Document:

Exhibit 4.6  

        SUPPLEMENTAL
INDENTURE (this "Supplemental Indenture") dated as of May 20, 2004, between GRIFFON CORPORATION, a Delaware corporation (the "Company"), and AMERICAN STOCK TRANSFER
AND TRUST COMPANY, a New York banking corporation, as trustee under the indenture referred to below (the "Trustee"). 

W
I T N E S S E T H: 

        WHEREAS
the Company has delivered to the Trustee an Indenture (the "Indenture") dated as of July 18, 2003, providing for the issuance of 4.0% Contingent Convertible Subordinated
Notes due 2023 of the Company (the "Securities"); 

        WHEREAS
the Indenture provides that the Company may amend the Indenture without the consent of Holders to cure any ambiguity, omission, defect or inconsistency, or to make any other
change that does not adversely affect the rights of any Securityholder; and 

        WHEREAS
pursuant to Section 9.01 of the Indenture, the Trustee and the Company are authorized to execute and deliver this Supplemental Indenture; 

        NOW
THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company and the Trustee mutually covenant
and agree for the equal and ratable benefit of the holders of the Securities as follows: 

        1.    Capitalized Terms.    Capitalized terms used herein but not defined shall have the meanings assigned to them in
the Indenture. 

        2.    Amendment of Section 10.01(c).    Section 10.01(c) of the Indenture is hereby replaced in its
entirety with the following provision (added language in italics): 

        "(c) the
conversion of such Security occurs during the five Trading Day period immediately after a period of five consecutive Trading Days in which the Security Trading Price for
each Trading Day in such period was less than 95% of the product of the Closing Price per share of Common Stock on such Trading Day multiplied by the number of shares of Common Stock issuable
(assuming satisfaction of conditions to conversion) upon conversion of $1,000 in principal amount of the Securities (the "Conversion Rate"); provided, that, with respect to any
such conversion, if the Closing Price of the Common Stock as of such date of conversion is greater than the Effective Conversion Price but less than 120% of the Effective Conversion Price, then
Holders shall receive in such conversion (a "Principal Value Conversion"), in lieu of Common Stock based on the Conversion Rate, a number of Shares of Common Stock equal to the principal amount of
such Holder's Security plus accrued but unpaid interest (including Contingent Interest), if any, as of the conversion date, divided by the Principal Value Conversion Share Price. The Principal Value
Conversion Share Price shall be equal to the greater of (i) the Effective Conversion Price on the conversion date and (ii) the Closing Price of Common Stock on the conversion date. The
Company shall deliver such Common Stock no later than the third Business Day following the determination of the Principal Value Conversion Share Price. The "Effective Conversion Price" as of any date
of determination shall be equal to $1,000 divided by the Conversion Rate as of the eighth Trading Day prior to the date of determination." 

        3.    Ratification of Indenture; Supplemental Indenture Part of Indenture.    Except as expressly amended hereby, the
Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of
the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby. In the event of a conflict between the terms and conditions of
the Indenture and the terms and conditions of this Supplemental Indenture, then the terms and conditions of this Supplemental Indenture shall prevail. 

        4.    Governing Law.    THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT  

 

 WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

        5.    Trustee Makes No Representation.    The statements herein are deemed to be those of the Company and not those of
the Trustee. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture. 

        6.    Counterparts.    The parties may sign any number of copies of this Supplemental Indenture. Each signed copy
shall be an original, but all of them together represent the same agreement. 

        7.    Effect of Headings.    The Section headings herein are for convenience only and shall not effect the
construction thereof. 

        IN
WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written. 

	 	 	GRIFFON CORPORATION
	

 	
 	
by	

 
	 	 	 	/s/  ROBERT BALEMIAN      
 Name: Robert Balemian

Title: President
	

 	
 	
AMERICAN STOCK TRANSFER AND TRUST COMPANY
	

 	
 	
by	

 
	 	 	 	/s/  JOSEPH WOLF      
 Name: Joseph Wolf

Title: Vice President

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Exhibit 4.4  

 
  MERCANTILE BANKSHARES CORPORATION AND PARTICIPATING
  AFFILIATES UNFUNDED DEFERRED COMPENSATION PLAN
  FOR DIRECTORS    
    

As Amended and Restated Effective March 9, 2004  

Introduction  

        By action of its Board of Directors dated December 14, 1982, Mercantile Bankshares Corporation (the "Sponsor") established the Mercantile Bankshares
Corporation Unfunded Deferred Compensation Plan for Directors (the "Plan"), effective as of January 1, 1983. The Plan was amended and restated effective as of January 1, 1984, to include
a provision for early withdrawals in the event of financial hardship and to make certain other changes requested by the Internal Revenue Service. The Plan was again amended and restated effective as
of December 31, 1995, to modify the early withdrawal provision and to add a feature by which the rate of return credited to the accounts of participants will be linked to the rate of return
achieved by common stock of the Sponsor. The Plan was further amended and restated effective as of March 12, 1996, to modify the distribution provisions of the Plan. Effective as of
March 9, 2004, the Plan has again been amended and restated as hereinafter set forth to change the medium of distribution of participants' accounts from cash to common stock of the Sponsor. All
Affiliates which previously adopted the Plan shall continue as participating Affiliates in the Plan, as so amended and restated, unless and until they withdraw from such participation pursuant to
Section 9(b). Furthermore, with the approval of the Chairman of the Board of Directors or the President of the Sponsor, the Plan, as so amended and restated, may be adopted by the Board of
Directors of any Affiliates of the Sponsor that are not currently participating Affiliates (as more particularly described herein), effective as of March 9, 2004, or as of any later date
specified by any such Affiliate at the time of its adoption of the Plan. 

1.     Purpose  

        The purpose of the Plan is to enable any Director of any Corporation (as hereinafter defined) to defer receipt of fees and other cash compensation otherwise
payable for services as a Director by so electing in accordance with the provisions of the Plan, provided such election is made prior to the date such compensation is earned by the Director. 

