Exhibit 10.1


 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT (“Agreement”)
is entered into as of August 5, 2005, by and between Keane, Inc., a
Massachusetts corporation with its principal place of business at 100 City
Square, Boston, Massachusetts 02129 (“Keane” or the “Company”), and Richard
Garnick (the “Executive”).  Keane and the
Executive are referred to together herein as the “Parties.”


 


WHEREAS, Keane has offered employment
to the Executive in the position of President, North American Services, and the
Executive has accepted, both Parties desire to set forth in a written agreement
the terms and conditions of the Executive’s employment by and services to the
Company;


 


NOW, THEREFORE, for good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the
Company and the Executive agree as follows:


 


1.             Effective
Date. The Effective Date of this Agreement is
September 5, 2005.


 


2.             Executive
Representations.


 


a.             The Executive affirms that he is not
subject to any agreement that restricts his ability to work for Keane in the
role contemplated by this Agreement.


 


b.             The Executive affirms that he has not
taken and will not take, bring onto Keane’s premises, or use on behalf of Keane
any confidential, proprietary and/or trade secret information belonging to any
current or former employer, partner, client, joint venture, investor, or other
third party.


 


c.             The Executive affirms that he has honored
all commitments to former employers, as set forth in any applicable employment
agreements or otherwise, and intends to continue to honor all such commitments.


 


3.             Employment
Period. 
Subject to the benefits described in Section 7, the Company retains the
right to terminate the employment of the Executive at any time, including,
without limitation, with or without notice and with or without Cause.


 


4.             Position
and Duties.


 


a.             During his employment with Keane, the
Executive shall serve as with the duties and responsibilities customarily
assigned to the position of President, North American Services, and such other
duties and responsibilities as the Board of Directors (the “Board”) or the
Chief Executive Officer of the Company shall from time to time assign to the
Executive.  The Executive shall report
directly to the Chief Executive Officer of the Company.


 





















 


b.             During his employment with Keane, and
excluding any periods of vacation and sick leave to which the Executive is
entitled, the Executive shall devote his full business attention and time to
the business and affairs of Keane and shall use his best efforts to carry out
such responsibilities faithfully and efficiently, and in accordance with Keane
policy and procedures. Subject to Company approval where required by applicable
policy, it shall not be considered a violation of the foregoing for the
Executive to (a) serve on corporate, civic or charitable boards or committees,
(b) deliver lectures, fulfill speaking engagements or teach at educational
institutions and (c) manage personal investments, so long as such activities do
not materially interfere with the performance of the Executive’s
responsibilities as an employee of Keane in accordance with this Agreement.


 


c.             The Executive shall be considered an
officer of the Company.  As such, he
shall be entitled to indemnification and other related protections, as
described in Article VI of the Company’s Restated Articles of Organization,
attached as Exhibit A.  These protections
include, but are not limited to, coverage under Keane’s Directors &
Officers Liability insurance policy, within its current limit of $35,000,000.


 


5.             Compensation
and Benefits


 


a.             Base Salary. As compensation for the Executive’s
services hereunder during the Employment Period, the Company shall pay to the
Executive an annual salary (the “Base Salary”) of not less than $500,000
payable at such times and intervals as the Company pays the base salaries of
its other executive employees. The Base Salary shall be reviewed annually for
possible increase. The Base Salary shall not be reduced after any such
increase, and the term “Base Salary” shall thereafter refer to the Base Salary
as so increased.


 


b.             Annual Bonus.


 


(i)            For each fiscal year, the Executive shall be eligible
for an annual bonus (the “Annual Bonus”). 
The target amount of the Annual Bonus (“Bonus Target”) will be 80% of
the annual Base Salary.  The actual
amount of each year’s Annual Bonus may be less than the Bonus Target or up to
150% of the Bonus Target, depending upon certain performance measures.  The precise amount of the Annual Bonus shall
be determined by the Chief Executive Officer subject to approval by the
Compensation Committee of the Board. The Bonus Target will be reviewed annually
for possible future increase or decrease. 
Annual Bonuses are not earned until the close of business on the last
business day of Keane’s fiscal year, are based on fiscal year performance and
are generally paid in March or April of the following year, subject to the
condition precedent that the Executive is employed on the date the Annual Bonus
is paid.


 


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(ii)           For 2005, the Annual Bonus shall be prorated to
reflect the amount of time the Executive is employed by Keane.  Of that prorated amount, Keane will pay no
less than seventy-five percent (75%), subject to the condition precedent
described in Section 5.b(i).


 


c.             Stock.


 


(i)            2005.  Within thirty
(30) days of the Effective Date, the Executive will be awarded 300,000 Keane
Incentive Stock Options and 10,000 shares of restricted stock, both subject to
the terms and conditions of the applicable stock option plan and incentive
and/or restricted stock agreements, attached as Exhibit B.


 


(ii)           2006 and 2007.  The Executive
will be awarded no less than 100,000 Keane Incentive Stock Options in 2006 and
in 2007, provided the Executive achieves no less than twenty percent (20%)
organic growth in each of these years (measured by both revenue and
contribution) within the area of his responsibility, subject to approval by the
Compensation Committee of the Board.


 


d.             Benefits. During his employment with Keane, the Executive
shall be entitled to receive employee benefits (including without limitation
medical, life insurance and other welfare benefits and benefits under
retirement and savings plans), Company-provided parking and paid vacation, in each
case to the same extent as, and on the same terms and conditions as, other
similarly situated senior executives of the Company from time to time.


 


e.             Expenses. The Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Executive during his
employment with Keane in carrying out his duties under this Agreement, provided
that the Executive complies with the policies, practices and procedures of the
Company for submission of expense reports, receipts, or similar documentation
of such expenses.


 


6.             Employment
Termination.  The Executive’s employment pursuant to this
Agreement may be terminated as follows:


 


a.             For Cause.  At the
election of Keane, for “Cause”, immediately upon written notice by Keane to the
Executive.  For the purposes of this
Agreement, “Cause” for termination shall mean and shall be limited to:


 


1.             Wrongful misappropriation of the funds or
property of the Company;


 


2.             Use of alcohol or illegal drugs
interfering with the performance of the Executive’s obligations, continuing
after written warning of such actions;


 


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3.             Commission of a felony, or of any crime
involving moral turpitude, dishonesty, theft or unethical conduct;


 


4.             Commission of any willful, intentional or
grossly negligent act which would reasonably be expected to materially injure
the reputation, business or business relationships of the Company or which
would bring the Executive or the Company into disrepute, or the willful
commission of any act which is a breach of the Executive’s fiduciary duties to
the Company;


 


5.             The deliberate or willful failure by the
Executive (other than by reason of the Executive’s physical or mental illness,
incapacity or disability) to substantially perform his duties with the Company
and the continuation of such failure for a period of 30 days after delivery by
the Company to the Executive of Notice specifying the scope and nature of such
failure and the Company’s intention to terminate the Executive for Cause;


 


6.             Commission of any act which constitutes a
material breach of the policies of the Company, including but not limited to
the disclosure of any confidential information or trade secrets pertaining to
the Company or any of its clients; or


 


7.             Commission of any dishonest act
or the making of any dishonest or intentionally misleading statement relating
to the business of the Company.


 


b.             For Good Reason. 
At the Executive’s initiative, for “Good Reason” if:


 


1.             The Executive’s title, duties, status, reporting
relationship, authority or responsibilities have been materially and adversely
affected; or


 


2.             The Executive’s compensation, including Base Salary and Bonus Target, has been
reduced by 10% or greater; or


 


3.             The Executive’s principal place of employment is
relocated to a location more than 60 miles from such place of employment.


 


4.             In the context of a Change in Control, as described in
Section 7.b, “Good Reason” shall also be deemed to exist if the Executive’s
principal place of employment immediately prior to the Change in Control is
relocated to a location more than 25 miles from such place of employment.


 


The Executive shall give
the Company Notice of termination specifying which of the foregoing provisions
is applicable and the factual basis therefor, and if the


 


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Company fails to remedy
such material failure, the Executive’s last day of actual employment with Keane
shall be the 30th business day after such Notice is given or such other date as
the Company and the Executive shall agree.


 


c.             In the Event of Death or Disability. 
As used in this Agreement, the term “disability” shall mean the
inability of the Executive, due to a physical or mental disability, for a
period of 180 days, whether or not consecutive, during any 360-day period to
perform the services contemplated under this Agreement.  A determination of disability shall be made
by a physician satisfactory to both the Executive and Keane, provided that if
the Executive and Keane do not agree on a physician, the Executive and Keane
shall each select a physician and these two together shall select a third
physician, whose determination as to disability shall be binding on all
parties;


 


d.             At the election of Keane without Cause, upon not less than 90 days’ prior
written notice of termination; or


 


e.             At the election of the Executive, other than for Good Reason, upon not
less than 90 days’ prior written notice of termination.


