Exhibit 10.1

Grant No.             

THE GAP, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

The Gap, Inc. (the “Company”) hereby grants to                      (the “Employee”), a stock option under The Gap, Inc. 2006 Long-Term Incentive Plan (the “Plan”), to purchase shares of common stock of the Company, $0.05 par value (“Shares”). This option is subject to all of the terms and conditions contained in this Agreement, including the terms and conditions contained in the attached Appendix A. The date of this Agreement is                      . Subject to the provisions of Appendix A and of the Plan, the principal features of this option are as follows:

As provided in the Plan and in this Agreement, this option may terminate before the date written above, including before the option becomes exercisable or is exercised. For example, if Employee’s employment ends before the date this option becomes exercisable, this option will terminate at the same time as Employee’s employment terminates. See paragraphs 5 and 6 of Appendix A for further information concerning how changes in employment affect termination of this option. PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS OF THIS OPTION.

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement, in duplicate, to be effective as of the date first above written.

My signature below indicates that I understand that this Option is 1) subject to all of the terms and conditions of this Agreement (including the attached Appendix A) and of the Plan, 2) not considered salary, nor is it a promise for future grants of Stock Options, 3) not a term or condition of my employment with the Company, and 4) made at the sole discretion of the Company.

APPENDIX A

TERMS AND CONDITIONS OF NON-QUALIFIED STOCK OPTION

1. Grant of Option . The Company hereby grants to Employee under the Plan, as a separate incentive in connection with his or her employment and not in lieu of any salary or other compensation for his or her services, a non-qualified stock option to purchase, on the terms and conditions set forth in this Agreement and the Plan, all or any part of the number of Shares set forth on page 1 of this Agreement. The option granted hereby is not intended to be an Incentive Stock Option within the meaning of Section 422 of the Code.

2. Exercise Price . The purchase price per Share (the “Option Price”) shall be equal to the price set forth on page 1 of this Agreement. The Option Price shall be payable in the legal tender of the United States.

3. Number of Shares . The number and class of Shares specified in paragraph 1 above, and/or the Option Price, are subject to appropriate adjustment in the event of changes in the capital stock of the Company by reason of stock dividends, split-ups or combinations of shares, reclassifications, mergers, consolidations, reorganizations or liquidations. Subject to any required action of the stockholders of the Company, if the Company shall be the surviving corporation in any merger or consolidation, the option granted hereunder (to the extent that it is still outstanding) shall pertain to and apply to the securities to which a holder of the same number of Shares that are then subject to the option would have been entitled. To the extent that the foregoing adjustments relate to stock or securities of the Company, such adjustments shall be made by the Compensation and Management Development Committee of the Company’s Board of Directors (the “Committee”), whose determination in that respect shall be final, binding and conclusive.

4. Commencement of Exercisability . Except as otherwise provided in this Agreement, the right to exercise the option awarded by this Agreement shall accrue as set forth on page 1 of this Agreement, assuming that Employee is still employed with the Company or an Affiliate through such date(s). If Employee is not employed on such date(s), the option shall terminate, as set out in paragraph 6.

5. Postponement of Exercisability . Notwithstanding paragraph 4 or any other provision of this Agreement, prior to the date this option is scheduled to become exercisable, the Committee, in its sole discretion, may determine that the right to exercise the option awarded by this Agreement shall accrue on a date later than such date. The Committee shall exercise its power to postpone the commencement of exercisability only if the Committee, in its sole discretion, determines that Employee has taken a personal leave of absence (as defined from time to time by the Committee) since the date of this Agreement. The duration of the period of postponement shall equal the duration of the personal leave of absence. If Employee does not return from the personal leave of absence, the option shall terminate as set out in paragraph 6.

6. Termination of Option . In the event that Employee’s employment with the Company or an Affiliate terminates for any reason other than Retirement (as defined in the Plan) or death, this option shall immediately thereupon terminate, except that Employee shall have three (3) months from such termination to exercise any unexercised portion of the option which is then exercisable. In the event of Employee’s Retirement, Employee may, within one (1) year after the date of such Retirement, or within ten (10) years from the date of this Agreement, whichever shall first occur, exercise any unexercised portion of the option (whether or not exercisable). In the event that Employee shall die while in the employ of the Company or an Affiliate, any unexercised portion of the option (whether or not exercisable) may be exercised by Employee’s beneficiary or transferee, as hereinafter provided, for a period of one (1) year after the date of Employee’s death or within ten (10) years from the date of this Agreement, whichever shall first occur. Notwithstanding the preceding two sentences, in the event that within one year of the date of this Agreement, Employee dies or terminates employment due to Retirement, this option shall immediately thereupon terminate.

7. Persons Eligible to Exercise . The option shall be exercisable during Employee’s lifetime only by Employee. The option shall be non-transferable by Employee other than by a beneficiary designation made in a form and manner acceptable to the Committee, or by will or the applicable laws of descent and distribution.

8. Death of Employee . To the extent exercisable after Employee’s death, the option shall be exercised only by Employee’s designated beneficiary or beneficiaries, or if no beneficiary survives Employee, by the person or persons entitled to the option under Employee’s will, or if Employee shall fail to make testamentary disposition of the option, his or her legal representative. Any transferee exercising the option must furnish the Company (a) written notice of his or her status as transferee, (b) evidence satisfactory to the Company to establish the validity of the transfer of the option and compliance with any laws or regulations pertaining to said transfer, and (c) written acceptance of the terms and conditions of the option as prescribed in this Agreement.

9. Exercise of Option . The option may be exercised by the person then entitled to do so as to any Shares which may then be purchased (a) by giving written notice of exercise to the Company, specifying the number of full Shares to be purchased and accompanied by full payment of the purchase price thereof (and the amount of any income tax the Company determines is required to be withheld by reason of such exercise), and (b) by giving satisfactory assurances in writing if requested by the Company, signed by the person exercising the option, that the Shares to be purchased upon such exercise are being purchased for investment and not with a view to the distribution thereof.

10. No Rights of Stockholder . Neither Employee nor any person claiming under or through said Employee shall be or have any of the rights or privileges of a stockholder of the Company in respect of any of the Shares issuable upon the exercise of the option, unless and until certificates representing such Shares shall have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to Employee.

