**Exhibit 10.1**

 

**ENERNOC, INC.**

**AMENDED AND RESTATED**

**2007 EMPLOYEE, DIRECTOR AND CONSULTANT STOCK PLAN**

 

1.*    **DEFINITIONS.*

 

Unlessotherwise specified or unless the context otherwise requires, the followingterms, as used in this EnerNOC, Inc. 2007 Employee, Director andConsultant Stock Plan, have the following meanings:

 

*Administrator*  means the Board of Directors, unless it hasdelegated power to act on its behalf to the Committee, in which case theAdministrator means the Committee.

 

*Affiliate*  means a corporation which, for purposes ofSection 424 of the Code, is a parent or subsidiary of the Company, director indirect.

 

*Agreement*  means an agreement between the Company and aParticipant delivered pursuant to the Plan, in such form as the Administratorshall approve.

 

*Board of Directors*  means the Board of Directors of the Company.

 

*Code*  means the United States Internal Revenue Codeof 1986, as amended from time to time, and the rules and regulationspromulgated thereunder.

 

*Committee*  means the committee of the Board of Directorsto which the Board of Directors has delegated power to act under or pursuant tothe provisions of the Plan, the composition of which shall at all times satisfythe provisions of Section 162(m) of the Code.

 

*Common Stock*  means shares of the Company’s common stock,$.001 par value per share.

 

*Company*  means EnerNOC, Inc., a Delawarecorporation.

 

*Disability*  or *Disabled*means permanent and total disability as defined in Section 22(e)(3) ofthe Code.

 

*Employee*  means any employee of the Company or of anAffiliate (including, without limitation, an employee who is also serving as anofficer or director of the Company or of an Affiliate), designated by theAdministrator to be eligible to be granted one or more Stock Rights under thePlan.

 

*Fair Market Value*  of a Share of Common Stock means:

 

(1)   If the Common Stock islisted on a national securities exchange or traded in the over-the-countermarket and sales prices are regularly reported for the Common Stock, theclosing or last price of the Common Stock on the composite tape or othercomparable reporting system for the trading day on the applicable date and ifsuch applicable date is not a trading day, the last market trading day prior tosuch date;

 

(2)   If the Common Stock is nottraded on a national securities exchange but is traded on the over-the-countermarket, if sales prices are not regularly reported for the Common Stock for thetrading day referred to in clause (1), and if bid and asked prices for theCommon Stock are regularly reported, the mean between the bid and the askedprice for the Common Stock at the close of trading in the over-the-countermarket for the trading day on which Common Stock was traded on the applicabledate and if such applicable date is not a trading day, the last market tradingday prior to such date; and

 

(3)   If the Common Stock isneither listed on a national securities exchange nor traded in theover-the-counter market, such value as the Administrator, in good faith, shalldetermine.

 

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*ISO*  meansan option meant to qualify as an incentive stock option under Section 422of the Code.

 

*Non-Qualified Option*  means an option which is not intended toqualify as an ISO.

 

*Option*  meansan ISO or Non-Qualified Option granted under the Plan.

 

*Participant*  means an Employee, director or consultant ofthe Company or an Affiliate to whom one or more Stock Rights are granted underthe Plan. As used herein, “Participant” shall include “Participant’s Survivors”where the context requires.

 

*Performance-Based Award*  means a Stock Grant or Stock—Based Award asset forth in Paragraph 9 hereof.

 

*Performance Goals*  means performance goals based on one or moreof the following criteria: (i) pre-tax income or after-tax income;(ii) income or earnings including operating income, earnings before orafter taxes, interest, depreciation, amortization, and/or extraordinary orspecial items; (iii) net income excluding amortization of intangibleassets, depreciation and impairment of goodwill and intangible assets and/orexcluding charges attributable to the adoption of new accountingpronouncements; (iv) earnings or book value per share (basic or diluted);(v) return on assets (gross or net), return on investment, return oncapital, or return on equity; (vi) return on revenues; (vii) cashflow, free cash flow, cash flow return on investment (discounted or otherwise),net cash provided by operations, or cash flow in excess of cost of capital;(viii) economic value created; (ix) operating margin or profitmargin; (x) stock price or total stockholder return; (xi) income orearnings from continuing operations; (xii) cost targets, reductions andsavings, expense management, productivity and efficiencies; and(xiii) strategic business criteria, consisting of one or more objectivesbased on meeting specified market penetration or market share, geographicbusiness expansion, customer satisfaction, employee satisfaction, humanresources management, supervision of litigation, information technology, andgoals relating to divestitures, joint ventures and similar transactions. Whereapplicable, the Performance Goals may be expressed in terms of attaining aspecified level of the particular criterion or the attainment of a percentageincrease or decrease in the particular criterion, and may be applied to one ormore of the Company or an Affiliate of the Company, or a division or strategicbusiness unit of the Company, all as determined by the Committee. ThePerformance Goals may include a threshold level of performance below which noPerformance-Based Award will be issued or no vesting will occur, levels ofperformance at which Performance-Based Awards will be issued or specifiedvesting will occur, and a maximum level of performance above which noadditional issuances will be made or at which full vesting will occur. Each ofthe foregoing Performance Goals shall be evaluated in accordance with generallyaccepted accounting principles, where applicable, and shall be subject tocertification by the Committee. The Committee shall have the authority to make equitableadjustments to the Performance Goals in recognition of unusual or non-recurringevents affecting the Company or any Affiliate or the financial statements ofthe Company or any Affiliate, in response to changes in applicable laws orregulations, or to account for items of gain, loss or expense determined to beextraordinary or unusual in nature or infrequent in occurrence or related tothe disposal of a segment of a business or related to a change in accountingprinciples provided that any such change shall at all times satisfy theprovisions of Section 162(m) of the Code.

 

*Plan*  means this Amended and RestatedEnerNOC, Inc. 2007 Employee, Director and Consultant Stock Plan.

 

*Shares*  means shares of the Common Stock as to whichStock Rights have been or may be granted under the Plan or any shares ofcapital stock into which the Shares are changed or for

 

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whichthey are exchanged within the provisions of Paragraph 3 of the Plan. TheShares issued under the Plan may be authorized and unissued shares or sharesheld by the Company in its treasury, or both.

 

*Stock-Based Award*  means a grant by the Company under the Planof an equity award or an equity based award which is not an Option or a StockGrant, which the Committee may structure to qualify in whole or in part as“performance-based compensation” under Section 162(m) of the Code.

 

*Stock Grant*  means a grant by the Company of Shares underthe Plan, which the Committee may structure to qualify in whole or in part as“performance-based compensation” under Section 162(m) of the Code.

 

*Stock Right*  means a right to Shares or the value ofShares of the Company granted pursuant to the Plan—an ISO, a Non-QualifiedOption, a Stock Grant or a Stock-Based Award.

 

*Survivor*  means a deceased Participant’s legalrepresentatives and/or any person or persons who acquired the Participant’srights to a Stock Right by will or by the laws of descent and distribution.

 

*2.**    **PURPOSESOF THE PLAN*.

 

ThePlan is intended to encourage ownership of Shares by Employees and directors ofand certain consultants to the Company and its Affiliates in order to attractand retain such people, to induce them to work for the benefit of the Companyor of an Affiliate and to provide additional incentive for them to promote thesuccess of the Company or of an Affiliate. The Plan provides for the grantingof ISOs, Non-Qualified Options, Stock Grants and Stock-Based Awards.

 

3.*    **SHARESSUBJECT TO THE PLAN.*

 

(a)   The number ofShares which may be issued from time to time pursuant to this Plan shall be thesum of: (i) 2,600,000 shares of Common Stock and (ii) any shares ofCommon Stock that are represented by awards granted under the Company’s 2003Stock Option and Incentive Plan that are forfeited, expire or are cancelledwithout delivery of shares of Common Stock or which result in the forfeiture ofshares of Common Stock back to the Company on or after the date on which thisPlan became effective, or the equivalent of such number of Shares after the Administrator,in its sole discretion, has interpreted the effect of any stock split, stockdividend, combination, recapitalization or similar transaction in accordancewith Paragraph 25 of this Plan; provided, however, that no more than1,000,000 Shares shall be added to the Plan pursuant to subsection (ii).

 

(b)   NotwithstandingSubparagraph (a) above, on the first day of each fiscal year of theCompany during the period beginning in fiscal year 2008, and ending on thesecond day of fiscal year 2017, the number of Shares that may be issued fromtime to time pursuant to the Plan, shall be increased by an amount equal to thelesser of (i) 520,000 or the equivalent of such number of Shares after theAdministrator, in its sole discretion, has interpreted the effect of any stocksplit, stock dividend, combination, recapitalization or similar transaction inaccordance with Paragraph 25 of the Plan; and (ii) an amountdetermined by the Board.

 

(c)   If an Optionceases to be “outstanding”, in whole or in part (other than by exercise), or ifthe Company shall reacquire (at not more than its original issuance price) anyShares issued pursuant to a Stock Grant or Stock-Based Award, or if any StockRight expires or is forfeited, cancelled, or otherwise terminated or results inany Shares not being issued, the unissued Shares which were subject to suchStock Right shall again be available for issuance from time to time pursuant tothis Plan. Notwithstanding the foregoing, if a Stock Right is exercised, inwhole or in part, by tender of Shares or if the Company’s tax withholdingobligation is satisfied by withholding Shares, the number of Shares

 

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deemed to have been issuedunder the Plan for purposes of the limitation set forth in Paragraph 3(a) aboveshall be the number of Shares that were subject to the Stock Right or portionthereof, and not the net number of Shares actually issued.

 

4.*    **ADMINISTRATIONOF THE PLAN.*

 

TheAdministrator of the Plan will be the Board of Directors, except to the extentthe Board of Directors delegates its authority to the Committee, in which casethe Committee shall be the Administrator. Notwithstanding the foregoing, theBoard of Directors may not take any action that would cause any outstanding StockRight that would otherwise qualify as performance-based compensation to fail toso qualify under Section 162(m).

 

Subjectto the provisions of the Plan, the Administrator is authorized to:

 

a.     Interpret the provisions ofthe Plan and all Stock Rights and to make all rules and determinationswhich it deems necessary or advisable for the administration of the Plan;

 

b.     Determine which Employees,directors and consultants shall be granted Stock Rights;

 

c.     Determine the number ofShares for which a Stock Right or Stock Rights shall be granted, provided,however, that in no event shall Stock Rights with respect to more than 130,000Shares be granted to any Participant in any fiscal year;

 

d.     Specify the terms andconditions upon which a Stock Right or Stock Rights may be granted;

 

e.     Determine Performance Goalsno later than such time as required to ensure that a Performance-Based Awardwhich is intended to comply with the requirements of Section 162(m) ofthe Code so complies;

 

f.      Make changes to any outstandingStock Right, including, without limitation, to reduce or increase the exerciseprice or purchase price, accelerate the vesting schedule or extend theexpiration date, provided that no such change shall impair the rights of aParticipant under any grant previously made without such Participant’s consent;

 

g.     Make any adjustments in thePerformance Goals included in any Performance-Based Awards provided that suchadjustments comply with the requirements of Section 162(m) of theCode;

 

h.     Buy out for a payment incash or Shares, a Stock Right previously granted and/or cancel any such StockRight and grant in substitution therefor other Stock Rights, covering the sameor a different number of Shares and having an exercise price or purchase priceper share which may be lower or higher than the exercise price or purchaseprice of the cancelled Stock Right, based on such terms and conditions as theAdministrator shall establish and the Participant shall accept; and

 

i.      Adopt any sub-plansapplicable to residents of any specified jurisdiction as it deems necessary orappropriate in order to comply with or take advantage of any tax or other lawsapplicable to the Company or to Plan Participants or to otherwise facilitatethe administration of the Plan, which sub-plans may include additionalrestrictions or conditions applicable to Stock Rights or Shares issuablepursuant to a Stock Right;

 

provided, however, that allsuch interpretations, rules, determinations, terms and conditions shall be madeand prescribed in the context of preserving the tax status underSection 422 of the Code of those Options which are designated as ISOs andin accordance with Section 162(m) of the Code for all other StockRights to which the Committee has determined Section 162(m) is applicable.Subject to the foregoing, the interpretation and construction by theAdministrator of any provisions of the Plan or of any Stock Right granted underit shall be final, unless otherwise determined by the Board of Directors, ifthe Administrator is the Committee. In addition, if the Administrator is theCommittee, the Board of 

 

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Directors may take anyaction under the Plan that would otherwise be the responsibility of theCommittee.

 

Tothe extent permitted under applicable law, the Board of Directors or theCommittee may allocate all or any portion of its responsibilities and powers toany one or more of its members and may delegate all or any portion of itsresponsibilities and powers to any other person selected by it. The Board ofDirectors or the Committee may revoke any such allocation or delegation at anytime.

 

5.*    **ELIGIBILITYFOR PARTICIPATION.*

 

TheAdministrator will, in its sole discretion, name the Participants in the Plan,provided, however, that each Participant must be an Employee, director orconsultant of the Company or of an Affiliate at the time a Stock Right isgranted. Notwithstanding the foregoing, the Administrator may authorize thegrant of a Stock Right to a person not then an Employee, director or consultantof the Company or of an Affiliate; provided, however, that the actual grant ofsuch Stock Right shall be conditioned upon such person becoming eligible tobecome a Participant at or prior to the time of the execution of the Agreementevidencing such Stock Right. ISOs may be granted only to Employees.Non-Qualified Options, Stock Grants and Stock-Based Awards may be granted toany Employee, director or consultant of the Company or an Affiliate. Thegranting of any Stock Right to any individual shall neither entitle thatindividual to, nor disqualify him or her from, participation in any other grantof Stock Rights.

 

6.*    **TERMSAND CONDITIONS OF OPTIONS.*

 

EachOption shall be set forth in writing in an Option Agreement, duly executed bythe Company and, to the extent required by law or requested by the Company, bythe Participant. The Administrator may provide that Options be granted subjectto such terms and conditions, consistent with the terms and conditionsspecifically required under this Plan, as the Administrator may deemappropriate including, without limitation, subsequent approval by theshareholders of the Company of this Plan or any amendments thereto. The OptionAgreements shall be subject to at least the following terms and conditions:

 

a.*    **Non-QualifiedOptions:*  Each Optionintended to be a Non-Qualified Option shall be subject to the terms andconditions which the Administrator determines to be appropriate and in the bestinterest of the Company, subject to the following minimum standards for anysuch Non-Qualified Option:

 

i.*     **OptionPrice:*  Each Option Agreement shallstate the option price (per share) of the Shares covered by each Option, whichoption price shall be determined by the Administrator but shall not be less thanthe Fair Market Value per share of Common Stock.

 

ii.*    **Numberof Shares:*  Each OptionAgreement shall state the number of Shares to which it pertains.

 

iii.*   **OptionPeriods:*  Each OptionAgreement shall state the date or dates on which it first is exercisable andthe date after which it may no longer be exercised, and may provide that theOption rights accrue or become exercisable in installments over a period ofmonths or years, or upon the occurrence of certain conditions or the attainmentof stated goals or events.

 

iv.*   **OptionConditions:*  Exercise ofany Option may be conditioned upon the Participant’s execution of a Sharepurchase agreement in form satisfactory to the Administrator providing forcertain protections for the Company and its other shareholders, includingrequirements that:

 

A.    The Participant’s or theParticipant’s Survivors’ right to sell or transfer the Shares may berestricted; and

 

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B.    The Participant or theParticipant’s Survivors may be required to execute letters of investment intentand must also acknowledge that the Shares will bear legends noting anyapplicable restrictions.

 

b.*    **ISOs:*  Each Option intended to be an ISO shall beissued only to an Employee and be subject to the following terms andconditions, with such additional restrictions or changes as the Administratordetermines are appropriate but not in conflict with Section 422 of theCode and relevant regulations and rulings of the Internal Revenue Service:

 

i.*     **Minimumstandards:*  The ISOshall meet the minimum standards required of Non-Qualified Options, asdescribed in Paragraph 6(a) above.

 

ii.*    **OptionPrice:*  Immediately before the ISO isgranted, if the Participant owns, directly or by reason of the applicableattribution rules in Section 424(d) of the Code:

 

A.    10% *or less* of the total combined voting powerof all classes of stock of the Company or an Affiliate, the Option price pershare of the Shares covered by each ISO shall not be less than 100% of the FairMarket Value per share of the Shares on the date of the grant of the Option; or

 

B.    More than 10% of the totalcombined voting power of all classes of stock of the Company or an Affiliate,the Option price per share of the Shares covered by each ISO shall not be lessthan 110% of the Fair Market Value on the date of grant.

 

iii.*   *Term*of Option:*  For Participants who own:

 

A.    10% *or less* of the total combined voting powerof all classes of stock of the Company or an Affiliate, each ISO shallterminate not more than ten years from the date of the grant or at such earliertime as the Option Agreement may provide; or

 

B.    More than 10% of the totalcombined voting power of all classes of stock of the Company or an Affiliate,each ISO shall terminate not more than five years from the date of the grant orat such earlier time as the Option Agreement may provide.

 

iv.*   **Limitationon Yearly Exercise:*  The OptionAgreements shall restrict the amount of ISOs which may become exercisable inany calendar year (under this or any other ISO plan of the Company or anAffiliate) so that the aggregate Fair Market Value (determined at the time eachISO is granted) of the stock with respect to which ISOs are exercisable for thefirst time by the Participant in any calendar year does not exceed $100,000.

 

7.*    **TERMSAND CONDITIONS OF STOCK GRANTS.*

 

Eachoffer of a Stock Grant to a Participant shall state the date prior to which theStock Grant must be accepted by the Participant, and the principal terms ofeach Stock Grant shall be set forth in an Agreement, duly executed by theCompany and, to the extent required by law or requested by the Company, by theParticipant. The Agreement shall be in a form approved by the Administrator andshall contain terms and conditions which the Administrator determines to beappropriate and in the best interest of the Company, subject to the followingminimum standards:

 

(a)   Each Agreement shall statethe purchase price (per share), if any, of the Shares covered by each StockGrant, which purchase price shall be determined by the Administrator but shallnot be less than the minimum consideration required by the Delaware GeneralCorporation Law on the date of the grant of the Stock Grant;

 

(b)   Each Agreement shall statethe number of Shares to which the Stock Grant pertains; and

 

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(c)   Each Agreement shall includethe terms of any right of the Company to restrict or reacquire the Sharessubject to the Stock Grant, including the time or attainment of PerformanceGoals upon which such rights shall accrue and the purchase price therefor, ifany.

 

8.*    **TERMSAND CONDITIONS OF OTHER STOCK-BASED AWARDS.*

 

TheAdministrator shall have the right to grant other Stock-Based Awards based uponthe Common Stock having such terms and conditions as the Administrator maydetermine, including, without limitation, the grant of Shares based uponcertain conditions, the grant of securities convertible into Shares and thegrant of stock appreciation rights, phantom stock awards or stock units. Theprincipal terms of each Stock-Based Award shall be set forth in an Agreement,duly executed by the Company and, to the extent required by law or requested bythe Company, by the Participant. The Agreement shall be in a form approved bythe Administrator and shall contain terms and conditions which theAdministrator determines to be appropriate and in the best interest of theCompany.

 

9.*    **PERFORMANCE-BASEDAWARDS.*

 

Notwithstandinganything to the contrary herein, during any period when Section 162(m) ofthe Code is applicable to the Company and the Plan, Stock Rights granted underParagraph 7 and Paragraph 8 may be granted by the Committee in amanner which is deductible by the Company under Section 162(m) of theCode (“Performance-Based Awards”). A Participant’s Performance-Based Awardshall be determined based on the attainment of written Performance Goals, whichmust be objective and approved by the Committee for a performance period ofbetween one and five years established by the Committee (I) while theoutcome for that performance period is substantially uncertain and (II) nomore than 90 days after the commencement of the performance period towhich the Performance Goal relates or, if less, the number of days which isequal to 25% of the relevant performance period. The Committee shall determinewhether, with respect to a performance period, the applicable Performance Goalshave been met with respect to a given Participant and, if they have, to socertify and ascertain the amount of the applicable Performance-Based Award. NoPerformance-Based Awards will be issued for such performance period until suchcertification is made by the Committee. The number of shares issued in respectof a Performance-Based Award to a given Participant may be less than the amountdetermined by the applicable Performance Goal formula, at the discretion of theCommittee. The number of shares issued in respect of a Performance-Based Awarddetermined by the Committee for a performance period shall be paid to theParticipant at such time as determined by the Committee in its sole discretionafter the end of such performance period.

 

10.*  **EXERCISEOF OPTIONS AND ISSUE OF SHARES.*

 

AnOption (or any part or installment thereof) shall be exercised by givingwritten notice to the Company or its designee, together with provision forpayment of the full purchase price in accordance with this Paragraph for theShares as to which the Option is being exercised, and upon compliance with anyother condition(s) set forth in the Option Agreement. Such notice shall besigned by the person exercising the Option, shall state the number of Shareswith respect to which the Option is being exercised and shall contain anyrepresentation required by the Plan or the Option Agreement. Payment of the purchaseprice for the Shares as to which such Option is being exercised shall be made(a) in United States dollars in cash or by check, or (b) at thediscretion of the Administrator, through delivery of shares of Common Stockhaving a Fair Market Value equal as of the date of the exercise to the cashexercise price of the Option and held for at least six months, or (c) atthe discretion of the Administrator, by having the Company retain from theshares otherwise issuable upon exercise of the Option, a number of shareshaving a Fair Market Value equal as of the date of exercise to the exerciseprice of the Option, or (d) at the discretion of the Administrator, inaccordance with a cashless exercise program established with a securitiesbrokerage firm, and approved by the Administrator, or (e) at thediscretion of the Administrator, by any combination of (a), (b), (c) and(d) above or (f) at the discretion of the Administrator, payment ofsuch other lawful consideration as the Administrator may

 

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determine. Notwithstandingthe foregoing, the Administrator shall accept only such payment on exercise ofan ISO as is permitted by Section 422 of the Code.

 

TheCompany shall then reasonably promptly deliver the Shares as to which suchOption was exercised to the Participant (or to the Participant’s Survivors, asthe case may be). In determining what constitutes “reasonably promptly,” it isexpressly understood that the issuance and delivery of the Shares may bedelayed by the Company in order to comply with any law or regulation(including, without limitation, state securities or “blue sky” laws) whichrequires the Company to take any action with respect to the Shares prior totheir issuance. The Shares shall, upon delivery, be fully paid, non-assessableShares.