 


7.             Effect
of Employment Termination


 


a.             For Cause.  If the
Executive’s employment is terminated by Keane for Cause pursuant to Section
6.a, Keane shall pay to the Executive the compensation and benefits otherwise
payable to him through the last day of his actual employment by Keane.  


 


b.             Following a Change in Control. 
If the Executive’s employment is terminated by the Company without Cause
(as defined in Section 6.a) or by the Executive for Good Reason (as defined in
Section 6.b) within one year following a Change in Control, as defined in
Exhibit C to this Agreement, the effective date of any such termination being
hereinafter referred to as the “CIC Termination Date”) the Executive shall be
entitled to the following severance benefits (and no others):


 


(i)            For a period of twenty-four (24) months following the
CIC Termination Date (the “Salary Continuation Period”), the Company shall
continue to pay the Executive the base salary and targeted annual bonus
(monthly on a pro rata basis), both at the rate in effect immediately before
the CIC Termination Date, except that
in the case of a termination by the Executive for Good Reason, disregarding any
reduction thereof that was the basis for such termination.


 


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(ii)           Upon the CIC Termination Date, all stock options,
restricted stock and other equity awards previously granted to the Executive
shall become vested immediately and shall be exercisable in full in accordance
with the applicable stock option, restricted stock or other form of equity
agreement and the terms of any applicable stock or equity plan.


 


(iii)          The CIC Termination Date shall be treated as a
qualifying event under the Consolidated Omnibus Reconciliation Act of 1985 (“COBRA”).  Under COBRA, if the Executive is covered by
the group medical and/or dental plan offered by Keane, the Executive and his or
her spouse and dependents are entitled to elect a temporary extension of health
and/or dental coverage at group rates in certain instances where coverage under
the plan would otherwise end (“Continuation Coverage”).  If the Executive elects Continuation Coverage
under COBRA, during the period of such Continuation Coverage, the Executive
will be responsible for any contribution required from active employees of the
Company under the applicable group medical and/or dental plan.  If and to the extent this Section 7.b(iii)
does not apply, as where the Executive is not resident in or of the United
States, the Executive shall receive a monthly stipend to offset medical and/or
dental benefits lost following the CIC Termination Date.


 


(iv)          During the Salary Continuation Period, the Executive
shall be entitled to continue participation in the executive financial planning
benefit in effect as of the CIC Termination Date.


 


c.             In the Event of Death or Disability. 
If the Executive’s employment is terminated by death or because of
disability pursuant to Section 6.c, Keane shall pay to the estate of the
Executive or to the Executive, as the case may be, the compensation which would
otherwise be payable to the Executive up to the end of the month in which the
termination of his employment because of death or disability occurs. 


 


d.             At the Election of Keane without Cause or
At the Initiative of the Executive for Good Reason. 
If the Executive’s employment is terminated by Keane without Cause (as
defined in Section 6.a) pursuant to Section 6.d or at the initiative of the
Executive for Good Reason, pursuant to Section 6.b:


 


(i)            Keane shall continue to pay the Executive his Base
Salary, for twelve (12) months, plus, in the case of termination by Keane without
Cause, any portion of the 90-day notice period described in Section 6.d that is
not provided to the Executive; and


 


(ii)           The last day of the Executive’s actual employment with
Keane shall be treated as a qualifying event under the Consolidated Omnibus
Reconciliation Act of 1985 (“COBRA”), and the Executive will receive COBRA
information under separate cover.  If the
Executive elects


 


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continuation coverage under COBRA, during the period
the Executive is receiving base salary continuation payments under this
paragraph 7.d, he will be responsible for any contribution required from active
employees of the Company under said health insurance program.


 


e.             Receipt of severance benefits is
conditioned on Executive’s execution and delivery of a separation agreement
including a general release of claims, in a form acceptable to the Company, and
on Executive’s strict compliance with the provisions of any agreement between
the Executive and Keane pertaining to trade secrets, confidential information,
works made for hire and inventions, competition, solicitation, hiring, and the
return of Company property.


 


f.              At the Election of the Executive Other
than for Good Reason.  If the Executive elects to terminate his employment
other than for Good Reason, in accordance with Section 6.e, Keane shall pay to
the Executive the compensation and benefits otherwise payable to him through
the last day of his actual employment by Keane.


 


8.             Limitations
on Payment of Benefits.


 


a.             Neither the Executive nor Keane shall
have the right to accelerate or to defer the delivery of the payments to be
made under this Agreement; provided, however, that if the
Executive is a “specified employee” as defined in Section 409A(a)(2)(B)(i) of
the Internal Revenue Code of 1986, as amended (the “Code”), and any of the
payments to be made to the Executive under this Agreement constitute “nonqualified
deferred compensation” within the meaning of Section 409A of the Code, then the
commencement of the delivery of any such payments will be delayed to the date
that is six months after the last day of the Executive’s actual employment with
Keane.


 


b.             Gross-Up Payment.


 


(i)            Anything in this or any other Agreement to the
contrary notwithstanding, in the event an Executive becomes entitled to any
benefits or payments under this Agreement or under any other agreement, plan or
arrangement to which the Company and the Executive are parties, including any
non-cash benefit or deferred payment or benefit (the “Total Benefits”), which
will be subject to a tax imposed by Section 4999 of the Code (the “Excise Tax”)
due to classification as an excess parachute payment in accordance with Section
280G of the Code, the Company shall pay to him an additional amount (the “Gross-Up
Payment”) such that the net amount retained by him, after reduction of any
Excise Tax on the Total Benefits and any federal, state and local income tax,
Excise Tax and FICA and Medicare withholding taxes upon the payment provided
for by this Section, shall be equal to the Total Benefits.  For purposes of this Gross-Up Payment, the
amount of the Excise Tax (if any) imposed on any non-cash benefits or any
deferred payment or benefit shall be reasonably


 


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determined by the Company, after consultation with its
legal and tax advisors.


 


(ii)           For purposes of determining the amount of the Gross-Up
Payment, an Executive shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation in the calendar year in which
the Gross-Up Payment is to be made and state and local income taxes at the
highest marginal rate of taxation in the state and locality of his residence on
the Termination Date, net of the reduction in federal income taxes which could
be obtained from deduction of such state and local taxes (calculated by
assuming that any reduction under Section 68 of the Code in the amount of
itemized deductions allowable to him applies first to reduce the amount of such
state and local income taxes that would otherwise be deductible by him).


 


(iii)          In the event that the Excise Tax is subsequently
determined to be less than the amount taken into account for purposes of
calculating the Gross-Up Payment, the Executive shall promptly repay to the
Company the portion of the Gross-Up Payment attributable to such reduction
(plus that portion of the Gross-Up Payment attributable to the Excise Tax,
federal, state and local income taxes and FICA and Medicare withholding taxes
imposed on the portion of the Gross-Up Payment being repaid by him to the
extent that such repayment results in a reduction in Excise Tax, FICA and
Medicare withholding taxes and/or federal, state or local income taxes) plus
interest on the amount of such repayment at the rate provided in Section

1274(b)(2)(B) of the Code.


 


(iv)          In the event that the Excise Tax is determined to
exceed the amount taken into account hereunder, the Company shall make an
additional Gross-Up Payment to him in respect of such excess (plus any
interest, penalties or additions payable by him with respect to such excess) at
the time that the amount of such excess is finally determined.


 


(v)           The Gross Up Payment shall be made within two and a
half months after the last day of the Executive’s actual employment with Keane;
provided, however, that if the Executive is a “specified employee”
as defined in Section 409A(a)(2)(B)(i) of Code and any of the payments to be
made to the Executive under this Section 4 constitute “nonqualified deferred
compensation” within the meaning of Section 409A of the Code, then the
commencement of the delivery of any such payments will be delayed by six
months.


 


(vi)          The intent of this Section 8 is to make the Executive
whole, to the extent allowed under applicable laws and regulations, such that
he is not detrimentally impacted by the imposition of a tax over and above the
marginal rate applicable to his Keane-related earnings as a result of a


 


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Change In Control. 
To the extent the Executive is subject to income tax laws of a country
other than the United States, the Company shall use its best efforts to
implement the intent of this Section 8 in accordance with applicable laws and
regulations.


 


9.             Obligations
and Restrictive Covenants.


 


a.             The Executive agrees to execute an
Agreement pertaining to, without limitation, confidentiality, non-disclosure,
non-solicitation and non-competition, in the form attached as Exhibit D.


