Document:

Exhibit 10.1

 

Exhibit 10.1

AMENDED EMPLOYMENT AGREEMENT

     THIS AMENDED EMPLOYMENT AGREEMENT (this ”Agreement”) is made at Cleveland, Ohio, as of
February 15, 2005, between KEYCORP, an Ohio corporation (“Key”), and HENRY L. MEYER III (“Meyer”).
The original version of this Agreement was entered into by Key and Meyer as of May 15, 1997, and
was amended as of each of November 20, 1997, July 21, 1999, February 1, 2001, and July 18, 2002.
Further amendments are incorporated below in this Agreement which replaces and supersedes both the
original version and those prior amendments.

     Meyer has been elected as Chairman of the Board of Directors, President, and Chief Executive
Officer of Key. Key is entering into this Agreement in recognition of the importance of Meyer’s
services to the continuity of management of Key and based upon its determination that it will be in
the best interests of Key and its Subsidiaries to encourage Meyer’s continued attention and
dedication to his duties on behalf of Key on into the future. (As used in this Agreement, the term
“Subsidiaries” and certain other capitalized terms have the meanings ascribed to them in Section
25, at the end of this Agreement.)

     Key and Meyer agree, effective as of the date first set forth above (the “Effective Date”), as
follows:

1. Employment, Term. Key engages and employs Meyer to render such services in the administration
and operation of its affairs as, from time to time, may be specified by its Board of Directors in a
manner consistent with his status as Chairman of the Board of Directors, President, and Chief
Executive Officer, all in accordance with the terms and conditions of this Agreement, for a
constantly renewing three year term, commencing on the Effective Date, so that the remaining term
of employment under this Agreement shall always be three years, unless: (a) either party gives
written notice to the other that the term shall no longer constantly renew (in which case, the term
of employment under this Agreement will expire on the third anniversary of the giving of such
notice) or (b) Meyer’s employment under this Agreement is earlier terminated in accordance with the
provisions of one of Sections 6.2 through 6.7 of this Agreement.
Thus, for example, on February 16,
2005, the term of employment under this Agreement will be for three
years until February 16, 2008;
automatically, without any action by either party, the term will
renew and extend itself on February 17, 2005 so as to be a three year
term of employment until February 17, 2008; and so on with the
term automatically extending on a daily basis so as always to be a three year term until either
notice is given under clause (a) above or Meyer’s employment is earlier terminated in accordance
with the provisions of one of Sections 6.2 through 6.7 of this Agreement.

2. Full-Time Services. Meyer will devote all his time and efforts to the service of Key, except
for (a) usual vacation periods and reasonable periods of illness, (b) services as an officer and
director of any Subsidiary of Key, and (c) services as a director or trustee of other corporations
or organizations that are not in competition with Key or any Subsidiary, except that,

 

 

Meyer shall obtain the prior approval of the Chairman of the Compensation Committee of Key’s Board
of Directors before accepting a position as director or trustee of any for profit entity, other
than Continental Airlines, Inc. (whether the entity is in corporate or other form).

3. Executive Officer. Except as provided in the last sentence of this Section 3, Meyer shall hold
the offices of Chairman of the Board of Directors, President, and Chief Executive Officer of Key
throughout the period of his employment under this Agreement. Meyer and Key may, at some point in
time after the Effective Date, mutually agree that a different executive officer of Key should hold
the title of President and report to Meyer while Meyer remains as Chairman of the Board of
Directors and Chief Executive Officer of Key.

4. Compensation. For all services to be rendered by Meyer to Key under this Agreement, including
services as an officer, director, Chairman of the Board of Directors, or member of any committee of
Key or of any Subsidiary, or any other services specified by the Board of Directors, Key shall pay
to Meyer, in equal monthly or more frequent installments, Base Salary at a rate of not less than
$950,000 per annum. The rate of Meyer’s Base Salary shall be subject to increase from time to time
at the discretion of the Compensation Committee of the Board of Directors and shall not be subject
to decrease except and then only to the extent that there is an across-the-board salary reduction
applicable to the executive officers of Key generally. In addition to being paid such Base Salary,
Meyer shall participate fully in any incentive compensation, retirement, savings, stock option,
restricted stock, disability, and other employee benefit and welfare plan or arrangement allowed or
provided by Key in which he would otherwise be eligible for participation as an executive officer
and employee of Key, and, to the extent not provided, Key shall pay or provide for the payment of
benefits commensurate with Meyer’s annual compensation.

5. Certain Compensation Guaranties During Two Years following a Change of Control. For so long as
Meyer remains in the employ of the Surviving Entity or one of its Subsidiaries during the period
beginning on the day after any Change of Control and continuing through the second anniversary of
that Change of Control (the period of Meyer’s employment during that two year period being the
“Guaranteed Compensation Period”), Meyer shall be entitled to the Incentive Compensation Guaranty
set forth in Section 5.1 and to the Option/SAR Guaranty set forth in Section 5.2. For purposes of
determining Meyer’s entitlement to benefits under the Supplemental Retirement Plan, amounts
received by Meyer in satisfaction of the Incentive Compensation Guaranty set forth in Section 5.1,
to the extent allocable to long term incentive compensation that was taken into account in
determining Average Annual Incentive Compensation, shall be deemed to be long term incentive
compensation received by Meyer during the Guaranteed Compensation Period.

5.1 Guaranteed Level of Incentive Compensation. Except as otherwise provided in Section 5.3,
the Surviving Entity shall cause Meyer to receive, during the Guaranteed Compensation Period, as
incentive compensation, an amount that, on an annualized basis, is at least equal to Meyer’s
Average Annual Incentive Compensation. The guaranty set forth in the immediately preceding
sentence (the “Incentive Compensation Guaranty”) establishes a minimum amount of incentive
compensation that must be paid to Meyer with respect to

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Meyer’s employment during the Guaranteed Compensation Period. Except as and to the extent
otherwise permitted by any of the provisions of Section 5.3:

(a) The Surviving Entity shall make payments to Meyer in cash that satisfy the
Incentive Compensation Guaranty quarterly in arrears, within 30 days after the end of
each calendar quarter for each quarter or portion thereof during the Guaranteed
Compensation Period;

(b) If Meyer’s employment is terminated for any reason other than Cause, all unpaid
guaranteed incentive compensation with respect to the Guaranteed Compensation Period
shall be paid to Meyer by the Surviving Entity in a lump sum within 30 business days
following the Termination Date; and

(c) If Meyer’s employment is terminated by the Surviving Entity for Cause, the
Surviving Entity shall not be required to pay to Meyer any amount of incentive
compensation otherwise payable at any time on or after the Termination Date.

5.2 Guaranteed Participation in Stock Option and SAR Plans. During the Guaranteed Compensation
Period, Meyer shall participate fully (at a level that is at least comparable to the level at
which he participated in the last calendar year that ended before the date of the Change of
Control and is at least equal to the highest targeted level at which other executive officers of
the Surviving Entity participate) in each and every stock option and stock appreciation right
plan in which executive officers of the Surviving Entity generally participate. The guaranty of
full participation set forth in this Section 5.2 is hereinafter sometimes referred to as the
“Option/SAR Guaranty.”

5.3 Exceptions to and Alternative Means of Satisfying the Incentive Compensation Guaranty. For
purposes of the exceptions and alternative means of satisfying the Incentive Compensation
Guaranty that are set forth in this Section 5.3, the Incentive Compensation Guaranty shall be
deemed to be made up of two parts, the “Short Term Part” and the “Long Term Part,” each of which
shall bear the same proportion, respectively, to the entire Incentive Compensation Guaranty as
Average Short Term Incentive Compensation and Average Long Term Incentive Compensation bear,
respectively, to Average Annual Incentive Compensation.

(a) Bona fide Short Term Incentive Compensation Plan Exception. If (i) the Surviving
Entity maintains a bona fide short term incentive compensation plan that (x) would
satisfy the Short Term Part if Meyer received short term incentive compensation under
that plan at Meyer’s target level (as the target level is specified under that plan) and
(y) specifies a target level for Meyer that is the highest target level for any
executive employed by the Surviving Entity; (ii) the Surviving Entity, in administering
that plan in good faith and without discriminating against Meyer, utilizes a performance
factor that is intended to rate the corporation’s overall performance for the short term
compensation cycle in question; (iii) that performance factor is uniformly applied
(either in establishing an incentive compensation pool or

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against each participant’s target) to all participants in the plan; and (iv) the
application of that factor reduces the short term incentive compensation payable under
that plan to a level below Meyer’s target level; then payment of the short term
incentive compensation, if any, due to Meyer at the reduced level under that plan shall
satisfy the Surviving Entity’s obligation under the Short Term Part for that particular
short term compensation cycle.

(b) Annual Payment Exception. If the Surviving Entity maintains a bona fide short term
incentive compensation plan that would satisfy the Short Term Part if Meyer received
short term incentive compensation under that plan at Meyer’s target level and that plan
provides for payment of all amounts earned at regularly scheduled times not less
frequently than once a year, the Surviving Entity may satisfy the Short Term Part by
paying incentive compensation to Meyer under that plan (at not less than Meyer’s target
level or as reduced if permitted by 5.3(a) above) at those regularly scheduled times,
except that if Meyer’s employment terminates for any reason other than Cause, the
Surviving Entity shall make payments under that plan, pro rated to include all periods
within the Compensation Guaranty Period as to which Meyer has not yet received incentive
compensation under that plan, within 30 business days after the Termination Date.

(c) Issuance of Restricted Stock Alternative. As an alternative to paying Meyer cash
to satisfy the Long Term Part, the Surviving Entity may make restricted stock grants of
Common Shares to Meyer each year during the Guaranteed Compensation Period that:

(i) are made during the same calendar quarter of the year as the calendar quarter during which
Key made LTIC Stock Grants to Meyer in the last calendar year that ended before the beginning
of the Guaranteed Compensation Period;

(ii) have a Fair Market Value that on an annual basis is at least equal to Meyer’s Average Long
Term Incentive Compensation;

(iii) provide for time lapsed vesting of the restricted stock subject to the grant so that the
entire grant will be fully vested not later than the third anniversary of the date of grant if
Meyer continues to be employed through that date; and

(iv) have the further provision that, upon any termination of Meyer’s employment other than a
termination for Cause (including, without limitation, any termination by reason of death,
disability, voluntary or involuntary retirement, or resignation), if, as of the Termination
Date, less than a proportionate part of the Common Shares subject to the restricted stock grant
granted to Meyer during the Guaranteed Compensation Period has vested, then an additional
portion of those Common Shares shall vest immediately on the Termination Date so that, in the
aggregate, a proportionate part has vested as of the Termination Date. For these purposes, “a
proportionate part” means the full number of Common Shares in the restricted stock grant
multiplied by a fraction, the numerator of which is the number of days between (x) January 1

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of the calendar year in which the restricted stock grant was made and (y) the last day of the
Guaranteed Compensation Period, inclusive, and the denominator of which is 1095 (i.e., 365 times
three).