11. No Right to Continued Employment . Employee understands and agrees that this Agreement does not impact in any way the right of the Company, or the Affiliate employing Employee, as the case may be, to terminate or change the terms of the employment of Employee at any time for any reason whatsoever, with or without good cause. Employee understands and agrees that his or her employment is “at-will” and that either the Company or Employee may terminate Employee’s employment at any time and for any reason. Employee also understands and agrees that his or her “at-will” status can only be changed by an express written contract signed by an authorized officer of the Company and Employee.

12. Addresses for Notices . Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company, in care of its Legal Department, at The Gap, Inc., 2 Folsom, 13 ^th Floor, San Francisco, California 94105, or at such other address as the Company may hereafter designate in writing. Any notice to be given to Employee shall be addressed to Employee at the address set forth beneath Employee’s signature hereto, or at such other address as Employee may hereafter designate in writing. Any such notice shall be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, registered or certified and deposited, postage and registry fee prepaid, in a United States post office.

13. Non-Transferability of Option . Except as otherwise herein provided, the option herein granted and the rights and privileges conferred hereby shall not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of said option, or of any right or privilege conferred hereby, contrary to the provisions hereof, or upon any attempted sale under any execution, attachment or similar process upon the rights and privileges conferred hereby, said option and the rights and privileges conferred hereby shall immediately become null and void.

14. Maximum Term of Option . Notwithstanding any other provision of this Agreement, this option is not exercisable after the expiration of ten (10) years from the date of this Agreement.

15. Binding Agreement . Subject to the limitation on the transferability of the option contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.

16. Plan Governs . This Agreement is subject to all terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan shall govern. Terms used and not defined in this Agreement shall have the meaning set forth in the Plan.

17. Committee Authority . The Committee shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon Employee, the Company and all other interested persons. No member of the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.

18. Captions . Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

19. Modifications to this Agreement . This Agreement constitutes the entire understanding of the parties on the subjects covered. Employee expressly warrants that he or she is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement or the Plan can be made only in an express written contract executed by a duly authorized officer of the Company.

20. Agreement Severable . In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

Exhibit 10.2

Award No.             

THE GAP, INC.

STOCK AWARD AGREEMENT ¹

The Gap, Inc. (the “Company”) hereby grants to                      (the “Employee”), an award (the “Award”) of Performance Units (each Performance Unit shall be referred to as a “Stock Award”) which represent the right to receive shares of the Company’s common stock, $0.05 par value (the “Shares”) subject to the fulfillment of the vesting conditions and other conditions set forth in the attached Appendix A. This Award is granted pursuant to The Gap, Inc. 2006 Long-Term Incentive Plan (the “Plan”) and is subject to all of the terms and conditions contained in this Stock Award Agreement (the “Agreement”), including the terms and conditions contained in the attached Appendix A. The date of this Agreement is                      . Subject to the provisions of Appendix A and of the Plan, the principal features of this Award are as follows:

As provided in the Plan and in this Agreement, this Award may terminate before the scheduled vest date(s) of the Stock Awards. For example, if Employee’s employment ends before the date this Award vests, this Award will terminate at the same time as such termination. Important additional information on vesting and forfeiture of the Stock Awards covered by this Award including those due to changes in employment is contained in paragraphs 3 through 5 of Appendix A.

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement, in duplicate, to be effective as of the date first above written.

My signature below indicates that I understand that this Award is 1) subject to all of the terms and conditions of this Agreement (including the attached Appendix A) and of the Plan, 2) not considered salary, nor is it a promise for future grants of Stock Awards, 3) not a term or condition of my employment with the Company, and 4) made at the sole discretion of the Company.

APPENDIX A

TERMS AND CONDITIONS OF STOCK AWARD

1. Grant of Stock Awards . The Company hereby grants to the Employee as a separate incentive in connection with his or her employment and not in lieu of any salary or other compensation for his or her services, an Award with respect to the number of Stock Awards set forth on page 1 of this Agreement, subject to all the terms and conditions in this Agreement and the Plan. Employee understands and agrees that this Award does not guarantee any future Stock Award grants and that grants are made at the sole discretion of the Company.

2. Company’s Obligation to Pay . On any date, a Stock Award has a value equal to the Fair Market Value of one Share. Unless and until a Stock Award has vested in accordance with the vesting schedule set forth on the first page of this Agreement, the Employee will have no right to payment of a Share with respect to the Stock Award. Prior to actual payment of any Shares pursuant to vested Stock Awards, each Stock Award represents an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company.

3. Vesting of Stock Awards and Issuance of Shares . Subject to paragraphs 4 and 5, the Stock Awards subject to this Agreement will vest as to the number of Stock Awards, and on the dates shown, on the first page of this Agreement (each a “Vesting Date”), but in each case, only if the Employee has been continuously employed by the Company or by one of its Affiliates from the date of this Award until the applicable Vesting Date of the Stock Awards. If Employee is not employed on such date(s), the Award shall terminate, as set forth in paragraph 5. Upon each Vesting Date, one Share shall be issued for each Stock Award that vests on such Vesting Date, subject to the terms and provisions of the Plan and this Agreement. No fractional Shares shall be issued under this Agreement.

4. Death or Retirement . In the event of the Employee’s death or Retirement (as defined in the Plan), the remaining Stock Awards shall become fully vested on the date of death or Retirement, as applicable. Notwithstanding the previous sentence, if in the event that within one year of the date of this Agreement, Employee dies or terminates employment due to Retirement, this Stock Award shall immediately thereupon terminate.

5. Termination of Service. Notwithstanding any contrary provision of this Agreement, the balance of the Stock Awards that have not vested pursuant to paragraph 3 or 4 will be forfeited and cancelled automatically at the time of the Employee’s Termination of Service.

6. Withholding Taxes . On each Vesting Date, the Employee agrees that the Company will withhold a portion of the Shares scheduled to be issued pursuant to vested Stock Awards that have an aggregate market value sufficient to pay the federal, state and local income, employment and any other applicable taxes required to be withheld by the Company or its designated Affiliate. The Company will only withhold whole Shares and therefore the Employee also authorizes deduction without notice from salary or other amounts payable to the Employee of cash in an amount sufficient to satisfy the Company’s remaining tax withholding obligation. Notwithstanding the previous two sentences, the Employee, if the Company in its sole discretion so agrees, may elect to furnish to the Company written notice, no more than 30 days and no less than 5 days in advance of a scheduled Vesting Date, of his or her intent to satisfy the tax withholding requirement by remitting the full amount of the tax withholding to the Company on the scheduled Vesting Date. In the event that Employee provides such written notice and fails to satisfy the tax withholding requirement by the Vesting date, the Company shall satisfy the tax withholding requirement pursuant to the first two sentences of this section.