 


b.             All obligations and restrictive covenants
as set forth in any existing or future employment agreements, stock option
agreements, codes of conduct, or the like, shall remain in full force and
effect notwithstanding this Agreement, including but not limited to, provisions
and/or restrictions relating to trade secrets, confidential information, works
made for hire and inventions, competition, solicitation, hiring, Company
property, et cetera, except that any and all such obligations and restrictive
covenants shall remain in full force and effect for the entire Salary Continuation
Period notwithstanding any shorter period set forth therein.


 


10.           Notices.


 


a.             Each notice, demand, consent or
communication (hereinafter “Notice”) which is or may be required to be given by
any party to the other party in connection with this Agreement shall be in
writing and given by facsimile, personal delivery, receipted delivery services,
or by certified mail, return receipt requested, prepaid and properly addressed
to the other party as shown below.


 


b.             Notices shall be effective on the date
sent via facsimile, the date delivered personally or by receipted delivery
service, or three (3) days after the date mailed:


 


(i)            To the Company:


 


Legal Department

Attn:
Corporate Counsel

Keane, Inc.

100 City Square

Charlestown, MA  02129


 


(ii)           To the Executive:


 


At the residence address
most recently filed with the Company.


 


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11.           Succession
and Assignment.  This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective
successors and permitted assigns.  No
Party may assign either this Agreement or any of its rights, interests or
obligations hereunder without the prior written approval of the other Party;
provided, that Keane may assign its rights, interests or obligations hereunder
to: (a) a subsidiary, subdivision or affiliate, provided that Keane shall
remain responsible to the Executive for such obligations in the event they are
not met by such assignee; or (b) to a person, corporation, organization or other
entity that acquires (whether by stock purchase or merger or otherwise) all or
substantially all of the business or assets of Keane.


 


12.           Miscellaneous.


 


a.             This Agreement may be amended or modified
only by a written instrument executed by Keane and the Executive.  Notwithstanding anything herein to the
contrary, to the extent that the Executive or Keane reasonably believe that
Section 409A of the Code will result in adverse tax consequences to the
Executive as a result of this Agreement, then the Executive and Keane shall
renegotiate this Agreement in good faith in order to minimize or eliminate such
tax consequences and retain the basic after-tax economics of this Agreement for
the Executive to the extent possible.


 


b.             This Agreement shall be governed by and
construed in accordance with the internal laws (and not the laws of conflicts)
of the Commonwealth of Massachusetts.


 


c.             Except in the case of Section 11 above,
the term “Keane” or the “Company” shall include Keane, Inc. and any of its
subsidiaries, subdivisions and affiliates. 
The captions of the sections of this Agreement are for convenience of
reference only and in no way define, limit or affect the scope or substance of
any section of this Agreement.


 


d.             This Agreement may be executed in
counterparts, each of which shall be deemed to be an original but both of which
together shall constitute one and the same instrument.


 


e.             The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement. If any provision of this Agreement shall
be held invalid or unenforceable in part, the remaining portion of such
provision, together with all other provisions of this Agreement, shall remain
valid and enforceable and continue in full force and effect to the fullest
extent consistent with law.


 


f.              The Executive’s or the Company’s failure
to insist upon strict compliance with any provision of, or to assert any right
under, this Agreement shall not be deemed to be a waiver of such provision or
right or of any other provision of or right under this Agreement.


 


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g.             Keane shall have the right to withhold
all applicable income and employment taxes due with respect to any payment made
to the Executive under this Agreement.


 


Executed this 5th day of August, 2005.


 


 


	
   

  	
  By:

  	
  /s/ Richard Garnick

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Richard Garnick

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Keane, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Russell J. Campanello

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Russell J. Campanello, Sr. Vice President,

  
	
   

  	
   

  	
  Human Resources

  
					



 


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EXHIBIT A


 


Restated Articles of Organization


(General Laws Chapter 156D, Section 10.07;
950 CMR 113.35)


 


Keane, Inc.
(the “Corporation”), having a registered office at 100 City Square, Boston, MA
02129, certifies as follows:


 


FIRST,
the Restated Articles were duly adopted and approved on February 10, 2005
by the board of directors without shareholder approval in the manner required
by General Laws, Chapter 156D and the Articles of Organization of the
Corporation, as amended to date, and shareholder approval was not required.


 


SECOND,
the following is all the information required to be in the original Articles of
Organization, except that the supplemental information provided for in Article VIII
of the Articles of Organization is not included:


 


ARTICLE I.  The exact name of the corporation is Keane, Inc.


 


ARTICLE II.
The purposes for which the corporation is formed are as follows:


 


To
engage in the business of providing consulting and advisory services relating
to the use of data processing and data communication equipment and equipment
associated therewith; and to engage in the business of providing systems design
and computer programming services.


 


ARTICLE III.  The total number of shares of each class of
stock that the corporation is authorized to issue is as follows:


 




	
  TYPE

  	
   

  	
  NUMBER OF SHARES

  AUTHORIZED

  	
   

  	
  PAR VALUE

  	
   

  
	
  Common

  	
   

  	
  200,000,000

  	
   

  	
  $

  	
  .10

  	
   

  
	
  Class B Common

  	
   

  	
  503,797

  	
   

  	
  $

  	
  .10

  	
   

  
	
  Preferred

  	
   

  	
  2,000,000

  	
   

  	
  $

  	
  .01

  	
   

  






 


ARTICLE IV. 
If more than one class or series of shares is authorized, the
preferences, limitations and relative rights of each class or series are as
follows:


 


PART I.                                                     COMMON
STOCK. 


 


A.                                               Dividends,
Combinations and Subdivisions.


 


1.                                       Holders
of Common Stock and Class B Common Stock shall be entitled to receive such
dividends, payable in cash or other as may be declared thereon by the Board of
Directors from time to time out of the assets or funds of the corporation
legally available 


 





















 


therefor, provided that no regular cash quarterly dividend may be
declared and paid to holders of Class B Common Stock unless at the same
time the Board of Directors shall also declare and pay to the holders of Common
Stock a per share dividend which is $.05 per share greater than the per share
dividend declared and paid to holders of Class B Common Stock.  Otherwise, no dividends may be declared or
paid to holders of Class B Common Stock unless equal dividend is declared
and paid to holders of Common Stock.  In
addition, the Board of Directors may declare and pay dividends to the holders
of Common Stock without declaring and paying dividends to the holders of Class B
Common Stock.


 


2.                                       If
the outstanding shares of either the Common Stock or the Class B Common
Stock are changed into, exchanged for or reclassified into a different number,
class or kind of shares of the Corporation or any other corporation or entity
which does not result in the receipt by the Corporation of any new
consideration (other than a transfer of surplus of the Corporation) without
such action being taken on a proportionate basis with respect to the other
class of common stock, whether such change, exchange or reclassification occurs
through a reorganization, recapitalization, stock split or otherwise, then the
requirement that a greater per share dividend be declared and paid with respect
to the Common Stock shall be appropriately and equitably adjusted to reflect
such action.


 


3.                                       The
requirement that a greater per share dividend be declared and paid with respect
to the Common Stock shall not apply (a) to a dividend paid in partial or
complete liquidation of the Corporation, (b) to a special dividend payable
in cash or capital stock or (c) in the event of a dividend payable in any
shares of an existing, or a newly created, class of the Corporation’s capital
stock.  If a dividend payable in any
class of the capital stock of the Corporation is declared on the Common Stock,
the Board of Directors shall also declare a dividend on the Class B Common
Stock payable in shares of the same capital stock of the Corporation equal, on
a per share basis, to the number of shares of capital stock of the Corporation
which are paid to holders of Common Stock. 
If a dividend payable in any class of the capital stock of the
Corporation is declared on the Class B Common Stock, the board shall also
declare a dividend on the Common Stock payable in shares of the same capital
stock of the Corporation, equal, on a per share basis, to the number of shares
of capital stock of the Corporation which are paid to holders of Class B
Common Stock.


 


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B.                                                 Voting.


 


1.                                       Except
as expressly provided herein, at every meeting of stockholders of the
Corporation, every holder of Common Stock shall be entitled to one vote in
person or by proxy for each share of Common Stock standing in his name on the
transfer books of the Corporation and every holder of Class B Common Stock
shall be entitled to ten votes in person or by proxy for each share of Class B
Common Stock standing in his name on the transfer books of the Corporation.


 


2.                                       Except
as may otherwise be required by law or by this Article 4, the holders of
Common Stock and Class B Common Stock shall vote together as a single
class.


 


C.                                                 Conversion.


 


1.                                       Each
share of Class B Common Stock may at any time be converted into one fully
paid and nonassessable share of Common Stock. 
Such right of conversion shall be exercised by the surrender of the
certificate representing such share of Class B Common Stock to be
converted to the Corporation at any time during normal business hours at the
principal executive offices of the Corporation, or if an agent for the
registration of transfer of shares of Class B Common Stock is then duly
appointed and acting (said agent being hereinafter called the “Transfer Agent”)
then at the office of the Transfer Agent, accompanied by a written notice of
the election by the holder thereof to convert and (if so required by the
Corporation or the Transfer Agent) by instruments of transfer, in form
satisfactory to the Corporation and to the Transfer Agent, duly executed by
such holder or his duly authorized attorney, and transfer tax stamps or funds
therefor, if required pursuant to subparagraph (5) below.


