Form of Addendum to Incentive Stock Option Agreement with Certain Officers with Employment Agreements

Exhibit 10.32

Form of Addendum to Incentive Stock Option Agreement
with
Certain Officers with Employment Agreements

      [In accordance with the employment agreements of Messrs. Blair, Naughton, Sargeant and Horey, the Company enters into the following addendum to all Incentive Stock Option Agreements with such individuals.]

     This Addendum to Incentive Stock Option Agreement is dated as of                      .

     Reference is made to the following agreement (the “Unmodified Incentive Stock Option Agreement”):

Incentive Stock Option Agreement between                      (“Employee”) and AvalonBay Communities, Inc. (“AvalonBay”), dated                      , with respect to                stock options (the “Options”) having an exercise price of $___.

Capitalized terms used herein and not defined herein have the meanings set forth in the Unmodified Incentive Stock Option Agreement.

     For the convenience of AvalonBay, the Unmodified Incentive Stock Option Agreement is in a standard format commonly used by AvalonBay. However, this Addendum to Incentive Stock Option Agreement (the “Addendum”) contains one or more provisions (the “Modifications”) approved by the Board of Directors of AvalonBay (the “Board”) that are inconsistent with the terms of the Unmodified Incentive Stock Option Agreement. The Board approved the Modifications at the time it approved the grant of the Options to Employee, and for ease of administration the Company is documenting the grant of the Options with the Modificati