{"id":40252,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/performance-based-stock-incentive-plan-schwab.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"performance-based-stock-incentive-plan-schwab","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/performance-based-stock-incentive-plan-schwab.html","title":{"rendered":"Performance-based Stock Incentive Plan &#8211; Schwab"},"content":{"rendered":"<p align=\"center\"><strong>2004 STOCK INCENTIVE PLAN <\/strong><\/p>\n<p align=\"center\"><strong>NOTICE OF RESTRICTED STOCK UNIT AWARD <\/strong><\/p>\n<p align=\"center\"><strong>(PERFORMANCE-BASED VESTING) <\/strong><\/p>\n<p align=\"justify\">You have been granted Restricted Stock Units. A Restricted<br \/>\nStock Unit represents the right to receive, subject to certain conditions, a<br \/>\nshare of Common Stock of The Charles Schwab Corporation (&#8220;<em>Schwab<\/em>&#8220;),<br \/>\nunder The Charles Schwab Corporation 2004 Stock Incentive Plan (the<br \/>\n&#8220;<em>Plan<\/em>&#8220;). Your Restricted Stock Units are granted subject to the<br \/>\nfollowing terms:<\/p>\n<\/p>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"bottom\"><strong>Name of Recipient:<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"bottom\">\n<p><strong>Total Number of<\/strong><\/p>\n<p><strong>Restricted  Stock  Units<\/strong><\/p>\n<p><strong>Granted:<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"bottom\">\n<p><strong>Fair  Market  Value  per<\/strong><\/p>\n<p><strong>Restricted  Stock  Unit:<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"bottom\"><strong>Grant Date:<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Vesting Schedule:<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">So long as you remain in service in good standing and subject<br \/>\nto the terms of the Restricted Stock Unit Agreement and certification of the<br \/>\nPerformance Goal by Schwab153s Compensation Committee, this award vests on the<br \/>\nfollowing Vesting Dates, subject to the restrictions below:<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\"><u>Number of Restricted Stock Units on Vesting Date:<\/u><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"justify\">The number of Restricted Stock Units indicated will vest only<br \/>\nif Schwab153s Compensation Committee certifies that as of the Vesting Date next to<br \/>\nthe number of Restricted Stock Units, Schwab has satisfied the Performance Goal<br \/>\nfor the applicable one-year period [insert performance period] ending prior to<br \/>\nsuch Vesting Date. The Performance Goal shall be: [insert the performance goal<br \/>\nfor each one-year period.]<\/p>\n<p align=\"justify\">If the Performance Goal is not met for any one-year period,<br \/>\nyou will have a second opportunity to vest in the unvested portion of the award<br \/>\nif [insert the performance goal for the four-year period.]<\/p>\n<p align=\"justify\">Except as otherwise provided in the Restricted Stock Unit<br \/>\nAgreement, if the Performance Goals noted above are not met, any unvested<br \/>\nportion of the award will be forfeited<\/p>\n<\/p>\n<hr>\n<p align=\"justify\">automatically and permanently on [insert date of second<br \/>\nchance for vesting] or the date established by the Compensation Committee.<\/p>\n<p align=\"justify\">Any vested Restricted Stock Units will be paid in shares of<br \/>\nCommon Stock of The Charles Schwab Corporation (&#8220;<em>Shares<\/em>&#8220;) as soon as<br \/>\nadministratively possible after vesting, but in no event beyond<br \/>\nMarch  15<sup>th<\/sup> of the year following the year of vesting.<\/p>\n<p align=\"justify\">You and Schwab agree that this award is granted under and<br \/>\ngoverned by the terms and conditions of the Plan and the Restricted Stock Unit<br \/>\nAgreement, both of which are made a part of this notice. Please review the<br \/>\nRestricted Stock Unit Agreement and the Plan carefully, as they explain the<br \/>\nterms and conditions of this award. You agree that Schwab may deliver<br \/>\nelectronically all documents relating to the Plan or this award (including,<br \/>\nwithout limitation, prospectuses required by the Securities and Exchange<br \/>\nCommission) and all other documents that Schwab is required to deliver to its<br \/>\nstockholders. By accepting this award, you agree to all of the terms and<br \/>\nconditions described above, in the Restricted Stock Unit Agreement and in the<br \/>\nPlan, and you have no right whatsoever to change or negotiate such terms and<br \/>\nconditions.