Document:

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                                                                   Exhibit 10(a)

                              THE GILLETTE COMPANY
                       1971 STOCK OPTION PLAN, AS AMENDED

     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.

     2.   ADMINISTRATION. The Plan shall be administered by the Personnel
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
800,000 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 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; (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. In addition, each
non-employee director shall be a participant in the Plan. In any grant of
options after the initial grant, or

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any sale made under Section 8 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 after April 18, 2002, 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 158,800,000 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 Board of
Directors. The Board of Directors 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
Section 6 Paragraph (c) Subparagraphs (4) and (5). 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 below) 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. 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.

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               (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) Each incentive stock option within the meaning of the
               Internal Revenue Code granted on or before December 31, 1986
               shall contain and be subject to the following provision:

                    This option shall not be exercisable while there is
                    outstanding (within the meaning of Section 422A(c)(7) of the
                    Internal Revenue Code of l954, as amended) any incentive
                    stock option (as that term is defined in said Code) which
                    was granted to the Participant before the granting of this
                    option to purchase stock in his employer corporation
                    (whether The Gillette Company or a parent or subsidiary
                    corporation thereof), or in a corporation which at the time
                    of the granting of this option is a parent or subsidiary
                    corporation of the employer corporation, or in a predecessor
                    corporation of any such corporation.

                    Each incentive stock option within the meaning of the
               Internal Revenue Code granted after December 31, 1986 shall not
               be subject to the above provision.

                    (4) 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 subsection (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

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               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 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.

                    (5) Notwithstanding any other provision of this Plan, if
               within one year of a Change in Control, as hereinafter defined,
               the employment of an employee Participant is terminated for any
               reason other than willful misconduct or the service as a director
               of a non-employee director is terminated, all his outstanding
               options 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; provided, that in the case
               of any incentive stock option (the "second option") which is not
               exercisable by reason of a previously granted incentive stock
               option which is still "outstanding" within the meaning of section
               422A(c)(7) of the Internal Revenue Code (as in effect before the
               amendments made by the Tax Reform Act of 1986), the second option
               shall not be exercisable until the earlier outstanding option is
               exercised in full or expires by reason of the lapse of time. For
               purposes of the foregoing, a Change in Control shall mean the
               happening of any of the following events:

                         (A) Any person within the meaning of Sections 13(d) and
                    14(d) of the Securities Exchange Act of 1934 (the "1934
                    Act"), other than the Company or any of its subsidiaries,
                    has become the beneficial owner, within the meaning of Rule
                    13d-3 under the 1934 Act, of 20% or more of the combined
                    voting securities of the Company;

                         (B) A tender offer or exchange offer, other than an
                    offer by the Company, pursuant to which shares of the
                    Company's common stock have been purchased;

                         (C) The stockholders or directors of the Company have
                    approved an agreement to merge or consolidate with or into
                    another corporation and the Company is not the surviving
                    corporation or an agreement to sell or otherwise dispose of
                    all or substantially all of the Company's assets (including
                    a plan of liquidation); or

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                         (D) During any period of two consecutive years,
                    individuals who at the beginning of such period constituted
                    the board of directors cease for any reason to constitute at
                    least a majority thereof. For this purpose, new directors
                    who were elected, or nominated (or approved for nomination
                    in the case of nomination by a Committee of the Board) for
                    election by shareholders of the Company, by at least two
                    thirds of the directors then still in office who were, or
                    are deemed to have been directors at the beginning of the
                    period, shall be deemed to have been directors at the
                    beginning of the period.

               (d)  NONTRANSFERABILITY OF OPTIONS. No option may be transferred
          by the Participant otherwise than by will or by the laws of descent
          and distribution, and during the Participant's lifetime the option may
          be exercised only by him.

               (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. If the employment of an employee
          Participant terminates for any reason other than his death, he may,
          unless discharged for cause which in the opinion of the Committee
          casts such discredit on him as to justify termination of his option,
          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 his option only within one year after the date of
               termination of his employment.

