**Exhibit10 ZZ**

** **

**OMNIBUS STOCK PLAN**

 

**RESTRICTED STOCK UNIT AWARDAGREEMENT**

 

 

                **AGREEMENT,** made effective as of March 29, 2006 by andbetween Mercantile Bankshares Corporation, a Maryland corporation (“Company”),and Edward J. Kelly (“Award Recipient”):

 

                **WHEREAS**, the Company maintains the Mercantile BanksharesCorporation 1999 Omnibus Stock Plan (“Omnibus Stock Plan”) under which theCompany’s Compensation Committee (“Committee”) of the Board of Directors (“Board”)may, among other things, award restricted stock units (referred to under theOmnibus Stock Plan as Phantom Stock Units), each of which represents the rightto receive one share of the Company’s Common Stock of $2.00 par value (“CommonStock”) to such members of the Company’s management team as the Committee maydetermine, subject to such terms, conditions, or restrictions as the Committeemay deem appropriate; and

 

                **WHEREAS**, pursuant to the Omnibus Stock Plan, the Committee,with the approval of the Board, has granted to the Award Recipient a restrictedstock unit award subject to this Agreement setting forth the terms andconditions applicable to such award in accordance with Article 6 of the OmnibusStock Plan; and

 

                **WHEREAS**, the Award Recipient desires to accept said award inaccordance with the terms and provisions of the Omnibus Stock Plan and thisAgreement.

 

                **NOW,****THEREFORE**, inconsideration of the premises and mutual covenants and agreements containedherein, the Company and Award Recipient agree as follows:

 

**1.             AWARDOF RESTRICTED STOCK UNITS:**

 

                Under the terms ofthe Omnibus Stock Plan, the Committee has granted to the Award Recipient arestricted stock unit award made on March 29, 2006 (“Award Date”), of 104,630restricted stock units (“Award Units”) subject to the terms, conditions, andrestrictions set forth in this Agreement.

 

**2.             AWARDRESTRICTIONS:**

 

                The Award Unitsshall be subject to forfeiture until such units vest in accordance with theprovisions set forth below.  Subject toSections 3 and 4 of this Agreement, the Award Units shall become vested in fourinstallments at the end of four periods of time (each, a “restriction period”),if the Award Recipient shall have been continuously employed by the Company orany of its affiliates throughout the applicable restriction 

 

 

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period.  The number of Award Unitsthat may become vested in each installment, and the applicable restrictionperiods, are set forth below:

 

 
| **Number of Award** | ** ** | **Restriction**   |
|---------------------|------------|-------------------|
| **Units Vesting**   | ** ** | **Period Ending** |
|                |       |              |
| 26,157.5            |       | March 29, 2007    |
| 26,157.5            |       | March 29, 2008    |
| 26,157.5            |       | March 29, 2009    |
| 26,157.5            |       | March 29, 2010    |

 

 

**3.             TERMINATIONOF EMPLOYMENT:**

 

                (a)           If the Award Recipient’s employmentwith the Company or any of its affiliates is terminated by reason of death ortotal and permanent disability, then all Award Units which are then subject torestriction shall be forfeited by the Award Recipient. The Committee shall haveabsolute discretion to determine whether an Award Recipient’s termination ofemployment is due to total and permanent disability.  The Committee may require the Award Recipientto provide whatever evidence the Committee deems desirable to ascertain whetherthe Award Recipient is totally and permanently disabled.

 

                (b)           If the Award Recipient’s employment with the Companyor any of its affiliates is terminated involuntarily without “good cause” as defined in his employment agreement withthe Company and Mercantile-Safe Deposit and Trust Company (or other affiliateof the Company, as applicable), as amended from time to time, during therestriction period, any Award Units which are then subject to restriction shall become fullyvested as of such date of termination of employment.

 

                (c)           If the Award Recipient’s employmentwith the Company or any of its affiliates is terminated for any other reasonduring the restriction period, no Award Units which are then subject torestriction shall become vested and such Award Units shall be forfeited by theAward Recipient.

