exv10w4



 





EXHIBIT 10.4




U.S. BANCORP

NON-QUALIFIED STOCK OPTION AGREEMENT FOR DIRECTORS




	 	 	 	 	 	 	 	 	 
	 	 	 	 	Number of U.S. Bancorp	 	Exercise Price	 	Social Security
	GRANTED TO
	 	Grant Date
	 	Common Shares
	 	Per Share ($)
	 	Number

	

	 	
Expiration Date
	 	
 	 	
 	 	
 







To accept receipt of the Option and to agree to the terms and conditions of the
Plan and this Agreement, take no action. To reject receipt of the Option and
the terms and conditions of the Plan and this Agreement, please notify the
Corporate Secretary at U.S. Bancorp, 800 Nicollet Mall, BC-MN-H21O,
Minneapolis, MN 55402, in writing within 30 calendar days of the day you
receive this document. Failure to notify in a timely manner will result in
your acceptance of the Option and the terms and conditions of the Plan and this
Agreement.





THIS AGREEMENT is made as of the date in the box above labeled “Grant
Date” (the “Grant Date”) by and between U.S. Bancorp, a Delaware
corporation (the “Company”), and the director named in the box above
labeled “Granted To” (the “Optionee”).




WHEREAS, the Company pursuant to its 2001 Stock Incentive Plan (the
“Plan”) wishes to grant a stock option for the purchase of Common
Stock of the Company, $.01 par value (the “Common Stock”), to the
Optionee on the terms and conditions contained in this Agreement and
the Plan. In consideration of the mutual covenants contained in this
Agreement, the parties agree as follows:




	1.	 	Grant of Option.






The Company grants Optionee the right and option (the “Option”)
to purchase all or any part of an aggregate of the number of shares of the Company’s Common Stock set forth in the box above
labeled “Number of U.S. Bancorp Common Shares” at the exercise
price set forth in the box above labeled “Exercise Price Per
Share” on the terms and conditions of this Agreement. The
Option is not intended to be an incentive stock option within
the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the “Code”).



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	2.	 	Vesting of Exercise Rights.
	 



	(a)	 	Subject to the terms and conditions of this Agreement, the
Option may be exercised by Optionee in cumulative installments
not in excess of 25% on or after the first anniversary of the
Grant Date, 25% on or after the second anniversary of the Grant
Date, 25% on or after the third anniversary of the Grant Date and
25% on or after the fourth anniversary of the Grant Date. If the
full amount of stock available for purchase in any of the
foregoing periods is not purchased during such period, the shares
not purchased shall be available for purchase in any subsequent
period during the term of the Option. The Option shall terminate
at the close of business on the date in the box above labeled
“Expiration Date,” or on such earlier date as described in this
Agreement.
	 
	(b)	 	Notwithstanding the other vesting provisions contained in Section
2(a) above, but subject to the other terms and conditions of this
Agreement, the Option may be exercised in full immediately upon a
“Change in Control.” For purposes of this Agreement, the following
terms shall have the following definitions:






	(i)	 	“Announcement Date” shall mean the date of the public
announcement of the transaction, event or course of action that
results in a Change in Control.
	 
	(ii)	 	“Cause” shall mean (A) the continued failure by Optionee
to substantially perform Optionee’s duties with the Company, after
a demand for substantial performance is delivered to Optionee that
specifically identifies the manner in which the Company believes
that Optionee has not substantially performed Optionee’s duties,
and Optionee has failed to resume substantial performance of
Optionee’s duties on a continuous basis, (B) gross and willful
misconduct during service as a director (regardless of whether the
misconduct occurs on the Company’s premises), including, but not
limited to, theft, assault, battery, malicious destruction of
property, arson, sabotage, embezzlement, harassment, acts or
omissions which violate the Company’s rules or policies (such as
breaches of confidentiality), or other conduct which demonstrates
a willful or reckless disregard of the interests of the Company or
its Affiliates or (C) Optionee’s conviction of a crime (including,
without limitation, a misdemeanor offense) which impairs
Optionee’s ability substantially to perform Optionee’s duties as a
Director.
	 
