Document:

Exhibit

Exhibit -4.65

	
	
	Third Supplemental Agreement to Secured Loan Facility Agreement dated 22 December 2015 as amended and supplemented by a First Supplemental Agreement dated 6 April 2016 and a Second Supplemental Agreement dated 2 June 2016 

	Dated December 30, 2016

	(1)  SBI Achilles Shipping Company Limited
      SBI Hermes Shipping Company Limited
      (as Borrowers)
(2)  Scorpio Bulkers Inc.
       (as Guarantor)
(3)  The Financial Institutions
       listed in Schedule 1
       (as Original Lenders)
(4)   ABN AMRO Bank N.V.
       (as Arranger)
(5)   ABN AMRO Bank N.V. (as Agent)
(6)   ABN AMRO Bank N.V.
        (as Swap Provider)
(7)    ABN AMRO Bank N.V.
        (as Security Agent)

Exhibit -4.65

 Contents
Page
		
	1
	Interpretation                                            2

		
	2
	Conditions                                            2

		
	3
	Representations                                        3

		
	4
	Amendments to Loan Agreement                                3

		
	5
	Confirmations and Undertakings                                    7

		
	6
	Notices, Governing Law and Enforcement                            7

		
	Schedule 1
	The Lenders                                            8

		
	Schedule 2
	Effective Date Confirmation                                    9

    

Third Supplemental Agreement
Dated       December 30                                        2016

Exhibit -4.65

Between:
		
	(1)
	SBI Achilles Shipping Company Limited ("Borrower A") and SBI Hermes Shipping Company Limited ("Borrower B" and together with Borrower A, the "Borrowers" and each a "Borrower"), each a corporation incorporated under the laws of the Republic of the Marshall Islands, with its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960; and

		
	(2)
	Scorpio Bulkers Inc., a corporation incorporated under the laws of the Republic of the Marshall Islands, with registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960 (the "Guarantor"); and

		
	(3)
	The Financial Institutions listed in Schedule 1 (The Lenders), each acting through its office at the address indicated against its name in Schedule 1(together the "Lenders" and each a "Lender"); and

		
	(4)
	ABN AMRO Bank N.V., acting as mandated lead arranger through its office at Coolsingel 93, 3012 AE Rotterdam, The Netherlands (in that capacity, the "Arranger"); and

		
	(5)
	ABN AMRO Bank N.V., acting as agent through its office at Daalsesingel 71, 3511 SW Utrecht, The Netherlands (in that capacity, the "Agent"); and

		
	(6)
	ABN AMRO Bank N.V., acting as swap provider through its office at Coolsingel 93, 3012 AE Rotterdam, The Netherlands (in that capacity, the "Swap Provider"); and

		
	(7)
	ABN AMRO Bank N.V., acting as security agent through its office at Daalsesingel 71, 3511 SW Utrecht, The Netherlands (in that capacity, the "Security Agent").

Supplemental Agreement to a secured loan agreement dated 22 December 2015 (as amended and supplemented by a first supplemental agreement dated 6 April 2016 and a second supplemental agreement dated 2 June 2016, the "Loan Agreement") made between the Borrowers, the Guarantor, the Lenders, the Agent, the Swap Provider and the Security Agent on the terms and subject to the conditions of which each of the Lenders agreed to advance to the Borrowers its respective Commitment of an aggregate amount not exceeding twenty seven million two hundred fifty thousand Dollars ($27,250,000) to assist the Borrowers to finance part of the aggregate of the purchase price of the Vessels.
Whereas:
		
	(A)
	The Borrowers and the Guarantor have requested that the Finance Parties agree to amend the Repayment Dates and the profile of the Repayment Instalments as set out at clause 6.1  (Repayment of each Tranche) of the Loan Agreement (the "Request").

		
	(B)
	The Finance Parties have agreed to give their consent to the Request, subject to and upon the terms and conditions contained in this Supplemental Agreement. 

It is agreed that:
		
	1
	Interpretation

		
	1.1
	In this Supplemental Agreement:

Exhibit -4.65

		
	1.1.1
	"Effective Date" means the date on which the Agent confirms to the Borrowers in writing substantially in the form set out in Schedule 2 that all of the conditions referred to in Clause 2.1 have been satisfied, which confirmation the Agent shall be under no obligation to give if an Event of Default shall have occurred and is continuing;

		
	1.1.2
	"Finance Parties" means the Agent, the Security Agent, the Swap Provider and the Lenders; and

		
	1.1.3
	"Security Parties" means all parties to this Supplemental Agreement other than the Finance Parties and "Security Party" means any one of them.

		
	1.2
	All words and expressions defined in the Loan Agreement shall have the same meaning when used in this Supplemental Agreement unless the context otherwise requires, and clause 1.2 of the Loan Agreement shall apply to the interpretation of this Supplemental Agreement as if it is set out in full.

		
	1.3
	The Agent and the Borrowers hereby designate this Supplemental Agreement as a Finance Document.

		
	1.4
	All obligations, representations, warranties, covenants and undertakings of the Borrowers under or pursuant to this Supplemental Agreement shall, unless otherwise expressly provided, be entered into, made or given by them jointly and severally.