                    (iv) Notwithstanding the above, if an employee Participant
               (a) upon termination of the employment with the Company begins
               receiving early or normal retirement benefits under The Gillette
               Company Retirement Plan, (b) upon termination of employment with
               a subsidiary begins receiving retirement benefits under a
               retirement plan maintained by or to which the subsidiary
               contributes, or (c) leaves the employment of a subsidiary which
               does not maintain or contribute to a retirement plan for the
               benefit of the Participant at a time when the Participant would
               have been eligible to begin receiving early or normal retirement

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               benefits under The Gillette Company Retirement Plan had the
               individual been a participant of that Plan, he may exercise (I)
               any option granted prior to January 1, 1994, other than an option
               designated as an incentive stock option hereunder, within a
               period not to exceed 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 a period not to exceed three years after
               his retirement date, (III) any option granted prior to April 17,
               1997 and designated an incentive stock option hereunder within a
               period not to exceed three months after his retirement date, and
               (IV) any option granted after April 16, 1997 within a period not
               to exceed five years after his retirement date, provided that
               such option shall cease to qualify as an incentive stock option
               under the Internal Revenue Code if not exercised within three
               months after his retirement date.

               The Committee may, in its sole discretion, terminate any such
          option at or any time after the date when that option otherwise would
          have terminated as a result of the termination of the Participant's
          employment, if it deems such action to be in the best interests of the
          Company. In no event, however, may any Participant exercise any option
          (i) which was not exercisable on the date he ceased to be an employee,
          except in the case of options granted at least one year prior to a
          Participant's cessation of employment on account of retirement or
          total and permanent disability, or (ii) after the expiration of the
          option period. For the purposes of this Paragraph (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.

               (g) DEATH. If a Participant dies while holding an option which
          had been granted at least one year prior to the date of death, then at
          any time or times within one year after his death (or with respect to
          employee Participants such further period as the Committee may allow)
          such option may be exercised, 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.

     7.   REPLACEMENT OPTIONS. The Company may grant options under the Plan on
terms differing from those provided for in Section 6 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

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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.

     8.   FOREIGN EMPLOYEES. The Company may grant options under the Plan on
terms differing from those provided for in Section 6 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).

     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 800,000 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)

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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.

     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.  THE COMMITTEE MAY AT ANY TIME DISCONTINUE GRANTING OPTIONS UNDER THE
PLAN. The Board of Directors of the Company or the Personnel 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 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 and, with respect to clauses (b) and (f) below, except
to the extent required or permitted under Section 7) 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, (b) reduce the minimum
option price of options thereafter to be granted below the price provided for in
Section 6(a), 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 below the price provided
for in Section 8, (d) reduce the option price of outstanding options, (e) extend
the time within which options may be granted, (f) extend the period of an
outstanding option beyond ten years from the date of grant, (g) amend the
provisions of Section 12 with respect to the terms and conditions of options to
non-employee directors 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 in Control deprive any Participant of any right or benefit
which became operative in the event of a Change in Control. Notwithstanding the
above, in no event may the provisions of Section 12 be amended more than once
every six months, other than to comport with changes in the Internal Revenue
Code, the Employee Retirement Income Security Act, or the rules thereunder.

     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 of
the common stock of the Company upon the following 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 on
     the NYSE Composite Transaction listing.

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          (b)  OPTION PERIOD. The period of an option shall be ten years from
     the date of grant.

          (c)  OPTION EXERCISE. Each option shall become exercisable 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
     Section 6 Paragraph c Subparagraph 5 of this Plan. 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 except
     in the case where the non-employee director is or will be eligible to
     receive benefits under the Company's Retirement Plan for Directors when
     membership on the Board of Directors ends and where the non-employee
     director continues to be so eligible as of the date of exercise, that
     non-employee director's options shall be exercisable for a period of two
     years with respect to options granted before 1994 and three years for
     options granted after 1993 from the date membership on the Board of
     Directors ceases.

          If a non-employee director dies at the time when the non-employee
     director is entitled to exercise an option, then at any time or times
     within one year after that non-employee director's death that non-employee
     director's option may be exercised in accordance with the provisions of
     Section 6 Paragraph (g) of the Plan. In no event shall any option be
     exercised after the expiration of the option period.

