Exhibit 10.318

THE CHARLES SCHWAB CORPORATION

2004 STOCK INCENTIVE PLAN

NOTICE OF RESTRICTED STOCK AWARD

(PERFORMANCE-BASED VESTING)

You have been granted restricted shares of Common Stock of The Charles Schwab
Corporation (“Schwab”) under the Charles Schwab Corporation 2004 Stock Incentive
Plan (the “Plan”) on the following terms:

 

Name of Recipient:    Total Number of Shares Granted:    Fair Market Value per
Share:    Total Fair Market Value of Award:    Grant Date:    Vesting Schedule:
   So long as you remain in service in good standing and subject to the terms of
the Restricted Stock Agreement and certification of the Performance Goal by
Schwab’s Compensation Committee, this award vests on the following Vesting
Dates, as follows:

Number of Shares on Vesting Date

 

Percentage of the Total Number of

Shares Granted under this Award

That Will Vest

  

Vesting Date

25%    25%    25%    25%   

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The number of shares indicated will vest only if Schwab’s Compensation Committee
certifies that as of the Vesting Date next to the number of shares, Schwab has
satisfied the Performance Goal for the applicable one-year period from
October 1st to September 30th ending prior to such Vesting Date.

The Performance Goal shall be: [    ]

Except as otherwise provided in the Restricted Stock Agreement, if the
Performance Goal is not met for any one-year period, the number of shares that
otherwise would vest as of the Vesting Date for such one-year period will
automatically and permanently be forfeited. Any vested shares will be paid as
soon as administratively possible.

You and Schwab agree that this award is granted under and governed by the terms
and conditions of the Plan and the Restricted Stock Agreement, both of which are
made a part of this notice. Please review the Restricted Stock Agreement and the
Plan carefully, as they explain the terms and conditions of this award. You
agree that Schwab may deliver electronically all documents relating to the Plan
or this award (including, without limitation, prospectuses required by the
Securities and Exchange Commission) and all other documents that Schwab is
required to deliver to its stockholders. By accepting this award, you agree to
all of the terms and conditions described above, in the Restricted Stock
Agreement and in the Plan, and you have no right whatsoever to change or
negotiate such terms and conditions.

THE CHARLES SCHWAB CORPORATION

2004 STOCK INCENTIVE PLAN

RESTRICTED STOCK AGREEMENT

(PERFORMANCE-BASED VESTING)

 

Payment for Shares    No payment is required for the shares that you are
receiving. Vesting    Subject to the provisions of this Agreement, this award
becomes vested as described in the Notice of Restricted Stock Award, of which
this Restricted Stock Agreement is a part. Unvested shares will be considered
“Restricted Shares.” If your service terminates for any reason, then your shares
will automatically and permanently be forfeited to the extent that they have not
vested before the termination date and do not vest as a result of the
termination, unless otherwise noted below. This means that the Restricted Shares
will immediately revert to Schwab. You will receive no payment for Restricted
Shares that are forfeited. Schwab determines when your service terminates for
this purpose. For all purposes of this

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   Agreement, “service” means continuous employment as a common-law employee of
Schwab or a parent company or subsidiary of Schwab, and “subsidiary” means a
subsidiary corporation as defined in section 424(f) of the Internal Revenue Code
of 1986, as amended (the “Code”). Accelerated Vesting    This award, to the
extent not already forfeited, will become fully vested if your service
terminates on account of your death or disability. If, prior to the date your
service terminates, Schwab is subject to a “change in control” (as defined in
the Plan document), this award, to the extent not already forfeited, will become
fully vested as of the date that the change in control occurs. Continued Vesting
  

If your service terminates on account of your retirement and your retirement
occurs at least two years after the Grant Date indicated in the Notice of
Restricted Stock Award, you will be treated as in service in good standing for
purposes of determining further vesting of the award.

 

If you are entitled to severance benefits under The Charles Schwab Severance Pay
Plan (or any successor plan), then you may be treated as in service in good
standing during your Severance Period for purposes of determining further
vesting of the award under the terms of that plan.

Definition of Disability    For all purposes of this Agreement, “disability”
means that you have a disability such that you have been determined to be
eligible for benefits under Schwab’s long-term disability plan. Definition of
Retirement   

If you are an employee of Schwab and its subsidiaries, “retirement” means
termination of service for any reason other than death at any time after you
attain age 55, but only if, at the time of your termination, you have been
credited with at least 10 years of service.