 

TheAdministrator shall have the right to accelerate the date of exercise of anyinstallment of any Option; provided that the Administrator shall not acceleratethe exercise date of any installment of any Option granted to an Employee as anISO (and not previously converted into a Non-Qualified Option pursuant toParagraph 28) without the prior approval of the Employee if suchacceleration would violate the annual vesting limitation contained inSection 422(d) of the Code, as described in Paragraph 6(b)(iv).

 

TheAdministrator may, in its discretion, amend any term or condition of anoutstanding Option provided (i) such term or condition as amended ispermitted by the Plan, (ii) any such amendment shall be made only with theconsent of the Participant to whom the Option was granted, or in the event ofthe death of the Participant, the Participant’s Survivors, if the amendment isadverse to the Participant, and (iii) any such amendment of any Optionshall be made only after the Administrator determines whether such amendmentwould constitute a “modification” of any Option which is an ISO (as that termis defined in Section 424(h) of the Code) or would cause any adversetax consequences for the holder of such Option including, but not limited to,pursuant to Section 409A of the Code.

 

11.*  **ACCEPTANCEOF STOCK GRANTS AND STOCK-BASED AWARDS AND ISSUE OF SHARES.*

 

AStock Grant or Stock-Based Award (or any part or installment thereof) shall beaccepted by executing the applicable Agreement and delivering it to the Companyor its designee, together with provision for payment of the full purchaseprice, if any, in accordance with this Paragraph for the Shares as to whichsuch Stock Grant or Stock-Based Award is being accepted, and upon compliancewith any other conditions set forth in the applicable Agreement. Payment of thepurchase price for the Shares as to which such Stock Grant or Stock-Based Awardis being accepted shall be made (a) in United States dollars in cash or bycheck, or (b) at the discretion of the Administrator, through delivery ofshares of Common Stock held for at least six months and having a Fair MarketValue equal as of the date of acceptance of the Stock Grant or StockBased-Award to the purchase price of the Stock Grant or Stock-Based Award, or(c) at the discretion of the Administrator, by delivery of the grantee’spersonal recourse note bearing interest payable not less than annually at noless than 100% of the applicable Federal rate, as defined in Section 1274(d) ofthe Code, or (d) at the discretion of the Administrator, by anycombination of (a), (b) and (c) above; or (e) at the discretionof the Administrator, payment of such other lawful consideration as theAdministrator may determine.

 

TheCompany shall then, if required by the applicable Agreement, reasonablypromptly deliver the Shares as to which such Stock Grant or Stock-Based Awardwas accepted to the Participant (or to the Participant’s Survivors, as the casemay be), subject to any escrow provision set forth in the applicable Agreement.In determining what constitutes “reasonably promptly,” it is expresslyunderstood that the issuance and delivery of the Shares may be delayed by theCompany in order to comply with any law or regulation (including, withoutlimitation, state securities or “blue sky” laws) which requires the Company totake any action with respect to the Shares prior to their issuance.

 

TheAdministrator may, in its discretion, amend any term or condition of anoutstanding Stock Grant, Stock-Based Award or applicable Agreement provided(i) such term or condition as amended is 

 

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permitted by the Plan, and(ii) any such amendment shall be made only with the consent of theParticipant to whom the Stock Grant or Stock-Based Award was made, if theamendment is adverse to the Participant.

 

12.*  **RIGHTSAS A SHAREHOLDER.*

 

NoParticipant to whom a Stock Right has been granted shall have rights as ashareholder with respect to any Shares covered by such Stock Right, exceptafter due exercise of the Option or acceptance of the Stock Grant or as setforth in any Agreement, and tender of the full purchase price, if any, for theShares being purchased pursuant to such exercise or acceptance and registrationof the Shares in the Company’s share register in the name of the Participant.

 

13.*  **ASSIGNABILITYAND TRANSFERABILITY OF STOCK RIGHTS.*

 

Byits terms, a Stock Right granted to a Participant shall not be transferable bythe Participant other than (i) by will or by the laws of descent anddistribution, or (ii) as approved by the Administrator in its discretionand set forth in the applicable Agreement. Notwithstanding the foregoing, anISO transferred except in compliance with clause (i) above shall nolonger qualify as an ISO. The designation of a beneficiary of a Stock Right bya Participant, with the prior approval of the Administrator and in such form asthe Administrator shall prescribe, shall not be deemed a transfer prohibited bythis Paragraph. Except as provided above, a Stock Right shall only beexercisable or may only be accepted, during the Participant’s lifetime, by suchParticipant (or by his or her legal representative) and shall not be assigned,pledged or hypothecated in any way (whether by operation of law or otherwise)and shall not be subject to execution, attachment or similar process. Anyattempted transfer, assignment, pledge, hypothecation or other disposition ofany Stock Right or of any rights granted thereunder contrary to the provisionsof this Plan, or the levy of any attachment or similar process upon a StockRight, shall be null and void.

 

14.*  **EFFECTON OPTIONS OF TERMINATION OF SERVICE OTHER THAN “FOR CAUSE” OR DEATH ORDISABILITY.*

 

Exceptas otherwise provided in a Participant’s Option Agreement, in the event of atermination of service (whether as an employee, director or consultant) withthe Company or an Affiliate before the Participant has exercised an Option, thefollowing rules apply:

 

a.     A Participant who ceases tobe an employee, director or consultant of the Company or of an Affiliate (forany reason other than termination “for cause”, Disability, or death for whichevents there are special rules in Paragraphs 15, 16, and 17,respectively), may exercise any Option granted to him or her to the extent thatthe Option is exercisable on the date of such termination of service, but onlywithin such term as the Administrator has designated in a Participant’s OptionAgreement.

 

b.     Except as provided inSubparagraph (c) below, or Paragraph 16 or 17, in no event mayan Option intended to be an ISO, be exercised later than three months after theParticipant’s termination of employment.

 

c.     The provisions of thisParagraph, and not the provisions of Paragraph 16 or 17, shall apply to aParticipant who subsequently becomes Disabled or dies after the termination ofemployment, director status or consultancy; provided, however, in the case of aParticipant’s Disability or death within three months after the termination ofemployment, director status or consultancy, the Participant or theParticipant’s Survivors may exercise the Option within one year after the dateof the Participant’s termination of service, but in no event after the date ofexpiration of the term of the Option.

 

d.     Notwithstanding anythingherein to the contrary, if subsequent to a Participant’s termination ofemployment, termination of director status or termination of consultancy, butprior to the

 

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exerciseof an Option, the Board of Directors determines that, either prior orsubsequent to the Participant’s termination, the Participant engaged in conductwhich would constitute “cause”, then such Participant shall forthwith cease tohave any right to exercise any Option.

 

e.     A Participant to whom anOption has been granted under the Plan who is absent from the Company or anAffiliate because of temporary disability (any disability other than aDisability as defined in Paragraph 1 hereof), or who is on leave ofabsence for any purpose, shall not, during the period of any such absence, bedeemed, by virtue of such absence alone, to have terminated such Participant’semployment, director status or consultancy with the Company or with anAffiliate, except as the Administrator may otherwise expressly provide.

 

f.      Except as required by law oras set forth in a Participant’s Option Agreement, Options granted under the Planshall not be affected by any change of a Participant’s status within or amongthe Company and any Affiliates, so long as the Participant continues to be anemployee, director or consultant of the Company or any Affiliate.

 

15.*  **EFFECTON OPTIONS OF TERMINATION OF SERVICE “FOR CAUSE”.*

 

Exceptas otherwise provided in a Participant’s Option Agreement, the following rules applyif the Participant’s service (whether as an employee, director or consultant)with the Company or an Affiliate is terminated “for cause” prior to the timethat all his or her outstanding Options have been exercised:

 

a.     All outstanding andunexercised Options as of the time the Participant is notified his or herservice is terminated “for cause” will immediately be forfeited.

 

b.     For purposes of this Plan,“cause” shall include (and is not limited to) dishonesty with respect to theCompany or any Affiliate, insubordination, substantial malfeasance ornon-feasance of duty, unauthorized disclosure of confidential information,breach by the Participant of any provision of any employment, consulting,advisory, nondisclosure, non-competition or similar agreement between theParticipant and the Company, and conduct substantially prejudicial to thebusiness of the Company or any Affiliate. The determination of theAdministrator as to the existence of “cause” will be conclusive on theParticipant and the Company.

 

c.     “Cause” is not limited toevents which have occurred prior to a Participant’s termination of service, noris it necessary that the Administrator’s finding of “cause” occur prior totermination. If the Administrator determines, subsequent to a Participant’stermination of service but prior to the exercise of an Option, that eitherprior or subsequent to the Participant’s termination the Participant engaged inconduct which would constitute “cause”, then the right to exercise any Optionis forfeited.

 

d.     Any provision in anagreement between the Participant and the Company or an Affiliate, whichcontains a conflicting definition of “cause” for termination and which is ineffect at the time of such termination, shall supersede the definition in thisPlan with respect to that Participant.

 

16.*  **EFFECTON OPTIONS OF TERMINATION OF SERVICE FOR DISABILITY.*

 

Exceptas otherwise provided in a Participant’s Option Agreement:

 

a.     A Participant who ceases tobe an employee, director or consultant of the Company or of an Affiliate byreason of Disability may exercise any Option granted to such Participant:

 

(i)    To the extent that theOption has become exercisable but has not been exercised on the date ofDisability; and

 

(ii)   In the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of Disability of any additional vesting rights that would have

 

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accruedon the next vesting date had the Participant not become Disabled. The prorationshall be based upon the number of days accrued in the current vesting periodprior to the date of Disability.

 

b.     A Disabled Participant mayexercise such rights only within the period ending one year after the date ofthe Participant’s Disability, notwithstanding that the Participant might havebeen able to exercise the Option as to some or all of the Shares on a laterdate if the Participant had not become Disabled and had continued to be anemployee, director or consultant or, if earlier, within the originallyprescribed term of the Option.

 

c.     The Administrator shall makethe determination both of whether Disability has occurred and the date of itsoccurrence (unless a procedure for such determination is set forth in anotheragreement between the Company and such Participant, in which case suchprocedure shall be used for such determination). If requested, the Participantshall be examined by a physician selected or approved by the Administrator, thecost of which examination shall be paid for by the Company.

 

17.*  **EFFECTON OPTIONS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.*

 

Exceptas otherwise provided in a Participant’s Option Agreement:

 

a.     In the event of the death ofa Participant while the Participant is an employee, director or consultant ofthe Company or of an Affiliate, such Option may be exercised by theParticipant’s Survivors:

 

(i)    To the extent that theOption has become exercisable but has not been exercised on the date of death;and

 

(ii)   In the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of death of any additional vesting rights that would haveaccrued on the next vesting date had the Participant not died. The prorationshall be based upon the number of days accrued in the current vesting periodprior to the Participant’s date of death.

 

b.     If the Participant’sSurvivors wish to exercise the Option, they must take all necessary steps toexercise the Option within one year after the date of death of suchParticipant, notwithstanding that the decedent might have been able to exercisethe Option as to some or all of the Shares on a later date if he or she had notdied and had continued to be an employee, director or consultant or, ifearlier, within the originally prescribed term of the Option.

 

18.*  **EFFECTOF TERMINATION OF SERVICE ON UNACCEPTED STOCK GRANTS.*

 

Inthe event of a termination of service (whether as an employee, director orconsultant) with the Company or an Affiliate for any reason before theParticipant has accepted a Stock Grant, such offer shall terminate.

 

Forpurposes of this Paragraph 18 and Paragraph 19 below, a Participantto whom a Stock Grant has been offered and accepted under the Plan who isabsent from work with the Company or with an Affiliate because of temporarydisability (any disability other than a Disability as defined inParagraph 1 hereof), or who is on leave of absence for any purpose, shallnot, during the period of any such absence, be deemed, by virtue of suchabsence alone, to have terminated such Participant’s employment, directorstatus or consultancy with the Company or with an Affiliate, except as theAdministrator may otherwise expressly provide.

 

Inaddition, for purposes of this Paragraph 18 and Paragraph 19 below,any change of employment or other service within or among the Company and anyAffiliates shall not be treated as a termination

 

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of employment, directorstatus or consultancy so long as the Participant continues to be an employee,director or consultant of the Company or any Affiliate.

 

19.*  **EFFECTON STOCK GRANTS OF TERMINATION OF SERVICE OTHER THAN “FOR CAUSE” OR DEATH ORDISABILITY.*

 

Exceptas otherwise provided in a Participant’s Stock Grant Agreement, in the event ofa termination of service (whether as an employee, director or consultant),other than termination “for cause,” Disability, or death for which events thereare special rules in Paragraphs 20, 21, and 22, respectively, beforeall forfeiture provisions or Company rights of repurchase shall have lapsed,then the Company shall have the right to cancel or repurchase that number ofShares subject to a Stock Grant as to which the Company’s forfeiture orrepurchase rights have not lapsed.

 

20.*  **EFFECTON STOCK GRANTS OF TERMINATION OF SERVICE “FOR CAUSE”.*

 

Exceptas otherwise provided in a Participant’s Stock Grant Agreement, the followingrules apply if the Participant’s service (whether as an employee, directoror consultant) with the Company or an Affiliate is terminated “for cause”:

 

a.     All Shares subject to anyStock Grant that remain subject to forfeiture provisions or as to which theCompany shall have a repurchase right shall be immediately forfeited to theCompany as of the time the Participant is notified his or her service isterminated for Cause.

 

b.     For purposes of this Plan,“cause” shall include (and is not limited to) dishonesty with respect to theemployer, insubordination, substantial malfeasance or non-feasance of duty,unauthorized disclosure of confidential information, breach by the Participantof any provision of any employment, consulting, advisory, nondisclosure,non-competition or similar agreement between the Participant and the Company,and conduct substantially prejudicial to the business of the Company or anyAffiliate. The determination of the Administrator as to the existence of“cause” will be conclusive on the Participant and the Company.

 

c.     “Cause” is not limited toevents which have occurred prior to a Participant’s termination of service, noris it necessary that the Administrator’s finding of “cause” occur prior totermination. If the Administrator determines, subsequent to a Participant’stermination of service, that either prior or subsequent to the Participant’stermination the Participant engaged in conduct which would constitute “cause,”then the Company’s right to repurchase all of such Participant’s Shares shallapply.

 

d.     Any provision in anagreement between the Participant and the Company or an Affiliate, whichcontains a conflicting definition of “cause” for termination and which is ineffect at the time of such termination, shall supersede the definition in thisPlan with respect to that Participant.

 

21.*  **EFFECTON STOCK GRANTS OF TERMINATION OF SERVICE FOR DISABILITY.*

 

Exceptas otherwise provided in a Participant’s Stock Grant Agreement, the followingrules apply if a Participant ceases to be an employee, director orconsultant of the Company or of an Affiliate by reason of Disability: to theextent the forfeiture provisions or the Company’s rights of repurchase have notlapsed on the date of Disability, they shall be exercisable; provided, however,that in the event such forfeiture provisions or rights of repurchase lapseperiodically, such provisions or rights shall lapse to the extent of a pro rataportion of the Shares subject to such Stock Grant through the date ofDisability as would have lapsed had the Participant not become Disabled. Theproration shall be based upon the number of days accrued prior to the date ofDisability.

 

TheAdministrator shall make the determination both of whether Disability hasoccurred and the date of its occurrence (unless a procedure for suchdetermination is set forth in another agreement

 

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between the Company and suchParticipant, in which case such procedure shall be used for suchdetermination). If requested, the Participant shall be examined by a physicianselected or approved by the Administrator, the cost of which examination shallbe paid for by the Company.

 

22.*  **EFFECTON STOCK GRANTS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.*

 

Exceptas otherwise provided in a Participant’s Stock Grant Agreement, the followingrules apply in the event of the death of a Participant while theParticipant is an employee, director or consultant of the Company or of anAffiliate: to the extent the forfeiture provisions or the Company’s rights ofrepurchase have not lapsed on the date of death, they shall be exercisable;provided, however, that in the event such forfeiture provisions or rights ofrepurchase lapse periodically, such provisions or rights shall lapse to theextent of a pro rata portion of the Shares subject to such Stock Grant throughthe date of death as would have lapsed had the Participant not died. Theproration shall be based upon the number of days accrued prior to theParticipant’s death.

 

23.*  **PURCHASEFOR INVESTMENT.*

 

Unlessthe offering and sale of the Shares to be issued upon the particular exerciseor acceptance of a Stock Right shall have been effectively registered under theSecurities Act of 1933, as now in force or hereafter amended (the “1933 Act”),the Company shall be under no obligation to issue the Shares covered by suchexercise unless and until the following conditions have been fulfilled:

 

a.     The person(s) whoexercise(s) or accept(s) such Stock Right shall warrant to the Company,prior to the receipt of such Shares, that such person(s) are acquiringsuch Shares for their own respective accounts, for investment, and not with aview to, or for sale in connection with, the distribution of any such Shares,in which event the person(s) acquiring such Shares shall be bound by theprovisions of the following legend which shall be endorsed upon thecertificate(s) evidencing their Shares issued pursuant to such exercise orsuch grant:

 

“Theshares represented by this certificate have been taken for investment and theymay not be sold or otherwise transferred by any person, including a pledgee,unless (1) either (a) a Registration Statement with respect to suchshares shall be effective under the Securities Act of 1933, as amended, or(b) the Company shall have received an opinion of counsel satisfactory toit that an exemption from registration under such Act is then available, and(2) there shall have been compliance with all applicable state securitieslaws.”

 

b.     At the discretion of theAdministrator, the Company shall have received an opinion of its counsel thatthe Shares may be issued upon such particular exercise or acceptance incompliance with the 1933 Act without registration thereunder.

 

24.*  **DISSOLUTIONOR LIQUIDATION OF THE COMPANY.*

 

Uponthe dissolution or liquidation of the Company, all Options granted under thisPlan which as of such date shall not have been exercised and all Stock Grantsand Stock-Based Awards which have not been accepted will terminate and becomenull and void; provided, however, that if the rights of a Participant or aParticipant’s Survivors have not otherwise terminated and expired, theParticipant or the Participant’s Survivors will have the right immediatelyprior to such dissolution or liquidation to exercise or accept any Stock Rightto the extent that the Stock Right is exercisable or subject to acceptance asof the date immediately prior to such dissolution or liquidation. Upon thedissolution or liquidation of the Company, any outstanding Stock-Based Awardsshall immediately terminate unless otherwise determined by the Administrator orspecifically provided in the applicable Agreement.

 

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25.*  **ADJUSTMENTS.*

 

Uponthe occurrence of any of the following events, a Participant’s rights withrespect to any Stock Right granted to him or her hereunder shall be adjusted ashereinafter provided, unless otherwise specifically provided in a Participant’sAgreement:

 

a.*  StockDividends and Stock Splits.* If (i) the shares of Common Stock shall be subdivided or combinedinto a greater or smaller number of shares or if the Company shall issue anyshares of Common Stock as a stock dividend on its outstanding Common Stock, or(ii) additional shares or new or different shares or other securities ofthe Company or other non-cash assets are distributed with respect to suchshares of Common Stock, the number of shares of Common Stock deliverable uponthe exercise of an Option or acceptance of a Stock Grant shall be appropriatelyincreased or decreased proportionately, and appropriate adjustments shall bemade including, in the purchase price per share, to reflect such events. Thenumber of Shares subject to the limitations in Paragraph 3(a), 3(b) and4(c) shall also be proportionately adjusted upon the occurrence of suchevents and the Performance Goals applicable to outstanding Performance-BasedAwards.

 

b.*  CorporateTransactions.*  If the Companyis to be consolidated with or acquired by another entity in a merger, sale ofall or substantially all of the Company’s assets other than a transaction tomerely change the state of incorporation (a “Corporate Transaction”), theAdministrator or the board of directors of any entity assuming the obligationsof the Company hereunder (the “Successor Board”), shall, as to outstandingOptions, either (i) make appropriate provision for the continuation ofsuch Options by substituting on an equitable basis for the Shares then subjectto such Options either the consideration payable with respect to theoutstanding shares of Common Stock in connection with the Corporate Transactionor securities of any successor or acquiring entity; or (ii) upon writtennotice to the Participants, provide that all Options must be exercised (either(A) to the extent then exercisable or, (B) at the discretion of theAdministrator, all Options being made fully exercisable for purposes of thisSubparagraph), within a specified number of days of the date of such notice, atthe end of which period the Options shall terminate; or (iii) terminateall Options in exchange for a cash payment equal to the excess of the FairMarket Value of the Shares subject to such Options (either (A) to theextent then exercisable or, (B) at the discretion of the Administrator,all Options being made fully exercisable for purposes of this Subparagraph)over the exercise price thereof.

 

Withrespect to outstanding Stock Grants, the Administrator or the Successor Board,shall either (i) make appropriate provisions for the continuation of suchStock Grants on the same terms and conditions by substituting on an equitablebasis for the Shares then subject to such Stock Grants either the considerationpayable with respect to the outstanding Shares of Common Stock in connectionwith the Corporate Transaction or securities of any successor or acquiringentity; or (ii) terminate all Stock Grants in exchange for a cash paymentequal to the excess of the Fair Market Value of the Shares subject to suchStock Grants over the purchase price thereof, if any. In addition, in the eventof a Corporate Transaction, the Administrator may waive any or all Companyforfeiture or repurchase rights with respect to outstanding Stock Grants.

 

c.* Recapitalization or Reorganization.*  In the event of a recapitalization orreorganization of the Company other than a Corporate Transaction pursuant towhich securities of the Company or of another corporation are issued withrespect to the outstanding shares of Common Stock, a Participant uponexercising an Option or accepting a Stock Grant after the recapitalization orreorganization shall be entitled to receive for the purchase price paid uponsuch exercise or acceptance of the number of replacement securities which wouldhave been received if such Option had been exercised or Stock Grant acceptedprior to such recapitalization or reorganization.

 

d.*  Adjustmentsto Stock-Based Awards.*  Uponthe happening of any of the events described in Subparagraphs a, b or cabove, any outstanding Stock-Based Award shall be appropriately adjusted toreflect the events described in such Subparagraphs. The Administrator or theSuccessor Board shall

 

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determine the specificadjustments to be made under this Paragraph 25, including, but not limitedto the effect if any, of a Change of Control and, subject to Paragraph 4,its determination shall be conclusive.