2.     Definitions  

        Under the Plan, except where the context indicates otherwise, the following definitions apply: 

        (a)   "Account" shall mean a bookkeeping reserve account established and maintained for each Participant pursuant to
Section 6(a) for purposes of determining the amount payable to the Participant pursuant to Section 7. 

        (b)   "Affiliate" shall mean any corporation in which the Sponsor owns directly or indirectly, as of the date of adoption of
the Plan by the Affiliate, at least eighty percent (80%) of the outstanding voting stock. 

        (c)   "Beneficiary" shall mean the person(s) entitled, pursuant to Section 7(g) of the Plan, to receive payments under
the Plan at and after the death of the Participant, including the person(s) designated by the Participant, the Participant's estate or the estate of a deceased Beneficiary, all as more particularly
described in Section 7(g). 

        (d)   "Board of Directors" shall mean the Board of Directors of the Sponsor or an Affiliate, as the case may be. 

        (e)   "Corporation" shall mean Mercantile Bankshares Corporation and any Affiliate which has adopted the Plan and any successor
thereto by merger, consolidation or otherwise which may agree to continue the Plan. 

 

        (f)    "Committee" shall mean the committee appointed by the Board of Directors of the Sponsor pursuant to Section 3 to
administer the Plan, as the committee may be constituted from time to time, or, in lieu thereof, the Board of Directors of the Sponsor. 

        (g)   "Common Stock" shall mean shares of the Sponsor's authorized and issued common stock, par value of Two Dollars ($2.00)
per share. 

        (h)   "Deferral Agreement" shall mean a written agreement, substantially in the form attached hereto as Exhibit A,
executed by the Participant, on which the Participant specifies his or her elections pursuant to Section 5. 

        (i)    "Deferred Compensation" shall mean the portion of each compensation payment which would have been payable to the
Participant in his or her capacity as a Director while participating in the Plan (whether payable as a directors' retainer or meeting fee or as a fee for service on a committee of the Board of
Directors) and which portion the Director has elected to defer under the terms of an election to participate in the Plan pursuant to Section 5. 

        (j)    "Director" shall mean a member of the Board of Directors of the Sponsor or any Affiliate. 

        (k)   "Fair Market Value" of a share of Common Stock on a particular date under the Plan shall mean the last reported sale
price per share of Common Stock, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to securities listed or admitted to trading on a national securities exchange or included for quotation on the Nasdaq Stock Market, or
if the Common Stock is not so listed or admitted to trading or included for quotation, the last quoted price, or if the Common Stock is not so quoted, the average of the high bid and low asked prices,
regular way, in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotations System or, if such system is no
longer in use, the principal other automated quotations system that may then be in use or, if the Common Stock is not quoted by any such organization, the average of the closing bid and asked prices,
regular way, as furnished by a professional market maker making a market in the Common Stock as selected in good faith by the Committee or by such other source or sources as shall be selected in good
faith by the Committee; provided, however, that the determination of Fair Market Value shall be made by the Committee in good faith in accordance with the Internal Revenue Code of 1986 (as amended).
If, as the case may be, the particular date for which Fair Market Value need be established under the Plan is not a trading day, the determination shall be made as of the next preceding trading day.
As used
herein, the term "trading day" shall mean a day on which public trading of securities occurs and is reported in the principal consolidated reporting system referred to above, or if the Common Stock is
not listed or admitted to trading on a national securities exchange or included for quotation on the Nasdaq Stock Market, any day other than a Saturday, a Sunday or a day on which banking institutions
in the State of New York are closed. 

        (l)    "Interest Credits" shall mean those amounts credited to the Participant's Account pursuant to Sections 6(f) and 7(b). 

        (m)  "Participant" shall mean a Director of any Corporation who elects to participate in the Plan as provided in
Section 5. 

        (n)   "Phantom Stock Credits" shall mean those amounts credited to the Participant's Account pursuant to Section 6(c),
where each such Phantom Stock Credit is equivalent to the Fair Market Value of one share of Common Stock, but the crediting of which does not transfer any of the attributes of ownership of a share of
Common Stock to the Participant. 

2

 

        (o)   "Plan" shall mean the Mercantile Bankshares Corporation And Participating Affiliates Unfunded Deferred Compensation Plan
For Directors, as described herein and as amended from time to time. 

        (p)   "Sponsor" shall mean Mercantile Bankshares Corporation, a Maryland corporation. 

        (q)   "Valuation Date" shall mean the last business day of March, June, September and December. 

3.     Administration  

        The Plan shall be administered by the Board of Directors of the Sponsor. In the alternative, the Board of Directors of the Sponsor may appoint a Committee that is
composed solely of two or more Non-Employee Directors, as that term is defined in Rule 16b-3(b)(3)(i) promulgated under the Securities Exchange Act of 1934, as
amended, to administer the Plan on behalf of the Board of Directors of the Sponsor, subject to such terms and conditions as the Board of Directors of the Sponsor may prescribe. The Committee shall
have the
authority, in its sole and absolute discretion, to interpret the Plan and adopt, amend, or rescind such rules and procedures for carrying out the Plan, and to take all other action necessary or
advisable for the implementation and administration of the Plan, as the Committee may deem appropriate. Once appointed, the Committee shall continue to serve until otherwise directed by the Board of
Directors of the Sponsor. From time to time, the Board of Directors of the Sponsor may increase the size of the Committee and appoint additional members thereof, remove members (with or without cause)
and appoint new members in substitution therefor, fill vacancies, however caused, and remove all members of the Committee and, thereafter, directly administer the Plan. In the event that the Board of
Directors of the Sponsor is the administrator of the Plan in lieu of a Committee, the term "Committee" as used herein shall be deemed to mean the Board of Directors of the Sponsor. 