		
	2
	Conditions

		
	2.1
	As conditions for the agreement of the Finance Parties to the Requests and for the effectiveness of Clause 4, the Borrowers shall deliver or cause to be delivered to or to the order of the Agent the following documents and evidence:

		
	2.1.1
	a certificate from a duly authorised officer of each Borrower and the Guarantor confirming that none of the documents delivered to the Agent pursuant to clauses 4.1 and 4.3 of the Loan Agreement have been amended or modified in any way since the date of their delivery to the Agent, or copies, certified by a duly authorised officer of the Security Party in question as true, complete, accurate and neither amended nor revoked, of any which have been amended or modified;

		
	2.1.2
	a copy, certified by a director or the secretary of the Borrowers and the Guarantor as true, complete and accurate and neither amended nor revoked, of a resolution of the directors of that Security Party (together, where appropriate, with signed waivers of notice of any directors' meetings) approving, and authorising or ratifying the execution of, this Supplemental Agreement and any document to be executed by that Security Party pursuant to this Supplemental Agreement;

		
	2.1.3
	a power of attorney of each of the Borrowers and the Guarantor under which this Supplemental Agreement and any documents required pursuant to it are to be executed by that Security Party; 

		
	2.1.4
	the following legal opinions, each addressed to the Agent or confirmation satisfactory to the Agent that such opinions will be given:

Exhibit -4.65

		
	a.
	a legal opinion of Stephenson Harwood LLP as to matters of  English law; and

		
	b.
	a legal opinion of Seward & Kissel LLP as to matters of Marshall Islands law; 

		
	2.1.5
	evidence that the next Repayment Instalment pursuant to clause 6.1 of the Loan Agreement (as amended pursuant to this Supplemental Agreement), in an amount of:

		
	a.
	$783,332 in respect of Tranche A; and

		
	b.
	$766,668 in respect of Tranche B,

has been paid to the Agent for the account of the Lenders; and
		
	2.1.6
	evidence of payment to the Arranger of an amendment fee of $50,000.

		
	2.2
	All documents and evidence delivered to the Agent pursuant to Clause 2.1 shall:

		
	2.2.1
	be in form and substance acceptable to the Agent;

		
	2.2.2
	be accompanied, if required by the Agent, by translations into the English language, certified in a manner acceptable to the Agent; and

		
	2.2.3
	if required by the Agent, be certified, notarised, legalised or attested in a manner acceptable to the Agent.

		
	3
	Representations

Each of the representations contained in clause 19 of the Loan Agreement shall be deemed repeated by each of the Borrowers and the Guarantor at the date of this Supplemental Agreement and at the Effective Date, by reference to the facts and circumstances then pertaining, as if references to the Finance Documents include this Supplemental Agreement.
		
	4
	Amendments to Loan Agreement

		
	4.1
	With effect from the Effective Date the Loan Agreement shall be read and construed as if:

		
	4.1.1
	references to "this Agreement" are references to the Loan Agreement as amended and

 supplemented by this Supplemental Agreement;

		
	4.1.2
	references to the Finance Documents include this Supplemental Agreement; 

		
	4.1.3
	the following definitions shall be inserted into clause 1.1 (Definitions) of the Loan Agreement:

""Third Supplemental Effective Date" means the Effective Date as defined in the Third Supplemental Agreement."; and
""Third Supplemental Agreement" means the third supplemental agreement to this Agreement entered into by the parties to this Agreement.";

Exhibit -4.65

		
	4.1.4
	clause 6.1 (Repayment of each Tranche) of the Loan Agreement shall be deleted in its entirety and replaced with the following:

		
	"6.1
	Repayment of each Tranche   The Borrowers agree to repay each Tranche to the Agent for the account of the Lenders in the amounts and on the dates as follows:

		
	6.1.1
	in respect of Tranche A:

	
		
	Amount of Repayment Instalment ($)
	Repayment Date

	783,333  
	on or before Third Supplemental  Effective Date

	195,833
	11 October 2020

	195,833
	11 January 2021

	9,400,004
	11 January 2021

; and
		
	6.1.2
	in respect of Tranche B:

	
		
	Amount of Repayment Instalment ($)
	Repayment Date

	766,667
	on or before Third Supplemental  Effective Date

	191,667
	8 November 2020

	191,667
	8 February 2021

	9,199,996
	8 February 2021

.";
		
	4.1.5
	the definition of "Consolidated Tangible Net Worth" contained in clause 21 (Financial Covenants) of the Loan Agreement shall be deleted and replaced with the following:

""Consolidated Tangible Net Worth" means, subject to Clause 21.5 (Consolidated Tangible Net Worth) below, on a consolidated basis, the total shareholders' equity (including retained earnings) of the Guarantor, minus goodwill and as adjusted to exclude:
		
	(a)
	any incurred losses and/or write downs on assets sold or held for sale on or after 31 March 2016;

		
	(b)
	any losses incurred on or after 31 March 2016 as a result of the termination of a shipbuilding contract entered into by any person which was a member of the Group both at the time the applicable shipbuilding contract was entered into and at the time of termination; 

		
	(c)
	any impairment charges taken on assets on or after 31 March 2016; and

		
	(d)
	up to $100,000,000 of (i) incurred losses and/or write downs on assets sold or held for sale, (ii) any incurred losses on termination of any shipbuilding contract 

Exhibit -4.65

entered into by any person which was a member of the Group both at the time the applicable shipbuilding contract was entered into and at the time of termination and (iii) any impairment charges taken on assets, in each case prior to 31 March 2016."; and 

		
	4.1.6
	Clause 21.5 (Consolidated Tangible Net Worth) of the Loan Agreement shall be deleted and replaced with the following:

"21.5     Consolidated Tangible Net Worth
		
	21.5.1
	The Borrowers shall immediately notify the Agent in writing if an amendment is made to the Nordea US$409,000,000 credit agreement dated as of 30 December 2014 (as amended, supplemented, restated or modified from time to time, the "Nordea Agreement", being a Financing Agreement as defined in Clause 21.4 (Most Favoured Nations Clause) above) to:

		
	(a)
	amend the definition of "Consolidated Tangible Net Worth" in the Nordea Agreement so that paragraph (a), (b) and (c) of such definition refer to losses, write downs and impairment charges incurred on or after 31 December 2013;

		
	(b)
	amend the definition of "Consolidated Tangible Net Worth" in the Nordea Agreement so that paragraph (d) of such definition refers to an amount other than "$100,000,000"; and/or

		
	(c)
	amend the minimum tangible net worth and/or the maximum leverage covenants in the Nordea Agreement.

		
	21.5.2
	The Agent and the Borrowers agree that following any notification given by the Borrowers pursuant to Clause 21.5.1 above, the Agent shall:

		
	(a)
	in the case of an amendment as set out in Clause 21.5.1(a) above, notify the Borrowers that paragraph (a), (b) and (c) of the definition of Consolidated Tangible Net Worth as set out in this Clause 21 (Financial Covenants) shall be automatically amended to read as follows:

"“Consolidated Tangible Net Worth” means, on a consolidated basis, the total shareholders’ equity (including retained earnings) of the Guarantor, minus goodwill and as adjusted to exclude:
		
	(a)
	any incurred losses and/or write downs on assets sold or held for sale on or after 31 December 2013;

		
	(b)
	any losses incurred on or after 31 December 2013 as a result of the termination of a shipbuilding contract entered into by any person which was a member of the Group both at the time the applicable shipbuilding contract was entered into and at the time of termination; 

		
	(c)
	any impairment charges taken on assets on or after 31 December 2013; and

Exhibit -4.65

		
	(d)
	up to $100,000,000 (or as otherwise amended pursuant to this Clause 21.5.2(b)) of (a) incurred losses and/or write downs on assets sold or held for sale, (b) any incurred losses on termination of any shipbuilding contract entered into by any person which was a member of the Group both at the time the applicable shipbuilding contract was entered into and at the time of termination and (c) any impairment charges taken on assets, in each case prior to 31 March 2016; and", or    

such materially similar definition as may be agreed in writing between the Agent (acting on the reasonable instructions of the Lenders) and the Borrowers at the relevant time; 
		
	(b)
	in the case of an amendment as set out in Clause 21.5.1(b) above, notify the Borrowers whether or not:

		
	(i)
	the amendment set out above at Clause 21.5.1(b) will be made.  In these circumstances the amendment will be made automatically upon the aforementioned notification by the Agent; or

		
	(ii)
	an equivalent amendment is to be made to section (d) of the definition of Consolidated Tangible Net Worth as set out in this Clause 21 (Financial Covenants).  In the event that any such equivalent change is to be made, the Parties shall enter into an appropriate amendment to this Agreement; and

		
	(c)
	in the case of an amendment as set out in Clause 21.5.1(c) above, notify the Borrowers whether or not:

		
	(i)
	the amendment set out above at Clause 21.5.1(c) will be made. In these circumstances the amendment will be made automatically upon the aforementioned notification by the Agent; or

		
	(ii) 
	an equivalent amendment is to be made to Clauses 21.2 (Minimum Tangible Net Worth) and / or 21.3 (Maximum Leverage) of this Agreement. In the event that any such equivalent change is to be made, the Parties shall enter into an appropriate amendment to this Agreement.".

		
	4.1.7
	All other terms and conditions of the Loan Agreement shall remain unaltered and in full force and effect.

		
	5
	Confirmations and Undertakings

		
	5.1
	Each of the Security Parties confirms that all of its respective obligations under or pursuant to each of the Security Documents to which it is a party remain in full force and effect, despite the amendments to the Loan Agreement made in this Supplemental Agreement, as if all references in any of the Security Documents to the Loan Agreement are references to the Loan Agreement as amended and supplemented by this Supplemental Agreement.

Exhibit -4.65

		
	5.2
	The definition of any term defined in any of the Security Documents shall, to the extent necessary, be modified to reflect the amendments to the Loan Agreement made in or pursuant to this Supplemental Agreement.

		
	6
	Notices, Governing Law and Enforcement

The provisions of clauses 31, 40 and 41 of the Loan Agreement shall apply to this Supplemental Agreement as if they are set out in full and as if (a) references to each Party are references to each party to this Supplemental Agreement, (b) references to the Finance Documents include this Supplemental Agreement and (c) references to the Borrowers are references to each Security Party.

		
	Schedule 1
	

The Lenders
ABN AMRO Bank N.V.
Coolsingel 93                
3012 AE Rotterdam            
The Netherlands        
Fax no.: +31 10 401 5323   

Exhibit -4.65

		
	Schedule 2
	

Effective Date Confirmation

To:    SBI Achilles Shipping Company Limited; and
SBI Hermes Shipping Company Limited

Cc:    Scorpio Bulkers Inc. 

