Cullen/Frost Bankers, Inc. Restoration Plan

“Account” means the recordkeeping account which is maintained in the name of the Participant to account for any Employer Contributions and Credited Earnings which may be credited to his Account from time to time.

“Accrued Benefit” means the benefit payable to a vested Participant pursuant to the terms of Plan section 4.1(a)(1).

“Actuarial Equivalent” means a benefit of equivalent value, computed on the basis of the “1984 Unisex Pension Mortality Table” (“UP-1984 Mortality Table”) and an 8 percent annual interest rate assumption, except as otherwise specified in the Plan.

“Affiliate” means

Any entity or organization that, together with the Company, is part of a controlled group of corporations, within the meaning of Code section 414(b);

Any trade or business that, together with the Company, is under common control, within the meaning of Code section 414(c); and

Any entity or organization that is required to be aggregated with the Company, pursuant to Code sections 414(m) or 414(o).

“Applicable Code Restrictions” means the compensation or contribution limitations and restrictions that are applicable under Code sections 401(a)(17) and 415.

“Beneficiary” means the person, persons or trust designated by a Participant, as provided in Plan section 10.1.

“Board of Directors” means the Board of Directors of the Company.

“Change of Control” means the occurrence of any of the following:

The acquisition by any person, entity or “group” (as defined in section 13(d)(3) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)) as beneficial owner, directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of the then outstanding securities of the Company.

A change in the composition of the Board of Directors occurring within a 12-month period, as a result of which fewer than a majority of the directors are Incumbent Directors; or

The acquisition by any person, entity or “group” (as defined in section 13(d)(3) of the Exchange Act) during a 12-month period of at least 40% of the gross fair market value of the Company’s assets.

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means the administrative committee appointed by the Board of Directors, the Compensation and Benefits Committee, or the designee of either to administer this Plan in accordance with Article 6 of the Plan.

“Company” means Cullen/Frost Bankers, Inc., or any successor organization to the Company.

“Compensation Committee” means the Compensation Committee of the Board of Directors.

“Credited Earnings” means the earnings or losses credited to a Participant’s ESOP Contributions Account.

“Disability” means a total and permanent disability within the meaning of the Social Security Act.

“Early Retirement Age” means the attainment of age 55 while in active service with the Company.

“Eligible Employee” means an Employee of an Employer who

Is a Participant under the Retirement Plan, and, if applicable, The 401(k) Stock Purchase Plan; and

Who is designated as an “Eligible Employee” as provided in Plan section 3.1.

“Employee” means any person who is employed by the Company or an Affiliate and who is classified as a common-law Employee in the employment records of the Company or an Affiliate (other than a leased employee within the meaning of Code section 414(n)(2)).

“Employer” means the Company and each other employer who is a participating employer under The 401(k) Stock Purchase Plan or the Retirement Plan and who has elected to become a participating employer under this Plan as provided in Article 9.

“Employer Contributions” means the potential contributions made to the Plan by an Employer.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“ESOP” means the former stand-alone employee stock ownership plan sponsored by the Company that was merged into The 401(k) Stock Purchase Plan.

“ESOP Contributions” means the contributions described in Plan section 4.1.

“ESOP Contributions Account” means the recordkeeping subaccount which is maintained to reflect ESOP Contributions previously allocated to the Account by virtue of the Applicable Code Restrictions prior to January 1, 1991 and to reflect Credited Earnings as may be credited to that subaccount from time to time. No amount credited to the ESOP Contributions Account, whether on behalf of a Grandfathered Participant or a Nongrandfathered Participant, is subject to Code section 409A.

“Fund Account” means the “unfunded” trust arrangement as described in Plan section 7.2.

“Grandfathered Participant” means a Participant who attained his Early Retirement Age prior to January 1, 2005. The pre-2005 Accrued Benefit and the pre-2005 Account, if any, of a Grandfathered Participant will not be subject to Code section 409A.

