Document:

Exhibit 10.2

  

     The Gillette Company

2004
Long-Term Incentive Plan

 

  (Amended and Restated as of

  __________ __, 2005) 

[Revised __-2005]

Contents

	

	
Article 1. Establishment, Purpose, and Duration
        	 
        	
1
        
	
Article 2. Administration
        	 
        	
1
        
	
Article 3. Shares Subject to the Plan and Maximum Awards
        	 
        	
3
        
	
Article 4. Eligibility and Participation
        	 
        	
5
        
	
Article 5. Stock Options
        	 
        	
5
        
	
Article 6. Stock Appreciation Rights
        	 
        	
9
        
	
Article 7. Restricted Stock and Restricted Stock Units
        	 
        	
11
        
	
Article 8. Performance Shares
        	 
        	
13
        
	
Article 9. Cash-Based Awards and Other Stock-Based Awards
        	 
        	
14
        
	
Article 10. Performance Measures
        	 
        	
15
        
	
Article 11. Dividend Equivalents
        	 
        	
16
        
	
Article 12. Additional Conditions of Awards
        	 
        	
16
        
	
Article 13. Deferrals
        	 
        	
21
        
	
Article 14. Rights of Participants
        	 
        	
21
        
	
Article 15. Covered Transactions and Change of Control
        	 
        	
21
        
	
Article 16. Amendment, Modification, Suspension, and Termination
        	 
        	
23
        
	
Article 17. Withholding
        	 
        	
24
        
	
Article 18. Successors
        	 
        	
24
        
	
Article 19. General Provisions
        	 
        	
24
        
	
Article 19A. Special Merger Provisions
        	 
        	
27
        
	
Article 20. Definitions
        	 
        	
29
        

	

	
The Gillette Company
        	 
        	
[Revised __-2005]

The Gillette Company

2004 Long-Term Incentive Plan

Article 1. Establishment, Purpose, and Duration 

     1.1 Establishment. The Gillette Company, a Delaware corporation has established this 2004 Long-Term Incentive Plan (the “Plan”) as a long-term incentive
compensation plan. The Plan permits the grant of Cash-Based Awards, Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Shares, and Other Stock-Based Awards. The Plan
is effective as of May 20, 2004 (the “Effective Date”) and shall remain in effect as provided in Section 1.4 hereof.

     1.2 Assumption of the Plan. As of the Effective Time, The Procter & Gamble Company, an Ohio corporation, has assumed the Plan according to the Merger Agreement.
Unless otherwise specified, amendments to the Plan made in connection with the Merger Agreement shall be effective upon the Effective Time. Should the Merger not become effective, the Plan shall revert to the form approved by the shareholders of The
Gillette Company on May 20, 2004, without prejudice to any Awards then outstanding.

     1.3 Purpose of the Plan. The purpose of the Plan is to promote the interests of the Company and its stockholders by strengthening the Company’s ability to
attract, motivate, and retain Employees and, until the Effective Time, Nonemployee Directors of the Company upon whose judgment, initiative, and efforts the financial success and growth of
the business of the Company depend, and to provide an additional incentive for such individuals through stock ownership and other rights that promote and recognize the financial success and growth of the Company and create value for
stockholders.

     1.4 Duration of the Plan. Unless sooner terminated as provided herein, the Plan shall terminate ten years from the Effective Date. After the Plan is terminated, no
Awards may be granted but Awards previously granted shall remain outstanding in accordance with their applicable terms. No Incentive Stock Options may be granted more than ten years after December 9, 2003. 

Article 2. Administration

     2.1 General. The Committee shall be responsible for administering the Plan, subject to this Article 2 and the other provisions of the Plan. The Committee may employ
attorneys, consultants, accountants, agents, and other persons, any of whom may be an Employee, and shall be entitled to rely upon the advice, opinions, or valuations of any such persons. All actions taken and all interpretations and determinations
made by the Committee shall be final and binding upon the Participants, the Company, and all other interested persons.

     2.2 Authority of the Committee. The Committee shall have full discretionary power to interpret the terms and the intent of the Plan and any Award Agreement or other
agreement or document ancillary to or in connection with the Plan; to determine eligibility for Awards ; to adopt such rules, regulations, forms, instruments, and guidelines for administering the Plan, as it may deem necessary or proper. Such
authority shall include, but not be limited to, selecting Award recipients including prospective Employees and establishing all Award terms and conditions, including the 

	

	 The Gillette Company 	1 	 [Revised __-2005]

terms and conditions set forth in Award Agreements. In addition, for any grant following the Effective Time, the Committee shall have the further authority to: 

	 	
(a)             	
waive the provisions of Section 12.1A(a) hereof;       
	 
	 	
(b)             	
waive the provisions of Section 12.1A(b) hereof;       
	 
	 	
(c)             	
waive the provisions of Section 12.1A(c) hereof;       
	 
	 	
(d)             	
waive the provisions of Section 5.8(a), 5.8(b), and 5.8(c) hereof as well as Sections 6.7(a), 6.7(b), and 6.7(c) hereof and    
	 
	 	
(e)             	
impose conditions in lieu of those set forth in Articles 5, 6, 7, 8, and 9 for Options, SARs, Restricted Stock, RSUs, Performance Shares, or other Awards which do not increase or extend the rights of the Participant.       

Notwithstanding the foregoing, Awards to Nonemployee Directors shall be made by the Board, and all references in the Plan to the Committee, where the Committee is referred to as having discretion or authority to grant Awards,
shall, as applied to Awards made to Nonemployee Directors, be construed to refer to the Board. Awards to Nonemployee Directors are not subject to management’s discretion. 

     2.3 Composition. The Committee shall consist of not fewer than three (3) members of the Board who are "Non-Employee Directors" as defined in Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or any successor rule or definition adopted by the Securities and Exchange Commission, to be appointed by the Board from time to time and to serve at the discretion of the Board. The
Committee shall report to the Board on the administration of the Plan not less than once each year.

     The Committee may delegate to one or more of its members or to one or more officers of the Company, and/or its Subsidiaries or to one or more agents or advisors such administrative duties or powers as
it may deem advisable. The Committee may also delegate to one or more officers (each, a “delegated officer”) of the Company the power to designate Employees (other than the delegated officer and other than any officer subject to Section 16
of the Exchange Act) to receive Awards under the Plan, on such terms as the delegated officer determines, subject to the following: (i) any such delegation with respect to Options shall comply with the requirements set forth therein, and (ii) in the
case of any such delegation with respect to other Awards involving the issuance of Shares, the Committee shall authorize the issuance of the Shares, limiting the aggregate number thereof that shall be subject to Awards to which the delegation
applies, and shall determine the price, if any, to be paid therefor. Any officer to whom a delegation under the preceding sentence is made shall report periodically to the Committee, in such detail as the Committee may require, concerning Awards
allocated or granted pursuant to such delegation. References to the Committee herein shall be deemed to include any person to whom the Committee has delegated responsibilities under this Section 2.3, to the extent of such delegation. 

	

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Article 3. Shares Subject to the Plan and Maximum Awards

     3.1 Number of Shares Available for Awards.

	 	
(a)	
Subject to adjustment as provided in Section 3.4 hereof, the maximum number of Shares available for issuance to Participants under the Plan (the “Share
Authorization”) shall be:   
	 
	 	 	
(i)	
Nineteen million (19,000,000), plus    
	 
	 	 	
(ii)	
The sum of (1) the authorized Shares not issued or subject to outstanding awards under the Company’s Prior Plan as of the Effective Date plus (2) any unissued Shares subject to outstanding awards as of the Effective Date
under the Prior Plan that on or after the Effective Date cease for any reason to be subject to such awards (other than by reason of exercise or settlement of the awards to the extent they are exercised for or settled in vested and nonforfeitable
Shares). 
	 
	 	
(b)	
Subject to the foregoing limit on the number of Shares that may be issued in the aggregate under the Plan, the maximum number of Shares that may be issued in the following categories shall be as follows:    
	 
	 	 	
(i)	
No more than thirty seven million (37,000,000) Shares may be issued pursuant to Awards in the form of ISOs; and        
	 
	 	 	
(ii)	
No more than thirty seven million (37,000,000) Shares may be issued pursuant to Awards in the form of NQSOs; and       
	 
	 	 	
(iii)     	
No more than one million (1,000,000) Shares may be issued pursuant to Awards made to Nonemployee Directors.    

     3.2 Share
      Usage. 

	 	
(a)          	
Shares related to Awards that terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of such Shares, are settled in cash in lieu of Shares, or are exchanged with the Committee’s permission, prior
to the issuance of Shares, for Awards not involving Shares, are not issued Shares and, consistent with Section 3.1 above, shall be available for Awards granted under the Plan. If the Option Price of any Option granted under the Plan or the tax
withholding requirements with respect to any Award granted under the Plan are satisfied by tendering Shares to the Company (by either actual delivery or by attestation), or if shares are tendered for any other purpose under any other form of Award,
the number of Shares treated as issued under the Plan for purposes of Section 3.1 above shall be determined net of any Shares tendered to the Company. The Shares available for issuance under the Plan may be authorized and unissued Shares or treasury
Shares, or shares acquired in the open market as the Committee determines.       

	

	 The Gillette Company 	3	 [Revised __-2005]

 

	 	(b)   	The
        Committee shall have the authority to grant Awards as an alternative
        to or as the form of payment for grants or rights earned or due under
    other compensation plans or arrangements of the Company. 

     3.3 Annual Award Limits. The
    following limits (each an “Annual Award Limit,” and, collectively, “Annual Award Limits”)
shall apply to grants of Awards under the Plan:

	 	
(a)             	
Options: The maximum aggregate number of Shares subject to Options granted in any one Plan Year to any one Participant shall be three million (3,000,000) plus the amount of the Participant’s
unused applicable Annual Award Limit as of the close of the previous Plan Year.  
	 
	 	
(b)             	
SARs: The maximum number of Shares subject to Stock Appreciation Rights granted in any one Plan Year to any one Participant shall be three million (3,000,000) plus the amount of the
Participant’s unused applicable Annual Award Limit as of the close of the previous Plan Year.       
	 
	 	
(c)             	
Restricted Stock or Restricted Stock Units: The maximum aggregate grant with respect to Awards of Restricted Stock or Restricted Stock Units granted in any one Plan Year to any one Participant
shall be two million (2,000,000) plus the amount of the Participant’s unused applicable Annual Award Limit as of the close of the previous Plan Year.       
	 
	 	
(d)             	
Performance Shares: The maximum aggregate grant of Performance Shares in any one Plan Year to any one Participant shall be one and one-half million (1,500,000) Shares plus the amount of the
Participant’s unused applicable Annual Award Limit as of the close of the previous Plan Year.       
	 
	 	
(e)             	
Cash-Based Awards: The maximum aggregate grant amount with respect to Cash-Based Awards granted in any one Plan Year to any one Participant may not exceed ten million dollars ($10,000,000) plus the
amount of the Participant’s unused applicable Annual Award Limit as of the close of the previous Plan Year. 
	 
	 	
(f)             	
Other Stock-Based Awards. The maximum aggregate grant with respect to Other Stock-Based Awards granted in any one Plan Year to any one Participant shall be one and one-half million (1,500,000)
Shares plus the amount of the Participant’s unused applicable Annual Award Limit as of the close of the previous Plan Year. 
	 
	 	
(g)             	
Awards to Nonemployee Directors.
The maximum aggregate grant with respect to Awards made in any one Plan Year
to any one Nonemployee Director shall be twenty thousand (20,000) Shares plus
the  amount of the Participant’s unused applicable Annual Award Limit as
of the close of the previous Plan Year. Notwithstanding
any other provision to the contrary in this Plan, there shall be no Awards granted
to any Nonemployee Director after May 2005, provided
that the Merger closes according to the
terms and conditions of the Merger Agreement.  
	 	 	 

	

	 The Gillette Company 	4	 [Revised __-2005]

     3.4 Adjustments in Authorized Shares. In the event of any corporate event or transaction (including, but not limited to, a change in the shares of the Company or the
capitalization of the Company) such as a merger, consolidation, reorganization, recapitalization, separation, stock dividend, stock split, reverse stock split, split up, spin-off, or other distribution of stock or property of the Company,
combination of Shares, exchange of Shares, dividend in kind, or other like change in capital structure, or a distribution (other than a normal cash dividend) to stockholders of the Company, or any similar corporate event or transaction, the
Committee, in order to prevent dilution or enlargement of Participants’ rights under the Plan, shall substitute or adjust, as applicable, the number and kind of Shares that may be issued under the Plan or under particular forms of Award, the
number and kind of Shares subject to outstanding Awards, the Option Price or Grant Price applicable to outstanding Awards, the Annual Award Limits, and other value determinations applicable to outstanding Awards.

     The Committee may also make such other adjustments in Awards as are authorized by Article 15 or Article 16. Any adjustment made pursuant to this Section 3.4 or pursuant to Article 15 or Article 16
that is made with respect to an Award intended to be an ISO shall be made only to the extent consistent with such intent, and any such adjustment that is made with respect to an Award to a Covered Employee that is intended to qualify for the
performance-based compensation exception under Section 162(m) of the Code shall be made consistent with that intent. The determination of the Committee as to Award adjustments, if any, shall be conclusive and binding on Participants under the
Plan.

     3.5 Adjustments Resulting from the Merger. The Share Authorization, Annual Award Limits, and other Award limitations and maximums set forth in this Article 3 shall be
multiplied by the Exchange Ratio to establish an adjusted Share Authorization, Annual Award Limits, and other Award limitations and maximums following the Effective Time. 

Article 4. Eligibility and Participation

      4.1 Eligibility. Individuals eligible to participate in this Plan include all key Employees who, in the opinion of the Committee, have
demonstrated a capacity for contributing in a substantial manner to the success of the Company and/or its subsidiaries. Nonemployee Directors of the Company are also eligible for participation in the Plan until and
including May 2005, after which time no further grants shall be made to Nonemployee Directors, provided that the Merger closes according to the terms and conditions of the Merger
Agreement. 

     4.2 Actual Participation. Subject to the provisions of the Plan, the Committee may, from time to time, select from all eligible individuals those to whom Awards shall
be granted and the amount, type, and terms of each Award.

Article 5. Stock Options

     5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Participants in such number, and upon such terms, and at any time and
from time to time as shall be determined by the Committee; provided that ISOs may be granted only to eligible Employees of the Company or of any parent or subsidiary corporation (as these terms are defined in Section 424 of the Code and the
regulations thereunder).

	

	 The Gillette Company 	5 	 [Revised __-2005]

     5.2 Award Agreement. Each Option grant shall be evidenced by an Award Agreement that shall specify the Option Price, the maximum duration of the Option, the number of
Shares to which the Option pertains, the conditions upon which an Option shall become vested and exercisable, and such other provisions as the Committee shall determine that are not inconsistent with the terms of the Plan. The Award Agreement also
shall specify whether the Option is intended to be an ISO or a NQSO. 

