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Form of Option Agreement

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Exhibit 10.1





NON-QUALIFIED SHARE OPTION AGREEMENT





THIS AGREEMENT (this " Agreement" ), dated February 24, 2011 (the " Grant Date" ), is made by and between Tanger Factory Outlet Centers, Inc., a North Carolina corporation, hereinafter referred to as the " Company" , Tanger Properties Limited Partnership, a North Carolina partnership, hereinafter referred to as the " Partnership" , and none , an employee of the Partnership, hereinafter referred to as the " Optionee" ;




WHEREAS, the Company wishes to afford the Optionee the opportunity to purchase its Common Shares;




WHEREAS, the Company wishes to carry out the Amended and Restated Incentive Award Plan of Tanger Factory Outlet Centers, Inc. and Tanger Properties Limited Partnership (the " Plan" ); and




WHEREAS, the Committee, appointed to administer the Plan, has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Non-Qualified Share Option provided for herein to the Optionee as an inducement to enter into or remain in the service of the Partnership and as an incentive for increased efforts during such service, and has advised the Company thereof and instructed the undersigned officers to issue said Option;




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




ARTICLE I

RELATION TO PLAN





This Award is made pursuant to the Plan, all the terms of which are hereby incorporated by reference and made a part of this Agreement. In the event of any conflict between the terms of the Plan and the terms of this Agreement, the terms of the Plan shall govern. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Plan.





ARTICLE II

GRANT OF OPTION





Section 2.1 - Grant of Option





In consideration of the Optionee's agreement to remain in the employ of the Partnership and for other good and valuable consideration, on the date hereof the Company irrevocably grants to the Optionee an option to purchase any part or all of an aggregate of none Common Shares (the " Option" ) upon the terms and conditions set forth in this Agreement.



Section 2.2 - Purchase Price





The purchase price of the Common Shares covered by the Option shall be $26.06 per share without commission or other charge, which is equal to the Fair Market value per Common Share on the Grant Date.



Section 2.3 - Consideration to Company





In consideration of the granting of the Option by the Company, the Optionee agrees to render faithful and efficient services to the Partnership. Nothing in this Agreement or in the Plan shall confer upon the Optionee any right to continue in the employ of the Partnership or shall interfere with or restrict in any way the rights of the Partnership, which are hereby expressly reserved, to discharge the Optionee at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in a written agreement between the Partnership and Optionee.



Section 2.4 - Adjustments in Option





The Optionee acknowledges and agrees that the Option is subject to adjustment, modification and termination in certain events as provided in Section 10.3 of the Plan.




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ARTICLE III

PERIOD OF EXERCISABILITY




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Section 3.1 - Commencement of Exercisability





(a) Subject to Sections 3.1(b), 3.1(c) and 3.3, the Option shall become exercisable in five (5) cumulative installments as follows:




(i) The first installment shall consist of twenty percent (20%) of the Common Shares covered by the Option and shall become exercisable on the first anniversary of the Grant Date.



(ii) The second installment shall consist of twenty percent (20%) of the Common Shares covered by the Option and shall become exercisable on the second anniversary of the Grant Date.



(iii) The third installment shall consist of twenty percent (20%) of the Common Shares covered by the Option and shall become exercisable on the third anniversary of the Grant Date.



(iv) The fourth installment shall consist of twenty percent (20%) of the Common Shares covered by the Option and shall become exercisable on the fourth anniversary of the Grant Date.



(v) The fifth installment shall consist of twenty percent (20%) of the Common Shares covered by the Option and shall become exercisable on the fifth anniversary of the Grant Date.




(b) No portion of the Option that is un-exercisable at Termination of Employment shall thereafter become exercisable, and upon Termination of Employment, the Optionee's rights with respect to such un-exercisable portion shall immediately terminate, and the Optionee shall be entitled to no future payments or benefits with respect thereto.



Section 3.2 - Duration of Exercisability



The installments provided for in Section 3.1(a) are cumulative. Each such installment that becomes exercisable pursuant to Section 3.1(a) shall remain exercisable until it becomes un-exercisable under Section 3.3.



Section 3.3 - Expiration of Option





The Option may not be exercised to any extent by anyone after the first to occur of the following events:




(a) The expiration of ten (10) years from the Grant Date; or



(b) The expiration of thirty (30) days from the date of the Optionee's Termination of Employment by reason of the Partnership's discharge of the Optionee for good cause; or



(c) The expiration of three (3) months from the date of the Optionee's Termination of Employment other than by reason of (i) the Partnership's discharge of the Optionee for good cause, (ii) the Optionee's death or (iii) the Optionee's disability (within the meaning of Section 22(e)(3) of the Code); or



(d) The expiration of one (1) year from the date of the Optionee's Termination of Employment by reason of his death or disability (within the meaning of Section 22(e)(3) of the Code).




ARTICLE IV

EXERCISE OF OPTION





Section 4.1 - Person Eligible to Exercise





During the lifetime of the Optionee, only the Optionee may exercise the Option or any portion thereof. After the death of the Optionee, any exercisable portion of the Option may, prior to the time when the Option becomes un-exercisable under Section 3.3, be exercised by the Optionee's personal representative or by any person empowered to d
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