Exhibit -4.65

We, ABN AMRO Bank N.V., refer to the third supplemental agreement dated     30/12 /2016 (the "Third Supplemental Agreement") relating to a secured loan agreement dated 22 December 2015 as amended and supplemented by a first supplemental agreement dated 6 April 2016 and a second supplemental agreement dated 2 June 2016 (the "Loan Agreement") made between you as the Borrowers, Scorpio Bulkers Inc. as the Guarantor, the banks listed in it as the Lenders, ourselves as the Agent, ABN AMRO Bank N.V. as the Swap Provider and ourselves  as the Security Agent in respect of a loan to you from the Lenders of up to $27,250,000.
We hereby confirm that all conditions precedent referred to in Clause 2.1 of the Third  Supplemental Agreement have been satisfied.  In accordance with Clause 1.1 of the Third  Supplemental Agreement the Effective Date is the date of this confirmation and the amendments to the Loan Agreement are now effective.

Dated   30/12/2016          

Signed: /s/ P.r Vogelzang   /s/ E.J.R Olman
For and on behalf of
ABN AMRO Bank N.V.

In witness of which the parties to this Supplemental Agreement have executed this Supplemental Agreement as a deed the day and year first before written.

Exhibit -4.65

Signed and delivered as             )
a Deed by                 )
SBI Achilles Shipping Company Limited    )
acting by                    )                    )
its duly authorised                )                    )
in the presence of:                )
Witness signature:................................................
Name:
Address:

Signed and delivered as             )
a Deed by                 )
SBI Hermes Shipping Company Limited    )
acting by                    )                    )
its duly authorised                )                    )
in the presence of:                )
Witness signature:................................................
Name:
Address:

Signed and delivered as             )
a Deed by                 )
Scorpio Bulkers Inc.            )
acting by                    )
)
its duly authorised                )                    )
in the presence of:                )
Witness signature:................................................
Name:
Address:

Exhibit -4.65

Signed and delivered as             )
a Deed by                 )
ABN AMRO Bank N.V. (as a Lender)        )
acting by    /s/ P.R. Vogelzang
/s/ E.J.R Olman                )
)
its duly authorised                )
)
in the presence of:                )

Witness signature:.../s/ M. Huijsers..................
Name:
Address:

Signed and delivered as             )
a Deed by                 )
ABN AMRO Bank N.V.             )
(as Agent)                )
acting by    /s/ P.R. Vogelzang
/s/ E.J.R Olman                    )
)
its duly authorised                )
)
in the presence of:                )

Witness signature:....../s/ M. Huijsers..................
Name:
Address:

Signed and delivered as             )
a Deed by                 )
ABN AMRO Bank N.V.            )
 (as Swap Provider)                )        
acting by    /s/ P.R. Vogelzang
/s/ E.J.R Olman                    )
)
its duly authorised                )
)
in the presence of:                )

Witness signature:....../s/ M. Huijsers..................
Name:
Address:

Exhibit -4.65

Signed and delivered as             )
a Deed by                 )
ABN AMRO Bank N.V.            )
(as Arranger)                )
acting by    /s/ P.R. Vogelzang
/s/ E.J.R Olman                    )
)
its duly authorised                )
)
in the presence of:                                     )

Witness signature:....../s/ M. Huijsers..................
Name:
Address:

Signed and delivered as             )
a Deed by                 )
ABN AMRO Bank N.V.            )
(as Security Agent)                )
acting by    /s/ P.R. Vogelzang
/s/ E.J.R Olman                    )
)
its duly authorised                )
)
in the presence of:                )

Witness signature:....../s/ M. Huijsers..................
Name:
Address:Exhibit

EXHIBIT 10.5

PERFORMANCE SHARES AWARD AGREEMENT

KeyCorp grants to the Participant named below, in accordance with the terms, and subject to the conditions, of the KeyCorp 2013 Equity Compensation Plan (the “Plan”), this Performance Shares Award Agreement (the “Award Agreement”) and the attached Acceptance Agreement, an award of the target number of performance shares (“Performance Shares” or “Award”), on the Date of Grant, each as set forth below.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Plan.  
Each Performance Share represents the contingent right to receive one Common Share, subject to the terms and conditions set forth in the Plan, this Award Agreement and the Acceptance Agreement.  The Participant’s right to receive payment of all, a portion, or a multiple of the Performance Shares shall be contingent upon the level of achievement of the Performance Goals and the Participant’s continued employment, each as provided herein, in all cases subject to the other terms and conditions of this Award Agreement, the Plan and the Acceptance Agreement, including, if the Participant is a 162(m) Covered Employee (as defined in Appendix A) the additional terms and conditions set forth in Appendix A.
	
		
	Name of Participant:
	[Participant Name]

	Number of Common Shares:
	[Shares Granted]

	Date of Grant:
	February __, 2017

	Vesting Date:
	February __, 20__, subject to approval of the Compensation and Organization Committee of the Board of Directors, and subject to your continued employment on this date and the achievement of the Performance Goals set forth below (except as otherwise provided in this Award Agreement)

	Performance Period:
	January 1, 2017 through December 31, 20__

	Performance Goals:
	The Participant may vest in between 0% and 150% of the target number of Performance Shares subject to this Award based on the weighted level of achievement of the following “Performance Goals” during the Performance Period:

	
							
	Performance Goals
	Other Factors
(Vesting Reduction Only)

	Performance Metric
	Weight
	Threshold
	Target
	Maximum

	50% Weighted
Vesting 
	100% Weighted
Vesting
	150% Weighted
Vesting

	Total Shareholder Return  vs. Peers
	25%
	25% ile
	50% ile
	75% ile
	ERM Dashboard
	 

