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Employment Agreement - Charles Schwab Corp. and Jeffrey S. Maurer

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November 4, 2002

Mr. Jeffrey S. Maurer
241 Kings Point Road
Kings Point, New York 11024

Dear Jeff:

The purpose of this letter is to confirm our understanding of, and agreement to,
the following terms regarding your recent change in position.  We recognize that
you have been terminated as Chairman and Chief  Executive  Officer of U.S. Trust
and have the right to leave at any time hereafter  prior to May 31, 2003 with or
without  Good  Reason and have it treated as a  termination  of your  employment
without  Cause by us.  Any  termination  by you or us  (whether  with or without
Cause)  hereafter and on or prior to May 31, 2003,  including  termination  as a
result  of  your  death  or  Disability,   shall  be  treated  as  a  "Protected
Termination"  entitling you to the compensation,  benefits,  and perquisites set
forth in your  Employment  Agreement  and as  expanded  herein.  (Any  terms not
defined in this letter shall have the meanings given to them in your  Employment

As announced,  you will chair the Affluent Client Strategy and Policy  Committee
and continue to serve on Schwab's Executive Committee.

Your annual salary will  continue to be paid at the rate of $565,000,  until the
end of  calendar  year 2002.  Beginning  January  1,  2003,  you will be paid in
accordance  with the  Schwab  Executive  Committee  members  who lead a  similar
function to the Affluent Client Strategy and Policy Committee  (e.g.,  Corporate
Strategy).  However, all of your  non-pay-related  benefits and perquisites will
continue at the same amounts and levels  currently in effect.  Your  pay-related
benefits will reflect your 2003 base salary.  David Pottruck,  in good faith, in
accordance  with the above  principles  and after  consultation  with you,  will
establish your base salary,  bonus and long-term  incentive  targets for 2003 by
December 1, 2002.

In addition,  assuming  your  employment  terminates  as a result of a Protected
Termination, you will receive two (2) times your annual base salary of $565,000,
totaling  $1,130,000,  which shall be payable within two weeks of your Protected
Termination date in a lump sum cash payment (less customary withholding).

You will receive a cash payment equal to your 2001 bonus (170% of your 2001 base
salary) payable on the first business day of January 2003. You will also receive
any bonus due for  Schwab's  fiscal  year 2002 in  accordance  with the  pay-out
received by other Executive Committee members; provided that this bonus shall be
calculated and paid as if you had worked for all of fiscal year 2002 even if you
have a Protected  Termination prior to the end of the 2002 fiscal year. You will
also receive a full or pro-rated 2003 bonus upon  termination of your employment
during or after 2003.  The EIP waiver under the Split Dollar  Agreement will not

Assuming you have a Protected  Termination,  you will receive a payment equal to
two (2) times your current targeted bonus. Although this target is now 125%, for
purposes of this termination payment only, the target will be 170%, or an amount
of $960,500  per year.  The total  payment  will be two (2) times that amount or
$1,921,000,  less  applicable  taxes and  withholding.  You will  receive  these
amounts  within two (2) weeks of your Protected  Termination  date in a lump sum
cash payment (less applicable withholding).

Stock Grants
Upon a Protected Termination, you will receive full and immediate vesting of any
outstanding  stock  options and other equity  based awards  effective as of such
termination  date. The exercise period for all vested and exercisable  Incentive
Stock  Options  ("ISOs")  will be no later  than  three  (3)  months  after  the
termination date (or expiration  date,  whichever is earlier) and for all vested
and exercisable  Non-Qualified Stock Options ("NQSOs") will be no later than two
(2) years after the termination date (or expiration date, whichever is earlier).

Non  Compete/Non-Solicitation
In the event of a Protected  Termination,  the non-compete and  non-solicitation
clauses described in Section 8 of your Employment Agreement will begin to run on
the earlier of your Protected Termination date or October 4, 2002 and will cease
one (1) year  thereafter,  provided  that  Sections  8(b)(i)  and  (iii) of your
Employment Agreement will continue to apply until one (1) year after the earlier
of January 1, 2003 or your  Protected  Termination  date. We also agree that the
non-compete in your  Employment  Agreement will not apply to financial  services
departments of corporate conglomerates.

The remaining  provisions in the Employment  Agreement will remain in full force
and  effect,  including,  but not limited to, the  provisions  addressing  Media
Communication  and  Non-Disparagement.  Furthermore,  no member of the Schwab or
U.S. Trust Control Group (as defined  below) will make any public  statements to
any third parties intended to disparage or damage your reputation,  nor will any
member of the Control Group or anyone acting on the Control Group's behalf as an
entity, issue any press releases or media  communications  intended to disparage
or damage  your  reputation,  provided  that the  foregoing  is not  intended to
prevent  truthful  testimony by any members of the Control  Group in  connection
with  any  statutory  or  contractual  reporting  obligations,  in any  judicial
proceeding,  or as a defense to any claim,  action or allegation  raised by you.
For purposes of this agreement, Control Group shall mean Charles Schwab, Alan J.
Weber,  David Pottruck,  and Mary S. McLeod. In addition,  we further agree that
the  non-disparagement  provisions  in section 11 of your  Employment  Agreement
shall not affect your ability to respond  truthfully and  professionally  to any
disparaging  statements made by any executive  employee of Schwab or U.S. Trust.
Nothing  in  this  paragraph  is  intended  to  prevent  you  from  engaging  in
"competitive  puffery" regarding the Company's products or services providing no
disparaging  comments are made regarding Schwab or U.S. Trust in connection with
the same.