          (d)  PAYMENT FOR DELIVERY OF SHARES. Payment for the shares shall be
     made in accordance with the provisions of Section 6 Paragraph c
     Subparagraph 4 of this Plan.

          (e)  NONTRANSFERABILITY OF OPTIONS. No option may be transferred by a
     non-employee director otherwise than by will or by the laws of descent and
     distribution, and during the non-employee director's lifetime the option
     may be exercised only by the non-employee director.

March 18, 1999

                                       9<PAGE>   1

                                                                   Exhibit 10(b)

                              THE GILLETTE COMPANY
                           STOCK EQUIVALENT UNIT PLAN
                       (AS AMENDED THROUGH DECEMBER 1999)

1. PURPOSE. The purpose of the Stock Equivalent Unit Plan is to provide an
incentive and reward to key salaried employees of The Gillette Company and its
subsidiaries who can make substantial contributions to the success of the
business. To that end, the Plan provides an opportunity for such key salaried
employees to participate in that success through awards of stock equivalent
units, subject to the conditions set forth in the Plan.

2. DEFINITIONS. Unless the context otherwise requires, the following words have
the following meanings for purposes of the Plan.

2.1 Basic stock unit - A stock equivalent unit awarded to a participant pursuant
to Section 4.2.

2.2 Committee - The Personnel Committee established by the Board of Directors of
the Company.

2.3 Company - The Gillette Company, a Delaware corporation.

2.4 Disability - Mental or physical disability, either occupational or
non-occupational in cause, which, in the opinion of the Committee, on the basis
of medical evidence satisfactory to it, prevents the employee from engaging in
any occupation or employment for wage or profit and is likely to be permanent.

2.5 Dividend equivalent unit - A stock equivalent unit which is credited to a
participant's account as the result of conversion of amounts credited to the
account in respect of dividends, as provided in Section 5.2.

2.6 Employee - Any person, whether or not an officer or director of the Company
or any subsidiary, who is regularly employed by the Company or a subsidiary on a
salaried full-time basis, or who, under conditions approved by the Committee, is
regularly employed by the Company or subsidiary on a salaried part-time basis.

2.7.1 Maturity date (with respect to awards made on or before 12/31/83) - When
used with respect to an award, March l5 of the tenth calendar year following the
calendar year in which the award was made.

2.7.2 Maturity date (with respect to awards made after 12/31/83) - When used
with respect to an award, March 15 of the seventh calendar year following the
calendar year in which the award was made.

2.8 Normal retirement date - In the case of any participant, the date
established by his employer as his normal retirement date (or, if no such plan
is maintained by his employer, the normal retirement date prescribed under The
Gillette Company Retirement Plan).

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2.9 Plan - The Stock Equivalent Unit Plan set forth herein, as from time to time
amended.

2.10 Share - A share of the Company's common stock as the same is constituted
from time to time.

2.11 Stock equivalent unit - A measure of value equal in amount to the value of
one share at the time of reference.

2.12 Subsidiary - 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.

2.13(A) Total credits - When used with respect to an individual account, the sum
of (a) the excess, if any, of (i) the value of that number of shares which is
equal to the number of basic stock units credited to the account in respect of
awards in designated years, after adjustment for any prior payments, over (ii)
the value on the date of the respective awards of that number of shares which
corresponds, after adjustment for stock splits, stock dividends and similar
capital changes, to the number of basic stock units referred to in (i), except
that for awards made after 12/31/78, the amount of the excess cannot exceed an
amount equal to the value on the date of the respective awards of that number of
shares which corresponds, after adjustment for stock splits, stock dividends and
similar capital changes, to the number of basic stock units referred to in (i),
plus (b) the value of that number of shares which is equal to the number of
dividend equivalent units then credited to the account in respect of such awards
plus (c) any amounts then credited to the account based on dividend payments
attributable to such awards which have not been converted into dividend
equivalent units.