4.     Eligibility  

        Eligibility for participation in the Plan shall be available to all Directors who are not officers of the Sponsor or any Affiliate; provided, however, that
Directors of an Affiliate that is not a participating Affiliate as of March 9, 2004, shall not be eligible until the later of the date the Plan is adopted by the Affiliate's Board of Directors
or the date such adoption is approved by the Chairman of the Board of Directors or the President of the Sponsor. In no event shall an Affiliate's adoption of the Plan take effect retroactively. 

5.     Participant Elections  

        (a)    Election to Participate.    

        (i)    Any
Director who first becomes eligible as a result of being newly elected as a Director or as a result of the Affiliate for which the Director performs services as a
Director first adopting the Plan may elect to become an active Participant during the calendar year in which such Director first becomes eligible by filing a Deferral Agreement to that effect with the
Committee within thirty (30) days after first becoming eligible. Such Director shall become an active Participant in the Plan effective as of the date the Deferral Agreement is received by the
Committee or, if later, as of the date the Affiliate's adoption of the Plan is effective. If a Deferral Agreement is not received by the Committee within such thirty (30) -day
period, the Director may only elect to become an active Participant as of January 1 of the subsequent calendar year or January 1 of any later calendar year and shall make such election
by filing a Deferral Agreement to that effect with the Committee by December 31 of the calendar year immediately preceding the calendar year during which he or she desires to commence active
participation. 

3

 

        (ii)   Unless
otherwise withdrawn by the Participant, active participation in the Plan shall continue as to any Participant until that person ceases to be an eligible
Director. A Participant who withdraws his active participation in the Plan or who ceases to be an eligible Director shall, nevertheless, remain an inactive Participant hereunder and shall remain bound
by all applicable provisions of the Plan until such time as his Account shall be fully distributed. 

        (b)    Deferral Agreements.    

        (i)    Each
eligible Director shall become a Participant in the Plan as of the dates specified in Section 5(a) by filing a Deferral Agreement with the Committee in
accordance with the provisions of Section 5(a). 

        (ii)   Each
such Deferral Agreement shall specify the percentage of compensation payable to the Director, the receipt of which the Director elects to defer pursuant to the
Plan. 

        (iii)  All
Deferral Agreements shall be effective prospectively and only with respect to amounts earned by the eligible Director subsequent to the date each such Deferral
Agreement is received by the Committee. 

        (iv)  A
Deferral Agreement shall remain in effect with respect to compensation earned by the Director in subsequent years until a revised Deferral Agreement is filed with the
Committee that modifies any elections in effect under the current Deferral Agreement on file with the Committee or until the Director's active participation in the Plan is otherwise terminated. Any
such modifications to current elections shall be effective as of January 1 of the calendar year immediately following the year in which the revised Deferral Agreement is received by the
Committee; provided, however, that a Director may
terminate at any time during a calendar year the election to defer the receipt of compensation not yet earned by the Director by notifying the Committee in writing, in which event the election to
defer shall terminate effective upon receipt of such notification of termination. An election to defer all or any part of a Director's annual retainer fee shall be irrevocable with respect to the
calendar year to which such deferral election applies. 

        (c)    Termination or Withdrawal of Participation.    A Director's termination of active participation or termination
of election to defer shall not cause acceleration or modification of the periodic method of payment elected by the Director pursuant to Section 7 with respect to the balance of the Director's
Account accrued as of the effective date of such termination (or with respect to any Interest Credits or dividend equivalent Phantom Stock Credits credited to such Account thereafter and before the
entire balance of such Account has been distributed). 

6.     Deferred Compensation Accounts  

        (a)    Accounts, In General.    After the effective date of any election to participate properly filed with the
Committee by a Director, the Corporation for which the Participant serves as a Director shall establish an Account on its books in the name of the Director, which Account shall be credited or debited,
as the case may be, with Deferred Compensation, Phantom Stock Credits, and/or Interest Credits as described below, and payments pursuant to Section 7. Each such Account shall consist of such
subaccounts as are necessary or desirable to the Committee for the convenient administration of the Plan. The Account and any subaccounts established thereunder shall be bookkeeping reserve accounts
only and shall not require segregation of any funds of the Sponsor or an Affiliate or provide any Participant with any rights to any assets of the Sponsor or an Affiliate, except, to the extent
applicable, as a general creditor thereof. Neither a Participant nor a Participant's Beneficiary shall have any right to receive payment of any amount credited to the Participant's Account except as
expressly provided in Section 7. 

4

 

        (b)    Vesting.    Each Participant shall be at all times fully vested in and have a nonforfeitable right to the
aggregate amount credited to the Participant's Account. 

        (c)    Deferred Compensation and Phantom Stock Credits.    

        (i)    Except
as provided in Sections 6(f) and 7(b), all Deferred Compensation deferred by a Participant on and after January 1, 1996, shall be credited to the
Participant's Account as of the applicable Valuation Date in the form of Phantom Stock Credits. 

        (ii)   The
number of such Phantom Stock Credits to be credited to each Participant's Account as of any Valuation Date shall be determined by dividing (A) the aggregate
dollar amount of Deferred Compensation that otherwise would have been payable to the Participant during the calendar quarter ending on such Valuation Date absent the Participant's election to defer
such amount pursuant to the Plan, by (B) the Fair Market Value of one share of Common Stock on such Valuation Date. Phantom Stock Credits shall be added to the Phantom Stock Credits previously
credited to the Participant's Account and may be credited to such Account in whole or fractional units as applicable. 

        (d)    Dividend Equivalents.    As of each Valuation Date, each Participant's Account that has a balance of Phantom
Stock Credits shall be credited with dividend equivalent Phantom Stock Credits determined by dividing (i) the aggregate dividends that the Participant would have received during the calendar
quarter ending on such Valuation Date if the Participant were the owner of record throughout such calendar quarter of a number of whole shares of Common Stock equal to the number of whole Phantom
Stock Credits credited to such Participant's Account as of such Valuation Date (but prior to the crediting of any Deferred Compensation on such Valuation Date), by (ii) the Fair Market Value of
one share of Common Stock on such Valuation Date. Dividend equivalent Phantom Stock Credits shall be added to the Phantom Stock Credits previously credited to the Participant's Account and may be
credited to such Account in whole or fractional units as applicable. 