	Return on Tangible Common Equity v. Peers
	25%
	25% ile
	50% ile
	75% ile
	Execution of Strategic Priorities

	Cumulative 
Earnings Per Share
	50%
	75% of EPS at Plan*
	100% of EPS at Plan*
	125% of EPS at Plan*
	Other factors, as appropriate

Straight line interpolation applies for performance between Threshold and Maximum levels.
The Committee shall determine the level of achievement of the Performance Goals within two and one-half months after the end of the Performance Period in accordance with the provisions of this Award Agreement, the Plan and the Acceptance Agreement.  Notwithstanding any other provision of the Award Agreement, the Committee may reduce the number of Performance Shares otherwise vesting based on the Other Factors set forth above, as determined by the Committee in its sole discretion.   
For purposes of this Award Agreement:
		
	*EPS at Plan: 
	The Cumulative Earnings Per Share as set forth in the KeyCorp 2017-2019 Long Term Incentive Compensation Plan, which excludes any impact to Cumulative Earnings Per Share based on changes to interest rates.  EPS at Plan may be adjusted by KeyCorp, in its discretion, to correspond to changes in interest rates.

		
	Total Shareholder Return vs. Peers:
	KeyCorp’s percentile ranking among the companies in the Peer Group (as defined below) for total shareholder return for the Performance Period, calculated based on the average closing share price over the last 20 trading days in 2016 compared to the average closing share price over the last 20 days in 2019 plus investment of dividends paid during the Performance Period.

Return on Tangible Common Equity 
		
	v. Peers:
	KeyCorp’s percentile ranking among the companies in the Peer Group (as defined below) for average annual return on tangible common equity during the three fiscal years of (or ending during) the Performance Period, with return on tangible common equity calculated as net income from continuing operations attributable to common shareholders divided by average tangible common equity from continuing operations.

		
	Cumulative Earnings Per Share:
	The sum of KeyCorp’s annual earnings per share for the three fiscal years in the Performance Period, as reported in the Form 10-Ks filed by KeyCorp for such fiscal years.  

		
	Peer Group:
	The companies in the S&P Banks Index on the Date of Grant, excluding Wells Fargo & Company and Hudson City Bancorp, with such adjustments to the composition of the Peer Group as may be determined by the Committee, in its sole discretion. The Committee reviews the companies in the Peer Group annually.  

____________________________________________________________________________
The Participant must accept the Award online in accordance with the procedures established by KeyCorp and the Award administrator or this Award Agreement may be cancelled by KeyCorp, in its sole discretion. By accepting the Award in accordance with these procedures, the Participant acknowledges that: 
		
	•
	This Award is subject to the KeyCorp Incentive Compensation Program and Policy, as amended from time to time.  The Participant understands and agrees that the Award is subject to risk adjustment in accordance with the procedures set forth in the Incentive Compensation Program and Policy.  These procedures permit Key, in its sole discretion, to decrease, forfeit, or initiate a clawback, of all or any part of the Award under certain circumstances, including in the event that the Participant receives a "Does Not Meet" risk rating as part of his or her annual performance review, and/or in the event that the Participant's business unit experiences negative pre-provision net revenue (before allocated costs) or significant credit, market or operational losses.  If a significant risk event occurs, whether at the individual or business level, a root cause analysis may be conducted, which may result in a risk adjustment of the Award.

		
	•
	The Participant understands that as a condition to receiving the Award, the Participant must agree to be bound by and comply with the terms and conditions of the Plan, the Award Agreement and related Acceptance Agreement.  As soon as the Participant accepts the Award, the terms and conditions of the Award Agreement and Acceptance Agreement will constitute a legal contract that will bind both the Participant and KeyCorp.

Additional Terms

1.      Effect of Termination.  

(a)    In General.  The Award shall be forfeited automatically without further action or notice if the Participant ceases to be continuously employed by Key prior to the Vesting Date, except as otherwise provided in this Section 1.  For purposes of this Section 1, the continuous employment of the Participant shall not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of Key, by reason of the transfer of employment among KeyCorp and its affiliates.

(b)    Certain Terminations.  Notwithstanding Section 1(a), if, prior to the Vesting Date, the Participant’s continuous employment is terminated as a result of the Participant’s death, Disability, or Retirement, the Participant shall, (i) for any unvested Performance Shares that were granted one year or more prior to the Participant’s effective termination date, fully vest in such Performance Shares, and (ii) for any unvested Performance Shares that were granted less than one year prior to Participant’s effective termination date, vest in a pro rata portion of such Performance Shares.  Key may, in its sole discretion, provide that any unvested Performance Shares that would otherwise be subject to Section 1(b)(ii) (i.e., vest in a pro rata portion because such Performance Shares were granted less than one year prior to Participant’s effective termination date) may instead be treated consistent with Section 1(b)(i) (i.e., fully vest).
If, prior to the Vesting Date, the Participant’s continuous employment is terminated as a result of a Termination Under Limited Circumstances, the Participant will vest in a pro rata portion of any unvested Performance Shares. 
Performance Shares vested under the provisions of this Section 1(b) shall be distributed on the remaining Vesting Date(s), as applicable.
For purposes of this Award Agreement, a Participant’s “Retirement” shall mean the Participant’s Voluntary Resignation on or after attaining age 60 and completion of at least 10 years of service.  A Participant’s Voluntary Resignation on or after attaining age 55 and completion of at least 5 years of service (excluding a Voluntary Resignation that constitutes a Retirement, as defined above) will receive the same treatment as a Termination Under Limited Circumstances for purposes of this Award Agreement.  A Participant’s “Termination Under Limited Circumstances” shall mean a Participant’s termination from Key under circumstances in which the Participant becomes entitled to receive: (i) a severance under the KeyCorp Separation Pay Plan as in effect at the time of the Participant’s termination, or (ii) under circumstances under which the Participant is entitled to receive salary continuation benefits under the terms and conditions of an employment separation or letter agreement with Key, including, without limitation, a Change of Control Agreement.  
The pro rata vesting provided for under this Award Agreement shall be determined by multiplying the number of unvested Performance Shares as of the date of the Participant’s termination by a fraction, the numerator of which shall be the number of full months of Participant’s continuous employment from the Date of Grant through the date of termination and the denominator of which shall be number of full months between the Date of Grant and latest Vesting Date.

