EXHIBIT 10.3


 


3M COMPANY


3M 2008 LONG-TERM INCENTIVE PLAN


 


STOCK OPTION AGREEMENT


FOR U.S. EMPLOYEES


 


[PARTICIPANT
NAME]


 


1.  Grant of Option.  This Agreement confirms that on [GRANT DATE] (the “Grant
Date”), 3M Company (the “Company”) granted you
a Nonqualified Stock Option (the “Option”) to purchase [NUMBER OF SHARES
GRANTED] shares of Common Stock of the Company at the exercise price of [GRANT
PRICE] per share (the “Exercise Price”), subject to the terms and conditions of
this Agreement and the 2008 Long-Term Incentive Plan (the “2008 Plan”).


 


2.  Definitions.  Capitalized terms used and not
defined herein shall have the same meaning as in the 2008 Plan.


 


3.  Vesting and Term of Option.  Your Option will vest over three years, as
long as you remain continuously employed by the Company or an Affiliate from
the Grant Date until each vesting date or if you die or Retire before any such
date.  This means that you may exercise
the first one-third of the shares subject to this Option on or after the first
anniversary of the Grant Date, the second one-third of these shares on or after
the second anniversary of the Grant Date, and the remaining one-third of these
shares on or after the third anniversary of the Grant Date, assuming continued
employment.  However, you will be
required to accept this Option as well as this Agreement before being permitted
to exercise the Option.  This Option will
expire on and may not be exercised after the earlier of February 8, 2019
or the 90th day following the end of your 3M
employment, except in cases of Retirement, death, disability, Disqualifying
Termination or a termination in connection with which you execute a written
release of employment-related claims in favor of the Company that provides
(with the approval of the Company) for the nonforfeiture of stock options (but
only to the extent this Option has vested prior to the date of the termination
of your employment).


 


4.  Nature of Grant. 
In accepting the grant of this Option, you acknowledge that:


 


(a)           the 2008 Plan is established
voluntarily by the Company, it is discretionary in nature and it may be
modified, amended, suspended or terminated by the Company at any time, unless
otherwise provided in the 2008 Plan;


 


(b)           the grant of the Option is voluntary
and occasional and does not create any contractual or other right to receive
future grants of options, or benefits in lieu of options, even if options have
been granted repeatedly in the past;


 


(c)           all decisions with respect to future
option grants, if any, will be at the sole discretion of the Compensation
Committee of the 3M Board of Directors;


 


(d)           your participation in the 2008 Plan
shall not create a right to further employment with your employer and shall not
interfere with the ability of your employer to terminate your employment
relationship at any time with or without cause;


 


(e)           the Option is not part of your
regular or expected compensation for any purpose, including, but not limited
to, calculating any severance payments, bonuses, life insurance, disability,
pension or retirement benefits or similar payments;


 


(f)            the Company is not providing
any tax, legal or financial advice, nor is the


 


 


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Company making any
recommendations regarding your participation in the 2008 Plan, or your
acquisition or sale of the underlying shares of Common Stock; and


 


(g)           you are hereby advised to consult with your own personal
tax, legal and financial advisors regarding your participation in the 2008 Plan
before taking any action related to the 2008 Plan.


 


5.  Transferability. 
This Option is not transferable except in the event of your death, in
accordance with the provisions of Section 13 of the 2008 Plan.


 


6.  Governing Law. 
This Option and the provisions of this Agreement are governed by, and
subject to, the laws of the State of Delaware, as provided in the 2008 Plan.


 


For purposes of
litigating any dispute that arises concerning the grant of this Option or this
Agreement, you and the Company agree and consent to the jurisdiction of the State
of Minnesota, and agree that such litigation shall be conducted in the courts
of Ramsey County, Minnesota, or the federal courts for the United States for
the District of Minnesota, where this grant is made and/or to be performed.


 


7.  Entire
Agreement.  The 2008
Plan and this Agreement constitute the entire agreement of the parties and
supersede all prior undertakings and agreements with respect to the subject
matter contained herein.


 


By
accepting the grant of this Option, you agree to all of the terms and
conditions described above and in the 2008 Plan.


 


 


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