exv10w4





 Exhibit 10.4



EXPRESS SCRIPTS, INC.

2011 LONG-TERM INCENTIVE PLAN

STOCK OPTION GRANT NOTICE




FOR NON-EMPLOYEE DIRECTORS




     Notice is hereby given of the following option grant (the “Option”) to purchase shares of
common stock, $0.01 par value per share, of Express Scripts, Inc. (the “Company”) pursuant to the
following terms and conditions:



	 	 	 	 	 	 
	 	 	 	 	 	 
	•

	 	Optionee:
	 	 
	 
	 
	 	 	 	 	 
	•

	 	Grant Date:
	 	 
	 
	 
	 	 	 	 	 
	•

	 	Exercise Price Per Share:
	 	$  
	 
	 
	 	 	 	 	 
	•

	 	Number of Option Shares:
	 	 
	 
	 
	 	 	 	 	 
	•

	 	Term/Expiration Date of Option:
	 	 
	 
	 
	 	 	 	 	 
	•

	 	Type of Option:
	 	Non-qualified Stock Option
	 
	 	 	 	 	 
	•	 	Vesting Schedule: The shares of common stock granted pursuant to the Option
shall be vested and become exercisable in accordance with the following vesting
schedule:





	 	 	 	 	 	 
	 
	 	— 	   
	 
	 	— 	   
	 
	 	— 	   
	 
	 	 	 	 	 
	•	 	Other Provisions: The Option is granted subject to, and in accordance with,
the terms of the Stock Option Agreement (the “Option Agreement”) attached hereto as
Exhibit A, including Schedule 1 thereto, and the Express Scripts, Inc. 2011 Long-Term
Incentive Plan (the “Plan”) attached hereto as Exhibit B.







This Option is granted under, and governed by, the terms and conditions of this Grant
Notice, the Plan and the Option Agreement.



	 	 	 	 	 
	 	EXPRESS SCRIPTS, INC.

 	 
	 	By:  	 	 
	 	 	[NAME] 	 
	 	 	[TITLE] 	 
	 



Attachments:




Exhibit A—
Stock Option Agreement


Exhibit B—Express Scripts, Inc. 2011 Long-Term Incentive Plan




 









 





EXHIBIT A




EXPRESS SCRIPTS, INC.

2011 LONG-TERM INCENTIVE PLAN

STOCK OPTION AGREEMENT

FOR NON-EMPLOYEE DIRECTORS




     Express Scripts, Inc., a Delaware corporation (“Company”), has granted you (“Optionee”) an
option to purchase shares of common stock of the Company, $0.01 par value per share (“Common
Stock”), pursuant to the terms and conditions set forth in your Stock Option Grant Notice (“Grant
Notice”) and this Stock Option Agreement (“Option Agreement”).



     The Option is granted pursuant to the Express Scripts, Inc. 2011 Long-Term Incentive Plan, as
amended from time to time (the “Plan”), pursuant to which options, and other awards, may be granted
to Non-Employee Directors of the Company. Except as otherwise specifically set forth herein, all
capitalized terms utilized herein (including on Schedule 1 hereto) shall have the
respective meanings ascribed to them in the Plan



     The details of your Option are as follows:



     1. Grant of Option. Pursuant to an action of the Board and or a committee authorized
by the Board, the Company hereby grants to Optionee an option to purchase shares of Common Stock
(the “Option”), subject to the terms and conditions described herein. The number of shares of
Common Stock subject to your Option and the Exercise Price Per Share are set forth in the Grant
Notice.



     2. Term, Vesting and Forfeiture.


          (a) Term. This Option may be exercised only within the Term set forth in the Grant Notice,
and may be exercised during such Term only in accordance with the Plan and the terms of this Option
Agreement.


          (b) Time Vesting. The Option shall vest in one or more installments in accordance with the
Vesting Schedule set forth on the Grant Notice, with the vesting of each installment subject to the
Optionee’s continued service as a member of the Board through the applicable vesting date, subject
to the terms hereof.


          (c) Accelerated Vesting. Any Option, or portion thereof, which has not yet vested under
subparagraph (b) above shall, upon the occurrence of a Change in Control or the termination of the
Optionee’s continued service as a member of the Board, vest or be forfeited in accordance with the
provisions of the Plan, and the terms of this Agreement (including Schedule 1 hereto).


