Document:

exv10w02

 

Exhibit 10.2

Amendment No. 1 dated
January 15, 2002,

to U.S. Bancorp 2001 Stock Incentive Plan

Section 2(h) Fair Market Value

     “Fair Market Value” shall mean, with respect to any property (including,
without limitation, any Shares or other securities), the fair market value of
such property determined by such methods or procedures as shall be established
from time to time by the Committee.exv10w03

 

Exhibit 10.3

U.S. BANCORP

1998 EXECUTIVE STOCK INCENTIVE PLAN

(ADOPTED ORIGINALLY IN DECEMBER 1996

AND AS AMENDED THROUGH DECEMBER 1998)

     1.     Name and Purpose. This Plan was adopted originally by Star Banc Corporation
in December 1996, adopted and amended through December 1998 by its successor,
Firstar Corporation, and assumed by U.S. Bancorp (the “Corporation”) as of
February 27, 2001 and shall be known hereafter as the U.S. Bancorp 1998
Executive Stock Incentive Plan (the “Plan”). The purpose of the Plan is to
advance the interests of the Corporation by providing material incentive for
the continued services of directors, advisory directors and key employees and
by attracting able individuals to serve as directors and advisory directors of
the Corporation and by attracting able personnel to employment with the
Corporation and its Subsidiaries. The term “Subsidiary” as used herein means a
subsidiary corporation of the Corporation as the term is defined in Section
424(f) of the Internal Revenue Code of 1986 as amended (the “Code”).

     2.     1986 and 1991 Stock Incentive Plans. The 1986 Stock Incentive Plan (the 1986
Plan) and the 1991 Stock Incentive Plan (the 1991 Plan) adopted by the
Corporation’s successor, Star Banc Corporation, are hereby amended and restated
in their entirety so that their terms and conditions match exactly as the terms
and conditions of this Plan, with the exception that the number of shares
authorized under each such Plan and the termination date of each such Plan,
shall remain unchanged. Grants of remaining authorized shares under the 1986
Plan and the 1991 Plan, and administration of awards made under those Plans,
shall be governed by the terms and conditions set forth therein. In the event
of a conflict between the terms and conditions of the 1986 and 1991 Plans, and
those set forth herein, this document shall govern.

     3.     Administration. The Plan shall be administered by the Compensation
Committee (the “Committee”) of the Board of Directors of the Corporation. The
Committee shall consist of at least two members of the Board of Directors, each
of whom is a “Non-Employee Director” as defined in Rule 16b-3 promulgated by
the Securities and Exchange Commission under the Securities Exchange Act of
1934 (the “1934 Act”), as such Rule may be amended from time to time or any
successor rule thereto. To the extent that it is desired that compensation
resulting from the grant of a particular Option be excluded from the deduction
limitation of Section 162(m) of the Internal Revenue Code of 1986, as amended
(the “Code”), all directors comprising the Committee granting such Option also
shall be “outside directors” within the meaning of Code Section 162(m). The
Committee may establish, subject to the provisions of the Plan, such rules and
regulations as it deems necessary for the proper administration of the Plan,
and make such determinations and take such action in connection therewith, or
in relation to the Plan as it deems necessary or advisable, consistent with the
Plan.

     4.     Eligibility. Directors of the Corporation and its Subsidiaries, and
advisory directors of the Regional Advisory Boards established by the
Corporation (collectively, “Directors”), and regular employees of the
Corporation and its Subsidiaries who are key employees, including officers,
whether or not Directors (collectively, “Eligible Employees”) shall be eligible
to participate in the Plan.

 

 

     5.     Shares Subject to the Plan.

               (a) The shares to be issued and delivered by the Corporation under the
Plan are the Corporation’s common shares, $0.01 par value, which may be either
authorized but unissued shares or treasury shares.

               (b) The aggregate number of common shares of the Corporation which may be
issued under the Plan (excluding those previously authorized under the 1986 and
1991 Plans) shall not exceed forty-five million (45,00,000) shares; subject,
however, to the adjustment provided in Paragraph 14 in the event of stock
splits, stock dividends, exchanges of shares or the like occurring after the
effective date of this Plan. No option may be granted under this Plan, no
Restricted Shares may be allocated under this Plan and no Performance Awards
payable in common stock can be paid under this Plan which could cause such
maximum limit to be exceeded.

               (c) The maximum number of shares with respect to which options may be
granted to any individual during any one year period is 5,400,000.

