Exhibit 10.283
SEPARATION
AGREEMENT, GENERAL RELEASE AND WAIVER OF CLAIMS
This Separation Agreement, General
Release and Waiver of Claims (“Agreement”) is entered
into by and between William L. Atwell (“Mr. Atwell”),
on the one hand, and The Charles Schwab Corporation (the
“CSC”) and Charles Schwab & Co., Inc., their
subsidiaries, affiliates and predecessors, successors and assigns
(collectively “Schwab” or the “Company”),
on the other hand, dated as of the date both parties have executed
the Agreement (the “Execution Date”) and effective upon
the expiration of the Revocation Period described in Paragraph
26(g), below (“Effective Date”). Together,
Mr. Atwell and the Company shall be referred to herein as
“the Parties.”
RECITALS
WHEREAS , the Parties agree that Mr. Atwell stepped
down from his positions as Executive Vice President and President -
Individual Investor, on November 8, 2005 and the employment
relationship will end as of December 31, 2005;
WHEREAS , the Parties now desire to definitively
resolve, fully and finally, all differences, disputes and claims
Mr. Atwell might have against the Company and anyone connected
with it through and including the Execution Date, including, but
not limited to, those arising out of or relating to
Mr. Atwell’s employment relationship with Schwab and the
termination thereof.
NOW, THEREFORE,
in consideration of the mutual
covenants set forth herein and for other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the
Company and Mr. Atwell hereby agree as follows:
AGREEMENT
1. Separation from Positions
. Mr. Atwell stepped down as a Schwab officer, from any and
all Schwab directorships he holds, and from the Policy and
Executive Committees effective November 8, 2005 and will be
deemed to have retired on the last day of his employment as of
December 31, 2005 (“Separation Date”).
Mr. Atwell shall be treated as having retired on the
Separation Date for purposes of vesting of his long-term awards, as
set forth below, and for no other purpose, including the time
period to exercise vested stock options. Mr. Atwell
acknowledges and agrees that with the exception of his accrued
vacation and paychecks for the period November 16 through
December 31, 2005, he has received all wages due to him for
services rendered as a result of his employment with the Company up
to and including December 31, 2005. Mr. Atwell’s
allowance and related tax reimbursement for travel and related
expenses between his residences on the East Coast and various
Schwab business locations shall terminate as of December 1,
2005.
2. Consideration. Subject to
and upon satisfaction by Mr. Atwell of the terms and
conditions set forth in this Agreement, Schwab agrees to provide
Mr. Atwell the following consideration:
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(i)
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a lump sum
payment in the amount of nine hundred seventy-five thousand dollars
and no cents ($975,000.00), less usual and customary taxes,
withholding, and authorized deductions, payable within the next
payroll cycle following the Effective Date;
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(ii)
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Schwab will
cause to be fully vested and, in the case of stock options, fully
exercisable as of the Effective Date the following awards:
(a) all restricted shares under the Restricted Shares Award
Agreement dated February 25, 2003 and 51,000 restricted shares
under the Restricted Shares Award Agreement dated July 22,
2003; (b) all stock options under the Nonqualified Stock
Option Agreements dated February 27, 2002, July 16,
2002, November 8, 2002, and September 30, 2004;
(c) all stock options under the Incentive Stock Option
Agreement dated February 27, 2002; and (d) all units
under the Long Term Incentive Plan (“LTIP”) Award
Agreements for the performance periods beginning on January 1,
2003 and July 1, 2004, and 230,000 units under the LTIP Award
Agreement for the performance period beginning on July 1,
2005; provided, however, that such awards shall otherwise continue
to be subject to the terms of the applicable plan and award
agreement, except as provided in paragraph 6; and
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(iii)
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continued
eligibility to participate in the Corporate Executive Bonus Plan
for calendar year 2005 based on his target bonus percentage of 150%
of base salary, actual corporate and enterprise performance for
2005, and the pre-approved corporate and enterprise performance
matrices for 2005 under the Corporate Executive Bonus Plan,
adjusted for all bonuses earned and paid during 2005, and payable
at the time bonuses are paid under the terms of the
Plan.
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3. No Other Employee
Benefits. Mr. Atwell is not eligible for any other
benefits or payments not specifically provided for in this
Agreement. Mr. Atwell will be offered group health
continuation coverage under COBRA. Mr. Atwell will not be
eligible to accrue vacation or floating holidays after
December 31, 2005. Schwab will pay Mr. Atwell all accrued
but unused vacation and floating holidays accrued through
December 31, 2005 on the next regularly scheduled payday
following the Separation Date.
4. Waiver of Benefits under The
Charles Schwab Severance Pay Plan. Mr. Atwell acknowledges
and agrees that the consideration described in Paragraph 2, above,
is in lieu of and a substitute for any severance benefits he may
have been eligible to receive under The Charles Schwab Severance
Pay Plan or under any other severance or termination pay or
benefits for which he may be eligible from the Company.