(c)    Certain Terminations Within Two Years After a Change of Control.  Notwithstanding the foregoing provisions of Section 1, if, prior to the Vesting Date, the Participant’s continuous employment with Key is terminated within two years following the date of a Change of Control for any reason other than a Voluntary Resignation (excluding a Voluntary Resignation that constitutes a Retirement, as defined above) or a Termination for Cause, the target number of Performance Shares (or if such Change of Control and termination of employment occurs after the end of the Performance Period, the number of Performance Shares earned under this Award Agreement based upon achievement of the Performance Goals) shall become immediately vested (without pro ration).

2.    Payment of Vested Performance Shares.  Except as otherwise provided in Sections 1(b) or 1(c), any Performance Shares earned pursuant to this Award Agreement shall become vested only if the Participant remains continuously employed by Key from the Date of Grant through the Vesting Date.  Payment of any earned and vested Performance Shares shall be made in the form of Common Shares for each vested Performance Share.  Payment shall occur as soon as practicable following the vesting of the Performance Shares but in no event later than two and one-half months after the Vesting Date.  
3.    Dividend Equivalents.  Dividend equivalents shall be credited on the target number of Performance Shares which shall be deemed reinvested and be subject to the same terms and restrictions otherwise applicable to the Performance Shares (including but not limited to vesting requirements) under this Award Agreement, the Plan and the Acceptance Agreement.
4.    Harmful Activity.  Notwithstanding any other provision of this Award Agreement to the contrary, if the Participant engages in any Harmful Activity prior to or within twelve months after the Participant’s termination of employment with Key, then the 

Performance Shares shall be immediately forfeited without further action or notice, and any Common Shares delivered in payment of the Award within one year prior to the Participant’s termination of employment, and any Profits realized by the Participant from the sale of such Common Shares, shall become immediately due and payable to KeyCorp on KeyCorp’s demand.  This Section 4 shall survive the termination of Participant’s employment.
5.    KeyCorp’s Reservation of Rights.  As a condition of receiving this Award, the Participant acknowledges and agrees that Key intends to comply with the requirements of (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act (including clawback provisions), as the same may be amended from time to time; (b) the banking regulatory agencies’ Guidance on Sound Incentive Compensation Policies; and (c) KeyCorp’s risk requirements and policies.  As a condition of receiving this Award, the Participant understands and agrees that KeyCorp may, in its sole discretion, (x) decrease or cause the forfeiture of all or any part of this Award, (y) initiate a clawback of all or any part of this Award, and/or (z) demand the Participant’s repayment to KeyCorp of any Common Shares paid to the Participant under this Award, or the Profits realized from the sale of such Common Shares, if KeyCorp determines that such action is necessary or desirable.
6.    Relation to Other Benefits.  Any economic or other benefit to the Participant under this Award Agreement shall not be taken into account in determining any benefits to which the Participant may be entitled under any profit-sharing, retirement or other benefit or compensation plan maintained by Key and shall not affect the amount of any life insurance coverage available to any beneficiary under any life insurance plan covering employees of Key.
7.      KeyCorp Stock Ownership Guidelines.  If the Participant is subject to and has not met the KeyCorp Stock Ownership Guidelines, the Participant may not sell or otherwise transfer the Common Shares provided upon vesting of the Award (if any) until and unless the Participant meets the Stock Ownership Guidelines or terminates employment with Key; provided, however, that notwithstanding the foregoing, the Participant may sell the number of Common Shares necessary to satisfy any withholding tax obligation that may arise in connection with the vesting of this Award even the Participant has not met the Stock Ownership Guidelines. 
8.    Taxes and Withholding.  To the extent that Key is required to withhold any federal, state, local or other taxes in connection with the delivery of Common Shares under this Award Agreement, then Key shall retain a number of Common Shares otherwise deliverable hereunder with a value equal to the required withholding (based on the Fair Market Value of the Common Shares on the date of delivery).  To the extent that Key is required to withhold any federal, state, local or other taxes at any time other than upon delivery of Common Shares under this Award Agreement, then Key shall have the right in its sole discretion to (a) require the Participant to pay or provide for payment of the required tax withholding, (b) retain a number of Common Shares that otherwise would remain subject to this Award with a value equal to the required withholding amount (determined based on the Fair Market Value of the Common Shares on the date the applicable taxes are required to be withheld) and make a corresponding reduction in the number of Performance Shares subject to this Award, or (c) deduct the required tax withholding from any other compensation payable in cash to the Participant.  To the extent that withholding taxes are satisfied by the retention of Common Shares, the value of the Common Shares so retained shall not exceed the amount of taxes required to be withheld based on the maximum statutory tax rates in the applicable taxing jurisdictions.  Further, to the extent that this Award constitutes a deferral of compensation subject to Section 409A of the Code, any retention of Common Shares pursuant to clause (b) of the immediately preceding sentence to satisfy tax withholding requirements at any time other than at the time of delivery of Common Shares shall be effected only as permitted pursuant to Treasury Regulations Sections 1.409A-3(j)(4)(vi) and 1.409A-3(j)(4)(xi), as applicable.
9.    Entire Agreement; Amendments.  This Award Agreement, along with the Plan and the related Acceptance Agreement, contains the entire agreement and understanding of the parties with respect to the subject matter contained therein, and supersedes all prior written or oral communications, representations and negotiations in respect thereto.  KeyCorp may modify or amend this Award Agreement at any time upon written notice to the Participant, provided that KeyCorp may not amend this Award Agreement in a manner adverse to the interests of the Participant without the Participant’s consent.  Notwithstanding any other provision of this Award Agreement, if the Committee determines that a change in the business, operations, corporate structure or capital structure of KeyCorp, the manner in which it conducts business or other events or circumstances render the Performance Goals to be unsuitable, the Committee may modify the Performance Goals and/or the related threshold, target and maximum levels of achievement, in whole or in part, as the Committee deems appropriate.  In the event of any inconsistency between the provisions of this Award Agreement or the related Acceptance Agreement, on the one hand, and the Plan, on the other, the Plan shall govern.
10.    Administration.  KeyCorp shall have the right, in accordance with the Plan, to determine any questions which arise in connection with the Award. All such determinations and decisions shall be final, conclusive and binding on all persons, including Key, the Participant and the Participant’s estate and beneficiaries.
11.    Successors and Assigns.  Without limiting Section 14.1 of the Plan, the provisions of this Award Agreement shall inure to the benefit of, and be binding upon, the successors, administrators, heirs, legal representatives and assigns of the Participant, and the successors and assigns of KeyCorp.
12.      Compliance with Section 409A of the Internal Revenue Code.  To the extent applicable, it is intended that this Award comply with the provisions of Section 409A of the Code (“Section 409A”).  The Award shall accordingly be administered in a 