2.14 Value - When used with respect to a share:

(a) On the date of an award of basic stock units, the average of the reported
high and low sales prices of the shares as quoted on a composite basis;

(b) For purposes of converting dividend credits into dividend equivalent units,
the average of the reported closing prices of the shares as quoted on a
composite basis on the last business day of the months of December, January, and
February immediately preceding the March l5 on which such conversion occurs;

(c) For purposes of determining the amount payable in respect of an interest
which becomes vested or for purposes of determining the amount payable, in cases
not covered by (d) or (e) below, in respect of an interest which previously
became vested, the average of the reported closing prices of the shares as
quoted on a composite basis on the last business day of the twelve calendar
months immediately preceding the March l5 on which such vesting occurs or the
month in which such payment becomes payable;

(d) For purposes of determining the amount payable to a terminating participant
or to the estate of a deceased participant, the average of the reported closing
prices of the shares as quoted on a

                                        2

<PAGE>   3

composite basis on the last business day of the twelve calendar months
immediately preceding the month in which the participant's employment terminates
or the participant dies or the twelve consecutive calendar months including and
ending with that month if such termination or death occurs on or after the last
business day of that month;

(e) For purposes of determining the amount payable with respect to an award on
or after the maturity date thereof, the average of the reported closing prices
of the shares as quoted on a composite basis on the last business day of the
twelve calendar months immediately preceding such maturity date.

2.15 Change of Control - The occurrence of 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 Section, 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
Affiliated Company or (iv) any acquisition by any corporation pursuant to a
transaction that complies with clauses (A), (B) and (C) of Subsection (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 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;

(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

                                       3

<PAGE>   4

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

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

2.16 Change of Control Severance Program - With respect to any participant, the
Company's Change of Control Severance Program for Key Executives, Change of
Control Severance Program for Exempt Employees or Change of Control Severance
Program for Non-Exempt Employees under which such participant is eligible to
participate in the event of a Change of Control, or the individual Employment
Agreement between the participant and the Company the severance provisions of
which become operative in the event of a Change of Control.

3. ADMINISTRATION.

3.1 The Plan shall be administered by the Personnel 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
eligible employees of the Company and its subsidiaries shall be awarded basic
stock units; (b) to determine the times when basic stock units shall be awarded
and the number of basic stock units to be awarded to each participant; (c) to
determine the time or times when amounts may become payable with respect to
stock equivalent units within the limits provided in the Plan; (d) to prescribe
the form of the instruments evidencing any basic stock units awarded under the
Plan (which forms need not be identical); (e) to adopt, amend and rescind rules
and regulations for the administration of the Plan and the stock equivalent
units and for its own acts and proceedings; and (f) 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.

3.2 The maximum number of basic stock units which may be awarded under the Plan
is 41,400,000 subject to adjustment as determined by the Committee in event of a
dividend payable in shares, a stock split or a combination of shares. No basic
stock units may be awarded under the Plan after April 18, 2002.

4. PARTICIPATION.

                                       4

<PAGE>   5

4.1 The participants in the Plan shall be such key salaried employees as may be
selected from time to time by the Committee. Directors who are not employees
shall not be eligible. The employees to whom basic stock units are awarded at
any time may include employees to whom basic stock units were previously granted
under the Plan.

4.2 Awards of basic stock units shall be made from time to time by the Committee
in its discretion. In addition, with respect to any award, the Committee shall
have discretion to provide that all or any portion of that award shall be
contingent on achievement by the participant or by any unit or units of the
Company of any performance goal or goals over any period or periods of time
ending before March 15 of the third year following the date of the award.
Notwithstanding the above, the Committee may not award more than 100,000 basic
stock units to any participant in any calendar year subject to adjustment as
provided under Section 8.3.

5. INDIVIDUAL ACCOUNTS.

5.1 The Committee shall maintain a separate account for each award made under
the Plan. Each such account shall show the information necessary to compute the
participant's total credits in respect of each award, including the number of
basic stock units awarded to the participant, the value of an equal number of
shares on the date of the award, the amount credited to the account in respect
of dividends, as provided below, the number of dividend equivalent units
credited to the account and details as to any payments under the Plan which are
deducted from the account.

5.2 Whenever the Company pays a dividend (other than a stock dividend) upon its
outstanding common stock, there shall be credited to the separate account for
each award a dollar amount equal to the value of such dividend per share
multiplied by the number of stock equivalent units credited to the account on
the record date for such dividend. However, no such credits shall be made with
respect to any award after the maturity date thereof or after the date on which
the participant ceases to be an employee. As of March 15 in each year the
aggregate of the amounts so credited to the account since the prior March 15
shall be converted into a number of dividend equivalent units by dividing such
aggregate by the value of a share.