<\/p>\n<\/p>\n<p align=\"center\">2<\/p>\n<\/p>\n<hr>\n<p align=\"center\"><strong>THE CHARLES SCHWAB CORPORATION <\/strong><\/p>\n<p align=\"center\"><strong>2004 STOCK INCENTIVE PLAN <\/strong><\/p>\n<p align=\"center\"><strong>RESTRICTED STOCK UNIT AGREEMENT <\/strong><\/p>\n<p align=\"center\"><strong>(PERFORMANCE-BASED VESTING) <\/strong><\/p>\n<\/p>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"1%\" valign=\"bottom\"><\/td>\n<td width=\"81%\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Payment for<\/strong><\/p>\n<p><strong>Units<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">No payment is required for the Restricted Stock Units that<br \/>\nyou are receiving. Restricted Stock Units are an unfunded and unsecured<br \/>\nobligation of Schwab.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Vesting<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">Subject to the provisions of this Agreement, this award<br \/>\nbecomes vested as described in the Notice of Restricted Stock Unit Award, of<br \/>\nwhich this Restricted Stock Unit Agreement is a part. Unvested units will be<br \/>\nconsidered &#8220;<u><em>Restricted Stock Units<\/em>.<\/u>&#8221; If your service terminates<br \/>\nfor any reason, then your Restricted Stock Units will automatically and<br \/>\npermanently be forfeited to the extent that they have not vested before the<br \/>\ntermination date and will not vest as a result of the termination, unless<br \/>\notherwise noted below. This means that the Restricted Stock Units will<br \/>\nimmediately revert to Schwab. You will receive no payment for Restricted Stock<br \/>\nUnits that are forfeited. Schwab determines when your service terminates for<br \/>\nthis purpose. For all purposes of this Agreement, &#8220;<u><em>service<\/em><\/u>&#8221;<br \/>\nmeans continuous employment as a common-law employee of Schwab or a parent<br \/>\ncompany or subsidiary of Schwab, and &#8220;<u><em>subsidiary<\/em><\/u>&#8221; means a<br \/>\nsubsidiary corporation as defined in section 424(f) of the Internal Revenue Code<br \/>\nof 1986, as amended (the &#8220;<u><em>Code<\/em><\/u>&#8220;).<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Accelerated<\/strong><\/p>\n<p><strong>Vesting<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">This award, to the extent not already forfeited, will become<br \/>\nfully vested if your service terminates on account of your death or disability.<br \/>\nIf, prior to the date your service terminates, Schwab is subject to a<br \/>\n&#8220;<u><em>change in control<\/em><\/u>&#8221; (as defined in the Plan document), this<br \/>\naward, to the extent not already forfeited, will become fully vested as of the<br \/>\ndate that the change in control occurs.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Continued<\/strong><\/p>\n<p><strong>Vesting<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">If your service terminates on account of your retirement and<br \/>\nyour retirement occurs at least two years after the Grant Date indicated in the<br \/>\nNotice of Restricted Stock Unit Award, you will be treated as in service in good<br \/>\nstanding for purposes of determining further vesting of the award.<\/p>\n<p align=\"justify\">If you are entitled to severance benefits under The Charles<br \/>\nSchwab Severance Pay Plan (or any successor plan), then you may be treated as in<br \/>\nservice in good standing during your Severance Period for purposes of<br \/>\ndetermining further vesting of the award under the terms of that plan.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">3<\/p>\n<\/p>\n<hr>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Definition of Fair Market Value<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">Fair market value means the average of the high and low price<br \/>\nof a Share (as defined below) as reported on the New York Stock Exchange on the<br \/>\napplicable determination date.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Definition of Disability<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">For all purposes of this Agreement,<br \/>\n&#8220;<u><em>disability<\/em><\/u>&#8221; means that you have a disability such that you have<br \/>\nbeen determined to be eligible for benefits under Schwab153s long-term disability<br \/>\nplan.