Document:

Wdesk | EX 10.01 3.31.2015

Exhibit 10.01
Central European Media Enterprises Ltd. Stock Incentive Plan 
Form of PRSU Agreement (for use from March 2015)
CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
RESTRICTED STOCK UNIT AWARD AGREEMENT
(PERFORMANCE-BASED VESTING)
This Restricted Stock Unit Award Agreement (including the annexes attached hereto, the “Agreement”) dated as of [•] is between Central European Media Enterprises Ltd. (the “Company”) and [•] (the “Grantee”).
		
	1.
	Grant of Award.  The Company hereby grants to the Grantee as of the date hereof, in accordance with the terms of the Company’s Amended and Restated Stock Incentive Plan  (as amended, the “Plan”) and subject to and upon the terms, conditions and restrictions of this Agreement, a “Target” award of [•] restricted stock units (the “Performance Restricted Stock Units”, “PRSUs” or the “Award”). Subject to the provisions of this Agreement, the total number of PRSUs that will vest as of any Vesting Date (as defined in Annex A) will be determined in accordance with the provisions of Annex A and is subject to the satisfaction of the performance vesting criteria set out in Annex A hereto and Grantee’s continuous employment with the Company or any of its Subsidiaries (“Service”) from the date hereof through the corresponding Vesting Date.

Each Performance Restricted Stock Unit represents a right to receive one share of Class A Common Stock of the Company for each Performance Restricted Stock Unit that vests in accordance with Annex A.  Unless specifically provided for in this Agreement, the Award shall be governed by the terms of the Plan, which are incorporated herein by reference.
		
	2.
	Additional Vesting Provisions.

		
	(a)
	Right to Award.  The actual vesting of any PRSUs will be determined based on the satisfaction of the performance vesting requirements in accordance with Annex A and with the applicable provisions of the Plan and this Agreement.

		
	(b)
	Termination of Service. In the event the Grantee’s Service ceases for any reason (other than as provided in Section 2(c) below or Annex B), Performance Restricted Stock Units that have not previously vested prior to such cessation of Service shall immediately be forfeited to the Company without payment of any consideration for the Performance Restricted Stock Units, and the Grantee will have no further right, title or interest in or to such Performance Restricted Stock Units or the underlying shares.

		
	(c)
	Death or Disability.  In the event the Grantee’s Service ceases due to the Grantee’s death or termination by the Company due to disability, the performance restrictions on the Target amount of Performance Restricted Stock Units that have not previously vested shall lapse and such Performance Restricted Stock Units shall become fully vested upon such cessation.  For purposes of this Agreement, “disability” means the Grantee’s inability to perform the duties and responsibilities required of the Grantee by reason of a physical or mental disability or infirmity which has continued for more than one hundred and twenty (120) consecutive calendar days in any twelve (12) consecutive month period, as determined by the Committee.

		
	(d)
	Change of Control. Notwithstanding any other provision of this Agreement or the Plan, Awards of Performance Restricted Stock Units that have not previously vested will vest in accordance with the provisions of Annex B in connection with a Change of Control or a Time Warner Transaction (as defined in Annex B). Section 17.B. of the Plan shall not apply to this Award.

		
	3.
	Settlement of the Award; Delivery of Shares.  

		
	(a)
	Delivery of Shares. Subject to Sections 5, 7 and 8, the Company shall issue shares of Class A Common Stock within sixty (60) days following the vesting of the Award or portion thereof. 

		
	(b)
	Book-entry Settlement.  Upon issuance of shares of Class A Common Stock, the Company shall name the Grantee as the registered holder of such shares in the Company’s share register.

		
	4.
	Adjustments for Changes in Capitalization.  In the event the Committee makes any adjustment to the Performance Restricted Stock Units underlying the Award pursuant to the Plan following a change of capitalization, any additional Performance Restricted Stock Units or other property that become subject to the Award will, unless otherwise determined by the Committee, be subject to the same forfeiture restrictions, delivery requirements and other provisions of this Agreement applicable to Performance Restricted Stock Units underlying this Award.  No fractional shares or rights to fractional shares of Class A Common Stock will be created or issued. Any fraction of a share will be rounded down to the nearest whole share.

		
	5.
	Withholding Taxes.  Grantee acknowledges that Grantee may be liable for taxes assessed and/or withheld on the Award pursuant to applicable federal, state, national or local law under the applicable laws of the jurisdiction where the Grantee is resident or may otherwise be applicable to the Grantee in respect of the Performance Restricted Stock Units or the issuance of shares of Class A Common Stock underlying the Performance Restricted Stock Units.  

		
	(a)
	Amount of Withholding Taxes.  Prior to the settlement of any portion of the Award, the Company shall inform the Grantee of (i) the estimated amount of any federal, state, national, local income and employment taxes and social, health or national insurance (collectively, “Taxes”) which the Company determines will be owed by the Grantee, by reason of the vesting and/or settlement of the Award and (ii) the amount, if any, that the Company or any of its Subsidiaries will be required to withhold from the Grantee by reason of such vesting and/or settlement.  

		
	(b)
	Payment of Withholding Taxes. The Grantee may satisfy its obligation in respect of withholding Taxes: (a) by paying to the Company in cash an amount equal to the withholding Taxes no later than the date of settlement of the Award; or (b) subject to compliance with applicable law and the Company’s Insider Trading Policy, by delivering to the Company an instruction to a broker approved by the Company providing for the assignment of the proceeds from the sale of some or all of the shares of Class A Common Stock to be received on the settlement of an Award. The Company may withhold amounts from any compensation otherwise payable to the Grantee by the Company or any of its Subsidiaries, and the Grantee hereby authorizes the withholding from compensation payable to Grantee, any amounts required to satisfy the federal, state, national or local withholding Tax obligations of the Company or any of its Subsidiaries in connection with the Award. The Company shall not be required to deliver any shares of Class A Common Stock if it has not received satisfactory evidence of payment of all withholding Taxes.

1

		
	(c)
	Satisfying Withholding Tax Obligations with Shares. The Company may, in the discretion of the Committee, permit the Grantee to satisfy all or any portion of the Company’s or any of its Subsidiaries’ obligations for withholding Taxes in respect of an Award by deducting from the shares of Class A Common Stock the Grantee would otherwise receive a number of shares having a fair market value equal to the amount of withholding Taxes that are payable (using the minimum statutory rates of withholding for purposes of determining such amount).  The Grantee agrees that delivery of a number of shares of Class A Common Stock net of the amount deducted for purposes of satisfying withholding Tax obligations shall be full settlement of the Award for all purposes. 

		
	6.
	Non Transferability.    The Grantee shall not sell, assign, exchange, transfer (other than by will or the laws of descent or distribution), pledge, charge, hypothecate or otherwise dispose of or encumber the Award or the Performance Restricted Stock Units.

		
	7.
	Rights as a Shareholder. Neither the Grantee nor the Grantee’s representative shall have any rights as a shareholder with respect to any shares of Class A Common Stock underlying any Performance Restricted Stock Units until such Award or any of its portion, as the case may be, has vested and such shares of Class A Common Stock have been issued, recorded in the records of the Company or its transfer agent and delivered to the Grantee.  The Grantee must complete such administrative documentation required by this Agreement or the Committee before the Company may issue the shares of Class A Common Stock, record such issuance in the records of the Company or its transfer agent and deliver such shares of Class A Common Stock to the Grantee following a Vesting Date.  The Company may postpone such issuance, recording and delivery of the shares of Class A Common Stock if such proper documentation is not received by the Company. If proper documentation is not received by the Company within sixty (60) days of a Vesting Date, the corresponding portion of the Award, in the sole discretion of the Committee, may be forfeited for no consideration.

