Gap (GPS)

PERFORMANCE SHARE AGREEMENT¹

The Gap, Inc. (the “Company”) hereby grants to                          (the “Employee”), an award (the “Award”) of Performance Shares, 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 performance and 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 Performance Share 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 Performance Shares. 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 Performance Shares covered by this Award including those due to changes in employment is contained in paragraphs 3 through 6 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 Performance Shares, 3) not a term or condition of my employment with the Company, and 4) made at the sole discretion of the Company.

PERFORMANCE SHARE AGREEMENT¹

The Gap, Inc. (the “Company”) hereby grants to                     (the “Employee”), an award (the “Award”) of Performance Shares, 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 performance and 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 Performance Share 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 Performance Shares. 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 Performance Shares 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.

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 Performance Shares, 3) not a term or condition of my employment with the Company, and 4) made at the sole discretion of the Company.