 

e.*  Modificationof ISOs.*  Notwithstanding theforegoing, any adjustments made pursuant to Subparagraph a, b or c abovewith respect to ISOs shall be made only after the Administrator determineswhether such adjustments would constitute a “modification” of such ISOs (asthat term is defined in Section 424(h) of the Code) or would causeany adverse tax consequences for the holders of such ISOs. If the Administratordetermines that such adjustments made with respect to ISOs would constitute amodification of such ISOs, it may refrain from making such adjustments, unlessthe holder of an ISO specifically agrees in writing that such adjustment bemade and such writing indicates that the holder has full knowledge of theconsequences of such “modification” on his or her income tax treatment withrespect to the ISO. This paragraph shall not apply to the acceleration of thevesting of any ISO that would cause any portion of the ISO to violate theannual vesting limitation contained in Section 422(d) of the Code, asdescribed in Paragraph 6b(iv).

 

f.*  Modificationof Performance-Based Awards.* Notwithstanding the foregoing, with respect to any Performance-BasedAward that is intended to comply as “performance based compensation” underSection 162(m) of the Code, the Committee may adjust downwards, butnot upwards, the number of Shares payable pursuant to a Performance-BasedAward, and the Committee may not waive the achievement of the applicablePerformance Goals except in the case of death or disability of the Participant.

 

26.*  **ISSUANCESOF SECURITIES.*

 

Exceptas expressly provided herein, no issuance by the Company of shares of stock ofany class, or securities convertible into shares of stock of any class, shallaffect, and no adjustment by reason thereof shall be made with respect to, thenumber or price of shares subject to Stock Rights. Except as expressly providedherein, no adjustments shall be made for dividends paid in cash or in property(including without limitation, securities) of the Company prior to any issuanceof Shares pursuant to a Stock Right.

 

27.*  **FRACTIONALSHARES.*

 

Nofractional shares shall be issued under the Plan and the person exercising aStock Right shall receive from the Company cash in lieu of such fractionalshares equal to the Fair Market Value thereof.

 

28.*  **CONVERSIONOF ISOs INTO NON-QUALIFIED OPTIONS; TERMINATION OF ISOs.*

 

TheAdministrator, at the written request of any Participant, may in its discretiontake such actions as may be necessary to convert such Participant’s ISOs (orany portions thereof) that have not been exercised on the date of conversioninto Non-Qualified Options at any time prior to the expiration of such ISOs,regardless of whether the Participant is an employee of the Company or anAffiliate at the time of such conversion. At the time of such conversion, theAdministrator (with the consent of the Participant) may impose such conditionson the exercise of the resulting Non-Qualified Options as the Administrator inits discretion may determine, provided that such conditions shall not beinconsistent with this Plan. Nothing in the Plan shall be deemed to give anyParticipant the right to have such Participant’s ISOs converted intoNon-Qualified Options, and no such conversion shall occur until and unless theAdministrator takes appropriate action. The Administrator, with the consent ofthe Participant, may also terminate any portion of any ISO that has not beenexercised at the time of such conversion.

 

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29.*  **WITHHOLDING.*

 

Inthe event that any federal, state, or local income taxes, employment taxes,Federal Insurance Contributions Act (“F.I.C.A.”) withholdings or other amountsare required by applicable law or governmental regulation to be withheld fromthe Participant’s salary, wages or other remuneration in connection with theexercise or acceptance of a Stock Right or in connection with a DisqualifyingDisposition (as defined in Paragraph 30) or upon the lapsing of anyforfeiture provision or right of repurchase or for any other reason required bylaw, the Company may withhold from the Participant’s compensation, if any, ormay require that the Participant advance in cash to the Company, or to anyAffiliate of the Company which employs or employed the Participant, thestatutory minimum amount of such withholdings unless a different withholdingarrangement, including the use of shares of the Company’s Common Stock or apromissory note, is authorized by the Administrator (and permitted by law). Forpurposes hereof, the fair market value of the shares withheld for purposes ofpayroll withholding shall be determined in the manner provided inParagraph 1 above, as of the most recent practicable date prior to thedate of exercise. If the fair market value of the shares withheld is less thanthe amount of payroll withholdings required, the Participant may be required toadvance the difference in cash to the Company or the Affiliate employer. TheAdministrator in its discretion may condition the exercise of an Option forless than the then Fair Market Value on the Participant’s payment of suchadditional withholding.

 

30.*  **NOTICETO COMPANY OF DISQUALIFYING DISPOSITION.*

 

EachEmployee who receives an ISO must agree to notify the Company in writingimmediately after the Employee makes a Disqualifying Disposition of any sharesacquired pursuant to the exercise of an ISO. A Disqualifying Disposition isdefined in Section 424(c) of the Code and includes any disposition(including any sale or gift) of such shares before the later of (a) twoyears after the date the Employee was granted the ISO, or (b) one yearafter the date the Employee acquired Shares by exercising the ISO, except asotherwise provided in Section 424(c) of the Code. If the Employee hasdied before such stock is sold, these holding period requirements do not applyand no Disqualifying Disposition can occur thereafter.

 

31.*  **TERMINATIONOF THE PLAN.*

 

ThePlan will terminate on May 23, 2017, the date which is ten years from the *earlier* of the date of its adoption by theBoard of Directors and the date of its approval by the shareholders of theCompany. The Plan may be terminated at an earlier date by vote of theshareholders or the Board of Directors of the Company; provided, however, thatany such earlier termination shall not affect any Agreements executed prior tothe effective date of such termination.

 

32.*  **AMENDMENTOF THE PLAN AND AGREEMENTS.*

 

ThePlan may be amended by the shareholders of the Company. The Plan may also beamended by the Administrator , including, without limitation, to the extentnecessary to qualify any or all outstanding Stock Rights granted under the Planor Stock Rights to be granted under the Plan for favorable federal income taxtreatment (including deferral of taxation upon exercise) as may be affordedincentive stock options under Section 422 of the Code; to the extentnecessary to qualify the shares issuable upon exercise or acceptance of anyoutstanding Stock Rights granted, or Stock Rights to be granted, under the Planfor listing on any national securities exchange or quotation in any nationalautomated quotation system of securities dealers; and in order to continue tocomply with Section 162(m) of the Code; provided that any amendmentapproved by the Administrator which the Administrator determines is of a scopethat requires shareholder approval shall be subject to obtaining suchshareholder approval. Nothing in this Paragraph 32 shall limit theAdministrator’s authority to take any action permitted pursuant toParagraph 25.

 

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Anymodification or amendment of the Plan shall not, without the consent of aParticipant, adversely affect his or her rights under a Stock Right previouslygranted to him or her. With the consent of the Participant affected, theAdministrator may amend outstanding Agreements in a manner which may be adverseto the Participant but which is not inconsistent with the Plan. In thediscretion of the Administrator, outstanding Agreements may be amended by theAdministrator in a manner which is not adverse to the Participant.

 

33.*  **EMPLOYMENTOR OTHER RELATIONSHIP.*

 

Nothingin this Plan or any Agreement shall be deemed to prevent the Company or anAffiliate from terminating the employment, consultancy or director status of aParticipant, nor to prevent a Participant from terminating his or her ownemployment, consultancy or director status or to give any Participant a rightto be retained in employment or other service by the Company or any Affiliatefor any period of time.

 

34.*  **GOVERNINGLAW.*

 

ThisPlan shall be construed and enforced in accordance with the law of the State ofDelaware.

 

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**INCENTIVE STOCK OPTION AGREEMENT**

 

**ENERNOC, INC.**

 

AGREEMENTmade as of the      day of              200            , between EnerNOC, Inc. (the “Company”),a Delaware corporation and                         , an employee of theCompany (the “Employee”).

 

WHEREAS,the Company desires to grant to the Employee an Option to purchase shares ofits common stock, $.001 par value per share (the “Shares”), under and for thepurposes set forth in the Company’s Amended and Restated 2007 Employee,Director and Consultant Stock Plan (the “Plan”);

 

WHEREAS,the Company and the Employee understand and agree that any terms used and notdefined herein have the same meanings as in the Plan; and

 

WHEREAS,the Company and the Employee each intend that the Option granted herein qualifyas an ISO.

 

NOW,THEREFORE, in consideration of the mutual covenants hereinafter set forth andfor other good and valuable consideration, the parties hereto agree as follows:

 

1.*            **GRANTOF OPTION.*

 

TheCompany hereby grants to the Employee the right and option to purchase all orany part of an aggregate of                  Shares, on the terms and conditions and subject to all the limitations setforth herein, under United States securities and tax laws, and in the Plan,which is incorporated herein by reference. The Employee acknowledges receipt ofa copy of the Plan.

 

2.*            **PURCHASEPRICE.*

 

Thepurchase price of the Shares covered by the Option shall be $             per Share, subject to adjustment,as provided in the Plan, in the event of a stock split, reverse stock split orother events affecting the holders of Shares after the date hereof (the “PurchasePrice”). Payment shall be made in accordance with Paragraph 9 of the Plan.

 

3.*            **EXERCISABILITYOF OPTION.*

 

Subjectto the terms and conditions set forth in this Agreement and the Plan, theOption granted hereby shall become exercisable as follows:

 
| On the first anniversary  of the date of this Agreement  |   | up to              | Shares |
|----------------------------------------------------------|--------|--------------------|--------|
|                                                     |   |               |   |   |
| On the second anniversary  of the date of this Agreement |   | an additional |   | Shares |
|                                                     |   |               |   |   |
| On the third anniversary  of the date of this Agreement  |   | an additional      |   | Shares |
|                                                     |   |               |   |   |
| On the fourth anniversary  of the date of this Agreement |   | an additional      |   | Shares |

 

Theforegoing rights are cumulative and are subject to the other terms and conditionsof this Agreement and the Plan.

 

**[Acceleratedvesting on Change of Control to be determined on a grant-by-grant basis]** [Notwithstandingthe foregoing, in the event of a Change of Control (as defined below),     % of the Shares which would have vested ineach vesting installment remaining under this Option will be vested forpurposes of Section 24(B) of the Plan unless this Option hasotherwise expired or been terminated pursuant to its terms or the terms of thePlan.

 

*Change of Control* means the occurrence of anyof the following events:

 

(i)            Ownership.  Any “Person” (as such term is used inSections 13(d) and 14(d) of the Securities Exchange Act of 1934, asamended) becomes the “Beneficial Owner” (as defined in Rule 13d-3 undersaid Act), directly or indirectly, of securities of the Company representing50% 

 

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ormore of the total voting power represented by the Company’s then outstandingvoting securities (excluding for this purpose the Company or its Affiliates orany employee benefit plan of the Company) pursuant to a transaction or a seriesof related transactions which the Board of Directors does not approve; or

 

(ii)           Merger/Sale of Assets.  A merger or consolidation of the Companywhether or not approved by the Board of Directors, other than a merger orconsolidation which would result in the voting securities of the Companyoutstanding immediately prior thereto continuing to represent (either byremaining outstanding or by being converted into voting securities of thesurviving entity or the parent of such corporation) at least 50% of the totalvoting power represented by the voting securities of the Company or suchsurviving entity or parent of such corporation outstanding immediately aftersuch merger or consolidation, or the stockholders of the Company approve anagreement for the sale or disposition by the Company of all or substantiallyall of the Company’s assets; or

 

(iii)          Change in BoardComposition.  A change in the compositionof the Board of Directors, as a result of which fewer than a majority of thedirectors are Incumbent Directors. “Incumbent Directors” shall mean directorswho either (A) are directors of the Company as of [insert grant date], or(B) are elected, or nominated for election, to the Board of Directors withthe affirmative votes of at least a majority of the Incumbent Directors at thetime of such election or nomination (but shall not include an individual whoseelection or nomination is in connection with an actual or threatened proxycontest relating to the election of directors to the Company).]

 

4.*            **TERMOF OPTION.*

 

ThisOption shall terminate _______ years from the date of this Agreement or, if theEmployee owns as of the date hereof more than 10% of the total combined votingpower of all classes of capital stock of the Company or an Affiliate, fiveyears from the date of this Agreement, but shall be subject to earliertermination as provided herein or in the Plan.

 

Ifthe Employee ceases to be an employee of the Company or of an Affiliate (forany reason other than the death or Disability of the Employee or termination ofthe Employee’s employment for “cause”), the Option may be exercised, if it hasnot previously terminated, within three months after the date the Employeeceases to be an employee of the Company or an Affiliate, or within theoriginally prescribed term of the Option, whichever is earlier, but may not beexercised thereafter except as set forth below. In such event, the Option shallbe exercisable only to the extent that the Option has become exercisable and isin effect at the date of such cessation of employment.

 

Ifthe Employee ceases to be an employee of the Company or of an Affiliate butcontinues after termination of employment to provide service to the Company oran Affiliate as a consultant, this Option shall continue to vest in accordancewith Section 3 above as if this Option had not terminated until theEmployee is no longer providing services to the Company. In such case, thisOption shall automatically convert and be deemed a Non-Qualified Option as ofthe date that is three months from termination of the Employee’s employment andthis Option shall continue on the same terms and conditions set forth hereinuntil such Employee is no longer providing service to the Company or anAffiliate.

 

Notwithstandingthe foregoing, in the event of the Employee’s Disability or death within threemonths after the termination of employment, the Employee or the Employee’sSurvivors may exercise the Option within one year after the date of theEmployee’s termination of employment, but in no event after the date ofexpiration of the term of the Option.

 

Inthe event the Employee’s employment is terminated by the Employee’s employerfor “cause”, the Employee’s right to exercise any unexercised portion of thisOption shall cease immediately as of the time the Employee is notified his orher employment is terminated for “cause,” and this Option 

 

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shall thereupon terminate.Notwithstanding anything herein to the contrary, if subsequent to the Employee’stermination as an employee, but prior to the exercise of the Option, the Boardof Directors of the Company determines that, either prior or subsequent to theEmployee’s termination, the Employee engaged in conduct which would constitute “cause,”then the Employee shall immediately cease to have any right to exercise theOption and this Option shall thereupon terminate.

 

Inthe event of the Disability of the Employee, as determined in accordance withthe Plan, the Option shall be exercisable within one year after the Employee’stermination of employment or, if earlier, within the term originally prescribedby the Option. In such event, the Option shall be exercisable:

 

(a)           to the extent that theOption has become exercisable but has not been exercised as of the date ofDisability; and

 

(b)           in the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of Disability of any additional vesting rights that would haveaccrued on the next vesting date had the Employee not become Disabled. Theproration shall be based upon the number of days accrued in the current vestingperiod prior to the date of Disability.

 

Inthe event of the death of the Employee while an employee of the Company or ofan Affiliate, the Option shall be exercisable by the Employee’s Survivorswithin one year after the date of death of the Employee or, if earlier, withinthe originally prescribed term of the Option. In such event, the Option shallbe exercisable:

 

(x)            to the extent that theOption has become exercisable but has not been exercised as of the date ofdeath; and

 

(y)           in the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of death of any additional vesting rights that would haveaccrued on the next vesting date had the Employee not died. The proration shallbe based upon the number of days accrued in the current vesting period prior tothe Employee’s date of death.

 

5.*            **METHODOF EXERCISING OPTION.*

 

Subjectto the terms and conditions of this Agreement, the Option may be exercised bywritten notice to the Company or its designee, in substantially the form of *Exhibit A* attached hereto. Suchnotice shall state the number of Shares with respect to which the Option isbeing exercised and shall be signed by the person exercising the Option.Payment of the purchase price for such Shares shall be made in accordance withParagraph 9 of the Plan. The Company shall deliver such Shares as soon aspracticable after the notice shall be received, provided, however, that theCompany may delay issuance of such Shares until completion of any action orobtaining of any consent, which the Company deems necessary under anyapplicable law (including, without limitation, state securities or “blue sky”laws). The Shares as to which the Option shall have been so exercised shall beregistered in the Company’s share register in the name of the person soexercising the Option (or, if the Option shall be exercised by the Employee andif the Employee shall so request in the notice exercising the Option, shall beregistered in the name of the Employee and another person jointly, with rightof survivorship) and shall be delivered as provided above to or upon thewritten order of the person exercising the Option. In the event the Optionshall be exercised, pursuant to Section 4 hereof, by any person other thanthe Employee, such notice shall be accompanied by appropriate proof of theright of such person to exercise the Option. All Shares that shall be purchasedupon the exercise of the Option as provided herein shall be fully paid andnonassessable.

 

6.*            **PARTIALEXERCISE.*

 

Exerciseof this Option to the extent above stated may be made in part at any time andfrom time to time within the above limits, except that no fractional shareshall be issued pursuant to this Option.

 

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7.*            **NON-ASSIGNABILITY.*

 

TheOption shall not be transferable by the Employee otherwise than by will or bythe laws of descent and distribution. The Option shall be exercisable, duringthe Employee’s lifetime, only by the Employee (or, in the event of legalincapacity or incompetency, by the Employee’s guardian or representative) andshall not be assigned, pledged or hypothecated in any way (whether by operationof law or otherwise) and shall not be subject to execution, attachment orsimilar process. Any attempted transfer, assignment, pledge, hypothecation orother disposition of the Option or of any rights granted hereunder contrary tothe provisions of this Section 7, or the levy of any attachment or similarprocess upon the Option shall be null and void.

 

8.*            **NORIGHTS AS STOCKHOLDER UNTIL EXERCISE.*

 

TheEmployee shall have no rights as a stockholder with respect to Shares subjectto this Agreement until registration of the Shares in the Company’s shareregister in the name of the Employee. Except as is expressly provided in thePlan with respect to certain changes in the capitalization of the Company, noadjustment shall be made for dividends or similar rights for which the recorddate is prior to the date of such registration.

 

9.*            **ADJUSTMENTS.*

 

ThePlan contains provisions covering the treatment of Options in a number ofcontingencies such as stock splits and mergers. Provisions in the Plan foradjustment with respect to stock subject to Options and the related provisionswith respect to successors to the business of the Company are hereby madeapplicable hereunder and are incorporated herein by reference. [; provided,however, that in the event of a Change of Control (as defined in Section 3above)             % of the Shares whichwould have vested in each vesting installment remaining under this Option willbe vested for purposes of Section 25(B) of the Plan.]

 

10.*          **TAXES.*

 

TheEmployee acknowledges that any income or other taxes due from him or her withrespect to this Option or the Shares issuable pursuant to this Option shall bethe Employee’s responsibility.

 

Inthe event of a Disqualifying Disposition (as defined in Section 15 below)or if the Option is converted into a Non-Qualified Option and suchNon-Qualified Option is exercised, the Company may withhold from the Employee’sremuneration, if any, the minimum statutory amount of federal, state and localwithholding taxes attributable to such amount that is considered compensationincludable in such person’s gross income. At the Company’s discretion, theamount required to be withheld may be withheld in cash from such remuneration,or in kind from the Shares otherwise deliverable to the Employee on exercise ofthe Option. The Employee further agrees that, if the Company does not withholdan amount from the Employee’s remuneration sufficient to satisfy the Company’sincome tax withholding obligation, the Employee will reimburse the Company ondemand, in cash, for the amount under-withheld.

 

11.*          **PURCHASEFOR INVESTMENT.*

 

Unlessthe offering and sale of the Shares to be issued upon the particular exerciseof the Option shall have been effectively registered under the Securities Actof 1933, as now in force or hereafter amended (the “1933 Act”), the Companyshall be under no obligation to issue the Shares covered by such exerciseunless and until the following conditions have been fulfilled:

 

(a)           The person(s) whoexercise the Option shall warrant to the Company, at the time of such exercise,that such person(s) are acquiring such Shares for their own respectiveaccounts, for investment, and not with a view to, or for sale in connectionwith, the distribution of any such Shares, in which event the person(s) acquiringsuch Shares shall be bound by the provisions of the 

 

4

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followinglegend which shall be endorsed upon the certificate(s) evidencing theShares issued pursuant to such exercise:

 

“Theshares represented by this certificate have been taken for investment and theymay not be sold or otherwise transferred by any person, including a pledgee,unless (1) either (a) a Registration Statement with respect to suchshares shall be effective under the Securities Act of 1933, as amended, or(b) the Company shall have received an opinion of counsel satisfactory toit that an exemption from registration under such Act is then available, and(2) there shall have been compliance with all applicable state securitieslaws;” and

 

(b)           If the Company so requires,the Company shall have received an opinion of its counsel that the Shares maybe issued upon such particular exercise in compliance with the 1933 Act withoutregistration thereunder. Without limiting the generality of the foregoing, theCompany may delay issuance of the Shares until completion of any action orobtaining of any consent, which the Company deems necessary under anyapplicable law (including without limitation state securities or “blue sky”laws).

 

12.*          **RESTRICTIONSON TRANSFER OF SHARES.*

 

12.1         The Employee agrees that inthe event the Company proposes to offer for sale to the public any of itsequity securities and such Employee is requested by the Company and anyunderwriter engaged by the Company in connection with such offering to sign anagreement restricting the sale or other transfer of Shares, then it willpromptly sign such agreement and will not transfer, whether in privatelynegotiated transactions or to the public in open market transactions orotherwise, any Shares or other securities of the Company held by him or herduring such period as is determined by the Company and the underwriters, not toexceed 180 days following the closing of the offering, plus suchadditional period of time as may be required to comply with MarketplaceRule 2711 of the National Association of Securities Dealers, Inc. orsimilar rules thereto (such period, the “Lock-Up Period”). Such agreementshall be in writing and in form and substance reasonably satisfactory to theCompany and such underwriter and pursuant to customary and prevailing terms andconditions. Notwithstanding whether the Employee has signed such an agreement,the Company may impose stop-transfer instructions with respect to the Shares orother securities of the Company subject to the foregoing restrictions until theend of the Lock-Up Period.

 

12.2         The Employee acknowledgesand agrees that neither the Company, its shareholders nor its directors andofficers, has any duty or obligation to disclose to the Employee any materialinformation regarding the business of the Company or affecting the value of theShares before, at the time of, or following a termination of the employment ofthe Employee by the Company, including, without limitation, any informationconcerning plans for the Company to make a public offering of its securities orto be acquired by or merged with or into another firm or entity.