     5.3 Option Price. The Option Price for each grant of an Option under this Plan shall be as determined by the Committee and shall be specified in the Award Agreement.
The Option Price shall be fixed and shall be equal to or greater than the FMV on the date of grant of the Shares subject to the Option. 

     5.4 Duration of Options. Each Option shall expire at such time as the Committee shall determine at the time of grant; provided, however, that no Option shall be
exercisable later than the tenth (10th) anniversary of the date of its grant.

     5.5 Exercise of Options. Options shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall in each instance approve,
which terms and restrictions need not be the same for each grant or for each Participant. 

     5.6 Payment. Options granted under this Article 5 shall be exercised by the delivery of a notice of exercise to the Company or an agent designated by the Company in a
form specified or accepted by the Committee, or by complying with any alternative procedures which may be authorized by the Committee, setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full
payment for the Shares. 

     The issuance of Shares with respect to any Option exercise shall be conditioned on full payment of the related Option Price. The Option Price of any Option shall be payable to the Company either: (a)
in cash or its equivalent; (b) by tendering (either by actual delivery or attestation) previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the Option Price (provided that, except as otherwise determined
by the Committee, the Shares that are tendered must have been held by the Participant for at least six (6) months prior to their tender to satisfy the Option Price or have been purchased on the open market); (c) by any other method approved or
accepted by the Committee, including, without limitation, if the Committee so determines, a cashless (broker assisted) exercise; or (d) by any combination of the foregoing. 

     Subject to any governing rules or regulations, as soon as practicable after receipt of written notification of exercise and full payment (including satisfaction of any applicable tax withholding), the
Company shall deliver to the person exercising the Option evidence of book entry Shares, or upon such person’s request, Share certificates in an appropriate amount based upon the number of Shares purchased under the Option(s). 

     Unless otherwise determined by the Committee, all cash payments under all of the methods indicated above shall be paid in United States dollars. 

     5.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant to the exercise of an Option granted under this
Article 5 as it may deem

	

	 The Gillette Company 	6 	 [Revised __-2005]

advisable, including, without limitation, minimum holding period requirements, restrictions under applicable securities laws, or under the requirements of any stock exchange or market upon which such Shares are then listed and/or
traded. 

     5.8 Termination of Employment.

Except as provided in Section 19A hereof and the Merger Agreement, in the event that a Participant ceases to be an employee of the Company or any of its subsidiaries while holding an unexercised Option:

	 	
(a)             	
Any unexercisable portions thereof are then void, except in the case of: (1) death of the Participant; (2) Retirement or Special Separation that occurs more than six months from the date the Options were granted; or (3) any
Option as to which the Committee has waived, at the time of grant, the provisions of this Section 5.8(a) hereof  
	 
	 	
(b)             	
Any exercisable portions thereof are then void, except in the case of: (1) death of the Participant which for Options granted prior to the Effective Time shall be exercised within the shorter of the term of the original
grant or three years from the date of death, and for Options granted after the Effective Time shall be exercised within the term of the original grant; (2) Retirement or Special Separation; (3) a voluntary resignation that is not for Good Reason,
but only with respect to Options granted prior to the Effective Time, which must be exercised (if at all) within 30 days after the date of termination of employment; or (4) any Option as to which the Committee has waived, at the time of grant, the
provisions of this Section 5.8(b)        
	 
	 	
(c)             	
In the case of Special Separation, any Option must be exercised within the term of the original grant or five (5) years from the date of Special Separation, whichever is shorter.     
	 
	 	
(d)             	
In the case of the death of a Participant, the persons to whom the Options granted following the Effective Time have been transferred by will or the laws of descent and distribution shall have the privilege of exercising remaining
Options or parts thereof, whether or not exercisable on the date of death of such Participant, at any time prior to the expiration date of the Options. Options granted before the Effective Time may be exercised during a period ending on the earlier
of the term of the original grant or three years from the date of death. 

     5.9 Transferability of Options.

	 	
(a)              	
Incentive Stock Options. No ISO granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and
distribution. Further, all ISOs granted to a Participant under this Article 5 shall be exercisable during his or her lifetime only by such Participant, or, in the event of the legal incompetence of the Participant,
by the Participant's duly appointed legal guardian.      
	 
	 	
(b)             	
Nonqualified Stock Options. Except as otherwise provided in a Participant’s Award Agreement or otherwise at any time by the Committee, no NQSO granted under this Article 5 may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of     

	

	 The Gillette Company 	7	 [Revised __-2005]

 

	 	 	descent and distribution; provided
        that the Board or Committee may permit further transferability, on a
        general or a specific basis, and may impose conditions and limitations
        on any permitted transferability. Further, except as otherwise provided
        in a Participant’s Award Agreement or otherwise at any time by the
        Committee, or unless the Board or Committee decides to permit further
        transferability, all NQSOs granted to a Participant under this Article
        5 shall be exercisable during his or her lifetime only by such Participant or,
        in the event of the legal incompetence of the Participant, by the Participant's
        duly appointed legal guardian. With
        respect to those NQSOs, if any, that are permitted to be transferred
        to another person, relevant references in the Plan to the Participant,
        as determined by the Committee, shall be deemed to include the Participant’s
    permitted transferee.  

     For the purpose of exercising any Options after
    the death of the Participant, the duly appointed executors and administrators
    of the estate of the deceased Participant shall have the same rights with
    respect to the Options as legatees or distributees would have after distribution
    to them from the Participant's estate. Notwithstanding the foregoing, the
    Committee may authorize the transfer of Options upon such terms and conditions
    as the Committee may require. Such transfer shall become effective only upon
    the Committee’s complete satisfaction that the proposed transferee has
    strictly complied with such terms and conditions, and both the original Participant
    and the transferee shall be subject to the same terms and conditions hereunder
as the original Participant. 

     5.10 Notification of Disqualifying Disposition. If any Participant shall make any disposition of Shares issued pursuant to the exercise of an ISO under the
circumstances described in Section 421(b) of the Code (relating to certain disqualifying dispositions), such Participant shall notify the Company of such disposition within ten (10) days thereof. 

     5.11. Substituting SARs. In the event the Company no longer uses APB Opinion 25 to account for equity compensation and is required to or elects to expense the cost of
Options pursuant to FAS 123 (or a successor standard), the Committee shall have the ability to substitute, without receiving Participant permission, SARs paid only in Stock (or SARs paid in Stock or cash at the Committee’s discretion) for
outstanding Options awarded after the adoption of FAS 123; provided, the terms of the substituted Stock SARs correspond in relevant respects to the terms of the Options and the difference between the Fair Market Value of the underlying Shares and
the Grant Price of the SARs is equivalent to the difference between the Fair Market Value of the underlying Shares and the Option Price of the Options, as determined by the Committee. 

     5.12 ISOs. The aggregate fair market value (determined at the time when the ISO is exercisable for the first time by a Participant during any calendar
year) of the shares for which any Participant may be granted ISOs under the Plan and all other stock option plans of the Company and its subsidiaries in any calendar year shall not exceed $100,000 (or such other amount as reflected in the limits
imposed by Section 422(d) of the Internal Revenue Code of 1986, as it may be amended from time to time). 

     5.13. Additional Terms and Conditions.

	 	
(a)             	
Unless otherwise authorized by the shareholders of the Company, neither the Board nor the Committee shall authorize the amendment of any Option to reduce the Option Price. This       

	

	 The Gillette Company 	8	 [Revised __-2005]

	 	 	
Paragraph shall not be construed to prohibit the adjustments permitted under Section 3.4 the Plan.     
	 
	 	
(b)             	
No Option shall be cancelled and replaced with awards having a lower Option Price without the prior approval of the shareholders of the Company. This Paragraph is intended to prohibit the repricing of “underwater”
Options and shall not be construed to prohibit the adjustments permitted under Section 3.4 the Plan.     
	 
	 	
(c)             	
The Committee may require any Participant to accept any Option by means of electronic signature.       
	 
	 	
(d)             	
No Options granted after the Effective Time shall be exercisable within one (1) year from their date of grant, except in the case of the death of the Participant.     

Article 6. Stock Appreciation Rights

     6.1 Grant of SARs. Subject to the terms and conditions of the Plan, SARs may be granted to Participants in such number, and upon such terms, and at any time and from
time to time as shall be determined by the Committee. The Committee may grant Freestanding SARs, Tandem SARs, or any combination of these forms of SARs.

     The Grant Price for each grant of a Freestanding SAR shall be determined by the Committee and shall be specified in the Award Agreement. The Grant Price for a Freestanding SAR shall be fixed and shall
be equal to or greater than the FMV on the date of grant of the Shares subject to the Freestanding SAR. The Grant Price of Tandem SARs shall be equal to the Option Price of the related Option. 

     6.2 SAR Agreement. Each SAR Award shall be evidenced by an Award Agreement that shall specify the Grant Price, the maximum duration of the SAR, the number of Shares to
which the SAR pertains, the conditions upon which a SAR shall become vested and exercisable, and such other provisions as the Committee shall determine that are not inconsistent with the terms of the Plan. 

     6.3 Duration of SAR. Each SAR shall expire at such time as the Committee shall determine at the time of grant; provided, however, that no SAR shall be exercisable
later than the tenth (10th) anniversary of the date of its grant.

     6.4 Exercise of Freestanding SARs. Freestanding SARs shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall in
each instance approve, which terms and restrictions need not be the same for each grant or for each Participant. 

     6.5 Exercise of Tandem SARs. Tandem SARs may be exercised for all or part of the Shares subject to the related Option upon the surrender of the right to exercise the
equivalent portion of the related Option. A Tandem SAR may be exercised only with respect to the Shares for which its related Option is then exercisable. 

     Notwithstanding any other provision of this Plan to the contrary, with respect to a Tandem SAR granted in connection with an ISO: (a) the Tandem SAR will expire no later than the expiration of

	

	 The Gillette Company 	9 	 [Revised __-2005]

the underlying ISO; (b) the value of the payout with respect to the Tandem SAR may be for no more than one hundred percent (100%) of the difference between the Option Price of the underlying ISO and the Fair Market Value of the
Shares subject to the underlying ISO at the time the Tandem SAR is exercised; and (c) the Tandem SAR may be exercised only when the Fair Market Value of the Shares subject to the ISO exceeds the Option Price of the ISO. 

     6.6 Payment of SAR Amount. Upon the exercise of an SAR, a Participant shall be entitled to receive payment from the Company in an amount determined by multiplying:

	 	
(a)             	
The difference between the Fair Market Value of a Share on the date of exercise over the Grant Price; by       
	 
	 	
(b)             	
The number of Shares with respect to which the SAR is exercised.       

     The payment upon SAR exercise may be in cash, Shares, or any combination thereof, or in any other manner approved by the Committee. The Committee’s determination regarding the form of SAR payout
shall be set forth in the Award Agreement pertaining to the grant of the SAR. 

      6.7 Termination of Employment. In the event that a Participant ceases to be an employee of the Company or any of its subsidiaries while holding an unexercised SAR:

	 	
(a)             	
Any unexercisable portions thereof are then void, except in the case of: (1) death of the Participant; (2) Retirement or Special Separation that occurs more than six months from the date the SARs were granted; or (3) any
SAR as to which the Committee has waived, at the time of grant, the provisions of this Section 6.7(a).   
	 
	 	
(b)             	
Any exercisable portions thereof are then void, except in the case of: (1) death of the Participant; (2) Retirement or Special Separation; or (3) any SAR as to which the Committee has waived, at the time of grant, the
provisions of this Section 6.7(b).       
	 
	 	
(c)             	
In the case of Special Separation, any SAR must be exercised within the term of the original grant or five (5) years from the date of Special Separation, whichever is shorter.        
	 
	 	
(d)             	
In the case of the death of a Participant, the persons to whom SARs have been transferred by will or the laws of descent and distribution shall have the privilege of exercising remaining stock appreciation rights or parts thereof,
whether or not exercisable on the date of death of such Participant, at any time prior to the expiration date of the SARs.       

      6.8 Nontransferability of SARs. Except as otherwise provided in a Participant’s Award Agreement or otherwise at any time by the Committee, no SAR granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Award Agreement or otherwise at any time by the
Committee, all SARs granted to a Participant under the Plan shall be exercisable during his or her lifetime only by such Participant or, in the event of the legal incompetence of the Participant, by the Participant's
duly appointed legal guardian. With respect to those SARs, if any, that are permitted to be transferred to another person, relevant references in the Plan to 

	

	 The Gillette Company 	10	 [Revised __-2005]

the Participant, as determined by the Committee, shall be deemed to include the Participant’s permitted transferee. 

      For the purpose of exercising SARs after the death of the Participant, the duly appointed executors and administrators of the estate of the deceased Participant
shall have the same rights with respect to the SARs as legatees or distributees would have after distribution to them from the Participant's estate. Notwithstanding the foregoing, the
Committee may authorize the transfer of SARs upon such terms and conditions as the Committee may require. Such transfer shall become effective only upon the Committee’s complete
satisfaction that the proposed transferee has strictly complied with such terms and conditions, and both the original Participant and the transferee shall be subject to the same terms and conditions hereunder as the original Participant. 

     6.9 Other Restrictions. The Committee shall impose such other conditions and/or restrictions on any Shares received upon exercise of a SAR granted pursuant to the Plan
as it may deem advisable or desirable. These restrictions may include, but shall not be limited to, a requirement that the Participant hold any Shares received upon exercise of a SAR for a specified period of time. 

     6.10. Additional Terms and Conditions.

	 	
(a)             	
Unless otherwise authorized by the shareholders of the Company, neither the Board nor the Committee shall authorize the amendment of any outstanding SAR to reduce the Grant Price. This Paragraph shall not be construed to prohibit
the adjustments permitted under Section 3.4 the Plan.    
	 
	 	
(b)             	
No SAR shall be cancelled and replaced with awards having a lower Grant Price without the prior approval of the shareholders of the Company. This Paragraph is intended to prohibit the repricing of “underwater” SARs and
shall not be construed to prohibit the adjustments permitted under Section 3.4 of the Plan.      
	 
	 	
(c)             	
The Committee may require any Participant to accept any SAR by means of electronic signature.  
	 
	 	
(d)             	
No SARs granted after the Effective Time shall be exercisable within one (1) year from their date of grant, except in the case of the death of the Participant.        

Article 7. Restricted Stock and Restricted Stock Units 

     7.1 Grant of Restricted Stock or Restricted Stock Units. Subject to the terms and provisions of the Plan, Shares of Restricted Stock and/or Restricted Stock Units may
be granted to Participants in such number, and upon such terms, and at any time and from time to time as shall be determined by the Committee.

     7.2 Restricted Stock or Restricted Stock Unit Agreement. Each Restricted Stock and/or Restricted Stock Unit grant shall be evidenced by an Award Agreement that shall
specify the Period(s) of Restriction, the number of Shares of Restricted Stock or the number of Restricted Stock Units granted, the conditions upon which Restricted Stock or Restricted Stock Units shall become 

	

	 The Gillette Company 	11	 [Revised __-2005]

vested, and such other provisions as the Committee shall determine that are not inconsistent with the terms of the Plan.

