UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
December 7, 2004
Date of Report (Date of earliest event reported)
THE CHARLES SCHWAB CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware 1-9700 94-3025021
(State or other jurisdiction Commission (I.R.S. Employer
of incorporation or organization) File Number Identification Number)
120 Kearny Street, San Francisco, CA 94108
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (415) 627-7000
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
THE CHARLES SCHWAB CORPORATION
Item 1.01 Entry into a Material Definitive Agreement
On December 8, 2004, at a meeting of the Board of Directors of The Charles
Schwab Corporation (the Company), the Compensation Committee of the Board of
Directors (the Committee) approved amendments to The Charles Schwab Corporation
Deferred Compensation Plan and The Charles Schwab Corporation Directors'
Deferred Compensation Plan (the Existing Plans). The amendments cease all
deferrals under the Existing Plans except deferrals relating to compensation
earned prior to January 1, 2005. On the same date, the Committee adopted The
Charles Schwab Corporation Deferred Compensation Plan II and The Charles Schwab
Corporation Directors' Deferred Compensation Plan II (the New Plans) to permit
deferrals relating to compensation earned on and after January 1, 2005. The New
Plans incorporate substantially similar terms and conditions as are contained in
the Existing Plans but incorporate such changes as are necessary and appropriate
to comply with the requirements of the American Jobs Creation Act of 2004 (the
Act).
The Charles Schwab Corporation Deferred Compensation Plan II permits certain
officers of the Company to defer the payment of certain cash compensation they
may earn. Deferrals are credited with assumed earnings based on a
participant-directed investment arrangement that is similar to the arrangement
for the Company's defined contribution plan. Subject to applicable tax laws
(including provisions of the Act), deferrals and assumed earnings are paid to
the participant, or the participant's beneficiary in the event of the
participant's death, according to a time or schedule specified by the
participant. Payment of deferrals and assumed earnings may also be made upon
separation from service, death, disability, unforeseeable emergency or a change
in control of the Company. All deferrals and assumed earnings are unfunded and
subject to the claims of creditors.
The Charles Schwab Corporation Directors' Deferred Compensation Plan II permits
directors of the Company and U.S. Trust Corporation, a subsidiary of the
Company, to defer the payment of directors' fees that they may earn. At the
election of the participant, deferrals may be converted into fully vested
restricted stock units or nonqualified stock options of equivalent value
pursuant to the Company's 2004 Stock Incentive Plan. If the participant elects
restricted stock units, then the Company will issue an equivalent number of
shares of Company common stock to a grantor trust. All restricted stock units
are settled in shares of Company common stock and are paid in a lump sum from
the trust by the end of February in the year immediately following the
participant's termination of service. If the participant elects nonqualified
stock options, the exercise price will be equal to the fair market value of
Company common stock on the date of grant.
On December 7, 2004, the Board of Directors of U.S. Trust Corporation approved
an amendment to the Executive Deferred Compensation Plan of U.S. Trust
Corporation (the EDCP). Under the amendment, deferrals under the EDCP cease as
of December 31, 2004. Certain officers are authorized to prepare and implement a
successor EDCP that complies with the Act.
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THE CHARLES SCHWAB CORPORATION
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE CHARLES SCHWAB CORPORATION
(Registrant)
Date: December 10, 2004 /s/ Christopher V. Dodds
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Christopher V. Dodds
Executive Vice President and
Chief Financial Officer
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