		
	8.
	Regulatory Compliance.  The Company may postpone issuing  and recording the shares of Class A Common Stock to the Grantee issuable pursuant to this Agreement in the records of the Company or its transfer agent for such period as may be required to comply with any applicable requirements under any applicable securities laws, the listing requirements of any applicable stock exchange, and any requirements under any other applicable law, and the Company shall not be obligated to deliver any such shares of Class A Common Stock to the Grantee if either delivery thereof would constitute a violation of any provision of any law or of any regulation of any governmental authority or any applicable stock exchange.  The Company shall not be liable to the Grantee or its representative for any damages relating from any delays in recording the issuance and delivery of shares to the Grantee in the records of the Company or its transfer agent or any mistakes or errors connected therewith.

		
	9.
	Effect Upon Service.  Nothing contained in this Agreement or in the Plan shall confer upon the Grantee any right with respect to the continuation of the Grantee’s Service with the Company or interfere in any way with the right of the Company, subject to the terms of any separate agreement to the contrary, at any time to terminate such Service.

		
	10.
	Reference to the Plan.  The Award has been granted pursuant to and subject to the provisions of the Plan, which are hereby incorporated herein by reference. Except as otherwise provided herein, in the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall govern.  All capitalized terms that are used in this Agreement and not otherwise defined herein shall have the meanings ascribed to them in the Plan.

		
	11.
	Determinations.  The Committee has the power to interpret the Plan and this Agreement and to administer, interpret and apply the Plan in respect of the Performance Restricted Stock Units in a manner consistent with the terms thereof and hereof (including, but not limited to, determining, in is sole and absolute discretion, whether any Performance Restricted Stock Units have vested and whether any unvested Performance Restricted Stock Units of the Grantee may be accelerated and the corresponding Vesting Date thereof).  Each determination, interpretation or other action made or taken pursuant to the provisions of this Agreement by the Committee shall be final and conclusive for all purposes and shall be binding upon all persons, including, without limitation, the Company and the Grantee, and the Grantee’s respective successors and assigns. 

		
	12.
	Incentive Compensation Recoupment Policy.  The Award and the underlying Performance Restricted Stock Units are subject to recoupment in accordance with the Company’s Incentive Compensation Recoupment Policy in effect from time to time.

		
	13.
	Section 409A of the Code.  It is intended that the Performance Restricted Stock Units are exempt from Sections 409A and 457A of the U.S. Internal Revenue Code of 1986 (as amended, the “Code”) pursuant to the “short-term deferral” rule applicable to each such section, as set forth in the regulations or other guidance published thereunder.  Notwithstanding the foregoing, the Grantee shall be solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on the Grantee in connection with the Award (including any taxes and penalties under Sections 409A and 457A of the Code), and neither the Company nor any of its Subsidiaries shall have any obligation to indemnify or otherwise hold the Grantee harmless from any or all of such taxes or penalties.

		
	14.
	Acceptance of Award. The grant of Performance Restricted Stock Units evidenced by this Agreement shall be forfeited for no consideration if this Agreement is not accepted by the Grantee by executing and returning a copy of this Agreement to the Company within ninety (90) days of the date hereof. 

		
	15.
	Amendment. The Grantee hereby consents to any amendment to this Agreement in any way the Committee deems necessary or advisable to comply with or satisfy exemption from Sections 409A and 457A of the Code, to carry out the purpose of the grant, or in connection with any change in applicable laws or regulation or any future law or regulation. Except as provided above, any amendment to this Agreement must be in writing and signed by the Company and the Grantee.  

		
	16.
	Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto shall be governed by the laws of Bermuda.

		
	17.
	Severability.  In the event any provision of this Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions of this Agreement, and this Agreement shall be construed and enforced as if such illegal or invalid provision had not been included.  

		
	18.
	Counterparts.  This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

Signatures appear on following page

2

IN WITNESS WHEREOF, the parties have executed this Agreement as of the [•] day of [•], 2015.

	
					
	CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.

	 
	 
	 
	 
	 

	By:
	 
	 
	 
	 

	 
	Name:
	 
	 
	 

	 
	Title:
	 
	 
	 

	 
	 
	 
	 
	 

	GRANTEE

	 
	 
	 
	 
	 

	Signed:
	 
	 
	 
	 

	 
	[•]
	 
	 
	 

    

3

Annex A
Performance-Based Vesting Conditions
		
	1.
	For purposes of this Agreement, the following definitions shall apply:

“Confirmation” shall mean a determination of the Committee of cumulative OIBDA and cumulative FCF that have been achieved in respect of any applicable Performance Period and the amount of any Award earned as of the Second Anniversary Early Vesting Date, the Third Anniversary Early Vesting Date or the Final Vesting Date, which confirmation shall be issued as soon administratively feasible following the end of the applicable Performance Period and in no event later than the Second Anniversary Early Vesting Date, the Third Anniversary Early Vesting Date or the Final Vesting Date, as applicable. The determination of the Committee shall be final and binding. 
“FCF” shall mean Free Cash Flow, which is defined as cash flows from operating activities, less purchases of property, plant and equipment, net of disposals of property, plant and equipment and excludes the cash impact of certain unusual or infrequent items that are not included in costs charged in arriving at OIBDA. FCF for any applicable Performance Period shall be calculated as of December 31 for each year of the applicable Performance Period using exchange rates from the Company’s 2015 budget.
“Four-Year Performance Period” shall mean the period from January 1, 2015 through December 31, 2018. 
“OIBDA” includes amortization and impairment of program rights and is determined as operating income / loss before depreciation, amortization of intangible assets, impairments of assets and certain unusual or infrequent items that are not considered by our chief operating decision makers when evaluating our performance (which unusual or infrequent items shall correspond to items excluded from OIBDA in the Company’s Annual Report on Form 10-K for the corresponding year of the applicable Performance Period). OIBDA for any applicable Performance Period shall be calculated as of December 31 for each year of the applicable Performance Period using exchange rates from the Company’s 2015 budget.
“Performance Period” means any of the Two-Year Performance Period, the Three-Year Performance Period or the Four-Year Performance Period, as applicable.
“Second Anniversary Target FCF” means the cumulative amount of FCF for the Two-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs.
“Second Anniversary Target OIBDA” means the cumulative amount of OIBDA for the Two-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs.
“Target FCF” means the cumulative amount of FCF for the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to the Target FCF Award.
“Target FCF Maximum” means the cumulative amount of FCF for the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to 200% of the Target FCF Award.
“Target FCF Minimum” means the cumulative amount of FCF for the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to 50% of the Target FCF Award.
“Target FCF Award” means [•] PRSUs, representing 50% of the Target.
“Target OIBDA” means the cumulative amount of OIBDA for  the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to  the Target OIBDA Award.
“Target OIBDA Maximum” means the cumulative amount of OIBDA for the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to 200% of the Target OIBDA Award.
“Target OIBDA Minimum” means the cumulative amount of OIBDA for the Four-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs that correlates to 50% of the Target OIBDA Award.
“Target OIBDA Award” means [•] PRSUs, representing 50% of the Target.
“Third Anniversary Target FCF” means the cumulative amount of FCF for the Three-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs.
“Third Anniversary Target OIBDA” means the cumulative amount of OIBDA for the Three-Year Performance Period that is established by the Committee at the time it approves the grant of PRSUs.
“Three-Year Performance Period” shall mean the period from January 1, 2015 through December 31, 2017.
“Two-Year Performance Period” shall mean the period from January 1, 2015 through December 31, 2016.
“Total Award” means the amount of the Target OIBDA Award based on the level of cumulative OIBDA achieved for the Four-Year Performance Period and the amount of the Target FCF Award based on the level of cumulative FCF achieved for the Four-Year Performance Period earned on the Final Vesting Date.
“Vesting Date” means any of the Second Anniversary Early Vesting Date, the Third Anniversary Early Vesting Date or the Final Vesting Date (in each case as defined below), as applicable.

