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The
LTIP and Other Agreements
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This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Restricted Stock Units, subject to the terms of
the LTIP. Any prior agreements, commitments, or negotiations
are superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern. Capitalized terms that are not defined in this
Agreement are defined in the LTIP. In the event of any conflict
or inconsistency between the provisions of this Agreement and the PG&E
Corporation Officer Severance Policy, this Agreement shall govern. For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
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Grant
of Restricted Stock Units
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PG&E
Corporation grants you the number of Restricted Stock Units shown on the
cover sheet of this Agreement. The Restricted Stock Units are
subject to the terms and conditions of this Agreement and the
LTIP.
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Vesting
of Restricted Stock Units
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As
long as you remain employed with PG&E Corporation, 100 percent of the
total number of Restricted Stock Units originally subject to this
Agreement, as shown above on the cover sheet, will vest on the first
business day of January of 2012 (the “Vesting Date”). Except as
described below, all Restricted Stock Units subject to this Agreement
which have not vested shall be cancelled upon termination of your
employment.
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Dividends
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Restricted
Stock Units will accrue Dividend Equivalents that will be converted into
additional Restricted Stock Units based on the Fair Market Value of a
share of PG&E Corporation common stock on the dividend payment
date. Such additional Restricted Stock Units will be subject to
the same terms and conditions as the underlying Restricted Stock
Units.
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Settlement
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Vested
Restricted Stock Units will be settled in an equal number of shares of
PG&E Corporation common stock. PG&E Corporation shall issue such
shares as soon as practicable after the Restricted Stock Units vest upon Vesting Date (but not later than ninety (90)
days after the Vesting Date); provided, however, that such issuance shall
be made with respect to all of your outstanding vested Restricted Stock
Units (after giving effect to the vesting provisions described below) as
soon as practicable after (but not later than ninety (90) days
after) your separation from service (within
the meaning of Code Section 409A), if such separation occurs earlier than
the Vesting
Date.
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Voluntary
Termination/ Retirement1
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In
the event of your voluntary termination/Retirement, a prorated portion of
the Restricted Stock Units will vest at the
time of your separation from service in accordance with the
percentage of time you were employed with PG&E Corporation during the
vesting period. All other unvested Restricted Stock Units shall
be cancelled on the date of termination.
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Termination
for Cause
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If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all Restricted Stock Units
will be cancelled on the date of termination. In general,
termination for “cause” means termination of employment because of
dishonesty, a criminal offense or violation of a work rule, and will be
determined by and in the sole discretion of PG&E
Corporation.
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Termination
other than for Cause
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If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, a prorated
portion of the Restricted Stock Units will vest at the time of your separation from service
in accordance with the percentage of time you were employed with PG&E
Corporation during the vesting period (except as otherwise provided below
in connection with a Change in Control). All other unvested
Restricted Stock Units shall be cancelled on the date of
termination.
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Death/Disability
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If
you separate from service due to your
death or Disability, all of your Restricted Stock Units shall vest on the
date of separation.
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Termination
Due to Disposition of Subsidiary
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(1)
If your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Internal Revenue Code of 1986, as
amended (the “Code”), or (2) if your employment is terminated (other than
for cause or your voluntary termination) coincident with the sale of all
or substantially all of the assets of a subsidiary of PG&E
Corporation, the Restricted Stock Units shall vest in the same manner as
for a “Termination other than for Cause” described above.
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Change
in Control
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In
the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or other business entity or parent thereof, as the
case may be (the “Acquiror”), may, without your
consent, either assume or continue PG&E Corporation’s rights and
obligations under this Agreement or provide a substantially equivalent
award in substitution for the Restricted Stock Units subject to this
Agreement.
If
the Restricted Stock Units are neither assumed nor continued by the
Acquiror or if the Acquiror does not provide a substantially equivalent
award in substitution for the Restricted Stock Units, all of your
outstanding Restricted Stock Units shall automatically vest immediately
preceding and contingent on, the Change in Control and shall be settled on the Vesting Date, subject to
earlier settlement upon your separation from
service.