               (d) Common shares covered by an option which is no longer exercisable with
respect to such shares shall again be available for issuance in connection with
other options granted under this Plan. Common shares repurchased by the
Corporation as provided in Paragraph 12, in respect of which no benefits of
ownership have been received, shall again be available for issuance in
connection with other allocations of Restricted Shares under this Plan.

     6.     Grant of Options. The Committee may from time to time, in its discretion
and subject to the provisions of the Plan, grant options to any or all
Directors and Eligible Employees. With respect to Eligible Employees who are
not subject to the provisions of Section 16 of the 1934 Act or Section 162(m)
of the Code, options may be so granted by the Chief Executive Officer of the
Corporation as the designee of the Committee. Directors and Employees to whom
options have been granted are herein referred to as “Optionees”. Each option
shall be embodied in an “Option Agreement” signed by the Optionee and the
Corporation providing that the option shall be subject to the provisions of
this Plan and containing such other provisions as the Committee may prescribe
not inconsistent with the Plan. Option grants shall specify whether the grant
is made in the Optionee’s capacity as a Director or as an Eligible Employee.

     7.     Terms and Conditions of Option. All options granted under the Plan shall
contain such terms and conditions as the Committee from time to time
determines, subject to the foregoing and following limitations and
requirements.

               (a) Form of Option: Incentive Options and Non-Qualified Options may be
granted under this Plan. An “Incentive Option” shall mean an option granted
under this Plan which is designated to be an incentive stock option under the
provisions of Code Section 422; and any provisions elsewhere in this Plan or in
any such Incentive Option which would prevent such options from being an
incentive stock option may be deleted and/or voided retroactively to the date
of the granting of such option, by action of the Committee. A “Non-Qualified
Option” shall mean an option granted under this Plan which is not an incentive
stock option under the provisions of Code

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Section 422, and which is exercisable even though there is outstanding an
Incentive Option which was granted before the granting of the Non-Qualified
Option to the same Options. Such Non-Qualified Option shall not be affected by
any actions taken retroactively as provided above with respect to Incentive
Options.

               (b) Option Price: The option price per share of an Incentive Option and of
a Non-Qualified Option granted to a Director shall not be less than 100% of the
fair market value of the Corporation’s common shares, as determined by the
Committee in a manner consistent with the requirements of the Code for
incentive stock options.

               (c) Period within which Options May Be Exercised: The period of each
option shall be fixed by the Committee, but no Incentive Option may be
exercised prior to the expiration of one year after the date of granting the
Incentive Option, and no option, whether an Incentive Option or a Non-Qualified
Option, may be exercised after the expiration of ten years from the date the
option is granted.

               (d) Termination of Option by Reason of Termination of Employment: Except
as otherwise provided in Paragraph 15, or by the Committee, either by Committee
action or by provision in any option or other agreement to which an Optionee is
party, if an Optionee’s employment with the Corporation and its Subsidiaries
terminates for any reason regardless of whether by action of the Optionee or
the Corporation or Subsidiary, all options granted under this Plan to such
Optionee which are not exercisable on the date of such termination of
employment shall terminate immediately. Any remaining options shall terminate
if not exercised before the expiration of the following periods, or at such
earlier time as may be applicable under Paragraph 7(c) above:

                         (i) if the option is a Non-Qualified Option, three (3) months immediately
following such termination of employment (unless the Corporation deems the
termination is for gross misconduct or offense, in which case the options shall
terminate immediately upon termination of employment), if such termination was
not a result of early or normal retirement (as determined by the chief
executive officer of the Corporation), death or if the Optionee is disabled (as
defined in Code Section 422(c)(6) — hereinafter “Disability”) of the Optionee;
or

                         (ii) if the option is an Incentive Option, three (3) months immediately
following such termination of employment (unless the Corporation deems the
termination is for gross misconduct or offense, in which case the options shall
terminate immediately upon termination of employment), if such termination was
not a result of early or normal retirement (as determined by the chief
executive officer of the Corporation), death or Disability of the Optionee; or

                         (iii) for all options, one (1) year immediately following the date of
early or normal retirement (as determined by the chief executive officer of the
Corporation), death or commencement of Disability, if the Optionee was an
employee of the Corporation and/or any Subsidiary at the time of his death or
the commencement of Disability or for Non-Qualified Options

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at such later time as the Committee deems appropriate.

               (e) Termination of Option by Reason of Termination of Directorship: Upon
termination of status as a Director, each Optionee shall have one (1) year
following the date of termination or such later time as the Committee deems
appropriate to exercise options granted and fully vested under this Plan.
Except as provided in Paragraphs 15 and 16 of this Plan, no unvested option
will vest after the date on which Director status terminates.

