Document:

dex10v

PERSONAL and CONFIDENTIAL
February 13, 2013         
                        
First Name Last Name

Dear First Name:

Dear First Name:

We are pleased to inform you that as an XLT member, you will be receiving a performance stock units (PSUs) award in 2013.  We use these awards to reward performers who we believe will be key contributors to our growth well into the future.  

You have been awarded x,xxx PSUs.  The number of PSUs actually earned will be dependent upon Stryker's financial performance during the three-year period ending December 31, 2015, with the number with respect to 50% of the PSUs being based on our Adjusted EPS Growth and the remaining 50% of the PSUs being based on our relative Sales Growth.  In order to earn any of the PSUs, you must be continuously employed with Stryker through the vesting date of March 21, 2016 except as otherwise provided in the Terms and Conditions.

You will be required to “Accept” the award online via the UBS One Source website located at
 www.ubs.com/onesource/SYK between March 5 and March 31, 2013.  The detailed terms of the PSUs are set forth in the applicable Terms and Conditions and any applicable country addendum and the provisions of the Company's 2011 Long-Term Incentive Plan.  Those documents, together with the related Prospectuses, are available on the UBS One Source website and you should read them before accepting the awards.  We suggest that you retain hard copies of this letter and the Terms and Conditions and any applicable country addendum as evidence of the award of the PSUs to you.  

Thank you for your strong performance and I look forward to your future contributions toward positioning Stryker for long-term success.

Sincerely,
	
	
	/s/ KEVIN A. LOBO

	Kevin A. Lobo, President and Chief Executive Officer (Principal Executive Officer)

STRYKER CORPORATION

TERMS AND CONDITIONS
RELATING TO PERFORMANCE STOCK UNITS GRANTED
PURSUANT TO THE 2011 LONG-TERM INCENTIVE PLAN

1.    The Performance Stock Units with respect to Common Stock of Stryker Corporation (the “Company”) granted to you during 2013 (the “PSUs”) are subject to the terms and conditions set forth herein (the “Terms and Conditions”) and all of the terms and conditions of the Stryker Corporation 2011 Long-Term Incentive Plan, as amended (the “2011 Plan”), which is incorporated herein by reference.  In the case of a conflict between these Terms and Conditions and the terms of the 2011 Plan, the provisions of the 2011 Plan will govern. Capitalized terms used but not defined herein have the meaning provided therefor in the 2011 Plan.  For purposes of these Terms and Conditions, “Stryker” or “Employer” means the Company or any Subsidiary that employs you on the applicable date.

2.    Vesting.  Except as provided in Section 6, the vesting of your PSUs is dependent upon your remaining continuously employed with Stryker through March 21, 2016 (the “Vesting Date”) as well as upon the Company's financial performance during the three-year period ending December 31, 2015 (the “Performance Period”).  Specifically, the vesting of 50% of the PSUs (the “EPS PSUs”) is dependent upon Adjusted EPS Growth as set forth in Section 3, and the vesting of the remaining 50% of the PSUs (the “Sales Growth PSUs”) is dependent upon the Sales Growth Percentile Ranking as set forth in Section 4.  

3.    Adjusted EPS Growth.

(a)    If you have remained in the continuous employment of Stryker through the Vesting Date, you shall become vested in the percentage of the EPS PSUs determined based on the Company's Adjusted EPS Growth using the table below, applying straight line interpolation rounded to the nearest whole number of EPS PSUs for Adjusted EPS Growth between 50% and 100% or between 100% and 200%.

	
					
	 
	< Minimum
	Minimum
	Target
	Maximum

	Adjusted EPS Growth
	Less than 6.0%
	6%
	8.5%
	11% or more

	Vested Percent of EPS PSUs
	—%
	50%
	100%
	200%

Any EPS PSUs that do not become vested in accordance with the foregoing shall be forfeited.

(b)    As soon as administratively practicable following the Vesting Date (but in no event later than December 31, 2016), the Company shall issue you the Shares underlying the vested EPS PSUs. 

(c)    For purposes of this Agreement:
(i)    “Adjusted EPS” for a calendar year shall mean the Company's  diluted net earnings per share for such year as determined under U.S. generally accepted accounting principles (“GAAP”) but subject to such adjustments, if any, for non-GAAP financial measures that are reflected in a reconciliation to the GAAP financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

(ii)    “Adjusted EPS Growth” shall mean the sum of the Annual Percentage Change in Adjusted EPS for the three (3) calendar years in the Performance Period divided by three (3).
(iii)    “Annual Percentage Change in Adjusted EPS” for a calendar year shall mean the amount by which the Adjusted EPS for such calendar year has increased or decreased relative to the immediately preceding calendar year, expressed as a positive or negative percentage (depending on whether Adjusted EPS increased or decreased) of the Adjusted EPS for such preceding calendar year.  
(d)    Notwithstanding anything to the contrary herein, the Committee shall have discretion to make such adjustments to the foregoing metrics as it deems appropriate to reflect the impact of corporate transactions, accounting or tax law changes or extraordinary, unusual, nonrecurring or infrequent items; provided, however, that in no case shall such adjustments have the net aggregate effect of increasing Adjusted EPS Growth.
4.    Sales Growth Percentile Ranking.

(a)    If you have remained in the continuous employment of Stryker through the Vesting Date, you shall become vested in the percentage of the Sales Growth PSUs based upon the Company's Sales Growth Percentile Ranking, as determined using the table below, applying straight line interpolation rounded to the nearest whole number of Sales Growth PSUs for Sales Growth Percentile Ranking between 50% and 100% or between 100% and 200%.

	
					
	Sales Growth Percentile Ranking
	86th and Above
	62nd
	33rd
	Below 33rd

	Vested Percent of Sales Growth PSUs
	200%
	100%
	50%
	—%

Any Sales Growth PSUs that do not become vested in accordance with the foregoing shall be forfeited, and if the Company's Average Sales Growth in the Performance Period is equal to or less than zero, all of the Sales Growth PSUs shall be forfeited (irrespective of the Sales Growth Percentile Ranking).  

(b)    As soon as administratively practicable following the Vesting Date (but in no event later than December 31, 2016), the Company shall issue you the Shares underlying the vested Sales Growth PSUs. 

(c)    For purposes of this Agreement:
(i)    “Average Sales Growth” shall mean, for the Company and each company in the Comparison Group, the sum of the Sales Growth for each Reporting Period ending within the Performance Period divided by three;
(ii)    “Comparison Group” shall mean:
		
	▪
	Abbott Laboratories

		
	▪
	ArthroCare Corporation

		
	▪
	CR Bard Inc.

		
	▪
	Baxter International Inc.

		
	▪
	Becton, Dickinson and Co.

		
	▪
	Biomet, Inc.

		
	▪
	Boston Scientific Corporation

		
	▪
	CareFusion Corporation

		
	▪
	Conmed Corporation

		
	▪
	Covidien plc

		
	▪
	General Electric (Healthcare)

		
	▪
	Hill-Rom Holdings, Inc.

		
	▪
	Intuitive Surgical, Inc.

		
	▪
	Johnson & Johnson

		
	▪
	Medtronic, Inc.

		
	▪
	Nuvasive, Inc.

		
	▪
	Smith & Nephew plc

		
	▪
	St. Jude Medical Inc.

		
	▪
	Thermo Fisher Scientific, Inc.

		
	▪
	Wright Medical Group, Inc.

		
	▪
	Zimmer Holdings, Inc.

