**Exhibit 10(a)****THE GILLETTE COMPANY****1971 STOCK OPTION PLAN****(with amendments adopted through October2004)**
     1. PURPOSE.The purpose of the 1971 Stock Option Plan (hereinafter referred to as the “Plan”) is to provide a special incentive toselected key salaried employees of The Gillette Company (hereinafter referred to as the “Company”) and of its subsidiariesand to the non-employee members of the Board of Directors of the Company to promote the Company’s business. The Plan isdesigned to accomplish this purpose by offering such employees and non-employee directors a favorable opportunity to purchase sharesof the common stock of the Company so that they will share in the success of the Company’s business. For purposes of the Plan asubsidiary is any corporation in which the Company owns, directly or indirectly, stock possessing fifty percent or more of the totalcombined voting power of all classes of stock or over which the Company has effective operating control.
     2.ADMINISTRATION. The Plan shall be administered by the Compensation Committee heretofore established by the Board of Directorsof the Company, no member of which shall be an employee of the Company or of any subsidiary. The Committee shall have authority, notinconsistently with the Plan, (a) to determine which of the key salaried employees of the Company and its subsidiaries shall begranted options; (b) to determine whether the options granted to any employees shall be incentive stock options within the meaningof the Internal Revenue Code or non-qualified stock options or both; provided, however, that with respect to options granted afterDecember 31, 1986, in no event shall the fair market value of the stock (determined at the time of grant of the options) subject toincentive stock options within the meaning of the Internal Revenue Code which first became exercisable by any employee in anycalendar year exceed $100,000 (and, to the extent such fair market value exceeds $100,000, the later granted options shall betreated as non-qualified stock options); (c) to determine the time or times when options shall be granted to employees and thenumber of shares of common stock to be subject to each such option provided, however, subject to adjustment as provided in Section 9of the Plan, in no event shall any employee be granted options covering more than 1,250,000 shares of common stock in any calendaryear; (d) with respect to options granted to employees, to determine the option price of the shares subject to each option and themethod of payment of such price; (e) with respect to options granted to employees, to determine the time or times when each optionbecomes exercisable and the duration of the exercise period; (f) to prescribe the form or forms of the instruments evidencing anyoptions granted under the Plan and of any other instruments required under the Plan and to change such forms from time to time; (g)to make all determinations as to the terms of any sales of common stock of the Company to employees under Section 8 of the Plan; (h)to adopt, amend and rescind rules and regulations for the administration of the Plan and the options and for its own acts andproceedings; and (i) to decide all questions and settle all controversies and disputes which may arise in connection

with the Plan. All decisions, determinations andinterpretations of the Committee shall be binding on all parties concerned.
     3.PARTICIPANTS. The participants in the Plan shall be such key salaried employees of the Company or of any of its subsidiaries,whether or not also officers or directors, as may be selected from time to time by the Committee in its discretion, subject to theprovisions of Section 8 of the Plan. In addition, each non-employee director shall be a participant in the Plan. In any grant ofoptions after the initial grant, or any sale made under Section 8 of the Plan after the initial sale, employees who were previouslygranted options or sold shares under the Plan may be included or excluded.
     4.LIMITATIONS. No option shall be granted under the Plan and no sale shall be made under Section 8 of the Plan after April 21,2005, but options theretofore granted may extend beyond that date. Subject to adjustment as provided in Section 9 of the Plan, thenumber of shares of common stock of the Company, which may be delivered under the Plan, shall not exceed 198,800,000 in theaggregate. To the extent that any option granted under the Plan shall expire or terminate unexercised or for any reason becomeunexercisable as to any shares subject thereto, such shares shall thereafter be available for further grants under the Plan, withinthe limit specified above.
     5. STOCK TO BEDELIVERED. Stock to be delivered under the Plan may constitute an original issue of authorized stock or may consist ofpreviously issued stock acquired by the Company, as shall be determined by the Committee. The Committee and the proper officers ofthe Company shall take any appropriate action required for such delivery.