If the Surviving Entity makes restricted stock grants as provided in this 5.3(c), the Surviving
Entity will have satisfied the Long Term Part.

6. Termination.

6.1 Three Years following Notice of Non-Renewal. If either party gives written notice to the
other of his or its intention to discontinue the otherwise automatic renewal of the term of
Meyer’s employment hereunder (a “Non-Renewal Notice”), that term will terminate on the third
anniversary of the giving of the Non-Renewal Notice, except that if a Change of Control occurs
before that third anniversary date and while Meyer remains employed by Key pursuant to this
Agreement, the Non-Renewal Notice shall be automatically abrogated and thereafter treated as
though it had never been given unless Meyer gives written notice, not later than 30 days after
the occurrence of the Change of Control, that he desires to have the Non-Renewal Notice (whether
it was given by Key or by Meyer) continue in effect. If either party gives the other a
Non-Renewal Notice as provided in the immediately preceding sentence, that Non-Renewal Notice
remains in effect through the third anniversary of the giving of that notice, and Meyer’s
employment continues through that third anniversary, Meyer’s employment under this Agreement
shall terminate at 12:00 Midnight on that third anniversary.

6.2 Death or Disability. Meyer’s employment hereunder will terminate immediately upon Meyer’s
death. Key may terminate Meyer’s employment hereunder immediately upon giving notice of
termination if Meyer is disabled, by reason of physical or mental impairment, to such an extent
that he is unable to substantially perform his duties under this Agreement for 180 consecutive
days.

6.3 For “Cause” Absent a Change of Control. At any time that is either before the occurrence of
any Change of Control or after the second anniversary of the then most recent Change of Control,
Key may terminate Meyer’s employment hereunder for “Cause” if:

(a) Meyer commits a felony (other than felonious operation of a motor vehicle);

(b) Meyer commits an act or series of acts of dishonesty in the course of his
employment that are materially inimical to the best interests of Key or a Subsidiary as
determined by Majority Action of the Board of Directors and, if the act or acts are
capable of being cured, Meyer fails to cure or take all reasonable steps to cure within
30 days of notice from the Board of Directors to Meyer;

(c) Key or any Subsidiary has been ordered or directed by any federal or state
regulatory agency with jurisdiction to terminate or suspend Meyer’s employment and such
order or directive has not been vacated or reversed upon appeal;

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(d) Meyer continues to violate his obligation under Section 10.1 not to engage in
Competitive Activities for more than ten days after the Board of Directors has by
Majority Action advised him in writing to cease those activities; or

(e) Other than for disability, Meyer abandons and consistently fails to attempt to
perform his duties and responsibilities as specified from time to time by the Board of
Directors for 90 consecutive days after the Board of Directors has by Majority Action
advised him in writing of that failure.

6.4 For “Cause” Within Two Years After a Change of Control. From the date on which occurs any
Change of Control and thereafter through the second anniversary of that Change of Control, the
Surviving Entity and its Subsidiaries may terminate Meyer’s employment under this Agreement for
“Cause” only if :

(a) Meyer is convicted of a felony (other than felonious operation of a motor vehicle);

(b) Meyer commits an act or series of acts of dishonesty in the course of his
employment that are materially inimical to the best interests of the Surviving Entity or
any of its Subsidiaries and that constitutes the commission of a felony (other than
felonious operation of a motor vehicle), all as determined in good faith by the vote of
three quarters of the entire number of members of the Board of Directors, which
determination is confirmed by a panel of three arbitrators appointed and acting in
accordance with the rules of the American Arbitration Association for the purpose of
reviewing that determination;

(c) The Surviving Entity or any of its Subsidiaries has been ordered or directed by any
federal or state regulatory agency with jurisdiction to terminate or suspend Meyer’s
employment and, notwithstanding the best efforts of the Surviving Entity and/or its
relevant Subsidiary or Subsidiaries to oppose, initially, and to appeal, thereafter, the
order or directive, that order or directive has not been vacated or reversed upon
appeal; or

(d) Meyer continues to violate his obligation under Section 10.1 not to engage in
Competitive Activities for more than ten days after the Board of Directors has by
Majority Action advised him in writing to cease those activities, that violation is
material, and the fact that the violation both was material and so continued beyond that
ten day period is confirmed by a panel of three arbitrators appointed and acting in
accordance with the rules of the American Arbitration Association for the purpose of
determining whether the violation both was material and so continued beyond that ten day
period.

If (x) the Surviving Entity or any of its Subsidiaries terminates the employment of Meyer during
the two year period beginning on the date of a Change of Control and at a time when it has
“Cause” therefor under clause (c) above, (y) the order or directive is subsequently vacated or
reversed on appeal and the vacation or reversal becomes final and no longer subject to

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further appeal, and (z) the Surviving Entity or any of its Subsidiaries fails to offer to
reinstate Meyer to employment under this Agreement within ten days of the date on which the
vacation or reversal becomes final and no longer subject to further appeal, the Surviving Entity
and its Subsidiaries will be deemed to have terminated Meyer without Cause during the two year
period beginning on the date of the Change of Control.

6.5 By Key Without Cause. Key may terminate Meyer’s employment hereunder without Cause at any
time by Majority Action of the Board of Directors.

6.6 By Meyer Following Constructive Termination at Any Time. Meyer may terminate his employment
hereunder “on grounds of Constructive Termination” (and, if Meyer elects to terminate his
employment in such circumstances, he will be deemed to have been “Constructively Terminated” and
not to have “Voluntarily Resigned” or “Voluntarily Retired”) if, at any time:

(a) Meyer’s Base Salary is reduced other than in connection with, and then only to the
extent of, a general across-the-board salary reduction applicable to the executive
officers of Key generally;

(b) Meyer is excluded from full participation in any incentive, option, restricted
stock, or other compensatory plan applicable to executive officers of Key generally;

(c) Meyer is subject to Demotion or Removal;

(d) Key requests Meyer’s resignation or retirement at a time when Key does not have
grounds to terminate Meyer’s employment for Cause; or

(e) Meyer’s principal place of employment for Key is relocated outside of the Cleveland
metropolitan area or Meyer is otherwise required by Key to relocate outside the
Cleveland metropolitan area.

6.7 By Meyer Following Constructive Termination Within Two Years After a Change of Control. At
any time during the period beginning on the date on which occurs any Change of Control and
thereafter through the second anniversary of that Change of Control, Meyer may terminate his
employment hereunder “on grounds of Constructive Termination” (and, if Meyer elects to terminate
his employment in such circumstances, he will be deemed to have been “Constructively Terminated”
and not to have “Voluntarily Resigned” or “Voluntarily Retired”) if he could then terminate his
employment on any of the grounds of Constructive Termination listed under Section 6.6 or if:

(a) Meyer’s Base Salary is reduced from the highest level in effect at any time during
the one year period ending on the date of the Change of Control;

(b) Meyer is excluded from full participation in any incentive, option, restricted
stock, or other compensatory plan that was available to him and in effect at any time

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during the one year period ending on the date of the Change of Control (the “Pre-Change
of Control Compensatory Plans”) unless Meyer is provided with substitute incentive,
option, restricted stock, and other compensatory plans that provide to Meyer, in the
aggregate, at least substantially equivalent compensatory opportunities as would have
been provided had the Pre-Change of Control Compensatory Plans remained in effect with
Meyer as a full participant therein;

(c) Following notice by Meyer to the Surviving Entity and an opportunity by the
Surviving Entity to cure, the Surviving Entity fails to satisfy the Incentive
Compensation Guaranty or the Option/SAR Guaranty or Meyer is otherwise excluded from
full participation in any incentive, option, restricted stock, or other compensation
plan that is generally applicable to executive officers of the Surviving Entity after
the Change of Control;

(d) The headquarters of the Surviving Entity is located outside of the Cleveland
metropolitan area;

(e) Meyer determines in good faith that his responsibilities, duties, or authorities
with the Surviving Entity are materially reduced from those in effect before the Change
of Control and the reduction has not been cured within thirty days after Meyer gives
notice to the Board of Directors of the Surviving Entity of his election to terminate
his employment based upon that reduction; or

(f) Meyer determines in good faith that as a result of the Change of Control he is
unable to carry out the authorities, powers, functions, responsibilities, or duties as
Chairman of the Board of Directors and Chief Executive Officer as those authorities,
powers, functions, responsibilities, or duties attached to those positions were in
effect before the Change of Control and the Board of Directors of the Surviving Entity
fails to fully address those issues (as determined by Meyer in good faith) within thirty
days after Meyer gives notice to the Board of Directors of his determination under this
clause (f) and the basis of such determination.

For purposes of clause (c), the Surviving Entity will be deemed to have had an opportunity to
cure and to have failed to effect a cure if the failure to satisfy the Incentive Compensation
Guaranty or the Option/SAR Guaranty, as the case may be, persists (as determined in good faith
by Meyer) for more than thirty calendar days after Meyer has given notice to the Surviving
Entity of the existence of that failure.

7. Severance Payments and Benefits upon Termination.

7.1 Termination by Key Without Cause, etc., or by Meyer Following Constructive Termination. If
Meyer’s employment is terminated by Key (or, if applicable, the Surviving Entity) for any reason
other than Cause, disability, or death, or if Meyer is Constructively Terminated:

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(a) Base Salary through Termination Date. Key shall pay to Meyer, at the same time or
times as would have been the case absent the termination, any unpaid Base Salary due or
to become due to Meyer with respect to any period ending on or before the Termination
Date.

