Exhibit 10(xiv)(8)

TERMS AND CONDITIONS

2008 PERFORMANCE STOCK UNIT AWARD

UNDER THE AMENDED AND RESTATED

NORTHERN TRUST CORPORATION 2002 STOCK PLAN

Your performance stock unit grant is subject to the provisions of the Amended
and Restated Northern Trust Corporation 2002 Stock Plan (the “Plan”) and the
performance stock unit award notice (the “Award Notice”). The Award Notice and
these Terms and Condition constitute the “Stock Unit Agreement” as defined in
the Plan. If there is any conflict between the information in the Stock Unit
Agreement and the Plan, the Plan will govern.

 

1. Grant. The Corporation hereby grants to the Participant an award of Stock
Units, as set forth in the Award Notice, subject to the terms and conditions of
the Plan and the Stock Unit Agreement, and subject further to increase or
decrease as set forth in the Award Notice. This award of Stock Units is intended
to qualify as “performance based compensation” within the meaning of
Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). A
Stock Unit is the right, subject to the terms and conditions of the Plan and the
Stock Unit Agreement, to receive a distribution of a share of Common Stock
pursuant to Paragraph 6 of these Terms and Conditions.

 

2. Stock Unit Account. The Corporation shall maintain an account (“Stock Unit
Account”) on its books in the name of the Participant which shall reflect the
number of Stock Units awarded to the Participant that the Participant is
eligible to receive in distribution pursuant to Paragraph 6 of these Terms and
Conditions.

 

3. Dividend Equivalents. Upon the payment of any dividend on Common Stock
occurring during the period preceding the distribution of the Participant’s
Stock Unit award pursuant to Paragraph 6 of these Terms and Conditions, the
Corporation shall promptly (and in any event no later than March 15 of the
calendar year following the calendar year in which the dividend is declared) pay
to the Participant an amount in cash equal in value to the dividends that the
Participant would have received had the Participant been the actual owner of the
number of shares of Common Stock represented by the Stock Units in the
Participant’s Stock Unit Account on that date (“Dividend Equivalents”).

 

4. Forfeiture. The Stock Units granted to the Participant pursuant to the
Performance Stock Unit Agreement shall be forfeited and revert to the
Corporation if prior to the date on which the Stock Units vest pursuant to
Paragraphs 5 and 8(c) of these Terms and Conditions (a) the Participant violates
any provision of Paragraph 7 of these Terms and Conditions, or (b) except as
described in Paragraphs 5 and 8 of these Terms and Conditions, the Participant’s
employment with the Corporation or any of its Subsidiaries terminates.

 

5.

Vesting. The Participant shall become vested in the Stock Units as and to the
extent set forth in Exhibit A to these Terms and Conditions, subject to
(a) prorated vesting in accordance with Paragraph 8 of these Terms and
Conditions upon the Participant’s death, Retirement or Disability (each as
defined below) or upon termination of employment under certain circumstances

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described in Paragraph 8 of these Terms and Conditions where the Participant is
entitled to severance benefits, (b) prorated vesting in accordance with
Paragraph 8 of these Terms and Conditions in the event that prior to vesting the
Participant’s employment with the Corporation or any of its Subsidiaries has
terminated and (i) the Participant is a Management Group member on the date of
grant, (ii) the Participant is 55 years or older on the date of termination of
employment and (iii) the Participant has not violated any provision of Paragraph
7 of these Terms and Conditions during the performance period described in
Exhibit A to these Terms and Conditions (“Performance Period”), or (c) full
vesting in the event of a Change in Control (as defined in the Plan) of the
Corporation. If the Participant’s employment with the Corporation or any of its
Subsidiaries terminates for any reason other than as set forth above in this
Paragraph 5, the Stock Units in the Participant’s Stock Unit Account that have
not yet vested shall be forfeited and revert to the Corporation on such
termination date, and the Corporation shall have no further obligation after
such date to pay Dividend Equivalents pursuant to Paragraph 3 of these Terms and
Conditions. If the Participant’s employment terminates for a reason described in
clause (a) or (b) of this Paragraph 5, no Stock Units in the Participant’s Stock
Unit account shall become vested until the end of the Performance Period and
then only to the extent that the performance criteria described in Exhibit A and
the requirements of Paragraph 8 are satisfied, and any such Stock Units that do
not become vested at the end of the Performance Period shall be immediately
forfeited and revert to the Corporation and the Corporation shall have no
further obligations after such date to pay Dividend Equivalents pursuant to
Paragraph 3 of these Terms and Conditions. The Corporation shall have no further
obligation to the Participant under these Terms and Conditions following the
Participant’s forfeiture of Stock Units.

