The Committee reserves the right, in its sole discretion, to waive forfeiture or accelerate vesting in whole or part. You have no right to any such discretionary waiver or acceleration. If a request for a waiver were granted, only the units not covered by the waiver would forfeit.
This award is governed by the substantive laws of Tennessee, without regard to conflicts of laws principles. To the extent applicable to this award and to you, the forfeiture and recovery provisions of this award, and of the Policy and Procedures, may be limited by the laws of another state associated with where you live or work. If a court of competent jurisdiction determines that any of those provisions is unlawful or prohibited by law as applied to this particular award, then those provisions shall be deemed modified, reduced, or otherwise cut back to the minimum extent possible in order to preserve the original provision to the maximum extent possible, consistent with applicable state law as applied to this award and to you.
RSUs are not shares of stock, have no voting rights, and are not transferable. If explicitly permitted by the Committee and FH, you may make a beneficiary designation that will direct FH to treat your beneficiary as the owner of this award after you die. Any such designation, if permitted at all, will be effective only if done in compliance with the Procedures and the rules of FH’s administrative vendor for stock awards in effect at the time of designation. Also, the effectiveness of designations will be subject to all conditions and limitations contained in the Procedures and in the rules of that vendor in effect at the time of your death.
Each RSU that vests will result in one share of FH common stock being issued to you, subject to withholding for taxes. Subject to provisions of the Governing Plan, the Committee may choose to pay all or a portion of vested RSUs in cash, based on the fair market value of FH common stock on the Vesting Date.
Your RSUs will accrue cash dividend equivalents to the extent cash dividends are paid on common shares prior to vesting. From the Grant Date until the Vesting Date, dividend equivalents accumulate (without interest) as if each RSU were an outstanding share. To the extent that RSUs vest, the accumulated dividend equivalents associated with vested RSUs will be paid in cash shortly after vesting. Dividend equivalents associated with forfeited RSUs likewise are forfeited.
The number of RSUs will be adjusted proportionately in the event of a stock split or a common stock dividend to avoid any enlargement or dilution of value. Subject to the Governing Plan and Procedures, in each such adjustment RSUs will be rounded down to the nearest whole unit; any fractional RSU will be disregarded.
Vesting is a taxable event for you. Your withholding and other taxes will depend upon FH’s stock value on the Vesting Date and the amount of dividend equivalents paid to you. As of the Grant Date, the Committee’s Procedures provide that FH will withhold shares and cash at vesting in the amount necessary to cover your withholding taxes;
however, the Procedures may be changed at any time. You are not permitted to make any election under Section 83(b) of the Internal Revenue Code of 1986, as amended, to include in your gross income for federal income tax purposes the value of this award this year. If you make a Section 83(b) election, this award will forfeit.
The TD Merger will affect this award. First, the Merger will result in a Change in Control of FH on the Merger’s Closing Date for purposes of the Governing Plan. A Change in Control will not accelerate vesting of this award under the Governing Plan, but acceleration may occur afterward if you experience a Qualifying Termination of your employment (see the next paragraph for an exception for this award). Second, the agreement governing the TD Merger provides that, after the Merger closes, your RSUs will convert from shares of FH to shares of TD, with the number of shares adjusted based on the market value of TD’s common shares near the closing time in relation to the merger transaction value of FH common shares. For example, if the applicable TD stock value were $75/share and the merger transaction value of FH stock were $25/share, the number of your TD RSUs would be one-third of the number of your FH RSUs, so that the after-conversion value of your RSUs would be equal to the pre-conversion value. Please refer to the Governing Plan and the TD Merger agreement for additional information regarding these topics.
Special Leader Group RSUs, including this award, have an exception to the usual Qualifying Termination outcome in relation to the TD Merger. If the TD Merger closes, if you have Good Reason to resign after the Closing Date, and if you follow the applicable procedures in the Governing Plan to notify FH and allow FH to remedy the issue, you may resign but, for these Special Leader Group RSUs to accelerate, your departure from resignation must occur no less than six months after the Closing Date. If your employment ends sooner, your resignation will not be a Qualifying Termination for these RSUs and instead will result in forfeiture, even if you have Good Reason and you follow the procedures, and even if other RSU awards you may have are accelerated. For the TD Merger, you are permitted, in a Good Reason resignation notice to FH, to specify a future departure date compliant with the six month delay required in order for this award to accelerate.
Questions about your RSU award?
Important information concerning the Governing Plan and this RSU award is contained in a prospectus. Copies of the current prospectus (including all applicable supplements) are delivered separately, and you may request a copy of the Governing Plan or prospectus at any time. If you have questions about your RSU award or need a copy of the Governing Plan, related prospectus, or current Procedures, please contact Fidelity’s Stock Plan Services Representative at ______________. For all your personal stock incentive information, you may view your award and other information on Fidelity’s website at ___________.