 

13.*          **NOOBLIGATION TO EMPLOY.*

 

TheCompany is not by the Plan or this Option obligated to continue the Employee asan employee of the Company or an Affiliate. The Employee acknowledges:(i) that the Plan is discretionary in nature and may be suspended orterminated by the Company at any time; (ii) that the grant of the Optionis a one-time benefit which does not create any contractual or other right toreceive future grants of options, or benefits in lieu of options;(iii) that all determinations with respect to any such future grants,including, but not limited to, the times when options shall be granted, thenumber of shares subject to each option, the option price, and the time ortimes when each option shall be exercisable, will be at the sole discretion ofthe Company; (iv) that the Employee’s participation in the Plan isvoluntary; (v) that the value of the Option is an extraordinary item ofcompensation which is outside the scope of the Employee’s employment contract,if any; and (vi) that the Option is not part of normal or expectedcompensation for purposes of calculating any severance, 

 

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resignation, redundancy, endof service payments, bonuses, long-service awards, pension or retirementbenefits or similar payments.

 

14.*          **OPTIONIS INTENDED TO BE AN ISO.*

 

Theparties each intend that the Option be an ISO so that the Employee (or theEmployee’s Survivors) may qualify for the favorable tax treatment provided toholders of Options that meet the standards of Section 422 of the Code. Anyprovision of this Agreement or the Plan which conflicts with the Code so thatthis Option would not be deemed an ISO is null and void and any ambiguitiesshall be resolved so that the Option qualifies as an ISO. Nonetheless, if theOption is determined not to be an ISO, the Employee understands that neitherthe Company nor any Affiliate is responsible to compensate him or her orotherwise make up for the treatment of the Option as a Non-Qualified Option andnot as an ISO. The Employee should consult with the Employee’s own tax advisorsregarding the tax effects of the Option and the requirements necessary toobtain favorable tax treatment under Section 422 of the Code, including,but not limited to, holding period requirements.

 

Notwithstandingthe foregoing, to the extent that the Option is not deemed to be an ISOpursuant to Section 422(d) of the Code because the aggregate fairmarket value (determined as of the date hereof) of any of the Shares withrespect to which this ISO is granted becomes exercisable for the first timeduring any calendar year in excess of $100,000, the portion of the Optionrepresenting such excess value shall be treated as a Non-Qualified Option andthe Employee shall be deemed to have taxable income measured by the differencebetween the then fair market value of the Shares received upon exercise and theprice paid for such Shares pursuant to this Agreement.

 

15.*          **NOTICETO COMPANY OF DISQUALIFYING DISPOSITION.*

 

TheEmployee agrees to notify the Company in writing immediately after the Employeemakes a Disqualifying Disposition of any of the Shares acquired pursuant to theexercise of the Option. A Disqualifying Disposition is defined inSection 424(c) of the Code and includes any disposition (includingany sale) of such Shares before the later of (a) two years after the datethe Employee was granted the Option or (b) one year after the date theEmployee acquired Shares by exercising the Option, except as otherwise providedin Section 424(c) of the Code. If the Employee has died before theShares are sold, these holding period requirements do not apply and noDisqualifying Disposition can occur thereafter.

 

16.*          **NOTICES.*

 

Anynotices required or permitted by the terms of this Agreement or the Plan shallbe given by recognized courier service, facsimile, registered or certifiedmail, return receipt requested, addressed as follows:

 
|   |                               |                                                                               |   |
|--------|------------------------------------|------------------------------------------------------------------------------------|--------|
|   | If to the Company:  |                                                                               |   |
|   |                               | EnerNOC, Inc.                                                                 |   |
|   |                               | Attn: Chief Financial   Officer 101 Federal Street, Suite 1100 |   |
|   |                               | Boston, MA 02110                                                                   |   |
|   | If to the Employee: |                                                                               |   |
|   |                               |                                                                               |   |
|   |                               |                                                                               |   |
|   |                               |                                                                               |   |

 

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or to such other address oraddresses of which notice in the same manner has previously been given. Anysuch notice shall be deemed to have been given upon the earlier of receipt, onebusiness day following delivery to a recognized courier service or threebusiness days following mailing by registered or certified mail.

 

17.*          **GOVERNINGLAW.*

 

ThisAgreement shall be construed and enforced in accordance with the law of theState of Delaware, without giving effect to the conflict of law principlesthereof. For the purpose of litigating any dispute that arises under thisAgreement, the parties hereby consent to exclusive jurisdiction in the Commonwealthof Massachusetts and agree that such litigation shall be conducted in thecourts of Suffolk County, Massachusetts or the federal courts of the UnitedStates for the District of Massachusetts.

 

18.*          **BENEFITOF AGREEMENT.*

 

Subjectto the provisions of the Plan and the other provisions hereof, this Agreementshall be for the benefit of and shall be binding upon the heirs, executors,administrators, successors and assigns of the parties hereto.

 

19.*          **ENTIREAGREEMENT.*

 

ThisAgreement, together with the Plan, embodies the entire agreement andunderstanding between the parties hereto with respect to the subject matterhereof and supersedes all prior oral or written agreements and understandingsrelating to the subject matter hereof. No statement, representation, warranty,covenant or agreement not expressly set forth in this Agreement shall affect orbe used to interpret, change or restrict, the express terms and provisions ofthis Agreement, provided, however, in any event, this Agreement shall besubject to and governed by the Plan.

 

20.*          **MODIFICATIONSAND AMENDMENTS.*

 

Theterms and provisions of this Agreement may be modified or amended as providedin the Plan.

 

21.*          **WAIVERSAND CONSENTS.*

 

Exceptas provided in the Plan, the terms and provisions of this Agreement may bewaived, or consent for the departure therefrom granted, only by writtendocument executed by the party entitled to the benefits of such terms orprovisions. No such waiver or consent shall be deemed to be or shall constitutea waiver or consent with respect to any other terms or provisions of thisAgreement, whether or not similar. Each such waiver or consent shall beeffective only in the specific instance and for the purpose for which it wasgiven, and shall not constitute a continuing waiver or consent.

 

22.*          **DATAPRIVACY.*

 

Byentering into this Agreement, the Employee: (i) authorizes the Company andeach Affiliate, and any agent of the Company or any Affiliate administering thePlan or providing Plan recordkeeping services, to disclose to the Company orany of its Affiliates such information and data as the Company or any suchAffiliate shall request in order to facilitate the grant of options and theadministration of the Plan; (ii) waives any data privacy rights he or shemay have with respect to such information; and (iii) authorizes theCompany and each Affiliate to store and transmit such information in electronicform.

 

[REMAINDEROF PAGE INTENTIONALLY LEFT BLANK]

 

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INWITNESS WHEREOF, the Company has caused this Agreement to be executed by itsduly authorized officer, and the Employee has hereunto set his or her hand, allas of the day and year first above written.

 
|   | ENERNOC, INC. |
|--------|--------------------|
|   |               |
|   | By:                |   |
|   |               | Name |
|   |               | Title |
|   |               |
|   |               |
|   | Employee           |

 

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**Exhibit A**

 

**NOTICE OF EXERCISE OF INCENTIVE STOCK OPTION**

 

TO:  EnerNOC, Inc.

 

IMPORTANT NOTICE: This formof Notice of Exercise may only be used at such time as the Company has filed aRegistration Statement with the Securities and Exchange Commission under whichthe issuance of the Shares for which this exercise is being made is registeredand such Registration Statement remains effective.

 

Ladies and Gentlemen:

 

Ihereby exercise my Incentive Stock Option to purchase                          shares (the “Shares”)of the common stock, $.001 par value, of EnerNOC, Inc. (the “Company”), atthe exercise price of $             pershare, pursuant to and subject to the terms of that certain Incentive StockOption Agreement between the undersigned and the Company dated                         , 200            .

 

Iunderstand the nature of the investment I am making and the financial risksthereof. I am aware that it is my responsibility to have consulted withcompetent tax and legal advisors about the relevant national, state and localincome tax and securities laws affecting the exercise of the Option and thepurchase and subsequent sale of the Shares.

 

Iam paying the option exercise price for the Shares as follows:
|   |   |   |
|--------|--------|--------|

 

Pleaseissue the Shares (check one):

 

o to me; or

 

o to me and                                                 , as jointtenants with right of survivorship,

 

atthe following address:

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 

A-1

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Mymailing address for shareholder communications, if different from the addresslisted above, is:

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 
|   | Very truly yours,      |
|--------|------------------------|
|   |                   |
|   |                   |
|   |                   |
|   | Employee (signature)   |
|   |                   |
|   |                   |
|   | Print Name             |
|   |                   |
|   |                   |
|   | Date                   |
|   |                   |
|   |                   |
|   | Social Security Number |

 

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**NON-QUALIFIED STOCK OPTIONAGREEMENT**

 

**ENERNOC, INC.**

 

AGREEMENTmade as of the      day of                          200            , between EnerNOC, Inc. (the “Company”),a Delaware corporation,                        , and                         (the “Participant”).

 

WHEREAS,the Company desires to grant to the Participant an Option to purchase shares ofits common stock, $.001 par value per share (the “Shares”), under and for thepurposes set forth in the Company’s Amended and Restated 2007 Employee, Directorand Consultant Stock Plan (the “Plan”);

 

WHEREAS,the Company and the Participant understand and agree that any terms used andnot defined herein have the same meanings as in the Plan; and

 

WHEREAS,the Company and the Participant each intend that the Option granted hereinshall be a Non-Qualified Option.

 

NOW,THEREFORE, in consideration of the mutual covenants hereinafter set forth andfor other good and valuable consideration, the parties hereto agree as follows:

 

1.*            **GRANT OFOPTION.*

 

TheCompany hereby grants to the Participant the right and option to purchase allor any part of an aggregate of                      Shares, on the terms and conditions and subject to all the limitations setforth herein, under United States securities and tax laws, and in the Plan,which is incorporated herein by reference. The Participant acknowledges receiptof a copy of the Plan.

 

2.*            **PURCHASEPRICE.*

 

Thepurchase price of the Shares covered by the Option shall be $             per Share, subject to adjustment,as provided in the Plan, in the event of a stock split, reverse stock split orother events affecting the holders of Shares after the date hereof (the “PurchasePrice”). Payment shall be made in accordance with Paragraph 9 of the Plan.

 

3.*            **EXERCISABILITYOF OPTION.*

 

Subjectto the terms and conditions set forth in this Agreement and the Plan, theOption granted hereby shall become exercisable as follows:

 
| On the first anniversary  of the date of this Agreement  |   | up to              | Shares |
|----------------------------------------------------------|--------|--------------------|--------|
|                                                     |   |               |   |   |
| On the second anniversary of  the date of this Agreement |   | an additional |   | Shares |
|                                                     |   |               |   |   |
| On the third anniversary  of the date of this Agreement  |   | an additional      |   | Shares |
|                                                     |   |               |   |   |
| On the fourth anniversary  of the date of this Agreement |   | an additional      |   | Shares |

 

Theforegoing rights are cumulative and are subject to the other terms andconditions of this Agreement and the Plan.

 

**[Acceleratedvesting on Change of Control to be determined on a grant-by-grant basis]**[Notwithstandingthe foregoing, in the event of a Change of Control (as defined below),     % of the Shares which would have vested ineach vesting installment remaining under this Option will be vested forpurposes of Section 24(B) of the Plan unless this Option hasotherwise expired or been terminated pursuant to its terms or the terms of thePlan.

 

*Change of Control* means the occurrence of anyof the following events:

 

(i)            Ownership.  Any “Person” (as such term is used inSections 13(d) and 14(d) of the Securities Exchange Act of 1934, asamended) becomes the “Beneficial Owner” (as defined in Rule 13d-3 undersaid Act), directly or indirectly, of securities of the Company representing50% or more of the total voting power represented by the Company’s thenoutstanding voting securities 

 

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(excludingfor this purpose the Company or its Affiliates or any employee benefit plan ofthe Company) pursuant to a transaction or a series of related transactionswhich the Board of Directors does not approve; or

 

(ii)           Merger/Sale ofAssets.  A merger or consolidation of theCompany whether or not approved by the Board of Directors, other than a mergeror consolidation which would result in the voting securities of the Companyoutstanding immediately prior thereto continuing to represent (either byremaining outstanding or by being converted into voting securities of thesurviving entity or the parent of such corporation) at least 50% of the totalvoting power represented by the voting securities of the Company or suchsurviving entity or parent of such corporation outstanding immediately aftersuch merger or consolidation, or the stockholders of the Company approve anagreement for the sale or disposition by the Company of all or substantiallyall of the Company’s assets; or

 

(iii)          Change in BoardComposition.  A change in the compositionof the Board of Directors, as a result of which fewer than a majority of thedirectors are Incumbent Directors. “Incumbent Directors” shall mean directorswho either (A) are directors of the Company as of [insert grant date], or(B) are elected, or nominated for election, to the Board of Directors withthe affirmative votes of at least a majority of the Incumbent Directors at thetime of such election or nomination (but shall not include an individual whoseelection or nomination is in connection with an actual or threatened proxycontest relating to the election of directors to the Company).]

 

4.*            **TERM OFOPTION.*

 

ThisOption shall terminate _____ years from the date of this Agreement, but shallbe subject to earlier termination as provided herein or in the Plan.

 

Ifthe Participant ceases to be an employee, director or consultant of the Companyor of an Affiliate (for any reason other than the death or Disability of theParticipant or termination of the Participant for “cause”, the Option may beexercised, if it has not previously terminated, within three months after thedate the Participant ceases to be an employee, director or consultant of theCompany or an Affiliate, or within the originally prescribed term of theOption, whichever is earlier, but may not be exercised thereafter. In suchevent, the Option shall be exercisable only to the extent that the Option hasbecome exercisable and is in effect at the date of such cessation of service.

 

Notwithstandingthe foregoing, in the event of the Participant’s Disability or death withinthree months after the termination of service, the Participant or theParticipant’s Survivors may exercise the Option within one year after the dateof the Participant’s termination of service, but in no event after the date ofexpiration of the term of the Option.

 

Inthe event the Participant’s service is terminated by the Company or anAffiliate for “cause”, the Participant’s right to exercise any unexercisedportion of this Option shall cease immediately as of the time the Participantis notified his or her service is terminated for “cause,” and this Option shallthereupon terminate. Notwithstanding anything herein to the contrary, ifsubsequent to the Participant’s termination, but prior to the exercise of theOption, the Board of Directors of the Company determines that, either prior orsubsequent to the Participant’s termination, the Participant engaged in conductwhich would constitute “cause,” then the Participant shall immediately cease tohave any right to exercise the Option and this Option shall thereuponterminate.

 

Inthe event of the Disability of the Participant, as determined in accordancewith the Plan, the Option shall be exercisable within one year after theParticipant’s termination of service or, if earlier, within the term originallyprescribed by the Option. In such event, the Option shall be exercisable:

 

(a)           to the extent that theOption has become exercisable but has not been exercised as of the date ofDisability; and

 

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(b)           in the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of Disability of any additional vesting rights that would haveaccrued on the next vesting date had the Participant not become Disabled. Theproration shall be based upon the number of days accrued in the current vestingperiod prior to the date of Disability.

 

Inthe event of the death of the Participant while an employee, director orconsultant of the Company or of an Affiliate, the Option shall be exercisableby the Participant’s Survivors within one year after the date of death of theParticipant or, if earlier, within the originally prescribed term of theOption. In such event, the Option shall be exercisable:

 

(x)            to the extent that theOption has become exercisable but has not been exercised as of the date ofdeath; and

 

(y)           in the event rights toexercise the Option accrue periodically, to the extent of a pro rata portionthrough the date of death of any additional vesting rights that would haveaccrued on the next vesting date had the Participant not died. The prorationshall be based upon the number of days accrued in the current vesting periodprior to the Participant’s date of death.

 

5.*            **METHOD OFEXERCISING OPTION.*

 

Subjectto the terms and conditions of this Agreement, the Option may be exercised bywritten notice to the Company or its designee, in substantially the form of *Exhibit A* attached hereto. Suchnotice shall state the number of Shares with respect to which the Option isbeing exercised and shall be signed by the person exercising the Option.Payment of the purchase price for such Shares shall be made in accordance withParagraph 9 of the Plan. The Company shall deliver such Shares as soon aspracticable after the notice shall be received, provided, however, that theCompany may delay issuance of such Shares until completion of any action orobtaining of any consent, which the Company deems necessary under anyapplicable law (including, without limitation, state securities or “blue sky”laws). The Shares as to which the Option shall have been so exercised shall beregistered in the Company’s share register in the name of the person soexercising the Option (or, if the Option shall be exercised by the Participantand if the Participant shall so request in the notice exercising the Option,shall be registered in the Company’s share register in the name of theParticipant and another person jointly, with right of survivorship) and shallbe delivered as provided above to or upon the written order of the personexercising the Option. In the event the Option shall be exercised, pursuant toSection 4 hereof, by any person other than the Participant, such noticeshall be accompanied by appropriate proof of the right of such person toexercise the Option. All Shares that shall be purchased upon the exercise ofthe Option as provided herein shall be fully paid and nonassessable.

 

6.*            **PARTIALEXERCISE.*

 

Exerciseof this Option to the extent above stated may be made in part at any time andfrom time to time within the above limits, except that no fractional shareshall be issued pursuant to this Option.

 

7.*            **NON-ASSIGNABILITY.*

 

TheOption shall not be transferable by the Participant otherwise than by will orby the laws of descent and distribution or pursuant to a qualified domesticrelations order as defined by the Code or Title I of the Employee RetirementIncome Security Act or the rules thereunder. Except as provided above inthis paragraph, the Option shall be exercisable, during the Participant’slifetime, only by the Participant (or, in the event of legal incapacity orincompetency, by the Participant’s guardian or representative) and shall not beassigned, pledged or hypothecated in any way (whether by operation of law or otherwise)and shall not be subject to execution, attachment or similar process. Anyattempted transfer, assignment, pledge, hypothecation or other disposition ofthe Option or of any rights granted hereunder contrary to the provisions ofthis Section 7, or the levy of any attachment or similar process upon theOption shall be null and void.

 

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8.*            **NO RIGHTSAS STOCKHOLDER UNTIL EXERCISE.*

 

TheParticipant shall have no rights as a stockholder with respect to Sharessubject to this Agreement until registration of the Shares in the Company’sshare register in the name of the Participant. Except as is expressly providedin the Plan with respect to certain changes in the capitalization of theCompany, no adjustment shall be made for dividends or similar rights for whichthe record date is prior to the date of such registration.

 

9.*            **ADJUSTMENTS.*

 

ThePlan contains provisions covering the treatment of Options in a number ofcontingencies such as stock splits and mergers. Provisions in the Plan foradjustment with respect to stock subject to Options and the related provisionswith respect to successors to the business of the Company are hereby madeapplicable hereunder and are incorporated herein by reference. [; provided,however, that in the event of a Change of Control (as defined in Section 3above)             % of the Shares whichwould have vested in each vesting installment remaining under this Option willbe vested for purposes of Section 25(B) of the Plan**.]**

 

10.*          **TAXES.*

 

TheParticipant acknowledges that upon exercise of the Option the Participant willbe deemed to have taxable income measured by the difference between the thenfair market value of the Shares received upon exercise and the price paid forsuch Shares pursuant to this Agreement. The Participant acknowledges that anyincome or other taxes due from him or her with respect to this Option or theShares issuable pursuant to this Option shall be the Participant’sresponsibility.

 

TheParticipant agrees that the Company may withhold from the Participant’sremuneration, if any, the minimum statutory amount of federal, state and localwithholding taxes attributable to such amount that is considered compensationincludable in such person’s gross income. At the Company’s discretion, theamount required to be withheld may be withheld in cash from such remuneration,or in kind from the Shares otherwise deliverable to the Participant on exerciseof the Option. The Participant further agrees that, if the Company does notwithhold an amount from the Participant’s remuneration sufficient to satisfythe Company’s income tax withholding obligation, the Participant will reimbursethe Company on demand, in cash, for the amount under-withheld.

 

11.*          **PURCHASEFOR INVESTMENT.*

 

Unlessthe offering and sale of the Shares to be issued upon the particular exerciseof the Option shall have been effectively registered under the Securities Actof 1933, as now in force or hereafter amended (the “1933 Act”), the Companyshall be under no obligation to issue the Shares covered by such exerciseunless and until the following conditions have been fulfilled:

 

(a)           The person(s) whoexercise the Option shall warrant to the Company, at the time of such exercise,that such person(s) are acquiring such Shares for their own respectiveaccounts, for investment, and not with a view to, or for sale in connectionwith, the distribution of any such Shares, in which event the person(s) acquiringsuch Shares shall be bound by the provisions of the following legend whichshall be endorsed upon the certificate(s) evidencing the Shares issuedpursuant to such exercise:

 

“Theshares represented by this certificate have been taken for investment and theymay not be sold or otherwise transferred by any person, including a pledgee,unless (1) either (a) a Registration Statement with respect to suchshares shall be effective under the Securities Act of 1933, as amended, or(b) the Company shall have received an opinion of counsel satisfactory toit that an exemption from registration under such Act is then available, and(2) there shall have been compliance with all applicable state securitieslaws;” and

 

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(b)           If the Company so requires,the Company shall have received an opinion of its counsel that the Shares maybe issued upon such particular exercise in compliance with the 1933 Act withoutregistration thereunder. Without limiting the generality of the foregoing, theCompany may delay issuance of the Shares until completion of any action orobtaining of any consent, which the Company deems necessary under anyapplicable law (including without limitation state securities or “blue sky”laws).

 

12.*          **RESTRICTIONSON TRANSFER OF SHARES.*

 

12.1         The Participant agrees that inthe event the Company proposes to offer for sale to the public any of itsequity securities and such Participant is requested by the Company and anyunderwriter engaged by the Company in connection with such offering to sign anagreement restricting the sale or other transfer of Shares, then it willpromptly sign such agreement and will not transfer, whether in privatelynegotiated transactions or to the public in open market transactions orotherwise, any Shares or other securities of the Company held by him or herduring such period as is determined by the Company and the underwriters, not toexceed 180 days following the closing of the offering, plus suchadditional period of time as may be required to comply with MarketplaceRule 2711 of the National Association of Securities Dealers, Inc. orsimilar rules thereto (such period, the “Lock-Up Period”). Such agreementshall be in writing and in form and substance reasonably satisfactory to theCompany and such underwriter and pursuant to customary and prevailing terms andconditions. Notwithstanding whether the Participant has signed such anagreement, the Company may impose stop-transfer instructions with respect tothe Shares or other securities of the Company subject to the foregoingrestrictions until the end of the Lock-Up Period.