 


2.                                       As
promptly as practicable after the surrender for conversion of a certificate
representing shares of Class B Common Stock in the manner provided in
subparagraph (1) above and the payment in cash of any amount required by
the provisions of subparagraphs (1) and (5), the Corporation will deliver
or cause to be delivered at the office of the Transfer Agent to, or upon the
written order of, the holder of such certificate a certificate or certificates
representing the number of full shares of Common Stock issuable upon such
conversion, issued in such name or names as such holder may direct.  Such conversion shall be deemed to have been
made immediately prior to the close of business on the date of the 


 


3





















 


surrender of the certificate representing shares of Class B Common
Stock, and all rights of the holder of such shares as such holder shall cease
at such time and the person or persons in whose name or names the certificate
or certificates representing the shares of Common Stock are to be issued shall
be treated for all purposes as having become the record holder or holders of
such shares of Common Stock at such time; provided, however, that any such
surrender and payment on any date when the stock transfer books of the
Corporation shall be closed shall constitute the person or persons in whose
name or names the certificate or certificates representing shares of Common
Stock are to be issued as the record holder or holders thereof for all purposes
immediately prior to the close of business on the next succeeding day on which
such stock transfer books are open.


 


3.                                       No
adjustments in respect of dividends shall be made upon the conversion of any
share of Class B Common Stock, provided, however, that if a share shall be
converted after the record date for the payment of a dividend or other
distribution on shares of Class B Common Stock but before such payment,
the registered holder of such share at the close of business on such record
date shall be entitled to receive the dividend or other distribution payable on
such share on the date set for payment of such dividend or other distribution
notwithstanding the conversion of such share or the Corporation’s default in
payment of the dividend due on such date.


 


4.                                       The
Corporation covenants that it will at all times reserve and keep available,
solely for the purpose of issuance upon conversion of the outstanding shares of
Class B Common Stock, such number or shares of Common Stock as shall be
issuable upon the conversion of all such outstanding shares, provided that
nothing contained in these Articles shall be construed to preclude the
Corporation from satisfying its obligations in respect of the conversion of the
outstanding shares of Class B Common Stock by delivery of purchased shares
of Common Stock which are held in the treasury of the Corporation.  The Corporation covenants that if any shares
of Common Stock required to be reserved for purposes of conversion hereunder
require registration with or approval of any government authority under any
federal or state law before such shares of Common Stock may be issued upon
conversion, the Corporation will cause such shares to be duly registered or
approved, as the case may be.  The
Corporation covenants that all shares of Common Stock which shall be issued
upon conversion of the shares of Class B Common Stock will, upon issue, be
fully paid and nonassessable and not subject to any preemptive rights.


 


4





















 


5.                                       The
issuance of certificates for shares of Common Stock upon conversion of shares
of Class B Common Stock shall be made without charge for any stamp or other
similar tax in respect of such issuance. 
However, if any such certificate is to be issued in a name other than
that of the holder of the share or shares of Class B Common Stock
converted, the person or persons requesting the issuance thereof shall pay to
the Corporation the amount of any tax which may be payable in respect of any
transfer involved in such issuance or shall establish to the satisfaction of
the Corporation that such tax has been paid.


 


6.                                       At
any time while there are shares of Class B Common Stock issued and
outstanding, the Board of Directors of the Corporation may, in its sole
discretion, by a majority vote of the Directors then in office convert all
outstanding shares of Class B Common Stock into Common Stock on a share
for share basis.  Notice of automatic
conversion of Class B Common Stock specifying the date fixed for said
conversion shall be mailed, postage prepaid, at least 20 days but not more
than 30 days prior to said conversion date to the holders of record of the Class B
Common Stock at their respective addresses as the same shall appear on the
books of the Corporation.  Following the
expiration of such notice period, each outstanding share of Class B Common
Stock shall be deemed to be a share of Common Stock for all purposes.


 


D.                                                Distribution
of Assets.


 


1.                                       If
the Corporation shall be liquidated, dissolved or wound up, whether voluntarily
or involuntarily, the holders of the Class B Common Stock shall be
entitled to share ratably with the holders of the Common Stock of the Corporation
as a single class in the net assets of the Corporation; that is, an equal
amount of net assets for each share of Common Stock and Class B Common
Stock.  A merger or consolidation of the
Corporation with or into any other corporation or sale or conveyance of all or
any part of the assets of the Corporation (which shall not in fact result in
the liquidation of the Corporation and the distribution of assets to
stockholders) shall not be deemed to be a voluntary or involuntary liquidation
or dissolution or winding up of the Corporation within the meaning of this
subparagraph (D).


 


5





















 


E.                                                  Authorized
Shares; Fractional Shares.


 


1.                                       The
number of authorized shares of Class B Common Stock may not be increased
unless approved by the holders of a majority of the then outstanding shares of
Common Stock.


 


2.                                       No
fractional shares of Common Stock shall be issued upon conversion of shares of Class B
Common Stock.  In lieu of fractional
shares, the Transfer Agent shall pay an amount in cash equal to the closing
market price of the shares of Common Stock on the conversion date multiplied by
the fraction of a share of Common Stock that would otherwise be issuable.


 


PART II.                                                 PREFERRED
STOCK. 


 


Preferred Stock may be issued from time to time in one or more series,
each of such series to have such terms as stated or expressed herein and in the
resolution or resolutions providing for the issue of such series adopted by the
Board of Directors of the Corporation as hereinafter provided.  Any shares of any series of Preferred Stock
which may be redeemed, purchased or acquired by the Corporation may be reissued
as shares of the same series or as shares of one or more other series of
Preferred Stock except as otherwise provided by law.  Different series of Preferred Stock shall not
be construed to constitute different classes of shares for the purposes of
voting by classes unless expressly provided.


 


Authority is hereby expressly granted to the Board of Directors from
time to time to issue the Preferred Stock in one or more series, and in
connection with the creation of any such series, by resolution or resolutions
providing for the issue of the shares thereof, to determine and fix such voting
powers, full or limited, or no voting powers, and such designations,
preferences and relative participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, including without
limitation dividend rights, conversion rights, redemption privileges and
liquidation preferences, as shall be stated and expressed in such resolutions,
all to the full extent now or hereafter permitted by the Massachusetts Business
Corporation Law.  Without limiting the
generality of the foregoing, the resolutions providing for issuance of any
series of Preferred Stock may provide that such series shall be superior or
rank equally or be junior to the Preferred Stock of any other series to the
extent permitted by law.


 


ARTICLE V.  The restrictions
imposed by the Articles of Organization upon the transfer of shares of any
class or series of stock are as follows:


 


A.                                   No
person holding shares of Class B Common Stock (a “Class B Holder”)
may transfer, except by gift, devise or bequest, a transfer to the estate of a
stockholder upon the death of such stockholder or a transfer of shares held in
a trust to the grantor of such trust or to any person to whom or for whose
benefit the principal of such trust may be distributed, and the Corporation and
the Transfer Agent shall not register the transfer of such shares of Class B
Common Stock, whether by sale, assignment, appointment or otherwise.  Any purported transfer of shares of


 


6





















 


Class B Common Stock, other than a transfer of the type described
above, shall be null and void and of no effect and the purported transfer by a Class B
Holder will result in the immediate and automatic conversion of the shares of Class B
Common Stock held by such Class B Holder into shares of Common Stock.  The purported transferee shall have no rights
as a stockholder of the Corporation and no other rights against, or with
respect to, the Corporation except the right to receive shares of Common Stock
upon the immediate and automatic conversion of his shares of Class B
Common Stock into shares of Common Stock. 
The estate of any deceased stockholder, a transferee upon the
distribution of the assets of such an estate, any transferee of the Class B
Common Stock by gift, devise or bequest or a transferee from a trust of which
such transferee was the grantor or a principal beneficiary shall hold the
transferred shares of Class B Common Stock subject to the same
restrictions on transferability as apply to all Class B Holders under this
Article V.


 


B.                                     Shares
of Class B Common Stock shall be registered in the name(s) of the
beneficial owner(s) thereof (as hereafter defined) and not in “street” or “nominee”
names; provided, however, certificates representing shares of Class B
Common Stock issued as a stock dividend on the Corporation’s then outstanding
Common Stock may be registered in the same name and manner as the certificates
representing the shares of Common Stock with respect to which the shares of Class B
Common Stock are issued.  For the
purposes of this paragraph (B) the term “beneficial owner(s)” of any
shares of Class B Common Stock shall mean the person or persons who
possess the power to dispose, or to direct the deposition, of such shares.  Any shares of Class B Common Stock
registered in “street” or “nominee” name may be transferred to the beneficial
owner of such shares on the record date for such stock dividend, upon proof
satisfactory to the Corporation and the Transfer Agent that such person was in
fact the beneficial owner of such shares on the record date for such stock dividend.