For purposes of the foregoing, any company for which Sales Growth cannot be calculated for three full annual Reporting Periods ending within the Performance Period shall be excluded.
(iii)    “Net Sales” shall mean, for the Company and each company in the Comparison Group, net sales for the applicable Reporting Period as determined under U.S. generally accepted accounting principles and as reported in an Annual Report on Form 10-K or a Quarterly Report of Form 10-Q (or the comparable reports filed by foreign issuers) filed with the Securities and Exchange Commission.
(iv)    “Reporting Period” shall mean a calendar year in the case of the Company and each company in the Comparison Group that reports on a calendar year basis, and in the case of any other company in the Comparison Group, the four fiscal quarters that include the last fiscal quarter ending prior to December 31 for which such company has filed an Annual Report on Form 10-K or a Quarterly Report on Form 10-Q (or the comparable reports filed by foreign issuers) with the Securities and Exchange Commission prior to the following February 28.
(v)    “Sales Growth” for a Reporting Period shall mean the amount by which Net Sales has increased or decreased relative to the immediately preceding Reporting Period, expressed as a positive or negative percentage (depending on whether Net Sales increased or decreased) of the Net Sales for such preceding Reporting Period.
(vi)    “Sales Growth Percentile Ranking” shall mean the percentile ranking of the Company's Average Sales Growth relative to the Average Sales Growth for each company in the Comparison Group, rounded to the whole nearest percentile.  For this purpose, the percentile ranking shall be calculated as 1 - (Rank-1)/(Total of the Comparison Group plus the Company-1).  For example, if the Company ranked 5th out of 22 companies including itself, the percentile rank would be calculated as 1 - (5-1)/(22-1) or 1 - (4/21) or 1-.1905 or the 81st percentile.
  
5.    Dividend Equivalents.  In connection with your Award, you shall be entitled to receive all of the cash dividends that are or would be payable with respect to each Share underlying your PSUs (“Dividend Equivalents”).  Dividend Equivalents shall be converted into their equivalent number of PSUs based on the Fair Market Value of a Share on the applicable dividend payment date.  Such PSUs shall be subject to the terms and conditions applicable to the PSUs to which the Dividend Equivalents relate, including, without limitation, the vesting, forfeiture, and payment form and timing provisions contained herein.  

6.    In the event you cease to remain in the continuous employment of the Company or a Subsidiary for the entire period commencing on the Date of Grant and ending on the applicable Vesting Date, your right to receive the Shares issuable pursuant to the PSUs shall be only as follows:
    
         (a)    If you cease to be an Employee prior to the Vesting Date by reason of Disability (as such term is defined in the 2011 Plan or required under a foreign law that is applicable to you because you are a foreign national or are employed outside the United States, or both, at that time) or death, you or your estate will become immediately vested in a pro-rata portion (determined by dividing (a) the number of days during the Performance Period in which you were an Employee by (b) the total number of days during the Performance Period) of your PSUs based upon the Company's Adjusted EPS Growth and Sales Growth Percentile Ranking.  Adjusted EPS Growth shall be determined in accordance with Section 3, except that only calendar year 2013 and, if you remain an Employee through December 31, 2014, calendar year 2014, shall be taken into account, and except that the denominator in determining Adjusted EPS Growth shall be one (if only calendar year 2013 is taken into account) or two (if both 2013 and 2014 are taken into account).  The Sales Growth Percentile Ranking shall be determined in accordance with Section 4, except that the only Reporting Periods taken into account shall be (i) Reporting Periods ending after December 31, 2012 and before January 1, 2014, and (ii) if you cease to be an Employee after December 31, 2014, Reporting Periods ending after December 31, 2013 and before January 1, 2015, and except that the denominator in determining Average Sales Growth shall be one (if the preceding clause (ii) does not apply) or two (if the preceding clause (ii) does apply).  You, your legal representative or your estate will receive all of the underlying Shares attributable to the vested PSUs as soon as administratively practicable following (and in no event more than ninety (90) days after the later of December 31, 2013 or the date you cease to be an Employee.

(b)    If you cease to be an Employee for any reason other than those provided in (a) above and your Termination Date is prior to the Vesting Date, you shall immediately forfeit all PSUs granted hereunder effective as of your Termination Date.  If you are a resident of or employed in the United States, “Termination Date” shall mean the effective date of termination of your employment with your Employer. If you are resident or employed outside of the United States, “Termination Date” shall mean the earliest of (i) the date on which notice of termination is provided to you, (ii) the last day of your active service with your Employer, or (iii) the last day on which you are an Employee of your Employer, as determined in each case without including any required advance notice period and irrespective of the status of the termination under local labor or employment laws. 

(c)    If you are resident and/or employed in a country that is a member of the European Union, the grant of the PSUs and these Terms and Conditions are intended to comply with the age discrimination provisions of the EU Equal Treatment Framework Directive, as implemented into local law (the “Age Discrimination Rules”).  To the extent that a court or tribunal of competent jurisdiction determines that any provision of the Terms and Conditions are invalid or unenforceable, in whole or in part, under the Age Discrimination Rules, the Company, in its sole discretion, shall have the power and authority to revise or strike such provision to the minimum extent necessary to make it valid and enforceable to the full extent permitted under local law.

7.    Notwithstanding the foregoing, the Company may, in its sole discretion, settle the PSUs (and any Dividend Equivalents) in the form of: (i) a cash payment to the extent settlement in Shares (1) is prohibited under local law, (2) would require you or the Company and/or your Employer to obtain the approval of any governmental and/or regulatory body in your country of residence (and country of employment, if different), or (3) is administratively burdensome; or (ii) Shares, but require you to immediately sell such Shares (in which case, the Company shall have the authority to issue sales instructions in relation to such Shares on your behalf).     

8.    The number of Shares subject to the PSUs shall be subject to adjustment and the vesting dates hereof may be accelerated as follows:

(a)    In the event that the Shares, as presently constituted, shall be changed into or exchanged for a different number or kind of shares of stock or other securities of the Company or of another corporation (whether by reason of merger, consolidation, recapitalization, reclassification, split-up, combination of shares, or otherwise) or if the number of such Shares shall be increased through the payment of a stock dividend or a dividend on the Shares of rights or warrants to purchase securities of the Company shall be made, then there shall be substituted for or added to each Share theretofore subject to the PSUs the number and kind of shares of stock or other securities into which each outstanding Share shall be so changed, or for which each such Share shall be exchanged, or to which each such Share shall be entitled.  The other terms of the PSUs shall also be appropriately amended as may be necessary to reflect the foregoing events.  In the event there shall be any other change in the number or kind of the outstanding Shares, or of any stock or other securities into which such Shares shall have been exchanged, then if the Committee shall, in its sole discretion, determine that such change equitably requires an adjustment in the PSUs, such adjustment shall be made in accordance with such determination.

(b)    Fractional Shares resulting from any adjustment in the PSUs may be settled in cash or otherwise as the Committee shall determine.  Notice of any adjustment will be given to you and such adjustment (whether or not such notice is given) shall be effective and binding for all purposes hereof.

(c)    The Committee shall have the power to amend the PSUs to permit the immediate vesting of the PSUs (and to terminate any unvested PSUs) and the distribution of the underlying Shares prior to the effectiveness of (i) any disposition of substantially all of the assets of the Company or your Employer, (ii) the shutdown, discontinuance of operations or dissolution of the Company or your Employer, or (iii) the merger or consolidation of the Company or your Employer with or into any other unrelated corporation. 

