Document:

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                                                                   Exhibit 10.27

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

       AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") made as of
this 16th day of May, 2000 by and among John E. Henry ("Employee"), Investors
Financial Services Corp., a Delaware corporation ("IFSC"), and Investors Bank &
Trust Company, a Massachusetts chartered trust company having its principal
place of business at 200 Clarendon Street, Boston, Massachusetts (the
"Company").

       WHEREAS, IFSC, the Company and the Employee are parties to an employment
agreement, dated as of November 12, 1996 (the "Prior Agreement"), and the
parties thereto wish to enter into this Agreement in order to update the Prior
Agreement;

       NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and in consideration of the mutual
covenants and obligations herein contained, the parties hereto agree as follows:

       1. POSITION AND RESPONSIBILITIES. During the term of this Agreement, the
Employee shall serve as Senior Vice President and General Counsel of the Company
and of IFSC. The Employee will have such responsibilities, duties and authority
as he has as of the date hereof in his positions as Senior Vice President and
General Counsel of the Company and of IFSC. The Employee will have such other
responsibilities, duties and authority as may from time to time be assigned to
him that are consistent and commensurate with his status and positions at the
Company and IFSC. The Employee shall at all times report to, and only to, and
his activities shall at all times be subject to the direction and control of,
the Chief Executive Officer of the Company, and the Employee shall exercise such
powers and comply with and perform, faithfully and to the best of his ability,
such directions and duties in relation to the business and affairs of the
Company, as may from time to time be vested in or requested of him by the Chief
Executive Officer of the Company. The Employee agrees to devote substantially
all of his business time, attention and services to the diligent, faithful and
competent discharge of such duties for the successful operation of the Company's
business. During the term hereof, the Employee will not have any managerial or
operations responsibility, other than service on a board of directors, in any
enterprise, firm, corporation, trust or other business entity other than the
Company and IFSC; provided, however, that nothing herein shall prevent the
ownership by the Employee of an equity interest in any business entity, provided
that such ownership does not involve any managerial or operational
responsibility other than serving on the board of directors of a corporation.
Any directorships of corporations other than the Company and IFSC must be
approved in writing by the Board of Directors of IFSC (the "IFSC Board") in
advance. At all times during the term of this Agreement, the Employee's primary
place of employment shall be within fifteen (15) miles of Boston, Massachusetts.

       2. COMPENSATION: SALARY, ANNUAL BONUS, EQUITY PARTICIPATION AND OTHER
BENEFITS. During the term of this Agreement, the Company shall pay the Employee
the following compensation, including the following salary, bonus and other
fringe and welfare benefits:

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       (A) SALARY. In consideration of the services to be rendered by the
Employee to the Company and IFSC, the Company will pay to the Employee an annual
base salary of $200,000 (the "Base Rate"). Such Base Rate shall be payable in
conformity with the Company's customary practices for executive compensation as
such practices shall be established or modified from time to time. The
Employee's Base Rate shall be evaluated annually by the IFSC Board or the
Compensation Committee thereof, and may be increased as appropriate, within
thirty (30) days of the end of each calendar year, but in no circumstances shall
the Base Rate be decreased below the Base Rate that was established for the most
recently concluded calendar year.

       (B) WELFARE AND FRINGE BENEFITS. The Employee will be entitled to
participate in the Company's welfare and fringe benefit plans, programs and
policies generally available to other senior executives of the Company, on the
same basis as such other senior executives. In addition, the Employee will be
entitled to four (4) weeks vacation during each calendar year, which shall
accrue if and to the extent unused. The Employee will be entitled to be
reimbursed for all of his business-related expenses, including but not limited
to telephone usage and business related travel expenses.

       (C) ANNUAL BONUS. For each twelve month period ending on December 31
during the term of this Agreement ("Year End"), in addition to the amounts
payable under Section 2(A) above, the Employee shall receive a cash bonus (the
"Annual Bonus"), with the amount of such bonus to be determined pursuant to such
bonus plan as may from time to time be adopted by the IFSC Board or the
Compensation Committee thereof. The Annual Bonus shall be payable at such times
as the IFSC Board shall establish, provided that the Employee continues to be
employed by the Company on each such Year End except as otherwise provided in
Section 4 hereof.

       (D) EQUITY PARTICIPATION.

            (i) The Employee shall be entitled to participate annually in the
       1995 Stock Plan and any future equity compensation plan that is generally
       made available to other senior executives of the Company, in such amounts
       and on such terms as are determined appropriate thereunder commensurate
       with his position and performance, and in accordance with all of the
       terms and conditions of such plan.

            (ii) The Company agrees that with respect to all options and
       restricted shares to be granted by the Company, upon grant and during the
       term of such options and the vesting period of such restricted shares,
       the Company shall use its reasonable efforts to comply with the
       requirements of Rule 16b-3, promulgated pursuant to the Securities
       Exchange Act of 1934, as amended, as such rule shall be in effect from
       time to time, or with any successor provision ("Rule 16b-311") such that
       such options and restricted shares shall be afforded the benefits of Rule
       16b-3.

            (iii) The Company agrees that it shall use its best efforts to file
       and cause to become and remain effective a registration statement on Form
       S-8 (or a successor form) such that either the resale by the Employee of
       restricted shares granted to the Employee

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       by the Company or the grant of such shares and the purchase of shares by
       the Employee upon the exercise of the options to be granted to the
       Employee shall be registered under the; Securities Act of 1933, as
       amended, or any successor provision.

       (E) LIFE INSURANCE PREMIUM PAYMENTS AND TAX GROSS-UP. The Company shall
pay to the Employee the cost of premiums (such payments to be "grossed-up" to
account for the tax liability to the Employee on such payments) for a life
insurance policy for the benefit of the Trustees of an insurance trust
designated by the Employee or such other entity or individual as the Employee
shall so designate (the "Life Insurance Policy"). The amount of such policy
shall not exceed the amount of the termination for Good Reason severance payment
determined under Section 4(A) hereof. The Company shall provide reasonable
assistance to the Employee in obtaining the Life Insurance Policy.

