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                                                                     EXHIBIT 4.1

                                INCENTIVE PLAN OF
                           EDGE PETROLEUM CORPORATION

           (AS AMENDED AND RESTATED EFFECTIVE AS OF DECEMBER 4, 2003)

         1. Plan. This Incentive Plan of Edge Petroleum Corporation (the "Plan")
was adopted by Edge Petroleum Corporation to reward certain corporate officers
and key employees of Edge Petroleum Corporation and certain independent
consultants by enabling them to acquire shares of common stock of Edge Petroleum
Corporation.

         2. Objectives. This Plan is designed to attract and retain key
employees of the Company and its Subsidiaries (as hereinafter defined), to
attract and retain qualified directors of the Company, to attract and retain
consultants and other independent contractors, to encourage the sense of
proprietorship of such employees, directors and independent contractors and to
stimulate the active interest of such persons in the development and financial
success of the Company and its Subsidiaries. These objectives are to be
accomplished by making Awards (as hereinafter defined) under this Plan and
thereby providing Participants (as hereinafter defined) with a proprietary
interest in the growth and performance of the Company and its Subsidiaries.

         3. Definitions. As used herein, the terms set forth below shall have
the following respective meanings:

         "Annual Director Award Date" means, for each year beginning on or after
the IPO Closing Date, the first business day of the month next succeeding the
date upon which the annual meeting of stockholders of the Company is held in
such year.

         "Authorized Officer" means the Chairman of the Board or the Chief
Executive Officer of the Company (or any other senior officer of the Company to
whom either of them shall delegate the authority to execute any Award
Agreement).

         "Award" means an Employee Award, a Director Award or an Independent
Contractor Award.

         "Award Agreement" means any Employee Award Agreement, Director Award
Agreement or Independent Contractor Award Agreement.

         "Board" means the Board of Directors of the Company.

         "Cash Award" means an award denominated in cash.

         "Code" means the Internal Revenue Code of 1986, as amended from time to
time.

         "Committee" means the Compensation Committee of the Board or such other
committee of the Board as is designated by the Board to administer the Plan.

         "Common Stock" means the Common Stock, par value $.01 per share, of the
Company.

         "Company" means Edge Petroleum Corporation, a Delaware corporation.

         "Director" means an individual serving as a member of the Board.

         "Director Award" means the grant of a Director Option or a Director
Stock Award.

         "Director Award Agreement" means a written agreement between the
Company and a Participant who is a Nonemployee Director setting forth the terms,
conditions and limitations applicable to a Director Award.

         "Director Stock Award" means a Stock Award granted to a Non-employee
Director pursuant to the applicable terms, conditions and limitations specified
in paragraph 9(b) hereof.

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         "Disability" means, with respect to a Non-employee Director, the
inability to perform the duties of a Director for a continuous period of more
than three months by reason of any medically determinable physical or mental
impairment.

         "Dividend Equivalents" means, with respect to shares of Restricted
Stock that are to be issued at the end of the Restriction Period, an amount
equal to all dividends and other distributions (or the economic equivalent
thereof) that are payable to stockholders of record during the Restriction
Period on a like number of shares of Common Stock.

         "Employee" means an employee of the Company or any of its Subsidiaries
and an individual who has agreed to become an Employee of the Company or any of
its Subsidiaries and actually becomes such an Employee within the following six
months.

         "Employee Award" means the grant of any Option, SAR, Stock Award, Cash
Award or Performance Award, whether granted singly, in combination or in tandem,
to a Participant who is an Employee pursuant to such applicable terms,
conditions and limitations as the Committee may establish in order to fulfill
the objectives of the Plan.

         "Employee Award Agreement" means a written agreement between the
Company and a Participant who is an Employee setting forth the terms, conditions
and limitations applicable to an Employee Award.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.

         "Fair Market Value" of a share of Common Stock means, as of a
particular date, (i) if shares of Common Stock are listed on a national
securities exchange, the mean between the highest and lowest sales price per
share of Common Stock on the consolidated transaction reporting system for the
principal national securities exchange on which shares of Common Stock are
listed on that date, or, if there shall have been no such sale so reported on
that date, on the last preceding date on which such a sale was so reported, (ii)
if shares of Common Stock are not so listed but are quoted on the Nasdaq
National Market, the mean between the highest and lowest sales price per share
of Common Stock reported by the Nasdaq National Market on that date, or, if
there shall have been no such sale so reported on that date, on the last
preceding date on which such a sale was so reported, (iii) if the Common Stock
is not so listed or quoted, the mean between the closing bid and asked price on
that date, or, if there are no quotations available for such date, on the last
preceding date on which such quotations shall be available, as reported by the
Nasdaq Stock Market, or, if not reported by the Nasdaq Stock Market, by the
National Quotation Bureau Incorporated or (iv) if shares of Common Stock are not
publicly traded, the most recent value determined by an independent appraiser
appointed by the Company for such purpose; provided that, notwithstanding the
foregoing, "Fair Market Value" in the case of any Award made in connection with
the IPO, means the price per share to the public of the Common Stock in the IPO,
as set forth in the final prospectus relating to the IPO.