          (d) Forfeiture of Option. If Optionee’s service as a member of the Board terminates for any
reason, Optionee shall forfeit all rights with respect to any portion of the Option that has not
yet vested as of the effective date of the termination, except to the extent such Award vests upon
such termination under Paragraph 2(c).



     3. Exercise of Option.


          (a) Right to Exercise. This Option is exercisable during its Term in accordance with the
Vesting Schedule set forth in the Grant Notice and the applicable provisions of the Plan and this
Option Agreement.



 









 







          (b) Method of Exercise. This Option is exercisable pursuant to the procedures for exercise
provided from time to time by the Company and/or by a third-party vendor selected by the Company.
The Option exercise shall require payment of the aggregate exercise price as to all exercised
shares. The method of payment of the aggregate exercise price shall be in a form approved by the
Company in accordance with Section 7(a)(ii) of the Plan. This Option shall be deemed to be
exercised upon receipt and approval by the Company (or the appropriate third party) of all required
exercise notices, together with full payment of the exercise price and such additional documents as
the Company (or the third-party vendor) may then require. The Company may cause, or authorize its
third-party to vendor to cause, the vested portion of this Option to automatically be exercised on
the Expiration Date for such Option, to the extent it has not previously been exercised or
forfeited.



     4. Incorporation of the Plan by Reference; Conflicting Terms. The Option is granted
under, and expressly subject to, the terms and provisions of the Plan, which terms and provisions
are incorporated herein by reference. Optionee hereby acknowledges receipt of a copy of the Plan
and agrees to be bound by all the terms and provisions thereof. In the event of any conflict
between the terms of the Plan and the terms of this Agreement, the terms and provisions of the Plan
shall govern.



     5. Non-Transferability of Option. This Option may not be transferred in any manner
otherwise than by will or by the laws of descent or distribution and may be exercised during the
lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be
binding upon the executors, administrators, heirs, successors and assigns of Optionee.



     6. Stockholder Rights. Optionee shall not have any stockholder rights with respect to
the shares of Common Stock granted pursuant to this Option until Optionee shall have exercised the
Option in accordance with Section 3 hereof.



     7. Adjustments Upon Changes in Capitalization or Corporate Acquisitions. Should any
change be made to the Common Stock by reason of any Fundamental Change, divestiture, distribution
of assets to stockholders (other than ordinary cash dividends), reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split, stock combination or exchange,
rights offering, spin-off or other relevant change, appropriate adjustments shall be made to (a)
the total number and/or class of securities subject to this Option, and (b) the Exercise Price Per
Share set forth in the Grant Notice in order to reflect such change and thereby preclude a dilution
or enlargement of benefits hereunder.



     8. Compliance with Laws and Regulations. Notwithstanding anything herein to the
contrary, no shares of Common Stock shall be issued pursuant to the exercise of this Option unless
such issuance and exercise complies with all relevant provisions of law and the requirements of any
stock exchange or quotation service upon which the shares of Common Stock are then listed.



     9. Board Discretion. This Option has been granted pursuant to a determination made by
the Board and/or one or more committees of the Board (as delegated by the Board). Notwithstanding
anything to the contrary herein, and subject to the limitations of the Plan, the Board or its
delegated committee(s) shall have plenary authority to: (a) interpret any provision of this
Agreement or the Option; (b) make any determinations necessary or advisable for the administration
of this Agreement or the Option; (c) make adjustments as it deems appropriate to the aggregate
number and type of securities available under this Agreement to appropriately adjust for, and give
effect to, any Fundamental Change, divestiture, distribution of assets to stockholders (other than
ordinary cash dividends), reorganization, recapitalization, reclassification, stock dividend, stock
split, reverse stock split, stock combination or exchange, rights offering, spin-off or other
relevant change; and (d) otherwise modify or amend any provision hereof, or otherwise with respect
to the Option, in any manner that does not materially and



 









 





adversely affect any right granted to Optionee by the express terms hereof, unless required as a
matter of law, subject to the limitations stated in the Plan.




     10. Tax Withholding. To the extent applicable and required by law, at the time
Optionee exercises his or her Option, in whole or in part, the Company shall withhold from
Optionee’s compensation any required taxes, including social security and Medicare taxes, and
federal, state and local income tax, with respect to the income arising from the exercise of the
Option under this Agreement. The Company shall have the right to require the payment of any such
taxes before delivering any shares of Common Stock upon the exercise of the Option, or any portion
thereof. Optionee may elect to have any such withholding obligations satisfied by: (i) delivering
cash; (ii) delivering part or all of the withholding payment in previously owned shares of Common
Stock; and/or (iii) irrevocably directing the Company to reduce the number of shares that would
otherwise be issued to Optionee upon the exercise of the Option that number of whole shares of
Common Stock having a fair market value, determined by the Company, in its sole discretion, equal
to the amount of tax required to be withheld, but not to exceed the Company’s required minimum
statutory withholding.