manner consistent with this intent, and any provision that would cause the Award to fail to satisfy Section 409A shall have no force and effect until amended to comply with Section 409A. In particular, to the extent that the Participant’s right to receive payment under the Award becomes vested and the event triggering the Participant’s right to payment is the Participant’s termination of employment, then notwithstanding anything herein to the contrary, payment will be made to the Participant, to the extent necessary to comply with Section 409A, on the earlier of (a) the Participant’s “separation from service” (determined in accordance with Section 409A); provided, however, that if the Participant is a “specified employee” (determined in accordance with KeyCorp’s policies), the date of payment shall not occur until the first business day of the seventh month following the date of the Participant’s separation from service with Key, or (b) the Participant’s death.  Further, to the extent necessary to comply with Section 409A, a transaction shall be considered a Change of Control only if it also qualifies as a “change in the ownership” a “change in the effective control” or a “change in the ownership of a substantial portion of the assets” of KeyCorp within the meaning of Section 409A.

APPENDIX A
ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO 162(m) COVERED EMPLOYEES

This Appendix A sets forth certain additional terms and conditions which shall apply to the Participant’s Award if and only if the Participant is a “162(m) Covered Employee” (as defined in Section A, below).  This Appendix A is intended to provide for the qualification of a 162(m) Covered Employee’s Award as “performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code, and this Appendix A shall be interpreted and administered in accordance with such intent.

A.  Notwithstanding any other provision of the Award Agreement, if the Participant is a 162(m) Covered Employee, then the Award shall be forfeited automatically without further action or notice if the Initial Performance Objective (as defined below) is not achieved, except as otherwise provided in Section 1(c) of the Award Agreement.  For purposes of the Award Agreement, a “162(m) Covered Employee” means an individual who is a “covered employee” as defined in Section 162(m)(3) of the Code (and applicable Treasury Department regulations and other guidance published thereunder) for the taxable year in which KeyCorp would be entitled to deduct the payment of the Performance Shares for federal income tax purposes (disregarding any limitations on deductibility under Sections 162(m) or 280G of the Code).

B.  For purposes of this Award Agreement, the “Initial Performance Objective” shall be achieved if and only if the ratio of KeyCorp’s average Pre-Provision Net Revenue for the three fiscal years in the Performance Period to KeyCorp’s Average Assets for the three fiscal years that preceded the Performance Period equals or exceeds fifty percent (50%) of the same ratio for the three fiscal years that preceded the Performance Period.  For purposes of this Award Agreement, Pre-Provision Net Revenue shall mean KeyCorp’s pre-provision net revenue from continuing operations for the relevant fiscal years, and Average Assets shall mean KeyCorp’s average assets of continuing operations for the relevant fiscal years, each as reported in the Form 10-Ks filed by KeyCorp for the relevant fiscal years.  If the Participant is a 162(m) Covered Employee, KeyCorp’s achievement of the Initial Performance Objective shall be certified by the Committee in writing within two and one-half months after the end of the Performance Period and prior to the payment of any Performance Shares under the Award Agreement.