“Incumbent Director” means a director on the Board of Directors who either is:

A Director of the Company as of January 1, 2009; or

Elected, or nominated for election, to the Board of Directors with the affirmative votes of at least two-thirds of the Incumbent Directors at the time of such election or nomination (but shall not include an individual not otherwise an Incumbent Director whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors to the Company).

“Nongrandfathered Participant” means a Participant who attained his Early Retirement Age after December 31, 2004. The Accrued Benefit of a Nongrandfathered Participant will be subject to Code section 409A because the Plan permits Nongrandfathered Participants to become eligible for enhanced early retirement benefits based on service provided to his Employer after December 31, 2004. A Nongrandfathered Participant may also have an Account composed of ESOP Contributions made prior to 2005. The ESOP Contributions for a Nongrandfathered Participant, if applicable, are not subject to Code section 409A.

“Plan” means the Cullen/Frost Restoration Benefit Plan as set forth in this document and as the same may be amended from time to time.

“Restoration Contribution” means the hypothetical contribution made to this Plan on account of the Applicable Code Restrictions that apply to The 401(k) Stock Purchase Plan and the Retirement Plan.

“Retirement Plan” means the Retirement Plan for Employees of Cullen/Frost Bankers, Inc. and its Affiliates, and as the same may be amended from time to time.

“Retirement Plan Account” means the recordkeeping subaccount which is maintained to reflect accruals allocated to the Account by virtue of the Applicable Code Restrictions.

“Separation from Service” means a Participant who ceases to be an Employee or otherwise separates from the service of the Company or an Affiliate on account of the Participant’s retirement, death or other termination of employment. Whether or not a Participant has incurred a Separation from Service will be based on all surrounding relevant circumstances, including, but not limited to, the reasonable belief of both the Participant and the Company (or Affiliate) that the Participant will perform no future services as an Employee for the Company or an Affiliate, as applicable. For purposes of this defined term, no Separation from Service will be deemed to have occurred if the Participant transfers employment from the Company or an Affiliate to another member of the Company’s Code section 414 controlled group. For this purpose, controlled group membership will include the Company and all Affiliates. A payment under this Plan shall be deemed to be on account of a Separation from Service if payment of the benefit is made by the end of the calendar year in which the Separation from Service occurs or, if later, within 2 ½ months following such Separation from Service. Additional delays in payment may be required for Participants who are Specified Employees so as to comply with the required six-month payment delay unless such six-month payment delay is not required by virtue of a permitted exception under Code section 409A and related Treasury Regulations.

“Service” means a period or periods of employment of an Employee with an Employer or a nonparticipating Affiliate as more fully set forth in the Retirement Plan.

“Specified Employee” means a Participant qualifying as a “key employee” for purposes of Code section 416 (determined without regard to Code section 416(i)(5)) by satisfying any one of the following conditions at any time during the 12-month period ending on each December 31 (“Identification Date”):

The Participant is among the top-paid 50 officers of the Company with annual compensation (within the meaning of Code section 415(c)(3)) in excess of $145,000 (subject to cost-of-living adjustments);

The Participant is a five-percent owner; or

The Participant is a one-percent owner and has annual compensation in excess of $150,000.

“Spouse” means with respect to a Participant, a person of the opposite sex from the Participant, who is the Participant’s husband or wife (as applicable) under applicable state law to whom the Participant has been legally married during the 12-month period immediately preceding the Participant’s date of death, if such death is earlier than the date the Participant has a Separation from Service. No individual, including an individual of the opposite sex, shall be the Spouse of a Participant on account of the fact that the individual is registered as the domestic partner of the Participant under state law, even if state law provides that the domestic partners shall have the same rights, protections, and benefits, under state law, as married persons. No individual shall be the Spouse of a Participant unless the person would be treated as the “Spouse” of the Participant under 1 USC section 7 (relating to the definition of a “spouse” for purposes of federal law, as added by the Defense of Marriage Act).

“The 401(k) Stock Purchase Plan” means The 401(k) Stock Purchase Plan for Employees of Cullen/Frost Bankers, Inc. and its Affiliates.

“Trust Fund” means the trust fund established for The 401(k) Stock Purchase Plan.