     11. Electronic Delivery. The Company may choose to deliver certain statutory or
regulatory materials relating to the Plan in electronic form, including without limitation
securities law disclosure materials. Without limiting the foregoing, by accepting this Option,
Optionee hereby agrees that the Company may deliver the Plan prospectus and the Company’s annual
report to Optionee in an electronic format. If at any time Optionee would prefer to receive paper
copies of any document delivered in electronic form, the Company will provide such paper copies
upon written request to the Investor Relations department of the Company.



     12. No Right to Continued Service on the Board. Nothing in this Agreement shall be
deemed to create any limitation or restriction on or otherwise affect such rights as the Company,
the stockholders of the Company, or the Board otherwise would have to remove Optionee from the
Board, to exclude Optionee from any slate of nominees for election to the Board, or to otherwise
terminate Optionee’s service on the Board at any time for any reason.



     13. Entire Agreement. This Agreement, including Schedule 1 hereto, and the Plan
contain the entire understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements, understandings and negotiations between the parties.



     14. Governing Law. To the extent federal law does not otherwise control, this
Agreement shall be governed by the laws of Delaware, without giving effect to principles of
conflicts of laws.



 









 





SCHEDULE 1 TO EXHIBIT A




TERMINATION AND CHANGE IN CONTROL PROVISIONS UNDER THE

EXPRESS SCRIPTS, INC.

2011 LONG-TERM INCENTIVE PLAN

STOCK OPTION GRANT NOTICE

FOR NON-EMPLOYEE DIRECTORS



  I. Termination of Service of Non-Employee Director




     (A) Generally. Except as provided herein, if Optionee’s service as a member of the Board
terminates, then any portion of the Option that has not vested as of the date of such termination
shall terminate as of such date, and the unvested portion of the Option shall be forfeited to the
Company without payment therefor.



     (B) Death. If Optionee’s service as a member of the Board terminates because of his or her
death, then the Option, to the extent it has not expired or been terminated, shall vest and become
exercisable in full, and may be exercised by the Optionee’s Successor at any time, or from time to
time, within one year after the date of Optionee’s death.



     (C) Disability. If Optionee’s service as a member of the Board terminates because of
Disability, then the Option, to the extent it has not expired or been terminated, shall vest and
become exercisable in full, and Optionee or Optionee’s Successor may exercise such Option at any
time, or from time to time, within one year after the date of Optionee’s Disability.



     (D) Retirement. The termination of Optionee’s service as a member of the Board after
attainment of age 65 for any reason other than death or Disability shall be considered a
Retirement, subject to the following:




	 	1.	 	Tenured Retirement. After attainment of age 70, Optionee’s
Retirement shall be deemed to be a “Tenured Retirement”. Upon a Tenured
Retirement, the Option, to the extent it has not expired or been terminated, shall
vest and become exercisable in full, and may be exercised by the Optionee, or
Optionee’s Successor at any time, or from time to time, up to and including the
date the Option expires.
	 
	 	2.	 	Early Retirement. If Optionee has attained the age of 65, but
not age 70, and has at least ten years of service on the Board, then Optionee’s
Retirement shall be deemed to be an “Early Retirement”. Upon an Early Retirement,
the following shall occur:






	 	(a)	 	any portion of the Option which has vested but not
yet been exercised as of the date of the Retirement shall remain vested
and fully-exercisable by the Optionee, or Optionee’s Successor at any
time, or from time to time, up to and until the first to occur of (i) the
four-year anniversary of the date of the Retirement, or (ii) the date the
Option expires;
	 
	 	(b)	 	for any portion of the Option which has not vested,
expired or otherwise been terminated as of date of the Retirement, a
pro-rata portion thereof (determined as set forth below) shall remain in
effect and vest and become exercisable in accordance with the original
vesting schedule, and following such vesting shall be fully-exercisable by
the Optionee, or Optionee’s Successor at any time, or from time to time,
up to and until the first to occur of (i) the four-year anniversary of the
date of the Retirement, or (ii) the date the Option expires;




 









 












	 	(c)	 	the pro-rata portion of the Option that continues to
vest under the preceding paragraph shall be a percentage which is equal to
(i) the number of full months served by Optionee past age 65, divided by
(ii) 60. The remaining portion of the Option that is not eligible for
continued vesting under the preceding paragraph shall immediately
terminate upon Retirement.