     7.3 Transferability. Except as provided in this Plan or an Award Agreement, the Shares of Restricted Stock and/or Restricted Stock Units granted herein may not be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end of the applicable Period of Restriction established by the Committee and specified in the Award Agreement or otherwise at anytime by the Committee (and in the
case of Restricted Stock Units until the date of delivery or other payment), or upon earlier satisfaction of any other conditions, as specified by the Committee, and set forth in the Award Agreement or otherwise at any time by the Committee. All
rights with respect to the Restricted Stock and/or Restricted Stock Units granted to a Participant under the Plan shall be available during his or her lifetime only to such Participant or, in the event of the legal
incompetence of the Participant, by the Participant's duly appointed legal guardian, except as otherwise provided in an Award Agreement or at any time by the Committee.

     7.4 Other Restrictions. The Committee shall impose such other conditions and/or restrictions on any Shares of Restricted Stock or Restricted Stock Units granted
pursuant to the Plan as it may deem advisable including, without limitation, a requirement that Participants pay a stipulated purchase price for each Share of Restricted Stock or each Restricted Stock Unit, restrictions based upon the achievement of
specific performance goals, time-based restrictions, and/or restrictions under applicable laws or under the requirements of any stock exchange or market upon which such Shares are listed or traded, or holding requirements or sale restrictions placed
on the Shares by the Company upon vesting of such Restricted Stock or Restricted Stock Units.

     Except with respect to a maximum of five percent (5%) of the Shares authorized in Section 3.1(a) and disregarding the impact of Article 15, any Awards of Restricted Stock or Restricted Stock Units
that vest on the basis of the Participant’s continued employment with or provision of service to the Company shall provide for vesting at a rate that is not more rapid than annual pro rata vesting over a three (3) year period and any Awards of
Restricted Stock or Restricted Stock Units that vest upon the attainment of performance goals shall provide for a performance period of at least twelve (12) months. 

     To the extent deemed appropriate by the Committee, the Company may retain the certificates representing Shares of Restricted Stock in the Company’s possession until such time as all conditions
and/or restrictions applicable to such Shares have been satisfied or lapse.

     After all conditions and restrictions under the Plan applicable to an Award under this Article 7 have been satisfied or have lapsed, including the satisfaction of all applicable tax withholding
obligations, then (a) if the Award was an Award of Restricted Stock, the Shares subject to the Award shall be free of all transfer restrictions imposed under the Plan, and (b) if the Award was an Award of Restricted Stock Units, the Shares subject
to the Award, or cash in lieu thereof, or a combination of Shares and cash, as the Committee determines, shall be issued and delivered to the holder of the Award. 

     7.5 Voting Rights. Except as otherwise specified in an Award Agreement, Participants holding Shares of Restricted Stock shall have full voting rights with respect to
those Shares during 

	

	 The Gillette Company 	12 	 [Revised __-2005]

the Period of Restriction. A Participant shall have no voting rights with respect to any Restricted Stock Units granted hereunder except as to Shares actually issued and delivered under such Units. 

     7.6 Termination of Employment. Each Award Agreement shall set forth the extent, if any, to which the Participant shall have the right to retain Restricted Stock and/or
Restricted Stock Units following termination of the Participant’s employment with or provision of services to the Company and/or its Subsidiaries, as the case may be. Such provisions shall be determined by the Committee, shall be included in
the Award Agreement entered into with each Participant, need not be uniform among all Shares of Restricted Stock or Restricted Stock Units issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination. 

     7.7 Section 83(b) Election. The Committee may provide in an Award Agreement relating to Restricted Stock
that the Award is conditioned upon the Participant making or refraining from making an election with respect to the Restricted Stock under Section 83(b) of the Code. If a Participant makes an election pursuant to Section 83(b) of the Code concerning
Restricted Stock, the Participant shall be required to file promptly a copy of such election with the Company.

Article 8. Performance Shares

     8.1 Grant of Performance Shares. Subject to the terms and provisions of the Plan, Performance Shares may be granted in such number, and upon such terms, which may
include requirements of continued service as well as performance conditions, and at any time and from time to time as shall be determined by the Committee. Each Award under this Article 8 shall specify the performance measures applicable to the
Award, as determined by the Committee, and the period or periods (each, a “Performance Period”) over which the performance measures so determined are to be measured. Each Performance Share shall be expressed in units of Shares or fractions
or multiples of Shares and shall provide for payout, if the applicable performance and other Award conditions are met, based on the value of the underlying Shares, or on appreciation in such value, or on such other Share-related measures of value as
the Committee may determine. For the avoidance of doubt, an Award granted under Articles 5, 6, 7 or 9 may provide for the acceleration of vesting or payment upon the satisfaction of performance conditions and shall not thereby be considered a
Performance Share Award under this Article 8, but a share based Award that would otherwise be described in Articles 5, 6, 7 or 9 but under which the satisfaction of performance conditions (other than service) is a precondition to any vesting or
exercisability shall be considered a Performance Share for purposes of the Plan.

     8.2 Payment of Performance Shares. Subject to the terms of this Plan, after the applicable Performance Period has ended, the holder of a Performance Share shall be
entitled to receive such payout, if any, as the Committee determines is owed based on the terms of the Award. Payment with respect to a Performance Share may be made in the form of cash or in Shares (or in a combination thereof), as the Committee
determines. 

     8.3 Termination of Employment. Each Award Agreement shall set forth the extent, if any, to which the Participant shall have the right to retain Performance Shares
following termination of the Participant’s employment with or provision of services to the Company and/or its Subsidiaries, as the case may be. Such provisions shall be determined by the Committee, shall be included in the Award Agreement
entered into with each Participant, need not be uniform among all Awards of 

	

	 The Gillette Company 	13	 [Revised __-2005]

Performance Shares issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination. 

      8.4 Nontransferability. Except as otherwise provided in a Participant’s Award Agreement or otherwise at any time by the Committee, Performance Shares may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Award Agreement or otherwise at any time by the Committee, a
Participant’s rights under the Plan shall be exercisable during his or her lifetime only by such Participant, or, in the event of the legal incompetence of the Participant, by the Participant's duly appointed
legal guardian. With respect to those Performance Shares, if any, that are permitted to be transferred to another person, relevant references in the Plan to a Participant, as determined by the Committee, shall be deemed to
include the Participant’s permitted transferee. 

Article 9. Cash-Based Awards and Other Stock-Based Awards 

     9.1 Grant of Cash-Based Awards. Subject to the terms and provisions of the Plan, Cash-Based Awards may be granted in such number, and upon such terms, and at any time
and from time to time as shall be determined by the Committee. Each such Award shall be evidenced by an Award Agreement that shall specify the maximum duration of the Cash-Based Award, the amount of cash to which the Cash-Based Award pertains, the
conditions upon which the Cash-Based Award shall become vested or exercisable, and such other provisions as the Committee shall determine which are not inconsistent with the terms of the Plan. 

     9.2 Other Stock-Based Awards. Subject to the terms and provisions of the Plan, Other Stock-Based Awards may be granted in such number, and upon such terms, and at any
time and from time to time as shall be determined by the Committee. Such Awards shall be evidenced by an Award Agreement that shall specify the maximum duration of the Other Stock-Based Award, the number of Shares to which the Other Stock-Based
Award pertains, the conditions upon which the Other Stock-Based Award shall become vested and exercisable, and such other provisions as the Committee shall determine which are not inconsistent with the terms of the Plan.

     9.3 Payment of Cash-Based and Other Stock-Based Awards. Each Cash-Based Award shall specify a cash-denominated payment amount or payment ranges as determined by the
Committee. Each Other Stock-Based Award shall be expressed in terms of Shares or units based on Shares, as determined by the Committee. Payment, if any, with respect to a Cash-Based Award or an Other Stock-Based Award shall be made in accordance
with the terms of the Award and, subject to such terms, may be made under either form of Award in cash or in Shares, as the Committee determines. 

     9.4 Termination of Employment. Each Participant’s Award Agreement shall set forth the extent, if any, to which the Participant shall have the right to receive
payment under Cash-Based Awards or Other Stock-Based Awards following termination of the Participant’s employment with or provision of services to the Company and/or its Subsidiaries, as the case may be. Such provisions shall be determined by
the Committee, shall be included in the Award Agreement entered into with each Participant, need not be uniform among all Cash-Based Awards or Other Stock-Based Awards issued pursuant to the Plan, and may reflect distinctions based on the reasons
for termination.

	

	 The Gillette Company 	14	 [Revised __-2005]

     9.5 Nontransferability. Except as otherwise determined by the Committee, neither Cash-Based Awards nor Other Stock-Based Awards may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided by the Committee, a Participant’s rights under the Plan, if exercisable, shall be exercisable
during his or her lifetime only by such Participant, or, in the event of the legal incompetence of the Participant, by the Participant's duly appointed legal guardian. With respect to those
Cash-Based Awards or Other Stock-Based Awards, if any, that are permitted to be transferred to another person, relevant references in the Plan to a Participant, as determined by the Committee, shall be deemed to include the Participant’s
permitted transferee. 

Article 10. Performance Measures

     10.1 Performance Measures. The performance goals upon which the payment or vesting of an Award to a Covered Employee that is intended to qualify as Performance-Based
Compensation shall be objectively determinable goals based upon one or more of the following Performance Measures: 

	 	
(a)             	
Net earnings or net income (before or after taxes);    
	 
	 	
(b)             	
Net income per share;  
	 
	 	
(c)             	
Net sales growth;      
	 
	 	
(d)             	
Net operating profit;  
	 
	 	
(e)             	
Return measures (including, but not limited to, return on invested capital, assets, equity, or net sales);     
	 
	 	
(f)             	
Cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital);       
	 
	 	
(g)             	
Income before or after taxes, interest, depreciation, and/or amortization;     
	 
	 	
(h)             	
Gross or operating margins;    
	 
	 	
(i)             	
Productivity ratios;   
	 
	 	
(j)             	
Share price (including, but not limited to, growth measures and total stockholder return);     
	 
	 	
(k)             	
Expense targets;       
	 
	 	
(l)             	
Margins;       
	 
	 	
(m)             	
Operating efficiency;  
	 
	 	
(n)             	
Working capital targets; and   
	 
	 	
(o)             	
Economic Value Added or EVA®(net
operating profit after taxes minus the sum of capital multiplied by the cost
of capital).     

     Performance Measures may be applied to any or any combination of the Company and its Subsidiaries on a consolidated basis or, as the context permits, on a divisional, entity, line of business, project
or geographical basis or in combinations thereof. If the Committee so determines, performance goals may relate to performance under one or more of the Performance Measures as hereinabove described compared to the performance of a group of comparator
companies or another index or indices. The Committee also has the authority to provide for accelerated vesting of any Award based on the achievement of performance goals pursuant to the Performance Measures specified in this Article 10.

     10.2 Evaluation of Performance. The Committee may provide in any such Award that any evaluation of performance may include or exclude any of the following events that
are objectively determinable and that occur during a Performance Period: (a) asset write-downs, (b) litigation, 

	

	 The Gillette Company 	15	 [Revised __-2005]

claims, judgments, or settlements, (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and restructuring programs, (e) extraordinary
nonrecurring items as described in Accounting Principles Board Opinion No. 30 and/or in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the
applicable year, (f) acquisitions, divestitures, joint ventures, or alliances, and (g) foreign exchange gains and losses. To the extent such inclusions or exclusions affect Awards to Covered Employees, they shall be prescribed in a form that meets
the requirements of Code Section 162(m) for deductibility. 

     10.3 Adjustment of Performance-Based Compensation. Awards that are designed to qualify as Performance-Based Compensation, and that are held by Covered Employees, may
not be adjusted upward. The Committee may adjust such Awards downward, either on a formula or a discretionary basis or any combination, as the Committee determines.

     10.4 Other Changes. In the event that applicable tax and/or securities laws change to permit Committee discretion to alter the governing Performance Measures without
obtaining stockholder approval of such changes, the Committee may make such changes without obtaining stockholder approval. In addition, in the event that the Committee determines that it is advisable to grant Awards that shall not qualify as
Performance-Based Compensation, the Committee may make such grants without satisfying the requirements of Code Section 162(m) and may base vesting on Performance Measures other than those set forth in Section 10.1. 

Article 11. Dividend Equivalents

     Any Participant selected by the Committee may be granted dividend equivalents based on the dividends declared on Shares that are subject to any Award but that have not been issued or delivered, to be
credited as of dividend payment dates during the period between the date the Award is granted and the date the Award is exercised, vests or expires, as determined by the Committee. Such dividend equivalents shall be converted to cash or additional
Shares by such formula and at such time and subject to such limitations as may be determined by the Committee. 

Article 12. Additional Conditions of Awards 

     Except as otherwise provided in the Merger Agreement or in any employment agreement (including any amendment thereto) entered between an Employee Participant and the Company before January 28, 2005,
the following additional provisions shall govern Awards granted under the Plan. 

12.1A Additional Conditions of Awards Granted in or after May 2005.

     With respect to any Awards granted in or after May 2005, in addition to such other conditions as may be established by the Committee, in consideration of the granting of any Award under the terms of
the Plan, including, without limitation, any Option, SAR, RSU, or grant of Shares, each Participant agrees as follows: 

	 	
(a)             	
The right to exercise any Award shall be conditional upon certification by the Participant at time of exercise that the Participant intends to remain in the employ of the Company or one of its subsidiaries for at least one (1)
year following the date of the exercise of the   
	 

	

	 The Gillette Company 	16	 [Revised __-2005]

	 	
Award (provided that termination of employment due to Retirement or Special Separation shall not constitute a breach of such certification).   
	 
	 	
(b)             	
In order to better protect the goodwill of the Company and its subsidiaries and to prevent the disclosure of the Company's or its subsidiaries' trade secrets and confidential information and thereby help insure the long-term
success of the business, the Participant, without prior written consent of the Company, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, consultant or otherwise, for a period of
three (3) years following the date of the Participant's termination of employment with the Company for any reason, in connection with the manufacture, development, advertising, promotion, or sale of any product which is the same as or similar to or
competitive with:        
	 
	 	 	
(i)             	
any business of The Gillette Company or its subsidiaries immediately prior to the Effective Time (including as relates to both existing products as well as products known to the Participant, as a consequence of the Participant's
employment with The Gillette Company or its subsidiaries, to be in development); or      
	 
	 	 	
(ii)            	
any business of The Procter & Gamble Company or its subsidiaries in which the Participant was employed following the Effective Time (including as relates to both existing products as well as products known to the Participant,
as a consequence of the Participant's employment with The Procter & Gamble Company or one of its subsidiaries, to be in development),        
	 
	 	 	
     with respect to which, in either case, the Participant's work has been directly involved at any time during the two (2) years preceding termination of employment or with respect to which during that period of time the Participant
acquired knowledge of trade secrets or other confidential information of The Gillette Company, The Procter & Gamble Company, and/or any of their subsidiaries as a result of Participant's job performance and duties.       
	 
