Exhibit
10.2


 


STAG INDUSTRIAL, INC. 

2010 EQUITY INCENTIVE PLAN


 


1.                                      Establishment,
Purpose and Types of Awards


 


STAG
Industrial, Inc. (the “Company”)
hereby establishes the STAG Industrial, Inc. 2010 Equity Incentive Plan
(the “Plan”). 
The purpose of the Plan is to promote the long-term growth and
profitability of the Company and its Affiliates by (i) providing key
people with incentives to improve shareholder value and to contribute to the
growth and financial success of the Company and its Affiliates through their
future services, and (ii) enabling the Company and its Affiliates to
attract, retain and reward the best-available persons.


 


The
Plan permits the granting of stock options (including incentive stock options
qualifying under Code section 422 and nonstatutory stock options), stock
appreciation rights, restricted or unrestricted stock awards, performance
awards and other stock-based awards in the Company, or any combination of the
foregoing.


 


2.                                      Definitions


 


Under
this Plan, except where the context otherwise indicates, the following
definitions apply:


 


(a)                                  “Administrator” means the
Board or the committee(s) or officer(s) appointed by the Board that
have authority to administer the Plan as provided in Section 3 hereof.


 


(b)                                 “Affiliate” means any entity, whether now or hereafter
existing, which controls, is controlled by, or is under common control with,
the Company (including, but not limited to, joint ventures, limited liability
companies, and partnerships).  For this
purpose, “control” shall mean ownership of 50% or
more of the total combined voting power or value of all classes of stock or
interests of the entity, or the power to direct the management and policies of
the entity, by contract or otherwise.


 


(c)                                  “Award”
means with respect to the Company, any stock option, stock appreciation
right, stock award, restricted stock unit, performance award, or other
stock-based award (including an LTIP Unit).


 


(d)                                 “Board” means the
Board of Directors of the Company.


 


(e)                                  “Change
in Control” means:  (i) the
acquisition in one or more transactions by any Person, as defined in this Section 2(e),
of the beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934, as amended) of 50% or more of (A) the
then outstanding shares of Common Stock, or (B) the combined voting power
of the then outstanding securities of the Company entitled to vote generally in
the election of directors; (ii) the closing of a sale or other conveyance
of all or substantially all of the assets of the Company other than a sale or
other conveyance by the Company to an entity at least 50% of the combined
voting power of the voting securities of which are owned by the stockholders of
the Company in substantially the same proportion as their ownership of the
Common Stock immediately prior to such sale or other conveyance; (iii) the
effective time of any merger, share exchange, consolidation, or other business
combination involving the Company or a direct or indirect subsidiary of the
Company that results in the voting securities of the Company outstanding
immediately prior to such transaction representing (either by remaining
outstanding or by being converted into voting securities of the surviving
entity or its parent) less than 50% of the combined voting power of the
securities of the surviving entity or its parent outstanding


 


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immediately
after such transaction; (iv) during any period of two consecutive years,
individuals who, at the beginning of such period, constitute the Board together
with any new director or directors (other than a director designated by a
person who shall have entered into an agreement with the Company to effect a
transaction described in clause (i), (ii) or (iii)) whose election by the
Board or nomination for election by the Company’s stockholders was approved by
a vote of at least two-thirds of the directors then still in office who either
were directors at the beginning of the two-year period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof; or (v) approval by the stockholders of the
Company of the liquidation or dissolution of the Company; provided, however,
that for purposes of any Award or subplan that constitutes a “nonqualified
deferred compensation plan,” within the meaning of Code section 409A, the
Administrator, in its discretion, may specify a different definition of Change
in Control in order to comply with the provisions of Code section 409A.  For purposes of this Section 2(e), a “Person” means any individual, entity or
group within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended, other than: employee benefit plans
sponsored or maintained by the Company and by entities controlled by the
Company; an underwriter of the Common Stock in a registered public offering; or
any entity owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of the Common Stock.