       3. TERM. The term of this Agreement shall commence on the date first
above written and shall terminate on the earlier to occur of (i) three (3) years
from such date, or, if later, three (3) years from the date upon which the IFSC
Board last renewed the term as provided below; (ii) the Employee's death, or
upon written notice from the Company to the Employee, if the Employee is
permanently disabled, or (iii) the occurrence of any of the circumstances
described in Section 4 hereof. For the purposes of this Agreement, the Employee
shall be deemed to be permanently disabled if a physician, chosen by the
Company, and reasonably acceptable to the Employee or his legal representative,
determines in good faith that, as a result of a physical or mental condition
caused by injury, illness, disease or mental disorder, the Employee is unable to
perform his duties hereunder for any one hundred twenty (120) work days out of
any 365-day period or for ninety (90) consecutive days in any 365-day period.
Within thirty (30) days of December 31 of each calendar year, the IFSC Board
shall consider the extension of the term of this Agreement to three years from
such December 31. Each such extension shall be effective only when agreed to by
the Employee. In the event that the IFSC Board fails to extend the term of this
Agreement, the Employee may terminate this Agreement for "Good Reason," in
accordance with Section 4(A) hereof, notwithstanding any other term hereof.

       4. TERMINATION. The Employee's employment under this Agreement, and this
Agreement, subject to Section 16 hereof, may be terminated as follows:

       (A) BY THE EMPLOYEE WITH OR WITHOUT GOOD REASON. The Employee may
terminate his employment, with or without Good Reason (as defined below), at any
time upon at least sixty (60) days' advance written notice to the Company. In
the event of a family emergency, including but not limited to the death or
incapacity of an immediate family member, or upon other circumstances deemed
sufficient by a majority of the IFSC Board, the Employee may terminate his
employment upon fifteen (15) days' advance written notice to the Company. In the
event of termination at the Employee's option without Good Reason, the Employee
shall be entitled to no severance or other termination benefits after the
expiration of the sixty-day period referred to above, except as otherwise
required by law. In the event the Employee terminates his employment for Good
Reason, the Company agrees to pay the Employee, in a lump sum within fifteen
(15) days of the Employee's last day of employment with the Company, a severance
payment equal to the product of (i) the greater of (x) the remaining number of
months in the term

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of this Agreement and (y) twenty-four months (the "Severance Period"), divided
by twelve, multiplied by (ii) the sum of the Employee's Base Rate immediately
prior to such termination and the Recent Annual Bonus (as defined below). In
addition, during the Severance Period, the Company shall continue to provide the
Employee and his eligible dependents (to the extent applicable) with group
health benefits and life and disability insurance on the same terms and
conditions applicable to active senior executives of the Company, including
cost-sharing (hereinafter the "Welfare Benefits"), provided, that if the Welfare
Benefits cannot be provided to inactive employees under the terms of the
applicable plans or applicable law, the Company shall provide the Employee with,
or pay the Employee for the cost of obtaining, substitute benefits that are no
less favorable in the aggregate than the Welfare Benefits as in effect
immediately prior to the Employee's termination. Notwithstanding the foregoing,
the Company's responsibility for the cost of the Welfare Benefits shall not
exceed twice the cost it paid for such coverage immediately prior to the
Employee's termination. As used in this Agreement, "Recent Annual Bonus" shall
mean the highest Annual Bonus paid or payable to the Employee (including any
deferred amounts) with respect to any of the three full calendar years ending
immediately prior to the Employee's termination of employment.

            As used in this Agreement, a "Good Reason" shall mean any of the
       following:

            (i) a material change by the Company or IFSC in the Employee's
       authority, functions, duties or responsibilities as Senior Vice President
       and General Counsel of the Company and IFSC (including, without
       limitation, material changes in the control or structure of the Company
       or IFSC) which would cause the Employee's position with the Company or
       IFSC to become of less responsibility, importance or scope than the
       Employee's position as of the date of this Agreement, provided that such
       material change is not in connection with a termination of the Employee's
       employment hereunder for Cause in accordance with Section 4B;

            (ii) a failure by the Company to renew this Agreement as provided in
       Section 3 hereof, provided that such nonrenewal is not in connection with
       a termination of the Employee's employment hereunder for Cause in
       accordance with Section 4B; or

            (iii) a failure by the Company to comply in a material respect with
       any material provision of this Agreement or any other agreement between
       the parties, which has not been cured within fifteen (15) days after
       notice of such noncompliance has been given by the Employee to the
       Company.

       (B) AT THE ELECTION OF THE COMPANY FOR CAUSE. The Company may,
immediately and unilaterally, terminate the Employee's employment hereunder for
Cause at any time during the term of this Agreement. Termination of the
Employee's employment by the Company shall constitute a termination for Cause
under this Agreement if such termination is for one or more of the following
reasons, as found by the IFSC Board by a resolution duly adopted in good faith
by a majority of its members after notice to the Employee and an opportunity to
be heard before the IFSC Board with counsel. As used herein, "Cause" shall mean:

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            (i) the continued failure or continued refusal of the Employee to
       render services to the Company or IFSC in accordance with his obligations
       under this Agreement or a reasonable determination by a majority of the
       IFSC Board that the Employee has performed inadequately the duties of his
       employment, in each case continuing for fifteen (15) days after the
       Employee's receipt of written notice specifying the alleged failure,
       refusal or performance inadequacy;

            (ii) gross negligence, dishonesty, breach of fiduciary duty or
       material breach of the material terms of this Agreement or the other
       agreements executed in connection herewith;

            (iii) the commission by the Employee of an act of fraud,
       embezzlement or deliberate disregard of the rules or policies of the
       Company or IFSC or the commission by the Employee of any other action
       with the intent to injure materially the Company or IFSC;

            (iv) the conviction by the Employee of a felony, either in
       connection with the performance of his obligations hereunder or that will
       materially and adversely affect the Employee's ability to perform his
       obligations hereunder; or

            (v) the commission of an act which constitutes unfair competition
       with the Company or which induces any customer of the Company to breach a
       contract with the Company.

       In the event of a termination for Cause pursuant to the provisions of
clauses (ii) through (v) above, inclusive, the Employee shall not be entitled to
severance or other termination benefits, except as required by law. In the event
of a termination for Cause pursuant to the provisions of clause (i) above, the
Company, notwithstanding the remaining term of this Agreement, agrees to (x) pay
the Employee a lump-sum severance payment equal to nine (9) months' salary at
the Employee's Base Rate, within fifteen (15) days of the Employee's last day of
employment by the Company and (y) provide continuing group health benefits
during the nine (9) month severance period to the Employee and his eligible
dependents on the same basis and terms and conditions, including cost-sharing,
as provided to other active senior executives of the Company during such period.