 

12.2         The Participant acknowledgesand agrees that neither the Company, its shareholders nor its directors andofficers, has any duty or obligation to disclose to the Participant anymaterial information regarding the business of the Company or affecting thevalue of the Shares before, at the time of, or following a termination of theemployment of the Participant by the Company, including, without limitation,any information concerning plans for the Company to make a public offering ofits securities or to be acquired by or merged with or into another firm orentity.

 

13.*          **NOOBLIGATION TO MAINTAIN RELATIONSHIP.*

 

TheCompany is not by the Plan or this Option obligated to continue the Participantas an employee, director or consultant of the Company or an Affiliate. TheParticipant acknowledges: (i) that the Plan is discretionary in nature andmay be suspended or terminated by the Company at any time; (ii) that thegrant of the Option is a one-time benefit which does not create any contractualor other right to receive future grants of options, or benefits in lieu ofoptions; (iii) that all determinations with respect to any such futuregrants, including, but not limited to, the times when options shall be granted,the number of shares subject to each option, the option price, and the time ortimes when each option shall be exercisable, will be at the sole discretion ofthe Company; (iv) that the Participant’s participation in the Plan isvoluntary; (v) that the value of the Option is an extraordinary item ofcompensation which is outside the scope of the Participant’s employmentcontract, if any; and (vi) that the Option is not part of normal orexpected compensation for purposes of calculating any severance, resignation,redundancy, end of service payments, bonuses, long-service awards, pension orretirement benefits or similar payments.

 

5

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14.*          **NOTICES.*

 

Anynotices required or permitted by the terms of this Agreement or the Plan shallbe given by recognized courier service, facsimile, registered or certifiedmail, return receipt requested, addressed as follows:

 
|   | If to the Company:     |                                               |   |
|--------|---------------------------------------|----------------------------------------------------|--------|
|   |                                  | EnerNOC, Inc.                                 |   |
|   |                                  | Attn: Chief Financial   Officer                    |   |
|   |                                  | 101 Federal Street, Suite 1100 |   |
|   |                                  | Boston, MA 02110                                   |   |
|   |                                  |                                               |   |
|   | If to the Participant: |                                               |   |
|   |                                  |                                               |   |
|   |                                  |                                               |   |
|   |                                  |                                               |   |

 

or to such other address oraddresses of which notice in the same manner has previously been given. Anysuch notice shall be deemed to have been given upon the earlier of receipt, onebusiness day following delivery to a recognized courier service or threebusiness days following mailing by registered or certified mail.

 

15.*          **GOVERNINGLAW.*

 

ThisAgreement shall be construed and enforced in accordance with the law of the Stateof Delaware without giving effect to the conflict of law principles thereof.For the purpose of litigating any dispute that arises under this Agreement, theparties hereby consent to exclusive jurisdiction in the Commonwealth ofMassachusetts and agree that such litigation shall be conducted in the courtsof Suffolk County, Massachusetts or the federal courts of the United States forthe District of Massachusetts.

 

16.*          **BENEFIT OFAGREEMENT.*

 

Subjectto the provisions of the Plan and the other provisions hereof, this Agreementshall be for the benefit of and shall be binding upon the heirs, executors,administrators, successors and assigns of the parties hereto.

 

17.*          **ENTIREAGREEMENT.*

 

ThisAgreement, together with the Plan, embodies the entire agreement andunderstanding between the parties hereto with respect to the subject matterhereof and supersedes all prior oral or written agreements and understandingsrelating to the subject matter hereof. No statement, representation, warranty,covenant or agreement not expressly set forth in this Agreement shall affect orbe used to interpret, change or restrict, the express terms and provisions ofthis Agreement, provided, however, in any event, this Agreement shall besubject to and governed by the Plan.

 

18.*          **MODIFICATIONSAND AMENDMENTS.*

 

Theterms and provisions of this Agreement may be modified or amended as providedin the Plan.

 

19.*          **WAIVERSAND CONSENTS.*

 

Exceptas provided in the Plan, the terms and provisions of this Agreement may bewaived, or consent for the departure therefrom granted, only by writtendocument executed by the party entitled to the benefits of such terms orprovisions. No such waiver or consent shall be deemed to be or shall 

 

6

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constitute a waiver orconsent with respect to any other terms or provisions of this Agreement,whether or not similar. Each such waiver or consent shall be effective only inthe specific instance and for the purpose for which it was given, and shall notconstitute a continuing waiver or consent.

 

20.*          **DATAPRIVACY.*

 

Byentering into this Agreement, the Participant: (i) authorizes the Companyand each Affiliate, and any agent of the Company or any Affiliate administeringthe Plan or providing Plan recordkeeping services, to disclose to the Companyor any of its Affiliates such information and data as the Company or any suchAffiliate shall request in order to facilitate the grant of options and theadministration of the Plan; (ii) waives any data privacy rights he or shemay have with respect to such information; and (iii) authorizes theCompany and each Affiliate to store and transmit such information in electronicform.

 

[Remainder of Page Intentionally Left Blank]

 

7

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INWITNESS WHEREOF, the Company has caused this Agreement to be executed by itsduly authorized officer, and the Participant has hereunto set his or her hand,all as of the day and year first above written.

 
|   | ENERNOC, INC. |
|--------|--------------------|
|   |               |
|   | By:                |   |
|   |               | Name |
|   |               | Title |
|   |               |
|   |               |
|   | Participant        |

 

8

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**Exhibit A**

 

**NOTICE OF EXERCISE OF NON-QUALIFIEDSTOCK OPTION**

 

TO:  EnerNOC, Inc.

 

IMPORTANT NOTICE: This formof Notice of Exercise may only be used at such time as the Company has filed aRegistration Statement with the Securities and Exchange Commission under whichthe issuance of the Shares for which this exercise is being made is registeredand such Registration Statement remains effective.

 

Ladies and Gentlemen:

 

Ihereby exercise my Non-Qualified Stock Option to purchase                          shares (the “Shares”)of the common stock, $.001 par value, of EnerNOC, Inc. (the “Company”), atthe exercise price of $             pershare, pursuant to and subject to the terms of that certain Non-Qualified StockOption Agreement between the undersigned and the Company dated                       ,200            .

 

Iunderstand the nature of the investment I am making and the financial risksthereof. I am aware that it is my responsibility to have consulted withcompetent tax and legal advisors about the relevant national, state and localincome tax and securities laws affecting the exercise of the Option and thepurchase and subsequent sale of the Shares.

 

Iam paying the option exercise price for the Shares as follows:
|   |   |   |
|--------|--------|--------|

 

Pleaseissue the Shares (check one):

 

o to me; or

 

o to me and                                                , as joint tenants with right of survivorship,

 

atthe following address:

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 

A-1

----

 

Mymailing address for shareholder communications, if different from the addresslisted above, is:

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 
|   | Very truly yours,       |
|--------|-------------------------|
|   |                    |
|   |                    |
|   |                    |
|   | Participant (signature) |
|   |                    |
|   |                    |
|   | Print Name              |
|   |                    |
|   |                    |
|   | Date                    |
|   |                    |
|   |                    |
|   | Social Security Number  |

 

A-2

----

 

 

**RESTRICTED STOCK AGREEMENT**

 

**ENERNOC, INC.**

 

AGREEMENTmade as of the **                        ,20    ** (the “Grant Date”), between EnerNOC, Inc.(the “Company”), a Delaware corporation,and **                          **(the “Participant”).

 

WHEREAS,the Company has adopted the EnerNOC, Inc.Amended and Restated 2007 Employee, Director and Consultant Stock Plan (the“Plan”) to promote the interests of the Company by providing an incentive foremployees, directors and consultants of the Company or its Affiliates;

 

WHEREAS,pursuant to the provisions of the Plan, the Company desires to offer to theParticipant shares of the Company’s common stock, $.001 par value per share (“Common Stock”), in accordance with theprovisions of the Plan, all on the terms and conditions hereinafter set forth;

 

WHEREAS,Participant wishes to accept said offer; and

 

WHEREAS,the parties hereto understand and agree that any terms used and not definedherein have the meanings ascribed to such terms in the Plan.

 

NOW,THEREFORE, in consideration of the premises and the mutual covenants containedherein and for other good and valuable consideration, the receipt andsufficiency of which are hereby acknowledged, the parties hereto hereby agreeas follows:

 

1.                                       Terms of Grant.  The Participant hereby accepts the offer ofthe Company to issue to the Participant, in accordance with the terms of thePlan and this Agreement, **                  (      )** Shares of the Company’s Common Stock (such shares, subject toadjustment pursuant to Section 25****of the Plan and Subsection 2.1(h) hereof,the “Granted Shares”) at a purchase price of $.001 per share (the “Purchase Price”), receipt of which is herebyacknowledged by the Participant’s prior service to the Company and which amountwill be reported as income on the Participant’s W-2 for this calendar year.

 

2.1.                              ForfeitureProvisions.

 

(a)                                  LapsingForfeiture Right.  In theevent that for any reason the Participant is no longer an employee, director orconsultant of the Company or an Affiliate prior to                     (the“Termination”), the Participant (or the Participant’s Survivor) shall, on thedate of Termination, immediately forfeit to the Company (or its designee) allof the Granted Shares which have not yet lapsed in accordance with the scheduleset forth below (the “Lapsing Forfeiture Right”).

 

TheCompany’s Lapsing Forfeiture Right is as follows:

 

(i)                                     If the Participant’sTermination is prior to **[the first anniversary ofthe Grant Date],** all of the Granted Shares shall be forfeited to theCompany.

 

(ii)                                  If the Participant’sTermination is on or after **[the first anniversary ofthe Grant Date],** but prior to **                        **,    % of the Granted Shares shall be forfeited to theCompany (rounded up to the next highest whole number of shares), provided that           %of the Granted Shares shall no longer be subject to the LapsingForfeiture Right on the 1st of each quarter after **                  **and until **                    .**

 

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(b)                                 Effect ofTermination for Disability or upon Death.  The following rules apply if theParticipant’s Termination is by reason of Disability or death:  to the extent the Company’s LapsingForfeiture Right has not lapsed as of the date of Disability or death, as casemay be, the Participant shall forfeit to the Company any or all of the GrantedShares subject to such Lapsing Forfeiture Right; provided, however, that theCompany’s Lapsing Forfeiture Right shall be deemed to have lapsed to the extentof a pro rata portion of the Granted Shares through the date of Disability ordeath, as would have lapsed had the Participant not become Disabled or died, asthe case may be.  The proration shall bebased upon the number of days accrued in such current vesting period prior tothe Participant’s date of Disability or death, as the case may be.

 

(c)                                  Effect of a ForCause Termination.           Notwithstandinganything to the contrary contained in this Agreement, in the event the Companyor an Affiliate terminates the Participant’s employment or service for “cause”****(as defined in the Plan) or in the eventthe Administrator determines, within one year after the Participant’stermination, that either prior or subsequent to the Participant’s terminationthe Participant engaged in conduct that would constitute “cause,” all of theGranted Shares then held by the Participant shall be forfeited to the Companyimmediately as of the time the Participant is notified that he or she has beenterminated for “cause” or that he or she engaged in conduct which wouldconstitute “cause”.

 

**[Accelerated vesting on Change of Control to be determined on agrant-by-grant basis] [**(d)                                         Effect of Change of Control.  Except as otherwise provided in Subsection2.1(c) above, the Company’s Lapsing Forfeiture Right shall terminate, and the Participant’sownership of all Granted Shares then owned by the Participant shall becomevested in accordance with the terms and conditions set forth in Section 25(b) ofthe Plan.]

 

(e)                                  Escrow.  The certificates representing all GrantedShares acquired by the Participant hereunder which from time to time aresubject to the Lapsing Forfeiture Right shall be delivered to the Company andthe Company shall hold such Granted Shares in escrow as provided in thisSubsection 2.1(e). The Companyshall promptly release from escrow and deliver to the Participant a certificatefor the whole number of Granted Shares, if any, as to which the Company’sLapsing Forfeiture Right haslapsed. In the event of forfeiture to the Company of Granted Sharessubject to the Lapsing Forfeiture Right, the Company shall release from escrowand cancel a certificate for the number of Granted Shares so forfeited.  Any cash or securities distributed in respectof the Granted Shares held in escrow, including, without limitation, ordinarycash dividends or shares issued as a result of stock splits, stock dividends orother recapitalizations (“Retained Distributions”), shall also be held inescrow in the same manner as the Granted Shares and all Retained Distributions shall be forfeited to the Company orreleased from escrow and delivered to the Participant, as the case may be, atsuch time and in such manner as the Granted Shares to which such RetainedDistributions so relate. Allordinary cash dividends retained hereunder shall, during the period in whichsuch dividends are retained by the Company, be deposited into an account at afinancial institution selected by the Company, which shall not be required tobear interest or be segregated in a separate account.

 

(f)                                    Prohibition onTransfer.  TheParticipant recognizes and agrees that all Granted Shares and RetainedDistributions which are subject to the Lapsing Forfeiture Right may not besold, transferred, assigned, hypothecated, pledged, encumbered or otherwisedisposed of, whether voluntarily or by operation of law, other than to theCompany (or its designee). ** **However, the Participant, with the approval of the Administrator, maytransfer the Granted Shares and Retained Distributions for no consideration toor for the benefit of the Participant’s Immediate Family (including, withoutlimitation, to a trust for the benefit of the Participant’s Immediate Family orto a partnership or limited liability company for one or more members of theParticipant’s Immediate Family), subject to such limits as the Administratormay establish, and the transferee shall remain subject to all the terms andconditions applicable to this Agreement prior to such transfer and each suchtransferee shall so acknowledge in writing as a condition precedent to theeffectiveness of such transfer.  The term“Immediate Family” shall mean the Participant’s spouse, former spouse, parents,children, stepchildren, adoptive relationships, 

 

2

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sisters, brothers, nieces and nephews andgrandchildren (and, for this purpose, shall also include****the Participant.** **The Companyshall not be required to transfer any Granted Shares or Retained Distributionson its books which shall have been sold, assigned or otherwise transferred inviolation of this Subsection 2.1(f), or to treat as the owner of such GrantedShares or Retained Distributions, or to accord the right to vote as such owneror to pay dividends to, any person or organization to which any such GrantedShares or Retained Distributions shall have been so sold, assigned or otherwisetransferred, in violation of this Subsection 2.1(f).

 

(g)                                 Failure toDeliver Granted Shares to be Forfeited.  In the event that the Granted Shares to beforfeited to the Company under this Agreement are not in the Company’s possessionpursuant to Subsection 2.1(e) above or otherwise and the Participant orthe Participant’s Survivor fails to deliver such Granted Shares to the Company(or its designee), the Company may immediately take such action as isappropriate to transfer record title of such Granted Shares from theParticipant to the Company (or its designee) and treat the Participant and suchGranted Shares in all respects as if delivery of such Granted Shares had beenmade as required by this Agreement.  TheParticipant hereby irrevocably grants the Company a power of attorney whichshall be coupled with an interest for the purpose of effectuating the precedingsentence.

 

(h)                                 Adjustments.  The Plan contains provisions covering thetreatment of Shares in a number of contingencies such as stock splits andmergers.  Provisions in the Plan foradjustment with respect to the Granted Shares and the related provisions withrespect to successors to the business of the Company are hereby made applicablehereunder and are incorporated herein by reference.

 

2.2                                 GeneralRestrictions on Transfer of Granted Shares.

 

(a)                                  The Participantagrees that in the event the Company proposes to offer for sale to the publicany of its equity securities and such Participant is requested by the Companyand any underwriter engaged by the Company in connection with such offering tosign an agreement restricting the sale or other transfer of Shares, then itwill promptly sign such agreement and will not transfer, whether in privatelynegotiated transactions or to the public in open market transactions orotherwise, any Shares or other securities of the Company held by him or herduring such period as is determined by the Company and the underwriters, not toexceed 90 days following the closing of the offering, plus such additionalperiod of time as may be required to comply with Marketplace Rule 2711 ofthe National Association of Securities Dealers, Inc. or similar rules thereto(such period, the “Lock-Up Period”). Such agreement shall be in writing and in form and substance reasonablysatisfactory to the Company and such underwriter and pursuant to customary andprevailing terms and conditions. Notwithstanding whether the Participant has signed such an agreement,the Company may impose stop-transfer instructions with respect to the Shares orother securities of the Company subject to the foregoing restrictions until theend of the Lock-Up Period.

 

(b)                                 The Participantacknowledges and agrees that neither the Company nor, its shareholders nor itsdirectors and officers, has any duty or obligation to disclose to theParticipant any material information regarding the business of the Company oraffecting the value of the Shares before, at the time of, or following aTermination, including, without limitation, any information concerning plansfor the Company to make a public offering of its securities or to be acquiredby or merged with or into another firm or entity.

 

3.                                       Securities Law Compliance.  The Participant specifically acknowledges andagrees that any sales of Granted Shares shall be made in accordance with therequirements of the Securities Act of 1933, as amended.

 

3

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4.                                       Rights as aStockholder.  TheParticipant shall have all the rights of a stockholder with respect to theGranted Shares, including voting and dividend rights, subject to the transferand other restrictions set forth herein, including pursuant to Section 2.1(e) hereofand in the Plan.

 

5.                                       Legend.  In addition to any legend required pursuantto the Plan, all certificates representing the Granted Shares to be issued tothe Participant pursuant to this Agreement shall have endorsed thereon a legendsubstantially as follows:

 

“Theshares represented by this certificate are subject to restrictions set forth ina Restricted Stock Agreement dated as of                with this Company, a copy of which Agreement is available for inspection at theoffices of the Company or will be made available upon request.”

 

6.                                       Incorporationof the Plan.  TheParticipant specifically understands and agrees that the Granted Shares issuedunder the Plan are being sold to the Participant pursuant to the Plan, a copyof which Plan the Participant acknowledges he or she has read and understandsand by which Plan he or she agrees to be bound. The provisions of the Plan are incorporated herein by reference.

 

7.                                       Tax Liabilityof the Participant and Payment of Taxes. The Participantacknowledges and agrees that any income or other taxes due from the Participantwith respect to the Granted Shares issued pursuant to this Agreement,including, without limitation, the Lapsing Forfeiture Right, shall be theParticipant’s responsibility.  Withoutlimiting the foregoing, the Participant agrees that, to the extent that thelapsing of restrictions on disposition of any of the Granted Shares or thedeclaration of dividends on any such shares before the lapse of suchrestrictions on disposition results in the Participant’s being deemed to be inreceipt of earned income under the provisions of the Code, the Company shall beentitled to immediate payment from the Participant of the amount of any taxrequired to be withheld by the Company.

 

Uponexecution of this Agreement, the Participant may file an election under Section 83of the Code in substantially the form attached as Exhibit B.  The Participant acknowledges that if he doesnot file such an election, as the Granted Shares are released from the LapsingForfeiture Right in accordance with Section 2.1, the Participant will haveincome for tax purposes equal to the fair market value of the Granted Shares atsuch date, less the price paid for the Granted Shares by the Participant.  TheParticipant has been given the opportunity to obtain the advice of his or hertax advisors with respect to the tax consequences of the purchase of theGranted Shares and the provisions of this Agreement.

 

[If the Participant has notfiled an election under Section 83 of the Code, the Participant shall berequired to deposit with the Company an amount of cash equal to the amountdetermined by the Company to be required with respect to the statutory minimumof the Participant’s estimated total federal, state and local tax obligationsassociated with the termination of the Lapsing Forfeiture Right with respect tothe Granted Shares.  In connection withthe foregoing, the Participant agrees that the Company shall authorize aregistered broker(s) (the “Broker”) to sell on the date that the GrantedShares shall be released from the Lapsing Forfeiture Right such number of GrantedShares as the Company instructs the Broker to sell to satisfy the Company’swithholding obligations, after deduction of the Broker’s commission, and theBroker shall remit to the Company the cash necessary in order for the Companyto satisfy its withholding obligation. The Company shall not deliver any of the Granted Shares until thedeposit required herein for withholding has been made.  In connection with such sale of GrantedShares, the Participant shall execute any such documents requested by Broker inorder to effectuate the sale of the Granted Shares and payment of thewithholding obligation to the Company.]

 

8.                                       EquitableRelief.  The Participant specificallyacknowledges and agrees that in the event of a breach or threatened breach ofthe provisions of this Agreement or the Plan, including the attempted 

 

4

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transferof the Granted Shares by the Participant in violation of this Agreement,monetary damages may not be adequate to compensate the Company, and, therefore,in the event of such a breach or threatened breach, in addition to any right todamages, the Company shall be entitled to equitable relief in any court havingcompetent jurisdiction.  Nothing hereinshall be construed as prohibiting the Company from pursuing any other remediesavailable to it for any such breach or threatened breach.

 

9.                                       No Obligationto Maintain Relationship.  TheCompany is not by the Plan or this Agreement obligated to continue theParticipant as an employee, director or consultant of the Company or anAffiliate.  The Participantacknowledges:  (i) that the Plan isdiscretionary in nature and may be suspended or terminated by the Company atany time; (ii) that the grant of the Shares is a one-time benefit whichdoes not create any contractual or other right to receive future grants ofshares, or benefits in lieu of shares; (iii) that all determinations withrespect to any such future grants, including, but not limited to, the timeswhen shares shall be granted, the number of shares to be granted, the purchaseprice, and the time or times when each share shall be free from a lapsingrepurchase or forfeiture right, will be at the sole discretion of the Company;(iv) that the Participant’s participation in the Plan is voluntary; (v) thatthe value of the Shares is an extraordinary item of compensation which isoutside the scope of the Participant’s employment contract, if any; and (vi) thatthe Shares are not part of normal or expected compensation for purposes ofcalculating any severance, resignation, redundancy, end of service payments,bonuses, long-service awards, pension or retirement benefits or similarpayments.

 

10.                                 Notices.  Any notices required or permitted by theterms of this Agreement or the Plan shall be given by recognized courierservice, facsimile, registered or certified mail, return receipt requested,addressed as follows:

 
|   | If to the Company:  |                            |   |
|--------|---------------------|---------------------------------|--------|
|   |                | EnerNOC, Inc.                   |   |
|   |                | Attn: Chief Financial  Officer  |   |
|   |                | 101 Federal Street, Suite  1100 |   |
|   |                | Boston, MA  02110          |   |
|   |                |                            |   |
|   | If to the Employee: |                            |   |
|   |                |                            |   |
|   |                |                            |   |

 

orto such other address or addresses of which notice in the same manner haspreviously been given.  Any such noticeshall be deemed to have been given on the earliest of receipt, one business dayfollowing delivery by the sender to a recognized courier service, or threebusiness days following mailing by registered or certified mail.