	 	 	
For purposes of this paragraph, it shall be conclusively presumed that Participants have knowledge of information they were directly exposed to through actual receipt or review of memos or documents containing such information, or
through actual attendance at meetings at which such information was discussed or disclosed.      
	 
	           	(c)	 Following the Effective Time, unless otherwise
        provided pursuant to a termination settlement agreement with the Company
        or any of its subsidiaries, while the Participant is employed by the
        Company and for a period of eighteen (18) months after the termination
        or cessation of such employment for any reason , the Participant shall
        not directly or indirectly, either alone or in association with others:
        (i) solicit or encourage any employee or independent contractor of the
        Company to terminate his or her relationship with the Company; or (ii)
        recruit, hire or solicit for employment or for engagement as an independent
        contractor, any person who is or was employed by the Company at any time
        during the Participant’s employment with the Company; provided,
    that this Paragraph (c) 

	

	 The Gillette Company 	17	 [Revised __-2005]

	 	 	
shall not apply to such person whose employment with the Company has been terminated for a period of six months or longer.     
	 
	 	
(d)             	
The Participant agrees not to use or disclose the Company's or its subsidiaries' trade secrets and confidential information known to the Participant until any particular trade secret or confidential information become generally
known (through no fault of the Participant), whereupon the restriction on use and disclosure shall cease as to that item.        
	 
	 	 	
Information regarding products in development, in test marketing or being marketed or promoted in a discrete geographic region, which information the Company or one of its subsidiaries is considering for broader use, shall not be
deemed generally known until such broader use is actually commercially implemented. As used in this Section, “generally known” means known throughout the domestic U. S. industry or, in the case of Participants who have job responsibilities
outside of the United States, the appropriate foreign country or countries' industry. Without limiting the generality of the foregoing, Participant shall not:   
	 
	 	 	
(i)             	
Disclose or use at any time any secret or confidential information or knowledge obtained or acquired by the Participant during, after, or by reason of, employment with The Gillette Company or any of its subsidiaries, as provided
under applicable law and any and all agreements between the Participant and The Gillette Company or any of its subsidiaries regarding Participant’s employment with The Gillette Company or the subsidiary; and     
	 
	 	 	
(ii)            	
Disclose or use at any time any secret or confidential information or knowledge obtained or acquired by the Participant during, after, or by reason of, employment with The Procter & Gamble Company or any of its subsidiaries,
as provided under applicable law and any and all agreements between the Participant and The Procter & Gamble Company or any of its subsidiaries regarding Participant’s employment with The Procter & Gamble Company or the
subsidiary.      
	 
	 	
(e)             	
Following the Effective Time, to the extent permitted by law, the Participant shall not make, publish or state, or cause to be made, published or stated, any defamatory or disparaging statement, writing or communication pertaining
to the character, reputation, business practices, competence or conduct of the Company, its subsidiaries, stockholders, directors, officers, employees, agents, representatives or successors.   
	 
	 	
(f)             	
In accordance with any and all agreements between the Participant and the Company or any of its subsidiaries regarding the Participant’s employment, the Participant shall disclose promptly and transfer and assign to the
Company all improvements and inventions in certain fields made or conceived by the Participant during employment with the Company or its subsidiaries and within the prescribed periods thereafter.      
	 

	 	
(g)             	
By acceptance of any offered Option, SAR, RSU, grant of Shares, or any other Award granted under the terms of the Plan, the Participant acknowledges that if the Participant were, without authority, to use, disclose, or threaten
the use or disclosure of the trade secrets or confidential information of The Gillette Company or its subsidiaries or, following the Effective Time, of The Procter & Gamble Company or its subsidiaries, the        

	

	 The Gillette Company 	18	 [Revised __-2005]

	 	 	Company or one of its subsidiaries
                    would be entitled to injunctive and other appropriate relief
                    to prevent the Participant from doing so. The Participant
                    acknowledges that the harm caused to the Company by the breach
                    or anticipated breach of this Article is by its nature irreparable
                    because, among other things, it is not readily susceptible
                    of proof as to the monetary harm that would ensue. The Participant
                    consents that any interim or final equitable relief entered
                    by a court of competent jurisdiction shall, at the request
                    of the Company or one of its subsidiaries, be entered on
                    consent and enforced by any court having jurisdiction over
                    the Participant, without prejudice to any rights either party
                    may have to appeal from the proceedings which resulted in
          any grant of such relief. 

12.1B Additional Conditions of Awards Granted Before May 2005.

With respect to any Awards granted before May 2005, in addition to such other conditions as may be established by the Committee, in consideration of the granting of any Award under the terms of the Plan, including, without
limitation, any Option, SAR, RSU, or grant of Shares, each Participant agrees as follows: 

	 	
(a)             	
Unless otherwise provided pursuant to a termination settlement agreement with the Company or any of its subsidiaries, while the Participant is employed by the Company and for a period of eighteen (18) months after the termination
or cessation 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
more than 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) is substantially similar to or competes with any business, product, service or other matter regarding which the Participant worked for the 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, during the 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 take away, the business or patronage of any of the clients, customers or accounts, or prospective clients, customers or accounts,
of the Company which were 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 contractor of the Company to terminate his or her relationship with the Company; or (B) recruit, hire or solicit for employment or
for engagement as an independent contractor, any person who is or was employed by the Company at any time during the Participant’s employment with the Company; provided, that      
	 

	

	 The Gillette Company 	19	 [Revised __-2005]

 

	 	 	 	this Paragraph (iii) shall not
        apply to such person whose employment with the Company has been terminated
    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 obtained or acquired by the Participant during, after, or by reason of, employment with the Company or any of its
subsidiaries, as provided under applicable law and any and all agreements between the Participant and the Company or any of its subsidiaries regarding Participant’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 subsidiaries regarding the Participant’s employment, the Participant shall disclose promptly and transfer and assign to the
Company all improvements and inventions in certain fields made or conceived by the Participant during employment with the Company or the subsidiary 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 or stated, any defamatory or disparaging statement, writing or communication pertaining to the character, reputation,
business practices, competence or conduct of the Company, its subsidiaries, stockholders, directors, officers, employees, agents, representatives or successors. 

     12.2 Scope of Provisions. If any of the provisions contained in Section 12.1A and 12.1B hereof shall for any
reason, whether by application of existing law or law which may develop after the Participant's acceptance of an offer of the granting of an Award, be determined by a court of competent jurisdiction to be overly broad as to scope of activity,
duration, or territory, the Participant agrees to join the Company or any of its subsidiaries in requesting such court to construe such provision by limiting or reducing it so as to be enforceable to the extent compatible with then applicable law.
If any one or more of the terms, provisions, covenants, or restrictions of this Article shall be determined by a court of competent jurisdiction to be invalid, void or unenforceable, then the remainder of the terms, provisions, covenants, and
restrictions of this Article shall remain in full force and effect and shall in no way be affected, impaired, or invalidated. 

     12.3 Effect of Change of Control on Conditions. In the event of a Change of Control, the restrictions contained in Sections 12.1B (a)(i), 12.1B(a)(iii) and 12.1B(d)
hereof shall cease and the Participant
shall no longer be bound by the obligations thereunder. However, the provisions
of Section 12.1A hereof shall continue in full force and effect notwithstanding
a Change of Control. 

     12.4 Consequences of Violation of Conditions. If the Company reasonably determines that a Participant has materially violated any of the Participant’s obligations
under Section 12.1A or Section 12.1B above, or if a Participant is terminated for Cause, then, in addition to any other remedies provided in this Plan and available at law or in equity (including, without limitation, injunctive and other appropriate relief), the Company may cancel any and all Awards granted to the Participant, including grants that according to their terms are vested.

	

	 The Gillette Company 	20 	 [Revised __-2005]

     12.5 Effect on Other Non-Competition Restrictions. The non-competition restrictions set forth in Section 12.1B(a) supersede any non-competition restrictions of less
than eighteen (18) months in duration set forth in any employment agreement between a Participant and the Company or any subsidiary or predecessor. 

Article 13. Deferrals

     The Committee may permit or require a Participant to defer such Participant’s receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant by virtue of
the exercise of an Option or SAR, the lapse or waiver of restrictions with respect to Restricted Stock Units, or payment in respect of Performance Shares, Cash-Based Awards, and Other Stock-Based Awards. If any such deferral election is required or
permitted, the Committee shall establish rules and procedures for such payment deferrals. 

Article 14. Rights of Participants

     14.1 Employment. Nothing in the Plan or an Award Agreement shall interfere with or limit in any way the right of the Company and/or its Subsidiaries to terminate any
Participant’s employment or service on the Board at any time or for any reason or confer upon any Participant any right to continue his or her employment or service as a Nonemployee Director for any specified period of time.

     Neither an Award nor any benefits arising under this Plan shall constitute an employment contract with the Company and/or its Subsidiaries. Subject to Articles 2 and 16, this Plan and the benefits
hereunder may be terminated at any time pursuant to Article 16 without giving rise to any liability on the part of the Company and/or its Subsidiaries.

     14.2 Participation. No individual shall have the right to be selected to receive an Award under this Plan, or, having been so selected, to be selected to receive a
future Award. 

     14.3 Rights as a Stockholder. Except as otherwise provided herein, a Participant shall have none of the rights of a stockholder with respect to Shares covered by any
Award until the Participant becomes the record holder of such Shares. 

Article 15. Covered Transactions and Change of Control 

     15.1 Covered Transactions. Unless otherwise specified in an Award Agreement, in the event of a “covered transaction” (as hereinafter defined) in which there
is an acquiring or surviving entity, the Committee may provide for the assumption of some or all outstanding Awards, or for the grant of new Awards in substitution therefor, by the acquirer or survivor or an affiliate of the acquirer or survivor, in
each case on such terms and subject to such conditions as the Committee determines. The terms and conditions of any substitute Award shall be substantially equivalent to the terms and conditions of the Award that it replaces, taking into account
changes necessitated by the covered transaction, all as determined by the Committee. In the absence of such an assumption or if there is no substitution, except as otherwise provided in the Award each Stock Option, SAR and other Award requiring
exercise will become fully exercisable, and the delivery of Shares or cash issuable or payable under each other outstanding Award will be accelerated, prior to the covered transaction, in each case (where Shares are to be delivered) on a basis that
gives the holder of the Award a reasonable opportunity, as determined by the Committee, following exercise of the Award or the 

	

	 The Gillette Company 	21 	 [Revised __-2005]

issuance of the Shares, as the case may be, to participate as a stockholder in the covered transaction, and the Award will terminate upon consummation of the covered transaction. In the case of Restricted Stock or other Award
subject to restrictions, the Committee may require that any amounts delivered, exchanged or otherwise paid in respect of such Shares or under the Award in connection with the covered transaction be placed in escrow or otherwise made subject to such
restrictions as the Committee deems appropriate to carry out the intent of the Plan. For purposes of the foregoing, a “covered transaction” is any of (i) a consolidation, merger, or similar transaction or series of related transactions in
which the Company is not the surviving corporation or which results in the acquisition of all or substantially all of the Company’s then outstanding common stock by a single person or entity or by a group of persons and/or entities acting in
concert, (ii) a sale or transfer of all or substantially all the Company’s assets, or (iii) a dissolution or liquidation of the Company. Where a covered transaction involves a tender offer that is reasonably expected to be followed by a merger
described in clause (i) (as determined by the Committee), the covered transaction shall be deemed to have occurred upon consummation of the tender offer. 

     15.2 Change of Control of the Company. Unless otherwise specified in an Award Agreement
or an employment agreement between an Employee Participant and the Company, in
the event of a Change of Control, whether or not such Change of Control also
constitutes a “covered transaction” as defined in
Section 15.1 above, the following provisions shall apply, subject to Section 19.A hereof and the Merger Agreement. In the case of a transaction that qualifies as both a Change of Control and a “covered transaction” as
so defined, the vesting provisions of this Section 15.2 shall be applied whether
or not there is an assumption or substitution under Section 15.1, but the provisions
of this Section 15.2 relating to exercise or enjoyment of an Award following
the Change of Control shall apply only to the extent the Award is continued (through
assumption or substitution) in connection with the transaction. 

	 	
(a)             	
All outstanding Options and SARs held by Participants which are not yet exercisable on the date such Change of Control first occurs shall become immediately exercisable and all the rights and benefits relating to such Options and
SARs including, but not limited to, periods during which such Options and SARs may be exercised shall become fixed and not subject to change or revocation by the Company except as otherwise provided under Article 16; 
	 
	 	
(b)             	
In the event that, within two (2) years of a Change of Control, the employment of an employee Participant is terminated by the Company for any reason other than for Cause, or the employee Participant terminates employment for Good
Reason, or the service as a Nonemployee Director is terminated, the applicable exercise period for all Options and SARs (including substituted or assumed Awards, if any, in the case of a Change of Control that is also subject to Section 15.1) held
by him or her at termination of employment shall be the greater of (i) a period of two (2) years from the date of termination, and (ii) the post-termination exercise period otherwise applicable to the employee Participant pursuant to Section 5.8 or
6.7, as applicable, as prescribed by the Committee or set forth in the employee Participant's Award Agreement; provided, however, that in no event shall any Option or SAR be exercisable beyond ten (10) years from its date of grant;  

	

	 The Gillette Company 	22	 [Revised __-2005]

	 	(c)   	Any
        Period of Restriction and restrictions imposed on Restricted Stock or
        Restricted Stock Units shall lapse, and, any Shares subject to Restricted
        Stock Unit Awards shall be delivered on a basis that gives the holder
        of the Award a reasonable opportunity, as determined by the Committee,
    to participate as a stockholder in the Change of Control transaction; 
	 	 	 
	 	(d)   	 The
        target payout opportunities attainable under all outstanding Awards subject
        to performance conditions shall be deemed to have been fully earned on
        the same basis as if targeted performance had been attained for the Performance
    Period; 
	 	 	 

	 	 	
(i)             	
The vesting of all Awards denominated in Shares shall be accelerated as of the effective date of the Change of Control, and shall be paid out to Participants prior to the effective date of the Change of Control. The Committee has
the authority to pay all or any portion of the value of the Shares in cash; and  
	 
	 	 	
(ii)            	
Awards denominated in cash shall be paid to Participants in cash prior to the effective date of the Change of Control; and     
	 	 	 	 
	 	(e) 	 Upon a Change of Control, unless otherwise
      specifically provided in a written agreement entered into between the Participant
      and the Company, all conditions for payment to which outstanding Cash-Based
      Awards and Other Stock-Based Awards may be subject will be deemed satisfied,
    and the Committee shall pay out all such Awards. 