7. Beneficiary Designation . Any distribution or delivery to be made to the Employee under this Agreement will, if the Employee is then deceased, be made to the Employee’s designated beneficiary, or if no such beneficiary survives the Employee, the person or persons entitled to such distribution or delivery under the Employee’s will or, if the Employee should fail to make testamentary disposition of such property, the executor of his or her estate. In order to be effective, a beneficiary designation must be made by the Employee in a form and manner acceptable to the Company. Any transferee must furnish the Company with (a) written notice of his or her status as transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.

8. Conditions to Issuance of Shares . The Shares deliverable to the Employee on the Vesting Date(s) may be either previously authorized but unissued Shares or issued Shares that have been reacquired by the Company. The Company shall not be required to issue any Shares hereunder so long as the Company

reasonably anticipates that such issuance will violate Federal securities law or other applicable law; provided however, that in such event the Company shall issue such Shares at the earliest possible date at which the Company reasonably anticipates that the issuance of the shares will not cause such violation. For purposes of the previous sentence, any issuance of Shares that would cause inclusion in gross income or the application of any penalty provision or other provision of the Internal Revenue Code shall not be treated as a violation of applicable law.

9. Rights as Stockholder . Neither the Employee nor any person claiming under or through the Employee will have any of the rights or privileges of a stockholder of the Company in respect of any Stock Award unless and until Shares have been issued in accordance with paragraph 3, recorded on the records of the Company or its transfer agents or registrars, and delivered to the Employee. Except as provided in paragraph 10, after such issuance, recordation, and delivery, the Employee will have all the rights of a stockholder of the Company with respect to voting such Shares and receipt of dividends and distributions on such Shares.

10. Changes in Stock . In the event of any merger, reorganization, consolidation, recapitalization, separation, liquidation, stock dividend, split-up, Share combination, or other change in the corporate structure of the Company affecting the Shares, the Committee shall adjust the Stock Awards subject to the Award, in such manner as the Committee (in its sole discretion) shall determine to be appropriate.

11. Plan Governs . This Agreement is subject to all the terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan will govern. Terms used in this Agreement that are not defined in this Agreement will have the meaning set forth in the Plan.

12. Committee Authority . The Committee will have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any portion of the Stock Award has vested). All actions taken and all interpretations and determinations made by the Committee in good faith will be final and binding upon the Employee, the Company and all other interested persons. No member of the Committee will be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.

13. No Modification of At-Will Status . The Employee understands and agrees that this Agreement does not impact in any way the right of the Company, or the Affiliate employing the Employee, as the case may be, to terminate or change the terms of the employment of the Employee at any time for any reason whatsoever, with or without good cause. The Employee understands and agrees that his or her employment is “at-will” and that either the Company or the Employee may terminate the Employee’s employment at any time and for any reason. The Employee also understands and agrees that his or her “at-will” status can only be changed by an express written contract signed by an authorized officer of the Company and the Employee.

14. Non-Transferability of Award . Except as otherwise herein provided, the Stock Awards herein granted and the rights and privileges conferred hereby will not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and will not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of such Stock Award, or of any right or privilege conferred hereby, contrary to the provisions hereof, or upon any attempted sale under any execution, attachment or similar process upon the rights and privileges conferred hereby, such Stock Award and the rights and privileges conferred hereby will immediately become null and void.

15. Binding Agreement . Subject to the limitation on the transferability of the Stock Award contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the Employee and the Company.

16. Addresses for Notices . Any notice to be given to the Company under the terms of this Agreement will be addressed to the Company, in care of its Legal Department, at The Gap, Inc., Two Folsom, San Francisco, California 94105, or at such other address as the Company may hereafter designate in writing. Any notice to be given to the Employee will be addressed to the Employee at the address set forth on the records of the Company. Any such notice will be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, and deposited, postage prepaid, in a United States post office.

17. Captions . Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

18. Agreement Severable . In the event that any provision in this Agreement will be held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of this Agreement.

19. Modifications to the Agreement . This Agreement constitutes the entire understanding of the parties on the subjects covered. The Employee expressly warrants that he or she is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement or the Plan can be made only in an express written agreement executed by a duly authorized officer of the Company.

20. Amendment, Suspension or Termination of the Plan . By accepting this Award, the Employee expressly warrants that he or she has received a right to an equity based award under the Plan, and has received, read, and understood a description of the Plan. The Employee understands that the Plan is discretionary in nature and may be modified, suspended, or terminated by the Company at any time.

Exhibit 10.3

Grant No.             

THE GAP, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

The Gap, Inc. (the “Company”) hereby grants to Paul S. Pressler (the “Employee”), a stock option under The Gap, Inc. 2006 Long-Term Incentive Plan (the “Plan”), to purchase shares of common stock of the Company, $0.05 par value (“Shares”). This option is subject to all of the terms and conditions contained in this Agreement, including the terms and conditions contained in the attached Appendix A. The date of this Agreement is                      . Subject to the provisions of Appendix A and of the Plan, the principal features of this option are as follows:

As provided in the Plan and in this Agreement, this option may terminate before the date written above, including before the option becomes exercisable or is exercised. For example, if Employee’s employment as Chief Executive Officer ends before the date this option becomes exercisable, this option will terminate at the same time as such termination. See paragraphs 5 and 6 of Appendix A for further information concerning how changes in employment affect termination of this option. PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS OF THIS OPTION.

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement, in duplicate, to be effective as of the date first above written.

My signature below indicates that I understand that this option is subject to all of the terms and conditions of this Agreement (including the attached Appendix A) and of the Plan.

APPENDIX A

TERMS AND CONDITIONS OF NON-QUALIFIED STOCK OPTION

1. Grant of Option . The Company hereby grants to Employee under the Plan, as a separate incentive in connection with his or her employment and not in lieu of any salary or other compensation for his or her services, a non-qualified stock option to purchase, on the terms and conditions set forth in this Agreement and the Plan, all or any part of the number of Shares set forth on page 1 of this Agreement. The option granted hereby is not intended to be an Incentive Stock Option within the meaning of Section 422 of the Code.

2. Exercise Price . The purchase price per Share (the “Option Price”) shall be equal to the price set forth on page 1 of this Agreement. The Option Price shall be payable in the legal tender of the United States.

