EXHIBIT 10.5

 

3M 1997 GENERAL EMPLOYEES STOCK PURCHASE PLAN

(as amended through November 8, 2004)

 

SECTION 1  DEFINITIONS

 

For the purpose of this Plan:

 

1.01.        Plan.  The term “Plan” shall mean the 1997 General Employees Stock
Purchase Plan, the terms and provisions of which are set forth herein.

 

1.02.        Company. The term “Company” shall mean 3M Company and such
subsidiaries as may be designated by the Board of Directors from time to time.

 

1.03.        Stock.  The term “Stock” shall mean the common stock, without par
value, of Minnesota Mining and Manufacturing Company.

 

1.04.        Participant.  The term “Participant” shall mean an employee who has
authorized payroll deductions in the manner set forth in the Plan.  Each
Participant shall have the same rights and privileges as every other
Participant.

 

1.05.        Current Compensation.  The term “Current Compensation” shall mean
the actual gross earnings of each Participant for each pay period applicable to
such Participant before any deductions have been made.

 

1.06         Regular Employee.   The term “Regular Employee” shall mean an
individual recognized as such in the employment records and information systems
of the Company.  Such term shall not include individuals recognized in the
employment records and information systems of the Company as temporary
employees, nor shall it include independent contractors or leased employees of
the Company.

 

1.07         Voice Response System.   The term “Voice Response System” shall
mean a telephone answering service or Internet-based website by which eligible
employees and Participants may elect to participate in the Plan, give
instructions and make elections by electronic communication to the Company or by
speaking with a representative of the Company.

 

1.08         1992 Plan.   The term “1992 Plan” shall mean the 1992 General
Employees Stock Purchase Plan.

 

1.09         Effective Date.      The term “Effective Date” shall mean the date
upon which this Plan becomes effective, determined in accordance with Section
12.01.

 

SECTION 2  ELIGIBLE EMPLOYEES

 

Any Regular Employee of the Company shall be eligible to participate in the Plan
in the month following the month in which he or she completes two months of
service.

 

SECTION 3  ELECTION TO PARTICIPATE

 

3.01.        An eligible employee may participate in the Plan only by voluntary
payroll deductions from Current Compensation.

 

3.02.        Unless and until the Company implements a Voice Response System, an
eligible employee may elect to participate in this Plan by completing and
returning to Employee Administrative Services of the Company a form known as
“Stock Authorization” which authorizes regular payroll deductions from the
employee’s Current Compensation beginning no later than the first pay period
commencing in the month following receipt of the form by Employee Administrative
Services and continuing until the employee withdraws from the Plan or his or her
option is terminated for any reason.  If and when the Company implements a Voice
Response System, both initial elections to participate in the Plan and changes
in elections will be made by using such Voice Response System in accordance with
uniform procedures established by the Company.

 

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3.03.        With the following exceptions, all elections made by participants
under the 1992 Plan and outstanding as of 11:59 PM CT on June 30, 1997 shall be
transferred to and remain in effect under this Plan (until changed by the
respective Participant) from and after 12:01 AM CT on July 1, 1997.  Elections
to participate by making elections under the 3M Flexible Benefits Program which
result in unutilized flex dollars being credited to participants’ stock option
accounts will not be recognized by the Plan.  Elections to purchase Stock in
five, fifteen or fifty share units will be recognized simply as elections to
participate under this Plan without regard to such block size.

 

SECTION 4  GRANTING OF OPTION

 

4.01.        An option for as many shares of Stock as may be purchased with each
Participant’s Stock Option Account balance as of the last business day of each
calendar month shall be granted to such Participant on the first trading day on
the New York Stock Exchange of such month.

 

4.02.        No Participant may be granted options which would permit his or her
right to purchase Stock under the Plan (and, for 1997, under the 1992 Plan) to
accrue at a rate which would exceed $25,000 of fair market value (determined at
the time the option is granted) for each calendar year in which such options are
outstanding at any time.

 

SECTION 5  OPTION PRICE

 

The option price for each share of Stock shall be eighty-five percent (85%) of
the fair market value of such shares on the New York Stock Exchange on the date
the option is granted, rounded up to the next higher even cent. The fair market
value shall be the mean between the high and low sales price for such shares on
the New York Stock Exchange.

 

SECTION 6  PAYROLL DEDUCTIONS

 

6.01.        A Participant may elect payroll deductions in whole percentages
from three to ten percent of Current Compensation, subject to the individual
limit set forth in Section 4.02 herein.  With the exception of account balances
carried over from the 1992 Plan, no deductions shall commence prior to the
granting of the option.

 

6.02.        A Participant may at any time increase or reduce the amount of his
or her payroll deduction within the limitations of Section 6.01 by completing a
“Payroll Data Record.” The change shall become effective not later than the next
pay period commencing after receipt of the form by Employee Administrative
Services of the Company.