For purposes of these Terms and Conditions, “Retirement” means retirement
occurring by reason of the Participant having qualified for a Normal, Early, or
Postponed Retirement under The Northern Trust Company Pension Plan.

For purposes of these Terms and Conditions, “Disability” means a disability that
continues for a period of 12 months as defined by Northern Trust’s Managed
Disability Program.

 

6. Distribution. Except as provided below in this Paragraph 6, the Participant
shall become entitled to the distribution of the Participant’s Stock Units upon
the date of vesting of the Stock Units pursuant to Paragraphs 5 and 8 of these
Terms and Conditions; provided, however, that any Participant who is subject to
Section 16 of the Securities Exchange Act of 1934 at the time of vesting (a
“Section 16 Participant”) shall become entitled to the distribution of the Stock
Units on the Applicable Date (as defined below) in the year in which the Stock
Units vest pursuant to Paragraphs 5 and 8 of these Terms and Conditions.

In the event of the Participant’s death during the Performance Period or
thereafter but prior to full distribution to the Participant pursuant to these
Terms and Conditions, the Participant’s beneficiary shall become entitled to the
distribution of vested Stock Units, if any, upon the date that is the last day
of such Performance Period, or, if later, as of the date of death, with the
number

 

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of Stock Units vested to be determined in accordance with Paragraph 8 of these
Terms and Conditions, and such distribution shall be made to such beneficiary
and in such proportions as the Participant may designate in writing, and in the
absence of a designation, to the following persons in the order indicated below:

 

  •  

The Participant’s spouse; if none, then,

 

  •  

The Participant’s children (in equal amounts); if none, then,

 

  •  

The Participant’s parents (in equal amounts); if none, then,

 

  •  

The Participant’s brothers and sisters (in equal amounts); if none, then,

 

  •  

The Participant’s estate.

In the event of (a) the Participant’s Retirement or Disability during the
Performance Period, the Participant shall become entitled to the distribution of
any vested Stock Units upon the date that is the last day of such Performance
Period, with the number of Stock Units vested to be determined in accordance
with Paragraph 8 of these Terms and Conditions, or (b) a Change in Control (as
defined in the Plan) during the Performance Period, the Participant shall become
entitled to the distribution of any Stock Units that become vested on account of
the Change in Control upon the date of the Change in Control.

Stock Units shall be distributed only in shares of Common Stock so that,
pursuant to Paragraph 1 of these Terms and Conditions and this Paragraph 6, a
Participant shall be entitled to receive one share of Common Stock for each
Stock Unit in the Participant’s Stock Unit Account.

For purposes of these Terms and Conditions, “Applicable Date” with respect to a
given year means the first trading day of that year, after the vesting of the
Stock Units, on which the Corporation’s trading blackout is not in effect for
the Section 16 Participant, or such other date in that year as the Committee or
the Executive Vice President of Human Resources may determine.

 

7. Restricted Activity. Despite anything to the contrary in Paragraph 5, 6 or 8
of these Terms and Conditions, the Participant’s Stock Units (whether vested or
unvested) shall be forfeited and the Corporation shall have no obligation to
distribute the Stock Units to the Participant (or the Participant’s beneficiary)
pursuant to Paragraph 6, or to pay any Dividend Equivalents pursuant to
Paragraph 3, if the Participant:

 

  (a) at any time after the date of these Terms and Conditions, has divulged,
directly or indirectly, or used for the Participant’s own or another’s benefit,
any Confidential Information; or

 

  (b)

at any time after the date of these Terms and Conditions and through a period of
twelve (12) months after the Participant ceases to be employed by the
Corporation or any of its Subsidiaries for any reason, has Solicited, or
assisted in the Solicitation of, any Client or Prospective Client; or solicited,
encouraged, advised, induced or caused any employee of the Corporation or any of
its Subsidiaries to terminate his or her employment with the Corporation or any
of its Subsidiaries,

 

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or provided any assistance, encouragement, information, or suggestion to any
person or entity regarding the solicitation or hiring of any employee of the
Corporation or any of its Subsidiaries; provided, however, that this clause
(b) shall not prohibit the Participant’s Solicitation of any Client or
Prospective Client with whom he or she had a business relationship prior to the
start of his or her employment with the Corporation, provided that no
Confidential Information, directly or indirectly, is used in such Solicitation.