3. Number of Shares . The number and class of Shares specified in paragraph 1 above, and/or the Option Price, are subject to appropriate adjustment in the event of changes in the capital stock of the Company by reason of stock dividends, split-ups or combinations of shares, reclassifications, mergers, consolidations, reorganizations or liquidations. Subject to any required action of the stockholders of the Company, if the Company shall be the surviving corporation in any merger or consolidation, the option granted hereunder (to the extent that it is still outstanding) shall pertain to and apply to the securities to which a holder of the same number of Shares that are then subject to the option would have been entitled. To the extent that the foregoing adjustments relate to stock or securities of the Company, such adjustments shall be made by the Compensation and Management Development Committee of the Company’s Board of Directors (the “Committee”), whose determination in that respect shall be final, binding and conclusive.

4. Commencement of Exercisability . Except as otherwise provided in this Agreement, the right to exercise the option awarded by this Agreement shall accrue as set forth on page 1 of this Agreement, assuming that Employee is still employed as the Chief Executive Officer of the Company or an Affiliate through such date(s). If Employee is not employed as the Chief Executive Officer on such date(s), the option shall terminate, as set out in paragraph 6.

5. Postponement of Exercisability . Notwithstanding paragraph 4 or any other provision of this Agreement, prior to the date this option is scheduled to become exercisable, the Committee, in its sole discretion, may determine that the right to exercise the option awarded by this Agreement shall accrue on a date later than such date. The Committee shall exercise its power to postpone the commencement of exercisability only if the Committee, in its sole discretion, determines that Employee has taken a personal leave of absence (as defined from time to time by the Committee) since the date of this Agreement. The duration of the period of postponement shall equal the duration of the personal leave of absence. If Employee does not return from the personal leave of absence, the option shall terminate as set out in paragraph 6.

6. Termination of Option . In the event that Employee’s employment as Chief Executive Officer of the Company or an Affiliate terminates for any reason other than Retirement (as defined in the Plan) or death, this option shall immediately thereupon terminate, except that Employee shall have three (3) months from such termination to exercise any unexercised portion of the option which is then exercisable. In the event of Employee’s Retirement, Employee may, within one (1) year after the date of such Retirement, or within ten (10) years from the date of this Agreement, whichever shall first occur, exercise any unexercised portion of the option (whether or not exercisable). In the event that Employee shall die while in the employ of the Company or an Affiliate, any unexercised portion of the option (whether or not exercisable) may be exercised by Employee’s beneficiary or transferee, as hereinafter provided, for a period of one (1) year after the date of Employee’s death or within ten (10) years from the date of this Agreement, whichever shall first occur. Notwithstanding the preceding two sentences, in the event that within one year of the date of this Agreement, Employee dies or terminates employment as Chief Executive Officer of the Company due to Retirement, this option shall immediately thereupon terminate.

7. Persons Eligible to Exercise . The option shall be exercisable during Employee’s lifetime only by Employee. The option shall be non-transferable by Employee other than by a beneficiary designation made in a form and manner acceptable to the Committee, or by will or the applicable laws of descent and distribution.

8. Death of Employee . To the extent exercisable after Employee’s death, the option shall be exercised only by Employee’s designated beneficiary or beneficiaries, or if no beneficiary survives Employee, by the person or persons entitled to the option under Employee’s will, or if Employee shall fail to make testamentary disposition of the option, his or her legal representative. Any transferee exercising the option must furnish the Company (a) written notice of his or her status as transferee, (b) evidence satisfactory to the Company to establish the validity of the transfer of the option and compliance with any laws or regulations pertaining to said transfer, and (c) written acceptance of the terms and conditions of the option as prescribed in this Agreement.

9. Exercise of Option . The option may be exercised by the person then entitled to do so as to any Shares which may then be purchased (a) by giving written notice of exercise to the Company, specifying the number of full Shares to be purchased and accompanied by full payment of the purchase price thereof (and the amount of any income tax the Company determines is required to be withheld by reason of such exercise), and (b) by giving satisfactory assurances in writing if requested by the Company, signed by the

person exercising the option, that the Shares to be purchased upon such exercise are being purchased for investment and not with a view to the distribution thereof.

10. No Rights of Stockholder . Neither Employee nor any person claiming under or through said Employee shall be or have any of the rights or privileges of a stockholder of the Company in respect of any of the Shares issuable upon the exercise of the option, unless and until certificates representing such Shares shall have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to Employee.

11. No Right to Continued Employment . Employee understands and agrees that this Agreement does not impact in any way the right of the Company, or the Affiliate employing Employee, as the case may be, to terminate or change the terms of the employment of Employee at any time for any reason whatsoever, with or without good cause. Employee understands and agrees that his or her employment is “at-will” and that either the Company or Employee may terminate Employee’s employment at any time and for any reason. Employee also understands and agrees that his or her “at-will” status can only be changed by an express written contract signed by an authorized officer of the Company and Employee.

12. Addresses for Notices . Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company, in care of its Legal Department, at The Gap, Inc., Two Folsom, San Francisco, California 94105, or at such other address as the Company may hereafter designate in writing. Any notice to be given to Employee shall be addressed to Employee at the address set forth beneath Employee’s signature hereto, or at such other address as Employee may hereafter designate in writing. Any such notice shall be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, registered or certified and deposited, postage and registry fee prepaid, in a United States post office.

13. Non-Transferability of Option . Except as otherwise herein provided, the option herein granted and the rights and privileges conferred hereby shall not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of said option, or of any right or privilege conferred hereby, contrary to the provisions hereof, or upon any attempted sale under any execution, attachment or similar process upon the rights and privileges conferred hereby, said option and the rights and privileges conferred hereby shall immediately become null and void.

14. Maximum Term of Option . Notwithstanding any other provision of this Agreement, this option is not exercisable after the expiration of ten (10) years from the date of this Agreement.

15. Binding Agreement . Subject to the limitation on the transferability of the option contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.

16. Plan Governs . This Agreement is subject to all terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan shall govern. Terms used and not defined in this Agreement shall have the meaning set forth in the Plan.

17. Committee Authority . The Committee shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon Employee, the Company and all other interested persons. No member of the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.

18. Captions . Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

19. Modifications to this Agreement . This Agreement constitutes the entire understanding of the parties on the subjects covered. Employee expressly warrants that he or she is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement or the Plan can be made only in an express written contract executed by a duly authorized officer of the Company.

20. Agreement Severable . In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

Exhibit 10.4

Award No.             

THE GAP, INC.