(b) Short Term Incentive Compensation through Termination Date. Key shall pay to
Meyer, within 30 days after the Termination Date, as short term incentive compensation
with respect to each short term incentive compensation plan in which Meyer is a
participant, an amount equal to a pro rata portion of Meyer’s targeted short term
incentive compensation under that plan for the calendar year in which the Termination
Date falls. For these purposes, a “pro rata portion” means the percentage figure
determined by dividing the number of days between January 1 of the calendar year in
question through the Termination Date, inclusive, by 365. Any amount paid by Key to
Meyer pursuant to this Section 7.1(b) with respect to a particular short term incentive
compensation plan in which Meyer is a participant shall reduce, but not below zero, the
amount that Key is required to pay to Meyer under that plan as short term incentive
compensation for the calendar year in which the Termination Date falls, but that short
term incentive compensation plan shall in all other respects be governed by its terms.

(c) Lump Sum Payment. Key shall pay to Meyer, within 30 days after the Termination
Date, a lump sum severance benefit equal to three times the sum of (i) one year’s Base
Salary (at the highest rate in effect at any time before the Termination Date) plus (ii)
his Average Annual Incentive Compensation;

(d) Retirement and Savings Plan Participation. For the period beginning on the day
after the Termination Date and ending on the third anniversary of the Termination Date
(the “Continuing Benefit Period”), Key shall cause Meyer to continue to be covered by
and to participate in all Retirement Plans and Savings Plans that he was entitled to be
covered by and participating in as an officer of Key immediately before the Termination
Date in the same manner and to the same extent as if Meyer continued in the full-time
employ of Key throughout the Continuing Benefit Period, except where such coverage or
participation is Impermissible. For these purposes: (i) the entire Continuing Benefit
Period shall be included in determining Meyer’s years of service, (ii) amounts received
by Meyer under clause (c)(i) above shall be deemed to be base salary received by Meyer
ratably during the Continuing Benefit Period, and (iii) amounts received by Meyer under
clause (c)(ii) above shall be deemed to be incentive compensation received by Meyer
ratably during the Continuing Benefit Period and shall, if relevant, be allocated
between short term incentive compensation and long term incentive compensation based on
the degree to which awards of each type of incentive compensation were taken into
account in determining Average Annual Incentive Compensation. If, at any time during
the Continuing Benefit Period, Key determines in good faith that continuing Meyer’s
coverage by and participation in any of the Retirement Plans or any of the Savings Plans
during the Continuing Benefit Period is Impermissible, Meyer shall not be covered by and

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participate in such affected plan or plans during the Continuing Benefit Period, but Key
shall provide to Meyer under this Agreement, as a supplemental retirement benefit,
payments and benefits that put Meyer in the same position that he would have been in had
he continued to be covered by and participated in all such affected plan or plans
throughout the Continuing Benefit Period to the same extent as he was a participant
immediately before the Termination Date, with the supplemental payments and benefits
under this sentence being payable to Meyer (or, if applicable, to his wife, estate, or
designated beneficiary) at the same time and with the same payment options as would be
applicable under the affected plan or plans in question.

(e) Medical, Disability, and Group Term Life Coverage. Through the third anniversary
of the Termination Date, Key shall continue to maintain in effect medical (including
dental) coverage, disability coverage, and group term life insurance for the benefit of
Meyer and his dependents at the same levels and subject to the same (by dollar amount)
employee contribution requirement, if any, as had been in effect for the benefit of
Meyer and his dependents before the Termination Date. After the third anniversary of
the Termination Date, Meyer and his dependents shall be provided retiree medical
benefits that are at least equal to those that Meyer and his dependents would have been
entitled to under the Retiree Medical Benefits Plan if Meyer had retired from Key on the
Termination Date after satisfying all eligibility requirements for retiree medical
benefits under that plan. The retiree medical benefits shall be provided under the
Retiree Medical Benefit Plan, with the cost thereof borne as between Key and Meyer and
his dependents as provided in that plan, if and so long as that plan remains in effect
and Meyer and his dependents are in fact eligible for the intended benefits thereunder.
In all other circumstances, the retiree medical benefits shall be provided directly by
Key, with the cost thereof borne as between Key and Meyer and his dependents in the same
manner as would have been the case if the benefits had been provided under the Retiree
Medical Benefits Plan rather than directly by Key.

7.2 Effect of Death While in Employ of Key. If Meyer dies while employed by Key:

(a) Key shall pay to Meyer’s estate any unpaid Base Salary due or to become due to
Meyer with respect to any period ending before his death and Key shall have no further
obligations to Meyer for Base Salary for any period after Meyer’s death.

(b) Key shall continue to maintain medical (including dental) coverage in effect (i)
for the benefit of Meyer’s wife, for her lifetime, and (ii) for the benefit of each of
Meyer’s children, through the earlier of the date on which he or she attains age 23 or
has ceased for more than 120 consecutive days to be a full time student, in each case at
Key’s sole cost and at the highest levels as had been in effect for the benefit of
Meyer’s wife and each of his children, as the case may be, at any time before the
Termination Date.

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(c) Upon his death, Meyer’s rights under any other plan or benefit of Key shall be
governed by the respective terms thereof.

7.3 Effect of Disability While in Employ of Key. If, while Meyer is employed by Key, he becomes
disabled, by reason of physical or mental impairment, to such an extent that he is unable to
perform his duties under this Agreement:

(a) Key may relieve Meyer of his duties under this Agreement for as long as Meyer is so
disabled.

(b) Key shall pay to Meyer all Base Salary and incentive compensation to which he would
have been entitled under this Agreement and under applicable incentive compensation
plans had he continued to be actively employed by Key to the earliest of (i) the date on
which he becomes eligible for payment of long term disability benefits under the Long
Term Disability Benefit Plan, (ii) the date of his death, or (iii) the third anniversary
of the first date on which his employment hereunder could have been terminated by Key
pursuant to the second sentence of Section 6.2, except that if, after Meyer has become
so disabled and before he is terminated by Key pursuant to the second sentence of
Section 6.2, Meyer recovers so that he is no longer so disabled to such an extent that
he is unable to perform his duties under this Agreement, Meyer shall be restored to his
duties under this Agreement and entitled to the benefits of and subject to this
Agreement as if no period of disability had occurred.

(c) The amounts payable to Meyer for any month under this Section 7.3 shall be reduced,
but not below zero, by the full amount of the payments, if any, received by Meyer for
that month (i) from all Retirement Plans, (ii) from the Long Term Disability Plan, and
(iii) from any other disability plan the entire cost of which is borne by Key.

(d) For purposes of all incentive compensation, retirement, savings, stock option,
restricted stock, disability, and other employee benefit and welfare plans or
arrangements allowed or provided by Key to executive officers, Meyer shall be treated in
the same manner that Key treats other executive officers who become disabled.

(e) Except as provided in this Section 7.3, Key shall have no further obligations to
Meyer for Base Salary or incentive compensation for any period during which Meyer is so
disabled to such an extent that he is unable to perform his duties under this Agreement.

(f) The payments provided for under this Section 7.3 shall be made as provided for in
this Section notwithstanding any termination of Meyer’s employment under the second
sentence of Section 6.2.

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7.4 Effect of Termination for Cause. If Meyer’s employment is terminated for Cause, Key may, by
giving written notice to Meyer, terminate all its obligations remaining to be performed or
observed by it under this Agreement (other than the obligation to pay Base Salary to Meyer
through the Termination Date and the obligations of Key under
Sections 11 and 12.3), except no
termination of Key’s obligations under this Agreement shall affect Meyer’s rights under any plan
or benefit of Key, all of which shall be governed by their respective terms.

7.5 Effect of Termination Upon Meyer’s Voluntary Resignation or Voluntary Retirement. If
Meyer’s employment is terminated by Meyer’s Voluntary Resignation or Voluntary Retirement, Key
may, by giving written notice to Meyer, terminate all its obligations remaining to be performed
or observed by it under this Agreement (other than the obligation to pay Base Salary to Meyer
through the Termination Date, the obligations of Key under
Sections 11 and 12 and, to the extent
then applicable by their respective terms, the obligations of Key under Sections 14, 15, and
16), except no termination of Key’s obligations under this Agreement shall affect Meyer’s rights
under any plan or benefit of Key, all of which shall be governed by their respective terms.

8. No Set-Off; No Obligation to Seek Other Employment or to Otherwise Mitigate Damages; No Effect
Upon Other Plans. Key’s obligation to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense, or other claim whatsoever that Key or any of its Subsidiaries may have against
Meyer, except that the prohibition on set-off, counterclaim, recoupment, defense, or other claim
contained in this sentence shall not apply if Meyer’s employment is terminated by Key for Cause at
any time that is either before the occurrence of any Change of Control or after the second
anniversary of the then most recent Change of Control. Meyer shall not be required to mitigate
damages or the amount of any payment provided for under this Agreement by seeking other employment
or otherwise. The amount of any payment provided for under this Agreement shall not be reduced by
any compensation or benefits earned by Meyer as the result of employment by another employer or
otherwise after the termination of Meyer’s employment. Neither the provisions of this Agreement
nor the making of any payment provided for hereunder, nor the termination of Key’s obligations
under this Agreement, shall reduce any amounts otherwise payable, or in any way diminish Meyer’s
rights, under any incentive compensation plan, stock option or stock appreciation rights plan,
restricted stock plan or agreement, deferred compensation, retirement, or supplemental retirement
plan, stock purchase and savings plan, disability or insurance plan, or other similar contract,
plan, or arrangement of Key or any Subsidiary, all of which shall be governed by their respective
terms.

9. Payments Are in Lieu of Severance Payments. If Meyer becomes entitled to receive payments under
this Agreement as a result of termination of his employment, those payments shall be in lieu of any
and all other claims or rights that Meyer may have against Key for severance, separation, and/or
salary continuation pay upon that termination of his employment.

10. Limitations on Competition.

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10.1 During Employment. Meyer shall not engage in any Competitive Activity during the period of
his employment with Key.

10.2 Two Years in Certain Circumstances. If Meyer’s employment is terminated within two years
after the occurrence of a Change of Control either by Key without Cause or by Meyer after he has
been Constructively Terminated, Meyer shall not engage in any Competitive Activity during the
two year period ending on the second anniversary of the Termination Date.

10.3 Three Years Following Any Other Termination. If Meyer’s employment is terminated (whether
by him, by Key, or otherwise) in any circumstances other than those expressly covered by Section
10.2 above, Meyer shall not engage in any Competitive Activity at any time during the three year
period ending on the third anniversary of the Termination Date.