 

 

**4.             EARLYVESTING  UPON CHANGE OF CONTROL:**

 

**               **In the event of a sale of the Company, any Award Unitswhich are thensubject to restriction shall become fully vested as of such date. For purposesof this Agreement a sale of the Company shall mean:

 

                (a)           The acquisition by any person, entityor “group”, within the meaning of Section 13(d)(3) or 14(d)(2) of the ExchangeAct, (excluding for this purpose, the Company or its affiliates, and excludingany acquisition of securities by any employee 

 

 

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benefit plan of the Company or its affiliates)of beneficial ownership (within the meaning of Rule 13d-3 promulgated under theExchange Act) of 50% or more of either the then outstanding shares of commonstock of the Company or the combined voting power of the Company’s thenoutstanding voting securities entitled to vote generally in the election ofdirectors (such common stock or then outstanding voting securities beingreferred to herein as “Voting Securities”), calculated on the date of thetransaction causing the foregoing 50% test to be met, without regard to anylimitation upon the voting rights of any acquiring person under Marylandstatutes and without regard to the potential exercisability of rights, notexercised on such date, pursuant to any Stockholder Protection Rights Agreementof the Company then in effect; or

 

                (b)           Consummation of (1) a reorganization,merger, consolidation or statutory share exchange, in each case, with respectto which persons who are the holders of the outstanding Voting Securities ofthe Company immediately prior to such reorganization, merger, consolidation orstatutory share exchange do not, immediately thereafter, own more than 50% ofthe combined voting power entitled to vote generally in the election ofdirectors of the entity resulting from such reorganization, merger,consolidation or statutory share exchange, or (2) a liquidation or dissolutionof the Company or the sale of all or substantially all of the assets of theCompany to an entity other than an affiliate.

 

**5.             RIGHTS OF AWARD RECIPIENT REGARDING AWARD UNITS:**

 

                (a)           The Award Recipient shall not havethe rights of a stockholder with respect to any Award Units granted to theAward Recipient until shares of Common Stock have been distributed to the AwardRecipient pursuant to Section 6, and the Award Recipient’s name has beenentered as a stockholder of record on the books of the Company with respect tosuch distributed shares of Common Stock.

 

                (b)           The Award Units and all rights withrespect to shares of Common Stock issued thereunder may not be sold, assigned,transferred, pledged or encumbered in any way prior to the issuance of suchshares to the Award Recipient, other than by will or other instrument takingeffect upon the Award Recipient’s death, or the laws of descent and distribution.

 

                (c)           As long as the Award Recipient holds Award Units grantedpursuant to this Agreement, the Company shall credit to the Award Recipient, oneach date that the Company pays a cash dividend to holders of Common Stockgenerally, an additional number of Award Units (“Dividend Award Units”) determinedby dividing (1) the aggregate dollar value of the cash dividends that the AwardRecipient would have received during the period from the immediately precedingdividend payment date through the current dividend payment date if the AwardRecipient were the owner of record throughout such period of a number of sharesof Common Stock equal to the number of whole Award Units and Dividend AwardUnits previously credited to the Award Recipient under this Agreement as ofsuch current 

 

 

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dividend payment date (but prior to the crediting of current Dividend AwardUnits), by (2) the Fair Market Value (as defined in the Omnibus Stock Plan) ofone share of Common Stock as of such current dividend payment date.  Dividend Award Units may be credited in wholeor fractional units as applicable.  TheDividend Award Units so credited shall be subject to the same terms andconditions as the Award Units to which they relate.