STOCK AWARD AGREEMENT ¹

The Gap, Inc. (the “Company”) hereby grants to                      (the “Employee”), an award (the “Award”) of Performance Units (each Performance Unit shall be referred to as a “Stock Award”) which represent the right to receive shares of the Company’s common stock, $0.05 par value (the “Shares”) subject to the fulfillment of the vesting conditions and other conditions set forth in the attached Appendix A. This Award is granted pursuant to The Gap, Inc. 2006 Long-Term Incentive Plan (the “Plan”) and is subject to all of the terms and conditions contained in this Stock Award Agreement (the “Agreement”), including the terms and conditions contained in the attached Appendix A. The date of this Agreement is                      . Subject to the provisions of Appendix A and of the Plan, the principal features of this Award are as follows:

As provided in the Plan and in this Agreement, this Award may terminate before the scheduled vest date(s) of the Stock Awards. For example, if Employee’s employment as Chief Executive Officer ends before the date this Award vests, this Award will terminate at the same time as such termination. Important additional information on vesting and forfeiture of the Stock Awards covered by this Award including those due to changes in employment is contained in paragraphs 3 through 5 of Appendix A.

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement, in duplicate, to be effective as of the date first above written.

My signature below indicates that I understand that this Award is 1) subject to all of the terms and conditions of this Agreement (including the attached Appendix A) and of the Plan, 2) not considered salary, nor is it a promise for future grants of Stock Awards, 3) not a term or condition of my employment with the Company, and 4) made at the sole discretion of the Company.

APPENDIX A

TERMS AND CONDITIONS OF STOCK AWARD

1. Grant of Stock Awards . The Company hereby grants to the Employee as a separate incentive in connection with his or her employment and not in lieu of any salary or other compensation for his or her services, an Award with respect to the number of Stock Awards set forth on page 1 of this Agreement, subject to all the terms and conditions in this Agreement and the Plan. Employee understands and agrees that this Award does not guarantee any future Stock Award grants and that grants are made at the sole discretion of the Company.

2. Company’s Obligation to Pay . On any date, a Stock Award has a value equal to the Fair Market Value of one Share. Unless and until a Stock Award has vested in accordance with the vesting schedule set forth on the first page of this Agreement, the Employee will have no right to payment of a Share with respect to the Stock Award. Prior to actual payment of any Shares pursuant to vested Stock Awards, each Stock Award represents an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company.

3. Vesting of Stock Awards and Issuance of Shares . Subject to paragraphs 4 and 5, the Stock Awards subject to this Agreement will vest as to the number of Stock Awards, and on the dates shown, on the first page of this Agreement (each a “Vesting Date”), but in each case, only if the Employee has been continuously employed as the Chief Executive Officer by the Company or by one of its Affiliates from the date of this Award until the applicable Vesting Date of the Stock Awards. If Employee is not employed as the Chief Executive Officer on such date(s), the Award shall terminate, as set forth in paragraph 5. Upon each Vesting Date, one Share shall be issued for each Stock Award that vests on such Vesting Date, subject to the terms and provisions of the Plan and this Agreement. No fractional Shares shall be issued under this Agreement.

4. Death or Retirement . In the event of the Employee’s death or Retirement (as defined in the Plan), the remaining Stock Awards shall become fully vested on the date of death or Retirement, as applicable. Notwithstanding the previous sentence, if in the event that within one year of the date of this Agreement, Employee dies or terminates employment due to Retirement, this Stock Award shall immediately thereupon terminate.

5. Termination of Service. Notwithstanding any contrary provision of this Agreement, the balance of the Stock Awards that have not vested pursuant to paragraph 3 or 4 will be forfeited and cancelled automatically at the time of the Employee’s Termination of Service as Chief Executive Officer.

6. Withholding Taxes . On each Vesting Date, the Employee agrees that the Company will withhold a portion of the Shares scheduled to be issued pursuant to vested Stock Awards that have an aggregate market value sufficient to pay the federal, state and local income, employment and any other applicable taxes required to be withheld by the Company or its designated Affiliate. The Company will only withhold whole Shares and therefore the Employee also authorizes deduction without notice from salary or other amounts payable to the Employee of cash in an amount sufficient to satisfy the Company’s remaining tax withholding obligation. Notwithstanding the previous two sentences, the Employee, if the Company in its sole discretion so agrees, may elect to furnish to the Company written notice, no more than 30 days and no less than 5 days in advance of a scheduled Vesting Date, of his or her intent to satisfy the tax withholding requirement by remitting the full amount of the tax withholding to the Company on the scheduled Vesting Date. In the event that Employee provides such written notice and fails to satisfy the tax withholding requirement by the Vesting date, the Company shall satisfy the tax withholding requirement pursuant to the first two sentences of this section.

7. Beneficiary Designation . Any distribution or delivery to be made to the Employee under this Agreement will, if the Employee is then deceased, be made to the Employee’s designated beneficiary, or if no such beneficiary survives the Employee, the person or persons entitled to such distribution or delivery under the Employee’s will or, if the Employee should fail to make testamentary disposition of such property, the executor of his or her estate. In order to be effective, a beneficiary designation must be made by the Employee in a form and manner acceptable to the Company. Any transferee must furnish the Company with (a) written notice of his or her status as transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.

8. Conditions to Issuance of Shares . The Shares deliverable to the Employee on the Vesting Date(s) may be either previously authorized but unissued Shares or issued Shares that have been reacquired by the Company. The Company shall not be required to issue any Shares hereunder so long as the Company

reasonably anticipates that such issuance will violate Federal securities law or other applicable law; provided however, that in such event the Company shall issue such Shares at the earliest possible date at which the Company reasonably anticipates that the issuance of the shares will not cause such violation. For purposes of the previous sentence, any issuance of Shares that would cause inclusion in gross income or the application of any penalty provision or other provision of the Internal Revenue Code shall not be treated as a violation of applicable law.

9. Rights as Stockholder . Neither the Employee nor any person claiming under or through the Employee will have any of the rights or privileges of a stockholder of the Company in respect of any Stock Award unless and until Shares have been issued in accordance with paragraph 3, recorded on the records of the Company or its transfer agents or registrars, and delivered to the Employee. Except as provided in paragraph 10, after such issuance, recordation, and delivery, the Employee will have all the rights of a stockholder of the Company with respect to voting such Shares and receipt of dividends and distributions on such Shares.

10. Changes in Stock . In the event of any merger, reorganization, consolidation, recapitalization, separation, liquidation, stock dividend, split-up, Share combination, or other change in the corporate structure of the Company affecting the Shares, the Committee shall adjust the Stock Awards subject to the Award, in such manner as the Committee (in its sole discretion) shall determine to be appropriate.