         "Incentive Option" means an Option that is intended to comply with the
requirements set forth in Section 422 of the Code. "Independent Contractor"
means a person providing services to the Company or any of its Subsidiaries
except an Employee or Non-employee Director.

         "Independent Contractor Award" means the grant of any Nonqualified
Stock Option, SAR, Stock Award, Cash Award or Performance Award, whether granted
singly, in combination or in tandem, to a Participant who is an Independent
Contractor pursuant to such applicable terms, conditions and limitations as the
Committee may establish in order to fulfill the objectives of the Plan.

         "Independent Contractor Award Agreement" means a written agreement
between the Company and a Participant who is an Independent Contractor setting
forth the terms, conditions and limitations applicable to an Independent
Contractor Award.

         "IPO" means the first time a registration statement filed under the
Securities Act of 1933 and respecting an underwritten primary offering by the
Company of shares of Common Stock is declared effective under that Act and the
shares registered by that registration statement are issued and sold by the
Company (otherwise than pursuant to the exercise of any over-allotment option).

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         "IPO Closing Date" means the date on which the Company first receives
payment for the shares of Common Stock it sells in the IPO.

         "Non-employee Director" has the meaning set forth in paragraph 4(b)
hereof.

         "Nonqualified Stock Option" means an Option that is not an Incentive
Option.

         "Option" means a right to purchase a specified number of shares of
Common Stock at a specified price.

         "Participant" means an Employee, Director or Independent Contractor to
whom an Award has been made under this Plan.

         "Performance Award" means an award made pursuant to this Plan to a
Participant who is an Employee or Independent Contractor who is subject to the
attainment of one or more Performance Goals.

         "Performance Goal" means a standard established by the Committee, to
determine in whole or in part whether a Performance Award shall be earned.

         "Restricted Stock" means any Common Stock that is restricted or subject
to forfeiture provisions.

         "Restriction Period" means a period of time beginning as of the date
upon which an Award of Restricted Stock is made pursuant to this Plan and ending
as of the date upon which the Common Stock subject to such Award is no longer
restricted or subject to forfeiture provisions.

         "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act, or
any successor rule.

         "SAR" means a right to receive a payment, in cash or Common Stock,
equal to the excess of the Fair Market Value or other specified valuation of a
specified number of shares of Common Stock on the date the right is exercised
over a specified strike price, in each case, as determined by the Committee.

         "Stock Award" means an award in the form of shares of Common Stock or
units denominated in shares of Common Stock.

         "Subsidiary" means (i) in the case of a corporation, any corporation of
which the Company directly or indirectly owns shares representing more than 50%
of the combined voting power of the shares of all classes or series of capital
stock of such corporation which have the right to vote generally on matters
submitted to a vote of the stockholders of such corporation and (ii) in the case
of a partnership or other business entity not organized as a corporation, any
such business entity of which the Company directly or indirectly owns more than
50% of the voting, capital or profits interests (whether in the form of
partnership interests, membership interests or otherwise).

4. Eligibility.

         (a) Employees. Key Employees eligible for Employee Awards under this
Plan are those who hold positions of responsibility and whose performance, in
the judgment of the Committee, can have a significant effect on the success of
the Company and its Subsidiaries, including those individuals who are expected
to become Employees within six months.

         (b) Directors. Directors eligible for Director Awards under this Plan
are those who are not employees of the Company or any of its Subsidiaries
("Non-employee Directors").

         (c) Independent Contractors. Independent Contractors eligible for
Independent Contractor Awards under this Plan are those Independent Contractors
providing services to, or who will provide services to, the Company or any of
its Subsidiaries.

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         5. Common Stock Available for Awards. Subject to the provisions of
paragraph 15 hereof, there shall be available for Awards under this Plan granted
wholly or partly in Common Stock (including rights or options that may be
exercised for or settled in Common Stock) an aggregate of 1,700,000 shares of
Common Stock, all of which shall be available for Incentive Options. The number
of shares of Common Stock that are the subject of Awards under this Plan, that
are forfeited or terminated, expire unexercised, are settled in cash in lieu of
Common Stock or in a manner such that all or some of the shares covered by an
Award are not issued to a Participant or are exchanged for Awards that do not
involve Common Stock, shall again immediately become available for Awards
hereunder. The Committee may from time to time adopt and observe such procedures
concerning the counting of shares against the Plan maximum as it may deem
appropriate. The Board and the appropriate officers of the Company shall from
time to time take whatever actions are necessary to file any required documents
with governmental authorities, stock exchanges and transaction reporting systems
to ensure that shares of Common Stock are available for issuance pursuant to
Awards.