 


(f)                                    “Code” means the
Internal Revenue Code of 1986, as amended, and any regulations promulgated
thereunder.


 


(g)                                 “Common
Stock” means shares of common stock of the Company.


 


(h)                                 “Fair
Market Value” means, with respect to a share of the Company’s
Common Stock for any purpose on a particular date, the value determined by the
Administrator in good faith.  However, if
the Common Stock is registered under Section 12(b) or 12(g) of
the Securities Exchange Act of 1934, as amended, and listed for trading on a
national exchange or market, “Fair Market Value”
means, as applicable, (i) either the closing price or the average of the
high and low sale price on the relevant date, as determined in the
Administrator’s discretion, quoted on the New York Stock Exchange, the American
Stock Exchange, the Nasdaq Global Select Market, or the Nasdaq Global Market;
(ii) the last sale price on the relevant date quoted on the Nasdaq Capital
Market; (iii) the average of the high bid and low asked prices on the relevant
date quoted on the Nasdaq OTC Bulletin Board Service or by the National
Quotation Bureau, Inc. or a comparable service as determined in the
Administrator’s discretion; or (iv) if the Common Stock is not quoted by
any of the above, the average of the closing bid and asked prices on the
relevant date furnished by a professional market maker for the Common Stock, or
by such other source, selected by the Administrator.  If no public trading of the Common Stock
occurs on the relevant date but the shares are so listed, then Fair Market
Value shall be determined as of the last date before the relevant date on which
trading of the Common Stock did occur. 
For all purposes under this Plan, the term “relevant
date” as used in this Section 2(h) means either the date
as of which Fair Market Value is to be determined or the next preceding date on
which public trading of the Common Stock occurs, as determined in the
Administrator’s discretion.


 


(i)                                     “Grant
Agreement” means a written document, including an electronic
writing acceptable to the Administrator, memorializing the terms and conditions
of an Award granted pursuant to the Plan and which shall incorporate the terms
of the Plan.


 


(j)                                     “IPO” means the
consummation of the first fully underwritten, firm commitment public offering
pursuant to an effective registration statement under the Securities Act of
1933, as amended, covering the offer and sale by the Company of its equity
securities, or such other event as a result of or following which the Common
Stock shall be publicly held.


 


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(k)                                  “LTIP
Unit” means an LTIP Unit as defined in the Partnership’s partnership
agreement. An LTIP Unit granted under this Plan represents the right to receive
the benefits, payments or other rights set forth in that partnership agreement,
subject to the terms and conditions of the applicable Grant Agreement and the
partnership agreement.


 


(l)                                     “Partnership” means STAG
Industrial Operating Partnership, L.P.


 


3.                                      Administration


 


(a)                                  Administration
of the Plan.  The Plan
shall be administered by the Board or by such committee or committees as may be
appointed by the Board from time to time. 
To the extent allowed by applicable state law, the Board by resolution
may authorize an officer or officers to grant Awards (other than stock Awards)
to other officers and employees of the Company and its Affiliates (including
the Partnership), and, to the extent of such authorization, such officer or
officers shall be the Administrator.


 


(b)                                 Powers
of the Administrator.  The
Administrator shall have all the powers vested in it by the terms of the Plan,
such powers to include authority, in its sole and absolute discretion, to grant
Awards under the Plan, prescribe Grant Agreements evidencing such Awards and
establish programs for granting Awards.