       (C) AT THE ELECTION OF THE COMPANY FOR REASONS OTHER THAN FOR CAUSE. The
Company may, immediately and unilaterally, terminate the Employee's employment
hereunder and this Agreement at any time during the term of this Agreement
without Cause by giving sixty (60) days' advance written notice to the Employee
of the Company's election to terminate. During such sixty-day period, the
Employee will be available on a full-time basis for the benefit of the Company
to assist the Company in making the transition to a new, successor officer of
the Company. In the event the Company exercises its right to terminate the
Employee under this Section 4(C), the Company agrees to pay the Employee, in a
lump sum within fifteen (15) days of the Employee's last day of employment with
the Company, a severance payment equal to the amount determined under Section
4(A) hereof and to provide the Welfare Benefits during the

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Severance Period, in each case as if the Employee had terminated employment for
Good Reason under Section 4(A) hereof.

       (D) TERMINATION DUE TO DEATH OR DISABILITY. In the event this Agreement
shall terminate due to the Employee's death or upon written notice from the
Company to the Employee if the Employee is permanently disabled, the Company
shall pay the Employee or his legal representatives an amount equal to the
amount payable under Section 4(C) as if the Employee had been terminated other
than for Cause, reduced by any amount payable to an insurance trust or such
other designated individual or entity under the Life Insurance Policy, if any,
in the case of the Employee's death, or under disability insurance provided by
the Company, in the case of the Employee's termination due to his permanent
disability. In addition, upon a termination of the Employee due to his permanent
disability, the Company shall continue to provide the Welfare Benefits during
the Severance Period, as if the Employee's employment had been terminated other
than for Cause under Section 4(C). The provisions of this Section 4(D) shall
survive the termination of this Agreement by reason of the death or permanent
disability of the Employee.

       5. NONCOMPETITION AND CONFIDENTIALITY. In connection with his employment
by the Company, the Employee has previously executed the Noncompetition and
Confidentiality Agreement attached hereto as EXHIBIT A, the terms and conditions
of which are incorporated herein by reference. The Noncompetition and
Confidentiality Agreement shall survive the termination of this Agreement and
shall remain in full force and effect for so long as is provided by its own
terms and as is permitted by law.

       6. CONSENT AND WAIVER BY THIRD PARTIES. The Employee hereby represents
and warrants that he has obtained all waivers and/or consents from third parties
which are necessary to enable him to enjoy employment with the Company on the
terms and conditions set forth herein and to execute and perform this Agreement
without being in conflict with any other agreement, obligation or understanding
with any such third party. The Employee represents that he is not bound by any
agreement or any other existing or previous business relationship, which
conflicts with, or may conflict with, the performance of his obligations
hereunder or prevent the full performance of his duties and obligations
hereunder.

       7. GOVERNING LAW. This Agreement, the employment relationship
contemplated herein and any claim arising from such relationship, whether or not
arising under this Agreement, shall be governed by and construed in accordance
with the internal law of the Commonwealth of Massachusetts and this Agreement
shall be deemed to be performable in Massachusetts.

       8. SEVERABILITY. In case any one or more of the provisions contained in
the Agreement or the other agreements executed in connection with the
transactions contemplated hereby for any reason shall be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement or such
other agreements, but this Agreement or such other agreements, as the case may
be, shall be construed and reformed to the maximum extent permitted by law.

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       9. WAIVERS AND MODIFICATIONS. This Agreement may be modified, and the
rights, remedies and obligations contained in any provision hereof may be
waived, only in accordance with this Section 9. No waiver by either party of any
breach by the other or any provision hereof shall be deemed to be a waiver of
any later or other breach thereof or as a waiver of any other provision of this
Agreement. This Agreement sets forth all of the terms of the understandings
between the parties with reference to the subject matter set forth herein on or
after the date hereof and may not be waived, changed, discharged or terminated
orally or by any course of dealing between the parties, but only by an
instrument in writing signed by the party against whom any waiver, change,
discharge or termination is sought. No modification or waiver by the Company
shall be effective without the consent of at least a majority of the members of
the IFSC Board (excluding the Employee) then in office at the time of such
modification or waiver.

       10. ASSIGNMENT. The Employee acknowledges that the services to be
rendered by him hereunder are unique and personal in nature. Accordingly, the
Employee may not assign any of his rights or delegate any of his duties or
obligations under this Agreement, provided, however, that this Agreement shall
inure to the benefit of Employee's heirs, executors, administrators, personal
and legal representatives, distributees, devisees, legatees and successors. The
rights and obligations of the Company and IFSC under this Agreement shall inure
to the benefit of, and shall be binding upon, the successors and assigns of the
Company and IFSC, respectively. The Company and IFSC agree that a successor in
interest by merger, operation of law, consolidation, assignment, purchase or
otherwise of a controlling interest in the business of the Company or IFSC will
be informed prior to such event of the existence of this Agreement. The Company
and IFSC will require any successor (whether direct or indirect, by purchase,
merger, operation of law, consolidation, assignment or otherwise of a
controlling interest in the business, stock or other assets of the Company or
IFSC) to assume expressly and agree to perform this Agreement. As used in this
Agreement, "the Company" and "IFSC" shall mean the Company and IFSC as
hereinbefore defined and any successors as aforesaid.

       11. ACKNOWLEDGMENTS. The Employee hereby acknowledges and recognizes that
the enforcement of any of the provisions in this Agreement and the
Noncompetition and Confidentiality Agreement incorporated herein may potentially
interfere with the Employee's ability to pursue a proper livelihood. The
Employee represents that he is knowledgeable about the business of the Company.
The Employee recognizes and agrees that the enforcement of the Noncompetition
and Confidentiality Agreement is intended to ensure the preservation, protection
and continuity of the business trade secrets and goodwill of the Company. The
Employee agrees that, due to the proprietary nature of the Company's business,
the restrictions set forth in the Noncompetition and Confidentiality Agreement
are reasonable as to time and scope. The foregoing shall not prohibit the
Employee from employment with any company by which the Employee has been
employed in the past so long as his activities with any such company do not
otherwise constitute a breach of the Noncompetition and Confidentiality
Agreement.

       12. ENTIRE AGREEMENT. This Agreement, and the Noncompetition and
Confidentiality Agreement and any other plans or agreements referenced herein,
constitute the entire understanding of the parties relating to the subject
matter hereof and, except as provided herein, supersede and cancel all
agreements, written or oral, made prior to the date hereof between the

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Employee and the Company relating to employment, salary, bonus, or other
compensation of any description, future equity participation, pension,
post-retirement benefits, severance or other remuneration, other than the Change
of Control Agreement between IFSC and the Employee dated as of May 16, 2000. In
addition, notwithstanding anything contained herein to the contrary, with
respect to stock options granted to the Employee prior to the date of this
Agreement, the definition of "Change of Control" contained in Section 4(D) of
the Prior Agreement shall continue to apply and shall remain in full force and
effect.

