Exhibit 10.111
December 31, 2008
Peter Karmanos, Jr.
Chairman and Chief Executive Officer
Compuware Corporation
One Campus Martius
Detroit, MI 48226

     Re:   409A Amendment to Consulting/Employment Letter

Dear Peter:
     A new section of the Internal Revenue Code (“Code Section 409A”) classifies
most compensation that is earned in one tax year and paid in a subsequent tax
year as nonqualified deferred compensation. In particular, certain severance
payments under your March 1, 2007 Consulting/Employment Letter (the “Letter
Agreement”) are considered nonqualified deferred compensation. To comply with
Code Section 409A, it is necessary to amend your Letter Agreement prior to
January 1, 2009. In general, the changes provide more specificity regarding
payment dates and may require that you be reimbursed for certain benefits
instead of continuing to participate in the company’s plans. The changes are as
follows:
     1. The first bullet point in Section 3 of the Letter Agreement is amended
and restated in its entirety to read as follows:

  •   The company shall pay you a total of one year’s salary at the amount in
effect on the Retirement Date in annual installments over a four year period on
a monthly basis beginning in the first month after the month of your Retirement
Date (the “Term”). In no event shall such aggregate annual payment be less than
$300,000.00 per year.

     2. The second bullet point in Section 3 of the Letter Agreement is amended
and restated in its entirety to read as follows:

  •   The company shall pay you earned bonuses under the company’s executive
incentive bonus plans in accordance with their terms but no later than the 15th
day of the third month following the company’s fiscal year for which the bonus
is awarded.

     3. The first bullet point of Section 4 of the Letter Agreement is amended
and restated in its entirety to read as follows:

  •   For termination by the company without cause or by you with cause, you
shall receive: (a) bonuses earned through the date of termination, payable in

 

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      accordance with the bonus plan’s terms but no later than the 15th day of
the third month following the company’s fiscal year for which the bonus is
awarded; (b) severance pay equal to the full amount of the base salary that
would have been paid to you over the unexpired portion of the Term in equal
consecutive monthly installments; (c) reimbursement for what would have been the
company’s portion of your monthly COBRA costs under the company’s medical,
dental, vision and hospitalization benefit plans through the unexpired portion
of the Term of the agreement; and (d) all stock options granted shall be fully
vested and exercisable; provided however, that if the unexpired Term exceeds the
COBRA period, following the expiration of the COBRA period, the company shall
reimburse you for what would have been the company’s portion of the monthly cost
of the benefits provided under (c); and provided further, that until the end of
the Term, the company shall provide you with disability and life insurance ,
which shall be through an individual policy if the company is unable to provide
the benefits under its own life and disability plans.

     4. The second bullet point of Section 4 of the Letter Agreement is hereby
amended and restated in its entirety to read as follows:

  •   For termination by you without cause, you shall receive: (a) your salary
through the date of termination, payable on the next payroll date; (b) bonuses
earned through the date of termination, payable in accordance with the bonus
plan’s terms but no later than the 15th day of the third month following the
company’s fiscal year for which the bonus is awarded; and (c) all stock options
granted shall become vested and exercisable in accordance with the company’s
option plans.

     5. The third bullet point of Section 4 of the Letter Agreement is hereby
amended and restated in its entirety to read as follows:

  •   For termination of this Agreement due to your death or disability as
defined under the company’s disability insurance plan,: (a) you (or your estate
or beneficiary, as applicable) shall receive a sum equal to the full amount of
the base salary that would have been paid to you over the unexpired portion of
the Term, payable in equal consecutive monthly installments commencing in the
first month after the month of your employment termination; (b) you and your
spouse, as applicable, shall be reimbursed for COBRA premiums under the
company’s medical, dental, vision and hospitalization benefit plans for
twenty-four (24) months from the date of your death.

     6. A new Section 6 shall be added to the Letter Agreement to read as
follows:
6. If any amounts that become due under this Agreement constitute “nonqualified
deferred compensation” within the meaning of Code Section 409A, payment of such
amounts shall not commence until you incur a “separation from service” within
the meaning of Treasury Regulation Section 1.409A-1(h). If, at the time of your
separation from service, you are a “specified employee” (within the meaning of
Code Section 409A), any benefit

 

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to which Code Section 409A additional taxes could be assessed on account of your
separation from service (including any amounts payable pursuant to the preceding
sentence) will not be paid until after the end of the sixth calendar month
beginning after the your separation from service (the “409A Suspension Period”)
to the extent such delay may reasonably be expected to avoid Code Section 409A
additional taxes. Within fourteen (14) calendar days after the end of the 409A
Suspension Period, you shall be paid a lump sum payment in cash equal to any
payments delayed because of the preceding sentence. Thereafter, you shall
receive any remaining benefits as if there had not been an earlier delay. The
company shall have the sole discretion to interpret the requirements of the
Code, including Code Section 409A, for purposes of this Agreement.
     If you agree and accept the terms of this amendment to your Letter
Agreement, please sign both copies and return one copy for the company’s files.

         
 
  Sincerely,    
 
       
 
  /s/ Daniel S. Follis Jr.
 
Daniel S. Follis Jr., Secretary    
 
       
 
  On behalf of William O. Grabe    
 
  Chairperson, Compensation Committee    

I agree and accept the terms of this amendment to my Letter Agreement:

     
/s/ Peter Karmanos, Jr.
 
Peter Karmanos, Jr.
   
Chairman and CEO
   

Dated: December 31, 2008