 

6.03.        Payroll deductions will be credited to each Participant’s Stock
Option Account on the last business day of each month for deductions withheld
from payrolls and received at the Company’s payroll bank account on or prior to
that date.

 

SECTION 7  STOCK OPTION ACCOUNT

 

All funds withheld from a Participant’s Current Compensation in accordance with
his or her authorization shall be credited to the Participant’s Stock Option
Account.  Unless required by law, a Participant may not make any separate cash
payment into his or her Stock Option Account.  Unused funds remaining in a
participant’s stock option account under the 1992 Plan following the termination
of such plan will be transferred and credited to the Participant’s Stock Option
Account under this Plan as of the Effective Date.

 

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SECTION 8  EXERCISE OF OPTIONS

 

8.01.        On the last business day of each month during which a Participant
has a Stock Option Account balance, the Participant’s option shall automatically
be exercised at the option price for that month, unless the Participant
withdraws from the Plan prior to such day.

 

8.02.        If on the exercise date the fair market value of a share of Stock
on the New York Stock Exchange is lower than the Participant’s option price, the
option will be exercised at the fair market value of such shares on the New York
Stock Exchange on the exercise date.

 

8.03         As soon as practicable after the exercise of a Participant’s
option, the shares purchased upon the exercise of such option will be credited
to the Participant’s book entry account established by the Company with its
stock transfer agent.

 

SECTION 9  TERMINATION OF PARTICIPATION

 

9.01.        A Participant who is participating through voluntary payroll
deductions may at any time, by written notice on a Payroll Data Record, cease
making any further payroll deductions.  In such event, the Company shall refund
within 45 days, the entire balance in the Participant’s Stock Option Account (if
any).  A Participant may, however, make only one election to withdraw from or to
re-enter the Plan in any one calendar month.

 

9.02.        Participation under the Plan shall automatically cease upon the
date of a Participant’s death or termination of employment for reasons other
than retirement, and the amount credited to the Participant’s Stock Option
Account (if any) shall be refunded within 45 days to him or her or to his or her
estate.

 

9.03.        When a Participant retires, the Participant’s option for the month
immediately preceding his or her retirement will be automatically exercised on
the last business day of such month to the extent of the funds in his or her
Stock Option Account.  Following such exercise, the Participant’s participation
in this Plan will end.

 

9.04.        Approved leave of absence or layoff shall not be deemed a
termination of employment for purposes of Section 9.

 

SECTION 10  TRANSFERABILITY

 

10.01.      The options may not be assigned, transferred, pledged, or
hypothecated (whether by operation of law or otherwise), and shall not be
subject to execution, attachment, or similar process.  Any attempted assignment,
transfer, pledge, hypothecation, other disposition of the option, or levy of
attachment or similar process upon the option shall be null and void and without
effect.  The option may be exercised only by the Participant.

 

10.02.      The funds accumulated in the Stock Option Account may not be
assigned, transferred, pledged, or hypothecated in any way, and any attempted
assignment, transfer, pledge, hypothecation or other disposition of the funds
accumulated in the Stock Option Account shall be null and void and without
effect.

 

SECTION 11  ISSUANCE AND SALE OF SHARES

 

11.01.      Effective for shares purchased on or after January 1, 2005, a
Participant may not sell or otherwise transfer the shares of Stock purchased
upon the exercise of an option granted under this Plan during the one-year
period following the date on which the option was exercised; provided, however,
that this prohibition will not apply and such shares may be transferred or sold
following the death of the Participant; and provided further, that such shares
may be sold (subject to the provisions of Section 11.02) following the
retirement or termination of employment of the Participant.

 

11.02.      Effective for shares purchased on or after January 1, 2005, a
Participant subject to U.S. income taxes may not sell or otherwise transfer the
shares of Stock purchased upon the exercise of an option granted under this
Plan, except for sales through the designated broker selected by the Company,
during the one-year period following the first anniversary of the date on which
the option was exercised; provided, however, that this prohibition will not
apply and such shares may be transferred or sold following the death of the
Participant.

 

11.03.      Any attempt by a Participant to sell or transfer shares of Stock at
a time or in a manner that is inconsistent with the provisions of Sections 11.01
or 11.02 will be considered null and void and of no effect.

 

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11.04.      After the restrictions on sale or transfer of shares of Stock
described in Sections 11.01 and 11.02 have expired or become inapplicable, a
Participant may receive certificates for the shares of Stock purchased upon the
exercise of options granted under this Plan only by furnishing an appropriate
written or electronic request to the Company or its agent in accordance with its
instructions.