		
	2.
	Subject to Sections 2(b), (c) and (d) of this Agreement and the receipt of Confirmation, the Award will become vested on March 13, 2019 (the “Final Vesting Date”) as follows:

		
	a.
	200% of the Target OIBDA Award will vest if the Company has achieved the Target OIBDA Maximum; 

		
	b.
	200% of the Target FCF Award will vest if the Company has achieved the Target FCF Maximum; 

		
	c.
	100% of the Target OIBDA Award will vest if the Company has achieved Target OIBDA;

		
	d.
	100% of the Target FCF Award will vest if the Company has achieved the Target FCF;

		
	e.
	50% the Target OIBDA Award will vest if the Company has achieved the Target OIBDA Minimum;

		
	f.
	50% of the Target FCF Award will vest if the Company has achieved the Target FCF Minimum; 

		
	g.
	0% of the Target OIBDA Award will vest on the Final Vesting Date if the Company has achieved less than the Target OIBDA Minimum; and

		
	h.
	0% of the Target FCF Award will vest on the Final Vesting Date if the Company has achieved less than the Target FCF Minimum;

provided, that the percentage of the Target OIBDA Award that will vest in the event cumulative OIBDA as of the end of the Four-Year Performance Period is between the Target OIBDA Maximum and the Target OIBDA or between the Target OIBDA and the Target OIBDA Minimum and the percentage of the Target FCF Award that will vest in the event the cumulative FCF as of the end of  the Four-Year Performance Period is between the Target FCF Maximum and the Target FCF or between the Target FCF and the Target FCF Minimum will be determined by interpolating on a straight-line basis; and provided, further that the amount of the Total Award that will vest on the Final Vesting Date will be reduced by the amount of the Award that vests on the Second Anniversary Early Vesting Date and the Third Anniversary Early Vesting Date (if any).
		
	3.
	Subject to Sections 2(b), (c) and (d) of this Agreement and receipt of Confirmation and notwithstanding anything to the contrary herein, an amount of 25% of Target (representing [•] PRSUs) will vest on March 13, 2017 (the “Second Anniversary Early Vesting Date”) if and only to the extent the Company has achieved both (i) the Second Anniversary Target OIBDA and (ii) the Second Anniversary Target FCF. 

		
	4.
	Subject to Sections 2(b), (c) and (d) of this Agreement and receipt of Confirmation and notwithstanding anything to the contrary herein, 25% of Target (representing [•] PRSUs) will vest on March 13, 2018 (the “Third Anniversary Early Vesting Date”) if and only to the extent the Company has achieved both (i) the Third Anniversary Target OIBDA and (ii) the Third Anniversary Target FCF.

		
	5.
	In the event 25% of Target (representing [•] PRSUs) becomes vested on the Second Anniversary Early Vesting Date pursuant to clause 3 above, then the Total Award shall be reduced by such number of PRSUs, provided, that the Total Award is not less than zero.  In the event 25% of Target (representing [•] PRSUs) is vested on the Third Anniversary Early Vesting Date pursuant to clause 4 above, then the Total Award shall be reduced by such number of PRSUs, provided, that the Total Award is not less than zero.  For the avoidance of doubt, any PRSUs that vest on the Second Anniversary Early Vesting Date or the Third Anniversary Early Vesting Date will not be affected or subject to adjustment based on the size of the Total Award.

		
	6.
	Any PRSUs that do not vest as of the Final Vesting Date and which have not previously been forfeited pursuant to the terms of this Agreement will automatically terminate as of the Final Vesting Date and shall immediately be forfeited to the Company without payment of any consideration for the PRSUs, and the Grantee will have no further right, title or interest in or to such PRSUs or the underlying shares of Class A Common Stock.

		
	7.
	In the event of a financing or corporate transaction that has a material impact on OIBDA or FCF that is not contemplated in the Company’s 2015 budget, the Compensation Committee may determine in its sole discretion in good faith a reasonable adjustment to the cumulative OIBDA or the cumulative FCF for any applicable Performance Period.

*   *   *   *   *

Annex B
Effect of a Change of Control or Time Warner Transaction

		
	1.
	For purposes of this Agreement, the following definitions shall apply:

“Change of Control” means:
(i)    the consummation of any amalgamation, consolidation or merger of the Company pursuant to which the shareholders of the Company immediately prior to the amalgamation, merger or consolidation do not constitute, immediately after the amalgamation, consolidation or merger, the beneficial owners (within the meaning of Rule 13d-3 under the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of 50% or more of the voting power of the then outstanding securities of the Company (or the surviving entity) generally entitled to vote in the election of directors; provided, that any amalgamation, consolidation, merger or other business combination effected solely to change the domicile of the Company shall not constitute a Change of Control; 
(ii)    the occurrence of an event the result of which is that any “person” or “group” of related persons (as defined in Section 13(d) and 14(d)(2) of the Exchange Act), becomes the beneficial owner, directly or indirectly, of securities representing more than 50% of the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors;
(iii)    the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company and its Affiliates to an unaffiliated third party or the liquidation or dissolution of the Company; or 
(iv)    a change in the composition of the Board in any two-year period, such that a majority of the members of the Board are not (A) persons who were directors at the beginning of such period or (B) persons who are elected, or nominated for election, to the Board by an affirmative vote of the majority of the such directors (but shall not include an individual whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors to the Board);
provided, however, that (I) a Change of Control shall not include a Time Warner Transaction, and (II) for purposes of any Award or subplan that may constitute deferred compensation within the meaning of Code section 409A, the Committee, in its discretion, may specify a different definition of Change of Control in order to comply with or cause an Award to be exempt from the provisions of Code section 409A.
“Delisting Event” means an event or circumstance in connection with or following a Time Warner Transaction whereby the Company is no longer publicly traded with its shares of Class A common stock listed on the NASDAQ Global Market. 
“Disposition Event” means any sale or disposition in connection with or following a Time Warner Transaction or pursuant to the exercise of consent rights by Time Warner in effect from time to time as a result of which the Company ceases to own a material portion of its assets.
“Employment Contract” means the employment contract dated [•] between the Grantee and CME Media Services Limited, as amended, amended and restated, otherwise modified or superseded from time to time. 
[“Good Reason” means a material breach of the Employment Contract by CME Media Services Limited which results in the termination of the Employment Contract by the Grantee pursuant to clause [•] thereof.]
“Qualifying Termination Event” means a termination of the Grantee’s employment with the Company or any Affiliate (i) [by the Grantee for Good Reason, (ii)] by the Company or such Affiliate which is not a Termination for Cause, provided, that such termination by the Company or such Affiliate occurs within twelve months of a Time Warner Transaction, or (iii) by the Company or such Affiliate which is not a Termination for Cause, provided, that such termination by the Company or such Affiliate occurs within twelve months of either a Delisting Event or a Disposition Event.
“Termination for Cause” shall have the meaning assigned to it in clause [•] of the Employment Contract.
“Time Warner Transaction” means (i) any transaction or event (including the exercise of conversion rights under any convertible security) the result of which is that Time Warner Inc.  becomes the beneficial owner, directly or indirectly, of securities (including any securities attributed to it as part of a group under Section 13(d) of the Exchange Act) representing more than 50% of the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors; or (ii) the consummation of any amalgamation, consolidation or merger of the Company pursuant to which the shareholders of the Company immediately prior to the amalgamation, merger or consolidation do not constitute, immediately after the amalgamation, consolidation or merger, the beneficial owners (within the meaning of Rule 13d-3 under the Exchange Act) of 50% or more of the voting power of the then outstanding securities of the Company (or the surviving entity) generally entitled to vote in the election of directors; provided, that Time Warner Inc. is the beneficial owner of 20% of the voting power of the then outstanding securities of the Company (or the surviving entity) generally entitled to vote in the election of directors following such amalgamation, consolidation or merger.  For the avoidance of doubt, in the event Time Warner Inc. is the beneficial owner of less than 20% of the voting power of the then outstanding securities of the Company (or the surviving entity) generally entitled to vote in the election of directors following such amalgamation, consolidation or merger, such transaction shall constitute a Change of Control.
		