Pre-2005 Benefit. The benefit payable to a Participant (or, if applicable, his Beneficiary) who has a vested benefit upon his Separation from Service composed of the Participant’s pre-2005 benefit, if applicable, shall be:

An amount equal to the excess, if any, of

The value of a single life annuity which would have been payable to the Participant under the Retirement Plan, if the provisions of the Retirement Plan were administered without regard to the limitations of Code sections 415 and 401(a)(17),

The value of a single life annuity which is in fact payable to the Participant under the Retirement Plan; and

An amount equal to the balance, if any, credited to his Account, determined as follows:

For plan years beginning prior to January 1, 1991, there shall be credited to the recordkeeping account annually an amount equal to the excess, if any, of:

The total value of the annual addition which would have been allocated to the Participant under the ESOP during the relevant plan year, if the provisions of the ESOP were administered without regard to the maximum annual addition limitations of Code sections 415 and 401(a)(17),

The value of the annual addition which is in fact allocated to the Participant under the ESOP during said plan year;

For plan years beginning after December 31, 1990, there shall be credited to the recordkeeping account annually an amount equal to the excess, if any, of:

The total value of the “ESOP Contributions” (as defined in The 401(k) Stock Purchase Plan) which would have been allocated to the Participant under The 401(k) Stock Purchase Plan during the relevant plan year, if the provisions of The 401(k) Stock Purchase Plan were administered without regard to the maximum annual addition limitations of Code sections 415 and 401(a)(17),

The value of the annual ESOP Contributions which are in fact allocated to the Participant under The 401(k) Stock Purchase Plan during said plan year; and

The Account shall be adjusted to reflect all payments, distributions, and any expenses charged to the Participant’s Account and all hypothetical earnings, dividends, stock splits, gains, or losses on the amounts credited to his Account, with each such adjustment being made as soon as administratively feasible following the event giving rise to the adjustment. In making such adjustments, the hypothetical earnings, dividends, stock splits, gains, or losses shall be determined based upon the experience of the Trust Fund during the same period.

Post-2004 Benefit. The benefit payable to a Participant (or, if applicable, his Beneficiary) who has a vested benefit upon his Separation from Service composed of the Participant’s post-2004 benefit, if applicable, shall be:

An amount equal to the excess, if any, of

The value of a single life annuity which would have been payable to the Participant under the Retirement Plan, if the provisions of the Retirement Plan were administered without regard to the limitations of Code sections 415 and 401(a)(17),

The value of a single life annuity which is in fact payable to the Participant under the Retirement Plan; and

The Participant’s breach of any fiduciary duty to an Employer;

The Participant’s knowing failure or refusal to comply with laws or regulations applicable to an Employer and its business;

The Participant’s commission of any criminal or fraudulent acts against an Employer as an Employee; or

The Participant’s gross or willful misconduct as an Employee resulting in loss to an Employer or any other Affiliate of the Company, or damage to the reputation of an Employer or any other Affiliate of the Company.

To establish rules, policies, and procedures for administration of the Plan;

To construe and interpret the Plan, to decide all questions of eligibility, and to determine the amount, manner, and time of payment of any benefits hereunder;

To make a determination as to the right of any person to a benefit and the amount thereof;

To obtain from the Company such information as shall be necessary for the proper administration of the Plan;

To prepare and distribute information explaining the Plan;

To keep all records necessary for the operation and administration of the Plan;

To prepare and file any reports, descriptions, or forms required by the Code or ERISA; and

To designate or employ agents and counsel (who may also be persons employed by the Company) and direct them to exercise the powers of the Committee.

The Company (including any successor employer, as applicable) shall indemnify and hold harmless each of the following persons (“Indemnified Persons”) under the terms and conditions of subsection (b).

The Committee; and

Each Employee, former Employee, current and former members of the Committee, or current or former members of the Board of Directors who have, or had, responsibility (whether by delegation from another person, an allocation of responsibilities under the terms of this Plan document, or otherwise) for a fiduciary duty, a non-fiduciary settlor function (such as deciding whether to approve a plan amendment), or a non-fiduciary administrative task relating to the Plan.

