
not be transferable otherwise than by will or the laws of descent and
distribution and it may be exercised during your lifetime only by you. Any
attempt to assign or transfer the Award, either voluntarily or involuntarily,
contrary to the provisions hereof, shall be null and void and without effect
and shall render the Award itself null and void.



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5. Termination of Employment


No amount shall be paid in respect of the Award in the
event that you cease to be employed by the Company prior to the end of the
Performance Period, except as the Committee may otherwise determine in its sole
discretion. Any payment under the Award pursuant to an exercise by the
Committee of its discretion under the preceding sentence will take into account
the time between the date on which your employment so terminated and the end of
the Performance Period. In addition, payment to you of any unearned Award after
termination of your employment otherwise than by reason of your death shall be
subject to the conditions that until the date on which the Award is paid you
shall (i) not engage whether directly or indirectly, in any manner or capacity
as advisor, principal, agent, partner, officer, director, employee, member of
any association, or otherwise, in any business or activity which is at the time
competitive with any business or activity conducted by the Company or any of
its direct or indirect subsidiaries, and (ii) be available at reasonable
times for consultations at the request of the Company’s management with respect
to phases of the business with which you were actively connected during your
employment. In the event that either of the above conditions is not fulfilled,
you shall receive no payment under this Award. Any determination by the
Committee that you are, or have engaged in a competitive business or activity
as aforesaid or not have been available for consultations as aforesaid shall be
conclusive and binding on all persons. Notwithstanding the foregoing, this
paragraph 5(b) shall be inapplicable following a Change of Control


6. Acceleration of Performance
Award.


Notwithstanding
anything in this Agreement to the contrary, in the event of a Change of Control
occurring prior to the Maturity Date, you shall be entitled at the time of such
Change of Control to receive a cash payment equal to the adjusted fair market
value of a share of the Common Stock multiplied by the number of Units set
forth in paragraph 1, above. For purposes of the preceding sentence, “adjusted
fair market value” shall mean the higher of the (i) the highest average of the
reported daily high and low prices per share of the Common Stock during the
60-day period prior to the first date of actual knowledge by the Board of
Directors of circumstances that resulted in a Change of Control, and (ii) if
the Change of Control is the result of a transaction or series of transactions
described in Section 7.4(b)(1) or (3) of the Plan, the highest price per share
of the Common Stock paid in such transaction series of transactions (which in
the case of a transaction described in Section 7.4(b)(1) of the Plan shall be
the highest price per share of the Common Stock as reflected in a Schedule 13D
filed by the person having made the acquisition


7. Changes in Capitalization
or Corporate Structure.


The
Award is subject to adjustment pursuant to Section 8.6 of the Plan in the
circumstances therein described.



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8. Amendments to Performance Units.


Subject to the
specific limitations set forth in the Plan, the Committee may at any time
suspend or terminate any rights or obligations relating to the Award prior to
the Maturity Date without your consent.


9. Compliance with Section
162(m).


The
Committee shall exercise its discretion with respect to this Award in all cases
so as to preserve the deductibility of payments under the Award against
disallowance by reason of Section 162(m) of the Internal Revenue Code of 1986,
as amended (the “Code).


10. Provisions of the Plan.


The
provisions of the Plan are incorporated herein by reference, and all terms not
otherwise defined herein shall have the meaning given to them in the Plan. In
the event of any conflict between the provisions of this Agreement and the
provisions of the Plan, the provisions of the Plan shall control. You
acknowledge that you have received a copy of the Plan and a copy of the
Prospectus for the Plan.


If the Award and
the foregoing terms and conditions are acceptable to you, please sign the
enclosed counterpart of this letter and return the same to the undersigned.


	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  STATE STREET CORPORATION

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
  Boon S. Ooi

  
	
   

  	
   

  	
  Senior Vice President

  



 


The undersigned hereby
accepts the Award on the terms and subject to the conditions set forth above.


 


	
  

  	
   

  
	
   

  	
  (Name)

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
				



 



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