Mr. Atwell expressly agrees that he waives any such rights or
benefits in exchange for the rights and benefits provided under
this Agreement.
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5. Retirement Savings and
Investment Plan. Mr. Atwell’s active participation
in the SchwabPlan Retirement Savings and Investment Plan shall
cease as of December 31, 2005. Mr. Atwell’s vested
interest in any Company contributions (other than matching
contributions under the Company’s 401(k) plan, which are
automatically fully vested) will be determined based on his service
through the Separation Date.
6. The Charles Schwab Corporation
Stock Incentive Plans. Under the provisions of the
Company’s stock incentive plans and applicable Stock Option
Agreement(s), Mr. Atwell retains the right to exercise vested
options for three (3) months after his Separation Date. In no
event shall Mr. Atwell be deemed to have terminated on account
of retirement for purposes of determining the period of time to
exercise vested stock options after his Separation Date. Any stock
options or restricted shares that are not vested as of his
Separation Date or that do not vest under Paragraph 2, above, are
immediately canceled. The applicable Stock Option or Restricted
Share Agreement(s) and Plan documents govern the vesting of options
and shares and exercising of stock options. Any LTIP units that are
not vested as of Mr. Atwell’s Separation Date or that do
not vest under Paragraph 2, above, are immediately forfeited. The
LTIP Award Agreement and Plan document govern the vesting of LTIP
units.
7. Tax Treatment.
Mr. Atwell understands and agrees that Schwab is providing no
tax or legal advice, and makes no representations regarding tax
obligations or consequences, if any, related to any part of this
Agreement, including any consequences that may result with respect
to the modification of stock options pursuant to section 409A of
the Internal Revenue Code of 1986, as amended (the
“Code”). Mr. Atwell further agrees that he will be
responsible for his tax obligations or consequences that may arise
from this Agreement, and he shall not seek any indemnification from
Schwab in this regard. Mr. Atwell further agrees to indemnify
and hold Schwab harmless from any claims, demands, deficiencies,
levies, assessments, executions, judgments, penalties, taxes,
attorneys’ fees or recoveries by any governmental entity
against Schwab for any failure by Mr. Atwell to pay his taxes
due and owing, if any, as a result of any payments under this
Agreement. The Agreement is not intended to constitute a
“nonqualified deferred compensation plan” within the
meaning of section 409A of the Code. Notwithstanding the foregoing,
in the event this Agreement or any benefit paid to Mr. Atwell
hereunder is deemed to be subject to section 409A of the Code,
Mr. Atwell consents to the Company adopting such conforming
amendments as the Company deems necessary, in its sole discretion,
to comply with section 409A of the Code, without reducing the
amounts of any benefits due to Mr. Atwell
hereunder.
8. Withholding Taxes for
Restricted Shares. Mr. Atwell agrees to provide payment in
cash or cash equivalents to enable Schwab to satisfy all
withholding requirements by reason of the vesting of restricted
shares pursuant to Paragraph 2(ii)(a). Mr. Atwell understands
that no shares will be issued to him pursuant to Paragraph 2(ii)(a)
until such obligation is satisfied.
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9. No Filings.
Mr. Atwell represents that as of the Execution Date, he has
not filed any lawsuit, claim, charge, or complaint against Schwab
or any other Releasee identified in Paragraph 11 below, with any
local, state, or federal agency or court or self-regulatory
organization (“SRO”), and that he will not make such a
filing at any time hereafter based upon any events or omissions
occurring prior to and up to the Execution Date. In the event that
any agency or court assumes jurisdiction of any lawsuit, claim,
charge or complaint, or purports to bring any legal or regulatory
proceedings against Schwab or any other Releasee identified in
Paragraph 11 below on Mr. Atwell’s behalf, he promptly
will request that the agency, court, or SRO, withdraw from or
dismiss the lawsuit, claim, charge, or complaint with
prejudice.
10. Covenant Not to Sue.
Mr. Atwell covenants that he will not file, participate in, or
instigate the filing of any lawsuits, claims, charges, or
complaints by himself or by any other person or party in any local,
state or federal agency or court or SRO, except as required by law,
claiming that Schwab or any other Releasee identified in Paragraph
11 below has violated any law or obligation based upon events or
omissions occurring prior to and including the Effective Date of
this Agreement. Notwithstanding the provisions of this paragraph,
nothing in this Agreement shall be construed to preclude
Mr. Atwell from timely filing a complaint with the U.S. Equal
Employment Opportunities Commission (“EEOC”) or
assisting any investigation conducted by the EEOC to the extent
that such rights are not subject to waiver. In the event
Mr. Atwell breaches the covenant contained in this Paragraph
10, Mr. Atwell agrees that he will indemnify Schwab and any
other Releasee identified in Paragraph 11 below for all damages,
fees, costs and expenses, including legal fees, incurred by Schwab
or any other Releasee identified in Paragraph 11 below, in
defending, participating in, or investigating any matter or
proceeding covered by this Paragraph 10. Furthermore,
Mr. Atwell gives up all rights to individual damages in
connection with any administrative or court proceeding with respect
to his employment with or termination of employment from Schwab. If
Mr. Atwell is awarded money damages, he agrees to assign to
Schwab his right and interest to such money damages.