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Definition of Retirement<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">If you are an employee of Schwab and its subsidiaries,<br \/>\n&#8220;<u><em>retirement<\/em><\/u>&#8221; means termination of service for any reason other<br \/>\nthan death at any time after you attain age 55, but only if, at the time of your<br \/>\ntermination, you have been credited with at least 10 years of service.<\/p>\n<p align=\"justify\">The phrase &#8220;<u><em>years of service<\/em><\/u>&#8221; above has the<br \/>\nsame meaning given to it under The SchwabPlan Retirement Savings and Investment<br \/>\nPlan (or any successor plan).<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Payment of<\/strong><\/p>\n<p><strong>Shares<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">Restricted Stock Units that vest will be paid in shares of<br \/>\nCommon Stock of The Charles Schwab Corporation (&#8220;<em>Shares<\/em>&#8220;) as soon as<br \/>\nadministratively possible following vesting, but in no event beyond March<br \/>\n15<sup>th<\/sup> of the year following the year of vesting.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Restrictions on Restricted Stock Units<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">You may not sell, transfer, pledge or otherwise dispose of<br \/>\nany Restricted Stock Units without Schwab153s written consent. Schwab will deliver<br \/>\nShares to you only after the Restricted Stock Units vest and after all other<br \/>\nterms and conditions in this Agreement have been satisfied.<\/p>\n<p align=\"justify\">You may make a gift of Restricted Stock Units to your spouse,<br \/>\nchildren or grandchildren or to a trust established by you for the benefit of<br \/>\nyourself or your spouse, children or grandchildren. However, a transferee of<br \/>\nRestricted Stock Units must agree in writing on a form prescribed by Schwab to<br \/>\nbe bound by all provisions of this Agreement as a condition for the transfer<br \/>\nprior to the Restricted Stock Units becoming vested.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Delivery of<\/strong><\/p>\n<p><strong>Shares After<\/strong><\/p>\n<p><strong>Death<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">In the event of your death prior to the date your service<br \/>\nterminates, your Shares will be delivered to your beneficiary or beneficiaries.<br \/>\nYou may designate one or more beneficiaries by filing a beneficiary designation<br \/>\nform. You may change your beneficiary designation by filing a new form with<br \/>\nSchwab at any time prior to your death. If you do not designate a beneficiary or<br \/>\nif your designated beneficiary predeceases you, then, your Shares will be<br \/>\ndelivered to your estate. The Compensation Committee, in its sole discretion,<br \/>\nwill determine the form and time of the distribution of Shares to your estate.<br \/>\nIn no<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">4<\/p>\n<\/p>\n<hr>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">event will the payment be made beyond March  15<sup>th<\/sup><br \/>\nof the year following the year of <br \/>\ndeath.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Restrictions on<\/strong><\/p>\n<p><strong>Resale<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">You agree not to sell any Shares at a time when applicable<br \/>\nlaws, Schwab153s policies or an agreement between Schwab and its underwriters<br \/>\nprohibit a sale. This restriction will apply as long as your service continues<br \/>\nand for such period of time after the termination of your service as Schwab may<br \/>\nspecify.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Withholding<\/strong><\/p>\n<p><strong>Taxes<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">The Restricted Stock Units will not be paid in Shares unless<br \/>\nyou have made acceptable arrangements to pay any applicable withholding of<br \/>\nincome and employment taxes that may be due as a result of this award. With<br \/>\nSchwab153s consent, these arrangements may include without limitation withholding<br \/>\nShares that otherwise would be issued to you when this award vests. In its sole<br \/>\ndiscretion, Schwab may withhold the minimum number of whole Shares, valued at<br \/>\nthe fair market value on the Vesting Date, required to satisfy such applicable<br \/>\nwithholding taxes. Any residual amount of applicable withholding taxes, i.e.,<br \/>\namounts of less than the fair market value of a Share, may be deducted from your<br \/>\npay. If withholding taxes are due and you have terminated employment, applicable<br \/>\nwithholding taxes will be deducted from your Schwab brokerage account. You are<br \/>\nresponsible for having sufficient funds in your Schwab brokerage account to<br \/>\ncover the withholding taxes at the time they are due.