Performance Share Unit (PSU) Plan
Overview
• PSUs granted under the PSU Plan are bookkeeping entries credited to an account created for each Participant. • Each PSU represents a unit with an underlying value equivalent to the value of one CWB common share, subject to adjustment by the performance multiplier. • Notional dividends accrue to the PSU holder and are converted on the dividend date into additional PSUs that vest in accordance with the respective grant. • On the grant date for PSUs, the value of the applicable allocation (based on a percentage of base salary as shown on the table on page 43) is divided by the weighted average trading price of one CWB common share on the grant date and the four trading days preceding the grant date to arrive at the number of PSUs granted to the executive. • PSUs vest on a date specified by the HR Committee at the date of grant, typically three years but in no event later than December 31 of the third year after the grant. • If a Participant ceases to be an employee before a PSU's vesting date by reason of death or retirement, then the PSUs will vest in accordance with the terms of the PSU Plan as if the Participant was an employee on the PSU vesting date. • Subject to Board discretion, if a Participant's employment ceases for any reason other than death or retirement, all of the Participant's unvested PSUs are cancelled and no compensation is paid for those PSUs. • Upon a change of control, PSUs vest immediately if both of the following conditions are met: (i) the Participant’s office or position is eliminated or substantially changed, and (ii) the Participant leaves the employment of CWB Financial Group within 18 months of the change of control. • In the event of accelerated vesting on a change of control, the performance will be calculated as at the date of the accelerated vesting and compared to the targets to determine the awards to be paid. • Upon completion of the vesting period associated with granted PSUs, a performance multiplier is calculated based on performance over the period relative to performance goals, and then applied to the PSUs originally granted such that the total monetary payout per PSU that vests may be greater or less than the value of a CWB common share. For grants up to and including fiscal 2020, the maximum possible performance multiplier is 200% and the minimum is 0%. For grants made at the beginning of fiscal 2021 forward, the maximum possible performance multiplier is 150% and the minimum is 50% (subject to HR Committee discretion over final award multipliers). • The value of each common share underlying the value of a PSU on the vesting date is based on the average of the weighted average trading price of the common shares on the TSX on the vesting date of the PSU and the 30 calendar days preceding the vesting date of the PSU. The value of each vested PSU is paid to Participants, in cash, no later than 60 days after vesting.
Grant Determination
Vesting
Payout
Details of PSU Grants Outstanding in Fiscal 2023
2020 PSU Grant
PSUs granted in fiscal 2020 vested on October 31, 2022. For details on those results, please see page 48 of the CWB 2023 Management Proxy Circular.
2021 PSU Grant
Performance Multiplier
PSUs granted in fiscal 2021 vested on October 31, 2023. For these PSUs, the performance multiplier included the following components: 60% based upon overall three-year relative TSR; and 40% based on the achievement of specified strategic initiatives.
45 | Canadian Western Bank- Management Proxy Circular
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