10.4 No Further Obligation to Make Payments or Provide Benefits Following Continuing Breach. If
Meyer continues to violate the restriction set forth in Section 10.2 or 10.3, as may be
applicable, after the Board of Directors has advised him by Majority Action in writing to cease
those activities and that violation is material, Key shall thereupon be relieved of all further
obligations to make payments and provide benefits to Meyer under any of the provisions contained
in Section 7.1. Meyer shall not be required to repay to Key any payment received by him before
he began to engage in any such Competitive Activity.

10.5 Other Remedies. In addition to other remedies provided by law or equity, upon a breach by
Meyer of any prohibition on Competitive Activity contained in this Section 10, Key shall be
entitled to have a court of competent jurisdiction enter an injunction against Meyer restraining
him from any further breach of any such prohibition.

11. Indemnification. Key shall indemnify Meyer, to the full extent permitted or authorized by the
Ohio General Corporation Law as it may from time to time be amended, if Meyer is made or threatened
to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative, by reason of the fact that Meyer is or was a
director, officer, or employee of Key or any Subsidiary, or is or was serving at the request of Key
or any Subsidiary as a director, trustee, officer, or employee of a bank, corporation, partnership,
joint venture, trust, or other enterprise. The indemnification provided by this Section 11 shall
not be deemed exclusive of any other rights to which Meyer may be entitled under the articles of
incorporation or the regulations of Key or of any Subsidiary, or any agreement, vote of
shareholders or disinterested directors, or otherwise, both as to action in Meyer’s official
capacity and as to action in another capacity while holding such office, and shall continue as to
Meyer after Meyer has ceased to be a director, trustee, officer, or employee and shall inure to the
benefit of the heirs, executors, and administrators of Meyer.

12. Reimbursement of Certain Expenses.

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12.1 Key shall pay, as incurred, all expenses, including the reasonable fees of counsel engaged
by Meyer, of defending any action brought to have this Agreement declared invalid or
unenforceable.

12.2 Key shall pay, as incurred, all expenses, including the reasonable fees of counsel engaged
by Meyer, of prosecuting any action to compel Key to comply with the terms of this Agreement
upon receipt from Meyer of an undertaking to repay Key for such expenses if, and only if, it is
ultimately determined by a court of competent jurisdiction that Meyer had no reasonable grounds
for bringing that action (which determination need not be made simply because Meyer fails to
succeed in the action).

12.3 Expenses (including attorney’s fees) incurred by Meyer in defending any action, suit, or
proceeding commenced or threatened against Meyer for any action or failure to act as an
employee, officer, or director of Key or any Subsidiary shall be paid by Key, as they are
incurred, in advance of final disposition of the action, suit, or proceeding upon receipt of an
undertaking by or on behalf of Meyer in which he agrees to reasonably cooperate with Key or the
Subsidiary, as the case may be, concerning the action, suit, or proceeding, and (a) if the
action, suit, or proceeding is commenced or threatened against Meyer for any action or failure
to act as a director, to repay the amount if it is proved by clear and convincing evidence in a
court of competent jurisdiction that his action or failure to act involved an act or omission
undertaken with deliberate intent to cause injury to Key or a Subsidiary or with reckless
disregard for the best interests of Key or a Subsidiary or (b) if the action, suit, or
proceeding is commenced or threatened against Meyer for any action or failure to act as an
officer or employee, to repay the amount if it is ultimately determined that he is not entitled
to be indemnified. The obligation of Key to advance expenses provided for in this Section 12.3
shall not be deemed exclusive of any other rights to which Meyer may be entitled under the
articles of incorporation or the regulations of Key or of any Subsidiary, or any agreement, vote
of shareholders or disinterested directors, or otherwise.

13. Gross-Up of Payments Deemed to be Excess Parachute Payments.

13.1 Key and Meyer acknowledge that, following a Change of Control, one or more payments or
distributions to be made by Key to or for the benefit of Meyer (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement, under some other plan,
agreement, or arrangement, or otherwise) (a “Payment”) may be determined to be an “excess
parachute payment” that is not deductible by Key for Federal income tax purposes and with
respect to which Meyer will be subject to an excise tax because of Sections 280G and 4999,
respectively, of the Internal Revenue Code (hereinafter referred to respectively as “Section
280G” and “Section 4999”). If Meyer’s employment is terminated after a Change of Control
occurs, the Accounting Firm, which, subject to any inconsistent position asserted by the
Internal Revenue Service, shall make all determinations required to be made under this Section
13, shall determine whether any Payment would be an excess parachute payment and shall
communicate its determination, together with detailed supporting calculations, to Key and to
Meyer within 30 days after the Termination Date or such earlier time as is requested by Key.
Key and Meyer shall cooperate with each other and the Accounting Firm and shall

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provide necessary information so that the Accounting Firm may make all such determinations. Key
shall pay all of the fees of the Accounting Firm for services performed by the Accounting Firm
as contemplated in this Section 13.

13.2 If the Accounting Firm determines that any Payment gives rise, directly or indirectly, to
liability on the part of Meyer for excise tax under Section 4999 (and/or any penalties and/or
interest with respect to any such excise tax), Key shall make additional cash payments to Meyer,
from time to time and at the same time as any Payment constituting an excess parachute payment
is paid or provided to Meyer, in such amounts as are necessary to put Meyer in the same
position, after payment of all federal, state, and local taxes (whether income taxes, excise
taxes under Section 4999 or otherwise, or other taxes) and any and all penalties and interest
with respect to any such excise tax, as Meyer would have been in after payment of all federal,
state, and local income taxes if the Payments had not given rise to an excise tax under Section
4999 and no such penalties or interest had been imposed.

13.3 If the Internal Revenue Service determines that any Payment gives rise, directly or
indirectly, to liability on the part of Meyer for excise tax under Section 4999 (and/or any
penalties and/or interest with respect to any such excise tax) in excess of the amount, if any,
previously determined by the Accounting Firm, Key shall make further additional cash payments to
Meyer not later than the due date of any payment indicated by the Internal Revenue Service with
respect to these matters, in such amounts as are necessary to put Meyer in the same position,
after payment of all federal, state, and local taxes (whether income taxes, excise taxes under
Section 4999 or otherwise, or other taxes) and any and all penalties and interest with respect
to any such excise tax, as Meyer would have been in after payment of all federal, state, and
local income taxes if the Payments had not given rise to an excise tax under Section 4999 and no
such penalties or interest had been imposed.

13.4 If Key desires to contest any determination by the Internal Revenue Service with respect to
the amount of excise tax under Section 4999, Meyer shall, upon receipt from Key of an
unconditional written undertaking to indemnify and hold Meyer harmless (on an after tax basis)
from any and all adverse consequences that might arise from the contesting of that
determination, cooperate with Key in that contest at Key’s sole expense. Nothing in this
Section 13.4 shall require Meyer to incur any expense other than expenses with respect to which
Key has paid to Meyer sufficient sums so that after the payment of the expense by Meyer and
taking into account the payment by Key with respect to that expense and any and all taxes that
may be imposed upon Meyer as a result of his receipt of that payment, the net effect is no cost
to Meyer. Nothing in this Section 13.4 shall require Meyer to extend the statute of limitations
with respect to any item or issue in his tax returns other than, exclusively, the excise tax
under Section 4999. If, as the result of the contest of any assertion by the Internal Revenue
Service with respect to excise tax under Section 4999, Meyer receives a refund of a Section 4999
excise tax previously paid and/or any interest with respect thereto, Meyer shall promptly pay to
Key such amount as will leave Meyer, net of the repayment and all tax effects, in the same
position, after all taxes and interest, that he would have been in if the refunded excise tax
had never been paid.

15

 

14. Vesting of LTIC Stock Grants Upon Retirement. If Meyer retires after age 55 but before he
attains age 65 and the Committee approves of his retirement, for purposes of vesting (to the extent
not already vested) a pro rata number of shares of restricted stock, shares of phantom restricted
stock and/or Performance Shares, all as specified or permitted by the respective award
instruments, Meyer shall be treated under each award instrument as if, on the Termination Date, he
retired having achieved age 65. If any applicable award instrument does not specify the affect of
retirement having reached age 65, then Mr. Meyer shall be treated only for such purposes as if he
had died on the Termination Date.

15. Vesting of, and Extension of Exercise Period for, Stock Options. All stock options (other than
so-called “performance options,” which are options that vest or become exercisable only if certain
stock price and/or financial performance tests are achieved) granted to Meyer by Key after February
1, 2001 that remain outstanding on the Termination Date shall be deemed to have vested (to the
extent not already vested) as of immediately prior to the termination of his employment unless
Meyer’s employment is terminated by Key for Cause, by Meyer’s Voluntary Resignation before the
fifth anniversary of the date of grant of the particular stock option, or as a result of death or
disability. Each stock option (other than any performance option) granted to Meyer by Key after
February 1, 2001 that remains outstanding and is vested on the Termination Date (whether pursuant
to the immediately preceding sentence or otherwise) shall be exercisable after the Termination Date
until that particular option’s expiration date (which is the last date that the option would be
exercisable in accordance with its terms if Meyer had continued in Key’s employment indefinitely)
unless Meyer’s employment is terminated by Key for Cause or by Meyer’s Voluntary Resignation before
the fifth anniversary of the date of grant of the particular stock option. In the case of
incentive stock options granted to Meyer by Key after February 1, 2001, this Section 15 shall
apply, recognizing however that failure to exercise the incentive stock option within the time
periods after the Termination Date prescribed by the Internal Revenue Code may cause the option to
fail to qualify for incentive stock option treatment under the Internal Revenue Code. If, in
accordance with its terms and without regard to this Section 15, an option would vest earlier than
is provided in this Section 15 or would be exercisable for a longer period than is provided in this
Section 15, the terms of the option providing for earlier vesting and/or a longer period of
exercisability, as the case may be, shall govern. Each stock option (other than performance
options) granted to Meyer by Key after February 1, 2001 shall be deemed to contain the provisions
of this Section 15 as a part of the award instrument evidencing such option.

16. Post-Termination Benefits. Following termination of his employment with Key for any reason
other than Cause, Voluntary Resignation, or death, Key shall continue to provide to Meyer the
following benefits:

(a) Payment of an amount equal to the meeting fee and payment of reasonable expenses
for a meeting of the Board of Directors if Meyer attends Key’s annual meeting of
shareholders at the invitation or request of Key's Chief Executive
Officer.