 


C.                                     Notwithstanding
anything to the contrary in this Article V, any Class B Holder may
pledge such holder’s shares of Class B Common Stock to a pledgee pursuant
to a bona fide pledge of such shares as collateral security for indebtedness
due to the pledge, provided that such shares shall not be transferred to, or
registered in the name of, the pledgee and shall remain subject to the
provisions of this subparagraph (C) of Article V.  In the event of foreclosure or other similar
action by the pledgee, such pledged shares of Class B Common Stock may not
be transferred to the pledgee and may only be converted into shares of Common
Stock.


 


D.                                    The
Corporation shall note on the certificates representing the shares of Class B
Common Stock the restrictions on transfer and registration of transfer imposed
by this Article V.


 


7





















 


E.                                      For
purposes of this Article V:


 


(i)                                     Each
joint owner of shares of Class B Common Stock shall be considered a Class B
Holder of such shares.


 


(ii)                                  A
minor for whom shares of Class B Common Stock are held pursuant to a
Uniform Gifts to Minors Act or similar law shall be considered a Class B
Holder of such shares.


 


(iii)                               Unless
otherwise specified, the term “person” includes a natural person, corporation,
partnership, unincorporated association, firm, joint venture, trust or other
entity.


 


(iv)                              Persons
participating in a Thrift or Employee Stock Ownership Plan of the Corporation
(or any similar or successor plans) shall be deemed to be the Class B
Holders of the shares of Class B Common Stock allocated to their accounts
pursuant to such plans.


 


ARTICLE VI. 
Other lawful provisions:


 


A.                                   Limitation
of Liability of Directors for Monetary Damages. To the fullest extent
permitted by Chapter 156D of the General Laws of Massachusetts (“Chapter 156D”),
as it exists or may be amended, a director of this Corporation shall not be
personally liable to the Corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, notwithstanding any provision of
law imposing such liability. No amendment to, or repeal of, this provision
shall apply to or have any effect on the liability or alleged liability of any
director of the Corporation for or with respect to any acts or omissions of
such director occurring prior to such amendment or repeal.


 


B.                                     Indemnification.


 


1.                                       Actions,
Suits and Proceedings.  The
Corporation shall indemnify each person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was, or has agreed to become, a director or officer
of the Corporation, or is or was serving, or has agreed to serve, at the request
of the Corporation, as a director or officer of, or in a similar capacity with,
another organization or in any capacity with respect to any employee benefit
plan of the Corporation (all such persons being referred to hereafter as an “Indemnitee”),
or by reason of any action alleged to have been taken or omitted in such
capacity, against all expenses (including attorneys’ fees), judgments and fines
incurred by him or on his behalf in connection with such action, suit or
proceeding and any appeal therefrom, unless the Indemnitee shall be finally
adjudicated in such action, suit or proceeding not to have acted in good faith
in the reasonable belief that his action was in the best interests of the
Corporation or, to the extent such matter relates to service with respect to an
employee benefit plan, in the best interests of 


 


8





















 


the participants or beneficiaries of such employee benefit plan.  Notwithstanding anything to the contrary in
this Article, except as set forth in Section 5 below, the Corporation
shall not indemnify an Indemnitee seeking indemnification in connection with a
proceeding (or part thereof) initiated by the Indemnitee unless the initiation
thereof was approved by the Board of Directors of the Corporation.


 


2.                                       Settlements.  The right to indemnification conferred in
this Article shall include the right to be paid by the Corporation for
amounts paid in settlement of any such action, suit or proceeding and any
appeal therefrom, and all expenses (including attorneys’ fees) incurred in
connection with such settlement, pursuant to a consent decree or otherwise,
unless and to the extent it is determined pursuant to Section 5 below that
the Indemnitee did not act in good faith in the reasonable belief that his
action was in the best interests of the Corporation or, to the extent such
matter relates to service with respect to an employee benefit plan, in the best
interests of the participants or beneficiaries of such employee benefit plan.


 


3.                                       Notification
and Defense of Claim.  As a condition
precedent to his right to be indemnified, the Indemnitee must notify the
Corporation in writing as soon as practicable of any action, suit, proceeding
or investigation involving him for which indemnity will or could be
sought.  With respect to any action,
suit, proceeding or investigation of which the Corporation is so notified, the
Corporation will be entitled to participate therein at its own expense and/or
to assume the defense thereof at its own expense, with legal counsel reasonably
acceptable to the Indemnitee.  After
notice from the Corporation to the Indemnitee of its election so to assume such
defense, the Corporation shall not be liable to the Indemnitee for any legal or
other expenses subsequently incurred by the Indemnitee in connection with such
claim, other than as provided below in this Section 3.  The Indemnitee shall have the right to employ
his own counsel in connection with such claim, but the fees and expenses of
such counsel incurred after notice from the Corporation of its assumption of
the defense thereof shall be at the expense of the Indemnitee unless (i) the
employment of counsel by the Indemnitee has been authorized by the Corporation,
(ii) counsel to the Indemnitee shall have reasonably concluded that there
may be a conflict of interest or position on any significant issue between the
Corporation and the Indemnitee in the conduct of the defense of such action or (iii) the
Corporation shall not in fact have employed counsel to assume the defense of
such action, in each of which cases the fees and expenses of counsel for the
Indemnitee shall be at the expense of the Corporation, except as otherwise
expressly provided by this Article.  The
Corporation shall not be entitled to assume the defense of any claim brought by
or in the right of the Corporation, or as to which counsel for the Indemnitee
shall have reasonably made the conclusion provided for in clause (ii) above.


 


9





















 


4.                                       Advance
of Expenses.  Subject to the
provisions of Section 5 below, in the event that the Corporation does not
assume the defense pursuant to Section 3 of this Article of any
action, suit, proceeding or investigation of which the Corporation receives
notice under this Article, any expenses (including attorneys’ fees) incurred by
an Indemnitee in defending a civil or criminal action, suit, proceeding or
investigation or any appeal therefrom shall be paid by the Corporation in
advance of the final disposition of such matter, provided, however,
that the payment of such expenses incurred by an Indemnitee in advance of the
final disposition of such matter shall be made only upon receipt of an
undertaking by or on behalf of the Indemnitee to repay all amounts so advanced
in the event that it shall ultimately be determined that the Indemnitee is not
entitled to be indemnified by the Corporation as authorized in this
Article.  Such undertaking may be
accepted without reference to the financial ability of the Indemnitee to make
such repayment.


 


5.                                       Procedure
for Indemnification.  In order to
obtain indemnification or advancement of expenses pursuant to Section 1, 2
or 4 of this Article, the Indemnitee shall submit to the Corporation a written
request, including in such request such documentation and information as is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification or
advancement of expenses.  Any such indemnification
or advancement of expenses shall be made promptly, and in any event within 60
days after receipt by the Corporation of the written request of the Indemnitee,
unless the Corporation determines, by clear and convincing evidence, within
such 60-day period that the Indemnitee did not meet the applicable standard of
conduct set forth in Section 1 or 2, as the case may be.  Such determination shall be made in each
instance by (a) a majority vote of a quorum of the directors of the
Corporation, (b) a majority vote of a quorum of the outstanding shares of
stock of all classes entitled to vote for directors, voting as a single class,
which quorum shall consist of stockholders who are not at that time parties to
the action, suit or proceeding in question, (c) independent legal counsel
(who may be regular legal counsel to the Corporation), or (d) a court of
competent jurisdiction.


 


6.                                       Remedies.  The right to indemnification or advances as
granted by this Article shall be enforceable by the Indemnitee in any
court of competent jurisdiction if the Corporation denies such request, in
whole or in part, or if no disposition thereof is made within the 60-day period
referred to above in Section 5. 
Unless otherwise provided by law, the burden of proving that the
Indemnitee is not entitled to indemnification or advancement of expenses under
this Article shall be on the Corporation. 
Neither the failure of the Corporation to have made a determination
prior to the commencement of such action that indemnification is proper in the
circumstances because the Indemnitee has met the applicable standard of
conduct, nor an actual determination by the Corporation pursuant to


 


10





















 


Section 5 that the Indemnitee has not met such applicable standard
of conduct, shall be a defense to the action or create a presumption that the
Indemnitee has not met the applicable standard of conduct.  The Indemnitee’s expenses (including
attorneys’ fees) incurred in connection with successfully establishing his
right to indemnification, in whole or in part, in any such proceeding shall
also be indemnified by the Corporation.


