Document:

EXHIBIT 10.2

 

LOAN MODIFICATION AGREEMENT

 

This Loan
Modification Agreement  (this “Loan
Modification Agreement”) is entered into as of June29, 2005, with an effective
date of May 31, 2005, by and between SILICON
VALLEY BANK, a California-chartered bank, with its principal place
of business at 3003 Tasman Drive, Santa Clara, California 95054 and with a
loan production office located at One Newton Executive Park, Suite 200,
2221 Washington Street, Newton, Massachusetts 02462, doing business under the
name “Silicon Valley East” (“Bank”) and SATCON
TECHNOLOGY CORPORATION, a Delaware corporation with offices located
at 27 Drydock Avenue, Boston, Massachusetts 02210 (FAX 617-897-2401); SATCON POWER SYSTEMS, INC., Delaware
corporation with offices located at 27 Drydock Avenue, Boston, Massachusetts
02210; SATCON APPLIED TECHNOLOGY, INC.,
a Delaware corporation with offices located at 27 Drydock Avenue, Boston,
Massachusetts 02210; SATCON ELECTRONICS, INC.,
a Delaware corporation with offices located at 27 Drydock Avenue, Boston,
Massachusetts 02210; and SATCON POWER SYSTEMS
CANADA LTD., a corporation organized under the laws of the Province
of Ontario, Canada with offices located at 35 Harrington Court, Burlington,
Ontario L7N 3P3 (jointly and severally, individually and collectively, “Borrower”).

 

1.                                       DESCRIPTION
OF EXISTING INDEBTEDNESS AND OBLIGATIONS. Among other indebtedness and
obligations which may be owing by Borrower to Bank, Borrower is indebted to
Bank pursuant to a loan arrangement dated as of January 31, 2005,
evidenced by, among other documents,  a certain Loan and Security Agreement
dated as of January 31, 2005 between Borrower and Bank, as amended (the “Loan
Agreement”).  Capitalized terms used but
not otherwise defined herein shall have the same meaning as in the Loan
Agreement.

 

2.                                       DESCRIPTION
OF COLLATERAL.  Repayment of the
Obligations is secured by the Collateral as described in the Loan Agreement and
a certain Intellectual Property Security Agreement dated January 31, 2005
(the “IP Agreement”)  (together
with any other collateral security granted to Bank, the “Security Documents”).

 

Hereinafter,
the Security Documents, together with all other documents evidencing or
securing the Obligations shall be referred to as the “Existing Loan Documents”.

 

3.                                       DESCRIPTION
OF CHANGE IN TERMS.

 

Modification to Loan Agreement.

 

A.                                   Section 1
of the Schedule to the Loan Agreement is hereby amended by deleting the
following text appearing therein in its entirety:

 

“Borrower
acknowledges that (i) Silicon will make no advances under this Agreement
unless and until it has received an audit of the Collateral in form and
substance satisfactory to Silicon, and (ii) Silicon will make no advances
under this Agreement based upon Borrower’s Eligible Inventory unless and until
it has received an appraisal of Borrower’s Inventory in form and substance
satisfactory to Silicon performed by an independent auditor that is acceptable
to Silicon in its sole discretion.”

 

and
substituting the following text therefor:

 

“Borrower
acknowledges that (i) Silicon will make no advances under this Agreement
unless and until it has received an audit of the Collateral in form and
substance satisfactory to Silicon, and (ii) Silicon will make no advances
under this Agreement based upon Borrower’s Eligible Inventory unless and until (a) it
has received an appraisal of Borrower’s Inventory in form and substance
satisfactory to Silicon performed by an independent auditor that is acceptable
to Silicon in its sole discretion, and (b) prior to each request for
an advance under this Agreement based upon Borrower’s Eligible Inventory, Borrower
furnishes Silicon with evidence satisfactory to Silicon, in 

 

 

Silicon’s sole
discretion, that Borrower has achieved earnings before interest, taxes,
depreciation and amortization of at least $1.00 for the immediately preceding
three month period.”