               (f) Non-transferability; Exceptions: Each option and all rights
thereunder shall be exercisable during the Optionee’s lifetime only by the
Optionee and shall be non-assignable and non-transferable by the Optionee,
except that a Non-Qualified Option may be transferred pursuant to a “domestic
relations order” as defined in Section 414(p)(1)(B) of the Code. In the event
of the Optionee’s death, such options and rights thereunder are transferable by
his will or by the laws of descent and distribution. In the event the death of
an Optionee occurs, the representative or representatives of the Optionee’s
estate, or the person or persons who acquired (by bequest or inheritance) the
rights to exercise his stock options granted under this Plan, may exercise any
of the unexercised options in whole or in part prior to the expiration of the
applicable exercise period, as specified in Paragraph 7(d) above.

               (g) More than One Option Granted to an Optionee: More than one option,
and more than one form of option, may be granted to an Optionee under this
Plan; provided, however, that the aggregate fair market value (determined as of
the time the option is granted) of the shares for which Incentive Options are
exercisable for the first time by any Optionee during any calendar year (under
the Plan and all such plans of the Corporation and any parent or subsidiary
corporation) shall not exceed $100,000 or any other limit established by the
Code. A single option grant may include both an Incentive Option and a
Non-Qualified Option.

     8.     Method of Exercise of Options. An Optionee may exercise a stock option by
delivering an option exercise form to the Committee, and arranging for the
satisfaction of the exercise price and any tax withholding obligation (as
provided in Paragraph 20). The exercise price and tax withholding obligation
may be satisfied (i) by check; (ii) by delivery of common shares of the
Corporation previously owned by the Optionee, valued at fair market value when
the option is exercised, subject to the limits described below, or (iii)
through a broker cashless exercise procedure. Common shares of the Corporation
may be delivered to satisfy the exercise price only if the shares have been
held by the Optionee for at least six months before delivery, and have not been
used for another option exercise during this period. Shares held by an
Optionee which formerly were Restricted Shares may not be used for this purpose
until six months have elapsed after the restrictions under Paragraph 10 have
terminated with respect to such shares. Use of previously owned shares may be
effected by actual delivery of the stock certificates to the Corporation, or by
completing an affidavit available from the Committee affirming that the
Optionee owns the necessary shares and that any applicable holding period has
been satisfied. Upon receipt of the exercise price, the Corporation shall
deliver a certificate representing the common shares acquired upon exercise to
the Optionee or, in the case of a Non-Qualified Option, to such other recipient
as directed by the Optionee. An Optionee wishing to use the cashless exercise
procedure is required to elect to have a broker sell a sufficient number of
common shares of the Corporation to satisfy the

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option exercise price. The Optionee may elect to have the broker sell
additional shares to satisfy the tax withholding amount, or sell up to the full
number of shares subject to the option exercise. Following the broker’s
delivery to the Corporation of the proceeds necessary to satisfy the exercise
price and the tax withholding obligation, the Corporation will deliver to the
broker the number of shares previously sold by the broker at the Optionee’s
direction, and will deliver any remaining amount of cash or shares to the
Optionee or, in the case of a Non-Qualified Option, to such other recipient as
directed by the Optionee.

     9.     Allocation and Purchase of Restricted Shares.

               (a) The Committee may from time to time, in its discretion and subject to
the provisions of the Plan, allocate common shares to any or all Directors and
Eligible Employees. Common shares allocated under this Paragraph 9 of the Plan
are referred to herein as “Restricted Shares.” Directors and Employees to whom
Restricted Shares have been allocated are herein referred to as “Participants.”
Each Participant to whom an allocation of Restricted Shares has been made shall
have the right to purchase such Restricted Shares as herein provided. Each
allocation shall specify whether the Participant has received such allocation
in the Participant’s capacity as a Director or as an Eligible Employee.

               (b) The Committee shall advise each Participant to whom an allocation of
Restricted Shares has been made in writing of the terms of the offer, including
the number of shares which such person shall be entitled to purchase, the
purchase price per share, and any other terms, conditions and restrictions
relating thereto. The Participant shall have ten (10) days from the date of
the offer to accept such offer. The Committee may, in the exercise of its
discretion, extend the term of any offer. Subject to the express provisions of
the Plan, the Committee shall have the power to make such offer subject to any
terms and conditions it may establish and the offers made to different persons,
or to the same person at different times, may be subject to terms, conditions
and restrictions which differ from each other. Each allocation shall be
embodied in a “Restricted Share Agreement” signed by the Participant and the
Corporation providing that the Restricted Shares shall be subject to the
provisions of this Plan and containing such other provisions the Committee may
prescribe not inconsistent with the Plan.