5.3 In the event of a dividend payable in shares, or in the event of a stock
split or combination of shares, the Committee shall make a corresponding change
in the number of basic stock units and dividend equivalent units then credited
to the account.

5.4 On the maturity date of an award, the total amount payable with respect to
such award shall become a fixed amount which will not change thereafter except
that the Committee may provide for the payment of interest beginning at maturity
on amounts whose payment is deferred to a date thereafter. Such fixed amount
shall be the total credits in respect of such award on such maturity date.

5.5 Whenever a payment is made under the Plan to a participant with respect to
any award, there shall be a corresponding reduction in the number of stock
equivalent units and other amounts credited to the participant's account in
respect of such award, or in the case of a payment after

                                       5

<PAGE>   6

maturity date or after the date on which the participant ceases to be an
employee, in the amount then credited to the account. A similar reduction shall
be made if a participant forfeits any portion of his interest in any awards.

6. PAYMENT.

6.1 Payments to a participant under the Plan may be made from time to time when
segments of his total credits in respect of an award become vested, or payment
may be deferred, all in accordance with rules established from time to time by
the Committee.

6.2.1 With respect to awards made on or before 12/31/83 fifteen percent of the
total credits in respect of an award shall become vested on March 15 of the
fourth calendar year following the calendar year of the award, an additional
fifteen percent thereof (or, in cases of vesting after one or more prior
payments under Section 6.3, the applicable vesting percentage thereof as
provided below) shall become vested on March 15 of the fifth, sixth, seventh,
eighth, and ninth calendar years following the calendar year of the award, and
any unvested balance thereof shall become vested on the maturity date of such
award.

6.2.2 With respect to awards made after 12/31/83 twenty percent of the total
credits in respect of an award shall become vested on March 15 of the third
calendar year following the calendar year of the award, an additional twenty
percent thereof (or, in cases of vesting after one or more prior payments under
Section 6.3, the applicable vesting percentage thereof as provided below) shall
become vested on March 15 of the fourth, fifth, and sixth calendar years
following the calendar year of the award, and any unvested balance thereof shall
become vested on the maturity date of such award.

6.2.3 Such vesting as described above shall occur only if the participant is an
employee on the date of vesting and has been an employee continuously since the
date of the award. The total credits in respect of all awards not at that time
subject to any contingency pursuant to Section 4.2 shall become fully vested if
the participant, while an employee, dies, incurs a disability, retires prior to
his normal retirement date with the consent of the Company and under conditions
approved by the Committee, or retires on or after his normal retirement date,
and the total amount payable with respect thereto shall become a fixed amount
which will not change thereafter, except that the Committee may provide for the
payment of interest on amounts whose payment is deferred to a date thereafter.
If the employment of a participant terminates as a result of the merger, sale or
other absorption or termination of operations of a subsidiary or a division, all
credits in respect of any such participant's award not at that time subject to
any contingency pursuant to Section 4.2 may become vested if the Committee, in
its sole discretion, determines such action to be in the best interests of the
Company, and the total amount payable with respect thereto shall become a fixed
amount which will not change thereafter, except that the Committee may provide
for the payment of interest on amounts whose payment is deferred to a date
thereafter. In connection with the determination of any participant's vested
rights under this Paragraph 6.2.3, the Committee may retroactively remove any
contingency in effect pursuant to Section 4.2. Notwithstanding the above, if a
participant retires prior to his normal retirement date but after the occurrence
of a

                                       6

<PAGE>   7

Change of Control, the consent of the Company shall not be required and all
credits and all contingencies with respect to the awards of such participant
shall become fully vested.