	2.
	In the event of a Change of Control, the performance conditions for awards of Performance Restricted Stock Units that have not previously vested will lapse and an amount equal to (i) the number of PRSUs determined  in accordance with clause 2 of Annex A based on a performance level that would result from (A) the sum of the cumulative actual OIBDA for each fiscal year of the Four-Year Performance Period completed prior to the Change of Control and  the amount of Target OIBDA for each fiscal year of the Four-Year Performance Period that was not completed prior to the Change of Control, plus (B) the sum of the cumulative actual FCF for each fiscal year of the Four-Year Performance Period completed prior to the Change of Control and the amount of Target FCF for each fiscal year of the Four-Year Performance Period that was not completed prior to the Change of Control, minus (ii) the amount of PRSUs that have vested on the Second Anniversary Early Vesting Date and the Third Anniversary Early Vesting Date, if either has occurred prior to the Change of Control, will fully vest immediately prior to such Change of Control.

		
	3.
	In the event of a Time Warner Transaction and the Company continues to be publicly traded with its shares of Class A common stock listed on the NASDAQ Global Market, the PRSUs granted hereunder will continue to vest in accordance with the performance conditions set out in Annex A until the earliest to occur of (i) the Final Vesting Date, (ii) a Qualifying Termination Event, (iii) subject to clause 4 below, a Delisting Event, or (iv) subject to clause 4 below, a Disposition Event.

In connection with a Qualifying Termination Event, the performance conditions for awards of Performance Restricted Stock Units that have not previously vested will lapse and an amount equal to (i) the number of PRSUs determined  in accordance with clause 2 of Annex A based on a performance level that would result from (A) the sum of the cumulative actual OIBDA for each fiscal year of the Four-Year Performance Period completed prior to such Qualifying Termination Event and the amount of Target OIBDA for each fiscal year of the Four-Year Performance Period that was not completed prior to the Qualifying Termination Event, plus (B) the sum of the cumulative actual FCF for each fiscal year of the Four-Year Performance Period completed prior to the Qualifying Termination Event and  the amount of Target FCF for each fiscal year of the Four-Year Performance Period that was not completed prior to the Qualifying Termination Event  minus (ii) the amount of PRSUs that have vested on the Second Anniversary Early Vesting Date and the Third Anniversary Early Vesting Date (if any) will fully vest immediately prior to such Qualifying Termination Event.
		
	4.
	In connection with a Delisting Event or a Disposition Event, the performance conditions for awards of Performance Restricted Stock Units that have not previously vested will lapse and an amount equal to (i) the number of PRSUs determined in accordance with clause 2 of Annex A based on a performance level that would result from (A) the sum of the cumulative actual OIBDA for each fiscal year of the Four-Year Performance Period completed prior to such Delisting Event or Disposition Event and  the amount of Target OIBDA for each fiscal year of the Four-Year Performance Period that was not completed prior to such Delisting Event or Disposition Event, plus (B) the sum of the cumulative actual FCF for each fiscal year of the Four-Year Performance Period completed prior to such Delisting Event or Disposition Event and the amount of Target FCF for each fiscal year of the Four-Year Performance Period that was not completed prior to such Delisting Event or Disposition Event  minus (ii) the amount of PRSUs that have vested on the Second Anniversary Early Vesting Date and the Third Anniversary Early Vesting Date (if any) will fully vest immediately prior to such Delisting Event or Disposition Event.

*   *   *   *   *2015 Q1 10Q_EX 10.3

• Original Plan approved by the Corporate Governance and Nominating Committee on March 23, 2004, by the Board of Directors on March 23, 2004 and by the Stockholders on May 18, 2004
• The Plan was amended and restated, and approved by the Corporate Governance and Nominating Committee on July 26, 2005 and by the Board of Directors on July 26, 2005
• The Plan was subsequently amended and restated by the Governance, Compensation and Nominating Committee on November 18, 2008 and by the Board of Directors on November 18, 2008
The Plan was again amended and restated by the Governance, Compensation and Nominating Committee, effective May 15, 2014 and by the Board of Directors, effective May 15, 2014

COMERICA INCORPORATED 
AMENDED AND RESTATED INCENTIVE PLAN 
FOR 
NON-EMPLOYEE DIRECTORS 

(EFFECTIVE MAY 15, 2014)

COMERICA INCORPORATED 
AMENDED AND RESTATED INCENTIVE PLAN  
FOR NON-EMPLOYEE DIRECTORS
(EFFECTIVE MAY 15, 2014)
TABLE OF CONTENTS
	
			
	SECTION I
	PURPOSE
	1

	SECTION II
	DEFINITIONS
	1

	SECTION III
	ADMINISTRATION
	4

	SECTION IV
	COMMON STOCK SUBJECT TO THE PLAN
	5

	SECTION V
	AWARDS
	5

	SECTION VI
	CHANGE OF CONTROL PROVISIONS
	11

	SECTION VII
	TERMINATION AND AMENDMENT
	12

	SECTION VIII
	UNFUNDED STATUS OF PLAN
	13

	SECTION IX
	GENERAL PROVISIONS
	14

	SECTION X
	EFFECTIVE DATE OF PLAN
	15

COMERICA INCORPORATED
AMENDED AND RESTATED INCENTIVE PLAN
FOR NON-EMPLOYEE DIRECTORS
(EFFECTIVE MAY 15, 2014)
SECTION I
PURPOSE
The purpose of this Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors is to promote the continued prosperity of Comerica Incorporated by aligning the financial interests of the recipients of awards hereunder with those of the stockholders of Comerica Incorporated, to provide an additional incentive for such individuals to remain as directors, and to provide a means through which Comerica Incorporated may attract well-qualified individuals to serve as directors.
This Plan was previously amended and restated to comply with Internal Revenue Code ("Code") Section 409A and the Regulations and other interpretive authorities promulgated thereunder with respect to Awards earned or vested on or after January 1, 2005, and Awards earned and vested prior to January 1, 2005 that are materially modified after October 3, 2004.
This Plan was amended and restated again, effective December 31, 2008, to reflect changes in guidance promulgated under Code Section 409A and to reflect the Plan's administration.
Finally, this Plan was amended and restated again, effective May 15, 2014, to extend the termination date to July 31, 2014.
SECTION II     
DEFINITIONS 
For purposes of this Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors, the following terms are defined as set forth below: 
A.    "Affiliate" means (i) any entity that is controlled by the Corporation, whether directly or indirectly, or (ii) any entity in which the Corporation has a significant equity interest, as determined by the Committee.
B.    "Aggregated Plan" means all agreements, methods, programs, and other arrangements sponsored by the Corporation that would be aggregated with this Plan under Section 1.409A-1(c) of the Regulations.
C.    "Award" means an Option Award, a Stock Appreciation Right Award, a Restricted Stock Award, a Restricted Stock Unit Award or any Other Equity-Based Award.

