PROGRESS SOFTWARE CORP /MA
EX-10.6 2008 FISCAL YEAR DIRECTOR COMPENSATION PROGRAM
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<DESCRIPTION>EX-10.6 2008 FISCAL YEAR DIRECTOR COMPENSATION PROGRAM
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit
10.6</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PROGRESS SOFTWARE CORPORATION<BR>
2008 FISCAL YEAR DIRECTOR COMPENSATION PROGRAM</B>
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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Amounts of 2008 Fiscal Year Compensation</U>
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<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
</TR>
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<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
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<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Board Retainer:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" valign="top">$275,000</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit Committee:<BR>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">$25,000 for Chair<BR>
$20,000 for Members
</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nomination and Governance Committee:<BR>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">$10,000 for Chair<BR>
$7,500 for Members
</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
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<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation Committee:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">$15,000 for Chair<BR>
$12,500 for Members
</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Special Litigation Committee:<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(while in use)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">$50,000 for Chair<BR>
$45,000 for Members
</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Board Chairman:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" valign="top">$25,000</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD nowrap valign="top">&nbsp;</TD>
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<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="20%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="75%">&nbsp;</TD>
</TR>
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Form of Payment</U>:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">25% in cash<BR>
75% in equity (35% in fully vested deferred stock units and 40% in
fully vested options), except that the option portion of the last
payment to a director whose directorship terminates for any reason
at the end of, or during, a term shall be paid entirely in
deferred stock units.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Equity</U>:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The number of option shares is determined by dividing the compensation
amount by the grant date Black Scholes value. The number of deferred stock units is
determined by dividing the compensation amount by the grant date closing price of the
Corporation&#146;s common stock.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Timing</U>:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Annual fiscal year compensation will be paid in two installments,
coincident with the April and October dates of the broad-based employee equity grants.
The April payment is for service from December 1 through May&nbsp;31, and the October
payment is for service from June 1 through November&nbsp;30. Amounts paid will be
pro-rated for partial year service, with a fractional month of service rounded to a
whole month. Accordingly, if a director resigns from the Board, is removed from the
Board by a vote, is removed from the Board due to a change in control, or dies in
office, he or she is paid a pro-rated amount for service through date of termination
of service. Similarly a director who joins the Board other than on the first day of
the fiscal year will be paid a pro-rated amount of the annual fiscal year
compensation. The same proration rule will also apply to any partial year
service on any committee.</TD>
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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Initial Director Option Grant</U>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">Each newly elected Director shall receive an option to acquire 25,000 shares of the
Corporation&#146;s common stock at the first April or October grant date following his or her
election to the Board. The vesting is over a 60-month period and begins on the first day
of the month following the month the Director joins the Board, with full acceleration upon
a change in control. The terms of the option shall be similar to terms of employee options.
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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">C.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Stock Retention Guidelines</U>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">All non-employee Directors must hold 10,000 shares of the Corporation&#146;s common stock or
deferred stock units. Directors have three years to attain this guideline.
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