 

11.                                 Benefit ofAgreement.  Subject tothe provisions of the Plan and the other provisions hereof, this Agreementshall be for the benefit of and shall be binding upon the heirs, executors,administrators, successors and assigns of the parties hereto.

 

12.                                 Governing Law.  This Agreement shall be construed andenforced in accordance with the laws of the State of Delaware**,**withoutgiving effect to the conflict of law principles thereof.  For the purpose of litigating any disputethat arises under this Agreement, whether at law or in equity, the partieshereby consent to exclusive jurisdiction in the Commonwealth of Massachusetts****andagree that such litigation shall be conducted in the courts of Suffolk County,Massachusetts or the federal courts of the United States for the District ofMassachusetts.

 

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13.                                 Severability.  If any provision of this Agreement is held tobe invalid or unenforceable by a court of competent jurisdiction, then suchprovision or provisions shall be modified to the extent necessary to make suchprovision valid and enforceable, and to the extent that this is impossible,then such provision shall be deemed to be excised from this Agreement, and thevalidity, legality and enforceability of the rest of this Agreement shall notbe affected thereby.

 

14.                                 EntireAgreement.  ThisAgreement, together with the Plan, constitutes the entire agreement andunderstanding between the parties hereto with respect to the subject matterhereof and supersedes all prior oral or written agreements and understandingsrelating to the subject matter hereof. No statement, representation, warranty, covenant or agreement notexpressly set forth in this Agreement shall affect or be used to interpret,change or restrict the express terms and provisions of this Agreement provided,however, in any event, this Agreement shall be subject to and governed by thePlan.

 

15.                                 Modificationsand Amendments; Waivers and Consents.  The terms and provisions of this Agreementmay be modified or amended as provided in the Plan.  Except as provided in the Plan, the terms andprovisions of this Agreement may be waived, or consent for the departuretherefrom granted, only by written document executed by the party entitled tothe benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute awaiver or consent with respect to any other terms or provisions of thisAgreement, whether or not similar.  Eachsuch waiver or consent shall be effective only in the specific instance and forthe purpose for which it was given, and shall not constitute a continuingwaiver or consent.

 

16.                                 Consent ofSpouse/Domestic Partner.  Ifthe Participant has a spouse or domestic partner as of the date of thisAgreement, the Participant’s spouse or domestic partner shall execute a Consentof Spouse/Domestic Partner in the form of Exhibit A hereto, effectiveas of the date hereof.  Such consentshall not be deemed to confer or convey to the spouse or domestic partner anyrights in the Granted Shares that do not otherwise exist by operation of law orthe agreement of the parties.  If theParticipant subsequent to the date hereof, marries, remarries or applies to theCompany for domestic partner benefits, the Participant shall, not later than 60days thereafter, obtain his or her new spouse/domestic partner’sacknowledgement of and consent to the existence and binding effect of allrestrictions contained in this Agreement by having such spouse/domestic partnerexecute and deliver a Consent of Spouse/Domestic Partner in the form of Exhibit A.

 

17.                                 Counterparts.  This Agreement may be executed in one or morecounterparts, and by different parties hereto on separate counterparts, each ofwhich shall be deemed an original, but all of which together shall constituteone and the same instrument.

 

18.                                 Data Privacy.  By entering into this Agreement, theParticipant:  (i) authorizes theCompany and each Affiliate, and any agent of the Company or any Affiliateadministering the Plan or providing Plan record keeping services, to discloseto the Company or any of its Affiliates such information and data as theCompany or any such Affiliate shall request in order to facilitate the grant ofShares and the administration of the Plan; (ii) waives any data privacyrights he or she may have with respect to such information; and (iii) authorizesthe Company and each Affiliate to store and transmit such information inelectronic form.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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INWITNESS WHEREOF, the parties hereto have executed this Agreement as of the dayand year first above written.

 
|   | ENERNOC, INC. |
|--------|--------------------|
|   |               |
|   |               |
|   | By:                |   |
|   | Name:              |
|   | Title:             |
|   |               |
|   |               |
|   | **Participant:**   |
|   |               |
|   |               |
|   | By:                |   |
|   |               |
|   | Print Name:        |

 

7

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EXHIBIT A

 

CONSENT OF SPOUSE/DOMESTIC PARTNER

 

I,                                                        ,spouse or domestic partner of                                                  ,acknowledge that I have read the RESTRICTED STOCK AGREEMENT dated as of                              (the “Agreement”) to which this Consent is attached as Exhibit A and thatI know its contents.  Capitalized termsused and not defined herein shall have the meanings assigned to such terms inthe Agreement.  I am aware that by itsprovisions the Granted Shares granted to my spouse/domestic partner pursuant tothe Agreement are subject to a Lapsing Forfeiture Right in favor of EnerNOC, Inc. (the “Company”) andthat, accordingly, I may be required to forfeit to the Company any or allof the Granted Shares of which I may become possessed as a result of a giftfrom my spouse/domestic partner or a court decree and/or any propertysettlement in any domestic litigation.

 

Ihereby agree that my interest, if any, in the Granted Shares subject to theAgreement shall be irrevocably bound by the Agreement and further understand andagree that any community property interest I may have in the Granted Sharesshall be similarly bound by the Agreement.

 

Iagree to the Lapsing Forfeiture Right described in the Agreement and I herebyconsent to the forfeiture of the Granted Shares to the Company by myspouse/domestic partner or my spouse/domestic partner’s legal representative inaccordance with the provisions of the Agreement.  Further, as part of the consideration for theAgreement, I agree that at my death, if I have not disposed of anyinterest of mine in the Granted Shares by an outright bequest of the GrantedShares to my spouse or domestic partner, then the Company shall have the samerights against my legal representative to exercise its rights to the GrantedShares with respect to any interest of mine in the Granted Shares as it wouldhave had pursuant to the Agreement if I had acquired the Granted Sharespursuant to a court decree in domestic litigation.

 

**I AM AWARE THAT THE LEGAL, FINANCIAL AND RELATED MATTERS CONTAINED INTHE AGREEMENT ARE COMPLEX AND THAT I AM FREE TO SEEK INDEPENDENT PROFESSIONALGUIDANCE OR COUNSEL WITH RESPECT TO THIS CONSENT.  I HAVE EITHER SOUGHT SUCH GUIDANCE OR COUNSELOR DETERMINED AFTER REVIEWING THE AGREEMENT CAREFULLY THAT I WILL WAIVE SUCHRIGHT.**

 

Datedas of the              day of                                ,20    .

 

 
|   |         |
|--------|--------------|
|   | Print  name: |

 

A-1

----

 

EXHIBIT B

 

**Election to Include Gross Incomein Year**

**of Transfer Pursuant to Section 83(b)**

**of the Internal Revenue Code of1986, as amended**

 

Inaccordance with Section 83(b) of the Internal Revenue Code of 1986,as amended (the “Code”), the undersigned hereby elects to include in his grossincome as compensation for services the excess, if any, of the fair marketvalue of the property (described below) at the time of transfer over the amountpaid for such property.

 

Thefollowing sets for the information required in accordance with the Code and theregulations promulgated hereunder:

 

1.                                       The name,address and social security number of the undersigned are:

 

Name:

Address:

Social Security No.:

 

2.                                       The descriptionof the property with respect to which the election is being made is as follows:

 

                     (      )shares (the “Shares”) of Common Stock, $.001 par value per share, of EnerNOC, Inc., a Delawarecorporation (the “Company”).

 

3.                                       This electionis made for the calendar year         ,with respect to the transfer of the property to the Taxpayer on                                  .

 

4.                                       Description ofrestrictions:  The property is subject tothe following restrictions:

 

In the event taxpayer’s employment with the Company or an Affiliate isterminated, the taxpayer shall forfeit the Shares as set forth below:

 

A.                                   If thetermination takes place on or prior to                        all of the Shares will be forfeited.

 

B.                                     If thetermination takes place after                    ,200  , the number of Shares forfeited shall be                            (      ) Shares less                                        (      ) Shares for each full twelve (12) monthperiod elapsed after                           ,200   if the taxpayer is employed by the Company or an Affiliate.

 

5.                                       The fair marketvalue at time of transfer (determined without regard to any restrictions otherthan restrictions which by their terms will never lapse) of the property withrespect to which this election is being made was not more than$         per Share.

 

6.                                       The amount paidby taxpayer for said property was $       per Share.

 

7.                                       A copy of thisstatement has been furnished to the Company.

 

Signedthis          day of            , 200  .

 

 
|   |         |
|--------|--------------|
|   | Print  Name: |

 

B-1

----

 

 

**RESTRICTEDSTOCK UNIT AGREEMENT**

** **

**ENERNOC,INC.**

** **

This Restricted StockUnit Agreement is made as of the              ****day of                                      ,20     (the “Grant Date”), by and between EnerNOC, Inc.,a Delaware corporation havingits principal place of business at 101 Federal Street, Suite 1100, Boston,Massachusetts 02110 (the “Company”), and **                                                **(the “Participant”).

 

WHEREAS, the Company hasadopted the Amended and Restated 2007 Employee, Director and Consultant StockPlan (the “Plan”) to promote the interests of the Company by providing anincentive for employees, directors and consultants of the Company or itsAffiliates;

 

WHEREAS, pursuant to theprovisions of the Plan, the Company desires to grant to the Participantrestricted stock units (“RSUs”) related to the Company’s common stock, $.001 par value per share (“CommonStock”), in accordance with the provisions of the Plan, all on the terms andconditions hereinafter set forth;

 

WHEREAS, the Company andthe Participant understand and agree that any terms used and not defined hereinhave the meanings ascribed to such terms in the Plan.

 

NOW, THEREFORE, in consideration of the premises and the mutualcovenants contained herein and for other good and valuable consideration, thereceipt and sufficiency of which are hereby acknowledged, the parties heretohereby agree as follows:

 

1.             Grant of Award. The Company hereby grants to the Participant an aggregate of                      RSUs (the “Award”) which represents a contingent entitlement of the Participantto receive shares of Common Stock, on the terms and conditions and subject toall the limitations set forth herein and in the Plan, which is incorporatedherein by reference.  The Participantacknowledges receipt of a copy of the Plan.

 

2.             Vesting of Award.

 

Subjectto the terms and conditions set forth in this Agreement and the Plan, the Awardgranted hereby shall vest as follows provided that the Participant remainscontinuously employed by the Company or an Affiliate through the applicablevesting date:

 
| **Number of RSUs**                                                                                                          | ** ** | **Vesting  Date**                                                                                                                                                      |
|-----------------------------------------------------------------------------------------------------------------------------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                        |       |                                                                                                                                                                   |
| 25%  of the RSUs                                                                                                            |       | On  the first anniversary of the Grant Date                                                                                                                            |
|                                                                                                                        |       |                                                                                                                                                                   |
| An additional           % of the RSUs rounded  down to the nearest whole share |       | On  the first day of each              following  the first anniversary of the Grant Date of this Agreement for |

 

**[Accelerated vesting on Change of Control to be determined on agrant-by-grant basis.] **[Notwithstandingthe foregoing, in the event of a Change of Control (as defined below),    % of the RSUs which would have vested in each vestinginstallment remaining under this Award will be vested for purposes of Section 24(b) ofthe Plan unless this Award has otherwise expired or been terminated pursuant toits terms or the terms of the Plan.

 

----

 

Change of Control means the occurrence of any of the following events:

 

(i)                                     Ownership.  Any “Person” (as such term is used inSections 13(d) and 14(d) of the Securities Exchange Act of 1934, asamended) becomes the “Beneficial Owner” (as defined in Rule 13d-3 undersaid Act), directly or indirectly, of securities of the Company representing50% or more of the total voting power represented by the Company’s thenoutstanding voting securities (excluding for this purpose the Company or itsAffiliates or any employee benefit plan of the Company) pursuant to atransaction or a series of related transactions which the Board of Directorsdoes not approve; or

 

(ii)                                  Merger/Sale of Assets.  A merger or consolidation of the Companywhether or not approved by the Board of Directors, other than a merger orconsolidation which would result in the voting securities of the Companyoutstanding immediately prior thereto continuing to represent (either byremaining outstanding or by being converted into voting securities of thesurviving entity or the parent of such corporation) at least 50% of the totalvoting power represented by the voting securities of the Company or suchsurviving entity or parent of such corporation outstanding immediatelyafter such merger or consolidation, or the stockholders of the Company approvean agreement for the sale or disposition by the Company of all or substantiallyall of the Company’s assets; or

 

(iii)                               Change in BoardComposition.  A change in the compositionof the Board of Directors, as a result of which fewer than a majority of thedirectors are Incumbent Directors. “Incumbent Directors” shall mean directors who either (A) aredirectors of the Company as of [insert grant date], or (B) are elected, or nominated forelection, to the Board of Directors with the affirmative votes of at leasta majority of the Incumbent Directors at the time of such election ornomination (but shall not include an individual whose election or nomination isin connection with an actual or threatened proxy contest relating to theelection of directors to the Company).]

 

Onthe vesting date set forth above, the Participant shall be entitled to receivesuch number of shares of Common Stock equivalent to the number of RSUs set forthopposite such vesting date provided that the Participant is employed by theCompany or an Affiliate on such vesting date. Such shares of Common Stock shall thereafter be delivered by the Companyto the Participant in accordance with this Agreement and the Plan and asrequired to comply with Section 409A of the Code.  Notwithstanding the foregoing, if theParticipant is as of the vesting date a“specified employee” (as defined under Section 409A of the Code) then suchpayment of shares of Common Stock, if required by Section 409A of theCode, will be made six months after the date of such Separation from Service(as defined in Section 409A of the Code).

 

Except as otherwise setforth in this Agreement, if the Participant ceases to be employed for any reasonby the Company or an Affiliate prior to a vesting date, then as of the date onwhich the Participant’s employment terminates, all unvested RSUs subject tothis Award shall immediately be forfeited to the Company and this Agreementshall terminate and be of no further force or effect.

 

3.             Prohibitions on Transfer and Sale.

 

ThisAward (including any additional RSUs received by the Participant as a result ofstock dividends, stock splits or any other similar transaction affecting theCompany’s securities without

 

2

----

 

receipt of consideration) shall not be transferable by the Participantotherwise than by will or by the laws of descent and distribution or pursuantto a qualified domestic relations order as defined by the Code or Title I ofthe Employee Retirement Income Security Act or the rules thereunder.  Except as provided in the previous sentence,the shares of Common Stock to be issued pursuant to this Agreement shall beissued, during the Participant’s lifetime, only to the Participant (or, in theevent of legal incapacity or incompetence, to the Participant’s guardian orrepresentative). This Award shall not be assigned, pledged or hypothecated inany way (whether by operation of law or otherwise) and shall not be subject toexecution, attachment or similar process. Any attempted transfer, assignment, pledge, hypothecation or otherdisposition of this Award or of any rights granted hereunder contrary to theprovisions of this Section 3, or the levy of any attachment or similarprocess upon this Award shall be null and void.

 

4.             Adjustments. The Plan contains provisions covering the treatment of RSUs and sharesof Common Stock in a number of contingencies such as stock splits andmergers.  Provisions in the Plan foradjustment with respect to this Award and the related provisions with respectto successors to the business of the Company are hereby made applicablehereunder and are incorporated herein by reference.

 

5.             Securities Law Compliance.  The Participant specifically acknowledges andagrees that any sales of shares of Common Stock issued hereunder shall be soldin accordance with the requirements of the Securities Act of 1933, as amended.

 

6.             Rights as a Stockholder.  The Participant shall have no right as astockholder, including voting and dividend rights, with respect to the RSUssubject to this Agreement.

 

7.             Tax Liability of the Participant and Payment of Taxes.

 

The Participantacknowledges and agrees that any income or other taxes due from the Participantwith respect to this Award or the shares of Common Stock to be issued pursuantto this Agreement or otherwise sold shall be the Participant’sresponsibility.  Without limiting theforegoing, the Participant agrees that the Participant will owe taxes at eachvesting date on the portion of the Award then vested and the Company shall beentitled to immediate payment from the Participant of the amount of any taxrequired to be withheld by the Company.  In connectionwith the foregoing, the Participant agrees that if an arrangement to pay thewithholding obligation in cash has not been received by the Company prior to avesting date, the Company shall authorize a registered broker (the “Broker”) tosell on such vesting date such number of shares of Common Stock otherwisedeliverable to the Participant on vesting of the Award as the Company instructsthe Broker to sell to satisfy the Company’s withholding obligation, afterdeduction of the Broker’s commission, and the Broker shall remit to the Companythe cash necessary in order for the Company to satisfy its withholdingobligation.  In connection with such saleof shares of Common Stock, the Participant shall execute any such documentsrequested by Broker in order to effectuate the sale of the shares of CommonStock and payment of the withholding obligation to the Company. The Company shall not deliver any shares of Common Stock to theParticipant until all withholdings have been made.

 

8.             Participant Acknowledgements and Authorizations.

 

The Participantacknowledges the following:

 

(a)           The Company is not by the Plan orthis Award obligated to continue the Participant as an employee, director orconsultant of the Company or an Affiliate.

 

(b)           The Plan is discretionary in natureand may be suspended or terminated by the Company at any time.

 

3

----

 

(c)           The grant of this Award is considereda one-time benefit and does not create a contractual or other right to receiveany other award under the Plan, benefits in lieu of awards or any otherbenefits in the future.

 

(d) The Plan is avoluntary program of the Company and future awards, if any, will be at the solediscretion of the Company, including, but not limited to, the timing of anygrant, the amount of any award, vesting provisions and purchase price, if any.

 

(e)           The value of this Award is anextraordinary item of compensation outside of the scope of any employment.  As such the Award is not part of normal orexpected compensation for purposes of calculating any severance, resignation,redundancy, end of service payments, bonuses, long-service awards, pension orretirement benefits or similar payments. The future value of the shares of Common Stock is unknown and cannot bepredicted with certainty.

 

(f)            The Participant authorizes his orher employer to furnish the Company (and any agent administering the Plan orproviding recordkeeping services) with such information and data as it shallrequest in order to facilitate the grant of the Award and the administration ofthe Plan, and the Participant waives any data privacy rights he or she may havewith respect to such information or the sharing of such information.

 

9.             Notices. Any notices required or permitted by the terms of this Agreement or thePlan shall be given by recognized courier service, facsimile, registered orcertified mail, return receipt requested, addressed as follows:

 

If tothe Company at the principal business office listed on the first page ofthis Agreement.

 

Ifto the Participant at the address set forth in the Company’s employmentdirectory, or to such other address or addresses of which notice in the samemanner has previously been given.  Anysuch notice shall be deemed to have been given on the earliest of receipt, onebusiness day following delivery by the sender to a recognized courier service,or three business days following mailing by registered or certified mail.

 

10.           Benefit of Agreement.  Subject to the provisions of the Plan and theother provisions hereof, this Agreement shall be for the benefit of and shallbe binding upon the heirs, executors, administrators, successors and assigns ofthe parties hereto.

 

11.           Governing Law.  This Agreement shall be construed andenforced in accordance with the laws of the State of Delaware**,**withoutgiving effect to the conflict of law principles thereof.  For the purpose of litigating any disputethat arises under this Agreement, whether at law or in equity, the partieshereby consent to exclusive jurisdiction in the Commonwealth of Massachusetts****andagree that such litigation shall be conducted in the courts of Suffolk County,Massachusetts or the federal courts of the United States for the District ofMassachusetts.

 

12.           Severability.  If any provision of this Agreement is held tobe invalid or unenforceable by a court of competent jurisdiction, then suchprovision or provisions shall be modified to the extent necessary to make suchprovision valid and enforceable, and to the extent that this is impossible,then such provision shall be deemed to be excised from this Agreement, and thevalidity, legality and enforceability of the rest of this Agreement shall notbe affected thereby.

 

13.           Entire Agreement.  This Agreement, together with the Plan,constitutes the entire agreement and understanding between the parties heretowith respect to the subject matter hereof and supersedes all prior oral orwritten agreements and understandings relating to the subject matterhereof.  

 

4

----

 

No statement, representation, warranty, covenant or agreement notexpressly set forth in this Agreement shall affect or be used to interpret,change or restrict the express terms and provisions of this Agreement provided,however, in any event, this Agreement shall be subject to and governed by thePlan.

 

14.           Modifications and Amendments;Waivers and Consents.  The terms andprovisions of this Agreement may be modified or amended as provided in thePlan.  Except as provided in the Plan,the terms and provisions of this Agreement may be waived, or consent for thedeparture therefrom granted, only by written document executed by the partyentitled to the benefits of such terms or provisions.  No such waiver or consent shall be deemed tobe or shall constitute a waiver or consent with respect to any other terms orprovisions of this Agreement, whether or not similar.  Each such waiver or consent shall beeffective only in the specific instance and for the purpose for which it wasgiven, and shall not constitute a continuing waiver or consent.

 

15.           Counterparts.  This Agreement may be executed in one or morecounterparts, and by different parties hereto on separate counterparts, each ofwhich shall be deemed an original, but all of which together shall constituteone and the same instrument.

 

 [THE NEXT PAGE IS THE SIGNATURE PAGE]

 

5

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IN WITNESS WHEREOF, theparties hereto have executed this Restricted Stock Unit Agreement as of the dayand year first above written.

 
|   | **ENERNOC,  INC.** |
|--------|--------------------|
|   | ** **         |
|   | ** **         |
|   | By:                |   |
|   | Name:              |
|   | Title:             |
|   |               |
|   |               |
|   | Participant:       |
|   |               |
|   |               |
|   |               |
|   | Print Name:        |

 

6

----

 

 

**ENERNOC, INC.**

**EMPLOYEE, DIRECTOR ANDCONSULTANT STOCK PLAN**

 

**HMRC APPROVED SUB PLAN FOR UKEMPLOYEES**

**(“THE UK SUB-PLAN”)**

 

 

Adopted by the Board of Directors on: 2 June 2010

Approved by HMRC on: 16 September 2010

HMRC reference no: X 105704

 

 

 

AlderCastle

10Noble Street

LondonEC2V 7QJ

Tel:+44 (0)20 7645 2400

Fax: +44 (0)20 7645 2424

 

----

 

**ENERNOC, INC.**

**2007 EMPLOYEE, DIRECTOR ANDCONSULTANT STOCK PLAN**

**HMRC APPROVED SUB-PLAN FOR UKEMPLOYEES**

**(“‘THE UK SUB-PLAN”)**

 

1.             **GENERAL**

 

Thissupplement to the EnerNOC, Inc. Amended and Restated 2007 Employee,Director and Consultant Stock Plan (“the Plan”) sets out the HMRC Sub-Plan forUK Employees (“the UK Sub-Plan”).