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D.    "Award Agreement" means a written document setting forth the terms and conditions of an Award.
E.    "Beneficiary Designation Form" means the form used to designate the Participant's beneficiary(ies) to whom any amounts payable in the event of the Participant's death are to be paid and by whom any rights of the Participant, after the Participant's death, may be exercised, as such form may be modified by the Committee from time to time.
F.    "Board" means the Board of Directors of the Corporation.
G.    "Change of Control" shall have the meaning set forth in Exhibit A to this Plan.
H.    "Code" means the Internal Revenue Code of 1986, as amended.
I.    "Committee" means the Governance, Compensation and Nominating Committee or such other committee of the Board as the Board may from time to time designate.
J.    "Common Stock" means common stock, par value $5.00 per share, of the Corporation.
K.    "Corporation" means Comerica Incorporated, a Delaware corporation.
L.    "Date of Grant" means the effective date of an Award granted by the Committee to an Award Recipient.
M.    "Disability" means any medically determinable physical or mental impairment of any person(s) who is unable to engage in any substantial gainful activity which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. 
N.    "Eligible Director" means any individual serving as a member of the Board who is not an employee of the Corporation or any of its Subsidiaries or Affiliates.
O.    "Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time, and any successor thereto.
P.    "Fair Market Value" means, as of any given date, the closing price of Common Stock on the New York Stock Exchange, Inc. on that date, or if the Common Stock was not traded on the New York Stock Exchange, Inc. on such date, then on the last preceding date on which the Common Stock was traded.  If Fair Market Value for any date in question cannot be determined as provided above, then Fair Market Value shall be determined by the Committee, provided that the Committee uses a reasonable valuation method in accordance with the Regulations and applicable guidance promulgated under Code Section 409A.

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Q.    "Option" means a right to purchase a specified number of shares of Common Stock during a specified period pursuant to such terms as are determined by the Committee and as may be set forth in the applicable Award Agreement.
R.    "Option Award" means an Award granted under Section V(A)(1).
S.    "Other Equity-Based Award" means an Award granted under Section V(A)(5).
T.    "Participant" means any individual who has received an Award.
U.    "Plan" means the Comerica Incorporated Amended and Restated Incentive Plan for Non-Employee Directors, as set forth herein and as hereinafter amended and/or restated from time to time.
V.    "Regulations" means the Treasury Regulations promulgated under the Code.
W.    "Restricted Stock" means shares of Common Stock that are subject to certain conditions and restrictions, as determined by the Committee and as may be set forth in the applicable Award Agreement.
X.    "Restricted Stock Award" means an Award granted under Section V(A)(3).
Y.    "Restricted Stock Unit" or "Unit" means a unit equivalent to a share of Common Stock that is subject to certain conditions and restrictions, as determined by the Committee and as may be set forth in the applicable Award Agreement.
Z.    "Restricted Stock Unit Award" means an Award granted under Section V(A)(4).
AA.    "Retirement" means the date of the next annual shareholder's meeting of the Corporation immediately following the Director's 70th birthday.  
BB.    "Section" means, unless otherwise specified, a Section of the Plan.
CC.    “Separation from Service” means the date on which the Director ceases to be a director of the Corporation; provided that a Separation from Service shall not have occurred if the Corporation anticipates that the Director will continue to provide services to the Corporation or a Subsidiary, whether as an employee or consultant or in any other compensatory capacity.  The determination of whether a Separation from Service has occurred shall be made by the Committee in accordance with Section 1.409A-1(h) of the Treasury Regulations, or such other guidance with respect to Code Section 409A that may be in effect on the date of determination.  
DD.    "Stock Appreciation Right" means a right to receive payment in shares of Common Stock equal to the excess of the Fair Market Value of a specified number of shares of Common Stock on the date the Stock Appreciation Right is exercised (or, if 

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the Committee shall so determine, at any time during a specified period before or after the date of exercise) over the grant price of the Stock Appreciation Right as specified by the Committee, which price shall not be less than the Fair Market Value of the same number of shares of Common Stock on the date(s) of grant of the Stock Appreciation Right.
EE.    "Stock Appreciation Right Award" means an Award granted under Section V(A)(2).
FF.    "Subsidiary" means any corporation, partnership or other entity, 50% or more of whose stock or interest is owned, directly or indirectly, by the Corporation.
SECTION III     
ADMINISTRATION
A.    The Plan shall be administered by the Committee; provided, that the Board shall have the authority to exercise any and all duties and responsibilities assigned to the Committee under the Plan.  Among other things, the Committee shall have the authority, subject to the terms of the Plan, to determine the type or types of Award(s), if any, to be granted to an Eligible Director, to grant Awards to Eligible Directors, to determine the number of shares of Common Stock or Units to be covered by each such Award and otherwise to determine the terms and conditions thereof, and to amend such terms and conditions at any time and from time to time.  Awards may be granted singly or in any combination.  Awards granted under the Plan shall be evidenced by Award Agreements that set forth the terms and conditions for the respective Award, which may include, among other things, the provisions applicable in the event the Participant's membership on the Board terminates.  The Committee may, but need not, require the execution by a Participant of any such Award Agreement.  Acceptance of the Award by the respective Participant shall constitute acceptance of the terms and conditions of the Award, including, without limitation, those set forth in the Award Agreement and the Plan.
B.    The Committee shall have the authority to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable, to interpret the terms and provisions of the Plan and any Award issued under the Plan (and any Award Agreement relating thereto) and to otherwise supervise the administration of the Plan.  This includes the power and authority to comply with the withholding and reporting requirements of Code Section 409A and any interpretive authorities promulgated thereunder.  
C.    Determinations of the Committee shall be made by a majority vote of its members at a meeting at which a quorum is present or pursuant to a unanimous written consent of its members.
D.    The Committee may delegate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it; provided, that no 

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such delegation may be made that would cause Awards or other transactions under the Plan to cease to be exempt from Section 16(b) of the Exchange Act or that is prohibited by applicable law or the applicable rules of the New York Stock Exchange, Inc. (or the applicable rules of such other securities exchange as may at the time of the delegation be the principal market for the Common Stock).  Any such delegation may be revoked by the Committee at any time.
E.    Any determination made by the Committee or pursuant to delegated authority under the provisions of the Plan with respect to any Award shall be made in the sole and absolute discretion of the Committee or its delegate at the time of the grant of the Award or, unless in contravention of an express term of the Plan, at any time thereafter.  All decisions made by the Committee or any appropriate delegate pursuant to the provisions of the Plan shall be final and binding on all persons, including the Corporation, Participants, beneficiaries and other interested parties.
SECTION IV     
COMMON STOCK SUBJECT TO THE PLAN
A.    The maximum number of shares of Common Stock that may be delivered under the Plan shall be 500,000.  Shares issued pursuant to the Plan may be authorized and unissued shares, treasury shares, shares purchased in the open market or in private transactions, or any combination of the foregoing.
B.    If an Award is forfeited or cancelled, an Option or Stock Appreciation Right terminates, expires or lapses without being exercised or an Award is settled in cash rather than shares of Common Stock, the shares of Common Stock that had been subject thereto shall again be available for distribution in connection with Awards under the Plan.  Notwithstanding anything in this Section IV(B) to the contrary, Options, Restricted Stock and Stock Appreciation Right Awards must be settled in Common Stock. 
C.    In the event the number of outstanding shares of Common Stock changes as a result of any stock split, stock dividend, recapitalization, merger, consolidation, reorganization, combination, or exchange of shares, split up, split off, spin off, liquidation or other similar change in capitalization, or any distribution made to holders of Common Stock other than cash dividends, the number or kind of shares that may be issued under the Plan, and the number or kind of shares subject to, or the exercise price per share under any outstanding Award, shall be automatically adjusted, and the Committee shall make such other equitable adjustments, if applicable, of any Award or shares of Common Stock issuable pursuant thereto so that the value of the interest of the individual shall not be decreased by reason of the occurrence of such event, provided that the aggregate exercise price of the Award is not less than the aggregate exercise price of the Award before the change in capitalization.  Any such adjustment shall be deemed conclusive and binding on the Corporation, each Participant, their beneficiaries and all other interested parties. 