(b) Use of office space and secretarial support in Key facilities in Cleveland for a
period of five years following the Termination Date.

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(c) Payment of monthly membership dues at one country club, one luncheon club, and one
professional or cultural group or association located in the
Greater Cleveland metropolitan area; provided, however, that at any time after the fifth
anniversary of the Termination Date, Key may, by giving written notice to Meyer signed
by the Chair of the Committee, cease paying dues under this Section 16(c) if Meyer no
longer utilizes the club or clubs in question in connection with clients or business
activities that are a benefit to Key.

(d) Payment of the cost of tax preparation assistance but only to the extent and as long
as Key provides this benefit to its executive officers; provided, however, that at any
time after the fifth anniversary of the Termination Date, Key may, by giving written
notice to Meyer signed by the Chair of the Committee, cease paying the cost of tax
preparation assistance under this Section 16(d) in respect of any tax year which begins
after the date Key gives such written notice to Meyer.

17. Savings Clause. If any payments otherwise payable to Meyer under this Agreement are prohibited
by any applicable statute or regulation in effect at the time the payments would otherwise be
payable, including, without limitation, any regulation issued by the Federal Deposit Insurance
Corporation (the “FDIC”) that limits so called “golden parachute payments” that can be made by an
FDIC insured institution or its holding company if the institution is financially troubled and
certain so-called “indemnification payments” (any such statute or regulation being a “Limiting
Rule”):

(a) Key will use its best efforts to obtain the consent of the appropriate governmental
agency (whether the FDIC or any other agency, and including using its best efforts to
appeal any refusal by any such agency to grant its consent) to the payment by Key to
Meyer of the maximum amount that is permitted (up to the amounts that would be due to
Meyer under this Agreement or otherwise absent the Limiting Rule); and

(b) Meyer will be entitled to elect to have apply, and therefore to receive benefits
directly under, either (i) this Agreement (as limited by the Limiting Rule) or (ii) any
generally applicable Key plan or policy (including any severance, separation pay, and/or
salary continuation plan that may be in effect at the time of Meyer’s termination), up
to the amounts that would be due to Meyer under this Agreement or otherwise absent the
Limiting Rule.

18. Compliance with Section 409A of the Internal Revenue Code. To the extent applicable, it is
intended that this Agreement comply with the provisions of Section 409A of the Internal Revenue
Code (hereinafter referred to as “Section 409A”). This Agreement shall be administered in a manner
consistent with this intent, and any provision that would cause the Agreement to fail to satisfy
Section 409A shall have no force and effect until amended to comply with Section 409A.
Notwithstanding any provision of this Agreement to the contrary, in the event any payment or
benefit hereunder is determined to constitute nonqualified deferred compensation subject to Section
409A, then to the extent necessary to comply with Section

17

 

409A, such payment or benefit shall not be made, provided or commenced until six months after
Meyer’s “separation from service” as such phrase is defined for purposes of Section 409A.

19. Survival of Obligations. Except as is otherwise expressly provided in this Agreement, the
respective obligations of Key and Meyer hereunder shall survive any termination of Meyer’s
employment under this Agreement.

20. Merger or Transfer of Assets of Key. Key will not consolidate with or merge into any other
corporation, or transfer all or substantially all of its assets to another corporation, unless such
other corporation shall assume this Agreement in a signed writing and deliver a copy thereof to
Meyer. Upon such assumption the successor corporation shall become obligated to perform the
obligations of Key under this Agreement, and the term “Key” as used in this Agreement shall be
deemed to refer to such successor corporation.

21. Notices. Notices and all other communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when delivered in person (to the Secretary of
Key in the case of notices to Key and to Meyer in the case of notices to Meyer) or mailed by United
States registered mail, return receipt requested, postage prepaid, as follows:

If to Key:

KeyCorp

127 Public Square

Cleveland, Ohio 44114-1306

Attention: Secretary

If to Meyer:

Mr. Henry L. Meyer III

3385 Roundwood Road

Hunting Valley, Ohio 44022

or such other address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

22. Validity. The invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement which shall remain
in full force and effect.

23. Miscellaneous. No provision of this Agreement may be modified, waived, or discharged unless
such waiver, modification, or discharge is agreed to in a writing signed by Meyer and Key. No
waiver by either party hereto at any time of any breach by the other party of, or compliance with,
any condition or provision of this Agreement to be performed by such other party shall be deemed a
waiver of similar or dissimilar provisions or conditions at the same time or at any prior or
subsequent time. No agreement or representation, oral or otherwise, express or implied, with
respect to the subject matter hereof has been made by either party which is not set forth expressly

18

 

in this Agreement. This Agreement shall be governed by and construed in accordance with the laws
of the State of Ohio.

24. Prior Agreement. This Agreement supersedes the agreement entered into between Meyer and Key as
of October 15, 1996 that provided Meyer certain protection in the event of a Change of Control of
Key.

25. Definitions.

25.1 Accounting Firm. The term “Accounting Firm” means the independent auditors of Key for the
fiscal year preceding the earlier of (i) the year in which the Termination Date occurred, or
(ii) the year, if any, in which occurred the first Change of Control occurring after the
Effective Date, and such firm’s successor or successors; provided, however, if such firm is
unable or unwilling to serve and perform in the capacity contemplated by this Agreement, Key
shall select another national accounting firm of recognized standing to serve and perform in
that capacity under this Agreement, except that such other accounting firm shall not be the then
independent auditors for Key or any of its affiliates (as defined in Rule 12b-2 promulgated
under the Securities Exchange Act of 1934, as amended (the “1934 Act”)).

25.2 Average Annual Incentive Compensation. The term “Average Annual Incentive Compensation”
means the sum of Average Short Term Incentive Compensation, as defined in Section 25.4 below,
and Average Long Term Incentive Compensation, as defined in Section 25.3 below. For purposes of
this Agreement:

(a) incentive compensation means any cash based incentive compensation, including
bonuses and is calculated before any reduction on account of deferrals;

(b) notwithstanding the fact that they are made in restricted stock, phantom restricted
stock, and/or Performance Shares rather than in cash, any LTIC Stock Grant shall be
deemed to be long term incentive compensation;

(c) short term incentive compensation means incentive compensation for periods of time
of one year or less;

(d) targeted short term incentive compensation means:

(i) if the short term incentive compensation plan, program, or arrangement in question
designates a targeted amount or a targeted level of achievement applicable to Meyer, it means
that targeted amount or level;

(ii) if the short term incentive compensation plan, program, or arrangement in question has only
one level of payout applicable to Meyer (other than zero), it means that level (i.e.: the level
other than zero);

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(iii) if the short term incentive compensation plan, program, or arrangement in question does
not designate a targeted amount or level of achievement applicable to Meyer but does have
multiple anticipated levels of possible payout or achievement applicable to Meyer, it means (in
each case excluding from consideration any level that results in zero payout) the middle level
of payout or achievement applicable to Meyer (or if there are an even number of levels, the
average of the two levels if there are only two levels or the average of the middle two levels
if there are four or more levels); and

(iv) in all other cases, the amount anticipated or projected to be paid under the plan, program,
or arrangement in question at the time the performance period in question commenced.

25.3 Average Long Term Incentive Compensation. The term “Average Long Term Incentive
Compensation” means:

(a) if the Relevant Year is 2004, the higher of:

(i) the dollar value of the 2003 LTIC Stock Grant; and

(ii) the dollar value of the 2004 LTIC Stock Grant; and

(b) if the Relevant Year is 2005 or any later year, the higher of:

(i) the average of the dollar value of the LTIC Stock Grants made to Meyer
in each of the two years immediately preceding the Relevant Year (e.g., the
average of the 2004 LTIC Stock Grant and the 2005 LTIC Stock Grant if the
Relevant Year is 2006), or, if for any reason an LTIC Stock Grant was made
to Meyer in only one of those two immediately preceding years, the dollar
value of the LTIC Stock Grant for that single year; and

(ii) the dollar value of the LTIC Stock Grant for the Relevant Year.

For purposes of this Section 25.3, the dollar value of any LTIC Stock Grant means the aggregate
Fair Market Value of the Common Shares or phantom stock units subject to that grant (whether those
Common Shares are restricted Common Shares or Performance Shares or whether those shares of phantom
stock are restricted shares of phantom stock) as of the date the grant is made, taking into
account all and only all of the target levels of those Common Shares and shares of phantom stock
without regard to changes in Key’s stock price after the date of grant or to any restrictions on or
contingencies concerning those Common Shares or shares of phantom stock.

25.4 Average Short Term Incentive Compensation. The term “Average Short Term Incentive
Compensation” means the higher of:

(a) the average of the short term incentive compensation payable to Meyer for each of the last two
years immediately preceding the Relevant Year or, if for any reason short term incentive

20

 

compensation was payable to Meyer for only one of those two years, the amount of short term
incentive compensation payable to Meyer for that year, and

(b) Meyer’s targeted short term incentive compensation for the Relevant Year or for the year
immediately preceding the Relevant Year, whichever is higher.

25.5 Base Salary. The term “Base Salary” means the salary payable to Meyer from time to time
before any reduction for voluntary contributions to the KeyCorp 401(k) Plan or any other
deferral under any other plan. Base Salary does not include imputed income from payment by Key
of country club membership fees or other noncash benefits.

25.6 Board of Directors. The term “Board of Directors,” when used other than with specific
reference to another entity, means the Board of Directors of Key.

25.7 Change of Control. A “Change of Control” shall be deemed to have occurred if, at any time
after the date of this Agreement and while Meyer remains in the employ of Key, there is a Change
of Control under any of clauses (a), (b), (c), or (d) below. For these purposes, Key will be
deemed to have become a subsidiary of another corporation if any other corporation (which term
shall, for all purposes of this
Section 25.7, include, in addition to a corporation, a limited liability company, partnership,
trust, or other organization) owns, directly or indirectly, 50 percent or more of the total
combined outstanding voting power of all classes of stock of Key or any successor to Key.