9.    If you are resident or employed outside of the United States, you agree, as a condition of the grant of the PSUs, to repatriate all payments attributable to the Shares and/or cash acquired under the 2011 Plan (including, but not limited to, dividends and any proceeds derived from the sale of the Shares acquired pursuant to the PSUs) in accordance with local foreign exchange rules and regulations in your country of residence (and country of employment, if different).  In addition, you also agree to take any and all actions, and consent to any and all actions taken by the Company and its Subsidiaries, as may be required to allow the Company and its Subsidiaries to comply with local laws, rules and regulations in your country of residence (and country of employment, if different).  Finally, you agree to take any and all actions as may be required to comply with your personal legal and tax obligations under local laws, rules and regulations in your country of residence (and country of employment, if different).

10.    Regardless of any action the Company and/or your Employer take with respect to any income tax (including U.S. federal, state and local taxes or non-U.S. taxes), social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), you acknowledge that the ultimate liability for all Tax-Related Items legally due by you is and remains your responsibility and that the Company and your Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the PSUs, including the grant of the PSUs, the vesting of the PSUs, the subsequent sale of any Shares acquired pursuant to the PSUs and the receipt of any dividends or dividend equivalents and (ii) do not commit to structure the terms of the grant or any aspect of the PSUs to reduce or eliminate your liability for Tax-Related Items.

Prior to the delivery of Shares upon the vesting of your PSUs, if your country of residence (and/or the country of employment, if different) requires withholding of Tax-Related Items, the Company shall 

withhold a sufficient number of whole Shares otherwise issuable upon the vesting of the PSUs that have an aggregate Fair Market Value sufficient to pay the minimum Tax-Related Items required to be withheld with respect to the Shares.  In cases where the Fair Market Value of the number of whole Shares withheld is greater than the minimum Tax-Related Items required to be withheld, the Company shall make a cash payment to you equal to the difference as soon as administratively practicable.  The cash equivalent of the Shares withheld will be used to settle the obligation to withhold the Tax-Related Items.  Alternatively, your Employer may withhold the minimum Tax-Related Items required to be withheld with respect to the Shares in cash from your regular salary and/or wages, or any other amounts payable to you.  In the event the withholding requirements are not satisfied through the withholding of Shares by the Company or through your regular salary and/or wages or other amounts payable to you by your Employer, no Shares will be issued to you (or your estate) upon vesting of the PSUs unless and until satisfactory arrangements (as determined by the Board of Directors) have been made by you with respect to the payment of any Tax-Related Items that the Company or your Employer determines, in its sole discretion, must be withheld or collected with respect to such PSUs.  By accepting this grant of PSUs, you expressly consent to the withholding of Shares and/or withholding from your regular salary and/or wages or other amounts payable to you as provided for hereunder.  All other Tax-Related Items related to the PSUs and any Shares delivered in payment thereof are your sole responsibility.

The PSUs are intended to be exempt from the requirements of Code Section 409A. The 2011 Plan and these Terms and Conditions shall be administered and interpreted in a manner consistent with this intent. If the Company determines that these Terms and Conditions are subject to Code Section 409A and that it has failed to comply with the requirements of that Section, the Company may, at the Company's sole discretion and without your consent, amend these Terms and Conditions to cause them to comply with Code Section 409A or be exempt from Code Section 409A. 

11.    If you were required to sign the “Stryker Confidentiality, Intellectual Property, Non-Competition and Non-Solicitation Agreement” or a similar agreement in order to receive the PSUs or have previously signed such an agreement and you breach any non-competition, nonsolicitation or nondisclosure provision or provision as to ownership of inventions contained therein at any time while employed by the Company or a Subsidiary, or during the one-year period following termination of employment, any unvested PSUs shall be rescinded and you shall return to the Company all Shares that were acquired upon vesting of the PSUs that you have not disposed of.  Further, you shall pay to the Company an amount equal to the profit realized by you (if any) on all Shares that were acquired upon vesting of the PSUs that you have disposed of.  For purposes of the preceding sentence, the profit shall be the Fair Market Value of the Shares at the time of disposition.

12.    The PSUs shall be transferable only by will or the laws of descent and distribution.  If you shall purport to make any transfer of the PSUs, except as aforesaid, the PSUs and all rights thereunder shall terminate immediately.

13.    The PSUs shall not be vested in whole or in part, and the Company shall not be obligated to issue any Shares subject to the PSUs, if such issuance would, in the opinion of counsel for the Company, violate the Securities Act of 1933 or any other U.S. federal, state or non-U.S. statute having similar requirements as it may be in effect at the time.  The PSUs are subject to the further requirement that, if at any time the Board of Directors shall determine in its discretion that the listing or qualification of the Shares subject to the PSUs under any securities exchange requirements or under any applicable law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition of or in connection with the issuance of Shares pursuant to the PSUs, the PSUs may not be vested in whole or in part unless such listing, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board of Directors.

14.    The grant of the PSUs shall not confer upon you any right to continue in the employ of your Employer nor limit in any way the right of your Employer to terminate your employment at any time.  You shall have no rights as a shareholder of the Company with respect to any Shares issuable upon the vesting of the PSUs until the date of issuance of such Shares.

15.     You acknowledge and agree that the 2011 Plan is discretionary in nature and may be amended, cancelled or terminated by the Company, in its sole discretion, at any time.  The grant of the PSUs under the 2011 Plan is a one-time benefit and does not create any contractual or other right to receive a grant of PSUs or any other award under the 2011 Plan or other benefits in lieu thereof in the future.  Future grants, if any, will be at the sole discretion of the Company, including, but not limited to, the form and timing of any grant, the number of Shares subject to the grant and the vesting provisions.  Any amendment, modification or termination of the 2011 Plan shall not constitute a change or impairment of the terms and conditions of your employment with your Employer.

16.    Your participation in the 2011 Plan is voluntary.  The value of the PSUs and any other awards granted under the 2011 Plan is an extraordinary item of compensation outside the scope of your employment (and your employment contract, if any).  Any grant under the 2011 Plan, including the grant of the PSUs, is not part of normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension, or retirement benefits or similar payments.

17.    These Terms and Conditions shall bind and inure to the benefit of the Company, its successors and assigns and you and your estate in the event of your death.
    
18.    The Company and your Employer hereby notify you of the following in relation to your personal data and the collection, processing and transfer of such data in relation to the grant of the PSUs and your participation in the 2011 Plan pursuant to applicable personal data protection laws.  The collection, processing and transfer of your personal data is necessary for the Company's administration of the 2011 Plan and your participation in the 2011 Plan, and your denial and/or objection to the collection, processing and transfer of personal data may affect your ability to participate in the 2011 Plan.  As such, you voluntarily acknowledge, consent and agree (where required under applicable law) to the collection, use, processing and transfer of personal data as described herein.  
    
The Company and your Employer hold certain personal information about you, including (but not limited to) your name, home address and telephone number, date of birth, social security number or other employee identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of all PSUs or any other entitlement to Shares awarded, canceled, purchased, vested, unvested or outstanding in your favor for the purpose of managing and administering the 2011 Plan (“Data”).  The Data may be provided by you or collected, where lawful, from third parties, and the Company and your Employer will process the Data for the exclusive purpose of implementing, administering and managing your participation in the 2011 Plan.  The data processing will take place through electronic and non-electronic means according to logics and procedures strictly correlated to the purposes for which the Data is collected and with confidentiality and security provisions as set forth by applicable laws and regulations in your country of residence.  Data processing operations will be performed minimizing the use of personal and identification data when such operations are unnecessary for the processing purposes sought.  The Data will be accessible within the Company's organization only by those persons requiring access for purposes of the implementation, administration and operation of the 2011 Plan and for your participation in the 2011 Plan.