11. Complete Release by
Mr. Atwell . Mr. Atwell – for himself and for
his heirs, representatives, attorneys, executors, administrators,
successors, and assigns – releases Schwab, and all of its
affiliates, subsidiaries, divisions, parent corporations, and
stockholders, officers, directors, partners, servants, agents,
employees, representatives, attorneys, employee welfare and
retirement plans and the respective plan administrators and
fiduciaries, past, present, and future, all persons acting under,
by, through, or in concert with any of them, and each of them (all
of whom are hereinafter referred to as “Releasees”),
from any and all actions, causes of action, grievances,
obligations, costs, expenses, damages, losses, claims, liabilities,
suits, debts, demands, and benefits (including attorneys’
fees and costs actually incurred), of whatever character, in law or
in equity, known or unknown, suspected or unsuspected, matured or
unmatured, of any kind or nature whatsoever, based on any act,
omission, event, occurrence, or nonoccurrence from the beginning of
time up to and including the Execution Date of this Agreement,
including but not limited to any claims or causes of action arising
out of or in any way relating to Mr. Atwell’s employment
relationship with Schwab or any other Releasee.
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This release of claims includes, but
is not limited to, claims for breach of any implied or express
contract or covenant; claims for promissory estoppel; claims of
entitlement to any pay (other than the payments promised in
Paragraph 2); claims of wrongful denial of insurance and employee
benefits, or any claims for wrongful termination, public policy
violations, defamation, invasion of privacy, fraud,
misrepresentation, unfair business practices, emotional distress or
other common law or tort matters; claims of harassment, retaliation
or discrimination under federal, state, or local law; claims based
on any federal, state or other governmental statute, regulation or
ordinance, including, without limitation, Title VII of the Civil
Rights Act, as amended, the Age Discrimination in Employment Act,
the Older Worker Benefit Protection Act, the Labor Management
Relations Act, the Americans with Disabilities Act, the Family and
Medical Leave Act, the New York Human Rights Law, the New York City
Administrative Code, the New York Labor Law, the California Fair
Employment and Housing Act, the California Labor Code, the
California Government Code, and the Employee Retirement Income
Security Act of 1974; and claims under the state or federal
constitution. It is expressly understood by Mr. Atwell that
among the various rights and claims being waived by Mr. Atwell
in this Agreement are those for age discrimination arising under
the Age Discrimination in Employment Act of 1967 (29 U.S.C. sec.
621, et seq. ), as amended. Specifically excluded from this
paragraph are claims for reasonable and necessary expenses
(including legal/tax accounting expenses for re-filing tax returns
and any penalties imposed by federal or state taxing authorities)
arising out of the reclassification of certain expenses in 2003 and
2004 for travel between Mr. Atwell’s residences on the
East Coast and Schwab’s business locations (including travel
on company aircraft), as personal, rather than business,
expenses.
12. Release of Unknown
Claims. In order to make this release effective as to unknown,
unsuspected or concealed claims, Mr. Atwell expressly waives
the benefits of Section 1542 of the California Civil Code,
which provides:
A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR.
In making this waiver,
Mr. Atwell acknowledges that he may hereafter discover facts
in addition to or different from those which he now believes to be
true with respect to the subject matter released herein, but agrees
that he has taken that possibility into account in reaching this
Agreement and that, notwithstanding the discovery or existence of
any such additional or different facts, Mr. Atwell fully,
finally, and forever settles and releases any and all such
claims.
13. Successors. This
Agreement shall be binding upon the Parties, and their heirs,
representatives, executors, administrators, successors, insurers,
and assigns, and shall inure to the administrators, predecessors,
successors, and assignees of each of the Parties. In the event of
Mr. Atwell’s death, the benefits payable to
Mr. Atwell under this Agreement shall inure to the benefit of
his heirs, successors, and assigns.
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14. Indemnification. Nothing
in this Agreement (including the release contained herein) shall be
construed to limit Mr. Atwell’s right to indemnification
or contribution pursuant to Delaware or California law or the
Company’s bylaws arising from actions actually or allegedly
taken in the scope of his employment with the Company.
15. No Attor