     6. TERMS ANDCONDITIONS OF OPTIONS GRANTED TO EMPLOYEES. All options granted to either non-employee directors or employees shall be subjectto Paragraphs (3) and (4) of Section 6(c) below. All options granted to employees under the Plan shall be subject to all thefollowing additional terms and conditions (except as provided in Sections 7 and 8 of the Plan) and to such other terms andconditions as the Committee shall determine to be appropriate to accomplish the purposes of the Plan:
     (a) Option Price. The option price under each option shall be determined by the Committee and shall be not lessthan l00 percent of the fair market value per share at the time the option is granted. If the Committee so directs, an option mayprovide that if an employee Participant who was an employee participant at the time of the grant of the option and who is not anofficer or director of the Company at the time of any exercise of the option, he shall not be required to make payment in cash orequivalent at that time for the shares acquired on such exercise, but may at his election pay the purchase price for such shares bymaking a payment in cash or equivalent of not less than five percent of such price and entering into an agreement, in a formprescribed by the Committee, providing for payment of the balance of such price, with interest at a specified rate, but not lessthan four percent, over a period not to exceed five years and containing such other provisions as the Committee in its discretiondetermines. In addition, if the Committee so directs, an option may provide for a guarantee by the Company of repayment of amountsborrowed by the Participant in order to exercise the option, provided he is not an officer or director of the Company at the time ofsuch borrowing, or may provide that
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the Company maymake a loan, guarantee, or otherwise provide assistance as the Committee deems appropriate to enable the Participant to exercise theoption, provided that no such loan, guarantee, or other assistance shall be made without approval of the Board of Directors asrequired by law.
     (b) Period of Options. The period of an option shall not exceed ten years from the date of grant.
     (c) Exercise of Option.
     (1) Each option held by a participant other than a non-employee director should be made exercisable at such time ortimes, whether or not in installments, as the Committee shall prescribe at the time the option is granted. In the case of an optionheld by a participant other than a non-employee director which is not immediately exercisable in full, the Committee may at any timeaccelerate the time at which all or any part of the option may be exercised.
     (2) Options intended to be incentive stock options, as defined in the Internal Revenue Code, shall contain and besubject to such provisions relating to the exercise and other matters as are required of incentive stock options under theapplicable provisions of the Internal Revenue Code and Treasury Regulations, as from time to time in effect, and the Secretary ofthe Committee shall inform optionees of such provisions.
     (3) Payment for Delivery of Shares. Upon exercise of any option, payment in full in the form of cash or a certifiedbank, or cashier’s check or, with the approval of the Secretary of the Committee, in whole or part Common stock of the Companyat fair market value, which for this purpose shall be the closing price on the business day preceding the date of exercise, shall bemade at the time of such exercise for all shares then being purchased thereunder, except in the case of an exercise to which theprovisions of the second sentence of Section 6(a) above are applicable.
     The purchase price payable by any person, other than a non-employee director, who is not a citizen or resident of theUnited States of America and who is an employee of a foreign subsidiary at the time payment is due shall, if the Committee sodirects, be paid to such subsidiary in the currency of the country in which such subsidiary is located, computed at such exchangerate as the Committee may direct. The amount of each such payment may, in the discretion of the Committee, be accounted for on thebooks of such subsidiary as a contribution to its capital by the Company. The Company shall not be obligated to deliver any sharesunless and until, in the opinion of the Company’s counsel, all applicable federal and state laws and regulations have beencomplied with, nor, in the event the outstanding common stock is at the time listed upon any stock exchange, unless and until theshares to be delivered have been listed or authorized to be added to the list upon official notice of issuance upon such exchange,nor unless or until all other legal matters in connection with the issuance and delivery of shares have been approved by theCompany’s counsel. Without limiting the generality of the foregoing, the Company may
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require from theParticipant such investment representation or such agreement, if any, as counsel for the Company may consider necessary in order tocomply with the Securities Act of 1933 and may require that the Participant agree that any sale of the shares will be made only onthe New York Stock Exchange or in such other manner as is permitted by the Committee and that he will notify the Company when hemakes any disposition of the shares whether by sale, gift, or otherwise. The Company shall use its best efforts to effect any suchcompliance and listing, and the Participant shall take any action reasonably requested by the Company in such connection. AParticipant shall have the rights of a shareholder only as to shares actually acquired by him under the Plan.
     (4)(a) Notwithstanding any other provision of this Plan, upon the occurrence of a Change of Control, as hereinafterdefined, all outstanding options held by employee Participants and non-employee directors which are not yet exercisable shall becomeimmediately exercisable and all the rights and benefits relating to such options including, but not limited to, periods during whichsuch options may be exercised shall become fixed and not subject to change or revocation by the Company except as otherwise providedunder Section 6(i).