        (e)    Phantom Stock Credit Adjustments.    The Committee shall adjust the Phantom Stock Credits credited to each
Participant's Account as appropriate to reflect any stock dividend, stock split, combination of shares, merger, share exchange, consolidation or any other change in the corporate structure or shares
of the Sponsor. 

        (f)    Deferred Compensation and Interest Credits.    Prior to becoming active Participants in the Plan, certain
Directors participated in predecessor deferred compensation plans of various Affiliates. Deferred compensation was credited to those Directors' accounts under such predecessor plans. Those accounts
have been transferred to this Plan and form subaccounts of such Directors' Accounts under this Plan. These subaccounts have not been converted to Phantom Stock Credits but remain denominated in
dollars. The dollar amount in each such subaccount shall be credited with Interest Credits as of each Valuation Date, until the entire balance of the subaccount has been distributed under the Plan, at
the annual rate of five percent (5%). The amount of Interest Credits to be credited to a Participant's subaccount on any Valuation Date shall be based on the balance in the Participant's subaccount as
of the immediately preceding Valuation Date and shall take into account any distributions made from the subaccount since such immediately preceding Valuation Date. Notwithstanding Section 7(a),
distribution of these subaccounts shall be made in cash. 

7.     Distributions of Deferred Compensation Accounts  

        (a)   Except
as provided in Sections 6(f) and 7(b), Phantom Stock Credits may be redeemed only for whole shares of Common Stock in accordance with the provisions of the Plan.
No fractional shares of Common Stock shall be distributable under the Plan. 

5

 

        (b)   Notwithstanding
Section 7(a), the Account of any prior Director, which Account was converted into dollars at such time as such prior Director ceased to be a
Director, shall be distributed in cash rather than Common Stock. Notwithstanding Section 7(a), any current Director who has a balance in his or her Account as of March 9, 2004, may elect
to have distributions of such Account payable in cash rather than Common Stock. Such election shall apply only to the portion of the Participant's Account attributable to fees deferred (including
dividend equivalent Phantom Stock Credits) prior to April 1, 2004. To make this one-time election, the Director must submit to the Committee, by May 31, 2004, a written
election form, substantially in the form attached hereto as Exhibit B, executed by the Participant. The Committee or the full Board of Directors shall, promptly after May 31, 2004, and
prior to the allocation of Interest Credits or Phantom Stock Credits to such Directors' Accounts, approve each such Director's election to receive cash distributions or to receive distributions
payable in shares of Common Stock in lieu of electing to receive cash distributions. If a Participant makes this election (or in the case of a prior Director whose Account was converted into dollars
as described in the first sentence of this Section 7(b)), then Interest Credits rather than Phantom Stock Credits shall be allocated to his or her Account when he or she ceases to be a Director
as follows: As of the Valuation Date coincident with or immediately following the date a Participant ceases to be a Director, the dollar amount of a Participant's Account shall be fixed by multiplying
(i) the number of Phantom Stock Credits (including fractional units) in the Participant's Account on such Valuation Date, after taking into account all Deferred Compensation or dividend
equivalent Phantom Stock Credits allocable to the Account on such Valuation Date, by (ii) the Fair Market Value of one share of Common Stock on such Valuation Date. As of each succeeding
Valuation Date thereafter, the dollar amount credited to the Participant's Account shall be credited with Interest Credits, until the entire balance of the Account has been distributed under the Plan,
at the annual rate of five percent (5%). The amount of Interest Credits to be credited to a Participant's Account on any Valuation Date shall be based on the balance in the Participant's Account as of
the immediately preceding Valuation Date and shall take into account any distributions made from the Account since such immediately preceding Valuation Date. See Exhibit C attached hereto for a
further description of the methodology for Account conversion and the crediting of Interest Credits. 

        (c)   Each
Participant shall elect, no later than December 31 of the calendar year in which he or she ceases to be a Director, the method of payment of distributions of
the Participant's Account; such election shall be irrevocable and in writing, substantially in the form attached hereto as Exhibit D, executed by the Participant. The Committee or the full
Board of Directors shall approve each Participant's election and distribution of his Account prior to the first of any distributions from his Account. A Participant may elect to receive distributions
in a number of substantially equal annual or quarterly installments (which shall include Interest Credits or dividend equivalent Phantom Stock Credits, as applicable, not to exceed ten (10) if
the installment payments are to be made annually, and not to exceed forty (40) if the installment payments are to be made quarterly. The first installment payment (whether annual or quarterly)
shall, except as provided in the immediately succeeding sentence hereof, be made during the first calendar quarter of the calendar year immediately following the calendar year in which the Participant
ceases to be a Director, and shall be based on the value of the Participant's Account as of the Valuation Date occurring in the last calendar quarter of the calendar year in which the Participant
ceases to be a Director. Notwithstanding the immediately preceding sentence hereof, if a Participant elects, at any time prior to January 1 of the calendar year in which he or she ceases to be
a Director, to receive distributions in quarterly installments, the first installment payment shall be made during the first calendar quarter immediately following the calendar quarter in which the
Participant ceases to be a Director, and shall be based on the value of the Participant's Account as of the Valuation Date occurring in the calendar quarter in which the Participant ceases to be a
Director. Amounts held for installment payments shall continue to be credited with Interest Credits or dividend equivalent 

6

 

Phantom
Stock Credits, as applicable. Subsequent installments shall be made during each succeeding calendar quarter, if installment payments are to be made quarterly, or during the first calendar
quarter of each succeeding calendar year, if installment payments are to be made annually, until the entire balance of such Participant's Account due to that Participant has been paid. All
distributions shall be based on the value of or the number of Phantom Stock Credits allocated to the Participant's Account as of the Valuation Date immediately preceding such distribution. 

        (d)   Notwithstanding
Section 7(c) above, any election by a Participant as to the method of payment of Deferred Compensation, which election was made prior to
March 12, 1996, shall remain valid and irrevocable with respect to compensation which was deferred by the Participant prior to March 12, 1996. 