(a) A Change of Control will have occurred under this clause (a) if Key is a party to a
transaction pursuant to which Key is merged with or into, or is consolidated with, or
becomes the subsidiary of another corporation and either

(i) immediately after giving effect to that transaction, less than 65% of the then outstanding
voting securities of the surviving or resulting corporation or (if Key becomes a subsidiary in
the transaction) of the ultimate parent of Key represent or were issued in exchange for voting
securities of Key outstanding immediately prior to the transaction, or

(ii) immediately after giving effect to that transaction, individuals who were directors of Key
on the day before the first public announcement of (x) the pendency of the transaction or (y)
the intention of any person or entity to cause the transaction to occur, cease for any reason to
constitute at least 51% of the directors of the surviving or resulting corporation or (if Key
becomes a subsidiary in the transaction) of the ultimate parent of Key.

(b) A Change of Control will have occurred under this clause (b) if a tender or exchange
offer shall be made and consummated for 35% or more of the outstanding voting stock of
Key or any person (as the term “person” is used in Section 13(d) and Section 14(d)(2) of
the 1934 Act) is or becomes the beneficial owner of 35% or more of the outstanding
voting stock of Key or there is a report filed on Schedule 13D or Schedule 14D-1 (or any
successor schedule, form or report), each as adopted under the 1934 Act, disclosing the
acquisition of 35% or more of the outstanding voting

21

 

stock of Key in a transaction or series of transactions by any person (as defined
earlier in this clause (b));

(c) A Change of Control will have occurred under this clause (c) if either

(i) without the prior approval, solicitation, invitation, or recommendation of the
Board of Directors any person or entity makes a public announcement of a bona fide
intention (A) to engage in a transaction with Key that, if consummated, would result
in a Change Event (as defined below in this clause (c)), or (B) to “solicit” (as
defined in Rule 14a-1 under the 1934 Act) proxies in connection with a proposal that
is not approved or recommended by the Board of Directors, or

(ii) any person or entity publicly announces a bona fide intention to engage in an
election contest relating to the election of directors of Key (pursuant to
Regulation 14A, including Rule 14a-11, under the 1934 Act),

and, at any time within the 24 month period immediately following the date of the announcement
of that intention, individuals who, on the day before that announcement, constituted the
directors of Key (the “Incumbent Directors”) cease for any reason to constitute at least a
majority thereof unless both (A) the election, or the nomination for election by Key’s
shareholders, of each new director was approved by a vote of at least two-thirds of the
Incumbent Directors in office at the time of the election or nomination for election of such new
director, and (B) prior to the time that the Incumbent Directors no longer constitute a majority
of the Board of Directors, the Incumbent Directors then in office, by a vote of at least 75% of
their number, reasonably determine in good faith that the change in Board membership that has
occurred before the date of that determination and that is anticipated to thereafter occur
within the balance of the 24 month period to cause the Incumbent Directors to no longer be a
majority of the Board of Directors was not caused by or attributable to, in whole or in any
significant part, directly or indirectly, proximately or remotely, any event under subclause (i)
or (ii) of this clause (c).

For purposes of this clause (c), the term “Change Event” shall mean any of the events described
in the following subclauses (x), (y), or (z) of this clause (c):

(x) A tender or exchange offer shall be made for 25% or more of the outstanding voting stock of
Key or any person (as the term “person” is used in Section 13(d) and Section 14(d)(2) of the
1934 Act) is or becomes the beneficial owner of 25% or more of the outstanding voting stock of
Key or there is a report filed on Schedule 13D or Schedule 14D-1 (or any successor schedule,
form, or report), each as adopted under the 1934 Act, disclosing the acquisition of 25% or more
of the outstanding voting stock of Key in a transaction or series of transactions by any person
(as defined earlier in this subclause (x)).

(y) Key is a party to a transaction pursuant to which Key is merged with or into, or is
consolidated with, or becomes the subsidiary of another corporation and, after giving effect to
such transaction, less than 50% of the then outstanding voting securities of the surviving or

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resulting corporation or (if Key becomes a subsidiary in the transaction) of the ultimate parent
of Key represent or were issued in exchange for voting securities of Key outstanding immediately
prior to such transaction or less than 51% of the directors of the surviving or resulting
corporation or (if Key becomes a subsidiary in the transaction) of the ultimate parent of Key
were directors of Key immediately prior to such transaction.

(z) There is a sale, lease, exchange, or other transfer (in one transaction or a series of
related transactions) of all or substantially all the assets of Key.

(d) A Change of Control will have occurred under this clause (d) if there is a sale,
lease, exchange, or other transfer (in one transaction or a series of related
transactions) of all or substantially all of the assets of Key.

25.8 Committee. The term “Committee” means the Compensation Committee of the Board of Directors
of Key or any successor to that committee.

25.9 Common Shares. The term “Common Shares” means common shares of Key.

25.10 Competitive Activity. Meyer shall be deemed to have engaged in “Competitive Activity” if
he engages, without Key’s prior written consent, in any business or business activity in which
Key or any of its Subsidiaries engages, including, without limitation, engaging in any business
activity in the banking or financial services industry (other than as a director, officer, or
employee of Key or any of its Subsidiaries) or has an ownership interest in, or serves as a
director, officer, agent, or employee of, or in any other capacity with, any Financial Services
Company or renders services of a consultative, advisory, or other nature to any Financial
Services Company. Notwithstanding the foregoing, Meyer will not be deemed to have engaged in
Competitive Activity solely because of any one or more investments he may make in any one or
more for profit entity or entities, none of which is a Financial Services Company, or solely
because he owns stock in a publicly held Financial Services Company that constitutes not more
than 1% of the outstanding stock of that Financial Services Company.

25.11 Day. A “day” as used in this Agreement means a calendar day unless business day is
specifically referred to.

25.12 Demotion or Removal. Meyer shall be deemed to have been subjected to “Demotion or
Removal:”

(a) if Meyer ceases to be Chairman of the Board of Key (or, after a Change of Control,
of the Surviving Entity) at any time before the expiration of the term of his employment
pursuant to Section 6.1, other than as a result of the termination of his employment by
Key for Cause or of his Voluntary Resignation or Voluntary Retirement, death, or
disability,

23

 

(b) if Meyer ceases to be or have the responsibilities, duties, or authorities of Chief
Executive Officer of Key (or, after a Change of Control, of the Surviving Entity) at any
time before the expiration of the term of his employment pursuant to Section 6.1, other
than as a result of the termination of his employment by Key for Cause or of his
Voluntary Resignation or Voluntary Retirement, death, or disability, or

(c) if Meyer ceases to be a director of Key (or, after a Change of Control, of the
Surviving Entity) at any time before the expiration of the term of his employment
pursuant to Section 6.1, other than as a result of the termination of his employment by
Key for Cause or of his Voluntary Resignation or Voluntary Retirement, death, or
disability.

25.13 Fair Market Value. The term “Fair Market Value” with respect to Common Shares means:

(a) if the Common Shares are traded on a national exchange, the mean between the high
and low sales price per Common Share on the national exchange on the date for which the
determination of fair market value is made or, if there are no sales of Common Shares on
that date, then on the next preceding date on which there were any sales of Common
Shares, or

(b) if the Common Shares are not traded on a national exchange, the mean between the
high and low sales price per Common Share in the over-the-counter market, National
Market System, as report by the National Quotations Bureau, Inc. and NASDAQ on the date
for which the determination of fair market value is made or, if there are no sales of
Common Shares on that date, then on the next preceding date on which there were any
sales of Common Shares.

The term “Fair Market Value” with respect to phantom stock units means the Fair Market Value of
the equivalent number of Common Shares, as underly the phantom stock units.

25.14 Financial Services Company. The term “Financial Services Company” means a bank, bank
holding company, savings and loan association, building and loan association, savings and loan
holding company, insurance company, investment banking, or securities company, or other
financial services company, other than Key or any of its Subsidiaries.

25.15 Impermissible. The term “Impermissible,” when used in the context of Meyer’s continued
coverage by and participation in any of the Retirement Plans or Savings Plans shall mean that
such a continuation would violate the provisions of any such plan, would cause any such plan
that is or is intended to be qualified under Section 401(a) of the Internal Revenue Code to fail
to be so qualified, would require shareholder approval, or would be unlawful.

25.16 Long Term Disability Plan. The term “Long Term Disability Plan” means and includes the
KeyCorp Long Term Disability Plan as from time to time amended, restated, or otherwise modified,
including any long term disability plan or program that, after the

24

 

Effective Date, succeeds, replaces, or is substituted for that plan and includes long term
disability benefits or rights provided pursuant to or under insurance contracts maintained by
Key applicable to executive officers of Key.

25.17 LTIC Stock Grant. The term “LTIC Stock Grant” means the grant, if any, of restricted
stock, of phantom restricted stock, of Performance Shares, or a combination of restricted stock,
phantom restricted stock and/or Performance Shares made by the Committee to Meyer during any
particular year as part of Key’s ongoing compensation program. For greater clarity, for
purposes of this Agreement, LTIC Stock Grants include:

(a) The grant of 40,485 shares of phantom restricted stock made by the Committtee to
Meyer by resolution adopted January 16, 2003 constitutes the 2003 LTIC Stock Grant.

(b) The grant of 31,163 shares of Performance-Based Restricted Stock, 31,162 shares of
Cash Performance Shares, and 31,163 Stock Performance Shares made by the Committee
effective February 19, 2004 under the 2004 Equity Compensation Plan subject to the
approval of the Plan by the shareholders of KeyCorp, which approval occurred on May 13,
2004, constitutes the 2004 LTIC Stock Grant. The terms “2005 LTIC Stock Grant,” “2006
LTIC Stock Grant,” etc. refer to LTIC Stock Grants, if any, made to Meyer by resolution
adopted by the Committee in the specified year.

25.18 Majority Action. The term “Majority Action,” when used in reference to the Board of
Directors, means an action taken by the affirmative vote of a majority of the entire number of
members of the Board of Directors.

25.19 Performance Shares. The term “Performance Shares” means an award denominated in Common
Shares or phantom Common Shares the vesting of which is contingent or accelerated upon
attainment of one or more performance goals (absent death, disability, or a Change of Control).

25.20 Relevant Year. The term “Relevant Year” means the year in which the Termination Date
occurs unless, during the two year period ending on the Termination Date, there has occurred one
or more Changes of Control, in which case the term “Relevant Year” means the year in which
occurred the first Change of Control that occurred during that two year period.