       13. NOTICES. All notices hereunder shall be in writing and shall be
delivered in person, mailed by certified or registered mail, return receipt
requested, or sent by overnight courier, addressed as follows:

       If to the Company, to:        Investors Financial Services Corp.
                                     200 Clarendon Street
                                     Boston, MA   02116-9130
                                     Attention:  Karen C. Keenan

       If to the Employee:           At the most recent address
                                     on file at the Company.

All notices hereunder shall be deemed to have been given either (i) if
personally, upon receipt, (ii) if sent by overnight courier on the next business
day following the day such notice is delivered to the courier service, or (iii)
if sent by registered or certified mail, on the 5th business day following the
day such mailing is made.

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

       15. SECTION HEADINGS. The descriptive section headings herein have been
inserted for convenience only and shall not be deemed to define, limit, or
otherwise affect the construction of any provision hereof.

       16. SURVIVAL. Notwithstanding any other provision hereof, the provisions
of Sections 2(D), 4, 5, 17, 18, 19 and 20 shall survive any termination of the
Employees employment and the other provisions of this Agreement.

       17. MITIGATION. The Employee shall not be required to mitigate the amount
of any payment provided for in this Agreement by seeking other employment or
otherwise, nor, other than as provided in Section 4(D) hereof, shall the amount
of any payment provided for herein be reduced by any compensation earned by the
Employee as the result of employment by another employer or by retirement
benefits or insurance payments after the date of termination or otherwise.

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       18. LEGAL EXPENSES. The Company will pay the Employee's reasonable fees
for legal and tax advice and other related expenses associated with the
negotiation and completion of this Agreement, as well as any future amendments
hereto and any disputes arising hereunder, provided, however, in the event of
any dispute arising hereunder, if a court of competent jurisdiction shall render
a final judgment in favor of the Company on the issues in such dispute
hereunder, from which there is no further right of appeal, the Employee shall
reimburse the Company all amounts paid to the Employee under this Section 18
with respect to such dispute.

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       19. INDEMNIFICATION. The Company agrees that the Employee shall be
entitled to indemnification, and advancement of expenses in connection
therewith, as a director, officer and employee of the Company, of IFSC and of
any affiliate of the Company or IFSC to the full extent permitted by applicable
law.

       20. WITHHOLDING. The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.

                  [Remainder of Page Intentionally Left Blank]

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       IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first above written as an instrument under seal.

Investors Bank & Trust Company            John E. Henry
By:
   --------------------------------       --------------------------------------
                                          Signature
Title:
      -----------------------------

Investors Financial Services Corp.
By:
   --------------------------------

Title:
      -----------------------------

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                                                                 Exhibit 10.28

                                CHANGE OF CONTROL
                              EMPLOYMENT AGREEMENT

          AGREEMENT, dated as of the 16th day of May, 2000 (this
"Agreement"), by and between Investors Financial Services Corp., a Delaware
corporation (the "Company"), and John E. Henry (the "Executive").

          WHEREAS, the Board of Directors of the Company (the "Board"), has
determined that it is in the best interests of the Company and its
stockholders to assure that the Company will have the continued dedication of
the Executive, notwithstanding the possibility, threat or occurrence of a Change
of Control (as defined herein). The Board believes it is imperative to diminish
the inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change of Control and
to encourage the Executive's full attention and dedication to the current
Company and in the event of any threatened or pending Change of Control, and to
provide the Executive with compensation and benefits arrangements upon a Change
of Control that ensure that the compensation and benefits expectations of the
Executive will be satisfied and that are competitive with those of other
corporations. Therefore, in order to accomplish these objectives, the Board has
caused the Company to enter into this Agreement.

          NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

          SECTION 1. CERTAIN DEFINITIONS. (a) "Effective Date" means the
first date during the Change of Control Period (as defined herein) on which a
Change of Control occurs. Notwithstanding anything in this Agreement to the
contrary, if a Change of Control occurs and if the Executive's employment
with the Company is terminated prior to the date on which the Change of
Control occurs, and if it is reasonably demonstrated by the Executive that
such termination of employment (1) was at the request of a third party that
has taken steps reasonably calculated to effect a Change of Control or (2)
otherwise arose in connection with or anticipation of a Change of Control,
then "Effective Date" means the date immediately prior to the date of such
termination of employment.

          (b) "Change of Control Period" means the period commencing on the
date hereof and ending on the third anniversary of the date hereof; PROVIDED,
HOWEVER, that, commencing on the date one year after the date hereof, and on
each annual anniversary of such date (such date and each annual anniversary
thereof, the "Renewal Date"), unless previously terminated, the Change of
Control Period shall be automatically extended so as to terminate three years
from such Renewal Date, unless, at least 60 days prior to the Renewal Date,
the Company shall give notice to the Executive that the Change of Control
Period shall not be so extended.

          (c) "affiliated company" means any company controlled by,
controlling or under common control with the Company.

          (d) "Change of Control" means:

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          (1) The acquisition by 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 (the "Exchange Act")) (a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20%
or more of either (A) the then-outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (B) the combined voting
power of the then-outstanding voting securities of the Company entitled to
vote generally in the election of directors (the "Outstanding Company Voting
Securities"); PROVIDED, HOWEVER, that, for purposes of this Section 1(d), the
following acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any affiliated company or (iv) any
acquisition by any corporation pursuant to a transaction that complies with
Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C).

          (2) Individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; PROVIDED, HOWEVER, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption
of office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the Board.

          (3) Consummation of a reorganization, merger, consolidation or sale
or other disposition of all or substantially all of the assets of the Company
(a "Business Combination"), in each case, unless, following such Business
Combination, (A) all or substantially all of the individuals and entities
that were the beneficial owners of the Outstanding Company Common Stock and
the Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding voting securities entitled to vote generally in the election
of directors, as the case may be, of the corporation resulting from such
Business Combination (including, without limitation, a corporation that, as a
result of such transaction, owns the Company or all or substantially all of
the Company's assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership immediately prior to
such Business Combination of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities, as the case may be, (B) no Person
(excluding any corporation resulting from such Business Combination or any
employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then-outstanding shares of
common stock of the corporation resulting from such Business Combination or
the combined voting power of the then-outstanding voting securities of such
corporation, except to the extent that such ownership existed prior to the
Business Combination, and (C) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement or of the action of the Board providing for such Business
Combination; or

                                       2
<PAGE>

          (4)  Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

          SECTION 2. EMPLOYMENT PERIOD. The Company hereby agrees to continue
the Executive in its employ, and the Executive hereby agrees to remain in the
employ of the Company, subject to the terms and conditions of this Agreement,
for the period commencing on the Effective Date and ending on the third
anniversary of the Effective Date (the "Employment Period").