6.2.3.1 In the event of a Change of Control, all contingencies then in effect
pursuant to Section 4.2 shall be automatically removed and the total credits in
respect of all awards of a participant shall become fully vested upon the
participant's termination of employment within two years of the Change of
Control under circumstances entitling the participant to separation benefits
under the Change of Control Severance Program (or, in the case of a participant
whose designated home country is other than the United States, under
circumstances that would have entitled the participant to separation benefits
under the Change of Control Severance Program if such participant's designated
home country was the United States). The aggregate amount of such awards shall
be payable in accordance with the participant's payment election made in
accordance with Section 6.3, unless prior to the Change of Control the
participant had provided in such election for its revocation in the event of a
Change of Control in which event payment of such awards shall be made as soon as
practicable following the Change of Control.

6.2.3.2 Notwithstanding any other provision of this Plan, (a) upon an
employer-initiated termination of employment of a participant pursuant to the
Restructuring Plan approved by the Board of Directors of the Company at its
meeting on December 18, 1986, or the Reorganization Plan approved by the Board
of Directors of the Company at its meeting on December 14, 1989, the Realignment
Plan and Parker Integration Plan approved by the Board of Directors at its
meeting held on January 7, 1994 or the Realignment Program approved by the Board
of Directors at its meeting held on September 28, 1998, or (b) upon the sale or
other disposition of the unit, division or subsidiary in which a participant is
employed pursuant to the Restructuring Plan approved by the Board of Directors
of the Company at its meeting on December 18, 1986, the Reorganization Plan
approved by the Board of Directors of the Company at its meeting on December 14,
1989 or the Reorganization and Realignment Program approved by the Board of
Directors at its meeting held on September 28, 1998, which sale or other
disposition results in the participant no longer being employed by the Company
or any of its subsidiaries, or (c) upon the sale of the Jafra Cosmetics business
pursuant to a certain Acquisition Agreement dated January 26, 1998 ("Jafra
Sale") where a participant either (i) continues to be employed by Jafra
immediately following the Jafra Sale or (ii) is terminated from the employment
of the Company or any of its subsidiaries as a direct result of the Jafra Sale,
all contingencies then in effect pursuant to Section 4.2 shall be automatically
removed except with respect to contingencies which expire on February 19, 1987.
Further, in such event, the total credits in respect of all awards of a
participant for which no contingencies remain in effect shall become fully
vested and the amount of such awards shall be fixed and payable. With respect to
awards or segments of awards which become vested under this Subparagraph or any
other award or segment thereof which becomes payable by reason of the
participant's termination of employment, the participant may elect to receive
such awards upon termination of employment or may, prior to the date
participant's employment with the Company or any subsidiary terminates, elect to
defer such award in accordance with the provisions of Paragraph 6.2.3 and rules
established from time to time by the Committee. Notwithstanding the above, the
removal of contingencies and the granting of vesting and deferral rights
provided for in this Subparagraph 6.2.3.2 shall serve as partial consideration
for a settlement of all claims and disputes which the participant may have
against the Company, its subsidiaries, employees and

                                       7

<PAGE>   8

agents and shall be subject to the execution by the participant of a release and
settlement agreement in a form to be prescribed by the Committee.

6.2.4 In order to make proper adjustment for any previous payments under Section
6.3, the applicable vesting percentage to be used in computing vested segments
under the foregoing provisions of this Section 6.2 and in computing the amount
of a payment under Section 6.3 or Section 6.4 shall be determined as follows:

(a) In computing such vested segment or the amount or a payment under Section
6.3 for awards made prior to 12/31/83, the applicable vesting percentage to be
applied to the total credits in respect of a particular award shall be equal in
value to a fraction whose numerator is fifteen (or ten in the case of the final
vested installment) and whose denominator is (i) 100 minus (ii) fifteen
multiplied by the number of vested segments previously paid to the participant
under Section 6.3. Payment of each vested segment shall be considered a separate
payment.

(b) In the case of a payment under Section 6.4 for awards made prior to
12/31/83, the applicable vesting percentage to be applied to the total credits
in respect of a particular award shall be equal in value to a fraction whose
numerator is (i) fifteen multiplied by the number of segments of the award which
have become vested in accordance with the foregoing provisions prior to the date
on which the participant ceases to be an employee (but not more than 100) minus
(ii) fifteen multiplied by the number of vested segments previously paid to the
participant under Section 6.3, and whose denominator is 100 minus (ii) above.