	 	3.	 	Death or Disability While Eligible for Retirement. If
Optionee’s service as a member of the Board terminates because of his or her death
or Disability and, at the time of such termination of service on the Board Optionee
would have been eligible for either a Tenured Retirement or an Early Retirement,
Optionee or Optionee’s Successor may elect to have the Option treated as if
Optionee’s service had terminated due to such applicable form of Retirement (rather
than due to death or Disability, as applicable). Such election shall be made
through the delivery of an irrevocable notice indicating such desired treatment to
the Company’s General Counsel no less than 60 days after the date of Optionee’s
death or Disability (as applicable).
	 
	 	4.	 	Standard Retirement. Any Retirement that is not either a
Tenured Retirement or an Early Retirement shall be deemed to be a Standard
Retirement.





     (E) Reasons other than Death, Disability, Tenured Retirement, Early Retirement or Termination
for Cause. If Optionee’s service as a member of the Board terminates due to a Standard Retirement
or for any other reason other than death, Disability, Tenured Retirement or Early Retirement, then
the Option, to the extent it has not expired or been terminated, shall remain exercisable for one
year after termination of Optionee’s service on the Board, but only to the extent that such Option
was exercisable immediately prior to Optionee’s termination of service.



     (F) Expiration of Term. Any portion of the Option that remains unexercisable upon termination
of service as a member of the Board (after taking into account the foregoing paragraphs (A)-(E),
and except as specifically provided in the foregoing paragraph (D)(3)) shall terminate immediately
upon such termination of service as a member of the Board. Any portion of the Option that is, or
becomes, exercisable upon termination of service as a member of the Board (or thereafter pursuant
to the foregoing paragraph (D)(3)) which is not exercised within the applicable period set forth in
the foregoing paragraphs (A)-(E) shall terminate as of the end of the applicable period described
in such paragraphs; provided, however, that the Company may cause, or authorize its third-party to
vendor to cause, any remaining vested portion of the Option to automatically be exercised on the
last date of the applicable period, to the extent it has not previously been exercised or
forfeited. Notwithstanding the foregoing, or any other provision of the Plan, the Stock Option
Agreement, the Grant Notice, or this Schedule 1, in no event shall the Option be exercisable after
expiration of the Term.



   II. Change in Control




     (A) Acceleration of Vesting Upon Change in Control After Which No Public Market for Company or
Exchange Stock Exists



          (i) Acceleration of Vesting. Upon the occurrence of a Change in Control after which
there will be no generally recognized U.S. public market for the Company’s Common Stock or any
common stock for which the Company’s Common Stock is exchanged, the Option, to the extent it has
not expired or been terminated, shall, to the extent not yet exercisable, vest and become
exercisable in full.



 









 




          (ii) Company Payment. Upon the occurrence of a Change in Control transaction after
which there will be no generally recognized U.S. public market for the Company’s Common Stock or
any common stock for which the Company’s Common Stock is exchanged, on the Change in Control Date
the Option shall be automatically cancelled without further action by the Company or the
Optionee, and the Company shall provide payment in connection with such cancellation at a per
share price equal to the excess (if any) of the Change in Control Price (as defined below) over the
exercise price of the Option. The Change in Control Price shall mean the value, expressed in
dollars, as of the date of receipt of the per share consideration received by the Company’s
stockholders whose stock is acquired in a transaction constituting a Change in Control. In case
such all or part of such consideration shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by a majority of the Board of Directors based on
a written opinion by a nationally recognized investment banking firm, whose determination shall be
described in a statement furnished to Participants.



     (B) Acceleration of Vesting Upon Other Change in Control Transactions. Upon the occurrence of
a Change in Control after which there remains a generally recognized U.S. public market for the
Company’s Common Stock or for any common stock for which the Company’s Common Stock is exchanged,
the Option, to the extent it has not expired or been terminated, shall vest and become exercisable
in full and shall remain exercisable for the remainder of the Term.



     (C) Options Not Assumed. Notwithstanding anything herein to the contrary, the Board may
provide for such other treatment of the Option as the Board may determine in its sole discretion
with respect to the Option if it is not assumed or is cancelled in connection with a Change in
Control.