 

The phrase “years of service” above has the same meaning given to it under the
SchwabPlan Retirement Savings and Investment Plan (or any successor plan).

Section 83(b) Election    You may make an election pursuant to Section 83(b) of
the Code within 30 days of the Grant Date to be taxed on the Restricted Shares
prior to vesting. Shares Restricted    You may not sell, transfer, pledge or
otherwise dispose of any Restricted Shares without Schwab’s written consent
until they are vested. Restricted Shares will be issued in your name but held by
the Schwab Corporate Secretary as escrow agent. Schwab may instruct the transfer
agent for its stock to place a legend on the certificates representing the
Restricted Shares or may note in its records the applicable restrictions. The
escrow

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agent will deliver Restricted Shares to you only after they become vested and
after all other terms and conditions in this Agreement have been satisfied.

 

You may make a gift of Restricted Shares to your spouse, children or
grandchildren or to a trust established by you for the benefit of yourself or
your spouse, children or grandchildren. However, a transferee of Restricted
Shares must agree in writing on a form prescribed by Schwab to be bound by all
provisions of this Agreement as a condition for the transfer prior to the
Restricted Shares becoming vested.

Delivery of Shares After Death    In the event of your death prior to the date
your service terminates, your shares will be delivered to your beneficiary or
beneficiaries. You may designate one or more beneficiaries by filing a
beneficiary designation form. You may change your beneficiary designation by
filing a new form with Schwab at any time prior to your death. If you do not
designate a beneficiary or if your designated beneficiary predeceases you, then,
your shares will be delivered to your estate. The Compensation Committee, in its
sole discretion, will determine the form and time of the distribution of shares
to your estate. Restrictions on Resale    You agree not to sell any shares at a
time when applicable laws, Schwab’s policies or an agreement between Schwab and
its underwriters prohibit a sale. This restriction will apply as long as your
service continues and for such period of time after the termination of your
service as Schwab may specify. Withholding Taxes    The Restricted Shares will
not be released to you unless you have made acceptable arrangements to pay any
applicable withholding of income and employment taxes that may be due as a
result of this award or the vesting of the shares. With Schwab’s consent, these
arrangements may include without limitation withholding shares of Schwab stock
that otherwise would be issued to you when they vest. In its sole discretion,
Schwab may withhold the minimum number of whole shares of Schwab stock, valued
at the fair market value on the vesting date, required to satisfy such
applicable withholding taxes. Any residual amount of applicable withholding
taxes, i.e., amounts of less than the fair market value of a share, may be
deducted from your pay. Stockholder Rights    As a holder of Restricted Shares,
you have the same voting, dividend and other rights as Schwab’s stockholders.
Dividends paid in cash shall not be eligible for The Dividend Reinvestment &
Stock Purchase Plan.

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Contribution of Par Value    On your behalf Schwab will contribute to its
capital an amount equal to the par value of the Restricted Shares issued to you.
No Right to Remain Employee    Nothing in this Agreement will be construed as
giving you the right to be retained as an employee, contingent worker or
director of Schwab and its subsidiaries for any specific duration or at all.
Limitation on Payments   

If a payment from the Plan would constitute an excess parachute payment under
section 280G of the Code or if there have been certain securities law
violations, then your award may be reduced or forfeited and you may be required
to disgorge any profit that you have realized from your award.

 

If a disqualified individual receives a payment or transfer under the Plan that
would constitute an excess parachute payment under 280G of the Code, such
payment will be reduced, as described below. Generally, someone is a
“disqualified individual” if he or she is (a) an officer of Schwab, (b) a member
of the group consisting of the highest paid 1% of the employees of Schwab or, if
less, the highest paid 250 employees of Schwab, or (c) a 1% stockholder of
Schwab. For purposes of the section on “Limitation on Payments,” the term
“Schwab” will include affiliated corporations to the extent determined by the
Auditors in accordance with section 280G(d)(5) of the Code.

 

In the event that the independent auditors most recently selected by the Schwab
Board of Directors (the “Auditors”) determine that any payment or transfer in
the nature of compensation to or for your benefit, whether paid or payable (or
transferred or transferable) pursuant to the terms of the Plan or otherwise (a
“Payment ”), would be nondeductible for federal income tax purposes because of
the provisions concerning “excess parachute payments” in section 280G of the
Code, then the aggregate present value of all Payments will be reduced (but not
below zero) to the Reduced Amount; provided, however, that the Compensation
Committee may specify in writing that the award will not be so reduced and will
not be subject to reduction under this section.