Article 16. Amendment, Modification, Suspension, and Termination 

     16.1 Amendment of the Plan or Awards. The Board of Directors or the Committee may, at any time and from time to time, alter, amend, modify, suspend, or terminate the
Plan or any Award Agreement in whole or in part; provided, however, that, no amendment of the Plan shall be made without shareholder approval if shareholder approval is required by law, regulation, or stock exchange rule; and further provided no
such amendment shall adversely affect the rights of any Participant (without his or her consent) under any Award theretofore granted or other contractual arrangements entered into before or after a “covered transaction” or Change of
Control or deprive any Participant of any right or benefit which became operative in the event of a “covered transaction” or Change of Control. 

     16.2 Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events. The Committee may make adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or nonrecurring events (including, without limitation, the events described in Section 3.4 hereof) affecting the Company or the financial statements of the Company or of changes in applicable
laws, regulations, or accounting principles, whenever the Committee determines that such adjustments are appropriate in order to prevent unintended dilution or enlargement of the benefits or potential benefits intended to be made available under the
Plan. The determination of the Committee as to the foregoing adjustments, if any, shall be conclusive and binding on Participants under the Plan. In the case of performance-based awards to a Covered Employee that are intended to be exempt under
Section 162(m) of the Code, adjustments by the 

	

	 The Gillette Company 	23 	 [Revised __-2005]

Committee shall be made consistent with Article 10 and only to the extent consistent with such exemption. 

     16.3 Replacement Awards. The Company may grant Awards under the Plan on terms differing from those provided for in the Plan where such Awards are granted in
substitution for Awards held by employees of other corporations who concurrently become employees of the 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 that the substitute Awards be granted on such terms and conditions as the Committee considers appropriate in the circumstances.
Shares subject to a substitute or replacement Award granted pursuant to this Section 16.3, or subject to Awards assumed in connection with a transaction described in this Section 16.3, shall not count against the Share limitations described in
Article 3, nor shall the Award limitations described in Article 3 apply to such substitute, replacement, or assumed Awards, in each case except as may otherwise be required to satisfy the ISO rules under Section 422 of the Code or other applicable
legal or stock exchange requirements. 

Article 17. Withholding

     17.1 Tax Withholding. The Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, such amounts as the
Company determines are necessary or desirable to satisfy, or are required by law or regulation to be withheld, with respect to any taxable event arising as a result of this Plan. 

     17.2 Share Withholding. With respect to withholding required upon the exercise of Options or SARs, upon the lapse of restrictions on Restricted Stock and Restricted
Stock Units, or upon the achievement of performance goals related to Performance Shares, or any other taxable event arising as a result of an Award granted hereunder, Participants may elect, subject to the approval of the Committee, to satisfy the
withholding requirement, in whole or in part, by having the Company withhold Shares having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax that could be imposed on the transaction. All such
elections shall be irrevocable, made in writing, and signed by the Participant, and shall be subject to any restrictions or limitations that the Committee deems appropriate.

Article 18. Successors

     All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, its business or its assets whether by direct or indirect
purchase, merger, consolidation, or otherwise. 

Article 19. General Provisions

     19.1 Forfeiture Events. The Committee may specify in an Award Agreement that the Participant’s rights, payments, and benefits with respect to an Award shall be
subject to reduction, cancellation, forfeiture, or recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, but shall not be limited
to, termination of employment for cause, termination of the Participant’s provision of services to the Company and/or Subsidiary, violation of material Company and/or Subsidiary policies, breach of noncompetition, confidentiality, or other
restrictive covenants that may

	

	 The Gillette Company 	24	 [Revised __-2005]

apply to the Participant, or other conduct by the Participant that is detrimental to the business or reputation of the Company and/or its Subsidiaries.

     19.2 Legend. The certificates for Shares may include any legend which the Committee deems appropriate to
reflect any restrictions on transfer of such Shares. 

     19.3 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason,
the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included. 

     19.4 Requirements of Law. The granting of Awards and the issuance of Shares under the Plan shall be subject
to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

     19.5 Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained. 

     19.6 Investment Representations. The Committee may require any person receiving Shares pursuant to an Award
under this Plan to represent and warrant in writing that the person is acquiring the Shares for investment and without any present intention to sell or distribute such Shares. 

     19.7 Employees Based Outside of the United States. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in other countries in
which the Company and/or its Subsidiaries operate or have Employees and/or Nonemployee Directors, the Committee shall have the power and authority, in addition to such power and authority it otherwise has under the Plan, to: 

	 	
(a)             	
Determine which Subsidiaries shall be covered by the Plan;     
	 
	 	
(b)             	
Determine which Employees and/or Nonemployee Directors outside the United States are eligible to participate in the Plan;      
	 
	 	
(c)             	
Modify the terms and conditions of any Award granted to Employees and/or Nonemployee Directors, outside the United States to comply with applicable foreign laws;      
	 
	 	
(d)             	
Establish subplans and modify exercise procedures and other terms and procedures, to the extent such actions may be necessary or advisable. Any subplans and modifications to Plan terms and procedures established under this Section
19.7 by the Committee shall be attached to this Plan document as appendices; and 

	

	 The Gillette Company 	25 	 [Revised __-2005]

 

	 	(e) 	Take any action, before or
        after an Award is made, that it deems advisable to obtain approval or
    comply with any necessary local government regulatory exemptions or approvals. 

     Notwithstanding the above, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate applicable law. 

     19.8 Uncertificated Shares. To the extent that the Plan provides for issuance of certificates to reflect the transfer of Shares, the transfer of such Shares may be
effected on a noncertificated basis, to the extent not prohibited by applicable law or the rules of any stock exchange. 

     19.9 Unfunded Plan. Participants shall have no right, title, or interest whatsoever in or to any investments
that the Company, and/or its Subsidiaries may make to aid it in meeting its obligations under the Plan. Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a
fiduciary relationship between the Company and any Participant, beneficiary, legal representative, or any other person. To the extent that any person acquires a right to receive payments from the Company and/or its Subsidiaries under the Plan, such
right shall be no greater than the right of an unsecured general creditor of the Company or a Subsidiary, as the case may be. All payments to be made hereunder shall be paid from the general funds of the Company or a Subsidiary, as the case may be
and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as expressly set forth in the Plan. The Plan is not subject to ERISA. 

     19.10 No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any
Award. The Committee shall determine whether cash, Awards, or other property shall be issued or paid in lieu of fractional Shares or whether such fractional Shares or any rights thereto shall be forfeited or otherwise eliminated. 

     19.11 Retirement and Welfare Plans. Neither Awards made under the Plan nor Shares or cash paid pursuant to
such Awards, except pursuant to Covered Employee Annual Incentive Awards, will be included as “compensation” for purposes of computing the benefits payable to any Participant under the Company’s or any Subsidiary’s retirement
plans (both qualified and non-qualified) or welfare benefit plans unless such other plan expressly provides that such compensation shall be taken into account in computing a participant’s benefit.

     19.12 Nonexclusivity of the Plan. The adoption of this Plan shall not be construed as creating any
limitations on the power of the Board or Committee, or the Company or any Subsidiary, to adopt such other compensation arrangements as it may deem desirable in the case of any Participant. 

     19.13 No Constraint on Corporate Action. Nothing in this Plan shall be construed to: (i) limit, impair, or otherwise affect the Company’s or a Subsidiary’s
right or power to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer all or any part of its business or assets; or, (ii) limit
the right or power of the Company or a Subsidiary to take any other action which such entity deems to be necessary or appropriate. 

     19.14 Governing Law.

	

	 The Gillette Company 	26	 [Revised __-2005]

     (a) Prior to Effective Time: Except as to matters concerning the issuance of Shares or other matters of corporate governance, which shall be
construed under the General Corporation Law of the State of Delaware, the Plan and each Award outstanding under it shall be governed by the laws of the Commonwealth of Massachusetts, excluding any conflicts or choice
of law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction. Recipients of an Award under the Plan are deemed to submit to the exclusive
jurisdiction and venue of the federal or state courts of Massachusetts, to resolve any and all issues that may arise out of or relate to the Plan or any Award.

     (b) Upon and following Effective Time: The Plan and each Award outstanding under it shall be governed by and
construed in accordance with the laws of the State of Ohio, United States of America, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan to the
substantive law of another jurisdiction. Recipients of an Award under the Plan are deemed to submit to the non-exclusive jurisdiction and venue of the federal or state courts of Ohio, and any other appropriate jurisdiction and venue, to resolve any
and all issues that may arise out of or relate to the Plan or any Award. 

     19.15. Consent. Every Participant who receives or has received an Option, SAR, RSU, grant of Shares, or any other Award pursuant to the Plan shall be bound by the
terms and provisions of the Plan and of the Option, SAR, RSU, Share, or other Award Agreement referable thereto, and the acceptance of any Option, SAR, RSU, Share, or other Award pursuant to the Plan shall constitute a binding agreement between the
Participant and the Company and its subsidiaries and any successors in interest to any of them. Every Person who receives an Option, SAR, RSU, Share, or other Award from a Participant pursuant to the Plan shall, in addition to such terms and
conditions as the Committee may require upon such grant, be bound by the terms and provisions of the Plan and of the Option, SAR, RSU, Share, or other Award Agreement referable thereto, and the acceptance of any Option, SAR, RSU, Share, or other
Award by such Person shall constitute a binding agreement between such Person and the Company and its subsidiaries and any successors in interest to any of them.

Article 19A. Special Merger Provisions

     19A.1 Acceleration of Certain Options. Except as provided in Section 19A.3, each Option outstanding under the Plan on January 27, 2005 (the “Accelerated
Options”) shall be vested and fully exercisable effective immediately prior to the Effective Time as determined by the Authorized Officer. 

     19A.2 Special Merger Elections. Under procedures established by the Authorized Officer, each holder of an Accelerated Option may exercise such Accelerated Option
immediately prior to the Effective Time, in whole or in part, and in respect thereof shall be entitled to receive, at such holder’s election, either (i) the Merger Shares or (ii) a cash payment equal to the product of (A) the excess (if any) of
the per share value of the Merger Shares over the per share exercise price, multiplied by (B) the number of Shares with respect to which the Accelerated Option is exercised, in each case subject to applicable withholding taxes. 

     19A.3 Terms and Conditions of 2005 Options. Notwithstanding any provision in the Plan to the contrary, grants of 2005 Options under the Plan shall not relate to more
than 11,500,000 Shares. 

	

	 The Gillette Company 	27 	 [Revised __-2005]

Each 2005 Option shall be subject to such terms and conditions as the Committee may determine, subject to the provisions of the Plan as revised; provided, however, that
(i) no 2005 Option shall be subject to accelerated vesting upon consummation of the Merger, but (ii) each 2005 Option shall become fully vested and exercisable following the consummation of the Merger in the event the employment of the employee
Participant holder thereof is terminated by the Company or its affiliates other than for Cause, or such holder terminates employment for Good Reason or, in the case of a Participant eligible for retirement under the Company’s benefit plans, for
Retirement.

     19A.4. Termination Following the Effective Time. Unless otherwise provided under the terms of an employment agreement with the Company or its subsidiaries, a
termination of employment for Good Reason within two (2) years of the Effective Time shall be treated for all purposes the same as (A) a Special Separation or (B) in the case of a
Participant eligible for retirement under the Company’s benefit plans, as a Retirement.

     19A.5 Post-Merger
Conversion of Outstanding Accelerated Options and 2005 Options. Each
Accelerated Option and 2005 Option outstanding at the Effective Time (together, “Gillette Stock Options”)
shall cease to represent a right to acquire Shares and, after the Effective Time,
shall be deemed an option to acquire, on the same terms and conditions as were
applicable under the Gillette Stock Option (but taking into account any applicable
changes thereto provided for in this Plan as revised or by reason of the Merger
Agreement), that number of shares of Parent Common Stock determined by multiplying
the number of Shares subject to such Gillette Stock Option by the Exchange Ratio,
rounded, if necessary, to the nearest whole share of Parent Common Stock, at
a price per share (rounded to the nearest one-hundredth of a cent) equal to the
per share exercise price specified in such Gillette Stock Option divided by the
Exchange Ratio; provided, however, that in the case of any Gillette
Stock Option to which Section 421 of the Code applies by reason of its qualification under Section 422 of the Code, the option price, the number of shares subject to such option and, except to the extent otherwise required by the Plan as revised,
the terms and conditions of exercise of such option shall be determined in a manner consistent with the requirements of Section 424(a) of the Code. 

     19A.6. Provisions concerning Options to Nonemployee Directors. Options held by Nonemployee Directors of The Gillette Company immediately prior to the Effective Time
must be exercised within the term of the original grant or within five (5) years from the Effective Time, whichever is shorter.

     19A.7 Assumption of Gillette Stock Options and Certain Undertakings. (a) Subject to the terms of the Merger Agreement, on the Effective Time The Procter & Gamble
Company shall assume the Plan (as revised herein) and each Gillette Stock Option. To the extent permitted by law but not in derogation of the provisions of this Article 19A, The Procter & Gamble Company shall take such reasonable steps as may be
necessary to cause the Gillette Stock Options which qualified under Section 422 of Code as incentive stock options prior to the Effective Time to continue to qualify as incentive stock options of The Procter & Gamble Company after the Effective
Time. 

     (b) Not later than five (5) business days after the Effective Time, The Procter & Gamble Company shall file a registration statement on Form S-3 or Form S-8, as the case may be (or any successor
or other appropriate forms), with respect to the shares of Parent Common Stock subject to such Gillette Stock Options and shall use commercially reasonable efforts to maintain the 

	

	 The Gillette Company 	28	 [Revised __-2005]

effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as such Options remain outstanding or for so long as such
registration statement is required with respect to the Plan. The Procter & Gamble Company shall administer the Plan in a manner consistent with the exemptions provided by Rule 16b-3 promulgated under the Exchange Act. 

Article 20. Definitions

     Whenever used in the Plan, the following terms shall have the meanings set forth below, and when the meaning is intended, the initial letter of the word shall be capitalized. 

	 	20.1	“Accelerated
                         Options” has
          the meaning accorded such term in Article 19A. 
	 	 	 
	 	20.2	“Annual
                         Award Limit” or “Annual Award Limits” have
          the meaning set forth in Section 3.3. 
	 	 	 
	 	20.3 	“Authorized
                         Officer” means
                         each of (i) the Chairman, Chief Executive Officer and
                         President, (ii) the Vice Chairman, (iii) the Senior
                         Vice President, Finance, and Chief Financial Officer,
                         (iv) the Senior Vice President, Strategy and Business
                         Development, (v) the Senior Vice President and General
                         Counsel, (vi) the Secretary and (vii) such other officers
                         of the Company as any of the foregoing may designate
          in writing.  
	 	 	 
	 	20.4 	“Award” means,
                    individually or collectively, a grant under this Plan of
                    Cash-Based Awards, Nonqualified Stock Options, Incentive
                    Stock Options, SARs, Restricted Stock, Restricted Stock Units,
                    Performance Shares, or Other Stock-Based Awards, in each
          case subject to the terms of this Plan.
	 	 	 
	 	20.5 	“Award
                         Agreement” means
                         an agreement entered into and executed by the Company
                         and a Participant setting forth the terms and provisions
          applicable to an Award granted under this Plan. 
	 	 	 