 

B.                                     Section 5
of the Schedule to the Loan Agreement is hereby amended by deleting the following
text appearing therein:

 

“(Section 5.1):                     Borrower
shall comply with each of the following covenant(s).  Compliance shall be determined as of the end
of each month, except as otherwise specifically provided below:

 

a.
Minimum Tangible Net Worth:

 

Borrower
shall maintain an Tangible Net Worth of not less than
the sum of (i) plus (ii) below:

 

	
  (i)

  	
   

  	
  (a)

  	
   

  	
  from
  October 1, 2004 through and including October 31, 2004 -
  $9,000,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
   

  	
  from
  November 1, 2004 through November 30, 2004 - $8,250,000.00;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (c)

  	
   

  	
  (c) from
  December 1, 2004 through December 31, 2004 - $12,500,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (d)

  	
   

  	
  from
  January 1, 2005 through January 31, 2005 - $11,750,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (e)

  	
   

  	
  from
  February 1, 2005 through February 28, 2005 - $11,000,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (f)

  	
   

  	
  from
  March  1, 2005 through March 31, 2005 - $12,500,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (g)

  	
   

  	
  from
  April 1, 2005 through April 30, 2005 - $11,750,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (h)

  	
   

  	
  from
  May 1, 2005 through May 31, 2005 - $11,000,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
   

  	
  from
  June 1, 2005 through June 30, 2005 - $12,500,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (j)

  	
   

  	
  from
  July 1, 2005 through July 31, 2005 - $11,750,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (k)

  	
   

  	
  from
  August 1, 2005 through August 31, 2005 - $11,000,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (l)

  	
   

  	
  from
  September 1, 2005 through September 30, 2005 - $12,500,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (m)

  	
   

  	
  from
  October 1, 2005 through October 31, 2005 - $11,750,000;

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (n)

  	
   

  	
  from
  November 1, 2005 through November 30, 2005 - $11,000,000; and

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (o)

  	
   

  	
  from
  December 1, 2005 through December 31, 2005 - $12,500,000

  

 

(ii)                                  80%
of all consideration received in addition to those amount
to be received pursuant to the Capitalization Event (as defined in Section 8
(4) of this Schedule to Loan and Security Agreement) from proceeds
from the issuance of any equity securities of the Borrower and/or subordinated
debt incurred by the Borrower.

 

2

 

b.
Minimum Cash or Excess Availability:

 

The Borrower shall at all times maintain $400,000.00
in (i) cash deposits maintained at Silicon, and/or (ii) excess “availability”
under this Agreement (net of Loans, Letters of Credit or other indebtedness
under this Agreement), as determined by Silicon based upon the Credit Limit
restrictions set forth in Section 1 above).”

 

and substituting the following
text therefor:

 

“(Section 5.1):                     Borrower
shall comply with each of the following covenants.  Compliance shall be determined as of the end
of each month, except as otherwise specifically provided below:

 

a. Minimum Tangible Net Worth:

 

Borrower
shall maintain a Tangible Net Worth of not less than the sum of (i) plus (ii) below:

 

	
  (i)

  	
  (a)

  	
  at
  June 4, 2005 - $13,000,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  From June 5, 2005
  through July 2, 2005 - $12,750,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  From July 3, 2005
  through August 6, 2005 - $12,600,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  From August 7,
  2005 through September 3, 2005 - $12,300,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  From September 4,
  2005 through September 30, 2005 - $12,300,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  From October  1, 2005 through November 5, 2005 -
  $11,750,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  From November 6,
  2005 through December 3, 2005 - $11,500,000;

  
	
   

  	
   

  	
   

  
	
   

  	
  (h)

  	
  From December 4,
  2005 through December 31, 2005 - $14,500,000; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  From January 1,
  2006 and thereafter - $14,500,000

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
  (a)

  	
  from
  the date of this Agreement through December 3, 2005, 75% of all
  consideration 

  
	
   

  	
  received from proceeds
  from the issuance of any equity securities of the Borrower and/or
  subordinated debt incurred by the Borrower from June 1, 2005 through December 3,
  2005, and (b) from December 4, 2005 and thereafter, 75% of all
  consideration received from proceeds from the issuance of any equity
  securities of the Borrower and/or subordinated debt incurred by the Borrower
  in excess of $4,000,00.00 from December 4, 2005
  and thereafter.