        (e)   The
Committee shall in all events make a single lump sum payment, notwithstanding the periodic method elected by the Participant, if the balance of the Participant's
Account at the time of commencement of benefits is less than Ten Thousand Dollars ($10,000). All distributions shall be based on the value of the Participant's Account as of the Valuation Date
immediately preceding such distribution. 

        (f)    In
the event a Participant ceases to be a Director and becomes employed by any governmental agency that has jurisdiction over the activities of the Sponsor or an
Affiliate (all as determined by the Committee), the entire unpaid balance of all of such Participant's Account shall be paid immediately, in a single lump sum payment, without regard to the timing of
distributions elected pursuant to
Section 7(c). All distributions shall be based on the value of the Participant's Account as of the Valuation Date immediately preceding such distribution. 

        (g)   If
a Participant dies before full payment is made of such Participant's Account, the unpaid balance of such Account shall be paid to the surviving Beneficiary designated
in writing by the Participant, on a designation election substantially in the form attached hereto as Exhibit E, and delivered to the Committee under the same method of payment which applied or
would have applied in the case of payments to the Participant; however, in the event of financial hardship as described at Section 17, or in the event that the balance of the Account at that
time is less than Ten Thousand Dollars ($10,000), such unpaid installments shall be paid in one lump sum payment to the designated Beneficiary. The filing of a designation of Beneficiary shall be
deemed automatically to revoke any previously filed Beneficiary designation. If (i) no designation shall be in effect, or (ii) no designated Beneficiary survives the Participant, or
(iii) the designated Beneficiary is the Participant's estate, then the unpaid balance at the Participant's death shall be paid to the estate of the Participant in one lump sum payment. Payment
to the Participant's estate or Beneficiary shall be made or begin during the calendar quarter immediately following the calendar quarter in which the Participant dies. In the case of a Beneficiary who
dies while receiving installment payments, any installments payable after the Beneficiary's death shall be paid to the deceased Beneficiary's estate; however, in the event of financial hardship as
described at Section 17, or in the event that the balance of the Account at that time is less than Ten Thousand Dollars ($10,000), such unpaid installment payments shall be paid in one lump sum
payment to the deceased Beneficiary's estate. All Beneficiaries similarly situated shall be treated alike. All distributions shall be based on the value of the Participant's (or Beneficiary's) Account
as of the Valuation Date immediately preceding such distribution.

        (h)   Notwithstanding
anything herein contained to the contrary, the Committee shall have the right, in its sole discretion, to vary the method and timing of distributions to
a Participant or Beneficiary under this Section 7, after such Participant ceases to be a Director, and may make such distributions in a single payment or over a shorter or longer period of time
than that elected by the Participant 

7

 

8.     Assignment and Payments Upon Incapacity  

        (a)   No
right of any Participant or Beneficiary in the Plan to receipt of a Participant's Account shall be assignable or subject to anticipation, encumbrance, sale, pledge,
alienation, execution, levy, attachment, charge or any other form of transfer or encumbrance of any nature whatsoever except that a Participant may name a Beneficiary in respect of the rights of the
Participant in the event of such Participant's death. Upon the occurrence of any event deemed by the Corporation to be in violation, attempted violation or to evidence any danger of violation of the
prohibition on transfers and
encumbrances described in this Section 8(a), all as determined by the Committee, the Corporation may withhold any and all payments under the Plan and make such payments to anyone else deemed by
the Corporation to be a natural object of the bounty of the Participant or Beneficiary to whom such withheld payments would otherwise have been made. 

        (b)   If
the Committee shall find that any person to whom any payment is payable under the Plan is unable to care for his or her affairs because of illness or accident, or is
a minor, any payment due (unless a prior claim therefor shall have been made by a duly appointed guardian, committee, or other legal representative) may be paid to the spouse, a child, a parent, or a
brother or sister, or to any person deemed by the Committee to have incurred expense for such person otherwise entitled to payment, in such manner and proportions as the Committee may determine. Any
such payment shall be a complete discharge of the liabilities of the Corporation to make such payment to the Participant. 

9.     Amendment or Discontinuance of Plan  

        (a)   Except
as provided in Section 9(d), the Board of Directors of the Sponsor shall be vested with the sole power to amend the Plan, subject to applicable law and
stock exchange requirements, at any time and in any manner (whether in toto or with respect to an individual Participant) in such respects as the Board
of Directors of the Sponsor may deem advisable by an instrument in writing, which amendment shall be binding on all parties, subject to the principles contained in Section 9(c). Notice of any
such amendment shall be provided to all Participants and to each Corporation promptly. 

        (b)   The
Board of Directors of any Corporation may, by resolution adopted by a majority of the members of the Board of Directors at a meeting at which a quorum is present,
discontinue its participation in the Plan. Notice of such discontinuance shall be provided to the Committee and each affected Participant promptly. 

        (c)   Notwithstanding
the foregoing, but subject to Section 9(d), no amendment or discontinuance of the Plan shall affect Participants' rights to receive distributions
of their Accounts attributable to fees deferred (including dividend equivalent Phantom Stock Credits and Interest Credits, as applicable) prior to the effective date of such amendment or
discontinuance. 

        (d)   The
Board of Directors of the Sponsor reserves the right to terminate its sponsorship of the Plan, by resolution adopted by a majority of its entire Board of Directors,
provided that at least thirty (30) days advance written notice is provided to each other Corporation. In the event of such termination, any Corporation, by resolution of a majority of its Board
of Directors, may elect to continue the Plan as an individual Plan for the benefit of such Corporation's participating Directors, provided that such Corporation shall assume full responsibility for
administration of the Plan thereafter. 