         6. Administration.

         (a) This Plan, as it applies to Participants who are Employees or
Independent Contractors but not with respect to Participants who are
Non-employee Directors, shall be administered by the Committee. To the extent
required in order for Employee Awards to be exempt from Section 16 of the
Exchange Act by virtue of the provisions of Rule 16b-3, the Committee shall
consist of at least two members of the Board who meet the requirements of the
definition of "non-employee director" set forth in Rule 16b-3(b)(3)(i)
promulgated under the Exchange Act.

         (b) Subject to the provisions hereof, insofar as this Plan relates to
the Employee Awards or Independent Contractor Awards, the Committee shall have
full and exclusive power and authority to administer this Plan and to take all
actions that are specifically contemplated hereby or are necessary or
appropriate in connection with the administration hereof. Insofar as this Plan
relates to Employee Awards or Independent Contractor Awards, the Committee shall
also have full and exclusive power to interpret this Plan and to adopt such
rules, regulations and guidelines for carrying out this Plan as it may deem
necessary or proper, all of which powers shall be exercised in the best
interests of the Company and in keeping with the objectives of this Plan. The
Committee may, in its discretion, provide for the extension of the
exercisability of an Employee Award or Independent Contractor Award, accelerate
the vesting or exercisability of an Employee Award or Independent Contractor
Award, eliminate or make less restrictive any restrictions contained in an
Employee Award or Independent Contractor Award, waive any restriction or other
provision of this Plan (insofar as such provision relates to Employee Awards or
to Independent Contractor Awards) or an Employee Award or Independent Contractor
Award or otherwise amend or modify an Employee Award or Independent Contractor
Award in any manner that is either (i) not adverse to the Participant to whom
such Employee Award or Independent Contractor Award was granted or (ii)
consented to by such Participant. The Committee may make an award to an
individual who it expects to become an Employee of the Company or any of its
Subsidiaries within the next six months, with such award being subject to the
individuals actually becoming an Employee within such time period, and subject
to such other terms and conditions as may be established by the Committee. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in this Plan or in any Employee Award or Independent Contractor
Award in the manner and to the extent the Committee deems necessary or desirable
to further the Plan purposes. Any decision of the Committee in the
interpretation and administration of this Plan shall lie within its sole and
absolute discretion and shall be final, conclusive and binding on all parties
concerned.

         (c) No member of the Committee or officer of the Company to whom the
Committee has delegated authority in accordance with the provisions of paragraph
7 of this Plan shall be liable for anything done or omitted to be done by him or
her, by any member of the Committee or by any officer of the Company in
connection with the performance of any duties under this Plan, except for his or
her own willful misconduct or as expressly provided by statute.

         7. Delegation of Authority. The Committee may delegate to the Chief
Executive Officer and to other senior officers of the Company its duties under
this Plan pursuant to such conditions or limitations as the Committee may
establish, except that the Committee may not delegate to any person the
authority to grant Awards to, or take other action with respect to, Participants
who are subject to Section 16 of the Exchange Act.

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         8. Employee and Independent Contractor Awards.

         (a) The Committee shall determine the type or types of Employee Awards
to be made under this Plan and shall designate from time to time the Employees
who are to be the recipients of such Awards. Each Employee Award may be embodied
in an Employee Award Agreement, which shall contain such terms, conditions and
limitations as shall be determined by the Committee in its sole discretion and
shall be signed by the Participant to whom the Employee Award is made and by an
Authorized Officer for and on behalf of the Company. Employee Awards may consist
of those listed in this paragraph 8(a) hereof and may be granted singly, in
combination or in tandem. Employee Awards may also be made in combination or in
tandem with, in replacement of, or as alternatives to, grants or rights under
this Plan or any other employee plan of the Company or any of its Subsidiaries,
including the plan of any acquired entity. An Employee Award may provide for the
grant or issuance of additional, replacement or alternative Employee Awards upon
the occurrence of specified events, including the exercise of the original
Employee Award granted to a Participant. All or part of an Employee Award may be
subject to conditions established by the Committee, which may include, but are
not limited to, continuous service with the Company and its Subsidiaries,
achievement of specific business objectives, increases in specified indices,
attainment of specified growth rates and other comparable measurements of
performance. Upon the termination of employment by a Participant who is an
Employee, any unexercised, deferred, unvested or unpaid Employee Awards shall be
treated as set forth in the applicable Employee Award Agreement.