  

 

b. Minimum Cash or Excess Availability:

 

The Borrower shall at all times maintain $2,000,000.00
(which amount shall be reduced to $800,000.00 upon Silicon’s receipt of the
Borrower’s August 6, 2005 month-end financial statements provided that there
is no then existing Default and the Borrower is otherwise in compliance with
all terms and conditions of this Agreement)  in (i) cash deposits maintained at
Silicon, and/or (ii) excess “availability” under this Agreement (net of
Loans, Letters of Credit or other indebtedness under this Agreement), as
determined by Silicon based upon the Credit Limit restrictions set forth in Section 1
above).”

 

3

 

4.                                       WAIVER.  The Bank hereby waives Borrower’s anticipated
default arising from Borrower’s failure to comply with the Tangible Net Worth
requirement set forth in Section 5a. of the Schedule to
the Loan Agreement as of May 31, 2005.  
The Bank’s waiver of Borrower’s compliance with said foregoing
affirmative covenant shall apply only to the foregoing specific period and
shall not constitute a continuing waiver.

 

5.                                       FEES.  Borrower shall pay to Bank a modification fee
equal to Twenty Thousand Dollars ($20,000.00), which fee shall be due on the
date hereof and shall be deemed fully earned as of the date hereof.  Borrower shall also reimburse Bank for all
legal fees and expenses incurred in connection with this amendment to the
Existing Loan Documents.

 

6.                                       RATIFICATION
OF INTELLECTUAL PROPERTY SECURITY AGREEMENT. Borrower hereby ratifies,
confirms, and reaffirms, all and singular, the terms
and conditions of the IP Agreement and acknowledges, confirms and agrees that
the IP Agreement contains an accurate and complete listing of all Intellectual
Property.

 

7.                                       RATIFICATION
OF PERFECTION CERTIFICATES.  Borrower
hereby ratifies, confirms, and reaffirms, all and singular, the terms and
disclosures contained in certain Perfection Certificates delivered to the Bank
on or about January 31, 2005, and acknowledges, confirms and agrees the
disclosures and information provided therein have not changed, as of the date
hereof.

 

8.                                       CONSISTENT
CHANGES.  The Existing Loan Documents are
hereby amended wherever necessary to reflect the changes described above.

 

9.                                       RATIFICATION
OF LOAN DOCUMENTS.  Borrower hereby
ratifies, confirms, and reaffirms all terms and conditions of
all security or other collateral granted to the Bank, and confirms that
the indebtedness secured thereby includes, without limitation, the Obligations.

 

10.                                 NO
DEFENSES OF BORROWER.  Borrower hereby
acknowledges and agrees that Borrower has no offsets, defenses, claims, or
counterclaims against the Bank with respect to the Obligations, or otherwise,
and that if Borrower now has, or ever did have, any offsets, defenses, claims,
or counterclaims against the Bank, whether known or unknown, at law or in
equity, all of tem are hereby expressly WAIVED and Borrower hereby RELEASES the
Bank from any liability thereunder.

 

11.                                 CONTINUING
VALIDITY.  Borrower understands and
agrees that in modifying the existing Obligations, Bank is relying upon
Borrower’s representations, warranties, and agreements, as set forth in the
Existing Loan Documents.  Except as
expressly modified pursuant to this Loan Modification Agreement, the terms of
the Existing Loan Documents remain unchanged and in full force and effect.  Bank’s agreement to modifications to the
existing Obligations pursuant to this Loan Modification Agreement in no way
shall obligate Bank to make any future modifications to the Obligations.  Nothing in this Loan Modification Agreement
shall constitute a satisfaction of the Obligations.  It is the intention of Bank and Borrower to
retain as liable parties all makers of Existing Loan Documents, unless the
party is expressly released by Bank in writing. 
No maker will be released by virtue of this Loan Modification Agreement.

 

12.                                 COUNTERSIGNATURE.  This Loan Modification Agreement shall become
effective only when it shall have been executed by Borrower and Bank.