 


The
Administrator shall have full power and authority to take all other actions
necessary to carry out the purpose and intent of the Plan, including, but not
limited to, the authority to: 
(i) determine the eligible persons to whom, and the time or times
at which Awards shall be granted; (ii) determine the types of Awards to be
granted; (iii) determine the number of shares to be covered by or used for
reference purposes for each Award; (iv) impose such terms, limitations,
restrictions and conditions upon any such Award as the Administrator shall deem
appropriate; (v) modify, amend, extend or renew outstanding Awards, or
accept the surrender of outstanding Awards and substitute new Awards (provided
however, that, except as provided in Section 6 or 7(d) of the Plan,
any modification that would materially adversely affect any outstanding Award
(e.g., an extension of the vesting period) shall not be made without the
consent of the holder); (vi) accelerate or otherwise change the time in
which an Award may be exercised or becomes payable and to waive or accelerate
the lapse, in whole or in part, of any restriction or condition with respect to
such Award; (vii) establish objectives and conditions, if any, for earning
Awards and determining whether Awards will be paid with respect to a
performance period; and (viii) for any purpose, including but not limited
to, qualifying for preferred tax treatment under foreign tax laws or otherwise
complying with the regulatory requirements of local or foreign jurisdictions,
to establish, amend, modify, administer or terminate sub-plans, and prescribe,
amend and rescind rules and regulations relating to such sub-plans.


 


The
Administrator shall have full power and authority, in its sole and absolute
discretion, to administer, construe and interpret the Plan, Grant Agreements
and all other documents relevant to the Plan and Awards issued thereunder, to
establish, amend, rescind and interpret such rules, regulations, agreements,
guidelines and instruments for the administration of the Plan and for the
conduct of its business as the Administrator deems necessary or advisable, and
to correct any defect, supply any omission or reconcile any inconsistency in
the Plan or in any Award in the manner and to the extent the Administrator
shall deem it desirable to carry it into effect.


 


Notwithstanding
any provision of the Plan to the contrary, neither the Board nor the
Administrator shall have the authority to take any of the following actions,
unless the shareholders of the Company have approved such an action within
twelve (12) months prior to such an event: (i) the reduction of the
exercise price of any outstanding stock option or Stock Appreciation Right
under the


 


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Plan;
(ii) the cancellation of any outstanding stock option or Stock
Appreciation Right under the Plan and the grant in substitution therefor of
(1) a new stock option or Stock Appreciation Right under the Plan or
another equity plan of the Company covering the same or a different number of
shares of Common Stock, (2) a restricted stock Award (including a share
bonus), (3) an other stock-based Award, (4) a restricted stock unit,
(5) a performance award, (6) cash and/or (7) other valuable
consideration (as determined by the Board, in its sole discretion); or
(iii) any other action that is treated as a repricing under generally
accepted accounting principles.


 


(c)                                  Non-Uniform
Determinations.  The
Administrator’s determinations under the Plan (including without limitation,
determinations of the persons to receive Awards, the form, amount and timing of
such Awards, the terms and provisions of such Awards and the Grant Agreements
evidencing such Awards) need not be uniform and may be made by the Administrator
selectively among persons who receive, or are eligible to receive, Awards under
the Plan, whether or not such persons are similarly situated.


 


(d)                                 Limited
Liability.  To the maximum
extent permitted by law, no member of the Administrator shall be liable for any
action taken or decision made in good faith relating to the Plan or any Award
thereunder.


 


(e)                                  Indemnification.  To the maximum extent permitted by law and by
the Company’s charter and by-laws, the members of the Administrator shall be
indemnified by the Company in respect of all their activities under the Plan.


 


(f)                                    Effect
of Administrator’s Decision.  All actions taken and decisions and
determinations made by the Administrator on all matters relating to the Plan
pursuant to the powers vested in it hereunder shall be in the Administrator’s
sole and absolute discretion and shall be conclusive and binding on all parties
concerned, including the Company and the Partnership, the Company’s
shareholders, the Partnership’s members, any participants in the Plan and any
other employee, consultant, or director of the Company or the Partnership, and
their respective successors in interest.