                  (i) Stock Option. An Employee Award may be in the form of an
Option. An Option awarded pursuant to this Plan may consist of an Incentive
Option or a Nonqualified Option. The price at which shares of Common Stock may
be purchased upon the exercise of an Incentive Option shall be not less than the
Fair Market Value of the Common Stock on the date of grant. The price at which
shares of Common Stock may be purchased upon the exercise of a Nonqualified
Option shall be not less than the Fair Market Value of the Common Stock on the
date of grant. Subject to the foregoing provisions, the terms, conditions and
limitations applicable to any Options awarded pursuant to this Plan, including
the term of any Options and the date or dates upon which they become
exercisable, shall be determined by the Committee.

                  (ii) Stock Appreciation Right. An Employee Award may be in the
form of an SAR. The terms, conditions and limitations applicable to any SARs
awarded pursuant to this Plan, including the term of any SARs and the date or
dates upon which they become exercisable, shall be determined by the Committee.

                  (iii) Stock Award. An Employee Award may be in the form of a
Stock Award. The terms, conditions and limitations applicable to any Stock
Awards granted pursuant to this Plan shall be determined by the Committee.

                  (iv) Cash Award. An Employee Award may be in the form of a
Cash Award. The terms, conditions and limitations applicable to any Cash Awards
granted pursuant to this Plan shall be determined by the Committee.

                  (v) Performance Award. Without limiting the type or number of
Employee Awards that may be made under the other provisions of this Plan, an
Employee Award may be in the form of a Performance Award. A Performance Award
shall be paid, vested or otherwise deliverable solely on account of the
attainment of one or more pre-established, objective Performance Goals
established by the Committee prior to the earlier to occur of (x) 90 days after
the commencement of the period of service to which the Performance Goal relates
and (y) the lapse of 25% of the period of service (as scheduled in good faith at
the time the goal is established), and in any event while the outcome is
substantially uncertain. A Performance Goal is objective if a third party having
knowledge of the relevant facts could determine whether the goal is met. Such a
Performance Goal may be based on one or more business criteria that apply to the
individual, one or more business units of the Company, or the Company as a
whole, and may include one or more of the following: increased revenue, net
income, stock price, market share, earnings per share, return on equity, return
on assets or decrease in costs. Unless otherwise stated, such a Performance Goal
need not be based upon an increase or positive result under a particular
business criterion and could include, for example, maintaining the status quo or
limiting economic losses (measured, in each case, by reference to specific
business criteria). In interpreting Plan provisions applicable to Performance
Goals and Performance Awards, it is the intent of the Plan to conform with the
standards of Section 162(m) of the Code and Treasury Regulations
1.16227(e)(2)(i), and the Committee in establishing such goals and interpreting
the Plan shall

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be guided by such provisions. Prior to the payment of any compensation based on
the achievement of Performance Goals, the Committee must certify in writing that
applicable Performance Goals and any of the material terms thereof were, in
fact, satisfied. Subject to the foregoing provisions, the terms, conditions and
limitations applicable to any Performance Awards made pursuant to this Plan
shall be determined by the Committee.

         (b) Notwithstanding anything to the contrary contained in this Plan,
the following limitations shall apply to any Employee Awards made hereunder:

                  (i) no Participant may be granted, during any one-year period,
Employee Awards consisting of Options or SARs that are exercisable for more than
135,000 shares of Common Stock;

                  (ii) no Participant may be granted, during any one-year
period, Stock Awards covering or relating to more than 135,000 shares of Common
Stock (the limitation set forth in this clause (ii), together with the
limitation set forth in clause (i) above, being hereinafter collectively
referred to as the "Stock Based Awards Limitations"); and

                  (iii) no Participant may be granted Employee Awards consisting
of cash or in any other form permitted under this Plan (other than Employee
Awards consisting of Options or SARs or otherwise consisting of shares of Common
Stock or units denominated in such shares) in respect of any one-year period
having a value determined on the date of grant in excess of $500,000.

         (c) The Committee shall have the sole responsibility and authority to
determine the type or types of Independent Contractor Awards to be made under
this Plan and may make any such Awards as could be made to an Employee, other
than Incentive Options; provided that the limitations described in paragraph
8(b) shall be inapplicable to Independent Contractor Awards.

         9. Director Awards. Each Non-employee Director of the Company shall be
granted Director Awards in accordance with this paragraph 9 and subject to the
applicable terms, conditions and limitations set forth in this Plan and the
applicable Director Award Agreement. Notwithstanding anything to the contrary
contained herein, Director Awards shall not be made in any year in which a
sufficient number of shares of Common Stock are not available to make such
Awards under this Plan.