               (c) The purchase price of the shares offered under this Plan shall be any
lawful consideration established by the Committee in its discretion. If a
Participant elects to purchase Restricted Shares, he shall pay the purchase
price in full, at the principal office of the Corporation, prior to expiration
of the offer. Upon payment of the purchase price, certificates representing
the shares shall be issued to the Participant, which certificates shall bear an
appropriate legend reflecting that such shares are subject to the restrictions
contained in this Plan.

     10.     Restrictions Applicable to Restricted Shares. By purchasing the Restricted
Shares allocated to a Participant under this Plan, the Participant agrees and
consents to the restrictions described in this Plan for a period determined by
the Committee at the time of such allocation, said period referred to herein as
the “Restricted Period.” For the duration of the Restricted Period (unless the
restrictions earlier lapse or are removed by the Committee), Restricted Shares
issued under this Plan shall be held in escrow by Firstar Bank, N.A., and
shall not be transferred,

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delivered, assigned, sold, or disposed of in any manner, nor pledged or
otherwise hypothecated. On the last day of the Restricted Period, or upon the
earlier lapse or removal of restrictions, such Restricted Shares shall cease to
be subject to the restrictions under this Paragraph 10 of the Plan.

     11.     Termination of Directorship or Employment During Restricted Period.

               (a) Except as provided in Paragraphs 15 and 16 of this Plan, if a Director
ceases to serve as a Director, the restrictions of Paragraph 10 of this Plan
shall automatically terminate as to that number of the Restricted Shares owned
by the Director which is equal to the total number of such Restricted Shares
multiplied by fraction, the numerator of which is the number of full months
which have elapsed from the date of allocation and the denominator of which is
the number of total months during the Restricted Period. The Director (or his
or her estate, heirs, or legatees) shall be required to resell the remaining
Restricted Shares to the Corporation at a price per share equal to the original
purchase price paid by the Director for such shares, unless the Committee
shall, in its discretion, waive the restrictions under Paragraph 10 as to any
part or all of such remaining Restricted Shares.

               (b) If an Eligible Employee’s employment with the Corporation and its
Subsidiaries terminates because of death, Disability, or retirement after
attaining normal retirement age under the provisions of any retirement plan of
the Corporation or any Subsidiary, the restrictions under Paragraph 10 of this
Plan shall automatically terminate as to that number of the Restricted Shares
owned by such Participant which is equal to the total number of such Restricted
Shares multiplied by a fraction, the numerator of which is the number of full
months which have elapsed from the date of allocation and the denominator of
which is the total number of months during the Restricted Period. The
Participant (or his or her estate, heirs, or legatees) shall be required to
resell the remaining Restricted Shares to the Corporation at a price per share
equal to the original purchase price paid by the Participant for such shares,
unless the Committee shall, in its discretion, waive the restrictions under
Paragraph 10 as to any part or all of such remaining Restricted Shares.

               (c) If employment with the Corporation and its Subsidiaries terminates
during the Restricted Period for any reason regardless of whether by action of
the Eligible Employee or the Corporation or Subsidiary other than by reason of
death, Disability, or retirement after attaining normal retirement age under
the provisions of any retirement plan of the Corporation or its Subsidiaries,
such Participant shall be required to resell all of the Restricted Shares to
the Corporation at a price per share equal to the original purchase price paid
by the Participant for such shares, unless the Committee shall, in its
discretion, waive the restrictions under Paragraph 8 as to any part or all of
the Restricted Shares.

     12.     Resale of Restricted Shares. In the event a Participant is required to
resell Restricted Shares to the Corporation as the result of the termination of
the Participant’s directorship or employment as described in Paragraph 11, the
Corporation by written notice to the Participant shall specify a date not less
than five nor more than ten days from the date of such notice to consummate the
purchase and sale of such Restricted Shares at the principal office of the
Corporation. The Participant shall deliver to the Corporation certificates
representing such Restricted Shares, duly

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endorsed and in proper form for transfer, and upon the receipt of such share
certificates, the Corporation shall deliver to the Participant a check in the
amount of the purchase price. If the Participant fails to deliver the share
certificates to the Corporation at the time specified in such notice, the
Corporation may deposit the purchase price with the Treasurer of the
Corporation, and thereafter the shares shall be deemed to have been transferred
to the Corporation and the Participant, despite his failure to deliver the
share certificates, shall have no further rights as a stockholder of the
Corporation. In such event, the Treasurer of the Corporation shall continue to
hold the purchase price for such shares and shall make payment thereof, without
interest, upon delivery of the share certificates to the Corporation.