 


4.                                      Shares
Available for the Plan; Maximum Awards


 


Subject
to adjustments as provided in  Section 7(c) of
the Plan, the shares of Common Stock that may be issued with respect to Awards
granted under the Plan, in the aggregate, shall not exceed 7.5% of the issued
and outstanding shares of Common Stock as of the later of the date of the IPO
or the last closing date of any shares of Common Stock sold solely to cover
overallotments in connection with the IPO (on a fully diluted basis (assuming,
if applicable, the exercise of all outstanding options, the conversion of all
warrants and convertible securities into shares of Common Stock and the
exchange of all interests in the Partnership that may be convertible into
shares of Common Stock) and including shares of Common Stock solely to cover
overallotments, but excluding any shares of Common Stock issued or issuable
under the Plan).  1,000,000 shares of
Common Stock may be issued as incentive stock options to qualify under Code
section 422.  The Company shall
reserve such number of shares for Awards under the Plan, subject to adjustments
as provided in  Section 7(c) of the
Plan. The issuance of any share of Common Stock shall result in a reduction of
the number of shares of Common Stock available for Awards. Awards that are LTIP
Units shall reduce the maximum aggregate number of shares of Common Stock that
may be issued under this Plan on a one-for-one basis, i.e.,
each such unit shall be treated as an award of shares of Common Stock.  If any Award, or portion of an Award, granted
under the Plan expires or terminates unexercised, becomes unexercisable, is
settled in cash without delivery of shares of Common Stock, or is forfeited or
otherwise terminated, surrendered or canceled, then any


 


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shares
of Common Stock and any LTIP Units covered by such lapsed, cancelled, expired,
unexercised or cash-settled portion of such Award shall be available for the
grant of other Awards under this plan.


 


Subject
to adjustments as provided in Section 7(c) of the Plan, the maximum
number of shares of Common Stock subject to Awards in the form of stock options
and/or Stock Appreciation Rights that may be granted during any one fiscal year
of the Company  to any one individual under this
Plan shall be limited to 475,000 shares. 
Subject to adjustments as provided in Section 7(c) of the
Plan, the maximum number of performance awards that may be granted to any
individual shall, with respect to Awards representing the right to receive
shares of Common Stock, not to exceed 475,000 shares in any one fiscal year of
the Company, and with respect to performance awards payable in cash, not to
exceed $2,000,000 in any one fiscal year of the Company.  Such per-individual limits shall not be
adjusted to effect a restoration of shares of Common Stock with respect to
which the related Award is terminated, surrendered or canceled.


 


Upon
the exercise of any Award granted in tandem with any other Award, the related
Award will be cancelled to the extent as to which the Award is exercised and,
notwithstanding anything in this Plan to the contrary, that number of shares of
Common Stock will no longer be available for grant.


 


5.                                      Participation


 


Participation
in the Plan shall be open to all employees, officers, and directors of, and
other individuals providing bona fide
services to or for, the Company, or of any Affiliate of the Company (including
the Partnership), as may be selected by the Administrator from time to time.
The Administrator may also grant Awards to individuals in connection with
hiring, retention or otherwise, prior to the date the individual first performs
services for the Company or an Affiliate (including the Partnership), provided
that such Awards shall not become vested or exercisable, and no shares shall be
issued to such individual, prior to the date the individual first commences
performance of such services.


 


6.                                      Awards


 


The
Administrator, in its sole discretion, establishes the terms of all Awards
granted under the Plan.  Awards may be
granted individually or in tandem with other types of Awards, concurrently with
or with respect to outstanding Awards. 
All Awards are subject to the terms and conditions provided in the Grant
Agreement.


 


(a)                                  Stock
Options.  The
Administrator may from time to time grant to eligible participants Awards of
incentive stock options as that term is defined in Code section 422 or
nonstatutory stock options; provided, however, that Awards of
incentive stock options shall be limited to employees of the Company or of any
current or hereafter existing “parent corporation”
or “subsidiary corporation,” as defined in
Code sections 424(e) and (f), respectively, of the Company and any other
individuals who are eligible to receive incentive stock options under the
provisions of Code section 422. 
Options shall have an exercise price at least equal to Fair Market Value
as of the date of grant.  No stock option
shall be an incentive stock option unless so designated by the Administrator at
the time of grant or in the Grant Agreement evidencing such stock option.  No option shall have a term longer than ten (10) years
duration.