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>No<\/strong><\/p>\n<p><strong>Stockholder<\/strong><\/p>\n<p><strong>Rights<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">Your Restricted Stock Units carry no voting or other<br \/>\nstockholder rights. You have no rights as a Schwab stockholder until your units<br \/>\nare settled by issuing Shares.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Contribution of<\/strong><\/p>\n<p><strong>Par Value<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">On your behalf, Schwab will contribute to its capital an<br \/>\namount equal to the par value of the Shares issued to you.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Dividend<\/strong><\/p>\n<p><strong>Equivalent Rights<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">If Schwab pays cash dividends on Shares, each Restricted<br \/>\nStock Unit will accrue a dividend equivalent equal to the cash dividend paid per<br \/>\nShare, subject to the same vesting and forfeiture provisions as the associated<br \/>\nRestricted Stock Units, to be paid in cash without interest at the time the<br \/>\nassociated Restricted Stock Units vest and Shares are released. In no event will<br \/>\nthe accumulated dividend equivalent be paid beyond March 15<sup>th<\/sup> of the<br \/>\nyear following the year in which the associated Restricted Stock Units vest.\n<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>No Right to<\/strong><\/p>\n<p><strong>Remain<\/strong><\/p>\n<p><strong>Employee<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"top\">\n<p align=\"justify\">Nothing in this Agreement will be construed as giving you the<br \/>\nright to be retained as an employee, contingent worker or director of Schwab and<br \/>\nits subsidiaries for any specific duration or at all.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">5<\/p>\n<\/p>\n<hr>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Limitation on<\/strong><\/p>\n<p><strong>Payments<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">If a payment from the Plan would constitute an excess<br \/>\nparachute payment under section 280G of the Code or if there have been certain<br \/>\nsecurities law violations, then your award may be reduced or forfeited and you<br \/>\nmay be required to disgorge any profit that you have realized from your award.\n<\/p>\n<p align=\"justify\">If a disqualified individual receives a payment or transfer<br \/>\nunder the Plan that would constitute an excess parachute payment under 280G of<br \/>\nthe Code, such payment will be reduced, as described below. Generally, someone<br \/>\nis a &#8220;<u><em>disqualified individual<\/em><\/u>&#8221; if he or she is (a) an officer of<br \/>\nSchwab, (b) a member of the group consisting of the highest paid 1% of the<br \/>\nemployees of Schwab or, if less, the highest paid 250 employees of Schwab, or<br \/>\n(c) a 1% stockholder of Schwab. For purposes of the section on &#8220;Limitation on<br \/>\nPayments,&#8221; the term &#8220;<em><u>Schwab<\/u><\/em>&#8221; will include affiliated<br \/>\ncorporations to the extent determined by the independent auditors most recently<br \/>\nselected by the Schwab Board of Directors (the &#8220;<u><em>Auditors<\/em><\/u>&#8220;) in<br \/>\naccordance with section 280G(d)(5) of the Code.<\/p>\n<p align=\"justify\">In the event that the Auditors determine that any payment or<br \/>\ntransfer in the nature of compensation to or for your benefit, whether paid or<br \/>\npayable (or transferred or transferable) pursuant to the terms of the Plan or<br \/>\notherwise (a &#8220;Payment&#8221;), would be nondeductible for federal income tax purposes<br \/>\nbecause of the provisions concerning &#8220;excess parachute payments&#8221; in section 280G<br \/>\nof the Code, then the aggregate present value of all Payments will be reduced<br \/>\n(but not below zero) to the Reduced Amount; provided, however, that the<br \/>\nCompensation Committee may specify in writing that the award will not be so<br \/>\nreduced and will not be subject to reduction under this section.