     (b) In the event that, within two years of a Change of Control, the employment of an employee Participant is terminatedby the Company for any reason other than for Cause, or the employee Participant terminates employment for Good Reason, or theservice as a director of a non-employee director is terminated, the applicable exercise period for all options, other than optionsgranted prior to June 21, 2001 and designated as incentive stock options hereunder, then held by him shall be the greater of (i) aperiod of two years from the date of termination, and (ii) the post-termination exercise period otherwise applicable to the employeeParticipant under Section 6(f), or to the non-employee director under Section 12(d); provided, however, that in no event shall anyoption be exercisable beyond ten years from its date of grant.
     (c) A Change of Control shall mean the occurrence of any of the following events:
     (1) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of theSecurities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (withinthe meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (A) the then-outstanding shares of commonstock of the Company (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then-outstandingvoting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company VotingSecurities”); *provided*, *however*, that, for purposes of this Paragraph (1), the following acquisitions shall notconstitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, ( iii) anyacquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its subsidiaries or(iv) any acquisition by any corporation pursuant to a transaction that complies with clauses (A), (B) and (C) of Paragraph (3)below;
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     (2) Individuals who, as of December 16, 1999, constitute the Board of Directors (the “Board”) of the Company(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 bythe Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Boardshall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any suchindividual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to theelection or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Personother than the Board;
     (3) Consummation of a reorganization, merger, consolidation or sale or other disposition of all or substantially all ofthe assets of the Company (a “Business Combination”), in each case, unless, following such Business Combination, (A) allor substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and theOutstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, morethan 60% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securitiesentitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such BusinessCombination (including, without limitation, a corporation that, as a result of such transaction, owns the Company or all orsubstantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the sameproportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and theOutstanding Company Voting Securities, as the case may be, (B) no Person (excluding any corporation resulting from such BusinessCombination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such BusinessCombination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then-outstanding shares of common stock ofthe corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities ofsuch corporation, except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority ofthe members of the board of directors of the corporation resulting from such Business Combination were members of the IncumbentBoard at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination;or
     (4) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.
     (d) For the purposes of the Plan, unless otherwise provided under the terms of an employment agreement with the Companyor any of its subsidiaries, in which case the
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definitioncontained therein shall control, an employee Participant shall be treated as terminating his employment for “Good Reason”if he does so as a direct result of:
     (i)  the assignment to the Participant of any duties materially inconsistent in any respect with theParticipant’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities asin effect immediately prior to the Change of Control, or any other action by the Company or its subsidiaries that results in adiminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial andinadvertent action not taken in bad faith and that is promptly remedied by the Company and/or the subsidiary;
     (ii)  a decrease in the Participant’s compensation, other than an isolated, insubstantial and inadvertentfailure not occurring in bad faith and that is promptly remedied by the Company and/or the subsidiary; or
     (iii)  the Company’s or the subsidiary’s requiring the Participant to be based at any office orlocation other than (A) the office or where the Participant was based and performed services immediately prior to the Change ofControl or (B) any other location less than 35 miles from such office, or the Company’s or the subsidiary’s requiring theParticipant to travel on business to a substantially greater extent than required immediately prior to the Change of Control.
     (d) Nontransferability of Options.
     (1) Except as provided in Paragraphs (2) and (3) below, no option may be transferred by a Participant otherwise than bywill or the laws of descent and distribution, and during the Participant’s lifetime the option may be exercised only by him.
     (2) In the case of options other than (i) those options designated as incentive stock options or (ii) those optionsexcluded from the application of this Paragraph pursuant to a Schedule to this Plan, the Committee in its sole and exclusivediscretion may provide in the option agreement covering an option granted hereunder (either at the time of grant or, with theconsent of the Participant, at any time thereafter) that the Participant may transfer by gift all or any part of such option to (x)his spouse, child, grandchild or other “family member” (as such term is defined for purposes of applicable securities andtax laws), to a trust having only family members as beneficiaries or to a partnership or company having only family members aspartners or owners, or (y) a charitable organization described in Section 501(c)(3) of the Internal Revenue Code. Any options sotransferred shall remain subject to the otherwise applicable terms of the option agreement and this Plan, and also shall be subjectto such terms and conditions as the Committee may prescribe. Subsequent transfers of options shall be permitted under this Paragraphonly to the extent, and subject to the rules, prescribed by the Committee.