10.   Plan Not Funded  

        (a)   The
Plan is not funded. The Corporation shall not be required to reserve, or otherwise set aside, physically or legally, any funds for the payment of its obligations
hereunder. The 

8

 

obligations
of each Corporation with respect to the benefits payable hereunder shall be paid out of such Corporation's general assets and shall not be secured by any form of trust, escrow, evidence of
indebtedness or otherwise. No person having rights under the Plan shall be deemed to have any property interest, legal or equitable, in any specific asset of the Corporation or any Common Stock of the
Sponsor, and, to the extent that any person acquires any right to receive payments under the Plan, such right shall be no greater than, nor shall it have preference or priority over, the rights of any
unsecured general creditor of the Corporation. 

        (b)   A
Corporation shall have the right, but shall not be required, to segregate funds in its financial records equal to the aggregate Accounts of its Directors, and to
invest such funds or to direct the investment of such funds in order to produce an income return, but such funds and the earnings thereon shall remain solely as an asset of the Corporation. 

11.   Copies of Plan Available  

        Copies of the Plan and any and all amendments thereto shall be made available to all members of the Board of Directors and Participants during normal business
hours at the office of the Secretary of the Sponsor. 

12.   Separate Application of Plan  

        The Plan embodies the terms and conditions of the individual unfunded deferred compensation plans of the Sponsor and participating Affiliates, for the benefit of
their respective Directors, all of which plans shall be governed by this instrument and collectively referred to for convenience as the "Plan." Except as expressly provided in the Plan, it is intended
that the provisions of the Plan shall apply
separately to each Corporation and to the Participants of each such Corporation, and the term "Corporation" as used throughout the Plan shall be so construed. Payment of a Participant's Account under
the Plan shall be the sole liability and obligation of the Corporation for which the Participant served as a Director during the respective period(s) of his or her participation in the Plan, and not
the liability or obligation of any other Corporation. The Affiliates participating in the Plan as of March 9, 2004, are listed on Exhibit F attached hereto. 

13.   Common Directors  

        In the event that a Director serves on the Board of Directors of more than one Corporation, the Director must execute a separate election form as to each
Corporation for which the Director desires to have Deferred Compensation. 

14.   Binding on Successors  

        In the event that the Corporation (or any entity resulting from any merger or consolidation referred to in this Section 14 or which shall be a purchaser or
transferee so referred to) shall at any time be merged or consolidated into or with any other entity or entities or in the event that substantially all of the assets of the Corporation or any such
entity shall be sold or otherwise transferred to another entity, the provisions of the Plan shall be binding upon and shall inure to the benefit of the continuing entity in (or the entity resulting
from) such merger or consolidation or the entity to which such assets shall be sold or transferred. Except as provided in the preceding sentence, the Plan shall not be assignable by a Corporation or
by any entity referred to in this Section 14. The obligations and rights of a Participant under the Plan shall not be assignable, but, in the event of the Participant's death, such obligations
and rights shall be binding upon and inure to the benefit of such Participant's heirs, executors or administrators. 

9

 

15.   Continuation as Director  

        The Plan or the payment of any benefits hereunder shall not be construed as giving to any Director any right to be retained as a member of the Board of Directors
of any Corporation. 

16.   Participation by Members of Committee  

        No member of the Committee shall be precluded from becoming a Participant in the Plan; however, such member shall not be entitled to vote or act upon matters, or
sign any documents, relating specifically to such member's own participation under the Plan, except when such matters or documents relate to benefits and administrative matters generally. If this
disqualification results in the lack of a quorum, then the Sponsor's Board of Directors shall appoint a sufficient number of temporary members of the Committee who shall serve for the sole purpose of
determining such a question. 

17.   Hardship Withdrawals  

        For serious financial reasons beyond the Participant's control, and which would cause the Participant great hardship if early withdrawal were not permitted, such
Participant may apply to the Committee for withdrawals from the Plan prior to termination of the Participant's service as a Director of the Corporation; provided, however, that no early withdrawals
shall be permitted with respect to any Participant while such Participant is a Director of the Sponsor. If such application for withdrawal is approved by the Committee, the withdrawal will be
effective at the later of the dates specified in the Participant's application or the date of approval by the Committee. The Committee shall direct the Corporation to pay such amount attributable to
the balance in such Participant's Account (determined as of the Valuation Date immediately preceding such distribution) up to the amount necessary to meet the financial emergency. Following
withdrawal, the Participant's election to defer shall be terminated and no new election to defer shall be accepted or approved by the Committee for a period of no less than six (6) months
following the date of withdrawal. Serious financial reasons may include the following: unexpected and unreimbursed expenses of a major or emergency nature where withdrawal of the funds would be
necessary to prevent great hardship to the Participant. 

18.   Claims Procedure  

        Any claim for benefits or payments under the Plan by Participants or Beneficiaries shall be made in writing and delivered to the Committee at the principal office
of the Sponsor. If the Participant or Beneficiary believes he or she has been denied any benefits or payments under the Plan, either in total or in an amount less than the full benefit or payment the
claimant would normally be entitled to receive, the Committee shall advise the claimant in writing of the amount of the benefit, or payment; if any, and the specific reasons for the denial. The
Committee shall also furnish the claimant at that time with a written notice containing: 

        (a)   A
specific reference to pertinent provisions of the Plan. 

        (b)   A
description of any additional material or information necessary for the claimant to perfect this claim, if possible, and an explanation of why such material or
information is needed. 

        (c)   An
explanation of the following claim review procedure. 

        Within
sixty (60) days of receipt of the information described above, the claimant shall, if further review is desired, file a written request for reconsideration with the
Committee. So long as the claimant's request for review is pending (including such sixty (60) day period), the claimant or his or her duly authorized representative may review pertinent
documents and may submit issues and comments in writing to the Committee. 

10

 

        A
final and binding decision shall be made by the Committee within sixty (60) days of the filing by the claimant of the request for reconsideration; provided, however, that if the
Committee, in its discretion, feels that a hearing with the claimant or his or her representative present is necessary or desirable, this period shall be extended an additional sixty (60) days. 

        The
decision by the Committee shall be conveyed to the claimant in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the
claimant, with specific references to the pertinent provisions of the Plan on which the decision is based. 