	 	20.6 	“Board” or “Board
                         of Directors” means
          the Board of Directors of the Company. 
	 	 	 
	 	20.7	“Cash-Based
                         Award” means
                         an Award granted to a Participant as described in Section
          9.1. 
	 	 	 
	 	20.8 	“Cause”:
                         For the purposes
                         of the Plan, unless otherwise provided under the terms
                         of an employment agreement with the Company or any of
                         its Subsidiaries, in which case the definition contained
                         therein shall 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 or her duties with the Company or any of its Subsidiaries (other than any such failure resulting from incapacity due to physical or mental illness), after a
written demand for performance is delivered to Participant by an officer or a senior manager of the Company or the Subsidiary which identifies the manner in which the Board or the elected officer or manager believes that Participant has not
performed his or her duties;     

	

	 The Gillette Company 	29	 [Revised __-2005]

	 	
(b)	
The Participant’s engaging in illegal conduct or gross misconduct which is materially and demonstrably injurious 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 to a felony.    
	 	 	 

	 	20.9 	“Change of Control” means
          any of the following events: 
	 	 	 

	 	
(a)             	
The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (A) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (B) the combined voting
power of the then- outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this Paragraph (a), the
following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition 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 (c) below;      
	 
	 	
(b)             	
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 thereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; 
	 
	 	
(c)             	
Consummation of a reorganization, merger, consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following such Business
Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 60% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may
be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through
one or   

	

	 The Gillette Company 	30 	 [Revised __-2005]

	 	 	
more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be,
(B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly,
20% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent
that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement or of the action of the Board providing for such Business Combination; or     
	 
	 	
(d)             	
Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.   

	 	 	 
	 	20.10	“Closing” means the
                    closing of the Merger upon the terms and subject to the conditions
          set forth in Article 6 of the Merger Agreement 
	 	 	 
	 	20.11 	“Code” means
                    the U.S. Internal Revenue Code of 1986, as amended from time
          to time.
	 	 	 
	 	20.12 	Committee” means: 
	 	 	 

	 	
(a)              	
If describing rights, obligations, conditions, and/or circumstances prior to the Effective Time, the Compensation and Human Resources Committee of the Board of The Gillette Company.  
	 
	 	
(b)              	
If describing rights, obligations, conditions, and/or circumstances at or following the Effective Time, the Compensation & Leadership Development Committee (or its functional successor by another name) of The Procter &
Gamble Company   

     20.13 “Company” means: 

	 	
(a)             	
If describing rights, obligations, conditions, and/or circumstances prior to the Effective Time, The Gillette Company, a Delaware corporation; 
	 
	 	(b) 	
If describing rights, obligations, conditions, and/or
circumstances at or following the Effective Time, The Procter & Gamble Company, an Ohio corporation. 
	 	 	 

	 	20.14 	“Company Stock Option
                         Plans” means
          the Plan and the Prior Plan.
	 	 	 
	 	20.15 	“Covered Employee” means
                    a Participant who is a “covered employee,” as defined
                    in Code Section 162(m) and the regulations promulgated under
          Code Section 162(m), or any successor statute.

	

	 The Gillette Company 	31	 [Revised __-2005]

	 	20.16 	“Effective Date” has
          the meaning set forth in Section 1.1. 
	 	 	 
	 	20.17	“Effective Time” has
          the meaning accorded such term in the Merger Agreement. 
	 	 	 
	 	20.18 	“Employee” means
                    any employee of the Company and/or Subsidiaries who was not
                    employed by The Procter & Gamble Company or any of its
          subsidiaries prior to the Effective Time. 
	 	 	 
	 	20.19 	“Exchange Act” means
                    the Securities Exchange Act of 1934, as amended from time
          to time, or any successor act thereto. 
	 	 	 
	 	20.20 	“Exchange Ratio” has
          the meaning accorded such term in the Merger Agreement. 
	 	 	 
	 	20.21	“Fair Market Value” or “FMV” means
                    a price that is based on the opening, closing, actual, high,
                    low, or average selling prices of a Share on the New York
                    Stock Exchange on the applicable date, the preceding trading
                    days, the next succeeding trading day, or an average of trading
                    days, as determined by the Committee. In the case of any
                    Option intended to qualify as an ISO, or an Option or SAR
                    intended to satisfy the performance-based compensation exception
                    requirements of Section 162(m) of the Code by reason of the
                    special stock option/stock appreciation right rules under
                    Section 162(m) of the Code, Fair Market Value (FMV) shall
          be determined on a basis that is consistent with such intent. 
	 	 	 
	 	20.22	“Freestanding SAR” means
                    an SAR that is granted independently of any Options, as described
          in Article 6.
	 	 	 
	 	20.23	“Good Reason” means,
                    for the purposes of the Plan, unless otherwise provided under
                    the terms of an employment agreement with the Company or
                    any of its Subsidiaries, in which case the definition contained
                    therein shall control, an employee Participant terminating
          his or her employment as a direct result of: 
	 	 	 

	 	
(a)             	
The assignment to the Participant of any duties materially inconsistent in any respect with the Participant’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as
in effect immediately prior to the Change of Control, or any other action by the Company or its Subsidiaries that results in a diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial
and inadvertent action not taken in bad faith and that is promptly remedied by the Company and/or the Subsidiary;        
	 
	 	
(b)             	
A decrease in the Participant’s compensation, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and that is promptly remedied by the Company and/or the Subsidiary; or     
	 
	 	
(c)             	
The Company’s or the Subsidiary’s requiring the Participant to be based at any office or location other than (A) the office or where the Participant was based and performed services immediately prior to the Change of
Control or (B) any other 

	

	 The Gillette Company 	32	 [Revised __-2005]

	 	 	location less than 35 miles from
        such office, or the Company’s or the Subsidiary’s requiring
        the Participant to travel on business to a substantially greater extent
    than required immediately prior to the Change of Control. 
	 	 	 
	 	20.24	“Grant Price” means
                 the price established at the time of grant of a SAR pursuant
                 to Article 6, used to determine whether there is any payment
          due upon exercise of the SAR. 
	 	 	 
	 	20.25 	“Incentive Stock Option” or “ISO” means
                 an Option to purchase Shares granted under Article 5 to an Employee
                 and that is designated as an Incentive Stock Option and that
                 is intended to meet the requirements of Code Section 422, or
          any successor provision.
	 	 	 
	 	20.26 	“Merger” means
                 the consummation of the transactions contemplated by the Merger
          Agreement. 
	 	 	 
	 	20.27	“Merger Agreement” means
                 the Agreement and Plan of Merger dated as of January 27, 2005
                 among The Procter & Gamble Company, Aquarium Acquisition
          Corp. and The Gillette Company.
	 	 	 
	 	20.28 	“Merger Shares” has
          the meaning accorded such term in the Merger Agreement. 
	 	 	 
	 	20.29	“Nonemployee Director” has
                 the same meaning set forth in Rule 16b-3 promulgated under the
                 Exchange Act, or any successor definition adopted by the United
          States Securities and Exchange Commission.
	 	 	 
	 	20.30	“Nonqualified Stock Option” or “NQSO” means
                 an Option that is intended not to be an ISO, or that otherwise
          does not meet the requirements of Code Section 422.
	 	 	 
	 	20.31	“Option” means
                 an Incentive Stock Option or a Nonqualified Stock Option, as
          described in Article 5.
	 	 	 
	 	20.32	“Option Price” means
                 the price at which a Share may be purchased by a Participant
          pursuant to an Option.
	 	 	 
	 	20.33	“Other Stock-Based Award” means
                 an Award denominated in Shares that is not described in Articles
          5, 6, 7, or 8. 
	 	 	 
	 	20.34 	“Parent” means
          The Procter & Gamble Company. 
	 	 	 
	 	20.35	“Parent Common Stock” has
          the meaning accorded such term in the Merger Agreement.
	 	 	 
	 	20.36 	“Participant” means
                 any eligible person as set forth in Article 4 to whom an Award
          is granted. 
	 	 	 
	 	20.37	“Performance-Based Compensation” means
                 an Award that is intended to deliver compensation that satisfies
                 the performance-based compensation exception requirements of
                 Section 162(m) of the Code, other than any such Award that is
          an Option or an SAR and that 

	

	 The Gillette Company 	33 	 [Revised __-2005]

	 	 	satisfies such requirements
                    by reason of the special stock option/stock appreciation
          right rules under Section 162(m). 
	 	 	 
	 	20.38	“Performance Measures” means
          the performance measures listed in Article 10.
	 	 	 
	 	20.39 	“Performance Period” means
                    the period of time over which attainment of performance goals
          is to be measured.
	 	 	 
	 	20.40	“Performance Share” means
                    an Award denominated in Shares under which vesting of the
                    Award or the right to payment under the Award (and not merely
                    the possible acceleration of vesting or payment) depends
          on the satisfaction of one or more performance goals. 
	 	 	 
	 	20.41 	“Period of Restriction” means
                    the period when Restricted Stock or Restricted Stock Units
                    are subject to a substantial risk of forfeiture (based on
                    the passage of time, the achievement of performance goals,
                    or upon the occurrence of other events as determined by the
          Committee), as provided in Article 7. 
	 	 	 
	 	20.42	“Plan” means
                    The Gillette Company 2004 Long-Term Incentive Plan as from
          time to time amended and in effect. 
	 	 	 
	 	20.43 	“Plan Year” means
          the calendar year (January 1 to December 31).
	 	 	 
	 	20.44 	“Prior Plan” means
          the 1971 Stock Option Plan of The Gillette Company.
	 	 	 
	 	20.45	“Restricted Stock” means
          an Award of restricted Stock pursuant to Article 7.
	 	 	 
	 	20.46	“Restricted Stock Unit” means
                    an Award pursuant to Article 7 under which the Participant
          is given a conditional right to receive Stock in the future.
	 	 	 
	 	20.47	“Retirement” means:
                    (a) retirement in accordance with the provisions of any appropriate
                    retirement plan of the Company or any of its subsidiaries;
                    or (b) termination of employment under the total and permanent
                    disability provision of any retirement or disability plan
                    of the Company or any of its subsidiaries or any plan to
                    which the Company or its subsidiaries contribute for purposes
          of the retirement or disability of Employees.
	 	 	 
	 	20.48	“Share” means
          a Share of common stock of the Company 
	 	 	 
	 	20.49	“Special
                         Separation” means
                         any termination of employment that occurs prior to the
                         time a Participant is eligible to retire, except a termination
                         for Cause or a voluntary resignation that is not initiated
          or encouraged by the Company.  
	 	 	 
	 	20.50	“Stock Appreciation Right” or “SAR” means
          an Award pursuant to the terms of Article 6.
	 	 	 
	 	20.51	“Subsidiary” means
                    any corporation or other entity, whether domestic or foreign,
                    in which the Company has or obtains, directly or indirectly,
                    a proprietary interest of more than fifty percent (50%) by
          reason of stock ownership or otherwise.

 

	

	 The Gillette Company 	34 	 [Revised __-2005]

	 	20.52 	“Tandem SAR” means
                    an SAR that is granted in connection with a related Option
                    pursuant to Article 6, the exercise of which shall require
                    forfeiture of the right to purchase a Share under the related
                    Option (and when a Share is purchased under the Option, the
          Tandem SAR shall similarly be canceled). 
	 	 	 
	 	20.53	“2005 Options” means
                    each Option granted hereunder after January 27, 2005 and
          prior to the Effective Time.

 

	 	 	 THE GILLETTE COMPANY 
	 	 	 	 	 
	Date:	 	By:	 
	 	
	 	

	 	 	 	Senior Vice President - Human Resources

 

	

	 The Gillette Company 	35	 [Revised __-2005]ex1003

Exhibit 10.3

THE GILLETTE COMPANY 

1971 STOCK OPTION PLAN 

(Amended and Restated as of 

__________
__,
2005) 

      1. PURPOSE.
The purpose of the 1971 Stock Option Plan (hereinafter referred to as the “Plan”)
is to provide a special incentive to selected key salaried employees of The Gillette Company (hereinafter
referred to as the “Company”) and of its subsidiaries and to the non-employee members of the
 Board of Directors of the Company to promote the Company’s business. The Plan is designed to accomplish
 this purpose by offering such employees and non-employee directors a favorable opportunity to purchase
 shares of the common stock of the  Company so that they will share in the success of the Company’s
 business. For purposes of the Plan a subsidiary is any corporation in which the Company owns, directly
 or indirectly, stock possessing fifty percent or more of the total combined  voting power of all classes
 of stock or over which the Company has effective operating control. 

     1.1 ASSUMPTION OF THE PLAN. As of the Effective Time, The Procter & Gamble Company, an Ohio corporation, has assumed the Plan
according to the Merger Agreement. Unless otherwise specified, amendments to the Plan made in connection with the Merger Agreement shall be effective upon the Effective Time. Should the Merger not become effective, the Plan shall revert to the form
as last amended by The Gillette Company through October 2004, without prejudice to any Awards then outstanding.

     2. ADMINISTRATION. The Plan shall be administered by the Compensation Committee heretofore established by the Board of Directors of the
Company, no member of which shall be an employee of the Company or of any subsidiary. The Committee shall have authority, not inconsistently with the Plan, (a) to determine which of the key salaried employees of the Company and its subsidiaries
shall be granted options; (b) to determine whether the options granted to any employees shall be incentive stock options within the meaning of the Internal Revenue Code or non-qualified stock options or both; provided, however, that with respect to
options granted after December 31, 1986, in no event shall the fair market value of the stock (determined at the time of grant of the options) subject to incentive stock options within the meaning of the Internal Revenue Code which first became
exercisable by any employee in any calendar year exceed $100,000 (and, to the extent such fair market value exceeds $100,000, the later granted options shall be treated as non-qualified stock options); (c) to determine the time or times when options
shall be granted to employees and the number of shares of common stock to be subject to each such option provided, however, subject to adjustment as provided in Section 9 of the Plan, in no event shall any employee be granted options covering more
than 1,250,000 shares of common stock in any calendar year; (d) with respect to options granted to employees, to determine the option price of the shares subject to each option and the method of payment of such price; (e) with respect to options
granted to employees, to determine the time or times when each option becomes exercisable and the duration of the exercise period; (f) to prescribe the form or forms of the instruments evidencing any options granted under the Plan and of any other
instruments required under the Plan and to change such 

-2-

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 and proceedings; and (i) to decide all questions and settle all controversies and disputes which may arise in connection with the Plan. All decisions, determinations and interpretations
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 the provisions of Section 8 of the Plan. In addition,
each  non-employee director shall be a participant in the Plan. In any grant of options after the initial
grant, or any sale made under Section 8 of the Plan after the initial sale, employees who were previously
granted 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, the number of shares of common stock of the Company, which may be delivered under the Plan, shall not exceed 198,800,000 in the
aggregate. To the extent that any option granted under the Plan shall expire or terminate unexercised or for any reason become unexercisable as to any shares subject thereto, such shares shall thereafter be available for further grants under the
Plan, within the limit specified above. 