25.21 Retiree Medical Benefits Plan. The term “Retiree Medical Benefits Plan” means and
includes the KeyCorp Medical Benefits Plan For Retirees as from time to time amended, restated,
or otherwise modified, including any plan that, after the Effective Date, succeeds, replaces, or
is substituted for that plan.

25.22 Retirement Plans. The term “Retirement Plans” means and includes the KeyCorp Cash Balance
Pension Plan, which succeeded by merger the Retirement Plan for Employees of Society Corporation
and Subsidiaries, and the Supplemental Retirement Plan, in all cases,

25

 

as from time to time amended, restated, or otherwise modified, including any plan that, after
the Effective Date, succeeds, replaces, or is substituted for any such plan, and all retirement
plans of any nature maintained by Key or any of its Subsidiaries in which Meyer was
participating prior to the Termination Date. Reference to a “Retirement Plan,” in the
singular, means any of the Retirement Plans.

25.23 Savings Plan. The term “Savings Plans” means and includes the KeyCorp 401(k) Savings Plan
and the KeyCorp Excess 401(k) Savings Plan, in both cases, as from time to time amended,
restated, or otherwise modified, including any plan that, after the Effective Date, succeeds,
replaces, or is substituted for either such plan, and all salary reduction, savings,
profit-sharing, or stock bonus plans (including, without limitation, all plans involving
employer matching contributions, whether or not constituting a qualified cash or deferred
arrangement under Section 401(k) of the Internal Revenue Code), maintained by Key or any of its
Subsidiaries in which Meyer was participating prior to the Termination Date. Reference to a
“Savings Plan,” in the singular, shall mean any of the Savings Plans.

25.24 Subsidiary. The term “Subsidiary,” as of any time, means any corporation, bank,
partnership, or other entity a majority of the voting control of which is directly or indirectly
owned or controlled at that time by Key or, after a Change of Control, by the Surviving Entity.

25.25 Surviving Entity. The term “Surviving Entity” means the entity surviving or resulting
from any Change of Control involving Key or (if Key becomes a subsidiary in the transaction) the
ultimate parent of Key.

25.26 Supplemental Retirement Plan. The term “Supplemental Retirement Plan” means the KeyCorp
Supplemental Retirement Plan, which succeeded by merger the Amended and Restated Society
Corporation Supplemental Retirement Plan, in all cases, as from time to time amended, restated,
or otherwise modified, including any plan that, after the Effective Date, succeeds, replaces, or
is substituted for the KeyCorp Supplemental Retirement Plan.

25.27 Termination Date. The term “Termination Date” means the date on which Meyer’s employment
with Key and its Subsidiaries terminates.

25.28 Voluntary Resignation. The term “Voluntary Resignation” means a termination by Meyer of
his employment with Key and its Subsidiaries before the expiration of the term of his employment
pursuant to Section 6.1 by voluntarily resigning at his own instance without having been
requested to so resign by Key, provided, however:

(a) A resignation by Meyer will not be deemed to be a Voluntary Resignation if it occurs
at a time when Meyer is entitled to terminate his employment on grounds of Constructive
Termination;

(b) Meyer will not be considered to have Voluntarily Resigned if he retires at any time
on or after February 1, 2011; and

26

 

(c) Meyer will not be considered to have Voluntarily Resigned if he retires at any time
before February 1, 2011 with the approval of the Board of Directors or the Committee.

25.29 Voluntary Retirement. The term “Voluntary Retirement” means a termination by Meyer of his
employment with Key and its Subsidiaries by voluntarily retiring at his own instance without
having been requested to so retire by Key, except that any retirement by Meyer will not be
deemed to be a Voluntary Retirement if it occurs at a time when Meyer is entitled to terminate
his employment on grounds of Constructive Termination.

          IN WITNESS WHEREOF, Key and Meyer have executed this Agreement, Key by its duly authorized
Vice Chairman of the Board, as of the date first written above.

	 	 	 	 	 
	 	 	KEYCORP
	 
	 	 	 	 
	

	 	By:
	 	/s/ THOMAS C. STEVENS
	

	 	 	 	 
	

	 	 	 	Thomas C. Stevens
	

	 	 	 	Vice Chairman of the Board
	 
	 	 	 	 
	 	 	/s/ HENRY L. MEYER III
	 	 	 
	 	 	HENRY L. MEYER III

27Exhibit 10.2

 

Exhibit 10.2

KEYCORP

Executive Officer Grants

(Award Of Performance-Based Restricted Stock, Cash Performance Shares and

Stock Performance Shares)

 
«Name»

     By action of the Compensation Committee (the “Committee”) of the Board of Directors of
KeyCorp, taken pursuant to the KeyCorp 2004 Equity Compensation Plan (the “Plan”), and subject to
the terms and conditions of the Plan, you have been awarded «Stock» shares of Restricted Stock
subject to vesting upon the achievement of specified performance criteria (the “Performance-Based
Restricted Stock”), «Stock» Performance Shares payable in cash, subject to vesting upon the
achievement of specified performance criteria (the “Cash Performance Shares”) and «Stock»
Performance Shares payable in Common Shares and cash, subject to vesting upon the achievement of
specified performance criteria (the “Stock Performance Shares”), as described below. The
Performance-Based Restricted Stock, the Cash Performance Shares and the Stock Performance Shares
shall be referred to herein collectively as the “Awarded Shares”. Unless otherwise indicated, the
capitalized terms used herein and in the attached Acceptance of Grant Agreement (the “Agreement”)
shall have the same meaning as set forth in the Plan.

	1.  	Date of Grant. The effective date of grant for the award of the Awarded Shares shall
be February 15, 2005 (the “date of grant”).
	 
	2.  	Vesting of the Awarded Shares.

	 	(a)  	In General. Your right to receive the Awarded Shares shall be determined on
the basis of KeyCorp’s Earnings per Share, Economic Profit Added and Return on Equity
(as defined in Appendix C to the resolutions of the Committee adopted on March
17, 2005 approving the performance goals for the Awarded Shares (the “Resolutions”))
during the period of January 1, 2005 through December 31, 2007 (the “Performance
Period”). You are able to earn up to 100% of the Performance-Based Restricted Stock
and Cash Performance Shares if the applicable targeted level of performance is met or
exceeded and up to 100% of the Stock Performance Shares if the applicable maximum level
of performance is met or exceeded.
	 
	 	(b)  	Vesting of Performance-Based Restricted Stock. The Common Shares subject to
this grant of Performance-Based Restricted Stock may not be sold, transferred,
otherwise disposed of, pledged or otherwise hypothecated until February 15, 2008, but
only if (A) you have been in the continuous employ of KeyCorp or a Subsidiary through
such date and (B) the Committee shall determine that the

 

 

	 	   	Performance-Based Restricted Stock has been earned as set forth on Appendix
C to the Resolutions.

	 	(c)  	Vesting of Performance Shares. The Cash Performance Shares and Stock
Performance Shares granted hereunder shall be vested on February 15, 2008, but only if
(A) you have been in the continuous employ of KeyCorp or a Subsidiary through such date
and (B) the Committee shall determine that the Cash Performance Shares and Stock
Performance Shares have been earned as set forth on Appendix C to the
Resolutions.
	 
	 	(d)  	Determination by Committee. The amount of the Awarded Shares that will become
vested and the level of attainment of the applicable performance goals set forth on
Appendix C to the Resolutions shall be determined by the Committee as soon as
practicable after the receipt of the audited financial statements for KeyCorp relating
to the last year of the Performance Period, but in no event later than two and one-half
months after the close of the last year of the Performance Period.
	 
	 	(e)  	Transfers Void. Any purported transfer or encumbrance of the Awarded Shares
prior to the time that they have vested shall be void, and the other party to any such
purported transaction shall not obtain any rights to or interest in the Common Shares
underlying the Awarded Shares.

	3.  	Payment of Performance Shares. Payment of any earned Cash Performance Shares shall
be made in the form of cash and payment of any earned Stock Performance Shares shall be made
one-half in the form of Common Shares and one-half in the form of cash. Payment shall occur
as soon as practicable after the receipt of the audited financial statements for KeyCorp
relating to the last year of the Performance Period, but in no event later than two and
one-half months after the close of the last year of the Performance Period. To the extent an
award is payable in cash, each Cash Performance Share and Stock Performance Share shall have a
value equal to the Fair Market Value (as defined in subsection 2.16 of the Plan) of one Common
Share on the date of vesting of the Cash Performance Share and/or Stock Performance Share.

	4.  	Death; Disability; Retirement at or after Age 65. If you shall die or become
Disabled or if you shall retire at age 65 or older prior to the vesting of the Awarded Shares,
then a pro rata number of the shares of Awarded Shares actually earned as provided on
Appendix C to the Resolutions shall be retained by you or your estate and become
freely transferable or entitle you to the payment described in paragraph 3, as the case may
be, following the determination of the attainment of the performance goals upon conclusion of
the Performance Period, but the remainder shall immediately be forfeited.

	5.  	Retirement between ages 55 and 65. The Awarded Shares shall immediately be forfeited
if you retire between the ages of 55 and 65 prior to the vesting of the Awarded Shares;
provided, however, that the Committee may in its sole discretion determine that a pro rata

2

 

	 	   	number of the Awarded Shares shall be retained by or issued to you and become freely
transferable or entitle you to the payment described in paragraph 3, as the case may be,
following the determination of the attainment of the performance goals upon conclusion of
the Performance Period but that the remainder shall immediately be forfeited.

	6.  	Pro-Ration. For purposes of this Agreement the pro rata number of Awarded Shares
granted to you shall be based on a fraction the numerator of which is the number of months
beginning in February, 2005 that are completed prior to your change of status and the
denominator of which is 36.

	7.  	Forfeiture. The Awarded Shares shall be immediately forfeited if your employment
with KeyCorp or any Subsidiary terminates prior to the vesting of the Awarded Shares as set
forth in paragraph 2 unless your employment terminates because of death, Disability or
retirement at or after age 65 (in which case the specific provisions of paragraph 4 shall
apply); provided, however, that the Committee may in its sole discretion determine that a pro
rata number of the Awarded Shares shall be retained by you and become freely transferable or
entitle you to the payment described in paragraph 3, as the case may be, following the
determination of the attainment of the performance goals upon conclusion of the Performance
Period but that the remainder shall immediately be forfeited.