     13.     Performance Awards. The Committee may, from time to time, in its
discretion and subject to the provisions of the Plan, provide an incentive
opportunity (“Performance Awards”) to any or all Directors and Eligible
Employees based on achievement by the Corporation for any calendar year or
other period chosen by the Committee. Each Performance Award shall be embodied
in a “Performance Award Agreement” signed by the Participant and the
Corporation providing that the Performance Award shall be subject to the
provisions of this Plan and containing such other provisions as the Committee
may prescribe not inconsistent with the Plan. The Committee will determine, in
its sole discretion, the performance targets and whether Performance Awards
should be payable in the form of the Corporation’s common shares or cash. If
the Eligible Employee requests, prior to the date on which payment of the
Performance Award is to be made, that such payment not be made until
termination of employment by such Eligible Employee, then the Committee shall
consider and act upon such request promptly. If no request is made by such
Eligible Employee, the payment shall be made in the time period chosen by the
Committee.

     14.     Share Adjustments. In the event there is any change in the Corporation’s
common shares resulting from stock splits, stock dividends, combinations or
exchange of shares, or other similar capital adjustments, equitable
proportionate adjustments shall be made by the Committee in (a) the number of
shares available for option and issuance under this Plan, (b) the number of
shares subject to options granted under this Plan, and (c) the option price of
optioned shares.

     15.     Merger, Consolidation, or Sale of Assets or Change of Control. Except as
otherwise provided in any Option Agreement, Restricted Share Agreement,
Performance Award Agreement or other agreement approved by the Committee to
which any Director or Eligible Employee is a party, in the event the
Corporation shall engage in a Change of Control, as defined in this Paragraph
15, each option, Restricted Share and Performance Award held by (a) a Director;
or (b) an Eligible Employee if the employment of the Eligible Employee is
terminated by the Corporation immediately following such Change of Control due
to business needs resulting from the Change of Control, and not for documented
performance or conduct reasons, consistent with written policies of the
Corporation: shall, without regard to any vesting schedule, restriction or
performance target, automatically become fully exercisable or payable, as the
case may be, immediately prior to such Change of Control in the case of a
Director and as of the date of such termination in the case of an Eligible
Employee. Options and restricted shares granted under this Plan shall continue
as provided in Paragraph 17.

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     For purposes of this Agreement, a Change of Control of the Corporation
shall mean:

               (a) The acquisition by any individual, entity or group within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act” a (“Person”) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of
either (i) the then outstanding shares of common stock of the Corporation (the
“outstanding Corporation Common Stock”) or (ii) the combined voting power of
the then outstanding voting securities of the Corporation entitled to vote
generally in the election of directors (the “Outstanding Corporation Voting
Securities”); provided, however, that for purposes of this subsection (a), the
following acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Corporation, (ii) any acquisition by the
Corporation, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Corporation or any corporation controlled
by the company, or (iv) any acquisition by any corporation pursuant to a
transaction which complies with clauses (i),(ii), and (iii) of subsection (c)
of this Paragraph 15; or

               (b) Individuals who, as of the date hereof, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of
the Board; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election by the
Corporation’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, 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 Board; or

               (c) Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the Corporation
(a “Business Combination”), in each case, unless, following such Business
Combination, (i), all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Corporation Common
Stock and Outstanding Corporation 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 and 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 Corporation or all
or substantially all of the Corporation’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 Corporation
Common Stock and Outstanding Corporation Voting Securities, as the case may be,
(ii) no Person (excluding any employee benefit plan (or related trust) of the
Corporation 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 (iii) at least a majority of the
members of the board

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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, providing for such Business
Combination; or

               (d) Approval by the shareholders of the Corporation of a complete
liquidation or dissolution of the Corporation.

     16.     Termination of Directorship with 10 years of Service. Except as otherwise
provided in any Option Agreement, or other Agreement approved by the Committee
to which a Director is a party, in the event a Director ceases to serve as a
Director with the Corporation, after having served as a Director for at least
ten (10) years, each option and/or performance award shall, without regard to
any vesting schedule, restriction or performance target, automatically and
immediately become fully exercisable or payable, as the case may be, and any
remaining restrictions under Paragraph 10 shall cease, immediately prior to
such termination.