          SECTION 3. TERMS OF EMPLOYMENT. (a) POSITION AND DUTIES. (1) During
the Employment Period, (A) the Executive's position (including status,
offices, titles and reporting requirements), authority, duties and
responsibilities shall be at least commensurate in all material respects with
the most significant of those held, exercised and assigned at any time during
the 120-day period immediately preceding the Effective Date and (B) the
Executive's services shall be performed at the office where the Executive was
employed immediately preceding the Effective Date or at any other location
less than 15 miles from such office.

          (2) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive
agrees to devote reasonable attention and time during normal business hours
to the business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to use
the Executive's reasonable best efforts to perform faithfully and efficiently
such responsibilities. During the Employment Period, it shall not be a
violation of this Agreement 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 significantly
interfere with the performance of the Executive's responsibilities as an
employee of the Company in accordance with this Agreement. It is expressly
understood and agreed that, to the extent that any such activities have been
conducted by the Executive prior to the Effective Date, the continued conduct
of such activities (or the conduct of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter be deemed to
interfere with the performance of the Executive's responsibilities to the
Company.

          (b) COMPENSATION. (1) BASE SALARY. During the Employment Period,
the Executive shall receive an annual base salary (the "Annual Base Salary"),
which Annual Base Salary shall be paid in equal monthly installments at an
annual rate at least equal to 12 times the highest monthly base salary paid
or payable, including any base salary that has been earned but deferred, to
the Executive by the Company and the affiliated companies in respect of the
12-month period immediately preceding the month in which the Effective Date
occurs. During the Employment Period, the Annual Base Salary shall be
reviewed at least annually, beginning no more than 12 months after the last
salary increase awarded to the Executive prior to the Effective Date. Any
increase in the Annual Base Salary shall not serve to limit or reduce any
other obligation to the Executive under this Agreement. The Annual Base
Salary shall not be reduced after any such increase and the term "Annual Base
Salary" shall refer to the Annual Base Salary as so increased.

                                       3
<PAGE>

          (2) ANNUAL BONUS. In addition to the Annual Base Salary, the
Executive shall be awarded, for each fiscal year ending during the Employment
Period, an annual bonus (the "Annual Bonus") in cash at least equal to the
Executive's highest bonus under the Company's annual Executive Compensation
Plan, or any comparable bonus under any predecessor or successor plan, for
the last three full fiscal years prior to the Effective Date (annualized, in
the event that the Executive was not employed by the Company for the whole of
such fiscal year) (the "Recent Annual Bonus"). Each such Annual Bonus shall
be paid no later than the end of the third month of the fiscal year next
following the fiscal year for which the Annual Bonus is awarded, unless the
Executive shall elect to defer the receipt of such Annual Bonus.

          (3) INCENTIVE, SAVINGS AND RETIREMENT PLANS. During the Employment
Period, the Executive shall be entitled to participate in all incentive,
savings and retirement plans, practices, policies, and programs applicable
generally to other peer executives of the Company and the affiliated
companies, but in no event shall such plans, practices, policies and programs
provide the Executive with incentive opportunities (measured with respect to
both regular and special incentive opportunities, to the extent, if any, that
such distinction is applicable), savings opportunities and retirement benefit
opportunities, in each case, less favorable, in the aggregate, than the most
favorable of those provided by the Company and the affiliated companies for
the Executive under such plans, practices, policies and programs as in effect
at any time during the 120-day period immediately preceding the Effective
Date or, if more favorable to the Executive, those provided generally at any
time after the Effective Date to other peer executives of the Company and the
affiliated companies.

          (4) WELFARE BENEFIT PLANS. During the Employment Period, the
Executive and/or the Executive's family, as the case may be, shall be
eligible for participation in and shall receive all benefits under welfare
benefit plans, practices, policies and programs provided by the Company and
the affiliated companies (including, without limitation, medical,
prescription, dental, disability, employee life, group life, accidental death
and travel accident insurance plans and programs) to the extent applicable
generally to other peer executives of the Company and the affiliated
companies, but in no event shall such plans, practices, policies and programs
provide the Executive with benefits that are less favorable, in the
aggregate, than the most favorable of such plans, practices, policies and
programs in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the
Executive, those provided generally at any time after the Effective Date to
other peer executives of the Company and the affiliated companies.

          (5) EXPENSES. During the Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expenses incurred
by the Executive in accordance with the most favorable policies, practices
and procedures of the Company and the affiliated companies in effect for the
Executive at any time during the 120-day period immediately preceding the

                                       4
<PAGE>

Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to other peer executives of the Company and the
affiliated companies.

          (6) FRINGE BENEFITS. During the Employment Period, the Executive
shall be entitled to fringe benefits, including, without limitation, tax and
financial planning services, payment of club dues, and, if applicable, use of
an automobile and payment of related expenses, in accordance with the most
favorable plans, practices, programs and policies of the Company and the
affiliated companies in effect for the Executive at any time during the
120-day period immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect generally at any time thereafter with respect
to other peer executives of the Company and the affiliated companies.

          (7) OFFICE AND SUPPORT STAFF. During the Employment Period, the
Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments, and to exclusive personal secretarial and
other assistance, at least equal to the most favorable of the foregoing
provided to the Executive by the Company and the affiliated companies at any
time during the 120-day period immediately preceding the Effective Date or,
if more favorable to the Executive, as provided generally at any time
thereafter with respect to other peer executives of the Company and the
affiliated companies.

          (8) VACATION. During the Employment Period, the Executive shall be
entitled to paid vacation in accordance with the most favorable plans,
policies, programs and practices of the Company and the affiliated companies
as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to
other peer executives of the Company and the affiliated companies.