     5. STOCK TO BE DELIVERED. Stock to be delivered under the Plan may constitute an original issue of authorized stock or may consist of
previously issued stock acquired by the Company, as shall be determined by the Committee. The Committee and the proper officers of the Company shall take any appropriate action required for such delivery. 

     6. TERMS AND CONDITIONS OF OPTIONS GRANTED TO EMPLOYEES. All options granted to either non-employee directors or employees shall be subject
to Paragraphs (3) and (4) of Section 6(c) below. All options granted to employees under the Plan shall be subject to all the following additional terms and conditions (except as provided in Sections 7 and 8 of the Plan) and to such other terms and
conditions 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 less than l00 percent of the fair market value per share at the time the option
    is granted. If the Committee so directs, an option may provide that if an employee Participant who
    was an employee participant at the time of the grant of the option and who is not an officer or director
    of the Company at the time of any exercise of the option, he shall not be required to make payment
    in cash or equivalent at that time for the shares acquired on such exercise, but may at his election
    pay the purchase price for such shares by making a payment in cash or equivalent of not less than
    five percent of such price and entering into an agreement, in a form prescribed by the Committee,
    providing for payment of the balance of such price, with interest at a specified rate, but not less
    than four percent, over a period not to exceed five years and containing such other provisions as
    the Committee in its discretion determines.

-3-

  
     In addition, if the Committee so directs, an option may provide for a guarantee by the Company of repayment of amounts borrowed by the Participant in order to exercise the option, provided he is not an officer or director of the
    Company at the time of such borrowing, or may provide that the Company may make a loan, guarantee, or otherwise provide assistance as the Committee deems appropriate to enable the Participant to exercise the option, provided that no such loan,
    guarantee, or other assistance shall be made without approval of the Board of Directors as required 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 or times, whether or not in installments, as the Committee shall prescribe at the time
      the option is granted. In the case of an option held by a participant other than a non-employee director which is not immediately exercisable in full, the Committee may at any time accelerate 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 be subject to such provisions relating to the exercise and other matters as are required
      of incentive stock options under the applicable provisions of the Internal Revenue Code and Treasury Regulations, as from time to time in effect, and the Secretary of the 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 certified bank, or cashier’s check or, with the approval of the Secretary of the
      Committee, in whole or part Common stock of the Company at fair market value, which for this purpose shall be the closing price on the business day preceding the date of exercise, shall be made at the time of such exercise for all shares then being
      purchased thereunder, except in the case of an exercise to which the provisions 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 the United States of America and who is an employee of a foreign subsidiary at the
      time payment is due shall, if the Committee so directs, be paid to such subsidiary in the currency of the country in which such subsidiary is located, computed at such exchange rate as the Committee may direct. The amount of each such payment may,
      in the discretion of the Committee, be accounted for on the books of such subsidiary as a contribution to its capital by the Company. The Company shall not be obligated to deliver any shares unless and until, in the opinion of the Company’s
      counsel, all applicable federal and state laws and regulations have been complied with, nor, in the event the outstanding common stock is at the time listed upon any stock exchange, unless and until the shares 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 

  

-4-

  
    
      matters in connection with the issuance and delivery of shares have been approved by the Company’s counsel. Without limiting the generality of the foregoing, the Company may require from the Participant such investment
        representation or such agreement, if any, as counsel for the Company may consider necessary in order to comply with the Securities Act of 1933 and may require that the Participant agree that any sale of the shares will be made only on the New York
        Stock Exchange or in such other manner as is permitted by the Committee and that he will notify the Company when he makes any disposition of the shares whether by sale, gift, or otherwise. The Company shall use its best efforts to effect any such
      compliance and listing, and the Participant shall take any action reasonably requested by the Company in such connection. A Participant 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 hereinafter defined, all outstanding options held by employee Participants and non-employee
      directors which are not yet exercisable shall become immediately exercisable and all the rights and benefits relating to such options including, but not limited to, periods during which such options may be exercised shall become fixed and not
      subject to change or revocation by the Company except as otherwise provided under Section 6(i). 

          (b) In the event that, within two years of a Change of Control, the employment of an employee Participant is terminated by the Company for any reason other than for Cause, or the employee Participant
      terminates employment for Good Reason, or the service as a director of a non-employee director is terminated, the applicable exercise period for all options, other than options granted prior to June 21, 2001 and designated as incentive stock options
      hereunder, then held by him shall be the greater of (i) a period of two years from the date of termination, and (ii) the post-termination exercise period otherwise applicable to the employee Participant under Section 6(f), or to the non-employee
      director under Section 12(d); provided, however, that in no event shall any option 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 the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a
“Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (A) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common
        Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however,
        that, for purposes of this Paragraph (1), the following acquisitions shall not constitute a Change
        of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company,
        (iii) any acquisition 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;
      

    

  

-5-

  
    
            (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 by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but
        excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of
        proxies or consents by or on behalf of a Person other than the Board; 

            (3) Consummation of a reorganization, merger, consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case,
        unless, following such Business Combination, (A) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such
        Business Combination beneficially own, directly or indirectly, more than 60% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of
        directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets
        either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as
        the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns,
        directly or indirectly, 20% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation,
        except to the extent that such ownership existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board
        at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or 

            (4) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. 

    

  

 

-6-

  
    
           (d) For the purposes
        of the Plan, unless otherwise provided under the terms of an employment agreement with the Company or
        any of its subsidiaries, in which case the definition contained 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 the Participant’s position (including status, offices, titles and
        reporting requirements), authority, duties or responsibilities as in effect immediately prior to the Change of Control, or any other action by the Company or its subsidiaries that results in a diminution in such position, authority, duties or
        responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent 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 inadvertent failure 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 or location other than (A) the office or where the Participant was based and performed services
      immediately prior to the Change of Control or (B) any other location less than 35 miles from such office, or the Company’s or the subsidiary’s requiring the Participant 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 by will 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 options excluded from the application of this Paragraph pursuant to a Schedule to this Plan,
      the Committee in its sole and exclusive discretion may provide in the option agreement covering an option granted hereunder (either at the time of grant or, with the consent 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 and tax laws), to a trust having only family members as
      beneficiaries or to a partnership or company having only family members as partners or owners, or (y) a charitable organization described in Section 501(c)(3) of the Internal Revenue Code. Any options so transferred shall remain subject to the
      otherwise applicable terms of the option agreement and this Plan, and also shall be subject to such terms and conditions as the Committee may prescribe. Subsequent transfers of options shall be permitted under this Paragraph only to the extent, and
      subject to the rules, prescribed by the Committee. 

  

 

-7-

  
    
           (3) A Participant may
        transfer all or any part of an option granted hereunder to a former spouse pursuant to the terms of a
        qualified domestic relations order. Any options so transferred shall remain subject to the otherwise
        applicable terms of the option agreement and this Plan. No subsequent transfers of options shall be permitted
      under this Paragraph. 

  

        (e) Nontransferability of Shares. If the Committee so determines, an option granted to an employee may provide that, without prior consent of
  the Committee, shares acquired by exercise of the option shall not be transferred, sold, pledged or otherwise disposed of within a period not to exceed one year from the date the shares are transferred to the Participant upon his exercise 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 termination of a Participant’s
  employment with the Company and its subsidiaries. If the employment of an employee Participant terminates for any reason other than his death, he may (unless discharged for Cause as hereinafter defined) thereafter exercise his option as provided
  below: 

  
    
            (i) If such termination of employment is voluntary on the part of the employee Participant, he may exercise his option only within 30 days after the date of termination of his employment (unless a
        longer period not in excess of three months is allowed by the Committee). 

            (ii) If such termination of employment is involuntary on the part of the employee Participant, he may exercise his option 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 of his employment, and (II) any option granted after December 31, 2001 within the period ending three years after the date of termination 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 option hereunder, within the period ending two years after his retirement date, (II) any option granted after December 31, 1993 and prior to April 17, 1997, other than an option designated an incentive stock
        option hereunder, within the period ending three years after his retirement date, (III) any option granted prior to April 17, 1997 and designated an incentive stock option hereunder within the period ending three months after his retirement date,
        (IV) any option granted after April 16, 1997 and prior to January 1, 2002 within the period ending five years after his retirement date and (V) any option granted after December 31, 2001 over the remaining option period, provided that an option
        described in clause (IV) or (V) which was designated at grant as an incentive stock option shall cease to qualify as an incentive stock option under the Internal 

    

  

-8-

  
    
      
        Revenue Code if not exercised within three months after his retirement date. For the purposes of his Plan, an employee Participant’s termination of employment is on account 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 which the Company or any subsidiary contributes for
            the benefit of the Participant, (B) the Participant leaves the employ of a subsidiary that does not maintain or contribute to a retirement plan for the benefit of the Participant, and at such time the Participant would have qualified for an early or
            normal retirement pension under the terms of The Gillette Company Retirement Plan had the individual been 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 and years of service (each measured in full and partial years) totals at least 80. An employee Participant’s “retirement
        date”, as used in this paragraph, means the first day the Participant is no longer on the active payroll of the Company or any subsidiary 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 the Participant’s employment (and prior to the expiration of the exercise
    periods specified above), if it deems such action to be in the best interests of the Company. In no event may any Participant exercise any option that was not exercisable on the date he ceased to be an employee, except (A) as to options granted
    prior to January 1, 2002, those options granted at least one year prior to Participant’s cessation of employment on account of retirement or total and permanent disability and (B) as to options granted after December 31, 2001, if the
    Participant’s cessation of employment is on account of retirement or total and permanent disability. In no event may any Participant exercise any option after the expiration of the option period. For the purposes of this Subsection (f), a
    Participant’s employment shall not be considered terminated in the case of a sick leave or other bona fide leave of absence approved by the Company or a subsidiary in conformance with the applicable provisions of the Internal Revenue Code or
    Treasury Regulations, or in the case of a transfer to the employment of a subsidiary or to the employment of the Company. 

          If an employee Participant is discharged for Cause, as hereinafter defined, all his options shall immediately be cancelled effective as of the date of termination of his employment. For the purposes
    of the Plan, unless otherwise provided under the terms of an employment agreement with the Company or any of its subsidiaries, in which case the definition contained therein shall control, a discharge for “Cause” shall have occurred where
    a Participant is terminated because of: 

  

 

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             (A) the Participant’s
            continued failure to perform substantially his duties with the Company or any of its subsidiaries (other
            than any such failure resulting from incapacity due to physical or mental illness), after a written demand
            for performance is delivered to Participant by an officer or a senior manager of the Company or the subsidiary
            which identifies 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 demonstrably injurious 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 prior to January 1, 2002 may be
  exercised within a period not to exceed one year after the date of death, and (II) any option granted after 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 the shares covered
  by such option, by his executor or administrator of the person or persons to whom the option is transferred by will or the applicable laws of descent and distribution, and except as so exercised the option shall expire after the expiration of such
  period. 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 to time, if provided by the
  Committee, in its sole and exclusive discretion, in the option agreement covering an option granted hereunder, a Participant may elect to defer the delivery of the shares acquired upon the exercise of the option; provided that such election may not
  be made with respect to any incentive stock option or any option transferred pursuant to the provisions of Section 6(d) above. The Participant’s deferral election must be made at least six months prior to the date such option is exercised or at
  such other time as the Committee may specify. Payment of the option exercise price must be made in the form of shares of common stock which the Participant has held for at least six months. Deferral elections will be allowed only for option
  exercises that occur while the Participant is an active employee of the Company and its subsidiaries or is actively serving as a non-employee director, as the case may be. Any election to defer the delivery of the stock shall be irrevocable as long
  as the Participant remains 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), the Company shall credit to a bookkeeping account a number of deferred stock units
  equal to the number of shares that otherwise would have been delivered to the Participant. During the period of deferral, the deferred stock units shall accrue dividends at the rate paid upon the Company’s common stock, which dividend
  equivalents shall be credited in the form of additional deferred stock units. Deferred stock units shall be distributed in shares of common stock (with cash payment in lieu of any fractional share) upon the Participant’s termination of
  employment with the Company and its subsidiaries or following the date the Participant’s membership on the Board of Directors ceases, as the case may be, or if the Participant’s termination is on account of retirement, at such other date
  or dates as may be approved by the Committee over a period extending no later than 10 years following such termination date. 

-10-

        The Committee may, in its sole discretion, allow for the early distribution of an employee Participant’s deferred stock 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, the Committee in its discretion may direct the distribution of an
    employee Participant’s deferred stock units if it believes such action is in the best interest of the Company. Deferred stock units shall not be assigned or alienated by any Participant, and shall not 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 between an 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 The Gillette U.K. Approved Stock Option Plan (“2001 UK approved option”), the
      Committee may, in its sole discretion, cancel any such option at or any time after the date of termination of an employee Participant’s employment (and prior to the expiration 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) (“covered option”), the following terms and conditions shall apply: 

    
            (a) Unless otherwise provided pursuant to a termination settlement agreement with the Company or any of its subsidiaries, while the Participant is employed by the Company and for a period of eighteen
        (18) months after the termination or cessation 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 more than 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) is substantially similar to or competes with any business, product, service or other matter regarding which the Participant worked for the 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, during the 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 take away, the business or patronage of any of the clients, customers or accounts, or
          prospective clients, customers or accounts, of the Company which were contacted, solicited or served, directly or indirectly, by Participant while employed by the Company; or 

      

    

  

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              (iii) either alone or in association with others: (A) solicit or encourage any employee or independent contractor of the Company to terminate his/her relationship with the Company; or (B) recruit,
          hire or solicit for employment or for engagement as an independent contractor, any person who is or was employed by the Company at any time during the Participant’s employment with the Company; provided, that this Paragraph (iii) shall not
          apply to such person whose employment with the Company has been terminated 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 obtained or acquired by the Participant during, after, or by reason of, employment with
      the Company or any of its subsidiaries, as provided under applicable law and any and all agreements between the Participant and the Company or any of its subsidiaries regarding Participant’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 subsidiaries regarding the Participant’s employment, the Participant shall disclose promptly
      and transfer and assign to the Company all improvements and inventions in certain fields made or conceived by the Participant during employment with the Company or the subsidiary 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 or stated, any defamatory or disparaging statement, writing or communication
      pertaining to the character, reputation, business practices, 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 its subsidiaries 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 be unenforceable because it extends for too long a period of time or over too great a
    range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may 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. 

     

      

  

-12-

 

  
         (6) If the Company reasonably determines
        that a Participant has materially violated any of the Participant’s obligations under Paragraph
        (2) above, or if a Participant is terminated for Cause, then,
        in addition to any other remedies at law or 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 to their 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’s exercise of any covered option during the period commencing one year prior to the
        Participant’s termination of employment and continuing through the Violation Date. Upon demand, the Participant shall pay to the Company the amount of any gain realized or payment received as a result of such exercises. At the option of the
        Company, such payment shall be made by returning to the Company the number of shares of common stock of the Company which the Participant received in connection with such exercise (with the Company then refunding the option price paid by the
        Participant), or in cash in the amount of the gain realized. If after such demand the Participant fails to return said shares or amounts, the Company shall have the right to offset said amounts against any amounts, including compensation, owed to
        the Participant by the Company or to commence judicial proceedings against the Participant to recover said shares or amounts.