     17.     Amendment or Termination. The Board of Directors of the Corporation may
terminate this Plan at any time, and may amend the Plan at any time or from
time to time, without obtaining any approval of the Corporation’s stockholders,
except that the Plan may not be amended (a) to increase the aggregate number of
shares issuable under the Plan for incentive stock options (but not
nonqualified stock options and excepting proportionate adjustments made under
Paragraph 14 to give effect to stock splits, etc); (b) to change the option
price of optioned stock (excepting proportionate adjustments made under
Paragraph 14); (c) to change the requirement that the option price per share of
common stock covered by an incentive stock option (but not a nonqualified stock
option) granted under this plan not be less than 100% of the fair market value
of the Corporation’s common stock on the date such option is granted; (d) to
extend the time within which options may be granted or the time without which a
granted option may be exercised; or (e) to change, without the consent of the
Optionee (or the Optionee’s, or the Optionee’s estate’s, legal representative),
any option previously granted to him or her under the plan. If the Plan is
terminated following a Change in Control as defined in Paragraph 15 of this
Agreement or for any other reason, any unexercised option shall continue to be
exercisable in accordance with its terms and the terms of this Plan,
consistently with Section 424(a) of the Internal Revenue Code, which provides
for a conversion of an existing option to an option to acquire stock in the
Business Combination at the ratio of fair market price to option price
immediately before the Change in Control and Restricted Shares shall continue
to be subject to the terms of this Plan (subject to conversion to Restricted
Shares of the Business Combination at the same ratio of fair market price to
option price immediately before the Change in Control) for the duration of the
Restricted Period.

     18.     Corporation Responsibility. All expenses of this Plan, including the cost
of maintaining records, shall be borne by the Corporation. The Corporation
shall have no responsibility or liability (other than under applicable
Securities Acts) for any act or thing done or left undone with respect to the
price, time, quantity, or other conditions and circumstances of the purchase of
shares under the terms of the Plan, so long as the Corporation acts in good
faith.

     19.     Implied Consent of Optionees and Participants. Every Optionee, by his or
her acceptance of an option under this Plan, and every Participant, by his or
her acceptance of an

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allocation of Restricted Shares under this Plan, and every Director and
Eligible Employee, by his or her acceptance of a Performance Award under this
Plan, shall be deemed to have consented to be bound, on his or her own behalf
and on behalf of his or her heirs, assigns, and legal representatives, by all
of the terms and conditions of this Plan.

     20.     No Effect on Director or Employment Status. The fact that a Director or
Eligible Employee has been granted an option, has been allocated Restricted
Shares or awarded a Performance Award under this Plan shall not limit or
otherwise qualify the right of the Corporation or any Subsidiary to terminate
such person’s directorship or employment at any time.

     21.     Tax Withholding. The Corporation shall be entitled to deduct from any
payment to be made by it under this Plan, or to otherwise require, prior to the
issuance or delivery of any shares or the payment of any cash to a Director or
Eligible Employee, payment by the Director or Eligible Employee of all
applicable Federal, state, local or other taxes required by law to be withheld.
The Committee may permit, in accordance with any applicable administrative
rules established by it, a Director or Eligible Employee to satisfy this
withholding obligation by (i) directing the withholding from any payment of
common shares by the Corporation, or (ii) delivering to the Corporation, common
shares having a fair market value, on the date of payment, equal to the amount
of such taxes. Any fraction of a share required to satisfy such tax obligation
shall be disregarded and the amount due shall be paid instead in cash by the
Director or Eligible Employee.

     22.     Compliance with Securities Laws. Options granted and shares issued by the
Corporation pursuant to this Plan shall be granted and issued only in full
compliance with all applicable securities laws, including laws, rules and
regulations of the Securities and Exchange Commission and applicable state Blue
Sky laws. With respect thereto, the Committee may impose such conditions on
transfer, restrictions and limitations as it may deem necessary and appropriate
to assure compliance with such applicable securities laws.

     23.     Duration and Termination of the Plan. The Plan became effective as of
December 10, 1996, was amended effective as of December 8, 1998 and was assumed
by the Corporation as of February 27, 2001. No option shall be granted and no
allocation of Restricted Shares shall be made under the Plan subsequent to
December 9, 2006.

U.S. Bancorp. .SIP

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