 

[Remainder of page intentionally left blank]

 

4

 

This Loan
Modification Agreement is executed as a sealed instrument under the laws of the
Commonwealth of Massachusetts as of the date first written above.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  SATCON TECHNOLOGY CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /S/ David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  /David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Title  CEO

  
	
   

  	
   

  
	
   

  	
  SATCON POWER SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /S/ David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  / David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Title  CEO

  
	
   

  	
   

  
	
   

  	
  SATCON APPLIED TECHNOLOGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /S/ David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  / David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Title  CEO

  
	
   

  	
   

  
	
   

  	
  SATCON ELECTRONICS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /S/ David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  / David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Title  CEO

  
	
   

  	
   

  
	
   

  	
  SATCON POWER SYSTEMS CANADA LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /S/ David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  / David B. Eisenhaure

  	
   

  
	
   

  	
   

  
	
   

  	
  Title  CEO

  
											

 

5

 

	
   

  	
  BANK:

  
	
   

  	
   

  
	
   

  	
  SILICON VALLEY BANK, d/b/a

  
	
   

  	
  SILICON VALLEY EAST

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Tramack

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Michael Tramack

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
    Relationship Manager

  	
   

  
								

 

6EXHIBIT 10.3

 

SATCON TECHNOLOGY CORPORATION

INCENTIVE STOCK OPTION AGREEMENT

 

(2005 Incentive Compensation Plan)

 

Agreement

 

1.             Grant of Option.  The attached Notice of Grant of Stock Options
(the “Notice”) and this Incentive Stock Option Agreement evidence the grant by
SatCon Technology Corporation (the “Company”), as of [                     ,
20   ], to the person named in the Notice (the
“Optionee”) an option (the “Option”) to purchase up to that number of shares of
the Company’s Common Stock, par value $0.01 per share, set forth in the Notice
(the “Shares”) at an exercise price per share set forth in the Notice (the “Exercise
Price”).  The Option shall be subject to
the terms and conditions set forth herein. 
The Option was issued pursuant to the Company’s 2005 Incentive
Compensation Plan (the “Plan”), which is incorporated herein for all
purposes.  The Option is an Incentive
Stock Option, and not a Non-Qualified Stock Option.  The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and conditions
hereof and thereof and all applicable laws and regulations.

 

2.             Definitions.  Unless otherwise provided herein, terms used
herein that are defined in the Plan and not defined herein shall have the
meanings attributed thereto in the Plan.

 

3.             Exercise
Schedule.  Except as otherwise
provided in Sections 6 or 9 of
this Agreement, or in the Plan, the Option will become exercisable (“vest”) in
accordance with the schedule set forth in the Notice, provided that the
Continuous Service of the Optionee continues through and on the applicable
vesting date (each, a “Vesting Date”). To the extent that the Option has become
exercisable with respect to a percentage of Shares, the Option may thereafter
be exercised by the Optionee, in whole or in part, at any time or from time to
time prior to the expiration of the Option as provided herein. Except as otherwise specifically provided herein, there shall be no
proportionate or partial vesting in the periods prior to each Vesting Date, and
all vesting shall occur only on the appropriate Vesting Date. Upon the
termination of the Optionee’s Continuous Service with the Company and its
Related Entities, any unvested portion of the Option shall terminate and be
null and void.

 

4.             Method of
Exercise.  The vested portion of this
Option shall be exercisable in whole or in part in accordance with the exercise
schedule set forth in Section 3 hereof by written notice which shall
state the election to exercise the Option, the number of Shares in respect of
which the Option is being exercised, and such other representations and
agreements as to the holder’s investment intent with
respect to such Shares as may be required by the Company pursuant to the
provisions of the Plan.  Such written
notice shall be signed by the Optionee and shall be delivered in person or by
certified mail to the Secretary of the Company. 
The written notice shall be accompanied by payment of the Exercise
Price.  This Option shall be deemed to be
exercised after both (a) receipt by the Company of such written notice
accompanied by the Exercise Price and (b) arrangements that are
satisfactory to the Committee in its sole discretion have been made for
Optionee’s payment to the Company of the amount, if any, that is necessary to be
withheld in accordance with applicable Federal or state withholding
requirements.  No 

 

 

Shares will be issued pursuant
to the Option unless and until such issuance and such exercise shall comply
with all relevant provisions of applicable law, including the requirements of
any stock exchange upon which the Shares then may be traded.