 

**6.         DISTRIBUTION OF SHARES:**

 

**               **Upon the AwardRecipient’s separation from service (within the meaning of Section 409A of the InternalRevenue Code of 1986, as amended (“Code”) with the Company and all affiliates,all vested Award Units shall be converted into an equivalent number of sharesof Common Stock which shall be distributed to the Award Recipient (or to hisdesignated beneficiary or legal representative, as applicable, in the event ofhis death) as soon as practicable; provided, however, that any fractional AwardUnit shall be distributed to the Award Recipient in cash.  Notwithstanding the foregoing, however, ifthe Award Recipient is a “specified employee” within the meaning of Section409A of the Code, distribution shall be not be made to him until six monthsafter his separation from Service with the Company and all affiliates.  Distribution shall be evidenced by theissuance of a stock certificate and the entry of the Award Recipient’s name (orin the name of his designated beneficiary or legal representative, asapplicable, in the event of his death) as a stockholder of record on the booksof the Company with respect to such distributed shares of Common Stock.  Upon receipt of such stock certificate, the holder shallbe free to hold or dispose of such certificate at will, subject to anyapplicable securities laws or regulations governing transferability of sharesof the Company.

 

**7.             WITHHOLDINGTAXES**

 

                The Company andany affiliate shall have the right to deduct from any compensation or any otherpayment of any kind (including withholding the issuance of shares of CommonStock) due the Award Recipient the amount of any federal, state or local taxesrequired by law to be withheld as a result of the distribution of Common Stockhereunder; provided, however, that the value of the shares of Common Stockwithheld may not exceed the statutory minimum withholding amount required bylaw.  In lieu of such deduction, theCompany may require the Award Recipient to make a cash payment to the Companyor an affiliate equal to the amount required to be withheld.  If the Award Recipient does not make suchpayment when requested, the Company may refuse to issue any Common Stockcertificate under this Agreement until arrangements satisfactory to theCommittee for such payment have been made.

 

**8.             IMPACTON OTHER BENEFITS:**

 

                The value of theCommon Stock issued hereunder shall not be includable as compensation orearnings for purposes of any other benefit plan offered by the Company unlessspecifically provided in such plan.

 

**9.             ADMINISTRATION:**

 

 

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                The Committee orthe Board shall have full authority and discretion (subject only to the expressprovisions of the Omnibus Stock Plan) to decide all matters relating to theadministration, interpretation and implementation of the Omnibus Stock Plan andthis Agreement.  Subject to Section 10hereof, all such Committee determinations shall be final, conclusive, and bindingupon the Company, the Award Recipient, and any and all interested parties.

 

**10.          CLAIMPROCEDURE:**

 

                (a)           If any claim for compensation iswholly or partially denied, the Committee shall, within 90 days after receiptof a written claim, notify the Award Recipient of such denial (unless theAdministrator determines that special circumstances require an extension oftime for processing the claim).  Suchnotice of denial shall be in writing and shall contain (1) the specific reasonor reasons for denial of the claim, (2) reference to the specific provisions ofthis Agreement and/or the Omnibus Stock Plan upon which the denial is based,(3) a description of any additional material or information necessary toperfect the claim and an explanation of why such material or information isnecessary, and (4) an explanation of the claim review procedure, as specifiedunder the provisions of this Section 10.

 

                (b)           In the event that a claim forcompensation by the Award Recipient is denied, the Award Recipient may (1) filewith the Committee a written request that the Committee conduct a full and fairreview of the denial of the claim for compensation, and (2) review anydocuments pertinent to such request. Such request shall be delivered to the Committee within 60 days afterthe receipt by the Award Recipient of the written notice of denial of theclaim.  Such review shall (i) provide theAward Recipient with the opportunity to submit written comments, documents,records and other information relating to the claim for compensation, (ii)provide the Award Recipient, upon request and free of charge, reasonable accessto, and copies of, all documents, records and other information relevant to theclaim for compensation, and (iii) take into account all comments, documents,records or other information submitted by the Award Recipient relating to theclaim for compensation, without regard to whether such information wassubmitted or considered in the initial determination of compensation.