 


(b)                                 Stock
Appreciation Rights.  The
Administrator may from time to time grant to eligible participants Awards of
Stock Appreciation Rights (“SAR”).  A SAR entitles the grantee to receive,
subject to the provisions of the Plan and the Grant Agreement, a payment having
an aggregate value equal to the product of (i) the excess of (A) the
Fair Market Value on the exercise date of one share of


 


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Common
Stock over (B) the base price per share specified in the Grant Agreement,
times (ii) the number of shares specified by the SAR, or portion thereof,
which is exercised.  The base price per
share specified in the Grant Agreement shall not be less than the Fair Market
Value on the grant date.  No SAR shall
have a term longer than ten years’ duration. 
Payment by the Company of the amount receivable upon any exercise of a
SAR may be made by the delivery of Common Stock or cash, or any combination of
Common Stock and cash, as determined in the sole discretion of the
Administrator or as specified in the Grant Agreement.  If upon settlement of the exercise of a SAR a
grantee is to receive a portion of such payment in shares of Common Stock, the
number of shares shall be determined by dividing such portion by the Fair
Market Value of a share of Common Stock on the exercise date.  No fractional shares shall be used for such
payment and the Administrator shall determine whether cash shall be given in
lieu of such fractional shares or whether such fractional shares shall be
eliminated.


 


(c)                                  Stock
Awards.  The Administrator may from
time to time grant restricted or unrestricted stock Awards to eligible
participants in such amounts, on such terms and conditions, and for such
consideration, including no consideration or such minimum consideration as may
be required by law, as it shall determine. 
A stock Award may be paid in Common Stock, in cash, or in a combination
of Common Stock and cash, as determined in the sole discretion of the
Administrator.


 


(d)                                 Restricted
Stock Units.  The
Administrator may from time to time grant Awards to eligible participants
denominated in stock-equivalent units (“Restricted Stock Units”)
in such amounts and on such terms and conditions as it shall determine.  Restricted Stock Units granted to a
participant shall represent the right at a future date to be settled in Common
Stock, in cash or in a combination of the two. 
Except as otherwise provided in the applicable Grant Agreement, the
grantee shall not have the rights of a shareholder with respect to any shares
of Common Stock represented by a Restricted Stock Unit until such Restricted
Stock Unit is settled.


 


(e)                                  Performance
Awards.  The Administrator may, in its
discretion, grant performance awards which become payable on account of
attainment of one or more performance goals established by the
Administrator.  Performance awards may be
paid by the delivery of Common Stock or cash, as determined in the sole
discretion of the Administrator. 
Notwithstanding anything to the contrary herein, certain awards granted
under this Section 6(e) may be granted in a manner which is intended
to be deductible by the Company under Section 162(m) of the Code (or
any successor section thereto) (“Performance-Based Awards”).
A participant’s Performance-Based Award shall be determined based on the attainment
of written performance goals approved by the Administrator for a performance
period established by the Administrator (i) while the outcome for that
performance period is substantially uncertain and (ii) no more than
90 days after the commencement of the performance period to which the
performance goal relates or, if less, the number of days which is equal to 25
percent of the relevant performance period. The performance goals, which must
be objective, shall be based upon one or more of the following criteria:
(i) consolidated earnings before or after taxes (including earnings before
interest, taxes, depreciation and amortization); (ii) net income;
(iii) operating income; (iv) earnings per share; (v) book value
per share; (vi) return on shareholders’ equity; (vii) expense
management; (viii) return on investment; (ix) improvements in capital
structure; (x) profitability of an identifiable business unit or product;
(xi) maintenance or improvement of profit margins; (xii) stock price;
(xiii) revenues or sales; (xiv) costs; (xv) cash flow, funds
from operations or similar measure; and (xvi) return on assets. The
foregoing criteria may relate to the Company, one or more of its Affiliates or
one or more of its or their divisions or units, or any combination of the
foregoing, and may be applied on an absolute basis and/or be relative to prior
years for the Company, one or more peer group companies or indices, or any
combination thereof, all as the Administrator shall determine. In addition, to
the degree consistent with Section 162(m) of the Code (or any
successor section thereto), the performance goals may be calculated without
regard to extraordinary items. The Administrator shall determine whether,