     (3) A Participant may transfer all or any part of an option granted hereunder to a former spouse pursuant to the termsof a qualified domestic relations order. Any options so
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 transferred shallremain subject to the otherwise applicable terms of the option agreement and this Plan. No subsequent transfers of options shall bepermitted under this Paragraph.
     (e) Nontransferability of Shares. If the Committee so determines, an option granted to an employee may providethat, without prior consent of the Committee, shares acquired by exercise of the option shall not be transferred, sold, pledged orotherwise disposed of within a period not to exceed one year from the date the shares are transferred to the Participant upon hisexercise of the option or prior to the satisfaction of all indebtedness with respect thereto, if later.
     (f) Termination of Employment. The provisions of this Subsection (f) shall govern in the event of the terminationof a Participant’s employment with the Company and its subsidiaries. If the employment of an employee Participant terminatesfor any reason other than his death, he may (unless discharged for Cause as hereinafter defined) thereafter exercise his option asprovided below:
     (i) If such termination of employment is voluntary on the part of the employee Participant, he may exercise his optiononly within 30 days after the date of termination of his employment (unless a longer period not in excess of three months is allowedby the Committee).
     (ii) If such termination of employment is involuntary on the part of the employee Participant, he may exercise hisoption only within three months after the date of termination of his employment.
     (iii) If such termination of employment is on account of the employee Participant’s total and permanent disability,he may exercise (I) any option granted prior to January 1, 2002 within the period ending one year after the date of termination ofhis employment, and (II) any option granted after December 31, 2001 within the period ending three years after the date oftermination of his employment.
     (iv) If such termination of employment is on account of the employee Participant’s retirement (as defined below),he may exercise (I) any option granted prior to January 1, 1994, other than an option designated as an incentive stock optionhereunder, within the period ending two years after his retirement date, (II) any option granted after December 31, 1993 and priorto April 17, 1997, other than an option designated an incentive stock option hereunder, within the period ending three years afterhis retirement date, (III) any option granted prior to April 17, 1997 and designated an incentive stock option hereunder within theperiod ending three months after his retirement date, (IV) any option granted after April 16, 1997 and prior to January 1, 2002within the period ending five years after his retirement date and (V) any option granted after December 31, 2001 over the remainingoption period, provided that an option described in clause (IV) or (V) which was designated at grant as an incentive stock optionshall cease to qualify as an incentive stock option under the Internal Revenue Code if not exercised
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within threemonths after his retirement date. For the purposes of his Plan, an employee Participant’s termination of employment is onaccount of “retirement” if either (A) at the time the Participant leaves the employ of the Company and its subsidiaries,the Participant qualifies for an early or normal retirement pension under the terms of a retirement plan maintained by or to whichthe Company or any subsidiary contributes for the benefit of the Participant, (B) the Participant leaves the employ of a subsidiarythat does not maintain or contribute to a retirement plan for the benefit of the Participant, and at such time the Participant wouldhave qualified for an early or normal retirement pension under the terms of The Gillette Company Retirement Plan had the individualbeen a participant of that plan, or (C) solely in the case of a Company-initiated termination of employment ( other than for Cause),at the time the Participant leaves the employ of the Company and its subsidiaries, the sum of Participant’s attained age andyears of service (each measured in full and partial years) totals at least 80. An employee Participant’s “retirementdate”, as used in this paragraph, means the first day the Participant is no longer on the active payroll of the Company or anysubsidiary following the Participant’s retirement.
     The Committee may, in its sole discretion, terminate any such option at or any time after the date of termination of theParticipant’s employment (and prior to the expiration of the exercise periods specified above), if it deems such action to bein the best interests of the Company. In no event may any Participant exercise any option that was not exercisable on the date heceased to be an employee, except (A) as to options granted prior to January 1, 2002, those options granted at least one year priorto Participant’s cessation of employment on account of retirement or total and permanent disability and (B) as to optionsgranted after December 31, 2001, if the Participant’s cessation of employment is on account of retirement or total andpermanent disability. In no event may any Participant exercise any option after the expiration of the option period. For thepurposes of this Subsection (f), a Participant’s employment shall not be considered terminated in the case of a sick leave orother bona fide leave of absence approved by the Company or a subsidiary in conformance with the applicable provisions of theInternal Revenue Code or Treasury Regulations, or in the case of a transfer to the employment of a subsidiary or to the employmentof the Company.