 

                (c)           The Committee shall deliver to theAward Recipient a written decision on any claim filed hereunder within 60 daysafter the receipt of the aforesaid request for review (unless the Committeedetermines that special circumstances require an extension of time forprocessing the claim).  Such decisionshall (1) include specific reasons for the decision, (2) contain specificreferences to the pertinent provisions of this Agreement and/or the OmnibusStock Plan upon which the decision is based, (3) contain a statement that theAward Recipient is entitled to receive, upon request and free of charge,reasonable access to, and copies of, all documents, records and otherinformation relevant to the Award Recipient’s claim for compensation,  and (4) contain a statement describing therights of the Award Recipient to bring suit under the Employee RetirementIncome Security Act of 1974, as amended.

 

 

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                (d)           Notwithstanding the foregoing, theBoard may determine to act in the Committee’s place under this Section 10.

 

**11.          RIGHTTO CONTINUED EMPLOYMENT:**

 

                Nothing in theOmnibus Stock Plan or this Agreement shall be construed as a contract ofemployment between the Company or any affiliate and the Award Recipient, or asa contractual right of the Award Recipient to continue in the employ of theCompany or any affiliate.

 

**12.          UNFUNDEDOBLIGATION:**

 

                The obligationof the Company to make payments with respect to Award Units granted hereundershall be interpreted solely as an unfunded contractual obligation to make suchpayments in the manner and under the conditions prescribed under thisAgreement.  Assets, if any, set asidewith respect to amounts payable under this Agreement shall be subject to theclaims of the Company’s general creditors, and no person other than the Companyshall, by virtue of the provisions of the Omnibus Plan or this Agreement, haveany interest in such assets.  Neither theAward Recipient nor any other person shall have any interest in any particularassets of the Company by reason of the right to receive a benefit under thisAgreement, and the Award Recipient or any such other person shall have only therights of a general unsecured creditor of the Company with respectto any rightsunder the Omnibus Plan or this Agreement.

 

**13.*         *AMENDMENTS:**

 

                This Agreementcontains the entire agreement between the parties with respect to the subjectmatter contained herein and may not be modified, except as provided in theOmnibus Stock Plan or in a written document signed by each of the partieshereto.

 

**14.          FORCEAND EFFECT:**

 

                This Agreement isintended to conform in all respects with, and is subject to all applicableprovisions of, the Omnibus Stock Plan (including, without limitation, theantidilution and other provisions of Article 7), which is incorporated hereinby reference.  Inconsistencies betweenthe Agreement and the Omnibus Stock Plan shall be resolved in accordance withthe terms of the Omnibus Stock Plan.  Inthe event of any ambiguity in the Agreement or any matters as to which theAgreement is silent, the Omnibus Stock Plan shall govern.

 

**15.          PREVAILINGLAWS:**

 

                Except to theextent preempted by federal law, this Agreement shall be construed and enforcedin accordance with and governed by the laws of the State of Maryland, withoutregard to the conflict of laws principles thereof.

 

 

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**16.          SUCCESSORS:**

 

*               *This Agreement shall be binding upon andinure to the benefit of the Company, its successors and assigns, and the AwardRecipient and his heirs, personal representatives and assigns.

 

**17.          COMPLIANCEWITH SECTION 409A:**

 

**               **Anything contained herein to the contrarynotwithstanding, it is intended that this Agreement comply in all respects withSection 409A of the Code, and this Agreement shall be interpreted andadministered in such manner as to comply with such provisions.  This Agreement may be amended, retroactivelyif necessary, to conform this Agreement to the requirements of Section 409A ofthe Code.

 

                **IN WITNESS WHEREOF**, the Company has caused this Agreement tobe executed by its duly authorized officer, and the Award Recipient hashereunto set his hand and seal, as of the 29th day of March, 2006.

 

 
| **ATTEST**:              |       | Mercantile Bankshares Corporation |
|--------------------------|------------|-----------------------------------|
|                     |       |                              |
| ** **               | ** ** | **By**:                           |   |
| John L. Unger, Secretary |       |                              |
|                     |       |                              |
| **WITNESS**:             |       |                              |
|                     |       |                              |
|                     |       |                              |   |
|                     |       | Edward J. Kelly, III.             |
|                          |            |                                   |  |  |

 

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