 


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with
respect to a performance period, the applicable performance goals have been met
with respect to a given participant and, if they have, shall so certify and
ascertain the amount of the applicable Performance-Based Award. No
Performance-Based Awards will be paid for such performance period until such
certification is made by the Administrator. The amount of the Performance-Based
Award actually paid to a given Participant may be less than the amount
determined by the applicable performance goal formula, at the discretion of the
Administrator. The amount of the Performance-Based Award determined by the
Administrator for a performance period shall be paid to the participant at such
time as determined by the Administrator in its sole discretion after the end of
such performance period; provided, however, that a participant
may, if and to the extent permitted by the Board and consistent with the
provisions of Sections 162(m) and 409A of the Code, elect to defer
payment of a Performance-Based Award.


 


(f)                                    Other
Stock-Based Awards.  The
Administrator may from time to time grant other stock-based awards to eligible
participants in such amounts, on such terms and conditions, and for such
consideration, including no consideration or such minimum consideration as may
be required by law, as it shall determine. 
Other stock-based awards may be denominated in cash, in Common Stock or
other securities, in stock-equivalent units, in stock appreciation units, in
securities or debentures convertible into Common Stock (including LTIP Units),
or in any combination of the foregoing and may be paid in Common Stock or other
securities, in cash, or in a combination of Common Stock or other securities
and cash, all as determined in the sole discretion of the Administrator;
provided, however, that the grant of the LTIP Units must satisfy the
requirements of the partnership agreement of the Partnership as in effect on
the date of the grant.


 


7.                                      Miscellaneous


 


(a)                                  Withholding
of Taxes.  Grantees
and holders of Awards shall pay to the Company or its Affiliate (including the
Partnership), or make provision satisfactory to the Administrator for payment
of, any taxes required to be withheld in respect of Awards under the Plan no
later than the date of the event creating the tax liability.  The Company or its Affiliate may, to the
extent permitted by law, deduct any such tax obligations from any payment of
any kind otherwise due to the grantee or holder of an Award.  In the event that payment to the Company or
its Affiliate of such tax obligations is made in shares of Common Stock, such
shares shall be valued at Fair Market Value on the applicable date for such
purposes and shall not exceed in amount the minimum statutory tax withholding
obligation.


 


(b)                                 Transferability.  Except as otherwise determined by the
Administrator, and in any event in the case of an incentive stock option or a
stock appreciation right granted with respect to an incentive stock option, no
Award granted under the Plan shall be transferable by a grantee otherwise than
by will or the laws of descent and distribution.  Unless otherwise determined by the
Administrator in accord with the provisions of the immediately preceding
sentence, an Award may be exercised during the lifetime of the grantee, only by
the grantee or, during the period the grantee is under a legal disability, by
the grantee’s guardian or legal representative.


 


(c)                                  Adjustments
for Corporate Transactions and Other Events.


 


(i)                                     Stock
Dividend, Stock Split and Reverse Stock Split. 
In the event of a stock dividend of, or stock split or reverse stock
split affecting, the Common Stock, (A) the maximum number of shares of
such Common Stock as to which Awards may be granted under this Plan and the
maximum number of shares with respect to which Awards may be granted during any
one fiscal year of the Company to any individual, as provided in Section 4
of the Plan, and (B) the number of shares covered by and the exercise
price and other terms of outstanding Awards, shall, without further action of
the


 


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Board,
be adjusted to reflect such event.  The
Administrator may make adjustments, in its discretion, to address the treatment
of fractional shares and fractional cents that arise with respect to
outstanding Awards as a result of the stock dividend, stock split or reverse
stock split.