         (A) Director Options.

               (I) On the IPO Closing Date, each Non-employee Director shall be
automatically awarded a Director Option for the number of shares of Common Stock
determined in the following table:

<TABLE>
<CAPTION>
               Years of Service With the Company or its Predecessors      Number of Shares Subject to Option
               -----------------------------------------------------      ----------------------------------
<S>                                                                       <C>
                  4 years or greater                                            8,000
                  3 to 4 years                                                  6,000
                  2 to 3 years                                                  4,000
                  2 years or less                                               2,000
</TABLE>

               (II) Each Non-employee Director who was first appointed or
elected to the Board of Directors during the year ended December 31, 2002, shall
be granted a Director Option that: (A) provides for the purchase of 5,000 Shares
of Common Stock; (B) expires (notwithstanding any earlier termination of the
status of the holder as a Non-employee Director) as set forth on Annex A hereto;
(C) vests and becomes exercisable as set forth on Annex A; and (D) has a
purchase price of each share of Common Stock subject to such Director Option as
set forth on Annex A (which in any event is equal to or greater than the Fair
Market Value as of February 20, 2003).

               (III) Effective beginning February 20, 2003, on the date of his
or her first appointment or election to the Board of Directors, a Non-employee
Director may, in the discretion of the Board of Directors, be granted a Director
Option that provides for the purchase of up to 5,000 shares of Common Stock.

               (IV) On each Annual Director Award Date, each Non-employee
Director shall automatically be granted a Director Option that provides for the
purchase of 3,000 shares of Common Stock.

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               (V) Except as provided in or pursuant to (ii): (A) each Director
Option shall have a term of ten years from the date of grant, notwithstanding
any earlier termination of the status of the holder as a Non-employee Director;
(B) the purchase price of each share of Common Stock subject to a Director
Option shall be equal to the Fair Market Value of the Common Stock on the date
of grant; and (C) all Director Options granted after July 27, 1999 shall vest
and become exercisable on the second anniversary of the date of grant.

               (VI) All unvested Director Options shall be forfeited if the
Non-employee Director resigns as a Director without the consent of a majority of
the other Directors.

               Any Award of Director Options shall be embodied in a Director
Award Agreement, which shall contain the terms, conditions and limitations set
forth above and shall be signed by the Participant to whom the Director Options
are granted and by an Authorized Officer for and on behalf of the Company.

               (b) Director Stock Award. On each Annual Director Award Date
after July 27, 1999, each Non-employee Director who was serving as such on the
date immediately preceding the most recent annual meeting of stockholders, shall
automatically be awarded a number of shares of Common Stock, in lieu of one-half
of the annual retainer to be paid to the Non-employee Director for the preceding
twelve months in cash; provided, however, that, in advance of the payment of any
such annual retainer, the Board, in its sole discretion may reduce the
percentage of such annual retainer that is to be paid in Common Stock or may
provide that no portion of such annual retainer shall be paid in Common Stock. A
number of shares of Common Stock (rounded up to the nearest whole number) having
a Fair Market Value equal to 50% (or such lesser percentage as is specified by
the Board) of the annual retainer otherwise to be paid to the Non-employee
Director for the preceding twelve months shall be awarded.

         10. Payment of Awards.

         (a) General. Payment of Employee Awards or Independent Contractor
Awards may be made in the form of cash or Common Stock, or a combination
thereof, and may include such restrictions as the Committee shall determine,
including, in the case of Common Stock, restrictions on transfer and forfeiture
provisions. If payment of an Employee Award or Independent Contractor Award is
made in the form of Restricted Stock, the applicable Award Agreement relating to
such shares shall specify whether they are to be issued at the beginning or end
of the Restriction Period. In the event that shares of Restricted Stock are to
be issued at the beginning of the Restriction Period, the certificates
evidencing such shares (to the extent that such shares are so evidenced) shall
contain appropriate legends and restrictions that describe the terms and
conditions of the restrictions applicable thereto. In the event that shares of
Restricted Stock are to be issued at the end of the Restricted Period, the right
to receive such shares shall be evidenced by book entry registration or in such
other manner as the Committee may determine.

         (b) Deferral. With the approval of the Committee, amounts payable in
respect of Employee Awards or Independent Contractor Awards may be deferred and
paid either in the form of installments or as a lump sum payment. The Committee
may permit selected Participants to elect to defer payments of some or all types
of Employee Awards or Independent Contractor Awards in accordance with
procedures established by the Committee. Any deferred payment of an Employee
Award or Independent Contractor Award, whether elected by the Participant or
specified by the Award Agreement or by the Committee, may be forfeited if and to
the extent that the Award Agreement so provides.