<\/p>\n<p align=\"justify\">For this purpose, the &#8220;<em><u>Reduced Amount<\/u><\/em>&#8221; will<br \/>\nbe the amount, expressed as a present value, which maximizes the aggregate<br \/>\npresent value of the Payments without causing any Payment to be nondeductible by<br \/>\nSchwab because of section 280G of the Code.<\/p>\n<p align=\"justify\">If the Auditors determine that any Payment would be<br \/>\nnondeductible because of section 280G of the Code, then Schwab will promptly<br \/>\ngive you notice to that effect and a copy of the detailed calculation of the<br \/>\nReduced Amount. You may then elect, in your discretion, which and how much of<br \/>\nthe Payments will be eliminated or reduced (as long as after such election, the<br \/>\naggregate present value of the Payments equals the Reduced Amount). You will<br \/>\nadvise Schwab in writing of your election within 10 days of receipt of the<br \/>\nnotice.<\/p>\n<p align=\"justify\">If you do not make such an election within the 10-day period,<br \/>\nthen Schwab may elect which and how much of the Payments will be eliminated or<br \/>\nreduced (as long as after such election the aggregate<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">6<\/p>\n<\/p>\n<hr>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">present value of the Payments equals the Reduced Amount).<br \/>\nSchwab will notify you promptly of its election. Present value will be<br \/>\ndetermined in accordance with section 280G(d)(4) of the Code. The Auditors153<br \/>\ndeterminations will be binding upon you and Schwab and will be made within 60<br \/>\ndays of the date when a Payment becomes payable or transferable.<\/p>\n<p align=\"justify\">As promptly as practicable following these determination and<br \/>\nelections, Schwab will pay or transfer to or for your benefit such amounts as<br \/>\nare then due to you under the Plan, and will promptly pay or transfer to or for<br \/>\nyour benefit in the future such amounts as become due to you under the Plan.\n<\/p>\n<p align=\"justify\">As a result of uncertainty in the application of section 280G<br \/>\nof the Code at the time of an initial determination by the Auditors, it is<br \/>\npossible that Payments will have been made by Schwab which should not have been<br \/>\nmade (an &#8220;<u><em>Overpayment<\/em><\/u>&#8220;) or that additional Payments which will<br \/>\nnot have been made by Schwab could have been made (an<br \/>\n&#8220;<em><u>Underpayment<\/u><\/em>&#8220;), consistent in each case with the calculation of<br \/>\nthe Reduced Amount. In the event that the Auditors, based upon the assertion of<br \/>\na deficiency by the Internal Revenue Service against you or Schwab which the<br \/>\nAuditors believe has a high probability of success, determine that an<br \/>\nOverpayment has been made, the amount of such Overpayment will be paid by you to<br \/>\nSchwab on demand, together with interest at the applicable federal rate provided<br \/>\nin section 7872(f)(2) of the Code. However, no amount will be payable by you to<br \/>\nSchwab if and to the extent that such payment would not reduce the amount which<br \/>\nis subject to taxation under section 4999 of the Code. In the event that the<br \/>\nAuditors determine that an Underpayment has occurred, such Underpayment will<br \/>\npromptly be paid or transferred by Schwab to or for your benefit, together with<br \/>\ninterest at the applicable federal rate provided in section 7872(f)(2) of the<br \/>\nCode.<\/p>\n<p align=\"justify\">Notwithstanding the foregoing, in no event will a payment be<br \/>\nmade under this Section beyond March  15<sup>th<\/sup> of the year following the<br \/>\nyear in which the amount ceases to be subject to a substantial risk of<br \/>\nforfeiture.