          SECTION 4. TERMINATION OF EMPLOYMENT. (a) DEATH OR DISABILITY. The
Executive's employment shall terminate automatically if the Executive dies
during the Employment Period. If the Company determines in good faith that
the Disability (as defined herein) of the Executive has occurred during the
Employment Period (pursuant to the definition of "Disability"), it may give
to the Executive written notice in accordance with Section 11(b) of its
intention to terminate the Executive's employment. In such event, the
Executive's employment with the Company shall terminate effective on the 30th
day after receipt of such notice by the Executive (the "Disability Effective
Date"), PROVIDED that, within the 30 days after such receipt, the Executive
shall not have returned to full-time performance of the Executive's duties.
"Disability" means the absence of the Executive from the Executive's duties
with the Company on a full-time basis for 180 consecutive business days as a
result of incapacity due to mental or physical illness that is determined to
be total and permanent by a physician selected by the Company or its insurers
and acceptable to the Executive or the Executive's legal representative.

                                       5
<PAGE>

          (b) CAUSE. The Company may terminate the Executive's employment
during the Employment Period for Cause. "Cause" means:

          (1) the willful and continued failure of the Executive to perform
substantially the Executive's duties with the Company or any affiliated
company (other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial
performance is delivered to the Executive by the Board or the Chief Executive
Officer of the Company that specifically identifies the manner in which the
Board or the Chief Executive Officer of the Company believes that the
Executive has not substantially performed the Executive's duties, or

          (2) the willful engaging by the Executive in illegal conduct or
gross misconduct that is materially and demonstrably injurious to the Company.

For purposes of this Section 4(b), no act, or failure to act, on the part of the
Executive shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the Chief Executive Officer of
the Company or a senior officer of the Company or based upon the advice of
counsel for the Company shall be conclusively presumed to be done, or omitted to
be done, by the Executive in good faith and in the best interests of the
Company. The cessation of employment of the Executive shall not be deemed to be
for Cause unless and until there shall have been delivered to the Executive a
copy of a resolution duly adopted by the affirmative vote of not less than
three-quarters of the entire membership of the Board at a meeting of the Board
called and held for such purpose (after reasonable notice is provided to the
Executive and the Executive is given an opportunity, together with counsel for
the Executive, to be heard before the Board), finding that, in the good faith
opinion of the Board, the Executive is guilty of the conduct described in
Section 4(b)(1) or 4(b)(2), and specifying the particulars thereof in detail.

          (c) GOOD REASON. The Executive's employment may be terminated by
the Executive for Good Reason. "Good Reason" means:

          (1) the assignment to the Executive of any duties inconsistent in
any respect with the Executive's position (including status, offices, titles
and reporting requirements), authority, duties or responsibilities as
contemplated by Section 3(a), or any other action by the Company that results
in a diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent action
not taken in bad faith and that is remedied by the Company promptly after
receipt of notice thereof given by the Executive;

          (2) any failure by the Company to comply with any of the provisions
of Section 3(b), other than an isolated, insubstantial and inadvertent
failure not occurring in bad faith and that is remedied by the Company
promptly after receipt of notice thereof given by the Executive;

                                       6
<PAGE>

          (3) the Company's requiring the Executive to be based at any office
or location other than as provided in Section 3(a)(1)(B) or the Company's
requiring the Executive to travel on Company business to a substantially
greater extent than required immediately prior to the Effective Date;

          (4) any purported termination by the Company of the Executive's
employment otherwise than as expressly permitted by this Agreement; or

          (5) any failure by the Company to comply with and satisfy
Section 10(c).

          For purposes of this Section 4(c), any good faith determination of
Good Reason made by the Executive shall be conclusive. Anything in this
Agreement to the contrary notwithstanding, a termination by the Executive for
any reason during the 30-day period immediately following the first
anniversary of the Effective Date shall be deemed to be a termination for
Good Reason for all purposes of this Agreement.

          (d) NOTICE OF TERMINATION. Any termination by the Company for
Cause, or by the Executive for Good Reason, shall be communicated by Notice
of Termination to the other party hereto given in accordance with Section
11(b). "Notice of Termination" means a written notice that (1) indicates the
specific termination provision in this Agreement relied upon, (2) to the
extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated, and (3) if the Date of
Termination (as defined herein) is other than the date of receipt of such
notice, specifies the Date of Termination (which Date of Termination shall be
not more than 30 days after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of Termination any fact
or circumstance that contributes to a showing of Good Reason or Cause shall
not waive any right of the Executive or the Company, respectively, hereunder
or preclude the Executive or the Company, respectively, from asserting such
fact or circumstance in enforcing the Executive's or the Company's respective
rights hereunder.

          (e) DATE OF TERMINATION. "Date of Termination" means (1) if the
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination
or any later date specified in the Notice of Termination, as the case may be,
(2) if the Executive's employment is terminated by the Company other than for
Cause or Disability, the Date of Termination shall be the date on which the
Company notifies the Executive of such termination, and (3) if the
Executive's employment is terminated by reason of death or Disability, the
Date of Termination shall be the date of death of the Executive or the
Disability Effective Date, as the case may be.

          SECTION 5. OBLIGATIONS OF THE COMPANY UPON TERMINATION. (a) GOOD
REASON; OTHER THAN FOR CAUSE, DEATH OR DISABILITY.  If, during the Employment
Period, the Company terminates the Executive's employment other than for
Cause or Disability or the Executive terminates employment for Good Reason:

                                       7
<PAGE>

          (1) the Company shall pay to the Executive, in a lump sum in cash
within 30 days after the Date of Termination, the aggregate of the following
amounts:

          (A) the sum of (i) the Executive's Annual Base Salary through the
Date of Termination to the extent not theretofore paid, (ii) the product of
(x) the higher of (I) the Recent Annual Bonus and (II) the Annual Bonus paid
or payable, including any bonus or portion thereof that has been earned but
deferred (and annualized for any fiscal year consisting of less than 12 full
months or during which the Executive was employed for less than 12 full
months), for the most recently completed fiscal year during the Employment
Period, if any (such higher amount, the "Highest Annual Bonus") and (y) a
fraction, the numerator of which is the number of days in the current fiscal
year through the Date of Termination and the denominator of which is 365, and
(iii) any compensation previously deferred by the Executive (together with
any accrued interest or earnings thereon) and any accrued vacation pay, in
each case, to the extent not theretofore paid (the sum of the amounts
described in subclauses (i), (ii) and (iii), the "Accrued Obligations"); and

          (B) the amount equal to the product of (i) three and (ii) the sum
of (x) the Executive's Annual Base Salary and (y) the Highest Annual Bonus;
and