 


7.                                       Subsequent
Amendment.  No amendment, termination
or repeal of this Article or of the relevant provisions of Chapter 156D or
any other applicable laws shall affect or diminish in any way the rights of any
Indemnitee to indemnification under the provisions hereof with respect to
action, suit, proceeding or investigation arising out of or relating to any
actions, transactions or facts occurring prior to the final adoption of such
amendment, termination or repeal.


 


8.                                       Other
Rights.  The indemnification and
advancement of expenses provided by this Article shall not be deemed
exclusive of any other rights to which an Indemnitee seeking indemnification or
advancement of expenses may be entitled under any law (common or statutory),
agreement or vote of stockholders or directors or otherwise, both as to action
in his official capacity and as to action in any other capacity while holding
office for the Corporation, and shall continue as to an Indemnitee who has
ceased to be a Director or officer, and shall inure to the benefit of the
estate, heirs, executors and administrators of the Indemnitee.  Nothing contained in this Article shall
be deemed to prohibit, and the Corporation is specifically authorized to enter
into, agreements with officers and directors providing indemnification rights
and procedures different from those set forth in this Article.  In addition, the Corporation may, to the
extent authorized from time to time by its Board of Directors, grant
indemnification rights to other employees or agents of the Corporation or other
persons serving the Corporation and such rights may be equivalent to, or
greater or less than, those set forth in this Article.


 


9.                                       Partial
Indemnification.  If an Indemnitee is
entitled under any provision of this Article to indemnification by the
Corporation for some or a portion of the expenses (including attorneys’ fees),
judgments, fines or amounts paid in settlement actually and reasonably incurred
by him or on his behalf in connection with any action, suit, proceeding or
investigation and any appeal therefrom but not, however, for the total amount
thereof, the Corporation shall nevertheless indemnify the Indemnitee for the
portion of such expenses (including attorneys’ fees), judgments, fines or
amounts paid in settlement to which the Indemnitee is entitled.


 


10.                                 Insurance.  The Corporation may purchase and maintain
insurance, at its expense, to protect itself and any director, officer, employee
or agent of the Corporation or another organization or employee benefit plan
against any expense, liability or loss incurred by him in any such capacity, or


 


11





















 


arising out of his status as such, whether or not the Corporation would
have the power to indemnify such person against such expense, liability or loss
under Chapter 156D.


 


11.                                 Merger
or Consolidation.  If the Corporation
is merged into or consolidated with another corporation and the Corporation is
not the surviving corporation, the surviving corporation shall assume the
obligations of the Corporation under this Article with respect to any
action, suit, proceeding or investigation arising out of or relating to any
actions, transactions or facts occurring prior to the date of such merger or
consolidation.


 


12.                                 Savings
Clause.  If this Article or any
portion hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless indemnify each Indemnitee
as to any expenses (including attorneys’ fees), judgments, fines and amounts
paid in settlement in connection with any action, suit, proceeding or
investigation, whether civil, criminal or administrative, including an action
by or in the right of the Corporation, to the fullest extent permitted by any
applicable portion of this Article that shall not have been invalidated
and to the fullest extent permitted by applicable law.


 


13.                                 Subsequent
Legislation.  If the Massachusetts
General Laws are amended after adoption of this Article to expand further
the indemnification permitted to Indemnitees, then the Corporation shall
indemnify such persons to the fullest extent permitted by the Massachusetts
General Laws, as so amended.


 


14.                                 Amendments
to Articles.  Notwithstanding any
other provisions of law, these Articles of Organization or the By-Laws of the
Corporation, and notwithstanding the fact that a lesser percentage may be
specified by law, the affirmative vote of at least sixty-six and two-thirds
percent (66 2/3%) of the votes which all the stockholders would be
entitled to cast at any annual election of directors or class or directors
shall be required to amend or repeal, or to adopt any provision inconsistent
with, this Article 6B.


 


C.                                     Authorization
of Directors to Make, Amend or Repeal Bylaws. The directors may make, amend
or repeal the bylaws in whole or in part, except with respect to any provision
thereof which by law or the bylaws of the corporation requires action by the
stockholders.


 


ARTICLE VII. 
The effective date of this restatement of the Articles of Organization
is the date and time these Restated Articles were received for filing.


 


12





















 


THIRD, No Articles of the Articles of Organization of
the corporation are being amended by these Restated Articles.


 


 


	
  Signed by

  	
  /s/ C. Whitney Pedersen

  	
   

  	
   

  	
   

  	
   

  
	
  (signature of
  authorized individual)

  	
   

  	
   

  	
   

  	
   

  



 


 


	
  (Please check appropriate box)

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Chairman of the Board of Directors

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
  ý

  	
   

  	
  Other Officer

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Court-appointed fiduciary,

  



 


Signed on this 10th
day of May 2005.


 


13





















 


COMMONWEALTH OF MASSACHUSETTS


 


William Francis Galvin


Secretary of the Commonwealth


One Ashburton Place, Boston, Massachusetts 02108-1512


 


Restated Articles of Organization


(General Laws, Chapter 156D, Section 10.07)


 


I
hereby certify that upon examination of these Restated Articles of
Organization, duly submitted to me, it appears that the provisions of the
General Laws relative to the organization of corporations have been complied
with, and I hereby approve said articles; and the filing fee in the amount of $
200 having been paid, said articles are deemed to have been filed with me this
16th  day of May, 2005 at 3:44 p.m.

                   time


 


	
  Effective date:

  	
   

  
	
   

  	
  (must be within 90 days of date
  submitted)

  



 


	
  WILLIAM FRANCIS GALVIN

  
	
  Secretary of the Commonwealth

  
	
   

  
	
   

  	
  /s/ William Francis Galvin

  	
   

  



 


Contact information to be filled in by corporation:


 


C. Whitney Pedersen


100 City Square, Boston, MA 02129


Telephone:  (617) 241-9200


Email:  charles_w_pedersen@keane.com


 










 













 


EXHIBIT B


 





 


Keane, Inc.


 


 


Incentive
Stock Option Agreement


Granted
Under 1998 Stock Incentive Plan


 


1.                                       Grant
of Option.


 


This agreement evidences the grant by Keane, Inc.,
a Massachusetts corporation (the “Company”), on
            ,
     (the “Grant Date”) to
                    
(the “Participant”), an employee of the Company or one of its wholly-owned
subsidiaries, as defined in Section 424(f) of the Internal Revenue
Code of 1986, as amended and any regulations promulgated thereunder (the “Code”),
of an option to purchase, in whole or in part, on the terms provided herein and
in the Company’s 1998 Stock Incentive Plan (the “Plan”), a total of        shares of
common stock, $.10 par value per share, of the Company (“Common Stock”) (the “Shares”)
at $      per Share. 
Unless earlier terminated, this option shall expire on, and cannot be
exercised on or after, the tenth anniversary of the Grant Date (the “Expiration
Date”).


 


It is intended that the option evidenced by
this agreement shall be an incentive stock option as defined in Section 422
of the Code.  For so long as the Code
shall so provide, options granted to any employee which are intended to
constitute incentive stock options shall not constitute incentive stock options
to the extent that such options, in the aggregate, become exercisable for the
first time in any one calendar year for shares of Common Stock with an
aggregate fair market value (determined as of the respective date or dates of
grant) of more than $100,000.  Any shares
granted above the $100,000 limit are considered non-qualified stock
options.  Except as otherwise indicated
by the context, the term “Participant”, as used in this option, shall be deemed
to include any person who acquires the right to exercise this option validly
under its terms.


 


2.             Vesting
Schedule.


 


 Except
as otherwise provided in this Agreement, this option shall become fully
exercisable as to all of the Shares on the fifth anniversary of the Grant Date
(the “Fifth Anniversary Date”). 
Notwithstanding the foregoing, if prior to the Fifth Anniversary Date
the Company shall file with the Securities and Exchange Commission an Annual
Report on Form 10-K cash EPS for any fiscal year following year 2000 greater
than or equal to any of the cash EPS targets set forth below,


 


1





















 


then this option shall, upon
filing of such Form 10-K, immediately become exercisable as to not more than
the number of shares set forth opposite such EPS target in the table below.


 


	
  Cash EPS Target

  	
   

  	
  Number of

  Shares as to which

  Option is Exercisable

  	
   

  
	
  EPS = $1.00

  	
   

  	
  34% of total number of Shares

  	
   

  
	
  EPS = $1.50

  	
   

  	
  67% of total number of Shares

  	
   

  
	
  EPS = $2.00

  	
   

  	
  100% of total number of Shares

  	
   

  



 


The right of exercise shall be cumulative so
that to the extent the option is not exercised at any time to the maximum
extent permissible it shall continue to be exercisable, in whole or in part,
with respect to all Shares for which it is vested until the earlier of the
Expiration Date or the termination of this option under Section 3 hereof
or the Plan.