     If an employee Participant is discharged for Cause, as hereinafter defined, all his options shall immediately becancelled effective as of the date of termination of his employment. For the purposes of the Plan, unless otherwise provided underthe terms of an employment agreement with the Company or any of its subsidiaries, in which case the definition contained thereinshall control, a discharge for “Cause” shall have occurred where a Participant is terminated because of:
     (A) the Participant’s continued failure to perform substantially his duties with the Company or any of itssubsidiaries (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand forperformance is delivered to Participant by an officer or a senior manager of the Company or the
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subsidiary whichidentifies the manner in which the Board or the elected officer or manager believes that Participant has not performed his duties;
     (B) the Participant’s engaging in illegal conduct or gross misconduct which is materially and demonstrablyinjurious to the Company or the subsidiary; or
     (C) the Participant’s conviction of a felony or a plea of nolo contendere by Participant with respect thereto.
     (g) Death. In the event a Participant dies while holding options granted hereunder, (I) any option granted priorto January 1, 2002 may be exercised within a period not to exceed one year after the date of death, and (II) any option grantedafter December 31, 2001 may be exercised within a period not to exceed three years after the date of death, as to all or any of theshares covered by such option, by his executor or administrator of the person or persons to whom the option is transferred by willor the applicable laws of descent and distribution, and except as so exercised the option shall expire after the expiration of suchperiod. In no event, however, may any option be exercised after the expiration of the option period.
     (h) Deferral Election. In accordance with such rules and procedures as the Committee may prescribe from time totime, if provided by the Committee, in its sole and exclusive discretion, in the option agreement covering an option grantedhereunder, a Participant may elect to defer the delivery of the shares acquired upon the exercise of the option; provided that suchelection may not be made with respect to any incentive stock option or any option transferred pursuant to the provisions of Section6(d) above. The Participant’s deferral election must be made at least six months prior to the date such option is exercised orat such other time as the Committee may specify. Payment of the option exercise price must be made in the form of shares of commonstock which the Participant has held for at least six months. Deferral elections will be allowed only for option exercises thatoccur while the Participant is an active employee of the Company and its subsidiaries or is actively serving as a non-employeedirector, as the case may be. Any election to defer the delivery of the stock shall be irrevocable as long as the Participantremains an employee of the Company and its subsidiaries or a non-employee director, as the case may be.
     Upon the exercise of an option as to which a deferral election has been made in accordance with this Subsection (h), theCompany shall credit to a bookkeeping account a number of deferred stock units equal to the number of shares that otherwise wouldhave been delivered to the Participant. During the period of deferral, the deferred stock units shall accrue dividends at the ratepaid upon the Company’s common stock, which dividend equivalents shall be credited in the form of additional deferred stockunits. Deferred stock units shall be distributed in shares of common stock (with cash payment in lieu of any fractional share) uponthe Participant’s termination of employment with the Company and its subsidiaries or following the date the Participant’smembership on the Board of Directors ceases, as the case may be, or if the Participant’s termination is on account ofretirement, at such other date or dates as may be approved by the Committee over a period extending no later than 10 years followingsuch termination date.
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     The Committee may, in its sole discretion, allow for the early distribution of an employee Participant’s deferredstock units in the event of an immediate and heavy financial hardship or in the event of the death or disability of the Participant.Distribution on account of financial hardship shall be limited to the amount necessary to satisfy the hardship. In addition, theCommittee in its discretion may direct the distribution of an employee Participant’s deferred stock units if it believes suchaction is in the best interest of the Company. Deferred stock units shall not be assigned or alienated by any Participant, and shallnot be subject to attachment, garnishment, encumbrance, pledge or charge of any nature.
     (i) Additional Conditions of Option Awards. Unless otherwise provided pursuant to an employment agreement betweenan employee Participant and the Company, the following additional provisions shall govern options awarded under the Plan.
     (1) With respect to any option granted prior to June 21, 2001, and to any option granted on June 21, 2001 under TheGillette U.K. Approved Stock Option Plan (“2001 UK approved option”), the Committee may, in its sole discretion, cancelany such option at or any time after the date of termination of an employee Participant’s employment (and prior to theexpiration of the exercise periods specified above), if it deems such action to be in the best interests of the Company.