          (C) an amount equal to the excess of (i) the actuarial equivalent
of the benefit under the Company's qualified defined benefit retirement plan
(the "Retirement Plan") (utilizing actuarial assumptions no less favorable to
the Executive than those in effect under the Retirement Plan immediately
prior to the Effective Date) and any excess or supplemental retirement plan
in which the Executive participates (collectively, the "SERP") that the
Executive would receive if the Executive's employment continued for three
years after the Date of Termination, assuming for this purpose that all
accrued benefits are fully vested and assuming that the Executive's
compensation in each of the three years is that required by Sections 3(b)(1)
and 3(b)(2), over (ii) the actuarial equivalent of the Executive's actual
benefit (paid or payable), if any, under the Retirement Plan and the SERP as
of the Date of Termination;

          (2) for three years after the Executive's Date of Termination, or
such longer period as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal to those that would
have been provided to them in accordance with the plans, programs, practices
and policies described in Section 3(b)(4) if the Executive's employment had
not been terminated or, if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer executives of the
Company and the affiliated companies and their families, PROVIDED, HOWEVER,
that, if the Executive becomes reemployed with another employer and is
eligible to receive medical or other welfare benefits under another employer
provided plan, the medical and other welfare benefits described herein shall
be secondary to those provided under such other plan during such applicable
period of eligibility. For purposes of determining

                                       8
<PAGE>

eligibility (but not the time of commencement of benefits) of the Executive
for retiree benefits pursuant to such plans, practices, programs and
policies, the Executive shall be considered to have remained employed until
three years after the Date of Termination and to have retired on the last day
of such period;

          (3) the Company shall, at its sole expense as incurred, provide the
Executive with outplacement services the scope and provider of which shall be
selected by the Executive in the Executive's sole discretion; and

          (4) to the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or that the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company and the affiliated companies (such other amounts and benefits, the
"Other Benefits").

          (b) DEATH. If the Executive's employment is terminated by reason of
the Executive's death during the Employment Period, this Agreement shall
terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations and the timely payment or provision of the Other Benefits. The
Accrued Obligations shall be paid to the Executive's estate or beneficiary,
as applicable, in a lump sum in cash within 30 days of the Date of
Termination. With respect to the provision of the Other Benefits, the term
"Other Benefits" as utilized in this Section 5(b) shall include, without
limitation, and the Executive's estate and/or beneficiaries shall be entitled
to receive, benefits at least equal to the most favorable benefits provided
by the Company and the affiliated companies to the estates and beneficiaries
of peer executives of the Company and the affiliated companies under such
plans, programs, practices and policies relating to death benefits, if any,
as in effect with respect to other peer executives and their beneficiaries at
any time during the 120-day period immediately preceding the Effective Date
or, if more favorable to the Executive's estate and/or the Executive's
beneficiaries, as in effect on the date of the Executive's death with respect
to other peer executives of the Company and the affiliated companies and
their beneficiaries.

          (c) DISABILITY. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations and the timely payment or provision
of the Other Benefits. The Accrued Obligations shall be paid to the Executive
in a lump sum in cash within 30 days of the Date of Termination. With respect
to the provision of the Other Benefits, the term "Other Benefits" as utilized
in this Section 5(c) shall include, and the Executive shall be entitled after
the Disability Effective Date to receive, disability and other benefits at
least equal to the most favorable of those generally provided by the Company
and the affiliated companies to disabled executives and/or their families in
accordance with such plans, programs, practices and policies relating to
disability, if any, as in effect generally with respect to other peer
executives and their families at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the
Executive and/or the Executive's family, as in effect at

                                       9
<PAGE>

any time thereafter generally with respect to other peer executives of the
Company and the affiliated companies and their families.

          (d) CAUSE; OTHER THAN FOR GOOD REASON. If the Executive's
employment is terminated for Cause during the Employment Period, this
Agreement shall terminate without further obligations to the Executive other
than the obligation to pay to the Executive (1) the Executive's Annual Base
Salary through the Date of Termination, (2) the amount of any compensation
previously deferred by the Executive, and (3) the Other Benefits, in each
case, to the extent theretofore unpaid. If the Executive voluntarily
terminates employment during the Employment Period, excluding a termination
for Good Reason, this Agreement shall terminate without further obligations
to the Executive, other than for the Accrued Obligations and the timely
payment or provision of the Other Benefits. In such case, all the Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30
days of the Date of Termination.

          SECTION 6. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement
shall prevent or limit the Executive's continuing or future participation in
any plan, program, policy or practice provided by the Company or the
affiliated companies and for which the Executive may qualify, nor, subject to
Section 11(f), shall anything herein limit or otherwise affect such rights as
the Executive may have under any contract or agreement with the Company or
the affiliated companies. Amounts that are vested benefits or that the
Executive is otherwise entitled to receive under any plan, policy, practice
or program of or any contract or agreement with the Company or the affiliated
companies at or subsequent to the Date of Termination shall be payable in
accordance with such plan, policy, practice or program or contract or
agreement, except as explicitly modified by this Agreement.

          SECTION 7. FULL SETTLEMENT. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense, or other claim, right or action that the Company may
have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement, and such amounts shall not be reduced whether
or not the Executive obtains other employment. The Company agrees to pay as
incurred, to the full extent permitted by law, all legal fees and expenses
that the Executive may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company, the Executive or others
of the validity or enforceability of, or liability under, any provision of
this Agreement or any guarantee of performance thereof (including as a result
of any contest by the Executive about the amount of any payment pursuant to
this Agreement), plus, in each case, interest on any delayed payment at the
applicable federal rate provided for in Section 7872(f)(2)(A) of the Internal
Revenue Code of 1986, as amended (the "Code").

                                       10
<PAGE>

          SECTION 8. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

          (a) Anything in this Agreement to the contrary notwithstanding and
except as set forth below, in the event it shall be determined that any
payment or distribution by the Company or the affiliated companies to or for
the benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise but
determined without regard to any additional payments required under this
Section 8) (the "Payment") would be subject to the excise tax imposed by
Section 4999 of the Code, or any interest or penalties are incurred by the
Executive with respect to such excise tax (such excise tax, together with any
such interest and penalties, collectively, the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment (the "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and
penalties imposed with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the
foregoing provisions of this Section 8(a), if it shall be determined that the
Executive is entitled to the Gross-Up Payment, but that the Payments do not
exceed 110% of the greatest amount that could be paid to the Executive such
that the receipt of the Payments would not give rise to any Excise Tax (the
"Reduced Amount"), then no Gross-Up Payment shall be made to the Executive
and the Payments, in the aggregate, shall be reduced to the Reduced Amount.