 


(ii)                                  Non-Change
in Control Transactions.  Except with
respect to the transactions set forth in Section 7(c)(i), in the event of
any change affecting the Common Stock, the Company or its capitalization, by
reason of a spin-off, split-up, dividend, recapitalization, merger,
consolidation or share exchange, other than any such change that is part of a
transaction resulting in a Change in Control of the Company, the Administrator,
in its discretion and without the consent of the holders of the Awards, may
make (A) appropriate adjustments to the maximum number and kind of shares
reserved for issuance or with respect to which Awards may be granted under the
Plan, in the aggregate and with respect to any individual during any one fiscal
year of the Company, as provided in Section 4 of the Plan; and
(B) any adjustments in outstanding Awards, including but not limited to
modifying the number, kind and price of securities subject to Awards.


 


(iii)                               Change
in Control Transactions.  In the event of
any transaction resulting in a Change in Control of the Company, outstanding
stock options and other Awards that are payable in or convertible into Common
Stock under this Plan will terminate upon the effective time of such Change in
Control unless provision is made in connection with the transaction for the
continuation or assumption of such Awards by, or for the substitution of the
equivalent awards, as determined in the sole discretion of the Administrator,
of, the surviving or successor entity or a parent thereof.  In the event of such termination,
(A) the outstanding stock options and other Awards that will terminate
upon the effective time of the Change in Control shall become fully vested
immediately before the effective time of the Change in Control, and
(B) the holders of stock options and other Awards under the Plan will be
permitted, immediately before the Change in Control, to exercise or convert all
portions of such stock options or other Awards under the Plan that are then
exercisable or convertible or which become exercisable or convertible upon or
prior to the effective time of the Change in Control.


 


(iv)                              Unusual
or Nonrecurring Events.  The
Administrator is authorized to make, in its discretion and without the consent
of holders of Awards, adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or nonrecurring events
affecting the Company, or the financial statements of the Company or any
Affiliate (including the Partnership), or of changes in applicable laws,
regulations, or accounting principles, whenever the Administrator determines
that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan.


 


(d)                                 Substitution
of Awards in Mergers and Acquisitions.  Awards may be
granted under the Plan from time to time in substitution for awards held by
employees, officers, consultants or directors of entities who become or are
about to become employees, officers, consultants or directors of the Company or
an Affiliate (including the Partnership), 
as the result of a merger or consolidation of the employing entity with
the Company or an Affiliate (including the Partnership), or the acquisition by
the Company or an Affiliate (including the Partnership), of the assets or stock
of the employing entity.  The terms and
conditions of any substitute Awards so granted may vary from the terms and conditions
set forth herein to the extent that the Administrator deems appropriate at the
time of grant to conform the substitute Awards to the provisions of the awards
for which they are substituted.


 


(e)                                  Termination,
Amendment and Modification of the Plan.  The Board may terminate, amend or modify the
Plan or any portion thereof at any time subject to stockholder approval as
required by applicable law or applicable stock exchange listing rules.  Except as otherwise determined by the


 


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Board,
termination of the Plan shall not affect the Administrator’s ability to
exercise the powers granted to it hereunder with respect to Awards granted
under the Plan prior to the date of such termination.


 


(f)                                    Non-Guarantee
of Employment or Service. 
Nothing in the Plan or in any Grant Agreement thereunder shall confer
any right on an individual to continue in the service of the Company, an
Affiliate or the Partnership and shall not interfere in any way with the right
of the Company, its Affiliates or the Partnership to terminate such service at
any time with or without cause or notice and whether or not such termination
results in (i) the failure of any Award to vest; (ii) the forfeiture
of any unvested or vested portion of any Award; and/or (iii) any other
adverse effect on the individual’s interests under the Plan.


 


(g)                                 No
Trust or Fund Created. 
Neither the Plan nor any Award shall create or be construed to create a
trust or separate fund of any kind or a fiduciary relationship between the
Company, its Affiliates or the Partnership and a grantee or any other
person.  To the extent that any grantee
or other person acquires a right to receive payments pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor.