         (c) Dividends and Interest. Rights to dividends or Dividend Equivalents
may be extended to and made part of any Employee Award or Independent Contractor
Award consisting of shares of Common Stock or units denominated in shares of
Common Stock, subject to such terms, conditions and restrictions as the
Committee may establish. The Committee may also establish rules and procedures
for the crediting of interest on deferred cash payments and Dividend Equivalents
for Employee Awards or Independent Contractor Awards consisting of shares of
Common Stock or units denominated in shares of Common Stock.

         (d) Substitution of Awards. At the discretion of the Committee, a
Participant who is an Employee or Independent Contractor may be offered an
election to substitute an Employee Award or Independent Contractor Award for
another Employee Award or Independent Contractor Award or Employee Awards or
Independent Contractor Awards of the same or different type.

                                       7
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         11. Stock Option Exercise. The price at which shares of Common Stock
may be purchased under an Option shall be paid in full at the time of exercise
in cash or, if elected by the optionee, the optionee may purchase such shares by
means of tendering Common Stock or surrendering another Award, including
Restricted Stock or Director Restricted Stock, valued at Fair Market Value on
the date of exercise, or any combination thereof. The Committee shall determine
acceptable methods for Participants who are Employees or Independent Contractors
to tender- Common Stock or other Employee Awards or Independent Contractor
Awards; provided that any Common Stock that is or was the subject of an Employee
Award or Independent Contractor Award may be so tendered only if it has been
held by the Participant for six months. The Committee may provide for procedures
to permit the exercise or purchase of such Awards by use of the proceeds to be
received from the sale of Common Stock issuable pursuant to an Employee Award or
Independent Contractor Award. Unless otherwise provided in the applicable Award
Agreement, in the event shares of Restricted Stock are tendered as consideration
for the exercise of an Option, a number of the shares issued upon the exercise
of the Option, equal to the number of shares of Restricted Stock or Director
Restricted Stock used as consideration therefore, shall be subject to the same
restrictions as the Restricted Stock or Director Restricted Stock so submitted
as well as any additional restrictions that may be imposed by the Committee.

         12. Taxes. The Company shall have the right to deduct applicable taxes
from any Employee Award payment and withhold, at the time of delivery or vesting
of cash or shares of Common Stock under this Plan, an appropriate amount of cash
or number of shares of Common Stock or a combination thereof for payment of
taxes required by law or to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for withholding of such taxes.
The Committee may also permit withholding to be satisfied by the transfer to the
Company of shares of Common Stock theretofore owned by the holder of the
Employee Award with respect to which withholding is required. If shares of
Common Stock are used to satisfy tax withholding, such shares shall be valued
based on the Fair Market Value when the tax withholding is required to be made.
The Committee may provide for loans, on either a short term or demand basis,
from the Company to a Participant who is an Employee or Independent Contractor
to permit the payment of taxes required by law.

         13. Amendment, Modification, Suspension or Termination. The Board may
amend, modify, suspend or terminate this Plan for the purpose of meeting or
addressing any changes in legal requirements or for any other purpose permitted
by law, except that (i) no amendment or alteration that would adversely affect
the rights of any Participant under any Award previously granted to such
Participant shall be made without the consent of such Participant and (ii) no
amendment or alteration shall be effective prior to its approval by the
stockholders of the Company to the extent such approval is then required
pursuant to Rule 16b-3 in order to preserve the applicability of any exemption
provided by such rule to any Award then outstanding (unless the holder of such
Award consents) or to the extent stockholder approval is otherwise required by
applicable legal requirements.

         14. Assignability. Unless otherwise determined by the Committee and
provided in the Award Agreement, no Award or any other benefit under this Plan
constituting a derivative security within the meaning of Rule 16a-1(c) under the
Exchange Act shall be assignable or otherwise transferable except by will or the
laws of descent and distribution or pursuant to a qualified domestic relations
order as defined by the Code or Title I of the Employee Retirement Income
Security Act, or the rules thereunder. The Committee may prescribe and include
in applicable Award Agreements other restrictions on transfer. Any attempted
assignment of an Award or any other benefit under this Plan in violation of this
paragraph 14 shall be null and void.

         15. Adjustments.

         (a) The existence of outstanding Awards shall not affect in any manner
the right or power of the Company or its stockholders to make or authorize any
or all adjustments, recapitalizations, reorganizations or other changes in the
capital stock of the Company or its business or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock (whether or not such issue is prior to, on a parity with or junior to the
Common Stock) or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding of any kind, whether or not of a character similar to that of
the acts or proceedings enumerated above.