The Company and your Employer will transfer Data as necessary for the purpose of implementation, administration and management of your participation in the 2011 Plan, and the Company and your Employer 

may each further transfer Data to any third parties assisting the Company in the implementation, administration and management of the 2011 Plan.  These recipients may be located in the European Economic Area, the United States or elsewhere throughout the world.  You hereby authorize (where required under applicable law) the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for purposes of implementing, administering and managing your participation in the 2011 Plan, including any requisite transfer of such Data as may be required for the administration of the 2011 Plan and/or the subsequent holding of Shares on your behalf to a broker or other third party with whom you may elect to deposit any Shares acquired pursuant to the 2011 Plan.  

You may, at any time, exercise your rights provided under applicable personal data protection laws, which may include the right to (a) obtain confirmation as to the existence of the Data, (b) verify the content, origin and accuracy of the Data, (c) request the integration, update, amendment, deletion or blockage (for breach of applicable laws) of the Data and (d) oppose, for legal reasons, the collection, processing or transfer of the Data that is not necessary or required for the implementation, administration and/or operation of the 2011 Plan and your participation in the 2011 Plan.  You may seek to exercise these rights by contacting your local HR manager.

19.    The grant of the PSUs is not intended to be a public offering of securities in your country of residence (and country of employment, if different).  The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under local law).  

20.    All questions concerning the construction, validity and interpretation of the PSUs and the 2011 Plan shall be governed and construed according to the laws of the state of Michigan, without regard to the application of the conflicts of laws provisions thereof.  Any disputes regarding the PSUs or the 2011 Plan shall be brought only in the state or federal courts of the state of Michigan.

21.    The Company may, in its sole discretion, decide to deliver any documents related to the PSUs or other awards granted to you under the 2011 Plan by electronic means.  You hereby consent to receive such documents by electronic delivery and agree to participate in the 2011 Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

22.    If you are resident outside of the United States, you acknowledge and agree that it is your express intent that these Terms and Conditions, the 2011 Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the PSUs be drawn up in English.  If you have received these Terms and Conditions, the 2011 Plan or any other documents related to the PSUs translated into a language other than English and the meaning of the translated version is different than the English version, the English version will control.  

23.    Notwithstanding any provisions of these Terms and Conditions to the contrary, the PSUs shall be subject to any special terms and conditions for your country of residence (and country of employment, if different) set forth in an addendum to these Terms and Conditions (an “Addendum”).  Further, if you transfer your residence and/or employment to another country reflected in an Addendum to these Terms and Conditions at the time of transfer, the special terms and conditions for such country will apply to you to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the 2011 Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate your transfer).  In all circumstances, any applicable Addendum shall constitute part of these Terms and Conditions.

24.    The Company reserves the right to impose other requirements on the PSUs, any Shares acquired pursuant to the PSUs and your participation in the 2011 Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law or to facilitate the operation and administration of the award and the 2011 Plan.  Such requirements may include (but are not limited to) requiring you to sign any agreements or undertakings that may be necessary to accomplish the foregoing.

*          *          *          *          *STI-12.31.12-EX10.23

Exhibit 10.23
    

SunTrust Banks, Inc.
2009 Stock Plan
    
RORWA Performance-vested
Restricted Stock Unit Agreement

SunTrust Banks, Inc. (“SunTrust”), a Georgia corporation, pursuant to action of the Compensation Committee (“Committee”) of its Board of Directors and in accordance with the SunTrust Banks, Inc. 2009 Stock Plan (“Plan”), has granted restricted stock units (the “Restricted Stock Units”) as an incentive for the Grantee to promote the interests of SunTrust and its Subsidiaries. Each Restricted Stock Unit represents the right to receive a share of SunTrust Common Stock, $1.00 par value, at a future date and time, subject to the terms of this Restricted Stock Unit Agreement (this “Grant”).
 
	
			
	 
	 
	 

	Name of Grantee
	 
	_[Name]____________________________

	 
	 

	Number of Restricted Stock Units
	 
	_[# of Shares]_____

	 
	 

	Grant Date
	 
	_[Grant Date]_________________________

This Restricted Stock Unit Agreement (the “Unit Agreement”) evidences this Grant, which has been made subject to all the terms and conditions set forth on the attached Terms and Conditions and in the Plan.
 
	
		
	 
	 

	

	SUNTRUST BANKS, INC.

	 
	 

	 
	 

	

	Authorized Officer

1

§1. EFFECTIVE DATE. This grant of Restricted Stock Units to the Grantee is effective as of [Grant Date] (the “Grant Date”).
§2. DEFINITIONS. Whenever the following terms are used in this Unit Agreement, they shall have the meanings set forth below. Capitalized terms not otherwise defined in this Unit Agreement shall have the same meanings as in the Plan.
(a) Change in Control - means a “Change in Control” as defined in §2.2 of the SunTrust Banks, Inc. 2009 Stock Plan.
(b) Change in Control Agreement - means a change in control agreement by and between SunTrust and the Grantee.
(c) Code - means the Internal Revenue Code of 1986, as amended.
 (d) Disability - means the Grantee is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Grantee's employer and, in addition, has begun to receive benefits under SunTrust's Long-Term Disability Plan.
(e) Dividend Equivalent Right - means a right that entitles the Grantee to receive an amount equal to any dividends paid on a share of Stock, which dividends have a record date between the Grant Date and the date the Vested Units are paid; provided, however, the amount of any Dividend Equivalent Rights on unvested Restricted Stock Units shall be treated as reinvested in additional shares of Stock on the date such dividends are paid. 
(f) Key Employee - means an employee treated as a “specified employee” as of his Separation from Service under Code §409A(a)(2)(B)(i) (i.e., a key employee (as defined in Code §416(i) without regard to §(5) thereof)) if the common stock of SunTrust or an affiliate (any member of SunTrust's controlled group, as determined under Code §414(b), (c), or (m)) is publicly traded on an established securities market or otherwise. Key Employees shall be determined in accordance with Code §409A using a December 31 identification date. A listing of Key Employees as of an identification date shall be effective for the twelve (12) month period beginning on the April 1 following the identification date.
(g) Performance Period(s) - means the three (3) periods commencing January 1, 2013 and ending December 31, 2013; January 1, 2014 and ending December 31, 2014; and January 1, 2015 and ending December 31, 2015.
(h) Retirement - means the voluntary termination of employment by the Grantee from SunTrust or its Subsidiaries on or after attaining age 55 and completing five (5) or more years of service as determined in accordance with the terms of the SunTrust Banks, Inc. Retirement Plan, as amended from time to time (the “Retirement Plan”). For purposes of this Unit Agreement, Grantee who is vested in the Retirement Plan benefit but terminates employment before attaining age 55 or completing at least five (5) years of service is not eligible for Retirement.
(i) Return on Risk Weighted Assets or RORWA - means annual net income available to common shareholders of SunTrust divided by Average Risk Weighted Assets of SunTrust for the applicable year. In the event SunTrust is merged with or into another entity prior to the end of the Performance Period, then “Return on Risk Weighted Assets” shall mean the annual net income available to common shareholders of the surviving corporation divided by average risk weighted assets of the surviving corporation for the applicable year.
(j) Risk Weighted Assets - means average risk weighted assets determined under Basel I and, if applicable, as reported to the Federal Reserve in SunTrust's FR Y-9C (Consolidated Financial Statements for Bank Holding Companies).
(k) Separation from Service - means a “separation from service” within the meaning of Code §409A.
(l) Stock means the common stock of SunTrust Banks, Inc. and any successor.
(m) Termination for Cause or Terminated for Cause - means a termination of employment which is made primarily because of (i) the Grantee's willful and continued failure to perform his job duties in a satisfactory manner after written notice from SunTrust to Grantee and a thirty (30) day period in which to cure such failure, (ii) the Grantee's conviction of a felony or engagement in a dishonest act, misappropriation of funds, embezzlement, criminal conduct or common law fraud, (iii) the Grantee's material violation of the Code of Business Conduct and Ethics of SunTrust or the Code of Conduct of a Subsidiary, (iv) the Grantee's engagement in an act that materially damages or materially prejudices SunTrust or any Subsidiary or the Grantee's engagement in activities materially damaging to the property, business or reputation of SunTrust or any Subsidiary; or (v) the Grantee's failure and refusal to comply in any material respect with the current and any future amended policies, standards and regulations of SunTrust, any Subsidiary and their regulatory agencies, if such failure continues after written notice from SunTrust to the Grantee 