 

5.             Method of
Payment.    Payment of the Exercise
Price shall be by any of the following, or a combination thereof, at the
election of the Optionee:  (a) cash;
(b) check; (c) with Shares that have been held by the Optionee for at
least 6 months (or such other Shares as the Company determines will not cause
the Company to recognize for financial accounting purposes a charge for
compensation expense), (d) pursuant to a “cashless exercise” procedure, by
delivery of a properly executed exercise notice together with such other
documentation, and subject to such guidelines, as the Committee shall require
to effect an exercise of the Option and delivery to the Company by a licensed broker
acceptable to the Company of proceeds from the sale of Shares (or, to the
extent permitted by the Committee, a margin loan) sufficient to pay the
Exercise Price and any applicable income or employment taxes, or (e) such
other consideration or in such other manner as may be determined by the
Committee in its absolute discretion.

 

6.1           Termination of
Options (excluding Outside Non-Employee Directors).  Any unexercised portion of the Option shall
automatically and without notice terminate and become null and void at the time
of the earliest to occur of the following:

 

(a)           unless the Committee
otherwise determines in writing in its sole discretion, three (3) months
after the date on which the Optionee’s Continuous Service with the Company and
its Related Entities is terminated for any reason other than by reason of (i) termination
of the Optionee’s Continuous Service by the Company or a Related Entity for
Cause, (ii) a Disability of the Optionee, or (iii) the Optionee’s
death;

 

(b)           immediately
upon the termination of the Optionee’s Continuous Service with the Company and
its Related Entities for Cause;

 

(c)           twelve (12) months
after the date on which the Optionee’s Continuous Service with the Company and
its Related Entities is terminated by reason of a Disability;

 

(d)           twelve (12) months
after the date of termination of the Optionee’s Continuous Service with the
Company and its Related Entities by reason of the death of the Optionee (or, if
later, three (3) months after the date on which the Optionee shall die if
such death shall occur during the one year period specified in paragraph (c) of
this Section 6); or

 

(e)                                  the tenth (10th) anniversary of the date as of
which the Option is granted.

 

6.2           Termination
of Options (for Outside Non-Employee Directors).  Directors of the Corporation shall have two
years from the date of such cessation in which to exercise any fully vested
options.  Notwithstanding the foregoing,
if the Participant, prior to the Final Exercise Date, violates the
non-competition or confidentiality provisions of any employment contract,
confidentiality and nondisclosure agreement or other agreement between the
Participant and the Company, the right to exercise this option shall terminate
immediately upon such violation.

 

2

 

7.             Transferability.  The Option granted hereby is not transferable
otherwise than by will or under the applicable laws of descent and
distribution, and during the lifetime of the Optionee the Option shall be
exercisable only by the Optionee, or the Optionee’s guardian or legal
representative. In addition, the Option shall not be assigned, negotiated,
pledged or hypothecated in any way (whether by operation of law or otherwise),
and the Option shall not be subject to execution, attachment or similar
process. Upon any attempt to transfer, assign, negotiate, pledge or hypothecate
the Option, or in the event of any levy upon the Option by reason of any
execution, attachment or similar process contrary to the provisions hereof, the
Option shall immediately become null and void. 
The terms of this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

 

8.             No Rights of
Stockholders.  Neither the Optionee
nor any personal representative (or beneficiary) shall be, or shall have any of
the rights and privileges of, a stockholder of the Company with respect to any
shares of Stock purchasable or issuable upon the exercise of the Option, in
whole or in part, prior to the date of exercise of the Option.

 

9.             Acceleration of
Exercisability of Option.

 

(a)                       This
Option shall become immediately fully exercisable in the event that, prior to
the termination of the Option pursuant to Section 6 hereof, and during the
Optionee’s Continuous Service, there is a “Change in Control,” as defined in Section 9(b) of
the Plan.