11. Plan Governs . This Agreement is subject to all the terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan will govern. Terms used in this Agreement that are not defined in this Agreement will have the meaning set forth in the Plan.

12. Committee Authority . The Committee will have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any portion of the Stock Award has vested). All actions taken and all interpretations and determinations made by the Committee in good faith will be final and binding upon the Employee, the Company and all other interested persons. No member of the Committee will be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.

13. No Modification of At-Will Status . The Employee understands and agrees that this Agreement does not impact in any way the right of the Company, or the Affiliate employing the Employee, as the case may be, to terminate or change the terms of the employment of the Employee at any time for any reason whatsoever, with or without good cause. The Employee understands and agrees that his or her employment is “at-will” and that either the Company or the Employee may terminate the Employee’s employment at any time and for any reason. The Employee also understands and agrees that his or her “at-will” status can only be changed by an express written contract signed by an authorized officer of the Company and the Employee.

14. Non-Transferability of Award . Except as otherwise herein provided, the Stock Awards herein granted and the rights and privileges conferred hereby will not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and will not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of such Stock Award, or of any right or privilege conferred hereby, contrary to the provisions hereof, or upon any attempted sale under any execution, attachment or similar process upon the rights and privileges conferred hereby, such Stock Award and the rights and privileges conferred hereby will immediately become null and void.

15. Binding Agreement . Subject to the limitation on the transferability of the Stock Award contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the Employee and the Company.

16. Addresses for Notices . Any notice to be given to the Company under the terms of this Agreement will be addressed to the Company, in care of its Legal Department, at The Gap, Inc., Two Folsom, San Francisco, California 94105, or at such other address as the Company may hereafter designate in writing. Any notice to be given to the Employee will be addressed to the Employee at the address set forth on the records of the Company. Any such notice will be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, and deposited, postage prepaid, in a United States post office.

17. Captions . Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

18. Agreement Severable . In the event that any provision in this Agreement will be held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of this Agreement.

19. Modifications to the Agreement . This Agreement constitutes the entire understanding of the parties on the subjects covered. The Employee expressly warrants that he or she is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement or the Plan can be made only in an express written agreement executed by a duly authorized officer of the Company.

20. Amendment, Suspension or Termination of the Plan . By accepting this Award, the Employee expressly warrants that he or she has received a right to an equity based award under the Plan, and has received, read, and understood a description of the Plan. The Employee understands that the Plan is discretionary in nature and may be modified, suspended, or terminated by the Company at any time.

Exhibit 10.5

Grant No.             

THE GAP, INC.

STOCK UNIT AGREEMENT

The Gap, Inc. (the “Company”) hereby grants to                      (the “Director”), the number of Stock Units under the Company’s 2006 Long-Term Incentive Plan (the “Plan”) indicated below. This award is subject to all of the terms and conditions contained in this Agreement, including the terms and conditions contained in the attached Appendix A. The date of this Agreement is                      . Subject to the provisions of Appendix A and of the Plan, the principal features of this award are as follows:

Your signature below indicates your agreement and understanding that this award is subject to all of the terms and conditions contained in Appendix A and the Plan. PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS OF THIS AWARD.

IN WITNESS WHEREOF, the Company and the Director have executed this Agreement, in duplicate, to be effective as of the day and year first above written.

My signature below indicates that I understand that this award is subject to all of the terms and conditions of this Agreement (including the attached Appendix A) and of the Plan.

APPENDIX A

TERMS AND CONDITIONS OF STOCK UNIT GRANT

1. Grant of Stock Units . The Company hereby grants to the Director under the Plan the number of Stock Units indicated on the first page of this Agreement subject to the terms and conditions set forth in this Agreement and the Plan.

2. Company’s Obligation to Pay . On any date, a Stock Unit has a value equal to the Fair Market Value of one Share. Unless and until the Stock Units have vested in accordance with the Vesting Schedule set forth on the first page of this Agreement, the Director will have no right to payment of the Stock Units. Prior to actual payment of any vested Stock Units, Stock Units represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company.

3. Payment .

(a) General Rule. Vested Stock Units will be paid to the Director in full Shares (with the balance, if any, in cash) as soon as practicable following the date which is three (3) years from the date of vesting, subject to paragraph 5.

(b) Election to Defer Payment. Notwithstanding paragraph 3(a), at the discretion of the Committee and in accordance with the Plan and such rules established by the Committee, the Director may elect to further defer delivery of the proceeds due with respect to his or her vested Stock Units by properly completing and submitting a Stock Unit Deferral Election Form (the “Election Form”) to the Company in accordance with the directions on the Election Form and the procedures established by the Committee.

(c) Termination of Service. Notwithstanding paragraphs 3(a) and 3(b), in the event that the Director incurs a Termination of Service for any reason, including, but not limited to, death, Disability, or Retirement, the vested Stock Units will be paid to the Director (or in the event of the Director’s death, to his or her estate) as soon as practicable following the date of such Termination of Service, subject to paragraph 5. Notwithstanding the foregoing, to the extent necessary to comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), any vested Stock Units that become payable as a result of the Director’s Termination of Service will be paid to the Director (or in the event of the Director’s death, to his or her estate) no earlier than six (6) months and one (1) day following the date of the Director’s Termination of Service, subject to paragraph 5.

4. Death of Director . Any distribution or delivery to be made to the Director under this Agreement will, if the Director is then deceased, be made to the Director’s designated beneficiary. If the Director has not designated a then living beneficiary, distributions and deliveries will be made to the administrator or executor of the Director’s estate. Any such administrator or executor must furnish the Company with (a) written notice of his or her status as transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.

5. Withholding of Taxes . The Director agrees that the Company will withhold a portion of the Shares scheduled to be issued pursuant to vested Stock Units that have an aggregate market value sufficient to pay the federal, state and local income, employment and any other applicable taxes required to be withheld by the Company or its designated Affiliate. The Company will only withhold whole Shares and therefore the Director also authorizes deduction without notice from amounts payable to the Director in cash in an amount sufficient to satisfy the Company’s remaining tax withholding obligation. Notwithstanding the previous two sentences, the Director, if the Company in its sole discretion so agrees, may elect to furnish to the Company written notice, no more than 30 days and no less than 5 days in advance of the date the vested Stock Units are scheduled to be paid (in accordance with Paragraph 3), of his or her intent to satisfy the tax withholding requirement by remitting the full amount of the tax withholding to the Company on this date. In the event that Director provides such written notice and fails to satisfy the tax withholding requirement by the date the vested Stock Units are scheduled to be paid (in accordance with Paragraph 3), the Company shall satisfy the tax withholding requirement pursuant to the first two sentences of this section.