 


3.             Exercise
of Option.


 


(a)           Form of
Exercise.  Each election to exercise
this option shall be in writing specifying the number of Shares to be
exercised, the option exercise price per Share and delivery instructions for
the Shares, signed by the Participant, and received by the Company at its
principal office, accompanied by payment in full as follows:


 


(i)                                     in
cash or by check, payable to the order of the Company; or


 


(ii)                                  by delivery of cash or a check equal to
the exercise price of the options by a creditworthy broker;


 


(iii)                               by delivery of shares of Common Stock owned by the
Participant valued at their fair market value as determined by (or in a manner
approved by) the Board in good faith, with written proof that the Common Stock
was owned by the Participant at least twelve months prior to such delivery; or


 


(iv)                              by
any combination of the above permitted forms of payment.


The Participant may
purchase less than the number of shares covered hereby, provided that no
partial exercise of this option may be for any fractional share or for fewer
than ten whole shares.


 


(b)           No Special
Employment Rights; Agreement Not To Compete.  Nothing contained in the Plan shall be
construed or deemed by any person under any circumstances to bind the Company
to continue the employment of the Participant for the period within which this
option


 


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may be
exercised.  The Company expressly
reserves the right at any time to dismiss or otherwise terminate its
relationship with a Participant free from any claim under the Plan.  In consideration of the benefits herein
conferred, the Participant hereby agrees and covenants with the Company that
for a period of one (1) year following any termination of his or her
employment with the Company he or she (i) will not hire, attempt to hire,
solicit, or attempt to solicit to hire, or assist another or participate in any
manner in the hiring or soliciting for hire, of any person employed by Keane
within the one (1) year prior to the termination of his or her employment;
and (ii) will not “compete” with Keane. 
For purposes of the Agreement, “competing” is defined as soliciting or
doing business with, directly or indirectly, any present or past customer of
Keane, or any prospective customer of Keane, with whom he or she has had
contact in connection with any business activity. 


 


(c)           Continuous
Relationship with the Company Required. 
Except as otherwise provided in this Section 3, this option may not
be exercised unless the Participant, at the time he or she exercises this
option, is, and has been at all times since the date of grant of this option,
an employee, officer or director of, or consultant or advisor to, the Company
or any parent or subsidiary of the Company as defined in Section 424(e) or
(f) of the Code (an “Eligible Participant”).


 


(d)           No Rights As
Stockholder.  No Participant shall
have any rights as a stockholder with respect to any shares of Common Stock to
be distributed with respect to this option (including, without limitation, any
rights to dividends or distributions) until becoming the record holder of such
shares.  Notwithstanding the foregoing,
in the event the Company effects a split of the Common Stock by means of a
stock dividend and the exercise price of and the number of shares subject to
this option are adjusted as of the date of the distribution of the dividend
(rather than as of the record date for such dividend), then if the Participant
exercises this option between the close of business on the record date for such
stock dividend and the close of business on the distribution date for such
stock dividend, he or she shall be entitled to receive, on the distribution
date, the stock dividend with respect to the shares of Common Stock acquired
upon such option exercise, notwithstanding the fact that such shares were not
outstanding as of the close of business on the record date for such stock
dividend.


 


(e)           Termination of
Relationship with the Company.  If
the Participant ceases to be an Eligible Participant for any reason, then,
except as provided in paragraphs (f) and (g) below, the right to
exercise this option shall terminate forty-five (45) days after such cessation
(but in no event after the Expiration Date), provided  that this
option shall be exercisable only to the extent that the Participant was
entitled to exercise this option on the date of such cessation.  Notwithstanding the foregoing, if the
Participant, prior to the Expiration Date, violates the non-competition or
confidentiality provisions of any employment contract, confidentiality and
nondisclosure agreement or other agreement between the Participant and the
Company, the right to exercise this option shall terminate immediately upon
written notice to the Participant from the Company describing such violation.


 


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(f)            Exercise Period
Upon Death or Disability.  If the
Participant dies or becomes disabled (within the meaning of Section 22(e)(3) of
the Code) prior to the Final Exercise Date while he or she is an Eligible
Participant and the Company has not terminated such relationship for “cause” as
specified in paragraph (g) below, this option shall be exercisable, within
the period of one year following the date of death or disability of the Participant
by the Participant, provided  that this option shall be
exercisable only to the extent that this option was exercisable by the
Participant on the date of his or her death or disability, and further provided
that this option shall not be exercisable after the Expiration Date.


 


(g)           Discharge for Cause.  If the Participant, prior to the Expiration
Date, is discharged by the Company for “cause” (as defined below), the right to
exercise this option shall terminate immediately upon the effective date of
such discharge. “Cause” shall mean misconduct by the Participant or willful
failure by the Participant to perform his or her responsibilities to the
Company in the best interests of the Company (including, but not limited to,
breach by the Participant of any provision of any employment, consulting,
advisory, nondisclosure, non-competition or other similar agreement between the
Participant and the Company), as determined by the Company, which determination
shall be conclusive.  The Participant
shall be considered to have been discharged for “Cause” if the Company
determines, within 30 days after the Participant’s resignation, that discharge
for cause was warranted.


 


(h)           Changes in
Capitalization.  In the event of any
stock split, reverse stock split, stock dividend, recapitalization, combination
of shares, reclassification of shares, spin-off or other similar change in
capitalization or event, or any distribution to holders of Common Stock other
than a normal cash dividend, in each case other than an Acquisition Event (as
defined in the Plan), the number and class of securities and exercise price per
share subject to this option shall be appropriately adjusted by the Company to
the extent the Board shall determine, in good faith, that such an adjustment
(or substitution) is necessary and appropriate.


 


4.             Withholding.  No Shares will be issued pursuant to the
exercise of this option unless and until the Participant pays to the Company,
or makes provision satisfactory to the Company for payment of, any federal, state
or local withholding taxes required by law to be withheld in respect of this
option.


 


5.             Nontransferability
of Option.  This option may not be
sold, assigned, transferred, pledged or otherwise encumbered by the
Participant, either voluntarily or by operation of law, except by will or the
laws of descent and distribution, and, during the lifetime of the Participant,
this option shall be exercisable only by the Participant.


 


6.             Disqualifying
Disposition.  If the Participant
disposes of Shares acquired upon exercise of this option within two years from
the date of grant of the option or one year after such Shares were acquired
pursuant to exercise of this option, the Participant shall notify the Company
in writing of such disposition within 30 days of such disposition.


 


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7.             Provisions
of the Plan.   This option is subject
to the provisions of the Plan, a copy of which is furnished to the Participant
with this option.


 


IN WITNESS WHEREOF, the Company has caused
this option to be executed under its corporate seal by its duly authorized
officer.  This option shall take effect
as a sealed instrument.


 


 


	
   

  	
  KEANE, INC.

  
	
   

  	
   

  
	
   

  	
  s/s Brian T. Keane

  	
   

  



 


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PARTICIPANT’S
ACCEPTANCE


 


The undersigned hereby accepts the foregoing
option and agrees to the terms and conditions thereof.  The undersigned hereby acknowledges receipt
of a copy of the Company’s 1998 Stock Incentive Plan.


 


 


	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name (please print):

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						



 


 


I have read the terms and conditions of the
foregoing option and choose NOT TO ACCEPT the option agreement.


 


	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name (please print):

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						



 


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EXHIBIT C


DEFINITION OF “CHANGE IN CONTROL”


 


“Change
in Control” shall mean any of the following:


 


(a)                                    any “person,” as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the “Act”) (other than the
Company, any of its subsidiaries, or any trustee, fiduciary or other person or
entity holding securities under any employee benefit plan or trust of the
Company or any of its subsidiaries), together with all “affiliates” and “associates”
(as such terms are defined in Rule 12b-2 under the Act) of such person,
shall become the “beneficial owner” (as such term is defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of either (A) the combined voting
power of the Company’s then outstanding securities having the right to vote in
an election of the Company’s Board (“Voting Securities”) or (B) the then
outstanding shares of Company’s common stock (“Common Stock”) (other than as a
result of an acquisition of securities directly from the Company); or


 


(b)                                   During any period of two years or less, persons who at the beginning of
such period (the “Commencement Date”) constitute the Company’s Board (the “Incumbent
Directors”) cease for any reason, including, without limitation, as a result of
a tender offer, proxy contest, merger or similar transaction, to constitute at
least a majority of the Board, provided that any person becoming a director of
the Company subsequent to the Commencement Date shall be considered an
Incumbent Director if such person’s election was approved by or such person was
nominated for election by a vote of at least a majority of the Incumbent
Directors; but provided further, that any such person whose initial assumption
of office is in connection with an actual or threatened election contest
relating to the election of members of the Board or other actual or threatened
solicitation of proxies or consents by or on behalf of a person other than the
Board, including by reason of agreement intended to avoid or settle any such
actual or threatened contest or solicitation, shall not be considered an
Incumbent Director; or


 


(c)                                    the stockholders of the Company shall approve (A) any
consolidation or merger of the Company where the stockholders of the Company,
immediately prior to the consolidation or merger, would not, immediately after
the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3
under the Act), directly or indirectly, shares representing in the aggregate
fifty percent (50%) or more of the voting shares of the Company issuing cash or
securities in the consolidation or merger (or of its ultimate parent
corporation, if any), (B) any sale, lease, exchange or other transfer (in
one transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of the
Company or (C) any plan or proposal for the liquidation or dissolution of
the Company.