 

  (c) If the Participant shall have so engaged in any such activity described in
clause (a) or (b) above without the written consent of the Corporation, the
Participant’s Stock Units (whether vested or unvested) shall be forfeited to the
Corporation by notice in writing to the Participant within a reasonable period
of time after the Corporation acquires knowledge of the Participant’s violation
of this Paragraph 7. Any failure by the Participant to comply with this
Paragraph 7 shall entitle the Corporation, as determined by the Committee in its
sole discretion, to (i) cancel and terminate all of the Participant’s
unexercised, unexpired, unpaid or deferred Stock Units (whether vested or
unvested) under the Plan, and (ii) rescind any exercise, payment or delivery
with respect to any Stock Units occurring within twelve (12) months prior to, or
at any time following, the date of the Participant’s termination of employment
for any reason (including but not limited to termination of employment due to
Retirement or Disability). Upon any such rescission, (1) the Participant shall
immediately pay to the Corporation the amount of any gain realized or payment
received, and (2) the Participant shall immediately forfeit to the Corporation
any shares of the Corporation’s Common Stock received, in each case as a result
of the rescinded exercise, payment or delivery with respect to any Stock Units,
in such manner and on such terms and conditions as the Committee shall require,
and the Corporation shall be entitled, as permitted by applicable law, to deduct
from any amounts the Corporation owes the Participant from time to time the
amount of any such gain realized or payment received. “Gain realized” shall be
determined by the Committee in its sole discretion.

 

8. Proration.

 

  (a)

The Participant shall cease to participate in the Plan under these Terms and
Conditions as of the date of the Participant’s death, Disability or Retirement.
If the Participant’s death, Retirement or Disability occurs prior to the end of
the Performance Period, or if prior to the end of the Performance Period, the
Participant’s employment is terminated under circumstances that entitle the
Participant to severance benefits under the Northern Trust Corporation Severance
Plan (the “Severance Plan”) and the Participant has executed and not revoked a
settlement agreement, waiver and release under the Severance Plan (a “Release”),
then, in each such case, subject to clause (c) below, on the last day of the
Performance Period, the Participant shall have credited, and become vested in, a
pro-rated number of Stock Units as determined by multiplying the number of Stock
Units which would have been distributable to the Participant if the Participant
had

 

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participated in the Plan under these Terms and Conditions for the full
Performance Period, by the ratio of the number of full calendar months of the
Participant’s actual participation in the Plan under these Terms and Conditions
during the Performance Period to the number of full calendar months in the
Performance Period, in all cases as determined by the Committee or the Executive
Vice President of Human Resources.

 

  (b) If, prior to the end of the Performance Period, a Participant’s employment
with the Corporation or any of its Subsidiaries has terminated and (i) the
Participant is a Management Group member on the date of grant, (ii) the
Participant is 55 years or older on the date of such termination, and (iii) the
Participant has not violated any provision of Paragraph 7 of these Terms and
Conditions during the Performance Period, then, subject to clause (c) below, on
the last day of the Performance Period, the Participant shall have credited, and
become vested in, a pro-rated number of Stock Units as determined by multiplying
the number of Stock Units which would have been distributable to the Participant
if the Participant had been employed by the Corporation or any of its
Subsidiaries for the full Performance Period, by the ratio of the number of full
calendar months of the Participant’s actual employment by the Corporation or any
of its Subsidiaries under these Terms and Conditions during the Performance
Period to the number of full calendar months in the Performance Period, in all
cases, as determined by the Committee or the Executive Vice President of Human
Resources.

 

  (c) Notwithstanding clauses (a) or (b) above or any other provision of these
Terms and Conditions, there shall be no vesting of any Stock Units and no
proration of any Stock Units until the expiration of the Performance Period, and
then only to the extent it is determined by the Committee that the Corporation
has satisfied the performance criteria for the Performance Period.

 

9. Delivery of Shares. The Corporation may delay the issuance or delivery of any
shares of Common Stock if the Corporation reasonably anticipates that such
issuance or delivery will violate applicable federal securities laws or other
applicable law, provided that the issuance or delivery is made at the earliest
date at which the Corporation reasonably anticipates that such issuance or
delivery will not cause such violation.

 

10. Adjustment. The Stock Units provided herein are subject to adjustment in
accordance with the provisions of Section 11 of the Plan.

 

11. No Right to Employment. Nothing in the Plan or the Stock Unit Agreement
shall be construed as creating any right in the Participant to continued
employment or as altering or amending the existing terms and conditions of
employment of the Participant except as otherwise specifically provided in the
Stock Unit Agreement.

 

12. Nontransferability. No interest hereunder of the Participant is transferable
except as provided in the Stock Unit Agreement.

 

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13. Withholding. The Corporation shall have the right to deduct from any
distribution made hereunder in cash any sum required to be withheld by the
Corporation for federal, state or local taxes. In the case of any distribution
made hereunder in shares of Common Stock, the Corporation requires as a
condition of distribution that the Participant or the Participant’s beneficiary
pay the Corporation the amount which the Corporation determines to be required
to be withheld for federal, state or local taxes. The tax withholding obligation
with respect to shares of Common Stock shall be satisfied by the Corporation’s
withholding a portion of such shares otherwise distributable to the Participant.
Any shares withheld shall be valued at their fair market value as of the date of
distribution.