6. Rights as Stockholder . Subject to Paragraph 7, neither the Director nor any person claiming under or through the Director will have any of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until certificates representing such Shares have been issued, recorded on

the records of the Company or its transfer agents or registrars, and delivered to the Director. After such issuance, recordation, and delivery, the Director will have all the rights of a stockholder of the Company with respect to such Shares.

7. Dividend Equivalents . The Director shall be entitled to receive Dividend Equivalents paid on Shares underlying the Stock Units. Any Dividends Equivalents automatically shall be deemed reinvested in Stock Units annually on each anniversary after the date of grant (the “Dividend Equivalent Stock Units”). Dividend Equivalent Stock Units shall be subject to the same terms and conditions as the Stock Units, including any deferral election.

8. No Effect on Service . The transactions contemplated hereunder and the vesting schedule set forth on the first page of this Agreement do not constitute an express or implied promise of continued service for any period of time. The terms of the Director’s service shall not be affected by the grant of this award.

9. Address for Notices . Any notice to be given to the Company under the terms of this Agreement must be addressed to the Company, in care of its Legal Department, at The Gap, Inc., Two Folsom, San Francisco, California 94105, or at such other address as the Company may hereafter designate in writing. Any notice to be given to the Director will be addressed to the Director at the address set forth on the records of the Company. Any such notice will be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, and deposited, postage prepaid, in a United States post office.

10. Grant is Not Transferable . Except as otherwise expressly provided herein, this grant, and the rights and privileges conferred hereby, may not be transferred, assigned, pledged, or hypothecated in any way (whether by operation of law or otherwise) and may not be subject to sale under execution, attachment, or similar process. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of this grant, or any right or privilege conferred hereby, or upon any attempted sale under any execution, attachment, or similar process, this grant and the rights and privileges conferred hereby immediately will become null and void.

11. Restrictions on Sale of Securities . The Shares issued as payment for vested Stock Units awarded under this Agreement shall be registered under the federal securities laws and shall be freely tradable upon receipt. However, the Director’s subsequent sale of the Shares shall be subject to any market blackout-period that may be imposed by the Company and must comply with the Company’s insider trading policies, and any other applicable securities laws.

12. Binding Agreement . Subject to the limitation on the transferability of this grant contained herein, this Agreement will be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors, and assigns of the Company and the Director.

13. Additional Conditions to Issuance of Certificates for Shares . The Shares deliverable to the Director may be either previously authorized but unissued Shares or issued Shares that have been reacquired by the Company. Solely for purposes of Delaware corporate law, par value for the Shares actually delivered to the Director for the Stock Units will be deemed satisfied by past services rendered by the Director. The Company shall not be required to issue any Shares hereunder so long as the Company reasonably anticipates that such issuance will violate Federal securities law or other applicable law; provided however, that in such event the Company shall issue such Shares at the earliest possible date at which the Company reasonably anticipates that the issuance of the Shares will not cause such violation. For purposes of the previous sentence, any issuance of Shares that would cause inclusion in gross income or the application of any penalty provision or other provision of the Code shall not be treated as a violation of applicable law.

14. Plan Governs . This Agreement is subject to all terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan will govern. Capitalized terms used and not defined in this Agreement will have the meaning set forth in the Plan.

15. Committee Authority . The Committee will have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation, and application of the Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any Stock Units have vested). All actions taken and all interpretations and determinations made by the Committee in good faith will be final and binding upon the Director, the Company, and all other interested persons. No member of the

Committee will be personally liable for any action, determination, or interpretation made in good faith with respect to the Plan or this Agreement.

16. Captions . Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

17. Agreement Severable . In the event that any provision in this Agreement will be held invalid or unenforceable, such provision will be severable from, and such invalidity or unenforceability will not be construed to have any effect on, the remaining provisions of this Agreement.

18. Modifications to the Agreement . This Agreement constitutes the entire understanding of the Company and the Director on the subjects covered, including the Director’s right to receive a grant of stock units under Section 9 of the Plan. The Director is not accepting this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement or the Plan can be made only in an express written agreement executed by a duly authorized officer of the Company. Notwithstanding anything to the contrary in the Plan or this Agreement, the Company reserves the right to revise this Agreement as it deems necessary or advisable, in its sole discretion and without the consent of the Director, to comply with Section 409A of the Code or to otherwise avoid imposition of any additional tax or income recognition under Section 409A of the Code in connection with these Stock Units (including settlement or payment thereof).

19. Amendment, Suspension or Termination of the Plan . By accepting this award, the Director expressly warrants that he or she has received a right to an equity based award under the Plan, and has received, read, and understood a description of the Plan. The Director understands that the Plan is discretionary in nature and may be modified, suspended, or terminated by the Company at any time.

20. Notice of Governing Law . This grant of Stock Units shall be governed by, and construed in accordance with, the laws of the State of California without regard to principles of conflict of laws.

***

THE GAP, INC.

2006 LONG-TERM INCENTIVE PLAN

STOCK UNIT DEFERRAL ELECTION FORM

Complete and return this Election Form if you want to defer the settlement (payment) of stock units granted to you under The Gap, Inc. 2006 Long-Term Incentive Plan (the “Plan”).

Stock units that are granted to you under the Plan (“Stock Units”) generally become payable as soon as practicable after the date which is three (3) years from the date of vesting (the “Original Payment Date”) in whole shares of common stock of The Gap, Inc. (the “Company”), with the balance, if any, in cash. Stock Units are immediately one hundred percent (100%) vested upon the Date of Grant. The Committee (as defined in the Plan) permits you to defer the settlement of your Stock Units beyond the Original Payment Date on a tax-deferred basis in accordance with the terms of the Plan. To achieve this favorable tax result, the amounts deferred will represent an unfunded and unsecured promise to pay on behalf of the Company. With respect to any amounts that you defer, you will become a general, unsecured creditor of the Company, which means that your deferral remains subject to the claims of the Company’s creditors, and, if the Company’s assets are insufficient to pay all of its creditors, you may not receive part or all of your deferral.