	(iii)	 	“Change in Control” shall mean any of the following
occurring after the date of this Agreement:






	(A)	 	The acquisition by any Person (as defined in
Section 2(b)(iv) hereof) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of
35% or more of either (1) the then outstanding shares of
Common Stock (the “Outstanding Company Common Stock”) or (2)
the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting
Securities”); provided, however, that, for purposes of this
clause (A), the following acquisitions shall not constitute a
Change in Control: (i) any acquisition directly from the
Company, (ii) any acquisition by the Company, (iii) any
acquisition by a subsidiary of the Company or any employee
benefit plan (or related trust) sponsored or maintained by the
Company or a subsidiary of the Company (a




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	 	 	“Company Entity”) or (iv) any acquisition by any corporation
pursuant to a transaction which complies with clause (i), (ii)
or (iii) of this clause (A); or






	(B)	 	Individuals who, as of the date, constitute the
Company’s Board of Directors (the “Incumbent Board”) cease for
any reason to constitute at least a majority of the Board of
Directors (except as a result of the death, retirement or
disability of one or more members of the Incumbent Board);
provided, however, that any individual becoming a director
subsequent to the date of this Agreement whose election, or
nomination for election by the Company’s shareholders, was
approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board,
but excluding, for this purpose, (1) any such individual whose
initial assumption of office occurs as a result of an actual
or threatened election contest with respect to the election or
removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a
Person other than the Incumbent Board, (2) any director
designated by or on behalf of a Person who has entered into an
agreement with the Company (or which is contemplating entering
into an agreement) to effect a Business Combination (as
defined in Section 2(b)(iii)(C) hereof) with one or more
entities that are not Company Entities or (3) any director who
serves in connection with the act of the Board of Directors of
increasing the number of directors and filling vacancies in
connection with, or in contemplation of, any such Business
Combination; or
	 
	(C)	 	Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a “Business
Combination”), in each case, unless, following such Business
Combination, (1) all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of
the Outstanding Company Common Stock and Outstanding Company
Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more
than 50% of, respectively, the then outstanding shares of
common stock or the combined voting power of the then
outstanding voting securities entitled to vote generally in
the election of directors, as the case may be, of the
corporation resulting from such Business Combination
(including, without limitation, a corporation which as a
result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or
through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such
Business Combination, of the Outstanding Company Common Stock
and Outstanding Company Voting Securities, as the case may be,
(2) no Person (excluding any Company Entity or such
corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 35% or more of,
respectively, the then outstanding shares of common stock of
the corporation resulting from such Business Combination or
the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such
ownership existed prior to the Business Combination and (3) at
least a majority of the members of the board of directors of
the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board of
Directors, providing for such Business Combination; or




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	(D)	 	Approval by the shareholders of the Company of a
complete liquidation or dissolution of the Company.






	(iv)	 	“Person” shall be defined as defined in Sections 13(d)(3)
and 14(d)(2) of the Exchange Act.






	3.	 	Effect of Termination of Directorship






	(a)	 	The Option shall terminate and may no longer be exercised if
Optionee ceases to be a director of the Company, except that:






	(i)	 	If Optionee’s service as a director is terminated for any
reason other than for Cause or for voluntary separation from
service with less than ten years of service as a director, the
Option will immediately be fully exercisable in whole
notwithstanding the vesting provisions contained in Section 2(a)
or Section 2(b), and may be exercised at any time during the
remaining term of the option, but not after the termination date
of the Option.
	 
	(ii)	 	If Optionee’s service as a director is terminated upon
the Optionee’s reaching mandatory retirement age, the Option will
immediately be fully exercisable in whole notwithstanding the
vesting provisions contained in Section 2(a) or Section 2(b), and
may be exercised at any time during the remaining term of the
option, but not after the termination date of the Option.
	 
	(iii)	 	If Optionee’s service as a director is terminated by
reason of Cause, the Option shall be terminated as of the date of
the misconduct.
	 
	(iv)	 	If Optionee’s service as a director is terminated by
voluntary separation from the Board with fewer than ten years
service as a Director, then Optionee may at any time within a
period of three years after such termination, but not after the
termination date of the Option, exercise the option to the extent
that the Option was exercisable by Optionee on the date of the
termination of service as a director.






	4.	 	Securities Law Compliance






The exercise of all or any portion of this Option shall only be effective
at such time that the sale of Common Stock issued pursuant to such exercise
will not violate any state or federal securities or other laws. The
Company is under no obligation to effect any registration of the stock
subject to the Option under the Securities Act of 1933 or to effect any
state registration or qualification of such Common Stock. The Company may,
in its sole discretion, defer the effectiveness of any full or partial
exercise of the Option in order to ensure that the issuance of stock upon
exercise will be in compliance with federal or state securities laws and
the rules of the New York Stock Exchange or any other exchange upon which
the Company’s Common Stock is traded.