         (b) In the event of any subdivision or consolidation of outstanding
shares of Common Stock, declaration of a dividend payable in shares of Common
Stock or other stock split, then, except with respect to the Existing

                                       8
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Options, (i) the number of shares of Common Stock reserved under this Plan, (ii)
the number of shares of Common Stock covered by outstanding Awards in the form
of Common Stock or units denominated in Common Stock, (iii) the exercise or
other price in respect of such Awards, (iv) the appropriate Fair Market Value
and other price determinations for such Awards, (v) the number of shares of
Common Stock covered by Director Options granted pursuant to paragraph 9(a)
hereof and (vi) the Stock Based Awards Limitations shall each be proportionately
adjusted by the Board to reflect such transaction. In the event of any other
recapitalization or capital reorganization of the Company, any consolidation or
merger of the Company with another corporation or entity, the adoption by the
Company of any plan of exchange affecting the Common Stock or any distribution
to holders of Common Stock of securities or property (other than normal cash
dividends or dividends payable in Common Stock), the Board shall make
appropriate adjustments to (i) the number of shares of Common Stock covered by
Awards in the form of Common Stock or units denominated in Common Stock, (ii)
the exercise or other price in respect of such Awards, (iii) the appropriate
Fair Market Value and other price determinations for such Awards, (iv) the
number of shares of Common Stock covered by Director Options granted pursuant to
paragraph 9(a) hereof and (v) the Stock Based Awards Limitations to give effect
to such transaction shall each be proportionately adjusted by the Board to
reflect such transaction; provided that such adjustments shall only be such as
are necessary to maintain the proportionate interest of the holders of the
Awards and preserve, without exceeding, the value of such Awards. In the event
of a corporate merger, consolidation, acquisition of property or stock,
separation, reorganization or liquidation, the Board shall be authorized to
issue or assume Awards by means of substitution of new Awards, as appropriate,
for previously issued Awards or to assume previously issued Awards as part of
such adjustment.

         (c) In the event of a corporate merger, consolidation, acquisition of
property or stock, separation, reorganization or liquidation, the Board may make
such adjustments to outstanding Awards or other provisions for the disposition
of outstanding Awards as it deems equitable, and shall be authorized, in its
discretion, (i) to provide for the substitution of a new Award or other
arrangement (which, if applicable, may be exercisable for such property or stock
as the Board determines) for an outstanding Award or the assumption of an
outstanding Award, regardless of whether in a transaction to which Section
424(a) of the Code applies, (ii) to provide, prior to the transaction, for the
acceleration of the vesting and exercisability of, or lapse of restrictions with
respect to, the outstanding Award and, if the transaction is a cash merger, to
provide for the termination of any portion of the Award that remains unexercised
at the time of such transaction or (iii) to provide for the acceleration of the
vesting and exercisability of an outstanding Award and the cancellation thereof
in exchange for such payment as shall be mutually agreeable to the Participant
and the Board.

         16. Restrictions. No Common Stock or other form of payment shall be
issued with respect to any Award unless the Company shall be satisfied based on
the advice of its counsel that such issuance will be in compliance with
applicable federal and state securities laws. It is the intent of the Company
that grants of Awards under this Plan comply with Rule 16b-3 with respect to
persons subject to Section 16 of the Exchange Act unless otherwise provided
herein or in an Award Agreement, that any ambiguities or inconsistencies in the
construction of such an Award or this Plan be interpreted to give effect to such
intention. Certificates evidencing shares of Common Stock delivered under this
Plan (to the extent that such shares are so evidenced) may be subject to such
stop transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Securities and
Exchange Commission, any securities exchange or transaction reporting system
upon which the Common Stock is then listed or to which it is admitted for
quotation and any applicable federal or state securities law. The Committee may
cause a legend or legends to be placed upon such certificates (if any) to make
appropriate reference to such restrictions.

         17. Unfunded Plan. Insofar as it provides for Awards of cash, Common
Stock or rights thereto, this Plan shall be unfunded. Although bookkeeping
accounts may be established with respect to Participants who are entitled to
cash, Common Stock or rights thereto under this Plan, any such accounts shall be
used merely as a bookkeeping convenience. The Company shall not be required to
segregate any assets that may at any time be represented by cash, Common Stock
or rights thereto, nor shall this Plan be construed as providing for such
segregation, nor shall the Company, the Board or the Committee be deemed to be a
trustee of any cash, Common Stock or rights thereto to be granted under this
Plan. Any liability or obligation of the Company to any Participant with respect
to an Award of cash, Common Stock or rights thereto under this Plan shall be
based solely upon any contractual obligations that may be created by this Plan
and any Award Agreement, and no such liability or obligation of the Company
shall be deemed to be secured by any pledge or other encumbrance on any property
of the Company. Neither the Company

                                       9
<PAGE>
nor the Board nor the Committee shall be required to give any security or bond
for the performance of any obligation that may be created by this Plan.