        The
Committee shall use ordinary care and diligence in the performance of its duties. The Committee shall be entitled to rely conclusively, and shall be fully protected in any action or
omission taken by it in good faith reliance, upon the advice or opinions of any persons, firms or agents retained by it, including, but not limited to, accountants, actuaries, counsel and other
specialists. Nothing contained herein shall preclude any Corporation from indemnifying any member of the Committee for all actions under the Plan, or from purchasing liability insurance to protect
such persons serving thereon with respect to their duties pursuant to the Plan. 

19.   Governing Law  

        Except to the extent preempted by applicable Federal laws, the Plan shall be construed according to the laws of the State of Maryland, other than its conflict of
laws principles, and so as to comply with any applicable securities exchange rules or regulations. 

11

 

        IN WITNESS WHEREOF, the duly authorized officers of Mercantile Bankshares Corporation have signed and sealed this amended and restated
Plan on behalf of Mercantile Bankshares Corporation as of the 9th day of March, 2004. 

	
ATTEST:	
 	

MERCANTILE BANKSHARES

CORPORATION
	

    	
 	

 
	

	
 	

	Secretary	 	President
	[SEAL]	 	 

12

EXHIBIT A  

 DIRECTOR'S DEFERRAL AGREEMENT  

	To:
	The Administrative Committee of the Mercantile Bankshares Corporation And Participating Affiliates Unfunded Deferred Compensation Plan For Directors  

        I, the undersigned, a Director of                        (the
"Corporation") hereby acknowledge receipt of a copy of the Mercantile Bankshares Corporation and
Participating Affiliates Unfunded Deferred Compensation Plan for Directors (the "Plan"), and further acknowledge that my election to participate in the Plan contained herein shall be subject in all
respects to the provisions of the Plan, as amended from time to time. 

ELECTION OF DEFERRED COMPENSATION  

        Pursuant to the terms of the Plan, I hereby elect to defer receipt of the percentage of each future payment of fees, as designated below, effective prospectively
as of the applicable date determined in accordance with the provisions of Section 5 of the Plan based upon the date this Deferral Agreement is filed with the Committee. Different percentages
may be elected for Meeting Fees and the Annual Retainer: 

	

        %	
 	

Board of Directors Meeting Fees
	

        %	
 	

Board of Directors Committee Meeting Fees
	

        %	
 	

Annual Retainer

        Such
election shall continue to be effective in accordance with the provisions of Section 5 of the Plan until a revised Deferral Agreement becomes effective or until I
file a written notice of termination of this deferral election with the Committee, unless I become ineligible at an earlier date under the terms of the Plan. I understand that my election to
defer all or any portion of my annual retainer fee shall be irrevocable with respect to the calendar year to which such deferral election applies. 

        In
any event, my election to defer payment of compensation shall be applicable only with respect to amounts earned subsequent to the date this written notice of my election is received
by the Committee. 

	
WITNESS:	
 	

DIRECTOR
	

    	

 	
 	

 
	
	 	
 (Signature)
	

Date:	

 	
 	

 
	 	
	 	 
	
RECEIVED:	
 	

 
	

Date:	

 	
 	

 
	 	
	 	

	 	 	 	By:

EXHIBIT B  

 ELECTION TO RECEIVE PRE-APRIL 1, 2004 DEFERRALS IN CASH  

	To:
	The Administrative Committee of the Mercantile Bankshares Corporation And Participating Affiliates Unfunded Deferred Compensation Plan For Directors  

        I, the undersigned, a Director of                        (the
"Corporation"), hereby acknowledge receipt of a copy of the Mercantile Bankshares Corporation and
Participating Affiliates Unfunded Deferred Compensation Plan for Directors, as amended and restated effective March 9, 2004 (the "Plan"), and further acknowledge that my elections pursuant to
participation in the Plan as contained herein shall be subject in all respects to the provisions of the Plan, as amended from time to time. 

        I
understand that I have the one-time right, pursuant to Section 7(b) of the Plan, to have the portion of my Account attributable to fees deferred (including dividend
equivalent Phantom Stock Credits) prior to April 1, 2004, payable in cash rather than Common Stock. I further understand that as of the Valuation Date coincident with or immediately following
the date on which I cease to be a Director, this pre-April 1, 2004 balance will be credited with Interest Credits as described in Section 7(b) of the Plan rather than with
dividend equivalent Phantom Stock Credits until my Account is fully distributed. Accordingly, 

        o I
do                o I do not 

choose to make this one-time irrevocable election as described above. 

	
WITNESS:	
 	

DIRECTOR
	

    	

 	
 	

 
	
	 	
 (Signature)
	

Date:	

 	
 	

 
	 	
	 	 
	
RECEIVED:	
 	

 
	

Date:	

 	
 	

 
	 	
	 	

	 	 	 	By:

EXHIBIT C  

 METHODOLOGY FOR CONVERSION OF ACCOUNT TO DOLLARS, CREDITING INTEREST CREDITS AND INSTALLMENT PAYMENT CALCULATIONS  

        Assume a Participant ceases to be a Director on December 15. On the immediately following Valuation Date, the following facts exist: 

	1.
	The
Account consists of 94.3 Phantom Stock Credits.

	2.
	Deferred
Compensation and dividend equivalent Phantom Stock Credits are due to be allocated and will produce an additional 2.2 Phantom Stock Credits.

	3.
	The
Fair Market Value of one (1) share of Common Stock on the Valuation Date is $52.87.

	4.
	Quarterly
installments will commence three (3) days following the Valuation Date.

	5.
	The
Participant has elected to receive forty (40) payments. 

        The
procedure for commencing and continuing payments shall be as follows: 

	1.
	The
amounts in #1 and #2 shall be added to produce a sum of 96.5 Phantom Stock Credits.

	2.
	The
sum of 96.5 Phantom Stock Credits will be multiplied by $52.87 to produce a product of $5,101.96. This will become the initial fixed dollar value of the Participant's Account.