 


(h)                                 Forfeiture
Events.


 


(i)                                     A Grant Agreement may
specify that the participant’s rights, payments, and benefits with respect to
an Award shall be subject to reduction, cancellation, forfeiture, or recoupment
upon the occurrence of specified events, in addition to any otherwise
applicable vesting or performance conditions of an Award.  Such events may include, but shall not be
limited to, termination of service for cause or any act by a participant,
whether before or after termination of service, that would constitute cause for
termination of service.


 


(ii)                                  If the Company is required
to prepare an accounting restatement due to the material noncompliance of the
Company, as a result of misconduct, with any financial reporting requirement
under the securities laws, any participant who knowingly or through gross
negligence engaged in the misconduct, or who knowingly or through gross
negligence failed to prevent the misconduct, and any participant who is one of
the individuals subject to automatic forfeiture under Section 304 of the
Sarbanes-Oxley Act of 2002, shall reimburse the Company for (i) the amount
of any payment in settlement of an Award received by such participant during
the twelve- (12-) month period following the first public issuance or filing
with the United States Securities and Exchange Commission (whichever first
occurred) of the financial document embodying such financial reporting
requirement, and (ii) any profits realized by such participant from the
sale of securities of the Company during such twelve- (12-) month period.  In addition, Grant Agreements shall contain
such other claw back or recoupment policies as may be required by applicable
law or Company or Affiliate (including the Partnership) policies.


 


(i)                                     Governing
Law.  Except to the extent otherwise
specified in the Grant Agreement, the validity, construction and effect of the
Plan, of Grant Agreements entered into pursuant to the Plan, and of any rules,
regulations, determinations or decisions made by the Administrator relating to
the Plan or such Grant Agreements, and the rights of any and all persons having
or claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the
Commonwealth of Massachusetts, without regard to its conflict of laws
principles.


 


(j)                                     409A
Savings Clause.  The Plan
and all Awards granted hereunder are intended to comply with, or otherwise be
exempt from, Code section 409A.  The Plan
and all Awards granted under the Plan shall be administered, interpreted, and
construed in a manner consistent with Code section 409A


 


9

















 


to
the extent necessary to avoid the imposition of additional taxes under Code
section 409A(a)(1)(B).  Should any
provision of the Plan, any Grant Agreement, or any other agreement or
arrangement contemplated by the Plan be found not to comply with, or otherwise
be exempt from, the provisions of Code section 409A, such provision shall be
modified and given effect (retroactively if necessary), in the sole discretion
of the Administrator, and without the consent of the holder of the Award, in
such manner as the Administrator determines to be necessary or appropriate to
comply with, or to effectuate an exemption from, Code section 409A.  Notwithstanding anything in the Plan to the
contrary, in no event shall the Administrator exercise its discretion to
accelerate the payment or settlement of an Award where such payment or
settlement constitutes deferred compensation within the meaning of Code section
409A unless, and solely to the extent, that such accelerated payment or
settlement is permissible under Treasury Regulation section 1.409A-3(j)(4) or
any successor provision.


 


(k)                                  Effective
Date; Termination Date.  The
Plan is effective as of the date on which the Plan is adopted by the Board,
subject to approval of the shareholders within twelve months before or after
such date.  No Award shall be granted
under the Plan after the close of business on the day immediately preceding the
tenth anniversary of the effective date of the Plan, or if earlier, the tenth
anniversary of the date this Plan is approved by the shareholders.  Subject to other applicable provisions of the
Plan, all Awards made under the Plan prior to such termination of the Plan
shall remain in effect until such Awards have been satisfied or terminated in
accordance with the Plan and the terms of such Awards.


 


PLAN APPROVAL


 


	
  Date
  Approved by the Board:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date Approved by the
  Shareholders:

  	
   

  	
   

  
				



 


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