          (b) Subject to the provisions of Section 8(c), all determinations
required to be made under this Section 8, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made
by Deloitte & Touche LLP or such other certified public accounting firm as
may be designated by the Executive (the "Accounting Firm") that shall provide
detailed supporting calculations both to the Company and the Executive within
15 business days of the receipt of notice from the Executive that there has
been a Payment or such earlier time as is requested by the Company. In the
event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of Control, the Executive
shall appoint another nationally recognized accounting firm to make the
determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder). All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment,
as determined pursuant to this Section 8, shall be paid by the Company to the
Executive within five days of the receipt of the Accounting Firm's
determination. Any determination by the Accounting Firm shall be binding upon
the Company and the Executive. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up
Payments that will not have been made by the Company should have been made
(the "Underpayment"), consistent with the calculations required to be made
hereunder. In the event the Company exhausts its remedies pursuant to Section
8(c) and the Executive thereafter is required to make a payment of any Excise
Tax, the Accounting Firm shall determine the amount of the Underpayment that
has occurred and any such Underpayment shall be promptly paid by the Company
to or for the benefit of the Executive.

                                       11
<PAGE>

          (c) The Executive shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than 10 business days after the
Executive is informed in writing of such claim and shall apprise the Company
of the nature of such claim and the date on which such claim is requested to
be paid. The Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which the Executive gives such notice
to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the
Executive in writing prior to the expiration of such period that the Company
desires to contest such claim, the Executive shall:

          (1) give the Company any information reasonably requested by the
Company relating to such claim,

          (2) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim
by an attorney reasonably selected by the Company,

          (3) cooperate with the Company in good faith in order effectively
to contest such claim, and

          (4) permit the Company to participate in any proceedings relating
to such claim;

          PROVIDED, HOWEVER, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest, and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 8(c), the Company shall control all
proceedings taken in connection with such contest, and, at its sole option,
may pursue or forgo any and all administrative appeals, proceedings, hearings
and conferences with the applicable taxing authority in respect of such claim
and may, at its sole option, either direct the Executive to pay the tax
claimed and sue for a refund or contest the claim in any permissible manner,
and the Executive agrees to prosecute such contest to a determination before
any administrative tribunal, in a court of initial jurisdiction and in one or
more appellate courts, as the Company shall determine; PROVIDED, HOWEVER,
that, if the Company directs the Executive to pay such claim and sue for a
refund, the Company shall advance the amount of such payment to the
Executive, on an interest-free basis, and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect
to such advance or with respect to any imputed income with respect to such
advance; and PROVIDED, FURTHER, that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control
of the contest shall be limited to issues with respect to which the Gross-Up

                                       12
<PAGE>

Payment would be payable hereunder, and the Executive shall be entitled to
settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

          (d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 8(c), the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject
to the Company's complying with the requirements of Section 8(c)) promptly
pay to the Company the amount of such refund (together with any interest paid
or credited thereon after taxes applicable thereto). If, after the receipt by
the Executive of an amount advanced by the Company pursuant to Section 8(c),
a determination is made that the Executive shall not be entitled to any
refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to
the expiration of 30 days after such determination, then such advance shall
be forgiven and shall not be required to be repaid and the amount of such
advance shall offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid.

          SECTION 9. CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or the affiliated
companies, and their respective businesses, which information, knowledge or
data shall have been obtained by the Executive during the Executive's
employment by the Company or the affiliated companies and which information,
knowledge or data shall not be or become public knowledge (other than by acts
by the Executive or representatives of the Executive in violation of this
Agreement). After termination of the Executive's employment with the Company,
the Executive shall not, without the prior written consent of the Company or
as may otherwise be required by law or legal process, communicate or divulge
any such information, knowledge or data to anyone other than the Company and
those persons designated by the Company. In no event shall an asserted
violation of the provisions of this Section 9 constitute a basis for
deferring or withholding any amounts otherwise payable to the Executive under
this Agreement. In addition, the Executive shall continue to be bound by the
Noncompetition, Nondisclosure and Inventions Agreement between the Executive
and Investors Bank & Trust Company (the "Noncompetition Agreement");
PROVIDED, HOWEVER, that notwithstanding anything to the contrary contained in
the Noncompetition Agreement or in any other agreement between the Executive
and the Company or any of its affiliated companies, the provisions of Section
1 of the Noncompeition Agreement shall be inapplicable and of no further
force and effect upon any termination of the Executive's employment following
a Change of Control.

          SECTION 10. SUCCESSORS. (a) This Agreement is personal to the
Executive, and, without the prior written consent of the Company, shall not
be assignable by the Executive other than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable
by the Executive's legal representatives.

          (b) This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns.

                                       13
<PAGE>

          (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place. "Company" means the Company as hereinbefore
defined and any successor to its business and/or assets as aforesaid that
assumes and agrees to perform this Agreement by operation of law or otherwise.

          SECTION 11. MISCELLANEOUS. (a) This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware, without
reference to principles of conflict of laws. The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified other than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.

          (b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

                  if to the Executive:      At the most recent address on
                                            file at the Company.

                  if to the Company:        Investors Financial Services Corp.
                                            200 Clarendon Street
                                            Boston, MA  02116

                                            Attention:  General Counsel

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

          (c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

          (d) The Company may withhold from any amounts payable under this
Agreement such United States federal, state or local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.

          (e) The Executive's or the Company's failure to insist upon strict
compliance with any provision of this Agreement or the failure to assert any
right the Executive or the Company may have hereunder, including, without
limitation, the right of the Executive to terminate employment for Good
Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to
be a waiver of such provision or right or any other provision or right of
this Agreement.

                                       14
<PAGE>

          (f) The Executive and the Company acknowledge that, except as may
otherwise be provided under any other written agreement between the Executive
and the Company, the employment of the Executive by the Company is "at will"
and, subject to Section 1(a), prior to the Effective Date, the Executive's
employment may be terminated by either the Executive or the Company at any
time prior to the Effective Date, in which case the Executive shall have no
further rights under this Agreement. From and after the Effective Date, this
Agreement shall supersede any other agreement between the parties with
respect to the subject matter hereof, other than Sections 2(D)(ii) through
(iii) and Section 19 of the Employment Agreement between the Executive, the
Company and Investors Bank & Trust Company, dated as of May 16, 2000.

                                       15

<PAGE>

          IN WITNESS WHEREOF, the Executive has hereunto set the Executive's
hand and, pursuant to the authorization from the Board, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

                                             ---------------------------
                                             John E. Henry

                                             INVESTORS FINANCIAL SERVICES CORP.

                                              ----------------------------
                                               Name:
                                               Title:

                                       16

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