 





















 


Notwithstanding the foregoing, a “Change of Control”
shall not be deemed to have occurred for purposes of the foregoing clause (a) solely
as the result of an acquisition of securities by the Company which, by reducing
the number of shares of Common Stock or other Voting Securities outstanding,
increases the proportionate number of shares beneficially owned by any person
to fifty percent (50%) or more of either (A) the combined voting power of
all of the then outstanding Voting Securities or (B) Common Stock; provided,
however, that if any person referred to in this sentence shall thereafter
become the beneficial owner of any additional shares of Voting Securities or
Common Stock (other than pursuant to a stock split, stock dividend, or similar
transaction or as a result of an acquisition of securities directly from the
Company) and immediately thereafter beneficially owns fifty percent (50%) or
more of either (A) the combined voting power of all of the then
outstanding Voting Securities or (B) Common Stock, then a “Change of
Control” shall be deemed to have occurred for purposes of the foregoing clause
(a).


 





















 


Exhibit D


AGREEMENT


 


This Agreement (“Agreement”) is by
and between Keane, Inc. (“Keane”) and the employee named below and is
effective on the date of execution by both parties.


 


I understand that Keane is involved
in an extremely competitive industry in which information and knowledge are
valuable assets that must be protected.


 


I also understand that this
Agreement seeks to protect these assets, as well as other legitimate business
interests, by addressing the issues of non-disclosure of confidential and/or
proprietary information and trade secrets; rights in inventions; and employee
obligations and restrictive covenants.


 


I understand the meaning and effect
of the terms of this Agreement, and understand that agreement to the terms set
forth herein is a condition of my employment or continued employment with
Keane.


 


NOW, THEREFORE, in
consideration of the covenants herein and for other good and valuable consideration,
I hereby agree with Keane as follows:


 


Employment with Keane


 


1.     I
understand and agree that any subsequent change or changes in my employment,
including but not limited to change or changes to my title, duties,
responsibilities, compensation, benefits, reporting relationships and/or term
of my employment, shall not in any way affect the validity of this Agreement,
which shall be and remain in full force and effect.


 


Trade Secrets, Confidential Information and
Keane Property.


 


2.     I
acknowledge that my employment with Keane has given or will give me access to
certain trade secrets and confidential and/or proprietary information belonging
to Keane including, but not limited to, non-public information pertaining to
current or former employees, information pertaining to hires, prospective hires
or potential hires, reports, customer lists, customer prospect material, price
lists, rate structures, responses to requests for proposals, presentations,
methodologies and software owned either by Keane, or developed by Keane for any
of its clients, whether electronically and/or in hard copy (all referred to as “Company
Confidential Information”).


 


3.     I
understand that I may use Company Confidential Information described in
paragraph 4 only in the ordinary course of my employment with Keane.  I also understand that I may disclose Company
Confidential Information described in paragraph 4 to others only when
authorized to do so and only when access to this Company Confidential Information
is necessary in the ordinary course of employment by, on behalf of or in
partnership with Keane.


 


4.     I
understand that securities laws strictly prohibit the disclosure of non-public
information and the trading in a stock or other security by a person in
possession of material, non-public information concerning that security.


 


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5.     I
understand that Keane retains exclusive rights in Company Confidential
Information described in paragraph 4.  I
understand that I have no right to edit, copy, remove, distribute, create
derivative works or publish any such Company Confidential Information in any
form and medium, whether electronically or in hard copy and whether alone or as
part of a collective work, except as necessary in the ordinary course of my
employment with Keane.


 


6.     At
the termination of employment I will not, without the express written
authorization of an officer (Senior Vice President or higher) of Keane, take
with me the original or any copy (in any form or medium, whether electronically
or in hard copy) of any Company Confidential Information and/or other Keane
information not readily available to the public in any form as defined under
paragraph 4.  I will promptly deliver to
Keane all of such material held by me.


 


7.     At
the termination of employment I will also return to Keane all property and/or
other equipment provided to me during the course of my employment.


 


Works Made for Hire and Inventions.


 


8.     I
understand and agree that all inventions, computer programs and the like created
or conceived by me during the course of my employment (whether solely or
jointly with others) either for use by Keane or which could be used by Keane in
furtherance of its business activity, are “Works Made for Hire”, belong solely
to Keane, and are entitled to the same protections as Company Confidential
Information.


 


9.     I
agree to sign all papers, to execute all oaths and to do everything necessary
and proper to protect Keane’s title to Works Made for Hire and to enable Keane
to apply for and obtain, maintain and enforce US and foreign patents or
copyrights thereof, but without expense to me.


 


Employee Obligations and Restrictive
Covenants.


 


10.   I
affirm that I am not subject to any agreement that restricts my ability to work
for Keane or on assignments at Keane’s clients.


 


11.   I
will, during the period of my employment by Keane, devote my full time and best
efforts to Keane’s business and will not, without the express written
permission of Keane, engage in any business activities that would conflict with
my duties. Keane agrees that such permission will not be unreasonably withheld
so long as the requested activity is not similar to or does not conflict with
the primary business of Keane. 
Furthermore, I expressly agree that during said period, I will not,
directly or indirectly, work for or assist in any way any competitor of Keane.


 


12.   I
agree that after my employment with Keane ends, for a period of twelve (12)
months immediately thereafter, I will not hire, attempt to hire, solicit, or
attempt to solicit to hire, or assist another or participate in any manner in
the hiring or soliciting for hire, of any person employed by Keane within the
one (1) year prior to the termination of my employment.


 


13.   I
agree that after my employment with Keane ends, for a period of twelve (12)
months, I will not “compete” with Keane. 
For purposes of this Agreement, “competing” is 


 


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defined as soliciting or doing business with, directly or indirectly,
any past (within the two years prior to the termination of my employment),
present or prospective customer of Keane, with whom I, or anyone reporting to
me, have had contact in connection with any business activity, but is limited
to the type of services provided by Keane to any of its customers during the
term of my employment.


 


Miscellaneous.


 


14.   Upon
termination Keane is authorized to deduct from my compensation (net pay) or
other amounts owed to me, to the extent allowed by law, any debts or financial
obligations I have incurred and owe to Keane. In the event that the amounts
owed to me do not fully repay the obligation, I agree to pay Keane such excess
amount on or before my termination date.


 


15.   I
understand that any breach of the above terms would cause irreparable harm to
Keane.  Therefore, in the event of any
such breach, Keane shall have the right to appropriate equitable relief,
including but not limited to, injunctive relief or specific performance, as
well as any and all other appropriate remedies of law.


 


16.   Any
amendment to or modification of this Agreement, and any waiver of any provision
hereof, shall be in writing.  Any waiver
by Keane of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach hereof.


 


17.   I
agree that each provision herein shall be treated as a separate and independent
clause, and the unenforceability of any one clause shall in no way impair the
enforceability of any of the other clauses herein.  Moreover, if one or more of the provisions
contained in this Agreement shall for any reason by held to be excessively
broad as to scope, activity or subject so as to be unenforceable at law, such
provision or provisions shall be construed by the appropriate judicial body by
limiting and reducing it or them, so as to be enforceable to the maximum extent
compatible with the applicable law as it shall then appear.  Upon termination of my employment for any
reason I agree that the terms and conditions of this Agreement shall continue
to be of full force and effect.


 


18.   This
Agreement shall be governed by and construed in accordance with the internal
laws (and not the laws of conflicts) of the Commonwealth of Massachusetts.


 


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19.   The
term “Keane” shall include Keane, Inc. and any of its subsidiaries,
subdivisions and affiliates.  Keane shall
have the right to assign this Agreement to its successors and assigns, and all
covenants and agreement hereunder shall inure to the benefit of and be
enforceable by said successors or assigns.


 


 


I have read and agree to the above terms and conditions.


 


 


	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
	
   

  
	
   

  
	
  Received at Branch/Corporate

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Printed

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  



 


 


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