 

(b)           Notwithstanding the
foregoing, if in the event of a Change in Control the successor company assumes
or substitutes for the Option, the vesting of the Option shall not be
accelerated as described in Section 9(a). 
For the purposes of this paragraph, the Option shall be considered
assumed or substituted for it following the Change in Control the Option or
substituted option confers the right to purchase, for each Share subject to the
Option immediately prior to the Change in Control, the consideration (whether
stock, cash or other securities or property) received in the transaction
constituting a Change in Control by holders of Shares for each Share held on
the effective date of such transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares); provided, however, that if such consideration received
in the transaction constituting a Change in Control is not solely common stock
of the successor company or its parent or subsidiary, the Committee may, with
the consent of the successor company, or its parent or subsidiary, provide that
the consideration to be received upon the exercise or vesting of the Option
will be solely common stock of the successor company or its parent or
subsidiary substantially equal in fair market value to the per share
consideration received by holders of Shares in the transaction constituting a
Change in Control.  The determination of
such substantial equality of value of consideration shall be made by the
Committee in its sole discretion and its determination shall be conclusive and
binding.  Notwithstanding the foregoing,
in the event of a termination of the Optionee’s employment in such successor
company (other than for Cause) within 24 months following such Change in
Control, the option held by the Optionee at the time of the Change in Control
shall be accelerated as described in paragraph (a) of this Section 9.

 

3

 

10.           No Right to
Continued Employment or Service. 
Neither the Option nor this Agreement shall confer upon the Optionee any
right to continued employment or service with the Company or any Related
Entity.

 

11.           Law Governing.  This Agreement shall be governed in
accordance with and governed by the internal laws of the State of Delaware.

 

12.           Interpretation /
Provisions of Plan Control. This Agreement is subject to all the terms,
conditions and provisions of the Plan, including, without limitation, the
amendment provisions thereof, and to such rules, regulations and
interpretations relating to the Plan adopted by the Committee as may be in
effect from time to time. If and to the extent that this Agreement conflicts or
is inconsistent with the terms, conditions and provisions of the Plan, the Plan
shall control, and this Agreement shall be deemed to be modified accordingly.
The Optionee accepts the Option subject to all of the terms and provisions of
the Plan and this Agreement.  The
undersigned Optionee hereby accepts as binding, conclusive and final all
decisions or interpretations of the Committee upon any questions arising under
the Plan and this Agreement.

 

13.           Notices.  Any notice under this Agreement shall be in
writing and shall be deemed to have been duly given when delivered personally
or when deposited in the United States mail, registered, postage prepaid, and
addressed, in the case of the Company, to the Company’s Secretary at 27 Drydock
Avenue, Boston, MA 02110, or if the Company should move its principal office,
to such principal office, and, in the case of the Optionee, to the Optionee’s
last permanent address as shown on the Company’s records, subject to the right
of either party to designate some other address at any time hereafter in a
notice satisfying the requirements of this Section.

 

14.           Incentive Stock
Option Treatment.  The terms of this
Option shall be interpreted in a manner consistent with the intent of the
Company and the Optionee that the Option qualify as an
Incentive Stock Option under Section 422 of the Code.  If any provision of the Plan or this
Agreement shall be impermissible in order for the Option to qualify as an
Incentive Stock Option, then the Option shall be construed and enforced as if such
provision had never been included in the Plan or the Option.  If and to the extent that the number of
Options granted pursuant to this Agreement exceeds the limitations contained in
Section 4(b) of the Plan on the value of Shares with respect to which
this Option may qualify as an Incentive Stock Option, the excess portion of the
Option shall be deemed a Non-Qualified Stock Option.

 

15.           Counterparts.        This Agreement may be executed in two or
more separate counterparts, each of which shall be an original, and all of
which together shall constitute one and the same agreement.

 

4

 

OPTIONEE’S ACKNOWLEDGEMENT

 

The Optionee
acknowledges receipt of a copy of the Plan and represents that he or she has
reviewed the provisions of the Plan and this Option Agreement in their
entirety, is familiar with and understands their terms and provisions, and
hereby accepts this Option subject to all of the terms and provisions of the
Plan and the Option Agreement.  The
Optionee further represents that he or she has had an opportunity to obtain the
advice of counsel prior to executing this Option Agreement.

 

	
  Dated:

  	
   

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  

 

5

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