2

and a thirty (30) day period in which to cure such failure, or the determination by any such governing agency that the Grantee may no longer serve as an officer of SunTrust or a Subsidiary.
Notwithstanding anything herein to the contrary, if the Grantee is subject to the terms of a Change in Control Agreement at the time of his termination of employment with SunTrust or a Subsidiary, solely for purposes this Unit Agreement, “Cause” shall have the meaning provided in the Change in Control Agreement.
(n) Termination for Good Reason - means a termination of employment made primarily because of (i) a failure to elect or reelect or to appoint or to reappoint Grantee to, or the removal of Grantee from, the position which he or she held with SunTrust prior to the Change in Control, (ii) a substantial change by the Board or supervising management in Grantee's functions, duties or responsibilities, which change would cause Grantee's position with SunTrust to become of less dignity, responsibility, importance or scope than the position held by Grantee prior to the Change in Control or (iii) a substantial reduction of Grantee's annual compensation from the lesser of: (A) the level in effect prior to the Change in Control or (B) any level established thereafter with the consent of the Grantee.
Notwithstanding anything herein to the contrary, if the Grantee is subject to the terms of a Change in Control Agreement at the time of his termination of employment with SunTrust or a Subsidiary, solely for purposes of this Unit Agreement, “Good Reason” shall have the meaning provided in the Change in Control Agreement.
§3. [Intentionally Omitted]
§4. VESTING. The Grantee shall vest in the Restricted Stock Units as follows:

(a) Subject to §14 of this Unit Agreement and §4(e), a number of Restricted Stock Units equal to [insert # - 1/3rd of Total Number of Shares] multiplied by the percentage in the table below shall vest on February 26, 2016 (the “Vesting Date”) if Return on Risk Weighted Assets for the Performance Period January 1, 2013 to December 31, 2013 (2013) equals or exceeds there threshold amount in the table below:

	
			
	Performance Level
	STI Return on
Risk-Weighted Assets
(RORWA)
	Percentage of Restricted Stock Units that Vest

	At or Above Target
	≥ *%
	100%

	Threshold
	*%
	50%

	 Below Threshold
	< *%
	—%

The percentage of Restricted Stock Units that vest if SunTrust's RORWA is between the “Threshold” and “Target” shall be determined by linear interpolation. The Committee shall determine the number of Restricted Stock Units (and related Dividend Equivalent Rights) that shall vest by multiplying the “Percentage of Restricted Stock Units That Vest,” set forth above, by one-third of the number of Restricted Stock Units granted under this Unit Agreement. 

(b) Subject to §14 of this Unit Agreement and §4(e), a number of Restricted Stock Units equal to [insert # - 1/3rd of Total Number of Shares] multiplied by the percentage in the table below shall vest on the Vesting Date if Return on Risk Weighted Assets for the Performance Period January 1, 2014 to December 31, 2014 (2014) equals or exceeds there threshold amount in the table below:

	
			
	Performance Level
	STI Return on
Risk-Weighted Assets
(RORWA)
	Percentage of Restricted Stock Units that Vest

	At or Above Target
	≥ *%
	100%

	Threshold
	*%
	50%

	 Below Threshold
	<*%
	—%

The percentage of Restricted Stock Units that vest if SunTrust's RORWA is between the “Threshold” and “Target” shall be determined by linear interpolation. The Committee shall determine the number of Restricted Stock Units (and related Dividend Equivalent Rights) that shall vest by multiplying the “Percentage of Restricted Stock Units That Vest,” set forth above, by one-third of the number of Restricted Stock Units granted under this Unit Agreement. 

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(c) Subject to §14 of this Unit Agreement and §4(e), a number of Restricted Stock Units equal to [insert # - 1/3rd of Total Number of Shares] multiplied by the percentage in the table below shall vest on the Vesting Date if Return on Risk Weighted Assets for the Performance Period January 1, 2015 to December 31, 2015 (2015) equals or exceeds there threshold amount in the table below:

	
			
	Performance Level
	STI Return on
Risk-Weighted Assets
(RORWA)
	Percentage of Restricted Stock Units that Vest

	At or Above Target
	≥ *%
	100%

	Threshold
	*%
	50%

	 Below Threshold
	< *%
	—%

The percentage of Restricted Stock Units that vest if SunTrust's RORWA is between the “Threshold” and “Target” shall be determined by linear interpolation. The Committee shall determine the number of Restricted Stock Units (and related Dividend Equivalent Rights) that shall vest by multiplying the “Percentage of Restricted Stock Units That Vest,” set forth above, by one-third of the number of Restricted Stock Units granted under this Unit Agreement. 
(d) Performance Periods are Independent. The performance periods in §4(a), §4(b), or §4(c) are independent of each other. For example, if the performance condition is met for 2013 and 2015, but not for 2014, then Restricted Stock Units shall vest on the Vesting Date pursuant to §4(a) and §4(c).
(e) No Restricted Stock Units shall vest pursuant to §4(a), §4(b), or §4(c), hereof unless the Grantee has remained in continuous employment with SunTrust or a Subsidiary from the Grant Date through the Vesting Date, except as provided in §6(b), §6(c), and §6(d) hereof (pertaining to termination of employment as a result of death, Disability, a reduction in force, and after Retirement).
§5. SUNTRUST CHANGE IN CONTROL. 
In the event that a Change in Control (as defined in the SunTrust Banks, Inc. 2009 Stock Plan) occurs prior to the Vesting Date and on or prior to any vesting date set forth in §6, then any unvested Restricted Stock Units (and related Dividend Equivalent Rights) shall be fully vested upon the earlier of: (a) the Vesting Date, provided that the Grantee has remained in continuous employment with SunTrust or a Subsidiary from the Grant Date through the Vesting Date; or (b) the date of the Grantee's termination of employment with SunTrust and its Subsidiaries as a result of: (i) an involuntary termination by SunTrust that does not result from the Grantee's death or Disability and does not constitute a Termination for Cause; (ii) the Grantee's death or Disability; or (iii) a voluntary termination by the Grantee as a result of Retirement or a Termination for Good Reason, then a number of Restricted Stock Units (and related Dividend Equivalent Rights) shall vest equal to the sum of (A) the number of Restricted Stock Units that would have vested (if any) if the Performance Period ended on the last day of the fiscal quarter immediately preceding the date of the Change in Control (based on the actual Performance Level achieved through such date) multiplied by a fraction, the numerator of which shall be the number of days from the first day of the Performance Period through the date of the last day of the fiscal quarter immediately preceding the date of such Change in Control, and the denominator of which shall be the total number of days in the original Performance Period; plus (B) the number of Restricted Stock Units that would have vested assuming SunTrust's achievement of the Target Performance Level multiplied by a fraction, the numerator of which shall be the number of days from the last day of the quarter immediately preceding the date of such Change in Control through the last day of the original Performance Period, and the denominator of which shall be the total number of days in the original Performance Period. In the event of such Change in Control, any Restricted Stock Units (and related Dividend Equivalent Rights) subject to this Unit Agreement that do not vest pursuant to this §5 shall terminate and be completely forfeited on the date of such termination of the Grantee's employment or, if earlier, the Vesting Date. Notwithstanding anything herein to the contrary, if the Grantee is subject to the terms of a Change in Control Agreement on the date of a Change in Control that provides for more generous vesting of the Restricted Stock Units, such vesting provisions of the Change in Control Agreement shall govern.
§6. TERMINATION OF EMPLOYMENT.
(a) If prior to the Vesting Date and the date of a Change in Control, the Grantee's employment with SunTrust and its Subsidiaries terminates for any reason other than those described in §6(b), §6(c) or §6(d), then the Restricted Stock Units (and related Dividend Equivalent Rights) subject to this Unit Agreement shall terminate and be completely forfeited on the date of such termination of the Grantee's employment. Notwithstanding anything in this §6 to the contrary, if the Grantee is Terminated for Cause from SunTrust and its Subsidiaries prior to payment pursuant to §7, all of the Restricted Stock Units (and related Dividend Equivalent Rights) will immediately and automatically without any action on the part of the Grantee or SunTrust, be forfeited by the Grantee.
(b) Death or Disability. If the Grantee's employment with SunTrust and its Subsidiaries terminates as a result of the Grantee's (i) death, or (ii) Disability prior to the Vesting Date and prior to the date of a Change in Control, then the service requirement of 