 

11.05.      The Company shall not be required to issue or deliver any
certificate for Stock purchased upon the exercise of options granted hereunder
(i) prior to the admission of such Stock to listing on any stock exchange on
which Stock may at that time be listed or required to be listed, or (ii) prior
to registration under the Securities Act of 1933, or registrations under any
state or foreign laws, if such registration is required.  The Company will use
its best efforts to accomplish such listing or registration not later than a
reasonable time following each exercise of such options, and delivery of Stock
by the Company may be deferred until listing or registration is accomplished.

 

11.06.      A Participant shall have no interest in the Stock covered by the
options until the shares purchased in accordance with Section 8 are credited to
the Participant’s book entry account.

 

SECTION 12  EFFECTIVE DATE AND AMENDMENT

OR TERMINATION OF PLAN

 

12.01.      The Plan shall become effective on the date fixed by the Board of
Directors after approval by the stockholders.

 

12.02.      The Plan shall automatically terminate five years from the Effective
Date unless extended by the Board of Directors.  The Board of Directors may by
resolution extend the Plan for one or more additional periods of one year each.

 

12.03.      The Board of Directors may at any time terminate or amend the Plan
except that no amendment shall be made without prior approval of the
stockholders which would (i) authorize the issuance of more than 30,000,000
unissued shares of Stock (after adjustment for stock splits), (ii) permit the
issuance of Stock before payment thereof in full, (iii) increase the rate of
payroll deductions above ten percent of Current Compensation, (iv) reduce the
price per share at which the Stock may be sold, or (v) authorize the sale of
more than an aggregate of 30,000,000 shares of Stock (after adjustment for stock
splits).

 

12.04.      Upon termination of the Plan, the Participant’s option shall be
exercised for the number of whole and fractional shares which can be purchased
with the funds credited to the Participant’s Stock Option Account on the date of
termination.  Any balance remaining after said exercise shall be refunded to the
Participant.

 

SECTION 13  ADMINISTRATION

 

The Plan shall be administered under the direction of the Compensation Committee
of the Board of Directors.  In administering the Plan, it will be necessary to
follow various laws and regulations.  It may be necessary from time to time to
change or waive requirements of the Plan to conform with the law, to meet
special circumstances not anticipated or covered in the Plan, or to carry on
successful operations of the Plan.  Therefore, it is necessary for the Company
to reserve the right to make variations in the provisions of the Plan and to
determine any questions which may arise regarding interpretation and application
of the Plan’s provisions.  The Committee’s determinations as to the
interpretation and operation of this Plan shall be final and conclusive.

 

SECTION 14  STOCK DIVIDEND, STOCK SPLIT, REDUCTION IN

SHARES, MERGER, OR CONSOLIDATION

 

If a record date for a stock dividend, split, or reduction in the number of
shares of Stock should occur during the option period, appropriate adjustments
in numbers of shares and option prices shall be made to give effect thereto on
an equitable basis.

 

If the Company is merged into or consolidated with one or more corporations
during the option period, appropriate adjustments shall be made to give effect
thereto on an equitable basis in terms of issuance of shares of the corporation
surviving the merger or the consolidated corporation, as the case may be.

 

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SECTION 15  STOCK TO BE SOLD

 

The aggregate number of shares of Stock which may be optioned and sold under the
Plan shall not exceed 30,000,000 shares, all or any portion of which may be
treasury shares, shares reacquired from time to time, or authorized but unissued
shares.  In the event of a reclassification or stock split of the Stock, the
foregoing number of shares shall be appropriately adjusted.

 

SECTION 16  FUNDS IN STOCK OPTION ACCOUNT

 

The funds deducted and retained from the Participants shall be accounted for in
U.S. dollars and shall be remitted to 3M Company as directed by the Company. 
The funds in the Stock Option Account, after receipt by 3M Company, shall be
under the direction of 3M Company and applied to the payment for Stock at the
time the Participant’s options are exercised.

 

No interest will be accumulated or paid by the Company on funds held in the
Stock Option Account.

 

SECTION 17  NOTICES

 

Notices to the Committee shall be addressed as follows:

 

Compensation Committee

c/o 3M Secretary

P. O. Box 33428

St. Paul, MN 55144-1000

 

SECTION 18  OTHER COMPANY BENEFIT AND

COMPENSATION PROGRAMS

 

Unless otherwise specifically determined by the Committee, the receipt by
Participants of options under the Plan shall not be deemed a part of a
Participant’s regular, recurring compensation for purposes of calculating
payments or benefits from any Company benefit plan, severance program, or
severance pay law of any country.  Further, the Company may adopt other
compensation programs, plans, or arrangements as it deems appropriate or
necessary.

 

SECTION 19  FUTURE RIGHTS

 

No participant shall have any rights under the Plan to be retained in the employ
of the Company.

 

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