 

For this purpose, the “Reduced Amount ” will be the amount, expressed as a
present value, which maximizes the aggregate present value of the Payments
without causing any Payment to be nondeductible by Schwab because of section
280G of the Code.

 

If the Auditors determine that any Payment would be nondeductible because of
section 280G of the Code, then Schwab will promptly give you notice to that
effect and a copy of the detailed calculation and of the Reduced Amount. You may
then elect, in your discretion, which and how much of the Payments will be
eliminated or reduced (as long as after such

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election, the aggregate present value of the Payments equals the Reduced
Amount). You will advise Schwab in writing of your election within 10 days of
receipt of the notice.

 

If you do not make such an election within the 10-day period, then Schwab may
elect which and how much of the Payments will be eliminated or reduced (as long
as after such election the aggregate present value of the Payments equals the
Reduced Amount). Schwab will notify you promptly of its election. Present value
will be determined in accordance with section 280G(d)(4) of the Code. The
Auditors’ determinations will be binding upon you and Schwab and will be made
within 60 days of the date when a Payment becomes payable or transferable.

 

As promptly as practicable following these determination and elections, Schwab
will pay or transfer to or for your benefit such amounts as are then due to you
under the Plan, and will promptly pay or transfer to or for your benefit in the
future such amounts as become due to you under the Plan.

 

As a result of uncertainty in the application of section 280G of the Code at the
time of an initial determination by the Auditors, it is possible that Payments
will have been made by Schwab which should not have been made (an “Overpayment”)
or that additional Payments which will not have been made by Schwab could have
been made (an “Underpayment”), consistent in each case with the calculation of
the Reduced Amount. In the event that the Auditors, based upon the assertion of
a deficiency by the Internal Revenue Service against you or Schwab which the
Auditors believe has a high probability of success, determine that an
Overpayment has been made, such Overpayment will be treated for all purposes as
a loan to you which you will repay to Schwab on demand, together with interest
at the applicable federal rate provided in section 7872(f)(2) of the Code.
However, no amount will be payable by you to Schwab if and to the extent that
such payment would not reduce the amount which is subject to taxation under
section 4999 of the Code. In the event that the Auditors determine that an
Underpayment has occurred, such Underpayment will promptly be paid or
transferred by Schwab to or for your benefit, together with interest at the
applicable federal rate provided in section 7872(f)(2) of the Code.

Claims Procedure    You may file a claim for benefits under the Plan by
following the procedures prescribed by Schwab. If your claim is denied,
generally you will receive written or electronic notification of the denial
within 90 days of the date on which you filed the claim. If special
circumstances require more time to make a decision about your claim, you will
receive

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   notification of when you may expect a decision. You may appeal the denial by
submitting to the Plan Administrator a written request for review within 30 days
of receiving notification of the denial. Your request should include all facts
upon which your appeal is based. Generally, the Plan Administrator will provide
you with written or electronic notification of its decision within 90 days after
receiving the review request. If special circumstances require more time to make
a decision about your request, you will receive notification of when you may
expect a decision. Plan Administration    The Plan Administrator has
discretionary authority to make all determinations related to this award and to
construe the terms of the Plan, the Notice of Restricted Stock Award and this
Agreement. The Plan Administrator’s determinations are conclusive and binding on
all persons. Adjustments    In the event of a stock split, a stock dividend or a
similar change in Schwab stock, the number of Restricted Shares that remain
subject to forfeiture shall be adjusted accordingly. Severability    In the
event that any provision of this Agreement is held invalid or unenforceable, the
provision will be severable from, and such invalidity or unenforceability will
not be construed to have any effect on, the remaining provisions of this
Agreement. Applicable Law    This Agreement will be interpreted and enforced
under the laws of the State of Delaware (without regard to their choice-of-law
provisions), as such laws are applied to contracts entered into and performed in
Delaware. The Plan and Other Agreements    The text of the Plan is incorporated
in this Agreement by reference. This Agreement, the Notice of Restricted Stock
Award and the Plan constitute the entire understanding between you and Schwab
regarding this award. Any prior agreements, commitments or negotiations
concerning this award are superseded. This Agreement may be amended only by
another written agreement, signed by both parties and approved by the
Compensation Committee. If there is any inconsistency or conflict between any
provision of this Agreement and the Plan, the terms of the Plan will control.