4

§4(e) shall be waived and the Restricted Stock Units (and related Dividend Equivalent Rights) that would have vested based on the actual Performance Level(s) achieved during the Performance Period(s) (in accordance with §4(a) §4(b) and/or §4(c)) from the date of Grant through the end of the Performance Period during which death or Disability occurred shall vest as of the last day of the Performance Period in which such termination occurred. For example, if the Performance Level achieved in 2013 is Target (100%), the Grantee becomes Disabled in 2014 and the Performance Level in 2014 is also Target (100%), then the Grantee would vest in two-thirds of the Restricted Stock Units subject to this Unit Agreement as of December 31, 2014. In the event of such termination, any Restricted Stock Units (and related Dividend Equivalent Rights) subject to this Unit Agreement that do not vest pursuant to this §5(b) shall terminate and be completely forfeited on such date.
(c) Reduction in Force. If the Grantee's employment with SunTrust and its Subsidiaries is involuntarily terminated by reason of a reduction in force which results in the Grantee's eligibility for payment of a severance benefit pursuant to the terms of the SunTrust Banks, Inc. Severance Pay Plan or any successor to such plan (“RIF”) prior to the Vesting Date and the date of a Change in Control, then the service requirement of §4(e) shall be waived and the Committee shall determine the number of Restricted Stock Units (and related Dividend Equivalent Rights) that vest by computing the sum of (x) the number of Restricted Stock Units (and related Dividend Equivalent Rights) that would have vested based on the actual Performance Levels achieved during the completed Performance Period(s)(in accordance with §4(a) §4(b) and/or §4(c)) preceding such termination, plus (y) a pro-rata number of Restricted Stock Units (and related Dividend Equivalent Rights) that would have vested based on the actual Performance Level achieved during the Performance Period in which such termination occurred shall vest as of the last day of the Performance Period in which such termination occurred. The pro-rata number of Restricted Stock Units (and related Dividend Equivalent Rights) vesting in the year of termination shall equal the product of: (i) the number of Restricted Stock Units that would have vested based on the actual Performance Level achieved as of the last day of the Performance Period; multiplied by (ii) a fraction, the numerator of which is equal to the number of days employed during the Performance Period and the denominator of which is 365. In the event of such termination, any Restricted Stock Units (and related Dividend Equivalent Rights) subject to this Unit Agreement that do not vest pursuant to this §5(c) shall terminate and be completely forfeited on such date.
(d) Retirement. If the Grantee's employment with SunTrust and its Subsidiaries terminates prior to the Vesting Date and the date of a Change in Control as a result of the Grantee's Retirement, then the number of Restricted Stock Units (and related Dividend Equivalent Rights) that would have vested based on actual Performance Levels achieved in accordance §4(a), §4(b) and §4(c) shall, subject to §8(d) and §8(e) below, be fully vested on the Vesting Date. 
§7. PAYMENT OF AWARD. 
(a) Subject to §14, the number of vested Restricted Stock Units (and related Dividend Equivalent Rights) payable pursuant to this §7 (the “Vested Units”) shall be determined in accordance with §4, §5 and §6 above and shall be paid in a lump sum upon the earliest to occur of the following: (i) the last day of the Performance Period during which the Grantee's death occurred, (ii) the last day of the Performance Period during which the Grantee's Disability occurred, (iii) the date of the Grantee's Separation from Service within two (2) years following a 409A Change in Control, or (iv) February 26, 2016. In the event payment is made pursuant to sub-paragraph (i), (ii) or (iii) above, such payment shall be made on the last day of the sixty (60) day period which commences immediately following the dates described in sub-paragraph (i), (ii) or (iii). In the event payment is made pursuant to sub-paragraph (iv) above, such payment shall be made within 30 days following February 26, 2016. Except as set forth below, the Vested Units shall be paid out in an equivalent number of shares of Stock; provided, however, the Grantee's right to any fractional share of Stock shall be paid in cash. In the event the Restricted Stock Units (and related Dividend Equivalent Rights) vest following a Change in Control pursuant to §4, the Vested Units shall be paid in cash, and the amount of the payment for each Vested Unit to be paid in cash will equal the Fair Market Value of a share of Stock on the date of the Change in Control. Notwithstanding anything herein to the contrary, distributions may not be made to a Key Employee upon a Separation from Service before the date which is six (6) months after the date of the Key Employee's Separation from Service (or, if earlier, the date of death of the Key Employee). Any payments that would otherwise be made during this period of delay shall be accumulated and paid.
(b) The Grantee shall be entitled to a Dividend Equivalent Right for each Vested Unit. At the same time that the Vested Units are paid, SunTrust shall pay each Dividend Equivalent Right in shares of Stock to the Grantee, or, in the event the Restricted Stock Units vest pursuant to §5, in cash; provided, however, the Grantee's right to any fractional share of Stock shall be paid in cash.
(c) The Grantee will not have any shareholder rights with respect to the Restricted Stock Units, including the right to vote or receive dividends, unless and until shares of Stock are issued to the Grantee as payment of the vested Restricted Stock Units.
(d) In the event that the date of the shareholder approval required by §14 of this Unit Agreement occurs after any payment date contemplated in this §7, then the Restricted Stock Units shall be paid within a reasonable time after the date such shareholder approval is obtained but in no event later than two and one-half months after the end of the calendar year in which the Restricted Stock Units vest.