         18. Governing Law. This Plan and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by mandatory
provisions of the Code or the securities laws of the United States, shall be
governed by and construed in accordance with the laws of the State of Delaware.

         19. Effectiveness. The Plan as hereby amended and restated shall be
effective as of December 4, 2003.

                                       10
<PAGE>
                                     ANNEX A

<TABLE>
<CAPTION>
NAME                       EXPIRATION DATE           VESTING/ EXERCISABILITY (1)        PER SHARE PURCHASE PRICE
------------------         ---------------           ---------------------------        -------------------------
<S>                        <C>                       <C>                                <C>
Joseph R. Musolino         06/03/2012                06/03/2004                         $5.69
Thurmon Andress            01/23/2013                01/23/2005                         $3.88
David F. Work              01/23/2013                01/23/2005                         $3.88
</TABLE>

(1) Options vest and become exercisable in full on the date set forth opposite
the name of the applicable Non-employee Director.

                                       11<PAGE>
                                                                     EXHIBIT 4.5

                              FIRST AMENDMENT TO
                        AMENDED AND RESTATED AGREEMENT

      THIS FIRST AMENDMENT TO AMENDED AND RESTATED AGREEMENT ("Amendment") is
made as of this ____ day of November, 2003 between FEDERAL REALTY INVESTMENT
TRUST ("Trust") and AMERICAN STOCK TRANSFER & TRUST COMPANY (the "Rights
Agent").

                                   RECITALS

      A.    The Trust and the Rights Agent are parties to that certain
Amended and Restated Rights Agreement dated as of March 11, 1999 ("Original
Rights Agreement").

      B.    Pursuant to Section 28 of the Original Rights Agreement, the
Trust and the Rights Agent may amend or supplement from time to time such
provisions of the Original Rights Agreement which the Trust may deem
necessary or desirable, without approval of holders of Rights Certificates
(as defined in the Original Rights Agreement).

      C.    The Trust, pursuant to a resolution duly adopted by its Board of
Trustees, has determined that it is necessary and desirable to amend the
Original Rights Agreement as provided in this Amendment.

      NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Trust and the Rights Agent
hereby agree as follows:

      1.     DEFINITIONS.  Except as otherwise set forth in this Amendment,
each capitalized term used in this Amendment shall have the meanings for such
terms set forth in the Original Rights Agreement.

      2.     DEFINITION OF "AGREEMENT."  From and after the date hereof, all
references in the Original Rights Agreement to the "Agreement" shall mean and
refer to the Original Rights Agreement as modified by this Amendment.

      3.     ACQUIRING PERSON.  Section 1(a) of the Original Rights Agreement
is hereby amended by deleting all references therein to "15%" and replacing
them with "20%."

      4.     REDEMPTION AND TERMINATION.  Section 24(a)(ii) of the Original
Rights Agreement is hereby amended by deleting the reference therein to
"fifteen percent (15%)" and replacing it with "twenty percent (20%)."

      5.     REVIEW BY BOARD OF TRUSTEES.  The Original Rights Agreement is
hereby amended by adding the following new Section 37:

<PAGE>
             Section 37. Review by Board of Trustees.  The Board of
      Trustees shall, at least once every three (3) years, commencing
      in 2003, review this Agreement to determine whether it should be
      continued or revoked.  Following such determination, the Board of
      Trustees shall take actions as they deem appropriate to reflect
      their determination.  The obligations of the Board of Trustees
      under this Section 37 may be delegated to a committee of the
      Board of Trustees.

      6.     SUMMARY OF RIGHTS.  Exhibit B to the Original Rights Agreement
is hereby amended by deleting the reference to "15%" included in the first
paragraph of the section entitled "DISTRIBUTION DATE, TRANSFER OF RIGHTS" and
replacing it with "20%."

      7.     RATIFICATION OF AGREEMENT.  Except as specifically modified by
this Amendment, the Original Rights Agreement remains in full force and
effect and is hereby ratified, confirmed and reaffirmed for all purposes and
in all respects.

      8.     COUNTERPARTS.  This Amendment may be executed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute but one original; provided, however, this Amendment
shall not be effective unless and until signed by the Trust and the Rights
Agent.

                              TRUST:

                              FEDERAL REALTY INVESTMENT TRUST

                              By:
                                    ------------------------------------
                                    Dawn M. Becker
                                    Senior Vice President - General Counsel
                                    and Secretary

                              RIGHTS AGENT:

                              AMERICAN STOCK TRANSFER & TRUST COMPANY

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

                                       2

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