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Claims Procedure<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">You may file a claim for benefits under the Plan by following<br \/>\nthe procedures prescribed by Schwab. If your claim is denied, generally you will<br \/>\nreceive written or electronic notification of the denial within 90 days of the<br \/>\ndate on which you filed the claim. If special circumstances require more time to<br \/>\nmake a decision about your claim, you will receive notification of when you may<br \/>\nexpect a decision. You may appeal the denial by submitting to the Plan<br \/>\nAdministrator a written request for review within 30 days of receiving<br \/>\nnotification of the denial. Your request should include all facts upon which<br \/>\nyour appeal is based. Generally, the Plan<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">7<\/p>\n<\/p>\n<hr>\n<table align=\"center\" width=\"100%\" cellpadding=\"0\" border=\"0\" cellspacing=\"0\">\n<tbody>\n<tr>\n<td width=\"18%\"><\/td>\n<td width=\"2%\" valign=\"bottom\"><\/td>\n<td width=\"80%\"><\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">Administrator will provide you with written or electronic<br \/>\nnotification of its decision within 90 days after receiving the review request.<br \/>\nIf special circumstances require more time to make a decision about your<br \/>\nrequest, you will receive notification of when you may expect a decision.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>Plan<\/strong><\/p>\n<p><strong>Administration<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">The Plan Administrator has discretionary authority to make<br \/>\nall determinations related to this award and to construe the terms of the Plan,<br \/>\nthe Notice of Restricted Stock Unit Award and this Agreement. The Plan<br \/>\nAdministrator153s determinations are conclusive and binding on all persons.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Adjustments<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">In the event of a stock split, a stock dividend or a similar<br \/>\nchange in Schwab stock, the number of Restricted Stock Units that remain subject<br \/>\nto forfeiture shall be adjusted accordingly.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Severability<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">In the event that any provision of this Agreement is held<br \/>\ninvalid or unenforceable, the provision will be severable from, and such<br \/>\ninvalidity or unenforceability will not be construed to have any effect on, the<br \/>\nremaining provisions of this Agreement.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\"><strong>Applicable Law<\/strong><\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">This Agreement will be interpreted and enforced under the<br \/>\nlaws of the State of Delaware (without regard to their choice-of-law<br \/>\nprovisions), as such laws are applied to contracts entered into and performed in<br \/>\nDelaware.<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td><\/td>\n<td colspan=\"2\"><\/td>\n<\/tr>\n<tr>\n<td valign=\"top\">\n<p><strong>The Plan and<\/strong><\/p>\n<p><strong>Other<\/strong><\/p>\n<p><strong>Agreements<\/strong><\/p>\n<\/td>\n<td valign=\"bottom\"><\/td>\n<td valign=\"bottom\">\n<p align=\"justify\">The text of the Plan is incorporated in this Agreement by<br \/>\nreference. This Agreement, the Notice of Restricted Stock Unit Award and the<br \/>\nPlan constitute the entire understanding between you and Schwab regarding this<br \/>\naward. Any prior agreements, commitments or negotiations concerning this award<br \/>\nare superseded. This Agreement may be amended only by another written agreement,<br \/>\nsigned by both parties and approved by the Compensation Committee. If there is<br \/>\nany inconsistency or conflict between any provision of this Agreement and the<br \/>\nPlan, the terms of the Plan will control.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p align=\"center\">8<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8775],"corporate_contracts_industries":[9418],"corporate_contracts_types":[9539,9546],"class_list":["post-40252","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-schwab-charles-corp","corporate_contracts_industries-financial__securities","corporate_contracts_types-compensation","corporate_contracts_types-compensation__incentive"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40252","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40252"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40252"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40252"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40252"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}