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§8. COVENANTS, RESTRICTIONS AND LIMITATIONS.
(a) Compliance with Securities Laws. By accepting the Restricted Stock Units, the Grantee agrees not to sell Stock at a time when applicable laws or SunTrust's rules prohibit a sale. This restriction will apply as long as the Grantee is an employee, consultant or director of SunTrust or a Subsidiary of SunTrust. Upon receipt of nonforfeitable shares of Stock pursuant to this Unit Agreement, the Grantee agrees, if so requested by SunTrust, to hold such shares for investment and not with a view of resale or distribution to the public, and if requested by SunTrust, the Grantee must deliver to SunTrust a written statement satisfactory to SunTrust to that effect. The Committee may refuse to issue any shares of Stock to the Grantee for which the Grantee refuses to provide an appropriate statement.
(b) Forfeiture of Non-Vested Units. To the extent that the Grantee does not vest in any Restricted Stock Units, all interest in such units, the related shares of Stock, and any Dividend Equivalent Rights shall be forfeited. The Grantee shall have no right or interest in any Restricted Stock Unit or related share of Stock that is forfeited.
(c) Extinguishment Upon Settlement. Upon each issuance or transfer of shares of Stock in accordance with this Unit Agreement, a number of Restricted Stock Units equal to the number of shares of Stock issued or transferred to the Grantee shall be extinguished and such number of Restricted Stock Units will not be considered to be held by the Grantee for any purpose.
(d) Restrictive Covenants. Grantee must fully perform the following covenants from the Grant Date through the Vesting Date (the “Restricted Period”):
		
	(i)
	No Solicitation of Customers or Clients. Grantee shall not during the Restricted Period solicit any customer or client of SunTrust or any SunTrust Affiliate with whom Grantee had any material business contact during the two (2) year period which ends on the date Grantee's employment by SunTrust or a SunTrust Affiliate terminates for the purpose of competing with SunTrust or any SunTrust Affiliate for any reason, either individually, or as an owner, partner, employee, agent, consultant, advisor, contractor, salesman, stockholder, investor, officer or director of, or service provider to, any corporation, partnership, venture or other business entity.

		
	(ii)
	Anti-pirating of Employees. Absent the Compensation Committee's written consent, Grantee will not during the Restricted Period solicit to employ on Grantee's own behalf or on behalf of any other person, firm or corporation, any person who was employed by SunTrust or a SunTrust Affiliate during the term of Grantee's employment by SunTrust or a SunTrust Affiliate (whether or not such employee would commit a breach of contract), and who has not ceased to be employed by SunTrust or a SunTrust Affiliate for a period of at least one (1) year.

		
	(iii)
	Protection of Trade Secrets and Confidential Information. Grantee hereby agrees that Grantee will hold in a fiduciary capacity for the benefit of SunTrust and each SunTrust Affiliate, and will not directly or indirectly use or disclose, any Trade Secret that Grantee may have acquired during the term of Grantee's employment by SunTrust or a SunTrust Affiliate for so long as such information remains a Trade Secret. In addition Grantee agrees that during the Restricted Period Grantee will hold in a fiduciary capacity for the benefit of SunTrust and each SunTrust Affiliate, and will not directly or indirectly use or disclose, any Confidential or Proprietary Information that Grantee may have acquired (whether or not developed or compiled by Grantee and whether or not Grantee was authorized to have access to such information) during the term of, in the course of, or as a result of Grantee's employment by SunTrust or a SunTrust Affiliate.

		
	(iv)
	Reasonable and Necessary Restrictions. Grantee acknowledges that the restrictions, prohibitions and other provisions set forth in this Agreement, including without limitation the Territory and Restricted Period, are reasonable, fair and equitable in scope, terms and duration; are necessary to protect the legitimate business interests of SunTrust; and are a material inducement to SunTrust to enter into this Agreement. Grantee covenants that Grantee will not challenge the enforceability of this Agreement nor will Grantee raise any equitable defense to its enforcement.

Failure of Grantee subject to this §8(d) to fully perform the covenants set forth above will result in a forfeiture of all unpaid Restricted Stock Units (and related Dividend Equivalent Rights) under this Unit Agreement as of the date of such failure. Such forfeiture will be in compliance with Treas. Reg. §1.409A-3(f).
(e) Additional Post-Retirement Covenants. In the event of Grantee's Retirement, such Grantee must fully perform the following covenants from the date of such termination through the Vesting Date:
		
	(i)
	No Competitive Activity. Absent the Committee's written consent, Grantee shall not, during the Restricted Period and within the Territory, engage in any Managerial Responsibilities for or on behalf of any corporation, partnership, venture, or other business entity that engages directly or indirectly in the Financial Services Business whether as an owner, partner, employee, agent, consultant, advisor, contractor, salesman, stockholder, investor, officer or director; provided, however, that Grantee may own up to five percent (5%) of the stock of a publicly traded company that engages in the Financial Services Business so long as Grantee is only a passive investor and is not actively involved in such company in any way.

		
	(ii)
	Non-Disparagement. Grantee agrees not to knowingly make false or materially misleading statements or disparaging comments about SunTrust or any SunTrust Affiliate during the Restricted Period.

6

		
	(iii)
	Reasonable and Necessary Restrictions. Grantee acknowledges that the restrictions, prohibitions and other provisions set forth in this Agreement, including without limitation the Territory and Restricted Period, are reasonable, fair and equitable in scope, terms and duration; are necessary to protect the legitimate business interests of SunTrust; and are a material inducement to SunTrust to enter into this Agreement. Grantee covenants that Grantee will not challenge the enforceability of this Agreement nor will Grantee raise any equitable defense to its enforcement.

Failure of Grantee subject to this §8(e) to fully perform the covenants set forth above will result in a forfeiture of all unpaid Restricted Stock Units (and related Dividend Equivalent Rights) under this Unit Agreement as of the date of such failure. Such forfeiture will be in compliance with Treas. Reg. §1.409A-3(f).
(f) Additional Definitions. (A) The term "Confidential or Proprietary Information" for purposes of this Agreement shall mean any secret, confidential, or proprietary information of SunTrust or a SunTrust Affiliate (other than a Trade Secret) that has not become generally available to the public by the act of one who has the right to disclose such information without violating any right of SunTrust or a SunTrust Affiliate. (B) The term "Financial Services Business" for purposes of this Agreement shall mean the business of banking, including deposit, credit, trust and investment services, mortgage banking, asset management, and brokerage and investment banking services. (C) The term "Managerial Responsibilities" for purposes of this Agreement shall mean managerial and supervisory responsibilities and duties that are substantially the same as those Grantee is performing for SunTrust or a SunTrust Affiliate on the date of this Agreement. (D) For purposes of §8(e) only, the term "Restricted Period" shall mean the period which starts on the date Grantee's retirement from employment by SunTrust or a SunTrust Affiliate and which ends on the third anniversary of this Agreement. (E) The term "SunTrust Affiliate" for purposes of this Agreement shall mean any corporation which is a subsidiary corporation (within the meaning of §424(f) of the Code) of SunTrust except a corporation which has subsidiary corporation status under §424(f) of the Code exclusively as a result of SunTrust or a SunTrust Affiliate holding stock in such corporation as a fiduciary with respect to any trust, estate, conservatorship, guardianship or agency. (F) The term "Territory" for purposes of this Agreement shall mean the states of Alabama, Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia, and the District of Columbia, which are the states and Territories in which SunTrust has significant operations on the date of this Agreement. (G) "Trade Secret" for purposes of Agreement shall mean information, including, but not limited to, technical or nontechnical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, or a list of actual or potential customers or suppliers that: (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from it is disclosure or use, and (ii) is the subject of reasonable efforts by SunTrust or a SunTrust Affiliate to maintain its secrecy.
§9. WITHHOLDING.
(a) Upon the payment of any Restricted Stock Units, SunTrust's obligation to deliver shares of Stock or cash to settle the Vested Units and Dividend Equivalent Rights shall be subject to the satisfaction of applicable tax withholding requirements, including federal, state, and local requirements. The Grantee must pay to SunTrust any applicable federal, state or local withholding tax due as a result of such payment and authorizes SunTrust to withhold such amounts.
(b) The Committee shall have the right to reduce the number of shares of Stock issued to the Grantee to satisfy the minimum applicable tax withholding requirements.
§10. RECOVERY OF AWARDS. At the end of the performance period, the Committee will evaluate overall Company and business unit performance in making its award decisions. By accepting this Grant, Grantee agrees to return to SunTrust (or to the cancellation of) all or a portion of any grant, paid and unpaid, vested or unvested, previously granted to such Grantee based upon a determination made by the Committee pursuant to §10(a), §10(b), or §10(c) below. The Committee shall impose a clawback authorized below only to the extent determined appropriate by the Committee. All determinations by the Committee shall be final and binding. All references to the “Committee” in this §10 shall include the Committee and the Committee's designee.
(a) Miscalculation of Performance Metric. If the Committee determines that a financial metric used to determine vesting of a Grant was calculated incorrectly, whether or not SunTrust is required to restate its financial statements and without regard to whether such miscalculation was due to fraud or intentional misconduct, then the Committee may require reimbursement of all or part of a Grant previously paid to Grantee and/or authorize the cancellation of unpaid or unvested Grants in the amount by which any such Grant exceeded a lower payment that would have been made based on the correctly calculated financial metric. In addition, the Grant shall be subject to the clawback requirements of (i) §954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and implementing rules and regulations thereunder, (ii) similar rules under the laws of other jurisdictions and (iii) policies adopted by SunTrust to implement such requirements, all to the extent determined by the Committee to be applicable to Grantee. 