The Company shall indemnify and hold harmless each Indemnified Person against any and all claims, losses, damages, and expenses, including reasonable attorneys’ fees and court costs, incurred by that person on account of his good-faith actions or failures to act with respect to his responsibilities relating to the Plan. The Company’s indemnification shall include payment of any amounts due under a settlement of any lawsuit or investigation, but only if the Company agrees to the settlement.

An Indemnified Person shall be indemnified under this Plan section 6.4 only if he notifies an Appropriate Person (defined below) at the Company of any claim asserted against or any investigation of the Indemnified Person that relates to the Indemnified Person’s responsibilities with respect to the Plan.

An “Appropriate Person” is one or more of the following individuals at the Company:

The Chief Executive Officer,

The Chief Financial Officer,

Its General Counsel,

Treasurer, or

Group Executive Vice President, HR.

The notice may be provided orally or in writing. The notice must be provided to the Appropriate Person promptly after the Indemnified Person becomes aware of the claim or investigation. No indemnification shall be provided under this Plan section 6.4 to the extent that the Company is materially prejudiced by the unreasonable delay of the Indemnified Person in notifying an Appropriate Person of the claim or investigation.

An Indemnified Person shall be indemnified under this Plan section 6.4 with respect to attorneys’ fees, court costs, or other litigation expenses or any settlement of such litigation only if the Indemnified Person agrees to permit the Company to select counsel and to conduct the defense of the lawsuit and agrees not to take any action in the lawsuit that the Company believes would be prejudicial to the Company’s interests.

No Indemnified Person, including an Indemnified Person who is a former Employee, shall be indemnified under this Plan section 6.4 unless he makes himself reasonably available to assist the Company with respect to the matters in issue and agrees to provide whatever documents, testimony, information, materials, or other forms of assistance that the Company shall reasonably request.

No Indemnified Person shall be indemnified under this Plan section 6.4 with respect to any action or failure to act that is judicially determined to constitute or be attributable to the gross negligence or willful misconduct of the Indemnified Person.

Payments of any indemnity under this Plan section 6.4 shall only be made from assets of the Company. The provisions of this Plan section 6.4 shall not preclude or limit such further indemnities or reimbursement under this Plan as allowable under applicable law, as may be available under insurance purchased by the Company, or as may be provided by the Company under any by-law, agreement or otherwise, provided that no expense shall be indemnified under this Plan section 6.4 that is otherwise indemnified by the Company, by an insurance contract purchased by the Company, or by this Plan.

The right of a Participant or any other person entitled to claim a benefit under the Plan (collectively “Claimants”) to a benefit shall be determined by the Committee, provided, however, that the Committee may delegate its responsibility to any person.

The Claimant (or an authorized representative of a Claimant) may file a claim for benefits by written notice to the Committee. The Committee shall establish procedures for determining whether a person is authorized to represent a Claimant.

Any claim for benefits under the Plan, pursuant to this Plan section 6.6, shall be filed with the Committee no later than three months after the date of the Participant’s termination of employment. The Committee in its sole discretion shall determine whether this limitation period has been exceeded.

Notwithstanding anything to the contrary in this Plan, the following shall not be a claim for purposes of this Plan section 6.6:

A request for determination of eligibility, participation, or benefit calculation under the Plan without an accompanying claim for benefits under the Plan. The determination of eligibility, participation, or benefit calculation under the Plan may be necessary to resolve a claim, in which case such determination shall be made in accordance with the claims procedures set forth in this Plan section 6.6.

Any casual inquiry relating to the Plan, including an inquiry about benefits or the circumstances under which benefits might be paid under the Plan.

A claim that is defective or otherwise fails to follow the procedures of the Plan (e.g., a claim that is addressed to a party other than the Committee or an oral claim).

An application or request for benefits under the Plan.