    

          (7) The non-competition restrictions set forth in Paragraph (2)(a) supersede any non-competition restrictions of less than eighteen (18) months in duration set forth in any agreement between a
    Participant and the Company or any subsidiary or predecessor. 

  

     7. REPLACEMENT OPTIONS. The Company may grant options under the Plan on terms differing from those provided for in Section 6 of the Plan
where such options are granted in substitution for options held by employees of other corporations who concurrently become employees of the 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 that the substitute options be granted on such terms and conditions as the Committee considers
appropriate in the circumstances. 

     Notwithstanding anything contained in this Plan,
the Committee shall have authority, with respect to any options granted or to be granted to employees
or outstanding installment Purchase Agreements of participants other than non-employee directors under
this Plan, to extend the time for payment of any and all installments, to modify the amount of any installment,
to amend outstanding option certificates 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 installment
Purchase Agreements and unexercised options, shall at all times be in accordance with the applicable
provisions of Regulation G of the Board of Governors of the Federal Reserve System, as from time to time
amended, and with all other applicable legal requirements; (3) no such action by the Committee shall
jeopardize the status of stock options as incentive stock options under the Internal Revenue Code. 

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     8. FOREIGN EMPLOYEES. The Company may grant options under the Plan on terms differing from those provided for in Section 6 of the Plan where
such options are granted to employee Participants who are not citizens or residents of the United States of America if the Committee 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 the Committee determines that options are inappropriate for any key salaried employees who are not citizens or residents of the United States of America, whether because of the tax
laws of the foreign countries in which such employees are residents or for other reasons, the Board of Directors may authorize special arrangements for the sale of shares of common stock of the Company to such employees, 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 by such subsidiary, to whom
the shares are to be sold. Such arrangements shall provide for a purchase price of not less than the fair market value of the stock at the date of sale and a maximum annual grant per participant of options to purchase 1,250,000 shares of common
stock and may provide that the purchase price be paid over a period of not more than ten years, with or without interest, and that such employees have the right, with or without payment of a specified premium, to require the seller of the shares to
repurchase such shares at the same price, subject to specified conditions. Such arrangements may also include provisions deemed appropriate as to acceleration or prepayment of the balance of the purchase price, restrictions on the transfer of the
shares by the employee, representations or agreements by the employee about his investment purposes and other miscellaneous matters. 

     9. CHANGES IN STOCK. In the event of a stock dividend, split-up or combinations of shares, recapitalization or merger in which the Company is
the surviving corporation, or other similar capital change, the number and kind of shares of stock or securities of the Company to be subject to the Plan and to options then outstanding or to be granted thereunder, the maximum number of shares or
securities which may be issued or sold under the Plan, the maximum annual grant for each participant, the automatic annual grant for each non-employee director, the option price and other relevant provisions shall be appropriately adjusted by the
Board of Directors of the Company, whose determination shall be binding on all persons. In the event of a consolidation or a merger in which the Company is not the surviving corporation or which results in the acquisition of substantially all the
Company’s outstanding stock by a single person or entity or by a group of persons and/or entities acting in concert, or in the event of complete liquidation of the Company, all outstanding options shall thereupon terminate, provided that (i) at
least twenty days prior to the effective date of any such consolidation or merger, the Board of Directors shall with respect to employee participants either (a) make all outstanding options immediately exercisable, or (b) arrange to have the
surviving corporation grant replacement options to the employee Participants and (ii) in the case of option grants to non-employee directors, all outstanding options not otherwise exercisable shall become exercisable on the twentieth day prior to
the effective date of the merger. 

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     10. EMPLOYMENT RIGHTS. The adoption of the Plan does not confer upon any employee of the Company or a subsidiary any right to continued
employment 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 a subsidiary to terminate the employment of any of its employees at any time. 

     11. AMENDMENT OF PLAN OR OPTIONS. The Board of Directors of the Company, or the Compensation Committee of the Board of Directors if and to
the extent authorized, may at any time or times amend the Plan or amend any outstanding option or options or arrangements established under Section 8 of the Plan for the purpose of satisfying the requirements of any changes in applicable laws or
regulations or for any other purpose which may at the time be permitted by law, provided that (except to the extent required or permitted under Section 9 of the Plan and, with respect to clauses (b) and (f) below, except to the extent required or
permitted under Section 7 of the Plan) no such amendment shall, without the approval of the stockholders of the Company, (a) increase the maximum number of shares available under the Plan or the maximum annual grant per participant other than as
permitted under Section 9 of the Plan, (b) reduce the minimum option price of options thereafter to be granted below the price provided for in Section 6(a) of the Plan, except that the Plan may be amended to provide that the minimum option price of
non-qualified stock options thereafter to be granted to employees may be not less than 95% of the fair market value at the date of grant if the Board determines that such amendment is necessary for tax reasons to carry out the objectives of the
Plan, (c) reduce the price at which shares of common stock of the Company may be sold under Section 8 of the Plan below the price provided for in said Section 8, (d) reduce the option price of outstanding options, (e) extend the time within which
options may be granted, or (f) extend the period of an outstanding option beyond 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 a Change of Control deprive any Participant of any right or benefit which became operative in the event of a Change of Control. 

     12. TERMS AND CONDITIONS OF OPTIONS GRANTED TO NON-EMPLOYEE DIRECTORS. Effective
at the close of business on the second business day after the 1992 Annual Meeting of Shareholders of the Company and on the second business day after each Annual Meeting thereafter, each non-employee director shall be automatically granted a
non-incentive stock option to purchase 4,000 shares (5,000 shares for options granted after 2001 and before 2004, and 7,500 shares for options granted after 2003) of the common stock of the Company under the generally 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, which for this purpose is defined
    as the average between the high and the low price of the common stock as reported by the New York Stock Exchange. 

  
          (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 of the first Annual Meeting following the date of grant
        or the first anniversary of the date of grant, except as otherwise provided under Paragraph (4)
        of Section 6(c) of the Plan. Each option granted after 2000 shall become exercisable ratably
        over a three

year period (for options granted after 2003, this means 2,500 after one year, an additional 2,500 after two years and the remaining 2,500 after three years) on the earlier of the Annual Meeting or the anniversary of the date of
  grant in each such year, except as otherwise 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-employee director remains a member of the
  Board of Directors and for a period of three months following the date a non-employee director ceases to be a director; provided that, in the case where the non-employee director either has attained age 65 or has served as a non-employee director
  for at least five years when membership on the Board of Directors ends, all of that non-employee director’s options shall be exercisable for a period of two years with respect to options granted before 1994, three years for options granted
  after 1993 and before 2001, five years for options granted after 2000 and before 2002, and the remaining option period 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 Board of Directors ceases while an option remains exercisable in accordance with the
  preceding paragraph, then (I) for options granted before 2002, at any time or times within one year after that non-employee director’s death, and (II) for options granted after 2001, at any time or times within three years after that
  non-employee director’s death, that non-employee director’s option may be exercised in accordance with the provisions of Section 6(g) of the Plan. In no event shall any option be exercised after the expiration of the option period.
  

13. GOVERNING LAW.

     (a) Prior to Effective Time: Except as to matters concerning the issuance of shares or other matters of corporate governance, which shall be
construed under the General Corporation Law of the State of Delaware, the Plan and each Award issued under it shall be governed by the laws of the Commonwealth of Massachusetts, excluding any conflicts or choice of
law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction. Recipients of an option under the Plan are deemed to submit to the exclusive
jurisdiction and venue of the federal or state courts of Massachusetts, to resolve any and all issues that may arise out of or relate to the Plan or any option.

 

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     (b) Upon
and following Effective Time: The
Plan and each option issued under it shall be governed by and construed in accordance with the laws of
the State of Ohio, United States of America, excluding any conflicts
or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan
to the substantive law of another jurisdiction. Recipients of an option under the Plan are deemed to
submit to the exclusive jurisdiction and venue of the federal or state courts of Ohio, to resolve any
and all issues that may arise out of or relate to the Plan or any option. 

 14. SPECIAL MERGER PROVISIONS

     14.1 Acceleration of Options. Notwithstanding any other provision in the Plan, each option outstanding under the Plan (the “Accelerated Options”) shall be
  vested and fully exercisable effective immediately prior to the Effective Time as determined by the Authorized Officer. 

     14.2 Special Merger Elections. Under procedures established by the Authorized Officer, each holder of an Accelerated Option may exercise such Accelerated Option
immediately prior to the Effective Time, in whole or in part, and in respect thereof shall be entitled to receive, at such holder’s election, either (i) the Merger Shares or (ii) a cash payment equal to the product of (A) the excess (if any) of
the per share value of the Merger Shares over the per share exercise price, multiplied by (B) the number of Shares with respect to which the Accelerated Option is exercised, in each case subject to applicable withholding taxes. 

     14.3 Termination Following the Effective Time. Unless otherwise provided under the terms of an employment agreement with the Company or its subsidiaries, a termination
of employment for Good Reason within two (2) years of the Effective Time shall be treated for all purposes the same as (A) a Special Separation or (B) in the case of a Participant eligible
for retirement under the Company’s benefit plans, as a Retirement.

     14.4 Post-Merger Conversion of Outstanding Accelerated Options. Each Accelerated Option outstanding at the Effective Time (together, “Gillette Stock
Options”) shall cease to represent a right to acquire Shares and, after the Effective Time, shall be deemed an option to acquire, on the same terms and conditions as were applicable under the Gillette Stock Option (but taking into account any
applicable changes thereto provided for in this Plan as revised or by reason of the Merger Agreement), that number of Shares of Parent Common Stock determined by multiplying the number of Shares subject to such Gillette Stock Option by the Exchange
Ratio, rounded, if necessary, to the nearest whole share of Parent Common Stock, at a price per share (rounded to the nearest one-hundredth of a cent) equal to the per share exercise price specified in such Gillette Stock Option divided by the
Exchange Ratio; provided, however, that in the case of any Gillette Stock Option to which Section 421 of the Code applies by reason of its qualification under Section 422 of the Code, the
option price, the number of shares subject to such option and, except to the extent otherwise required by the Plan as revised, the terms and conditions of exercise of such option shall be determined in a manner consistent with the requirements of
Section 424(a) of the Code. 

      14.5 Provisions concerning Options to
Nonemployee Directors. Options held by Nonemployee
Directors of The Gillette Company immediately prior to the Effective Time must be exercised within the
term of the original grant or within five (5) years from the Effective Time, whichever is shorter.

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     14.6 Assumption of Gillette Stock Options
and Certain Undertakings. Subject to the terms of the Merger Agreement,
on the Effective Time The Procter & Gamble Company shall assume the Plan (as revised herein) and
each Gillette Stock Option. To the extent permitted by law but not in derogation of the provisions of
this Article 14, The Procter & Gamble Company shall take such reasonable steps as may be necessary
to cause the Gillette Stock Options which qualified under Section 422 of Code as incentive stock options
prior to the Effective Time to continue to qualify as incentive stock options of The Procter & Gamble
Company after the Effective Time. 

     14.7 Special Separation. In the case of a Special Separation, any option must be exercised within the term of the original grant or five (5)
  years from the date of Special Separation, whichever is shorter. 

15. DEFINITIONS 

Whenever used in the Plan, the following terms shall have the meanings set forth below, and when the meaning is intended, the initial letter of the word shall be capitalized. 

      15.1 “Accelerated Options” has the meaning accorded such term in Article 14. 

      15.2 “Authorized Officer” means each of (i) the Chairman, Chief Executive Officer and President, (ii) the Vice
Chairman, (iii) the Senior Vice President, Finance, and Chief Financial Officer, (iv) the Senior Vice President, Strategy and Business Development, (v) the Senior Vice President and General Counsel, (vi) the Secretary and (vii) such other officers
of the Company as any of the foregoing may designate in writing. 

      15.3 “Board” or “Board of Directors” means the
Board of Directors of the Company. 

      15.4 “Closing” means the closing of the Merger upon the terms and subject to the conditions set forth in Article 6 of the Merger
Agreement 

      15.5 Committee” means: 

	 	(a)	If describing rights, obligations, conditions,
        and/or circumstances prior to the Effective Time, the Compensation and Human Resources Committee
    of the Board of The Gillette Company.
	 	 	 
	 	(b)	If describing rights, obligations,
        conditions, and/or circumstances at or following the Effective Time, the Compensation & Leadership
        Development Committee (or its functional successor by another name) of The Procter & Gamble
    Company

      15.6 “Company” means: 

	 	(a)	If describing rights, obligations, conditions,
    and/or circumstances prior to the Effective Time, The Gillette Company, a Delaware corporation; 
	 	 	 
	 	(b)	If describing rights, obligations,
        conditions, and/or circumstances at or following the Effective Time, The Procter & Gamble
    Company, an Ohio corporation. 

      15.7 “Effective Time” has the meaning accorded such term in the Merger Agreement. 

      15.8 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor act thereto. 

      15.9 “Exchange Ratio” has the meaning accorded such term in the Merger Agreement. 

      15.10 “Merger” means the consummation of the transactions contemplated by the Merger Agreement. 

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      15.11 “Merger Agreement” means the Agreement and Plan of Merger dated as of January 27, 2005 among The Procter & Gamble Company, Aquarium Acquisition Corp. and The Gillette Company.

      15.12 “Merger Shares” has the meaning accorded such term in the Merger Agreement. 

      15.13 “Nonemployee Director” has the same meaning set forth in Rule 16b-3 promulgated under the Exchange Act, or any successor definition adopted by the United States Securities and
Exchange Commission.

      15.14 “Parent” means The Procter & Gamble Company. 

      15.15 “Parent Common Stock” has the meaning accorded such term in the Merger Agreement. 

      15.16 “Participant” means any eligible person to whom an Award is granted. 

      15.17 “Plan” means The Gillette Company 1971 Stock Option Plan as from time to time amended and in effect. 

      15.18 “Retirement” means: (a) retirement in accordance with the provisions of any appropriate retirement plan of the Company or any of its subsidiaries; or (b) termination of employment
under the total and permanent disability provision of any retirement or disability plan of the Company or any of its subsidiaries or any plan to which the Company or its subsidiaries contribute for purposes of the retirement or disability of
Employees. 

      15.19 “Share” means a Share of common stock of the Company 

      15.20 “Special Separation” means any termination of employment that occurs prior to the time a Participant is eligible to retire, except a termination for Cause
or a voluntary resignation that is not initiated or encouraged by the Company. 

      15.21 “Subsidiary” means any corporation or other entity, whether domestic or foreign, in which the Company has or obtains, directly or indirectly, a proprietary
interest of more than fifty percent (50%) by reason of stock ownership or otherwise.

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