	5.	 	Method of Exercise of Option






Subject to the foregoing, the Option may be exercised in whole or part from
time to time by serving written notice of exercise on the Company at its
principal executive offices, to the attention of the Company’s Executive
Compensation Department or to its properly designated agent serving from
time to time. The notice shall state the number of shares as to which the
Option is being



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exercised and be accompanied by payment of the purchase price. Optionee
may, at Optionee’s election, pay the purchase price (a) by check payable to
the Company, (b) in previously owned shares of the Company’s Common Stock
or (c) in any combination of the two, in each case having a Fair Market
Value (as defined in the Plan) on the exercise date equal to the applicable
exercise price. Optionee may, at Optionee’s election, exercise the Option,
in whole or in part, by providing the Company with an attestation that such
previously owned shares of the Company’s Common Stock are owned by
Optionee, in which case the number of previously owned shares having a Fair
Market Value equal to the exercise price (or appropriate portion of the
exercise price) will be withheld from the number of shares issued to
Optionee pursuant to the exercise of the Option. Previously owned shares
used as provided in the two immediately preceding sentences must have been
owned by Optionee for a minimum of six months prior to the date of exercise
of the Option for this method of payment to apply.




	6.	 	Miscellaneous






	(a)	 	Except pursuant to terms approved by the Compensation Committee
of the Board of Directors (the “Committee”), the Option may not be
transferred, except by will or the laws of descent and distribution to
the extent provided in Section 3(a)(iii) or Section 3(a)(iv) , and
during Optionee’s lifetime the Option is exercisable only by Optionee
(or by Optionee’s guardian or legal representative in the case of
Disability).
	 
	(b)	 	In the event that any dividend or other distribution (whether in
the form of cash, shares of Common Stock, or other securities or other
property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Common Stock or other
securities of the Company or other similar corporate transaction or
event affecting the stock subject to the Option would be reasonably
likely to result in the diminution or enlargement of any of the
benefits or potential benefits intended to be made available under the
Option (including, without limitation, the benefits or potential
benefits of provisions relating to the term, vesting or exercisability
of the Option, and any “change in control” provision), the Committee
shall, in such manner as it shall deem equitable or appropriate in
order to prevent such diminution or enlargement of any such benefits
or potential benefits, adjust any or all of (i) the number and type of shares (or other securities or other property) subject to the Option
and (ii) the exercise price with respect to the Option; provided,
however, that the number of shares covered by the Option shall always
be a whole number. Without limiting the foregoing, if any capital
reorganization or reclassification of the capital stock of the
Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of the Company’s
assets to another corporation, shall be effected in such a way that
holders of the Company’s Common Stock shall be entitled to receive
stock, securities, cash or other assets with respect to or in exchange
for such shares, Optionee shall have the right to purchase and receive
upon the basis and upon the terms and conditions specified in this
Agreement and in lieu of the shares of the Common Stock of the Company
immediately available for purchase and receivable upon the exercise
of the Option, with appropriate adjustments to prevent diminution or
enlargement of benefits or potential benefits intended to be made
available under the Option, such shares of stock, other securities,
cash or other assets as would have been issued or delivered to
Optionee if Optionee had exercised the Option and had received such shares of
Common




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	 	 	Stock prior to such reorganization, reclassification,
consolidation, merger or sale. The Company shall not effect any such consolidation,
merger or sale unless prior to the consummation thereof the successor
corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing such assets shall
assume by written instrument the obligation to deliver to Optionee such
shares of stock, securities, cash or other assets as, in accordance
with the foregoing provisions, Optionee may be entitled to purchase or
receive.






	(c)	 	The Company shall at all times during the term of the Option
reserve and keep available such number of shares of the Company’s
Common Stock as will be sufficient to satisfy the requirements of this
Agreement.
	 
	(d)	 	This Option is issued under the Plan and is subject to its terms.
The Plan is available for inspection on the intranet and during
business hours at the principal offices of the Company.






	7.	 	Governing Law






This Agreement shall be governed by and construed in accordance with the
laws of the State of Minnesota.



IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the day and year first written above.




U.S. BANCORP




By:




Its: Vice President and Assistant Secretary




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