If a claim for benefits is wholly or partially denied, the Committee shall, within a reasonable period of time, but no later than 90 days after receipt of the claim, notify the Claimant of the denial of benefits. If special circumstances justify extending the period up to an additional 90 days, the Claimant shall be given written notice of this extension within the initial 90-day period, and such notice shall set forth the special circumstances and the date a decision is expected. A notice of denial:

Shall be written in a manner calculated to be understood by the Claimant; and

Shall contain:

The specific reasons for denial of the claim;

Specific reference to the Plan provisions on which the denial is based;

A description of any additional material or information necessary for the Claimant to perfect the claim, along with an explanation as to why such material or information is necessary; and

An explanation of the Plan’s claim review procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action under BRISA section 502(a) following an adverse determination on review.

Within 60 days of the receipt by the Claimant of the written denial of his or her claim or, if the claim has not been granted, within a reasonable period of time (which shall not be less than the 90 or 180 days described in subsection (b)), the Claimant (or an authorized representative of a Claimant) may file a written request with the Committee that it conduct a full review of the denial of the claim. In connection with the Claimant’s appeal, upon request, the Claimant may review and obtain copies of all documents, records and other information relevant to the Claimant’s claim for benefits (but not including any document, record or information that is subject to any attorney-client or work-product privilege) and may submit issues and comments in writing. The Claimant may submit written comments, documents, records, and other information relating to the claim for benefits. All comments, documents, records, and other information submitted by the Claimant shall be taken into account in the appeal without regard to whether such information was submitted or considered in the initial benefit determination.

The Committee shall deliver to the Claimant a written decision on the claim promptly, but no later than 60 days after the receipt of the Claimant’s request for such review, unless special circumstances exist that justify extending this period up to an additional 60 days. If the period is extended, the Claimant shall be given written notice of this extension during the initial 60-day period and such notice shall set forth the special circumstances and the date a decision is expected. The decision on review of the denial of the claim:

Shall be written in a manner calculated to be understood by the Claimant;

Shall include specific reasons for the decision;

Shall contain specific references to the Plan provisions on which the decision is based;

Shall contain a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and other information relevant to the Claimant’s claim for benefits. Whether a document, record, or other information is relevant to a claim for benefits shall be determined by reference to U.S. Department of Labor Regulations section 2560; and

Shall contain a statement of the Claimant’s right to bring a civil action under ERISA section 502(a) following an adverse determination on review.

The Plan provides that no lawsuit may be initiated by any person before fully pursuing the procedures set out in this Plan section 6.6, including the appeal permitted pursuant to subsection (c). In addition, no legal action may be commenced later than 365 days subsequent to the date of the written response of the Committee to a Claimant’s request for review pursuant to subsection (d).

The termination does not occur proximate to a downturn in the financial health of the Company;

All nonqualified nonelective account and nonaccount-based retirement plans maintained by the Company and all Affiliates that would be aggregated with the Plan under Code section 409A are terminated when the Plan is terminated;

No payments are made within 12 months after the date when the Company takes all steps necessary to terminate and liquidate the Plan, other than payments made pursuant to the Plan’s otherwise applicable distribution provisions;

All benefits are distributed within 24 months after the date when the Company takes all steps necessary to terminate and liquidate the Plan; and

Neither the Company nor any Affiliate establishes a new nonqualified, nonelective account or nonaccount-based plan that would be aggregated with the Plan under Code section 409A at any time within three years after the date when the Company takes all steps necessary to terminate and liquidate the Plan.

Executing an adoption instrument adopting the Plan, and agreeing to be bound as a participating Employer by all the terms, provisions, conditions, and limitations of the Plan; and

Compiling and submitting all information required by the Company with reference to persons in its employment eligible for membership in the Plan.

No benefit amount payable under the Plan shall be payable until and unless any and all amounts representing debts or other obligations owed to the Company or other Employer by the Participant with respect to whom such amount would otherwise be payable shall have been fully paid, and

The Committee shall also establish procedures to determine whether a Participant’s Plan benefit is subject to a legally enforceable domestic relations order, whether or not the domestic relations order is intended to be a qualified domestic relations order within the meaning of Code section 414(p).

/s/ Richard W. Evans, Jr.    

Chairman    

/s/ Emily Skillman    

Group Executive Vice President        (Corporate Seal)