	8.  	KeyCorp Stock Ownership Guidelines. If you have not met KeyCorp’s Stock Ownership
Guidelines when the Performance-Based Restricted Stock or Stock Performance Shares vest as set
forth in paragraph 2, you may not sell or otherwise transfer the Performance-Based Restricted
Stock or the Stock Performance Shares payable in Common Shares until and unless you meet the
Stock Ownership Guidelines or terminate your employment with KeyCorp or a Subsidiary;
provided, however, that notwithstanding the foregoing you shall be permitted to sell the
number of shares necessary to satisfy any withholding tax obligation that may arise in
connection with the vesting of the Performance-Based Restricted Stock and Stock Performance
Shares even if you have not met the Stock Ownership Guidelines.

	9.  	Deferral.

	 	(a)  	If you are eligible to participate in the KeyCorp Deferred Compensation Plan
(“Deferred Plan”) on the date of election, you may elect to exchange the
Performance-Based Restricted Stock or the Stock Performance Shares payable in Common
Shares for an award of equal value which shall be deferred into the Deferred Plan
Common Stock Account; provided, however, that such election shall be made at least one
year prior to the vesting of the Performance-Based Restricted Stock and Stock
Performance Shares and provided further that the deferred award may not be transferred
to another account in the Deferred Plan.
	 
	 	(b)  	If you are eligible to participate in the Deferred Plan on the date of
election, you may elect to exchange the Cash Performance Shares or the Stock
Performance Shares payable in cash for an award of equal value which shall be deferred
into

3

 

	 	   	any of the investment vehicles provided for in the Deferred Plan, as selected by
you; provided, however, that such election shall be made at least one year prior to
the vesting of the Cash Performance Shares.

	10.  	Harmful Activity. Notwithstanding any other provisions of this Agreement, if you
engage in any “harmful activity” (as defined in Section 17 of the Plan) prior to or within six
months after your termination of employment with KeyCorp or a Subsidiary, then any and all shares of Performance-Based Restricted Stock and Stock Performance Shares which have vested
and any cash paid upon the vesting of the Cash Performance Shares, on or after one year prior
to termination of employment shall be immediately forfeited to KeyCorp and any profits
realized upon your sale of any shares of Performance-Based Restricted Stock or Stock
Performance Shares shall inure to and be payable to KeyCorp upon demand.

	11.  	No Acceleration. The provisions of Section 12 of the Plan entitled “Acceleration
upon Change of Control” shall not apply to the Awarded Shares awarded pursuant to this
Agreement; provided, however, that in the event of a Change of Control, the performance goals
relating to the Performance-Based Restricted Stock and Cash Performance Shares (and not the
Stock Performance Shares) shall be deemed to be satisfied at 100% of target and the
Performance-Based Restricted Stock and the Cash Performance Shares shall vest on the earlier
of: (a) February 15, 2008, or (b) the date not more than two years on or after a Change of
Control upon which your employment terminates under circumstances entitling you to receive
severance benefits or salary continuation benefits under KeyCorp’s Separation Pay Plan or
under any employment or change of control or similar arrangement or agreement, but only if you
have been in the continuous employ of KeyCorp or a Subsidiary through such date.

	12.  	Rights as a Shareholder - Performance-Based Restricted Stock. (a) From and after the
date of grant, you shall have all of the rights of a shareholder with respect to the shares of
Performance-Based Restricted Stock granted hereby, including the right to vote the shares of
Performance-Based Restricted Stock and receive any dividends that may be paid thereon;
provided however that any additional Common Shares or other securities that you may become
entitled to receive pursuant to a stock dividend, stock split, combination of shares,
recapitalization, merger, consolidation, separation or reorganization or any other change in
the capital structure of the Company shall be subject to the same restrictions as the shares
of Performance-Based Restricted Stock covered by this award.

	      	(b)  	Notwithstanding (a) above, from and after the date of grant, you shall be entitled to
dividend equivalents, in cash, on the Cash Performance Shares granted hereby when and if a
dividend is declared by KeyCorp’s Board of Directors.

	13.  	Compliance with Section 409A of the Internal Revenue Code. To the extent applicable,
it is intended that this award and the Plan comply with the provisions of Section 409A of the
Internal Revenue Code. This award and the Plan shall be administrated in a manner consistent
with this intent, and any provision that would cause the award or the Plan to

4

 

	 	   	fail to satisfy Section 409A shall have no force and effect until amended to comply with
Section 409A (which amendment may be retroactive to the extent permitted by Section 409A and
may be made by KeyCorp without your consent). In particular, to the extent your right to
receive payment of Cash Performance Shares becomes nonforfeitable under the terms of
paragraph 11 above and the event triggering your right to payment is your termination of
employment, then notwithstanding anything to the contrary in paragraph 11 above, payment
will be made to you on the earlier of (a) your “separation from service” with KeyCorp
(determined in accordance with Section 409A); provided, however, that in case you are a
“specified employee” (within the meaning of Section 409A), your date of payment shall be 6
months after the date of your separation from service with KeyCorp or (b) your death.

	14.  	Condition. The award of the Awarded Shares granted hereby is conditioned upon your
execution and delivery to KeyCorp of the Agreement set forth hereinafter.

	15.  	Amendment and Modification. The terms and conditions of this award may not be
modified, amended or waived except by an instrument in writing signed by a duly authorized
executive officer of KeyCorp.

	 	 	 	 	 
	 	 	 	, 2005	

	

	 	

	 	Thomas E. Helfrich
	

	 	 	 	Executive Vice President

5

 

ACCEPTANCE OF GRANT AGREEMENT

     I acknowledge receipt of the above Performance-Based Restricted Stock, Stock Performance
Shares and Cash Performance Shares and in consideration thereof I accept such awards subject to the
terms and conditions of the Plan (including, without limitation, the harmful activity provisions
thereof) and the restrictions upon me as set forth hereinafter in this Agreement.

     My agreement to the following restrictions is (i) in addition to (and not in limitation of)
any other agreements, plans, policies, or practices that are applicable to me as a KeyCorp or a
Subsidiary (collectively “Key”) employee, (ii) independent of any Plan provisions, and (iii)
binding upon me regardless of whether I sell, transfer, otherwise dispose of, pledge, or otherwise
hypothecate the Common Shares acquired under the Performance-Based Restricted Stock awarded to me.

	1.  	I recognize the importance of preserving the confidentiality of Non-Public Information of
Key. Therefore, I acknowledge and agree that: (a) during my employment with Key, I will
acquire, reproduce, and use such Non-Public Information only to the extent reasonably
necessary for the proper performance of my duties; (b) during and after my employment with
Key, I will not use, publish, sell, trade or otherwise disclose such Non-Public Information;
and (c) upon termination of my employment with Key, I will immediately return to Key all
documents, data, and things in my possession or to which I have access that involve such
Non-Public Information. I agree to sign nondisclosure agreements in favor of Key and others
doing business with Key with whom Key has a confidential relationship.

	2.  	I acknowledge and agree that the duties of my position at Key may include the development of
Intellectual Property. Accordingly, any Intellectual Property which I create with any of
Key’s resources or assistance, in whole or in part, during my employment with Key, and which
pertains to the business of Key, is the property of Key; and I hereby agree to and do assign
to Key all right, title, and interest in and to such Intellectual Property, including, without
limitation, copyrights, trademarks, service marks, and patents in or to (or associated with)
such Intellectual Property and agree to sign patent applications and assignments thereof,
without additional compensation.

	3.  	Except in the proper performance of my duties for Key, I acknowledge and agree that from the
date hereof through a period of one (1) year after the termination of my employment with Key
for any reason, I will not, directly or indirectly, for myself or on behalf of any other
person or entity, hire or solicit or entice for employment any Key employee without the
written consent of Key, which consent it may grant or withhold in its discretion.

	4.  	(a) Except in the proper performance of my duties for Key, I acknowledge and agree that from
the date hereof through a period of one (1) year after the termination of my employment with
Key for any reason, I will not, directly or indirectly, for myself or on

 

 

	 	   	behalf of any other person or entity, call upon, solicit, or do business with (other than
for a business which does not compete with any business or business activity conducted by
Key) any Key customer or potential customer I interacted with, became acquainted with, or
learned of through access to information while I performed services for Key during my
employment with Key, without the written consent of Key, which consent it may grant or
withhold in its discretion.

(b) In the event that my employment is terminated with Key as a result of a Termination
Under Limited Circumstances as defined below, the restrictions in paragraph 4(a) of this
Agreement shall become inapplicable to me; however, the restrictions in paragraphs 1, 2, and
3 of this Agreement shall remain in full force and effect nevertheless. I understand that a
“Termination Under Limited Circumstances” shall mean the termination of my employment with
Key (i) under circumstances in which I am entitled to receive severance benefits or salary
continuation benefits under the terms and conditions of the KeyCorp Separation Plan in
effect at the time of such termination, or (ii) under circumstances in which I am entitled
to receive severance benefits, salary continuation benefits, or similar benefits under the
terms and conditions of an agreement with Key, including, without limitation, a change of
control agreement or employment or letter agreement, or (iii) as otherwise expressly
approved by the Compensation Committee of KeyCorp in its sole discretion.

	5.  	In the event a court of competent jurisdiction determines that any of the restrictions
contained in the above numbered paragraphs of this Agreement are excessive because of duration
or scope or are otherwise unenforceable, the provisions hereof shall not be void but, with
respect to such limitations held to be excessive, they shall be modified to incorporate the
maximum limitations such court will permit, not exceeding the limitations contained in the
acceptance of grant. In the event I engage in any activity in violation hereof, I acknowledge
that such activity may cause serious damage and irreparable injury to Key, which will permit
Key to terminate my employment (if applicable) and seek monetary damages, and Key shall also
be entitled to injunctive, equitable, and other relief. I acknowledge and agree that the
validity, interpretation, and performance of this Agreement shall be construed under the
internal substantive laws of Ohio.

BY SIGNING THIS ACCEPTANCE OF GRANT AGREEMENT, I ACKNOWLEDGE THAT I HAVE HAD AMPLE OPPORTUNITY TO
READ THIS AGREEMENT AND THE PLAN, MAKE A DILIGENT INQUIRY, ASK QUESTIONS, AND CONSULT WITH MY
ATTORNEY IF I CHOSE TO DO SO.

	

	«Name» – Sign Your Name
	 
	

	Date

2

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