Other Terms, Benefits & Perquisites
In addition, listed below are the benefits you would be eligible to receive upon
a  Protected  Termination.  Please  note,  we have  assumed a December  31, 2002
termination  date for purposes of these  calculations;  however,  we assume this
will  not  be the  actual  date  and  therefore,  the  calculations  may  change
consistent with the actual date.

Retirement  Plan Benefit - You can retire on January 1, 2003 and begin receiving
a monthly pension  benefit of $6,237.47  assuming a 50% Joint & Survivor form of
pension. If you defer receipt of your pension benefits until August 1, 2007 (age
60), this amount will increase to $8,060.55. Under the 50% Joint & Survivor form
of pension you would receive the stated monthly amount for your lifetime and, at
your death,  your  surviving  spouse would begin to receive half of this monthly
benefit for her  lifetime.  Forms of payment other than the 50% Joint & Survivor
are available with spousal consent. In addition,  we agree that, in the event of
your Protected Termination, you will be entitled to receive from the Company, on
your termination date, a single sum payment in an amount equal to the excess of:
(x) the present value of your accrued benefit, expressed in the form of a single
life annuity,  under the U.S. Trust Corporation Employees' Retirement Plan ("UST
Pension  Plan"),  with such accrued benefit to be calculated at the time of your
Protected  Termination  by adding two (2)  additional  years of age and Credited
Service and (y) the present value of your accrued benefit, expressed in the form
of a single life annuity,  under the UST Pension Plan  calculated at the time of
your Protected Termination.

401K/ESPOP  -  Beginning  in  January  2003,  you can  elect to  receive  a full
distribution of your account balance during any month; however, you must request
a distribution by the end of the year in which you attain age 65.

Non-Qualified  Plans - Your account balances in the EDCP and BEP will fully vest
and be paid in 10 annual  installments.  The first  installment will be in March
2003. The September 30, 2002 balances for the BEP and EDCP are  $539,871.00  and
$701,425.00,  respectively.  The EDCP  amount  includes  the 2000 EIP  Mandatory
Deferred  portion  which  was  scheduled  to vest in  2006,  but  will  now vest
immediately.  Within  the  next few  days  these  balances  will be  updated  on  to reflect  the  September  30,  2002  values.  Upon a Protected
Termination, your account balance under the BEP will be credited with amounts as
if you had  remained  employed  by U.S.  Trust  for two  (2)  years  beyond  the
Protected  Termination  date. In addition,  the value of two additional years of
Credited  Service under the U.S. Trust  Corporation  Employees'  Retirement Plan
will be credited to your account under the EDCP.

Retirement  Medical Plan - You are eligible to participate  under the Retirement
Medical Plan when your active  employee  coverage  ends.  You are also entitled,
upon a Protected Termination,  to two (2) additional years of coverage under the
medical plan(s) in which you currently participate and, following the expiration
of this period,  you may elect to commence coverage under the Retirement Medical
Plan, to the extent this is more beneficial to you.

Retirement Life Insurance - After your active coverage ends you are eligible for
retirement  life insurance equal to an initial amount of your active life amount
or $100,000, whichever is less. This initial amount is reduced by 10% during the
first 5 years of your coverage. You are currently enrolled for $10,000 of active
life  insurance;  therefore,  you may want to  consider  increasing  this amount
during the next open enrollment period to maximize this benefit. Any increase in
life  insurance  coverage is subject to evidence  of good health  acceptable  to
Metropolitan Life. Upon a Protected Termination, you will continue to be covered
under all insurance  arrangements as if you had remained  actively  employed for
two (2) additional  years,  except under the Split Dollar  Insurance  Agreement,
currently in effect. With respect to said Split Dollar Insurance Agreement,  the
following  terms will apply:  (1) U.S. Trust will not be under any obligation to
make the additional  premium payments  otherwise  required under said Agreement;
(2) U.S.  Trust will  assign all of its rights  and  benefits  in the  insurance
policy subject to such Agreement to you; and (3) U.S. Trust will waive its right
to receive the "Corporation's Recovery Amount" as defined in said Agreement.

Dental - You can elect  COBRA  continuation  for 18  months  after  your  active
employee  coverage  ends.  In the  event of a  Protected  Termination,  you will
receive two (2) additional years of active employee  coverage and then may elect
COBRA coverage.

Vacation - You will be paid for any unused  vacation  days  through  the date of
your Protected Termination; such payment will be made in a lump sum cash payment
(less applicable withholding) promptly after your Protected Termination date.

280G  Gross-Up - Your rights under  Section  12(j) of the  Employment  Agreement
shall in all events,  whether your  termination  is a Protected  Termination  or
otherwise, continue in full force and effect.

Legal Fees - We will pay the reasonable legal fees incurred by you in connection
with the negotiation and finalization of this letter and the new arrangement.

Jeff,  we very much look  forward to working  with you in your new  position  at
Schwab.  Please  review  the  terms  set  forth  above.  If any of the terms are
contrary to your  understanding of our agreement,  please let me know as soon as
possible.  If the terms are consistent with your understanding of our agreement,
please sign below.  This letter will serve as a  modification  to the Employment
Agreement entered into as of January 12, 2000.


/s/ David Pottruck                                /s/ Mary S. McLeod
-------------------------------                   ------------------------------
David Pottruck                                    Mary S. McLeod
President and Co-CEO                              Executive Vice President
The Charles Schwab Corporation;                   Human Resources
Member, Board of Directors
U. S. Trust

/s/ Jeffrey S. Maurer                                   11/7/02
------------------------------                    ------------------------------
Jeffrey S. Maurer                                 Date