 

2.             **ESTABLISHMENT OF UK SUB-PLAN**

 

EnerNOCInc. (“the Company”) has established the UK Sub-Plan under Paragraph 4(g) ofthe Plan, which authorises the Administrator to establish sub-plans to thePlan.

 

3.             **PURPOSE OF UK SUB-PLAN**

 

Thepurpose of the UK Sub-Plan is to enable the grant to, and subsequent exerciseby, employees and directors in the United Kingdom, on a tax favoured basis, ofoptions to acquire shares in the Company under the Plan.

 

4.             **HMRC APPROVAL OF UK SUB-PLAN**

 

TheUK Sub-Plan is intended to be approved by HMRC under Schedule 4 to ITEPA 2003.

 

5.             **RULES OF UK SUB-PLAN**

 

The rules ofthe Plan, in their present form and as amended from time to time, shall, withthe modifications set out in this supplement, form the rules of theUK Sub-Plan. In the event of any conflict between the rules of thePlan and this supplement, the supplement shall prevail.

 

6.             **RELATIONSHIP OF UK SUB-PLAN TOPLAN**

 

TheUK Sub-Plan shall form part of the Plan and not a separate and independentplan.

 

7.             **INTERPRETATION**

 

Inthe UK Sub-Plan, unless the context otherwise requires, the following words andexpressions have the following meanings:

 
| **Acquiring Company** |   | a  company which obtains Control of the Company in the circumstances referred to  in rule 26; |
|-----------------------|--------|----------------------------------------------------------------------------------------------------|
|                  |   |                                                                                               |
| **Approval Date**     |   | the  date on which the UK Sub-Plan is approved by HMRC under Schedule 4;                           |

 

1

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| **Associate**            |   | the meaning given to that expression by paragraph  12 of Schedule 4;                                                                                                                |
|--------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                     |   |                                                                                                                                                                                |
| **Associated Company**   |   | the  meaning given to that expression by paragraph 35 of Schedule 4;                                                                                                                |
|                     |   |                                                                                                                                                                                |
| **Constituent  Company** |   | any  of the following:                                                                                                                                                              |
|                     |   |                                                                                                                                                                                |
|                     |   | (a)   the Company; and                                                                                                                                                    |
|                     |   |                                                                                                                                                                                |
|                     |   | (b)   any Eligible Company nominated by the Administrator to be a  Constituent Company at the relevant time.                                                              |
|                     |   |                                                                                                                                                                                |
| **Control**              |   | the  meaning given to that word by Section 719 of ITEPA 2003 and “Controlled”  shall be construed accordingly;                                                       |
|                     |   |                                                                                                                                                                                |
| **Date of Grant**        |   | the  date on which the Administrator determines to grant an Option to an Eligible  Employee;                                                                                        |
|                     |   |                                                                                                                                                                                |
| **Eligible Company**     |   | any company of which the Company has Control,  including any jointly owned company (as defined in paragraph 34 of Schedule  4):                                                     |
|                     |   |                                                                                                                                                                                |
|                     |   | (a)   which is treated as being under the Company’s  Control under paragraph 34 of Schedule 4; and                                                                   |
|                     |   |                                                                                                                                                                                |
|                     |   | (b)   which is not excluded from being a Constituent  Company under paragraph 34(4) of Schedule 4;                                                                   |
|                     |   |                                                                                                                                                                                |
| **Eligible Employee**    |   | any Employee who:                                                                                                                                                                   |
|                     |   |                                                                                                                                                                                |
|                     |   | (a)   does not have a Material Interest (either on his own  or together with one or more of his Associates), and has not had such an  interest in the last 12 months; and |
|                     |   |                                                                                                                                                                                |
|                     |   | (b)   has no Associate or Associates which has or (taken  together) have a Material Interest, or had such an interest in the last 12  months; and                         |
|                     |   |                                                                                                                                                                                |
|                     |   | (c)   is either:                                                                                                                                                          |
|                     |   |                                                                                                                                                                                |
|                     |   | (i)    not a director of any Constituent Company; or                                                                                                                 |
|                     |   |                                                                                                                                                                                |
|                     |   | (ii)   a director of a Constituent Company who is required  to devote at least 25 hours per week (excluding meal breaks) to his duties;                                   |

 

2

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| **Employee**          |   | an employee of a Constituent Company;                                                                                                                                                                                                                                                                                                                                                      |
|-----------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **HMRC**              |   | Her Majesty’s Revenue and Customs;                                                                                                                                                                                                                                                                                                                                                    |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **ICTA 1988**         |   | The  Income and Corporation Taxes Act 1988;                                                                                                                                                                                                                                                                                                                                                |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **ITEPA 2003**        |   | The Income Tax (Earnings and Pensions) Act 2003;                                                                                                                                                                                                                                                                                                                                           |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **Key Feature**       |   | any provision of the UK Sub-Plan which is  necessary to meet the requirements of Schedule 4;                                                                                                                                                                                                                                                                                               |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **Market Value**      |   | (a)   in the case of an Option granted under the UK Sub-Plan:                                                                                                                                                                                                                                                                                                                    |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
|                  |   | (i)    if at the relevant time the Shares are listed on the London or New  York Stock Exchange the mean between the highest and lowest reported sale  prices of a Share on the London or New York Stock Exchange, as reported in  the Financial Times or Wall Street Journal respectively, for the Date of  Grant;                                                          |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
|                  |   | (ii)   if paragraph (i) does not apply, the market value of a Share as  determined in accordance with Part V111 of the Taxation of Chargeable  Gains Act 1992 and agreed in advance with HMRC Shares and Assets Valuation on  the Date of Grant of the Option or such earlier date or dates as may be  agreed in advance with the Shares and Assets Valuation of HMRC; |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
|                  |   | (b)   in the case of an option granted under any other share option scheme,  the market value of an ordinary share in the capital of the Company  determined under the rules of such scheme for the purpose of the grant  of the option;                                                                                                                                    |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **Material Interest** |   | the meaning given to that expression by paragraph  9 of Schedule 4;                                                                                                                                                                                                                                                                                                                   |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **New Option**        |   | an  option granted by way of exchange under rule 26.1;                                                                                                                                                                                                                                                                                                                                |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **New Shares**        |   | the  shares subject to a New Option referred to in rule 26. l;                                                                                                                                                                                                                                                                                                                        |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **Option**            |   | a  subsisting right to acquire Shares granted under the UK Sub-Plan;                                                                                                                                                                                                                                                                                                                       |
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                       |
| **Optionee**          |   | an  individual who holds an Option or, where the context permits, his legal  personal representatives;                                                                                                                                                                                                                                                                                     |

 

3

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| **Option Agreement**       |   | a  written agreement between the Company and Optionee evidencing the terms of an  individual Option grant, subject to the terms and conditions of the UK  Sub-Plan;                                                                                                                                                                                                     |
|----------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| **Ordinary Share Capital** |   | the  meaning given to that expression by paragraph 16 of Schedule 4;                                                                                                                                                                                                                                                                                                    |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| **Schedule 4**             |   | Schedule  4 to ITEPA 2003;                                                                                                                                                                                                                                                                                                                                              |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| **Share**                  |   | Common  Stock of the Company, par value $.001 per share;                                                                                                                                                                                                                                                                                                                |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| **Taxable Event**          |   | the exercise of an Option which may give rise to  liabilities for income tax and national insurance contributions (or their  equivalents in any other jurisdiction);                                                                                                                                                                                                    |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| **Tax Liability**          |   | the pounds sterling total of:                                                                                                                                                                                                                                                                                                                                           |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
| ** **                 |   | (a)   any PAYE income tax and primary class 1 (employee) national insurance  contributions (or any similar liability to withhold amounts in respect of  income tax or social security contribution in any jurisdiction) that the  Company or any employer (or former employer) of an Optionee is liable to  account for as a result of any Taxable Event; and |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
|                       |   | (b)   if:                                                                                                                                                                                                                                                                                                                                                     |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
|                       |   | (i)    such amounts may be lawfully recovered from the relevant Optionee; and                                                                                                                                                                                                                                                                            |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
|                       |   | (ii)   the relevant Option includes the requirement specified in  rule 22.3,                                                                                                                                                                                                                                                                             |
|                       |   |                                                                                                                                                                                                                                                                                                                                                                    |
|                       |   | any secondary class 1 (employer) national insurance  contributions (or any similar liability for social security contribution in  any jurisdiction) that the Company or any employer (or former employer) of an  Optionee is liable to pay as a result of any Taxable Event.                                                                                            |

 

Inthis supplement, unless the context otherwise requires:

 

(a)           words and expressions not defined above have the same meanings as aregiven to them in the Plan;

 

4

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(b)           the rule headings are inserted for ease of reference only and donot affect their interpretation;

 

(c)           a reference to a rule is a reference to a rule in thissupplement;

 

(d)           the singular includes the plural and vice-versa and the masculineincludes the feminine; and

 

(e)           a reference to a statutory provision is a reference to a United Kingdomstatutory provision and includes any statutory modification, amendment orre-enactment thereof.

 

8.             **COMPANIES PARTICIPATING IN UKSUB-PLAN**

 

Thecompanies participating in the UK Sub-Plan shall be each a Constituent Company.

 

9.             **SHARES USED IN UK SUB-PLAN**

 

TheShares shall form part of the Ordinary Share Capital of the Company whichsatisfy the conditions specified in paragraphs 16-20 inclusive of Schedule 4.

 

10.           **GRANT OF OPTIONS**

 

Anoption granted under the UK Sub-Plan shall be granted under and subject to the rules ofthe Plan as modified by this supplement.

 

11.           **IDENTIFICATION OF OPTIONS**

 

AnOption Agreement issued in respect of an Option shall expressly state that itis issued in respect of an Option. An option which is not so identified shallnot constitute an Option.

 

12.           **CONTENTS OF OPTION AGREEMENT**

 

AnOption Agreement issued in respect of an Option shall state:

 

(a)           that it is issued in respect of an Option;

 

(b)           the date of grant of the Option;

 

(c)           the number of Shares subject to the Option;

 

(d)           the exercise price under the Option;

 

(e)           any performance target or other condition imposed on the exercise of theOption;

 

(f)            the date(s) on which the Option will ordinarily become exercisable;and

 

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(g)           the period during which an Option shall remain exercisable followingtermination of employment.

 

13.           **EARLIEST DATE FOR GRANT OFOPTIONS**

 

AnOption may not be granted earlier than the Approval Date.

 

14.           **PERSONS TO WHOM OPTIONS MAY BEGRANTED**

 

AnOption may not be granted to an individual who is not an Eligible Employee atthe Date of Grant.

 

Forthe avoidance of doubt and notwithstanding Paragraph 5 of the Plan, an Optionmay not be granted under the UK Sub-Plan to a consultant or advisor.

 

Ifan Eligible Employee’s status changes to that of consultant or advisor, thisshall be regarded as a termination of employment for the purposes of the UKSub-Plan.

 

15.           **OPTIONS NON TRANSFERABLE**

 

AnOption shall be personal to the Eligible Employee to whom it is granted and,subject to rule 25, shall not be capable of being transferred, charged orotherwise alienated and shall lapse immediately if the Optionee purports totransfer, charge or otherwise alienate the Option.

 

Paragraph12 of the Plan shall be construed accordingly.

 

16.           **LIMIT ON NUMBER OF SHARES PLACEDUNDER OPTION UNDER UK SUB-PLAN**

 

Forthe avoidance of doubt, Shares placed under Option under the UK Sub-Plan shallbe taken into account for the purpose of Paragraph 3(a) of the Plan.

 

17.           **HMRC LIMIT (£30,000)**

 

17.1         Notwithstanding Paragraph 6a. of the Plan, an Optionmay not be granted to an Eligible Employee if the result of granting the Optionwould be that the aggregate Market Value of the shares subject to alloutstanding options granted to him under the UK Sub-Plan or any other shareoption scheme established by the Company or an Associated Company and approvedby the HMRC under Schedule 4 would exceed sterling £30,000 or such other limitas may from time to time be specified in paragraph 6 of Schedule 4. For thispurpose, the United Kingdom sterling equivalent of the market value of a shareon any day shall be determined by taking the spot sterling/dollar exchange ratefor that day as shown in the Financial Times.

 

17.2         If the grant of an Option would otherwise cause thelimit in rule 17.1 to be exceeded, it shall take effect as the grant of anOption under the UK Sub-Plan over the highest number of Shares which does notcause the limit to be exceeded.

 

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18.           **EXERCISE PRICE UNDER OPTIONS**

 

NotwithstandingParagraph 6(a)(i) of the Plan, the amount payable per Share on theexercise of an Option shall not be less than the Market Value of a Share on theDate of Grant and shall be stated on the Date of Grant.

 

19.           **PERFORMANCE TARGET OR OTHERCONDITION IMPOSED ON EXERCISE OF****OPTION**

 

19.1         Anyperformance target or other condition imposed on the exercise of an Optionunder Paragraph 4d. of the Plan shall be:

 

(a)           objective;

 

(b)           such that, once satisfied, the exercise of the Optionis not subject to the discretion of any person; and

 

(c)           stated on the Date of Grant.

 

19.2         Ifan event occurs as a result of which the Administrator considers that aperformance target or other condition imposed on the exercise of an Option isno longer appropriate and amends or modifies under Paragraph 4e. of the Planthe performance target or condition, such amendment or modification shall:

 

(a)           be fair and reasonable in the circumstances; and

 

(b)           produce a measure of performance that is no moredifficult to satisfy than the original.

 

20.           **EXERCISE OF OPTIONS BY LEAVERS**

 

Theperiod during which an Option shall remain exercisable following termination ofemployment, shall be stated at grant in the Option Agreement, which period maynot thereafter be altered.

 

21.           **LATEST DATE FOR EXERCISE OFOPTIONS**

 

Theperiod during which an Option shall remain exercisable shall be stated in theOption Agreement and any Option not exercised by that time shall lapseimmediately.

 

22.           **TAX LIABILITIES**

 

22.1         The definitions in this rule 22.1 apply in this rule 22.

 

**EmployerNICs**: Secondary class 1(employer) national insurance contributions (or any similar liability forsocial security contribution in any jurisdiction) which are included in any TaxLiability (or which would be included in any Tax Liability if an election ofthe type referred to in rule 22.3(b) had not been made) and which maybe lawfully recovered from the Optionee.

 

**SufficientShares**: the smallest number ofShares which, when sold following the exercise of an Option, will produce anamount in pounds sterling at least equal to the 

 

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relevantTax Liability (after deduction of brokerage and any other charges or taxes onthe sale).

 

22.2         Each Option shall include a requirement that theOptionee irrevocably agrees to:

 

(a)           pay to the Company, his employer or former employer(as appropriate) the amount of any Tax Liability; or

 

(b)           enter into arrangements to the satisfaction of theCompany, his employer or former employer (as appropriate) for payment of anyTax Liability.

 

22.3         Unless the Constituent Company which employs therelevant Eligible Employee directs that it shall not, each Option shall includea requirement that the Optionee agrees that:

 

(a)           the Company, his employer or former employer (asappropriate) may recover the whole or any part of any Employer NICs from theOptionee; or

 

(b)           at the request of the Company, his employer or formeremployer, the Optionee shall elect (using a form approved by HMRC) that thewhole or any part of the liability for Employer NICs shall be transferred tothe Optionee.

 

AnOptionee’s employer or former employer may decide to release the Optionee from,or not to enforce, any part of the Optionee’s obligations in respect ofEmployer NICs under rule 22.2 and rule 22.3.

 

22.4         If an Optionee does not fulfil his obligations under rule 22.2(a) orrule 22.2(b) in respect of any Tax Liability arising from theexercise of an Option within seven days after the date of exercise and Sharesare readily saleable at that time, the Company shall withhold Sufficient Sharesfrom the Shares which would otherwise be delivered to the Optionee. From thenet proceeds of sale of those withheld Shares, the Company shall pay to theemployer or former employer an amount equal to the Tax Liability and shall payany balance to the Optionee.

 

23.           **MANNER OF PAYMENT FOR SHARES ONEXERCISE OF OPTIONS**

 

Theamount due on the exercise of an Option shall be paid in cash or by cheque orbanker’s draft and may be paid out of funds provided to the Optionee on loan bya bank, broker or other person. Notwithstanding the wording in Paragraph 9(b)-(f) ofthe Plan, the amount may not be paid by the transfer to the Company of Sharesor any other shares or securities.

 

Theamount due on the exercise of the Option, including the option price and anywithholding taxes due may be satisfied by a broker assisted cashless exerciseprocedure provided that this has been agreed with HMRC.

 

24.           **ISSUE OR TRANSFER OF SHARES ONEXERCISE OF OPTIONS**

 

Subjectonly to compliance by the Optionee with the rules of the UK Sub-Plan andto any delay necessary to complete or obtain:

 

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(a)           the listing of the Shares on any stock exchange onwhich Shares are then listed;

 

(b)           such registration or other qualification of the Sharesunder any applicable law, rule or regulation as the Company determines isnecessary or desirable;

 

theCompany shall, as soon as reasonably practicable and in any event not laterthan thirty days after the date of exercise of an Option, issue or transfer tothe Optionee, or procure the issue or transfer to the Optionee of, the numberof Shares specified in the notice of exercise and shall deliver to the Optionee,or procure the delivery to the Optionee of, a stock certificate in respect ofsuch Shares together with, in the case of the partial exercise of an Option, anOption Agreement in respect of, or the original Option Agreement endorsed toshow, the unexercised part of the Option, **SAVE THAT** theexercise of an Option will only be permitted if at the date of exercise theOptionee is compliant with paragraphs (a) and (b) of definition ofEligible Employee.

 

Thesecond section of Paragraph 9 of the Plan shall be construed accordingly.

 

25.           **DEATH OF OPTIONEE**

 

Ifan Optionee dies, his personal representatives shall be entitled to exercisehis Options for the period specified in the Option Agreement, which shall in noevent be later than the twelve month period following his death. If not soexercised, the Options shall lapse immediately.

 

26.           **CHANGE IN CONTROL OF COMPANY**

 

26.1         Exchange of Options

 

If acompany (“Acquiring Company”) obtains Control of the Company:

 

(a)           as a result of making a general offer to acquire thewhole of the issued ordinary share capital of the Company which is made on acondition such that if it is satisfied the person making the offer will haveControl of the Company; or

 

(b)           as a result of making a general offer to acquire allthe shares in the Company of the same class as the Shares; or

 

(c)           in circumstances covered by US legislation which HMRCaccepts are closely comparable in purpose and effect to the provisions of Section 899or Sections 979 to 982 of the UK Companies Act 2006.

 

an Optioneemay, at any time during the period set out in rule 26.2, by agreement withthe Acquiring Company, release his Option in whole or in part in considerationof the grant to him of a new option (“New Option”) which is equivalent to theOption but which relates to shares (“New Shares”) in:

 

(d)           the Acquiring Company;

 

(e)           a company which has Control of the Acquiring Company;or

 

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(f)            a company which either is, or has Control of, acompany which is a member of a Consortium which owns either the AcquiringCompany or a company having Control of the Acquiring Company.

 

26.2         Period allowed for exchange of Options

 

Theperiod referred to in rule 26.1 is the period of six months beginning withthe time when the person making the offer has obtained Control of the Companyand any condition subject to which the offer is made has been satisfied.

 

26.3         Meaning of “equivalent”

 

TheNew Option shall not be regarded for the purpose of this rule 26 asequivalent to the Option unless:

 

(a)           the New Shares satisfy the conditions specified inparagraphs 15 to 20 inclusive of Schedule 4; and

 

(b)           save for any performance target or other conditionimposed on the exercise of the Option, the New Option will be exercisable inthe same manner as the Option and subject to the provisions of the UK Sub-Planas it had effect immediately before the release of the Option; and

 

(c)           the total market value, immediately before the releaseof the Option, of the Shares which were subject to the Option is equal to thetotal market value, immediately after the grant of the New Option, of the NewShares (market value being determined for this purpose in accordance with Part VIIIof the Taxation of Chargeable Gains Act 1992); and

 

(d)           the total amount payable by the Optionee for theacquisition of the New Shares under the New Option is equal to the total amountthat would have been payable by the Optionee for the acquisition of the Sharesunder the Option.

 

26.4         Date of grant of New Option

 

Thedate of grant of the New Option shall be deemed to be the same as the Date ofGrant of the Option.

 

26.5         Application of UK Sub-Plan to New Option

 

Inthe application of the UK Sub-Plan to the New Option, where appropriate,references to “Company” and “Shares” shall be read as if they were referencesto the company to whose shares the New Option relates and the New Shares,respectively, save that in the definition of “Administrator” the reference to “Company”shall be read as if it were reference to EnerNOC, Inc.

 

26.6         Interaction with Paragraph 24b. of the Plan

 

(a)           Reference in Paragraph 24b.(i) of the Plansubstituting Options, shall be disapplied for the purposes of the UK Sub-Plan.

 

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(b)           In the event that a change of control does not fallwithin the definition of rule 26.1 above, or where it does, but anAcquiring Company does not agree to grant a New Option, or if a New Optionwould not be regarded as ‘equivalent’ in accordance with rule 26.3 above,the Administrator shall give written notice to the Optionees and anyoutstanding Option shall be exercisable in accordance with Paragraph 24b.(ii) ofthe Plan.

 

(c)           Reference in Paragraph 24b.(iii) of the Plan tothe receipt of a cash payment, shall be disapplied for the purposes of the UKSub-Plan.

 

27.           **RIGHTS ATTACHING TO SHARES ISSUEDON EXERCISE OF OPTIONS**

 

AllShares issued on the exercise of an Option shall, as to any voting, dividend,transfer and other rights, including those arising on a liquidation of the Company,rank equally in all respects and as one class with the Shares in issue at thedate of such exercise save as regards any rights attaching to such Shares byreference to a record date prior to the date of such exercise.