C.  Notwithstanding any other provision of the Award Agreement, if the Participant is a 162(m) Covered Employee, then subject to potential reduction by the Committee pursuant to paragraph D below, if the Initial Performance Objective is achieved, then KeyCorp shall credit to the Participant’s account a number of Performance Shares equal to 150% of the target number of Performance Shares, or such lesser number of Performance Shares as may be determined by the Committee, in its discretion, in accordance with paragraph D below.

D.  Notwithstanding paragraph C above, if the Participant is a 162(m) Covered Employee, the actual number of Performance Shares credited to the Participant’s account pursuant to the Award Agreement may be reduced by the Committee in its discretion below the number of Performance Shares, if any, earned based upon achievement of the Initial Performance Objective (including a reduction to zero).  It is the current intention of the Committee that any such reduction shall be made based on the level of achievement of the performance goals described in the Award Agreement, as determined by the Committee.

ACCEPTANCE AGREEMENT

I acknowledge receipt of the attached Award and in consideration thereof, I accept such Award subject to the terms and conditions of the Plan, the Award Agreement, and the restrictions that are set forth in this Acceptance Agreement. 

I also understand and agree that the restrictions set forth in this Acceptance Agreement are (i) in addition to, and do not in any way limit or vary the restrictions that are contained in any other agreement, plan, policy, or practice that are applicable to me as an employee of Key, and (ii) binding upon me regardless of whether I vest, sell, transfer, pledge, hypothecate, or otherwise dispose of the Award or any of the Common Shares to be paid to me pursuant to the Award. 

1.  I recognize the importance of preserving the confidentiality of Non-Public Information of Key, and 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) both during and after my employment with Key, I will not use, publish, sell, trade or otherwise disclose such Non-Public Information; and (c) upon the termination of my employment with Key, I will immediately return to Key all documents, data, information and equipmentin my possession or to which I have access that may contain such Non-Public Information. I also agree to enter into and to execute nondisclosure agreements in favor of Key and others doing business with Key with whom Key has a confidential relationship.

I acknowledge that Key has informed me that I will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of Non-Public Information that: (1) is made (a) in confidence to a Federal, state or local government official, either directly or indirectly, or to an attorney, and (b) solely for the purpose of reporting or investigating a suspected violation of law; or (2) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  Disclosure of Non-Public Information to attorneys, made under seal, or pursuant to court order is also protected in certain circumstances under the federal Defend Trade Secrets Act.  This provision does not limit my right to respond accurately and fully to any question, inquiry or request for information when required by legal process or from initiating communications directly with, or responding to any inquiry from, or providing testimony before, any self-regulatory organization or state or federal regulatory authority, regarding Key, my employment, or this provision.  Furthermore, I am not required to contact Key regarding the subject matter of any such communications before engaging in such communications.  I understand that my rights as set forth in this paragraph apply to this agreement, as well as any similar agreement that I have entered into, or may enter into, with Key regarding non-disclosure of information.

2.  I acknowledge and agree that the duties of my position at Key may include the development of Intellectual Property, and that any Intellectual Property which I create with any of Key’s resources or assistance, in whole or in part, and which pertains to the business of Key is the property of Key.  I hereby agree and I hereby assign to Key all right, title, and interest in and absolute title to such Intellectual Property, including, without limitation, copyrights, trademarks, service marks, and patents in or to (or associated with) such Intellectual Property and I agree that I will execute all patent applications and assignments thereof on Key’s behalf 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 Key may grant or withhold in its discretion).  “Key Employees” shall include (i) all current Key employees, and (ii) all  persons who were employed by Key at any time during the six (6) month period prior to my termination from Key. 

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 any Key customer or prospective customer of Key with whom I interacted or learned during the course of my employment at Key, without the written consent of Key (which consent Key may grant or withhold in its discretion). 

(b)  In the event that my employment with Key is terminated as a result of a Termination Under Limited Circumstances, the restrictions in paragraph 4(a) of this Acceptance Agreement shall become inapplicable to me; however, the restrictions in paragraphs 1, 2, and 3 of this Acceptance Agreement shall remain in full force and effect.  

5.  The aforementioned restrictions in paragraphs 1, 2, 3 and 4(a) shall not apply in the event that, within the 2-year period commencing on a Change of Control: (i) my employment with Key is terminated as a result of a Termination Under Limited Circumstances, or (ii) I terminate employment with Key after a relocation of my principal place of employment more than 35 miles from my principal place of employment immediately prior to the Change of Control, or after a reduction in my base salary after a Change of Control.

6.  I agree that the Plan, the Award Agreement and this Acceptance Agreement will be governed by Ohio law without regard to conflicts of laws principles, and that if any term, condition, clause or provision of the Plan, the Award Agreement or this Acceptance Agreement is determined by a Court of competent jurisdiction to be void or invalid at law, then only that term, condition, clause or provision determined to be void or invalid shall be stricken, and the remainder of the Plan, the Award Agreement and this Acceptance Agreement shall remain in full force and effect in all other aspects.  

I also understand and agree that if I engage in any activity that is in violation of the Plan, the Award Agreement or this Acceptance Agreement, such conduct may cause serious damage and irreparable injury to Key, and Key at its election may terminate my employment (if I am still employed), seek monetary damages and attorney fees, and injunctive relief without the necessity of posting bond, as well as any and all other equitable relief to which it may be entitled under the law, the Plan, the Award Agreement and this Acceptance Agreement.  

* * * * *

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