	3.
	Three
(3) days after the Valuation Date, the first payment is due the Participant. The amount of the payment will be based on the immediately preceding Valuation Date and will
be one-fortieth (1/40) of $5,101.96, or $127.55.

	4.
	As
of the next Valuation Date, Interest Credits must be credited. The Interest Credits will be based on the value of the Participant's Account as of the immediately preceding Valuation
Date ($5,101.96), but minus the distribution made ($127.55) since such Valuation Date. Interest Credits will, therefore, be based on a dollar balance of $4,974.41. One and one-quarter
percent (11/4%) (i.e., one-fourth (1/4) of five percent (5%)) of $4,974.41 is $62.18. After crediting Interest Credits, the new balance in the Account is
$5,036.59.

	5.
	Shortly
after the Valuation Date, another payment will be due the Participant. The amount of the payment will be based on the immediately preceding Valuation Date and will be
one-thirty-ninth (1/39) of $5,036.59, or $129.14. 

        Interest
Credits are credited and payments are made in this fashion, reducing the denominator of the applicable fraction by one (1) on each subsequent Valuation Date, until the
Account has been completely distributed. 

 
 

EXHIBIT D    
    
    DESIGNATION OF METHOD OF PAYMENT    
    

	To:
	The Administrative Committee of the Mercantile Bankshares Corporation And Participating Affiliates Unfunded Deferred Compensation Plan For Directors  

        I, the undersigned, a Director of                        (the
"Corporation") hereby acknowledge receipt of a copy of the Mercantile Bankshares Corporation and
Participating Affiliates Unfunded Deferred Compensation Plan for Directors (the "Plan"), and further acknowledge that my elections pursuant to participation in the Plan as contained herein shall be
subject in all respects to the provisions of the Plan, as amended from time to time. 

        I
elect hereby that all amounts deferred under the Plan, together with Interest Credits and/or dividend equivalent Phantom Stock Credits, as applicable, credited thereon, shall be
distributed to me (check appropriate form of payment): 

	

 	
 	

 
	            	 	In substantially equal annual installments (which shall include Interest Credits and/or dividend equivalent Phantom Stock Credits) for            years (specify
number not exceeding 10).
	

OR
	

            	
 	

In substantially equal quarterly installments (which shall include Interest Credits and/or dividend equivalent Phantom Stock Credits)
for                        quarters (specify number not exceeding 40).

        I acknowledge and agree that this designation shall not be effective and distributions shall not be paid until this designation is approved by the Board of
Directors or the Committee, as defined in the Plan.

        The
first installment (if I have so elected) shall be paid during the first calendar quarter of the calendar year immediately following the year in which I cease to be a Director (unless
I have made my distribution election prior to January 1 of the calendar year in which I cease to be a Director, in which case the first installment shall be paid during the first calendar
quarter immediately following the calendar quarter in which I cease to be a Director), and subsequent installments shall be paid during the first calendar quarter of each succeeding calendar year (if
I have elected annual installments) or during each succeeding calendar quarter (if I have elected quarterly installments) until the entire amount credited to my Account shall have been paid. 

        I
understand that any distribution elections made prior to March 12, 1996, remain valid and irrevocable with regard to any compensation deferred pursuant to such elections. I
understand that the election made above is irrevocable and applicable to any compensation deferred on and after March 12, 1996. 

	
WITNESS:	
 	

DIRECTOR
	

    	

 	
 	

 
	
	 	
 (Signature)
	

Date:	

 	
 	

 
	 	
	 	 
	
RECEIVED:	
 	

 
	

Date:	

 	
 	

 
	 	
	 	

	 	 	 	By:

EXHIBIT E  

 DESIGNATION OF BENEFICIARY

	To:
	The Administrative Committee of the Mercantile Bankshares Corporation And Participating Affiliates Unfunded Deferred Compensation Plan For Directors  

        I hereby designate the following person(s) as my primary Beneficiary(ies) under the Mercantile Bankshares Corporation And Participating Affiliates Unfunded
Deferred Compensation Plan For Directors to receive any amounts that may become payable thereunder on account of or after my death (in the percentages set forth following their names) in accordance
with Section 7(g) of the Plan: 

(give
name(s), address(es), relationship(s), social security number(s), and, if applicable, percentage of interest). 

        If,
upon my death, no primary Beneficiary is living, such amount shall be paid to the following person(s) as my contingent Beneficiary(ies). 

	
WITNESS:	
 	

DIRECTOR
	

    	

 	
 	

 
	
	 	
 (Signature)
	

Date:	

 	
 	

 
	 	
	 	 
	
RECEIVED:	
 	

 
	

Date:	

 	
 	

 
	 	
	 	

	 	 	 	By:

EXHIBIT F  

 AFFILIATES OF MERCANTILE BANKSHARES CORPORATION

THAT HAVE ADOPTED THE PLAN  

The
Annapolis Banking and Trust Company 

Baltimore
Trust Company 

Bank
of Southern Maryland 

Calvert
Bank & Trust Company 

The
Chestertown Bank of Maryland 

The
Citizens National Bank 

County
Banking and Trust Company 

Farmers &
Mechanics Bank 

Farmers
and Merchants Bank—Eastern Shore 

The
Fidelity Bank 

The
First National Bank of St. Mary's 

The
Forest Hill State Bank 

Marshall
National Bank and Trust Company 

Mercantile
Mortgage Corporation 

Mercantile-Safe
Deposit and Trust Company 

The
National Bank of Fredericksburg 

Peninsula
Bank 

The
Peoples Bank of Maryland 

Potomac
Valley Bank 

St.
Michael's Bank 

Westminster
Union Bank 

Effective as of March 9, 2004

QuickLinks

MERCANTILE BANKSHARES CORPORATION AND PARTICIPATING AFFILIATES UNFUNDED DEFERRED COMPENSATION PLAN FOR DIRECTORS

EXHIBIT D DESIGNATION OF METHOD OF PAYMENT

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