     (2) With respect to any option granted on or after June 21, 2001 (other than any 2001 UK approved option) (“coveredoption”), the following terms and conditions shall apply:
     (a) Unless otherwise provided pursuant to a termination settlement agreement with the Company or any of itssubsidiaries, while the Participant is employed by the Company and for a period of eighteen (18) months after the termination orcessation of such employment for any reason, the Participant shall not directly or indirectly:
     (i) as an employee, consultant, independent contractor, officer, director, individual proprietor, investor,partner, stockholder, agent, principal, joint venturer, or in any other capacity whatsoever (other than as the holder of not morethan one percent of the combined voting power of the outstanding stock of a publicly held corporation or company), be employed,work, consult, advise, assist, or engage in any activity regarding any business, product, service or other matter which: (A) issubstantially similar to or competes with any business, product, service or other matter regarding which the Participant worked forthe Company, or any of its subsidiaries, during the three (3) years prior to Participant’s termination of employment; or (B)concerns subject matters about which Participant gained proprietary information of the Company, or any of its subsidiaries, duringthe three (3) year period prior to the Participant’s termination of employment;
     (ii) either alone or in association with others, solicit, divert or take away, or attempt to divert or to takeaway, the business or patronage of any of the clients, customers or accounts, or prospective clients, customers or accounts, of the
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Company whichwere contacted, solicited or served, directly or indirectly, by Participant while employed by the Company; or
     (iii) either alone or in association with others: (A) solicit or encourage any employee or independent contractorof the Company to terminate his/her relationship with the Company; or (B) recruit, hire or solicit for employment or for engagementas an independent contractor, any person who is or was employed by the Company at any time during the Participant’s employmentwith the Company; provided, that this Paragraph (iii) shall not apply to such person whose employment with the Company has beenterminated for a period of six months or longer.
     (b) The Participant shall not disclose or use at any time any secret or confidential information or knowledge obtainedor acquired by the Participant during, after, or by reason of, employment with the Company or any of its subsidiaries, as providedunder applicable law and any and all agreements between the Participant and the Company or any of its subsidiaries regardingParticipant’s employment with the Company or the subsidiary.
     (c) In accordance with any and all agreements between the Participant and the Company or any of its subsidiariesregarding the Participant’s employment, the Participant shall disclose promptly and transfer and assign to the Company allimprovements and inventions in certain fields made or conceived by the Participant during employment with the Company or thesubsidiary and within the prescribed periods thereafter.
     (d) To the extent permitted by law, the Participant shall not make, publish or state, or cause to be made, published orstated, any defamatory or disparaging statement, writing or communication pertaining to the character, reputation, businesspractices, competence or conduct of the Company, its subsidiaries, shareholders, directors, officers, employees, agents,representatives or successors.
     (3) The geographic scope of the provisions of Paragraph (2)(a) above shall extend to anywhere the Company or any of itssubsidiaries is doing business, has done business or intends to do business.
     (4) If any restriction set forth in Paragraph (2)(a) above is found by any court of competent jurisdiction to beunenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographicarea, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which itmay be enforceable.
     (5) In the event of a Change of Control, the restrictions contained in Paragraphs (2)(a)(i), (2)(a)(iii) and (2)(d)above shall cease and the Participant shall no longer be bound by the obligations thereunder.
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     (6) If the Company reasonably determines that a Participant has materially violated any of the Participant’sobligations under Paragraph (2) above, or if a Participant is terminated for Cause, then, in addition to any other remedies at lawor in equity it may have, the Company shall have the following rights and remedies:
     (a) The Company may cancel any and all covered options granted to the Participant, including grants that according totheir terms are vested, effective as of the date on which such violation began (the “Violation Date”); and
     (b) The Company may demand the return of any gain realized by the Participant as a result of the Participant’sexercise of any covered option during the period commencing one year prior to the Participant’s termination of employment andcontinuing through the Violation Date. Upon demand, the Participant shall pay to the Company the amount of any gain realized orpayment received as a result of such exercises. At the option of the Company, such payment shall be made by returning to the Companythe number of shares of common stock of the Company which the Participant received in connection with such exercise (with theCompany then refunding the option price paid by the Participant), or in cash in the amount of the gain realized. If after suchdemand the Participant fails to return said shares or amounts, the Company shall have the right to offset said amounts against anyamounts, including compensation, owed to the Participant by the Company or to commence judicial proceedings against the Participantto recover said shares or amounts.
     (7) The non-competition restrictions set forth in Paragraph (2)(a) supersede any non-competition restrictions of lessthan eighteen (18) months in duration set forth in any agreement between a Participant and the Company or any subsidiary orpredecessor.