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SECTION V     
AWARDS
A.    Types of Awards
1.    Option Awards.  The Committee may grant Option Awards to Eligible Directors in accordance with the provisions of this subsection, subject to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine to be appropriate.  Options granted under the Plan shall be non-qualified stock options.  
a.    Exercise Price.  The exercise price per share of Common Stock of an Option shall not be less than the Fair Market Value of a share of Common Stock on the Date of Grant.
b.    Option Term.  The term of an Option shall not exceed ten years from the Date of Grant.
c.    Methods of Exercise.  Subject to the provisions of the applicable Award Agreement, an Option may be exercised, in whole or in part, by giving written notice of exercise to the Corporation specifying the number of shares of Common Stock subject to the Option to be purchased, subject to such procedures as established by the Committee from time to time.  Prior to settlement of any such exercise, the exercise price shall be satisfied in full in accordance with Section V(C). 
d.    Rights upon Exercise.  A Participant shall have all of the rights of a stockholder with respect to the shares purchased upon exercise of an Option when the Participant has given written notice of exercise, has paid in full for such shares and, if requested, has given the representation described in Section VIII(A).
2.    Stock Appreciation Right Awards.  The Committee may grant Stock Appreciation Right Awards to Eligible Directors, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine to be appropriate, including, without limitation, the term, manner of exercise, dates of exercise, and the grant price; provided, however, that such grant price may never be less than the Fair Market Value of Common Stock on the date the right is granted.  Notwithstanding any contrary provision in the Plan, upon exercise, the settlement of a Stock Appreciation Right may only occur by payment of Common Stock; Stock Appreciation Rights cannot be settled with cash or any other form of payment.
3.    Restricted Stock Awards.  The Committee may grant Restricted Stock Awards to Eligible Directors in accordance with the provisions of this subsection, subject to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine to be appropriate.  

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a.    Awards and Certificates.  Shares of Restricted Stock shall be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or the issuance of one or more stock certificates.  Any certificate issued in respect of shares of Restricted Stock shall be registered in the name of such Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Award, substantially in the following form:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE COMERICA INCORPORATED AMENDED AND RESTATED INCENTIVE PLAN FOR NON-EMPLOYEE DIRECTORS AND AN AWARD AGREEMENT.  COPIES OF SUCH PLAN AND THE APPLICABLE AWARD AGREEMENT ARE ON FILE AT THE OFFICES OF COMERICA INCORPORATED AT COMERICA BANK TOWER, 1717 MAIN STREET, MC 6506, DALLAS, TEXAS 75201.
The Committee may require that the certificates evidencing such shares be held in custody by the Corporation until the restrictions thereon shall have lapsed and that, as a condition of any Restricted Stock Award, the Participant shall have delivered a stock power, endorsed in blank, relating to the Common Stock covered by such Award.
b.    Rights of Holder of Restricted Stock.  Except as provided in this Section V(A)(3) and the applicable Award Agreement, a Participant to whom Restricted Stock is granted shall have all of the rights of a stockholder of the Corporation with respect to the Common Stock subject to the Restricted Stock Award, including, if applicable, the right to vote the shares and the right to receive any dividends and other distributions.  
4.    Restricted Stock Unit Awards.  The Committee may grant Restricted Stock Unit Awards to Eligible Directors, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine to be appropriate including, without limitation, the time or times at which Restricted Stock Units will be granted, the number of shares to be represented by each such grant, the conditions for vesting thereof, the time or times within which Restricted Stock Units may be subject to forfeiture, the time or times at which Restricted Stock Units will be settled and the form of such settlement (i.e., cash or shares of Common Stock).
a.    Restricted Stock Units.  A Restricted Stock Unit shall represent an unfunded, unsecured right to receive one share of the Corporation's Common Stock.  

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b.    Rights of Holder of Restricted Stock Units.  A Participant to whom Restricted Stock Units are granted shall not have any rights of a stockholder of the Corporation with respect to the Common Stock represented by the Restricted Stock Unit Award.  If so determined by the Committee, in its sole and absolute discretion, Restricted Stock Units may include a dividend equivalent right, pursuant to which the Participant will either receive cash amounts (either paid currently or on a contingent basis) equivalent to the dividends and other distributions payable with respect to the number of shares of Common Stock represented by the Restricted Stock Units, or additional Restricted Stock Units representing such dividends and other distributions.  
5.    Other Equity-Based Awards.  The Committee may grant Other Equity-Based Awards to Eligible Directors in accordance with the provisions of this Section V(A) and subject to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine.  Other Equity-Based Awards may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, Common Stock (including, without limitation, securities convertible into Common Stock), as are deemed by the Committee to be consistent with the purpose of the Plan; provided, however, that such grants and settlements of such Awards must comply with applicable law, including Code Section 409A and any interpretive authority promulgated thereunder.  Other Equity-Based Awards may be granted either alone or in conjunction with other Awards granted under the Plan.
B.    Deferring Awards.  Under no circumstances may a Participant elect to defer, until a time or times later than the exercise of an Option or a Stock Appreciation Right or the settlement or distribution of shares in respect of other Awards, receipt of all or a portion of the shares of Common Stock subject to such Award, or dividends payable thereon, and/or to receive cash at such later time or times in lieu of such deferred shares.
C.    Forms of Payment by Participants.  Subject to the terms of the Plan and of any applicable Award Agreement, payments to be made by a Participant upon the exercise or vesting of an Award may be made in such form or forms as the Committee shall determine, provided that Stock Appreciation Right Awards must always be paid out in Common Stock.
D.    Limits on Transfer of Awards.  Unless otherwise determined by the Committee, no Award and no right under any such Award shall be transferable by a Participant otherwise than by will or by the laws of intestacy; provided, however, that a Participant may, in accordance with Section IX(E) and in the manner established by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any property payable or distributable with respect to any Award upon the death of the Participant.  Each Award or right under any Award shall be exercisable during the Participant's lifetime only by the Participant or, if permissible under applicable law, by the Participant's guardian or legal representative.  Unless otherwise determined by the 

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Committee, no Award or right under any such Award may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable against the Corporation or any Subsidiary or Affiliate.  
E.    Term of Awards.  Subject to any specific provisions of the Plan, the term of each Award shall be for such period as may be determined by the Committee.
F.    Securities Law Restrictions.  All certificates for shares of Common Stock or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such restrictions as the Committee may deem advisable under the Plan, or the rules, regulations and other requirements of the Securities and Exchange Commission, the New York Stock Exchange, Inc., any other exchange on which shares of Common Stock may be eligible to be traded or any applicable federal or state securities laws, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions.
G.    Termination of Board Service as a Result of Death, Disability, or Retirement of Director.  Unless otherwise determined by the Committee, if a Participant's membership on the Board is terminated by the Participant's death, Disability or Retirement, then on the date the Participant's membership is so terminated: 
1.    Any Options and Stock Appreciation Rights granted to such Participant that are outstanding as of the date the Participant's membership is so terminated and which are not then exercisable and vested, shall become fully vested and shall be exercisable for the remainder of the original Option or Stock Appreciation Right term.
2.    The restrictions applicable to any Restricted Stock granted to such Participant shall lapse, and such Restricted Stock shall become free of all restrictions and become fully vested and transferable to the full extent of the original grant.
3.    All Restricted Stock Units granted to such Participant shall be considered to be fully vested and, with respect to Restricted Stock Units that are not subject to Code Section 409A, such Restricted Stock Units shall be settled in cash as promptly as is practicable and, with respect to Restricted Stock Units that are subject to Code Section 409A, such Restricted Stock Units shall be settled in cash at the time provided in the applicable Award Agreement.  
4.    All Other Equity-Based Awards granted to such Participant shall become fully vested and, with respect to Other Equity-Based Awards that are not subject to Code Section 409A, shall be settled in cash as promptly as is practicable and, with respect to Other Equity-Based Awards that are subject to Code Section 409A, shall be settled in cash at the time provided in the applicable Award Agreement. 