Please note that the Plan has been amended to comply with Section 409A of the Internal Revenue Code (“Section 409A”). As a result, any deferral elections made with respect to Stock Units must comply with the requirements of Section 409A. This means that deferral elections can be accepted and become effective only if the following requirements (the “Deferral Requirements”) are satisfied: (a) the deferral election must be made at least twelve (12) months before the Original Payment Date; (b) the deferral election must defer the payment of the Stock Units for a period of not less than five (5) years from the Original Payment Date; and (c) the deferral election may not take effect until at least twelve (12) months after the date on which the election is made.

I. PERSONAL INFORMATION

(Please Print)

Director Name:                                                       (the “Director”)

Social Security No.:                                                  

II. STOCK UNIT DEFERRAL ELECTION (Choose One)

OR

III. DESIGNATED PAYMENT DATE

Payment of the Stock Units indicated in Section II above will be made as soon as practicable following the date you choose below (the “Designated Payment Date”), provided that the Deferral Requirements are satisfied. This means that your Designated Payment Date will be given effect only if (a) you complete and return this Election Form at least twelve (12) months before the Original Payment Date, and (b) the Designated Payment Date is at least five (5) years from the Original Payment Date. As noted above, any payment will be made in the form of whole shares of Company common stock with the balance, if any, in cash.

Designated Payment Date:                     

(must be at least five (5) years from Original Payment Date of the Stock Units)

IMPORTANT: Please note that if the Original Payment Date is within twelve (12) months of the date you complete and return this Election Form, then due to Section 409A requirements, we cannot accept your deferral election and it will be deemed null and void. This means that payment of the Stock Units will be made as soon as practicable after the Original Payment Date regardless of your deferral election.

Any amounts deferred will be taxable as ordinary income in the year paid. Please seek advice from your professional tax advisor before making your deferral election.

IV. DIRECTOR SIGNATURE

I acknowledge that I have read and reviewed a copy of the Plan’s prospectus. I understand that my decision to defer the settlement of Stock Units will make me only a general, unsecured creditor of the Company. I also understand that the amounts deferred will be taxable as ordinary income in the year paid. If the Company determines that it is required to withhold for any taxes, including, but not limited to, income or employment taxes, prior to the date of deferred payout, I agree that, if I do not make other arrangements that are satisfactory to the Committee, in its sole discretion, the Company will withhold from the amounts due to me. I also understand that, upon receipt of deferred payouts, in addition to federal taxes, I may owe taxes both (1) to the state where I resided at the time of making this election and, if different, (2) to the state where I reside when I receive a deferred payout.

The Committee shall have the discretion to make all determinations and decisions regarding this deferral election. To the extent the Committee determines that this election does not comply with applicable laws, now or in the future, this election shall be null and void. In such an event, amounts deferred shall be settled (1) immediately if the Original Payment Date already has occurred, or (2) upon the Original Payment Date if in the future.

By signing this Election Form, I authorize implementation of the above instructions. I understand that the deferral elections that I have made on this Election Form are generally irrevocable and may not be changed in the future except in accordance with the requirements of Section 409A and the procedures specified by the Committee.

Agreed to and accepted:

2

Exhibit 10.6

Nonemployee Director Compensation

To become effective upon approval by the Company’s stockholders

of the amendment and restatement of the Company’s 1996 Stock Option and Award Plan

(thereafter known as the 2006 Long-Term Incentive Plan)

The Company’s Board of Directors (the “Board”) has made the following changes to its compensation arrangements for members of the Board who are not also employed by the Company, any of its subsidiaries, or any of its affiliated entities (a “Nonemployee Director”); provided, however, that these changes shall only become effective if and when the Company’s stockholders approve of the proposed amendment and restatement of the Company’s 1996 Stock Option and Award Plan (thereafter to be known as the 2006 Long-Term Incentive Plan (the “2006 Plan”)); and, provided further, that the Board retains its right to make further changes to this compensation arrangement from time-to-time in whole or in the case of individual Nonemployee Director participants:

1. Elimination of Current Arrangement . The Company will eliminate that component of its current compensation arrangement for Nonemployee Directors whereby Nonemployee Directors receive stock option grants covering 15,000 shares of the Company’s common stock upon their initial election to the Board and automatic annual stock option grants covering 7,500 shares on the first business day following each annual meeting of the stockholders of the Company.

2. New Nonemployee Directors . Each individual who first becomes a Nonemployee Director on or after the date of the Company’s 2006 annual meeting of stockholders shall be granted Stock Units under the Company’s 2006 Plan, with an initial value of $100,000, on the date that he or she first is appointed or elected to the Board; provide that if he or she first is elected to the Board at the Company’s annual meeting of stockholders, such grant shall be made on the first business day after such annual meeting of stockholders.

3. Continuing Nonemployee Directors . Each Nonemployee Director serving as such immediately prior to the Company’s 2006 annual meeting of stockholders shall be granted Stock Units under the 2006 Plan, with an initial value of $100,000, on the first business day after such annual meeting, provided he or she is a Nonemployee Director on that date. Thereafter, each Nonemployee Director shall be granted Stock Units under the 2006 Plan, with an initial value of $100,000, on the first business day after each subsequent annual meeting of stockholders of the Company, provided that he or she both (a) is a Nonemployee Director on that date, and (b) has continuously served as such since the preceding grant under Section 2 or 3, as the case may be.

4. Adjustments . Notwithstanding the foregoing, the Board, in its sole discretion, may change the numerical limits set forth in Sections 2 and 3 above.

5. Form and Timing of Payment . Unless otherwise determined by the Board, payment of Stock Units to Nonemployee Directors pursuant to this compensation arrangement

shall be paid in shares of the Company’s common stock, but shall be deferred until as soon as practicable after the date which is three (3) years from the date the Stock Units were granted, unless further deferred in each case at the election of the Nonemployee Director. Unless otherwise determined by the Board, Dividend Equivalents will accrue on outstanding Stock Units during the deferral period, will be reinvested in additional Stock Units annually, and will be paid in Shares of the Company’s common stock at the same time as payment is made upon the related Stock Units. Notwithstanding the foregoing, if a Nonemployee Director’s service on the Board terminates for any reason, including by reason of Disability (as defined in the 2006 Plan), payment of his or her accrued Stock Units and any related dividend equivalents shall be made as soon as practicable after the date of such termination of service. The Company shall not be required to issue any fractional shares of its common stock pursuant to this compensation arrangement, but shall satisfy such fractional shares in cash.

6. Other Compensation Arrangements Unchanged . Except as set forth herein, all other components of Nonemployee Director compensation remain unchanged.