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Termination
In Connection with a Change in Control
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If
your employment is terminated by PG&E
Corporation (other than
for cause) (i) following a Potential
Change in Control (defined below) or
(ii) within two years following the Change in Control, all of your
outstanding Restricted Stock Units (to the extent they did not previously
vest upon, for example, failure of the Acquiror to assume or continue this
Award) shall automatically vest on the date of your separation from service.
"Potential Change in Control" shall mean the
earliest to occur of (i) the date on which the PG&E
Corporation executes an agreement or letter of intent, where the
consummation of the transaction described therein would result in the
occurrence of a Change in Control, (ii) the date on which the Board of
Directors of PG&E Corporation approves a transaction or series of
transactions, the consummation of which would result in a Change in
Control, or (iii) the date on which a tender offer for PG&E
Corporation’s voting stock is publicly announced, the completion of which
would result in a Change in Control.
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Delay
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PG&E
Corporation shall delay the issuance of any shares of common stock to the
extent it is necessary to comply with Section 409A(a)(2)(B)(i) of the Code
(relating to payments made to certain “key employees” of certain
publicly-traded companies); in such event, any shares of common stock to
which you would otherwise be entitled during the six (6) month period
following the date of your “separation from service” under Section 409A
(or shorter period ending on the date of
your death following such separation) will instead be issued on the
first business day following the expiration of the applicable delay period.
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Withholding
Taxes
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Prior to any event in connection with the
Restricted Stock Units (e.g., vesting) that PG&E Corporation
determines may result in any tax withholding obligation, whether United
States federal, state, local, or non-U.S., including any social insurance,
employment tax, payment on account, or other tax-related obligation (the
“Tax Withholding Obligation”), you must arrange for the satisfaction of
the minimum amount of such Tax Withholding Obligation in a manner
acceptable to PG&E Corporation.
At any time not less than five (5) business days
(or such fewer number of business days as determined by PG&E
Corporation) before any Tax Withholding Obligation arises (e.g., a Vesting
Date), you may instruct PG&E Corporation to withhold from those shares
otherwise issuable to you the whole number of shares sufficient to satisfy
the minimum applicable Tax Withholding Obligation. You
acknowledge that the withheld shares may not be sufficient to satisfy your
minimum Tax Withholding Obligation. Accordingly, you agree to
pay to PG&E Corporation as soon as practicable, including through
additional payroll withholding, any amount of the Tax Withholding
Obligation that is not satisfied by the withholding of shares described
above.
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Leaves
of Absence
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For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation sponsored disability benefits, you will be considered to have
voluntarily terminated your employment. See above under
“Voluntary Termination/Retirement.”
Notwithstanding
the foregoing, if the leave of absence exceeds six (6) months, and a
return to service upon expiration of such leave is not guaranteed by
statute or contract, then you shall be deemed to have had a “separation from service”
for purposes of any Restricted Stock Units
that are settled hereunder upon such separation. To the
extent an authorized leave of absence is due to a medically determinable
physical or mental impairment that can be expected to result in death or
to last for a continuous period of at least six (6) months and such
impairment causes you to be unable to perform the duties of your position
of employment or any substantially similar position of employment, the six
(6) month period in the prior sentence shall be twenty-nine (29)
months.
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
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Voting
and Other Rights
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You
shall not have voting rights with respect to the Restricted Stock Units
until the date the underlying shares are issued (as evidenced by
appropriate entry on the books of PG&E Corporation or its duly
authorized transfer agent).
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No
Retention Rights
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This
Agreement is not an employment agreement and does not give you the right
to be retained by PG&E Corporation. Except as otherwise
provided in an applicable employment agreement, PG&E Corporation
reserves the right to terminate your employment at any time and for any
reason.
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Applicable
Law
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This
Agreement will be interpreted and enforced under the laws of the State of
California.
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