 

28.           **AMENDMENT OF UK SUB-PLAN**

 

NotwithstandingParagraphs 9 and 31 of the Plan, no amendment to a Key Feature of the UKSub-Plan shall take effect until it has been approved by the HMRC.

 

29.           **ADJUSTMENT OF OPTIONS**

 

NotwithstandingParagraph 24a. of the Plan, no adjustment may be made to an Option (i) withoutHMRC’s prior approval and (ii) in the event of a stock dividend ordistribution.

 

30.           **EXERCISE OF DISCRETION BY THEADMINISTRATOR**

 

Inexercising any discretion which it may have under the UK Sub-Plan, theAdministrator shall act fairly and reasonably.

 

31.           **DISAPPLICATION OF CERTAINPROVISIONS OF PLAN**

 

Theprovisions of the Plan dealing with:

 

(a)           ISOs (defined in Paragraph 1);

 

(b)           Stock Grants (Paragraphs 7, 10 and 17 - 21);

 

(c)           Other Stock Based Awards (Paragraphs 8 and 10);

 

(d)           Option Conditions (Paragraph 6a.iv);

 

(e)           paying the purchase price through the retention ofShares by the Company (sub-paragraph (c) of Paragraph 9);

 

(f)            Purchase for Investment (Paragraph 22);

 

(g)           Fractional Shares (Paragraph 26);

 

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(h)           Paragraph 4f. of the Plan;

 

(i)            action by the Administrator or the Successor Board inthe second section of Paragraph 24b. in relation to the substitution or cashcancellation of options;

 

(j)            transferringan Option (Paragraph 12);

 

(k)           amendingor modifying an Option (Paragraph 4e and the fourth section of Paragraph 9);

 

(l)            vesting acceleration (third section of Paragraph 9);and

 

(m)          the leaver provisions (Paragraphs 13-16),

 

shallnot form part of, and shall be disregarded for the purposes of the UK Sub-Plan.

 

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**STOCK OPTION AGREEMENT**

 

**Stock Option Granted underHMRC Approved Sub-Plan for UK Employees**

 

**ENERNOC, INC.**

 

AGREEMENT made as of the       day of        20    , betweenEnerNOC, Inc. (the “Company”), a Delaware corporation and                             (the “Optionee”).

 

WHEREAS, the Company desires to grant to theOptionee an Option to purchase shares of its common stock, $.001 par value pershare (the “Shares”), under and for the purposes set forth in the HMRC ApprovedSub-Plan for UK Employees (the “UK Sub-Plan”) a sub-plan to the Company’s Amendedand Restated 2007 Employee, Director and Consultant Stock Plan (the “Plan”);

 

WHEREAS, the Company and the Optioneeunderstand and agree that any terms used and not defined herein have the samemeanings as in the UK Sub-Plan; and

 

WHEREAS, the Company and the Optionee eachintend that the Option granted herein shall be a Non-Qualified Option.

 

NOW, THEREFORE, in consideration of the mutualcovenants hereinafter set forth and for other good and valuable consideration,the parties hereto agree as follows:

 

1.             GRANT OF OPTION.

 

The Company hereby grants to the Optionee theright and option to purchase all or any part of an aggregate of               Shares, on the terms and conditions and subject to all the limitations setforth herein, under United States securities laws, Schedule 4 to the Income Tax(Earnings and Pensions) Act 2003, and in the UK Sub-Plan, which is incorporatedherein by reference.  The Optioneeacknowledges receipt of a copy of the Plan and UK Sub-Plan.

 

2.             PURCHASE PRICE.

 

The purchase price of the Shares covered by theOption shall be $         per Sharewhich is the Market Value of a Share on the Grate Date, subject to adjustment,as provided in the UK Sub-Plan, in the event of a stock split, reverse stocksplit or other events affecting the holders of Shares after the date hereof(the “Purchase Price”).  Payment shall bemade in accordance with rule 23 of the UK Sub-Plan.

 

3.             EXERCISABILITY OF OPTION.

 

Subject to the terms and conditions set forthin this Agreement and the UK Sub-Plan, the Option granted hereby shall becomeexercisable as follows:

 

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| On the first anniversary of the Vest date of  this Agreement ( , 20):                                                 |   | 25% of the Shares                                                          |
|-----------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------|
|                                                                                                                  |   |                                                                       |
| On the first day of each quarter following  the first anniversary of the Vest date of this Agreement for three years: |   | An additional 6.25% of the Shares rounded  down to the nearest whole share |

 

The foregoing rights are cumulative and aresubject to the other terms and conditions of this Agreement and the UKSub-Plan.

 

4.             TERM OF OPTION.

 

This Option shall terminate ten years from thedate of this Agreement, but shall be subject to earlier termination as providedherein or in the UK Sub-Plan.

 

If the Optionee ceases to be an employee of theCompany or of a Constituent Company (for any reason including on ceasingemployment with the intention of retiring, due to injury or redundancy (withinthe meaning of the Employment Rights Act 1996) but other than the death of theOptionee or termination of the Optionee for “cause”), the Option may beexercised, if it has not previously terminated, within three months after thedate the Optionee ceases to be an employee of the Company or a ConstituentCompany, or within the originally prescribed term of the Option, whichever isearlier, but may not be exercised thereafter. In such event, the Option shall be exercisable only to the extent thatthe Option has become exercisable and is in effect at the date of suchcessation of service.

 

Notwithstanding the foregoing, in the event ofthe Optionee’s death within three months after the termination of service, theOptionee’s personal representatives may exercise the Option within one yearafter the date of the Optionee’s death, but in no event after the date ofexpiration of the term of the Option.

 

In the event the Optionee’s service isterminated by the Company or a Constituent Company for “cause”, the Optionee’sright to exercise any unexercised portion of this Option shall ceaseimmediately as of the time the Optionee is notified his or her service isterminated for “cause,” and this Option shall thereupon terminate.  Notwithstanding anything herein to thecontrary, if subsequent to the Optionee’s termination, but prior to theexercise of the Option, the Board of Directors of the Company determines that,either prior or subsequent to the Optionee’s termination, the Optionee engagedin conduct which would constitute “cause,” then the Optionee shall immediatelycease to have any right to exercise the Option and this Option shall thereuponterminate.

 

In the event of the death of the Optionee whilean employee of the Company or of a Constituent Company, the Option shall beexercisable by the Optionee’s personal representatives within one year afterthe date of death of the Optionee or, if earlier, within the originallyprescribed term of the Option.  In suchevent, the Option shall be exercisable:

 

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(x)            to the extent that the Option has become exercisablebut has not been exercised as of the date of death; and

 

(y)           in the event rights to exercise the Option accrueperiodically, to the extent of a pro rata portion through the date of death ofany additional vesting rights that would have accrued on the next vesting datehad the Optionee not died.  The prorationshall be based upon the number of days accrued in the current vesting periodprior to the Optionee’s date of death.

 

5.             METHOD OF EXERCISING OPTION.

 

Subject to the terms and conditions of thisAgreement, the Option may be exercised by written notice to the Company or itsdesignee, in substantially the form of Exhibit A attachedhereto.  Such notice shall state thenumber of Shares with respect to which the Option is being exercised and shallbe signed by the person exercising the Option. Payment of the purchase price for such Shares shall be made inaccordance with rule 23 of the UK Sub-Plan.  The Company shall deliver such Shares as soonas practicable and in any event not later than 30 days after the date ofexercise of the Option after the notice shall be received, provided, however,that the Company may delay issuance of such Shares until completion of anyaction or obtaining of any consent, which the Company deems necessary under anyapplicable law (including, without limitation, state securities or “blue sky”laws).  The Shares as to which the Optionshall have been so exercised shall be registered in the Company’s shareregister in the name of the person so exercising the Option and shall bedelivered as provided above to or upon the written order of the personexercising the Option.  In the event theOption shall be exercised, pursuant to Section 4 hereof, by any personother than the Optionee, such notice shall be accompanied by appropriate proofof the right of such person to exercise the Option.  All Shares that shall be purchased upon theexercise of the Option as provided herein shall be fully paid andnonassessable.

 

6.             PARTIAL EXERCISE.

 

Exercise of this Option to the extent abovestated may be made in part at any time and from time to time within the abovelimits, except that no fractional share shall be issued pursuant to thisOption.

 

7.             NON-ASSIGNABILITY.

 

The Option shall not be transferable by theOptionee except for a transfer on death to the Optionee’s personalrepresentative.  Except as provided abovein this paragraph, the Option shall be exercisable, during the Optionee’slifetime, only by the Optionee (or, in the event of legal incapacity orincompetency, by the Optionee’s guardian or representative) and shall not beassigned, pledged or hypothecated in any way (whether by operation of law orotherwise) and shall not be subject to execution, attachment or similarprocess.  Any attempted transfer,assignment, pledge, hypothecation or other disposition of the Option or of anyrights granted hereunder contrary to the provisions of this Section 7, orthe levy of any attachment or similar process upon the Option shall be null andvoid.

 

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8.             NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE.

 

The Optionee shall have no rights as astockholder with respect to Shares subject to this Agreement until registrationof the Shares in the Company’s share register in the name of the Optionee.  Except as is expressly provided in the UK Sub-Planwith respect to certain changes in the capitalization of the Company, noadjustment shall be made for dividends or similar rights for which the recorddate is prior to the date of such registration.

 

9.             ADJUSTMENTS.

 

The UK Sub-Plan contains provisions coveringthe treatment of Options in a number of contingencies such as stocksplits.  Provisions in the UK Sub-Planfor adjustment with respect to stock subject to Options are hereby madeapplicable hereunder and are incorporated herein by reference.

 

10.           CHANGE OF CONTROL.

 

Rule 26 of the UK Sub-Plan sets out thecircumstances, upon a change of control, under which Options may be substitutedfor new options in the acquiring company, and retain their tax approved status.If the provisions of this Rule are not met, the Board of Directors of theCompany, will give written notice to Optionees and any outstanding Option willbe exercisable in accordance with Paragraph 24b.(ii) of the Plan.

 

11.           TAXES.

 

(a)           Depending on the circumstances, on exercise of the Option the Optioneemay have an income tax liability under PAYE and may be required to pay nationalinsurance contributions (NICs).  If so,then:

 

(1)           The Company or the company which employs the Optionee may require theOptionee to pay amounts in respect of PAYE and NICs liability in cash;

 

(2)           The Optionee may be required to:

 

(i)            pay; or

 

(ii)           enter into a joint election to transfer; or

 

(iii)          enter into an arrangement or agreement for the paymentof,

 

some or all of his employer’s secondary class 1NICs liability arising from exercise of the Option; and

 

(3)           in some circumstances the Company may withhold the number of Sharesrequired to meet the liabilities in respect of PAYE, primary (employee) class 1NICs and secondary (employer) class 1 NICs.

 

(b)           The Option may only be exercised if the Optionee:

 

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(1)           confirms (in writing) that he agrees to the requirements of the UKSub-Plan relating to PAYE and NICs (Rule 22).  This may be done at the time of exercise; and

 

(2)           makes any arrangements, or enter into any agreements, that may berequired under Rule 22.

 

12.           NO OBLIGATION TO MAINTAIN RELATIONSHIP.

 

The Company is not by the UK Sub-Plan or thisOption obligated to continue the Optionee as an employee of the Company or aConstituent Company.  The Optioneeacknowledges:  (i) that the UKSub-Plan is discretionary in nature and may be suspended or terminated by theCompany at any time; (ii) that the grant of the Option is a one-timebenefit which does not create any contractual or other right to receive futuregrants of options, or benefits in lieu of options; (iii) that alldeterminations with respect to any such future grants, including, but notlimited to, the times when options shall be granted, the number of sharessubject to each option, the option price, and the time or times when eachoption shall be exercisable, will be at the sole discretion of the Company; (iv) thatthe Optionee’s participation in the UK Sub-Plan is voluntary; (v) that thevalue of the Option is an extraordinary item of compensation which is outsidethe scope of the Optionee’s employment contract, if any; and (vi) that theOption is not part of normal or expected compensation for purposes ofcalculating any severance, resignation, redundancy, end of service payments,bonuses, long-service awards, pension or retirement benefits or similarpayments.

 

13.           NOTICES.

 

Any notices required or permitted by the termsof this Agreement or the UK Sub-Plan shall be given by recognized courier service,facsimile, registered or certified mail, return receipt requested, addressed asfollows:

 

 

 
| If to the Company:  |   |                                |
|---------------------|--------|-------------------------------------|
|                |   | EnerNOC, Inc.                  |
|                |   | Attn: Chief Financial Officer       |
|                |   | 101 Federal Street, Suite 1100 |
|                |   | Boston, MA 02110                    |
|                |   |                                |
|                |   |                                |
| If to the Optionee: |   |                                |
|                |   |                                |
|                |   |                                |   |
|                |   |                                |   |
|                |   |                                |   |

 

or to such other address or addresses of whichnotice in the same manner has previously been given.  Any such notice shall be deemed to have beengiven upon the earlier of receipt, one business day following delivery to arecognized courier service or three business days following mailing byregistered or certified mail.

 

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14.           GOVERNING LAW.

 

This Agreement shall be construed and enforcedin accordance with the laws of the Commonwealth of Massachusetts without givingeffect to the conflict of law principles thereof.  For the purpose of litigating any disputethat arises under this Agreement, the parties hereby consent to exclusivejurisdiction in the Commonwealth of Massachusetts****andagree that such litigation shall be conducted in the courts of Suffolk County,Massachusetts****or the federal courts of theUnited States for the District of Massachusetts.

 

15.           BENEFIT OF AGREEMENT.

 

Subject to the provisions of the UK Sub-Planand the other provisions hereof, this Agreement shall be for the benefit of andshall be binding upon the heirs, executors, administrators, successors andassigns of the parties hereto.

 

16.           ENTIRE AGREEMENT.

 

This Agreement, together with the UK Sub-Plan,embodies the entire agreement and understanding between the parties hereto withrespect to the subject matter hereof and supersedes all prior oral or writtenagreements and understandings relating to the subject matter hereof.  No statement, representation, warranty,covenant or agreement not expressly set forth in this Agreement shall affect orbe used to interpret, change or restrict the express terms and provisions ofthis Agreement, provided, however, in any event, this Agreement shall besubject to and governed by the UK Sub-Plan.

 

17.           MODIFICATIONS AND AMENDMENTS.

 

The terms and provisions of this Agreement maybe modified or amended as provided in the UK Sub-Plan.

 

18.           WAIVERS AND CONSENTS.

 

Except as provided in the UK Sub-Plan, theterms and provisions of this Agreement may be waived, or consent for thedeparture therefrom granted, only by written document executed by the partyentitled to the benefits of such terms or provisions.  No such waiver or consent shall be deemed tobe or shall constitute a waiver or consent with respect to any other terms orprovisions of this Agreement, whether or not similar.  Each such waiver or consent shall beeffective only in the specific instance and for the purpose for which it wasgiven, and shall not constitute a continuing waiver or consent.

 

19.           DATA PRIVACY.

 

By entering into this Agreement, theOptionee:  (i) authorizes theCompany and each Constituent Company, and any agent of the Company or anyConstituent Company administering the UK Sub-Plan or providing UK Sub-Planrecordkeeping services, to disclose to the Company or any of its ConstituentCompanies such information and data as the Company or any such ConstituentCompany shall request in order to facilitate the grant of options and theadministration of the UK Sub-Plan; (ii) waives any data privacy rights heor she may have with 

 

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respect to such information; and (iii) authorizesthe Company and each Constituent Company to store and transmit such informationin electronic form outside of the European Economic Area.

 

20.           COUNTERPARTS.

 

This deed may be executed in any number ofcounterparts.  This has the same effectas if signatures on the counterparts were on a single copy of this deed.

 

[REMAINDER OF PAGEINTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF the parties have executedthis option as a deed and the Company has caused it to be executed under itscorporate seal by its duly authorized officer. This option shall take effect as a deed and sealed instrument.

 

By executing this agreement the Optioneeaccepts the foregoing option award, agrees to the terms and conditions hereofand acknowledges having received and read a copy of the Company’s 2007Employee, Director and Consultant Stock Plan and the UK Sub-Plan and agrees tocomply with the UK Sub-Plan and all applicable laws and regulations.

 
|   | ENERNOC, INC. |
|--------|--------------------|
|   |               |
|   |               |
| Dated: |               |   | By: |   |
|   |               |   |   |   |
|   |               | Name: |   |
|   |               | Title: |   |

 

 
| EXECUTED as a DEED  by |                       |
|------------------------|----------------------------|
| OPTIONEE:              | By:                        |   |
|                   | (Signature of Optionee)    |
|                   | Name:                      |   |
|                   | (Printed Name of Optionee) |

 
| In the presence of: |   |   |
|---------------------|--------|--------|
| Witness signature:  |   |   |
|                |   |   |
|                |   |   |
| Witness name:       |   |   |
|                |   |   |
| Witness address:    |   |   |
|                |   |   |
|                |   |   |
|                |   |   |
| Witness occupation: |   |   |

 

8

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SCHEDULE

 

Set forth below is a brief summary of certainUK tax consequences of exercise of the option and disposition of the Sharesunder the laws in effect as of 11 August 2010. THIS SUMMARY IS BASED ONTHE OPTIONEE BEING RESIDENT, ORDINARILY RESIDENT AND DOMICILED IN THE UK ATGRANT, IT IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARESUBJECT TO CHANGE. OPTIONEE SHOULD SEEK PROFESSIONAL ADVICE BEFORE EXERCISINGTHIS OPTION OR DISPOSING OF THE SHARES

 

(a)           Exercise of Stock Option.  No UK income tax will be payable on theexercise of an Option, provided the UK Sub-Plan remains approved by the HMRCand at least three years, and no more than ten years have elapsed from the Dateof Grant.

 

(i)            No UK income tax will be payable on the exercise of anOption within three years of the Date of Grant if the right to exercise arisesbecause of the Optionee ceasing employment due to disability or redundancy(within the meaning of the Employment Rights Act 1996) and the Option isexercised within six months of leaving.

 

(ii)           If there is a liability to income tax, the Optioneewill be chargeable to income tax on (broadly) the difference between the marketvalue of the Shares acquired and the option price paid for them. If income taxis due, it will need to be withheld by the employer under PAYE.  There will also be National InsuranceContributions payable.

 

(b)           Disposal of Shares.  On a disposal of the Shares followingexercise in an approved manner, capital gains tax will be payable on thedifference between the price realised on sale and the exercise price of theShares subject to certain exemptions which may be available.

 

On a disposal of the Shares following exercisewhere an income tax charge arose, capital gains tax will be payable on thedifference between the price realised on sale and the value of the Shares atthe date of exercise (subject to the annual exemption which may be available).

 

9

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Exhibit A

 

NOTICE OF EXERCISE OF STOCKOPTION GRANTED UNDER

THE HMRC APPROVED SUB-PLANFOR UK EMPLOYEES

 

TO:         EnerNOC, Inc.

 

DATE:                   20     

 

IMPORTANT NOTICE:  This form of Notice of Exercise may only beused at such time as the Company has filed a Registration Statement with theSecurities and Exchange Commission under which the issuance of the Shares forwhich this exercise is being made is registered and such Registration Statementremains effective.

 

Ladies and Gentlemen:

 

1.             I hereby exercise my Stock Option to purchase                  shares (the “Shares”) of the common stock, $.001 par value, of EnerNOC, Inc.****(the “Company”), at the exercise price of$                per share, pursuant to and subject to the terms of that certain Stock OptionAgreement between the undersigned and the Company dated                              ,20    .

 

2.             I understand the nature of the investment I am making and the financialrisks thereof.  I am aware that it is myresponsibility to have consulted with competent tax and legal advisors aboutthe relevant national, state and local income tax and securities laws affectingthe exercise of the Option and the purchase and subsequent sale of the Shares.

 

3.             I enclose a cheque for$                                  .

 

4.             In relation to my Income Tax and NICs Liability:

 

·              I believe there will be no Tax Liability.

 

·              I irrevocably agree to pay to the Company, my employer or formeremployer an amount equal to my Tax Liabilities or enter into arrangements tothe satisfaction of the Company.

 

·              I have included payment for my Tax Liability in theenclosed cheque.

 

*(Delete all but one of thebullet points above, as appropriate.)*

 

5.             I understand and agree that, if I do not fulfil anyobligation under 4 above within seven days after the date of this exercise, theCompany may retain and sell enough of the Shares to satisfy my Tax Liabilities,together with any costs arising from that sale. I shall be entitled to any balance of the sale proceeds.

 

A-1

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6.             I appoint the Company (acting by any of its directorsfrom time to time) as my agent and attorney to sell Shares and deal with theproceeds of sale as specified in 5 above in my name and on my behalf.

 

The Company may appoint one or more persons toact as substitute agent(s) and attorney(s) for me and to exercise oneor more of the powers conferred on the Company by this power of attorney, otherthan the power to appoint a substitute attorney.  The Company may subsequently revoke any suchappointment.

 

This power of attorney shall be irrevocable,save with the consent of the Company, and is given by way of security to securethe interest of the Company (for itself and as trustee under the Option onbehalf of any employer or former employer of mine) as a person liable toaccount for or pay any relevant Tax Liabilities.

 

I declare that a person who deals in good faithwith the Company or any substitute attorney as my attorney appointed under thisdeed may accept a written statement signed by that person to the effect thatthis power of attorney has not been revoked as conclusive evidence of thatfact.

 

7.             Please issue the Shares to me at the followingaddress:

 

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 

8.             My mailing address for shareholder communications, ifdifferent from the address listed above, is:

 

 
|   |   |
|--------|--------|
|   |   |
|   |   |

 

A-2

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This document has been executed as a deed andis delivered and takes effect on the date stated at the beginning of it.

 

 
| EXECUTED as a DEED  by |                       |
|------------------------|----------------------------|
| OPTIONEE:              | By:                        |   |
|                   | (Signature of Optionee)    |
|                   | Name:                      |   |
|                   | (Printed Name of Optionee) |

 
| In the presence of: |   |   |
|---------------------|--------|--------|
| Witness signature:  |   |   |
|                |   |   |
|                |   |   |
| Witness name:       |   |   |
|                |   |   |
| Witness address:    |   |   |
|                |   |   |
|                |   |   |
|                |   |   |
| Witness occupation: |   |   |

 

A-3

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