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H.    Other Termination of Board Service.  Unless otherwise determined by the Committee, and in accordance with Code Section 409A and any interpretive authority promulgated thereunder, if a Participant's membership on the Board is terminated for any reason other than death, Disability or Retirement as provided in Section V(G), any outstanding Awards held by the Participant that are unvested on such date of termination shall be immediately forfeited and cancelled, and any outstanding Option or Stock Appreciation Right held by the Participant that is vested but unexercised as of the date of termination shall be exercisable for a period of ninety days after such termination or until the expiration date of the Option or Stock Appreciation Right, as the case may be, whichever date occurs earlier.
I.    Awards Subject to Code Section 409A.  If the Committee determines that an Award is subject to Section 409A of the Code, then the Award shall be settled at the time or times designated in the applicable Award Agreement, subject to the following provisions:
1.    Payments Upon Occurrence of Stated Events.  Notwithstanding any provision in this Plan or an Award Agreement to the contrary, with respect to any Award that was granted prior to the Effective Date of this Plan and that is subject to Code Section 409A, payment or settlement of such Award upon a "termination of employment" or "separation from service" shall require a Separation from Service, as such term is defined in Section II of this Plan.  In addition, payment or settlement of such Award upon a "Change of Control" or "Disability" shall require a Change of Control or Disability, as such terms are defined in Section II of this Plan.
2.    Period of Payment or Settlement.  Notwithstanding any provision in this Plan (other than this Section V.I.) or an Award Agreement to the contrary, with respect to any Award that was granted prior to the Effective Date of this Plan and is subject to Code Section 409A, the terms of which provide for payment or settlement upon the occurrence of a specified event (such as a Change of Control or the death or Disability of the Award Recipient), payment or settlement of such Award shall be made within the thirty (30) day period following the date on which such event occurs.  With respect to any Award that is granted on or after the Effective Date of this Plan and is subject to Code Section 409A, the terms of which provide for payment or settlement upon the occurrence of a specified event, payment or settlement of such Award shall be made within the ninety (90) day period, or such shorter period set forth in the Award Agreement, following the date on which such event occurs. 
3.    Distribution in the Event of Income Inclusion Under Code Section 409A.  If an Award fails to meet the requirements of Section 409A of the Code, the Participant may receive payment in connection with the Award before the Award would otherwise be paid, provided, however, that the amount paid to the Participant shall not exceed the lesser of: (i) the amount payable under such Award, or (ii) the amount to be reported pursuant to Section 409A of the Code on the applicable Form W-2 (or Form 1099) as taxable income to the Participant.

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4.    Delay for Insolvency or Compelling Business Reasons.  In the event the Corporation determines that the making of any payment of benefits on the date specified under an Award would jeopardize the ability of the Corporation to continue as a going concern, the Committee may delay the payment of benefits until the first calendar year in which the Corporation notifies the Committee that the payment of benefits would not have such effect.
5.    Administrative Delay in Payment.  In the case of administrative necessity, the payment of benefits under an Award may be delayed up to the later of the last day of the calendar year in which payment would otherwise be made or the 15th day of the third calendar month following the date on which payment would otherwise be made.  Further, if, as a result of events beyond the control of the Participant (or following the Participant's death, the Participant's beneficiary), it is not administratively practicable for the Committee to calculate the amount of benefits due to the Participant as of the date on which payment would otherwise be made, the payment may be delayed until the first calendar year in which calculation of the amount is administratively practicable.  
6.    No Participant Election.  Notwithstanding the foregoing provisions, if the period during which payment of benefits under an Award will be made occurs, or will occur, in two calendar years, the Participant shall not be permitted to elect the calendar year in which the payment shall be made.
SECTION VI     
CHANGE OF CONTROL PROVISIONS
Notwithstanding any other provision of the Plan to the contrary, in the event of a Change of Control:
1.    Any Options and Stock Appreciation Rights outstanding as of the date such Change of Control is determined to have occurred, and which are not then exercisable and vested, shall become fully vested and shall be exercisable for the remainder of the original Option or Stock Appreciation Right term.
2.    The restrictions applicable to any Restricted Stock shall lapse, and such Restricted Stock shall become free of all restrictions and become fully vested and transferable to the full extent of the original grant.
3.    All Restricted Stock Units shall be considered to be fully vested, and such Restricted Stock Units shall be settled in cash within the ninety (90) day period, or such shorter period set forth in the Award Agreement, following the date of the Change of Control.
4.    All Other Equity-Based Awards shall vest and be exercisable, or shall vest and be settled in cash within the ninety (90) day period, or such shorter period set forth in the Award Agreement, following the date of the Change of Control.

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5.    The Committee may also make additional adjustments and/or settlements of outstanding Awards as it deems appropriate and consistent with the Plan's purposes, but only to the extent that such adjustments and/or settlements occur in accordance with Code Section 409A, the Regulations and any other interpretive authority promulgated thereunder. 
SECTION VII     
TERMINATION AND AMENDMENT
A.    The Plan will terminate on July 31, 2014.  Under the Plan, Awards outstanding as of such date shall not be affected or impaired by the termination of the Plan.
B.    The Committee or the Board may amend, alter or discontinue the Plan at any time, but no amendment, alteration or discontinuance shall be made which would adversely impact the rights of a Participant under any Award theretofore granted without the Participant's consent, except such an amendment made to comply with applicable law, including Code Section 409A and any interpretive authorities promulgated thereunder, stock exchange rules or accounting rules.  In addition, no such amendment shall be made without the approval of the Corporation's stockholders to the extent such approval is required by applicable law or the applicable rules of the New York Stock Exchange, Inc. (or the applicable rules of such other securities exchange as may at the time be the principal market for the Common Stock).  
C.    The Committee may amend the terms of any Option or other Award theretofore granted, prospectively or retroactively; provided, however, that no such amendment shall adversely impact the rights of any Participant without the Participant's consent except such an amendment made to cause the Plan or Award to comply with applicable law, including Code Section 409A and any interpretive authorities promulgated thereunder, stock exchange rules or accounting rules; and provided, further, that in no event may an Option or other Award be repriced without the approval of the stockholders of the Corporation except due to an adjustment pursuant to Section IV(C).  Furthermore, no amendment may be made to an Option Award or a Stock Appreciation Right Award which would cause the exercise price or the grant price (as applicable) to be less than the Fair Market Value of the Common Stock on the Date of Grant, except as provided in Section IV(C). 
D.    Subject to the above provisions and unless prohibited by applicable law, including Code Section 409A and any interpretive authorities promulgated thereunder, or the applicable rules of the New York Stock Exchange, Inc. (or the applicable rules of such other securities exchange as may at the time be the principal market for the Common Stock), the Committee or the Board shall have authority to amend the Plan to take into account changes in law and tax and accounting rules, as well as other developments, and to grant Awards which qualify for beneficial treatment under such rules without stockholder approval. 

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E.    Upon termination of the Plan, the Corporation may settle any outstanding Award that is not subject to Code Section 409A as soon as is practicable following such termination and may settle any outstanding Award that is subject to Code Section 409A in accordance with one of the following:
1.    the termination and liquidation of the Plan within twelve (12)  months of a complete dissolution of the Corporation taxed under Section 331 of the Code or with the approval of a bankruptcy court pursuant to 11 U.S.C. § 503(b)(1)(A); provided that the amounts deferred under this Plan are included in the Participants' gross incomes in the latest of the following years (or, if earlier, the taxable year in which the amount is actually or constructively received): (i) the calendar year in which the Plan is terminated; (ii) the first calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the payment is administratively practicable.  