     7. REPLACEMENTOPTIONS. The Company may grant options under the Plan on terms differing from those provided for in Section 6 of the Plan wheresuch options are granted in substitution for options held by employees of other corporations who concurrently become employees ofthe Company or a subsidiary as the result of a merger or consolidation of the employing corporation with the Company or subsidiary,or the acquisition by the Company or a subsidiary of property or stock of the employing corporation. The Committee may direct thatthe substitute options be granted on such terms and conditions as the Committee considers appropriate in the circumstances.
     Notwithstandinganything contained in this Plan, the Committee shall have authority, with respect to any options granted or to be granted toemployees or outstanding installment Purchase Agreements of participants other than non-employee directors under this Plan, toextend the time for payment of any and all installments, to modify the amount of any installment, to amend outstanding optioncertificates to provide for installment payments or to take any other action which it may, in its discretion, deem necessary,provided that: (1) interest on the unpaid balance under any outstanding Purchase Agreement at the rate of at least four percent (4%)per annum shall continue to be due and payable quarterly during the period of any deferral of payment; (2) all such installmentPurchase Agreements and unexercised options, shall at all times be in accordance with the applicable
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provisions of Regulation G of the Board ofGovernors of the Federal Reserve System, as from time to time amended, and with all other applicable legal requirements; (3) no suchaction by the Committee shall jeopardize the status of stock options as incentive stock options under the Internal Revenue Code.
     8. FOREIGNEMPLOYEES. The Company may grant options under the Plan on terms differing from those provided for in Section 6 of the Planwhere such options are granted to employee Participants who are not citizens or residents of the United States of America if theCommittee determines that such different terms are appropriate in view of the circumstances of such Participants, provided, however,that such options shall not be inconsistent with the provisions of Section 6(a) or Section 6(b) of the Plan.
     In addition, if theCommittee determines that options are inappropriate for any key salaried employees who are not citizens or residents of the UnitedStates of America, whether because of the tax laws of the foreign countries in which such employees are residents or for otherreasons, the Board of Directors may authorize special arrangements for the sale of shares of common stock of the Company to suchemployees, whether by the Company, or a subsidiary, or other person. Such arrangements may, if approved by the Board of Directors,include the establishment of a trust by the foreign subsidiary, which is the employer of the key salaried employees, designated bysuch subsidiary, to whom the shares are to be sold. Such arrangements shall provide for a purchase price of not less than the fairmarket value of the stock at the date of sale and a maximum annual grant per participant of options to purchase 1,250,000 shares ofcommon stock and may provide that the purchase price be paid over a period of not more than ten years, with or without interest, andthat such employees have the right, with or without payment of a specified premium, to require the seller of the shares torepurchase such shares at the same price, subject to specified conditions. Such arrangements may also include provisions deemedappropriate as to acceleration or prepayment of the balance of the purchase price, restrictions on the transfer of the shares by theemployee, representations or agreements by the employee about his investment purposes and other miscellaneous matters.
     9. CHANGES INSTOCK. In the event of a stock dividend, split-up or combinations of shares, recapitalization or merger in which the Company isthe surviving corporation, or other similar capital change, the number and kind of shares of stock or securities of the Company tobe subject to the Plan and to options then outstanding or to be granted thereunder, the maximum number of shares or securities whichmay be issued or sold under the Plan, the maximum annual grant for each participant, the automatic annual grant for eachnon-employee director, the option price and other relevant provisions shall be appropriately adjusted by the Board of Directors ofthe Company, whose determination shall be binding on all persons. In the event of a consolidation or a merger in which the Companyis not the surviving corporation or which results in the acquisition of substantially all the Company’s outstanding stock by asingle person or entity or by a group of persons and/or entities acting in concert, or in the event of complete liquidation of theCompany, all outstanding options shall thereupon terminate, provided that (i) at least twenty days prior to the effective date ofany such consolidation or merger, the Board of Directors shall with respect to employee participants either (a) make all outstandingoptions immediately exercisable, or (b) arrange to have the surviving corporation grant replacement options to the employeeParticipants and (ii) in
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the case of option grants to non-employeedirectors, all outstanding options not otherwise exercisable shall become exercisable on the twentieth day prior to the effectivedate of the merger.