 

14. Administration. The Plan is administered by the Committee. The rights of the
Participant hereunder are expressly subject to the terms and conditions of the
Plan (including continued shareholder approval of the Plan), together with such
guidelines as have been or may be adopted from time to time by the Committee.
The Participant hereby acknowledges receipt of a copy of the Plan.

 

15. No Rights as Shareholder. Except as provided herein, the Participant will
have no rights as a shareholder with respect to the Stock Units.

 

16. Interpretation. Any interpretation by the Committee of the terms and
conditions of the Plan, the Stock Unit Agreement or any guidelines shall be
final. The Stock Unit Agreement shall be construed under the laws of the State
of Illinois without regard to the conflict of law provisions of any state.

 

17. Sole Agreement. The Stock Unit Agreement, together with the Plan, is the
entire Agreement between the parties hereto, all prior oral and written
representations being merged herein. No amendment or modification of the terms
of the Stock Unit Agreement shall be binding on either party unless reduced to
writing and signed by the party to be bound. The Stock Unit Agreement shall be
binding upon, inure to the benefit of, and be enforceable by the parties hereto
and their respective successors.

 

18. Definitions. Capitalized terms not defined in the Stock Unit Agreement shall
have the meanings assigned to them in the Plan. For purposes of the Stock Unit
Agreement:

 

  (a) “Client” means any person or entity with which the Corporation, or any of
its Subsidiaries, did business and with which the Participant had contact, or
about which the Participant had access to Confidential Information, during the
last twelve (12) months of his or her employment.

 

  (b) “Competitive Service or Product” means any service or product: (i) that is
substantially similar to or competitive with any service or product that the
Participant created or provided, or of which the Participant assisted in the
creation or provision, during his or her employment by the Corporation or any of
its Subsidiaries; or (ii) about which the Participant had access to Confidential
Information during his or her employment by the Corporation or any of its
Subsidiaries.

 

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  (c) “Confidential Information” means any trade secrets or other information,
including, but not limited to, any client information (for example, client
lists, information about client accounts, borrowings, and current or proposed
transactions), any internal analysis of clients, marketing strategies, financial
reports or projections, business or other plans, data, procedures, methods,
computer data or system program or design, devices, lists, tools, or
compilation, which relate to the present or planned business of the Corporation
or any of its Subsidiaries and which has not been made generally known to the
public by authorized representatives of the Corporation.

 

  (d) “Prospective Client” means any person or entity to which the Corporation,
or any of its Subsidiaries, provided, or from which the Corporation, or any of
its Subsidiaries received, a proposal, bid, or written inquiry (general
advertising or promotional materials and mass mailings excepted) and with which
the Participant had contact, or about which the Participant had access to
Confidential Information, during the last twelve (12) months of his or her
employment.

 

  (e) “Solicit” and “Solicitation” (with respect to Clients or Prospective
Clients) mean directly or indirectly, and without the Corporation’s written
authorization, to invite, encourage, request, or induce (or to assist another to
invite, encourage, request or induce) any Client or Prospective Client of the
Corporation, or any of its Subsidiaries, to: (i) surrender, redeem or terminate
a product, service or relationship with the Corporation, or any of its
Subsidiaries; (ii) obtain any Competitive Service or Product from the
Participant or any third party; or (iii) transfer a product, service or
relationship from the Corporation, or any of its Subsidiaries, to the
Participant or any third party.

Dated:                     , 2008

 

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Exhibit A

Subject to Paragraph 5 of Terms and Conditions, the Stock Units will vest if,
when, and to the extent the Corporation satisfies, as the Committee shall
determine in its sole discretion in 2011, the average annual earnings per share
for the three-year performance period beginning on January 1, 2008 and ending on
December 31, 2010, as set forth below.

 

Average Annual

Three-Year

Earnings Per Share

  

Percentage of Stock

Units Vested

12.0% or higher

   125.0%

                11.5%

   117.5%

                11.0%

   110.0%

                10.5%

   105.0%

                10.0%

   100.0%

                  9.5%

   95.0% 

                  9.0%

   90.0% 

                  8.5%

   82.5% 

                  8.0%

   75.0% 

 Less than 8.0%

   0.0%   

“Full vesting” in the event of a Change in Control, as required by Paragraph
5(c) of the Terms and Conditions, shall mean vesting of the Stock Units at the
maximum level (125.0%) in the table above.

The average annual earnings per share shall be the mathematical mean of the
percentage growth in earnings per share for each year in the three-year period
rounded to the nearest one-tenth of a percent. The final percentage of the Stock
Units vesting shall be determined by interpolation between percentage levels.

 

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