7

(b) Detrimental Conduct. If the Committee determines that Grantee has engaged in Detrimental Conduct, then Grantee shall be required to reimburse SunTrust all or a portion of the Grant previously vested or paid and/or will be subject to cancellation of unvested or unpaid Grant. “Detrimental Conduct” means any one of the following: (1) the commission of an act of fraud or dishonesty in the course of the Grantee's employment; (2) improper conduct by the Grantee including, but not limited to, fraud, unethical conduct, falsification of SunTrust's records, unauthorized removal of SunTrust property or information, theft, violent acts or threats of violence, unauthorized possession of controlled substances on the property of SunTrust, conduct causing reputational harm to SunTrust or its clients, or the use of SunTrust property, facilities or services for unauthorized or illegal purposes; (3) the improper disclosure by the Grantee of proprietary, privileged or confidential information of SunTrust or a SunTrust client or former client or breach of a fiduciary duty owed to SunTrust or a SunTrust client or former client; (4) the commission of a criminal act by the Grantee, whether or not performed in the workplace, that constitutes a felony or a crime of comparable magnitude under applicable law as determined by SunTrust in its sole discretion, or that subjects, or if generally known, would subject SunTrust to public ridicule or embarrassment; (5) the commission of an act or omission which causes the Grantee or SunTrust to be in violation of federal or state securities laws, rules or regulations, and/or the rules of any exchange or association of which SunTrust is a member, including statutory disqualification; (6) the Grantee's failure to perform the duties of Grantee's job which are set forth in Grantee's written job description, written operating policies, inBalance goals or other written document available to Grantee and which in each case SunTrust views as being material to Grantee's position and the overall business of SunTrust under circumstances where such failure is detrimental to SunTrust; (7) the material breach of a written policy applicable to teammates of SunTrust including, but not limited to, the SunTrust Code of Business Conduct and Ethics; (8) an act or omission by the Grantee which results or is intended to result in personal gain at the expense of SunTrust; or (9) an other act or omission which constitutes “cause” for termination.

(c) Loss. In order to encourage sustainable, long-term performance, settlement of the Restricted Stock Units (and related Dividend Equivalent Rights) shall be specifically conditioned on the Company and its lines of business remaining profitable during the period from the Grant Date until the applicable Settlement Date. If a loss is determined to have occurred, then the Committee, together with key control functions, shall review such losses and Grantee's accountability for such losses, and may require reimbursement of all or part of a Grant previously paid to Grantee and/or authorize the cancellation of unpaid or unvested Grants. In making such determination, the Committee shall consider all relevant facts and circumstances, including (i) the magnitude of the loss (including positive or negative variance from plan); (ii) Grantee's degree of involvement (including such factors as Grantee's current or former leadership role with respect to SunTrust or the relevant line of business, and the degree to which Grantee was involved in decisions that are determined to have contributed to the loss); and (iii) Grantee's performance.
§11. NO EMPLOYMENT RIGHTS. Nothing in the Plan or this Unit Agreement or any related material shall give the Grantee the right to continue in the employment of SunTrust or any Subsidiary or adversely affect the right of SunTrust or any Subsidiary to terminate the Grantee's employment with or without cause at any time.
§12. OTHER LAWS. Notwithstanding anything herein to the contrary, SunTrust shall have the right to refuse to pay any cash award or to issue or transfer any shares under this Unit Agreement if SunTrust acting in its absolute discretion determines that such payment or issuance or transfer of such Stock might violate any applicable law or regulation.
§13. MISCELLANEOUS.
(a) This Unit Agreement shall be subject to all of the provisions, definitions, terms and conditions set forth in the Plan and any interpretations, rules and regulations promulgated by the Committee from time to time, all of which are incorporated by reference in this Unit Agreement.
(b) The Plan and this Unit Agreement shall be governed by the laws of the State of Georgia (without regard to its choice-of-law provisions).
(c) No rights granted under the Plan or this Unit Agreement and no Restricted Stock Units shall be deemed transferable by the Grantee other than by will or by the laws of descent and distribution prior to the time the Grantee's interest in such units has become fully vested.
(d) Any written notices provided for in this Unit Agreement that are sent by mail shall be deemed received three (3) business days after mailing, but not later than the date of actual receipt. Notices shall be directed, if to the Grantee, at the Grantee's address indicated by SunTrust's records and, if to SunTrust, at SunTrust's principal executive office, to the attention of the General Counsel.
(e) If one or more of the provisions of this Unit Agreement shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and the invalid, illegal or unenforceable provisions shall be deemed null and void; however, to the extent permissible by law, any provisions which could 

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be deemed null and void shall first be construed, interpreted or revised retroactively to permit this Unit Agreement to be construed so as to foster the intent of this Unit Agreement and the Plan.
(f) This Unit Agreement (which incorporates the terms and conditions of the Plan) constitutes the entire agreement of the parties with respect to the subject matter hereof. This Unit Agreement supersedes all prior discussions, negotiations, understandings, commitments and agreements with respect to such matters.
(g) The Restricted Stock Units are intended to comply with Code §409A and official guidance issued thereunder. Notwithstanding anything herein to the contrary, this Unit Agreement shall be interpreted, operated and administered in a manner consistent with this intention.
§14. SHAREHOLDER APPROVAL OF MATERIAL TERMS AND PERFORMANCE METRIC. Notwithstanding anything to the contrary in this Unit Agreement, no Restricted Stock Units shall be paid unless and until the shareholders of SunTrust Banks, Inc. have approved the material terms of this award if and as required by Section 162(m) of the Internal Revenue Code.

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