2.    the termination and liquidation of the Plan pursuant to irrevocable action taken by the Committee or the Corporation within the thirty (30) days preceding or the twelve (12) months following a Change of Control; provided that all Aggregated Plans are terminated and liquidated with respect to each Participant that experienced the Change of Control, so that under the terms of the termination and liquidation, all such Participants are required to receive all amounts of deferred compensation under this Plan and any other Aggregated Plans within twelve (12) months of the date the Committee or the Corporation irrevocably takes all necessary action to terminate and liquidate this Plan and the Committee or the Corporation, as the case may be, takes all necessary action to terminate and liquidate such other Aggregated Plans;
3.    the termination and liquidation of the Plan, provided that: (i) the termination and liquidation does not occur proximate to a downturn in the Corporation's financial health; (2) the Committee or the Corporation, as the case may be, terminates and liquidates all Aggregated Plans; (3) no payments in liquidation of this Plan are made within twelve (12) months of the date the Committee or the Corporation irrevocably takes all necessary action to terminate and liquidate this Plan, other than payments that would be payable under the terms of this Plan if the action to terminate and liquidate this Plan had not occurred; (4) all payments are made within twenty four (24) months of the date on which the Committee or the Corporation irrevocably takes all action necessary to terminate and liquidate this Plan; and (5) the Corporation does not adopt a new Aggregated Plan at any time within three (3) years following the date on which the Committee or the Corporation irrevocably takes all action necessary to terminate and liquidate the Plan.

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SECTION VIII     
UNFUNDED STATUS OF PLAN
It is presently intended that the Plan will constitute an "unfunded" plan.  The Committee may authorize the creation of rabbi trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provided, however, that unless the Committee otherwise determines, the existence of such rabbi trusts or other arrangements is consistent with the "unfunded" status of the Plan.
SECTION IX     
GENERAL PROVISIONS
A.    The Committee may require each person purchasing or receiving shares pursuant to an Award to represent to and agree with the Corporation in writing that such person is acquiring the shares without a view to the distribution thereof.  The certificates for such shares may include any legend which the Committee deems appropriate to reflect any restrictions on transfer.
B.    Notwithstanding any other provision of the Plan or Award Agreements made pursuant thereto, with respect to any Award other than an Award that is subject to Code Section 409A, the Corporation shall not be required to evidence book-entry registration of shares of Common Stock under the Plan or issue or deliver any certificate or certificates for shares under the Plan prior to fulfillment of all of the following conditions:  (i) listing or approval for listing upon notice of issuance, of such shares on the applicable stock exchange; (ii) any registration or other qualification of such shares of the Corporation under any state or Federal law or regulation, or the maintaining in effect of any such registration or other qualification which the Committee shall, in its absolute discretion upon the advice of counsel, deem necessary or advisable; and (iii) obtaining any other consent, approval, or permit from any state or Federal governmental agency which the Committee shall, in its absolute discretion after receiving the advice of counsel, determine to be necessary or advisable, and, with respect to any Award that is subject to Code Section 409A, the Corporation shall not be required to issue or deliver any certificate or certificates for shares under the Plan if the Corporation reasonably anticipates that such issuance or delivery would violate applicable Federal securities laws or other applicable law, provided the Corporation issues or delivers the shares at the earliest date on which the Corporation reasonably anticipates that such issuance or delivery would not cause such violation.
C.    Nothing contained in the Plan shall prevent the Corporation or any Subsidiary or Affiliate from adopting other or additional compensation arrangements for its directors.
D.    Adoption of the Plan shall not confer upon any Eligible Director any right to continued service on the Board.

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E.    Upon becoming a Participant of the Plan, each Eligible Director shall submit to Comerica Incorporated, Human Resources - Compensation, Comerica Bank Tower, 1717 Main Street, MC 6515, Dallas, Texas 75201 (or to such other unit or person as designated by the Committee from time to time) a Beneficiary Designation Form designating one or more beneficiaries to whom any Awards payable or distributable in the event of the Participant's death are to be paid or distributed, or by whom any rights of the Participant, after the Participant's death, may be exercised.  A Beneficiary Designation Form will be effective only if it is signed by the Participant and submitted before the Participant's death.  Any subsequent Beneficiary Designation Form properly submitted will supersede any previous Beneficiary Designation Form so submitted.  If a Participant designates a spouse as a beneficiary, such designation shall automatically terminate and be of no effect following the divorce of the Participant and such individual, unless ratified in writing post-divorce.
If the primary beneficiary shall predecease the Participant or the primary beneficiary and the Participant die in a common disaster under such circumstances that it is impossible to determine who survived the other, the Participant's Awards remaining at the time of the Participant's death shall be paid or distributed to the alternate beneficiary(ies) who survive(s) the Participant in accordance with this Plan and the applicable Award Agreement.  If there are no alternate beneficiaries living or in existence at the date of the Participant's death, or if the Participant has not submitted a valid Beneficiary Designation Form to the Corporation, the remaining Awards shall be distributed or paid in accordance with the terms of the Plan and the Award Agreement to the legal representative for the benefit of the Participant's estate.  
F.    The Plan and all Awards made and actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Delaware, unless preempted by federal law, and also in accordance with Code Section 409A and any interpretive authorities promulgated thereunder.  
SECTION X     
EFFECTIVE DATE OF PLAN
This Plan was originally effective as of May 18, 2004 (the "Effective Date").  This Plan was amended and restated effective July 26, 2005 and, thereafter, it was further amended and restated effective December 31, 2008 and effective May 15, 2014.

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EXHIBIT A
 
CHANGE OF CONTROL
A.    For the purpose of this Plan, a "Change of Control" shall mean:
		
	1.
	The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of common stock of the Corporation (the "Outstanding Corporation Common Stock") or (ii) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the "Outstanding Corporation Voting Securities"); provided, however, that for purposes of this subsection 1, the following acquisitions shall not constitute a Change of Control:  (i) any acquisition directly from the Corporation, (ii) any acquisition by the Corporation, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any corporation controlled by the Corporation or (iv) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection A.3 of this Exhibit A; or

		
	2.
	Individuals who, as of the date hereof, constitute the Corporation's Board of Directors (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Corporation's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

		
	3.
	Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the Corporation's assets (a "Business Combination"), in each case, unless, following such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the company resulting from such Business 

16

Combination (including, without limitation, a corporation which as a result of such transaction owns the Corporation or all or substantially all of the Corporation's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Corporation or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the company resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of directors of the company resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or
		
	4.
	Approval by the Corporation's stockholders of a complete liquidation or dissolution of the Corporation.

		
	B.
	With respect to any Award subject to Section 409A of the Code and for purposes of subsection E. of Section VII above, the above definition of "Change of Control" shall mean: 

		
	1.
	any one person, or more than one person acting as a group, acquires ownership of stock of the Corporation that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Corporation; 

		
	2.
	any one person, or more than one person acting as a group, acquires (or has acquired during any twelve (12) month period) ownership of stock of the Corporation possessing 30% or more of the total voting power of the stock of the Corporation;

		
	3.
	a majority of the members of the Board is replaced during any twelve (12) month period by directors whose appointment is not endorsed by a majority of the members of the Board before the date of the appointment or election; or

		
	4.
	any one person, or more than one person acting as a group, acquires (or has acquired during any twelve (12) month period) assets from the Corporation that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Corporation immediately before such acquisition or acquisitions.

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The determination of whether a Change of Control has occurred under this Section B of Exhibit A shall be made by the Committee in accordance with the provisions of Code Section 409A and the Regulations promulgated thereunder.

18

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