     10. EMPLOYMENTRIGHTS. The adoption of the Plan does not confer upon any employee of the Company or a subsidiary any right to continuedemployment with the Company or a subsidiary, as the case may be, nor does it interfere in any way with the right of the Company or asubsidiary to terminate the employment of any of its employees at any time.
     11. AMENDMENT OFPLAN OR OPTIONS. The Board of Directors of the Company, or the Compensation Committee of the Board of Directors if and to theextent authorized, may at any time or times amend the Plan or amend any outstanding option or options or arrangements establishedunder Section 8 of the Plan for the purpose of satisfying the requirements of any changes in applicable laws or regulations or forany other purpose which may at the time be permitted by law, provided that (except to the extent required or permitted under Section9 of the Plan and, with respect to clauses (b) and (f) below, except to the extent required or permitted under Section 7 of thePlan) no such amendment shall, without the approval of the stockholders of the Company, (a) increase the maximum number of sharesavailable under the Plan or the maximum annual grant per participant other than as permitted under Section 9 of the Plan, (b) reducethe minimum option price of options thereafter to be granted below the price provided for in Section 6(a) of the Plan, except thatthe Plan may be amended to provide that the minimum option price of non-qualified stock options thereafter to be granted toemployees may be not less than 95% of the fair market value at the date of grant if the Board determines that such amendment isnecessary for tax reasons to carry out the objectives of the Plan, (c) reduce the price at which shares of common stock of theCompany may be sold under Section 8 of the Plan below the price provided for in said Section 8, (d) reduce the option price ofoutstanding options, (e) extend the time within which options may be granted, or (f) extend the period of an outstanding optionbeyond ten years from the date of grant; and further provided no such amendment shall adversely affect the rights of any Participant(without his consent) under any option theretofore granted or other contractual arrangements theretofore entered into or after aChange of Control deprive any Participant of any right or benefit which became operative in the event of a Change of Control.
     12. TERMS ANDCONDITIONS OF OPTIONS GRANTED TO NON-EMPLOYEE DIRECTORS. Effective at the close of business on the second business day after the1992 Annual Meeting of Shareholders of the Company and on the second business day after each Annual Meeting thereafter, eachnon-employee director shall be automatically granted a non-incentive stock option to purchase 4,000 shares (5,000 shares for optionsgranted after 2001 and before 2004, and 7,500 shares for options granted after 2003) of the common stock of the Company under thegenerally applicable provisions of the Plan and upon the following specific terms and conditions:
     (a) Option Price. The option price under each option shall be the fair market value on the date of grant, whichfor this purpose is defined as the average between the high and the low price of the common stock as reported by the New York StockExchange.
     (b) Option Period. The period of an option shall be ten years from the date of grant.
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     (c) Option Exercisability. Each option granted prior to 2001 shall become exercisable in full on the earlier ofthe first Annual Meeting following the date of grant or the first anniversary of the date of grant, except as otherwise providedunder Paragraph (4) of Section 6(c) of the Plan. Each option granted after 2000 shall become exercisable ratably over a three yearperiod (for options granted after 2003, this means 2,500 after one year, an additional 2,500 after two years and the remaining 2,500after three years) on the earlier of the Annual Meeting or the anniversary of the date of grant in each such year, except asotherwise provided under Paragraph (4) of Section 6(c) of the Plan.
     (d) Exercise Period. Any option, otherwise exercisable, may be exercised during the period a non-employeedirector remains a member of the Board of Directors and for a period of three months following the date a non-employee directorceases to be a director; provided that, in the case where the non-employee director either has attained age 65 or has served as anon-employee director for at least five years when membership on the Board of Directors ends, all of that non-employeedirector’s options shall be exercisable for a period of two years with respect to options granted before 1994, three years foroptions granted after 1993 and before 2001, five years for options granted after 2000 and before 2002, and the remaining optionperiod for options granted after 2001, each such period commencing on the date membership on the Board of Directors ceases.
     If a non-employee director dies while a member of the Board of Directors, or following the date membership on the Boardof Directors ceases while an option remains exercisable in accordance with the preceding paragraph, then (I) for options grantedbefore 2002, at any time or times within one year after that non-employee director’s death, and (II) for options granted after2001, at any time or times within three years after that non-employee director’s death, that non-employee director’soption may be exercised in accordance with the provisions of Section 6(g) of the Plan. In no event shall any option be exercisedafter the expiration of the option period.
October 21, 2004
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