(c) In computing such vested segment or the amount or a payment under Section
6.3 for awards made after 12/31/83, the applicable vesting percentage to be
applied to the total credits in respect of a particular award shall be equal in
value to a fraction whose numerator is twenty and whose denominator is (i) 100
minus (ii) twenty multiplied by the number of vested segments previously paid to
the participant under Section 6.3. Payment of each vested segment shall be
considered a separate payment.

(d) In the case of a payment under Section 6.4 for awards made after 12/31/83,
the applicable vesting percentage to be applied to the total credits in respect
of a particular award shall be equal in value to a fraction whose numerator is
(i) twenty multiplied by the number of segments of the award which have become
vested in accordance with the foregoing provisions prior to the date on which
the participant ceases to be an employee (but not more than 100) minus (ii)
twenty multiplied by the number of vested segments previously paid to the
participant under Section 6.3, and whose denominator is 100 minus (ii) above.

6.3 Prior to any date on which a participant is to acquire a vested interest or
additional vested interest in the total credits in respect of an award, the
participant shall make an election, at the time and in a manner specified by the
Committee, as to the time when payment is to be made of the segment or segments
of such total credits which may become vested on such date. The participant may
elect (a) to receive payment within a reasonable time after such date, or (b) to
defer payment in accordance with rules established from time to time by the
Committee, and in the absence of an affirmative deferral election shall be
deemed to have elected payment in accordance with the

                                       8

<PAGE>   9

preceding clause (a). When making such deferral election, the participant may
provide for the revocation of all such deferral elections in the event of a
Change of Control and for the payment by the Company of all such deferred
amounts as soon as practicable following the Change of Control.

6.4 If a participant ceases to be an employee for any reason not specified in
Section 6.2, his vested interest in respect of each award shall thereupon become
a fixed amount which will not change thereafter. Such fixed amounts shall be
determined by multiplying the total credits in respect of each award on the date
of termination of employment by the applicable vesting percentage. The
participant shall thereupon forfeit his interest in any amounts then credited to
his account to the extent his interest has not become vested. Payment of vested
interests shall be made in accordance with rules established from time to time
by the Committee.

6.5 If a participant dies prior to termination of his employment, an amount
equal to his total credits in respect of all awards not subject to any
contingency pursuant to Section 4.2 shall be paid to his executor or
administrator or as otherwise provided by law valued as of the date of death.

6.6 All payments will be made in cash and will be subject to any required tax
withholdings.

7. AMENDMENT AND TERMINATION.

7.1 The Board of Directors of the Company, or the Personnel Committee of the
Board of Directors if and to the extent authorized, may at any time amend the
Plan for the purposes of satisfying the requirements of any changes in
applicable laws or regulations or for any other purpose which may be permitted
by law, except that neither the Board of Directors nor the Personnel Committee
of the Board of Directors may, without the approval of the stockholders of the
Company, increase the maximum number of basic stock units that may be awarded
under the Plan or increase the time within which basic stock units may be
awarded, as provided in Section 3.2, or extend the maturity date of an award
beyond March 15 of the tenth calendar year following the calendar year in which
the award was made. Notwithstanding the above, in the event of a Change of
Control, no amendment to the Plan which provides for prospective Plan benefits
and other terms and conditions any less favorable to Plan participants than
those which existed prior to the amendment shall be effective unless it provides
that all contingencies which are then in existence be removed and all awards
which are unvested prior to such amendment shall become immediately vested and
payable in accordance with Subparagraph 6.2.3.1.

7.2 The Board of Directors of the Company may terminate the Plan at any time
except that after a Change of Control such Plan may not be terminated without
providing that all contingencies then in existence shall be removed and all
unvested awards shall become immediately vested and payable in accordance with
Subparagraph 6.2.3.1.

7.3 No such amendment or termination shall adversely affect the rights of any
participant (without his consent) under any award previously made or, after the
happening of any event in connection with or in anticipation of a Change of
Control that actually occurs, deprive a participant of a benefit or right which
becomes operative upon a Change of Control.

                                       9

<PAGE>   10

8. MISCELLANEOUS.

8.1 The interest under the Plan of any participant, his heirs or legatees shall
not be alienable by the participant, his heirs or legatees by assignment or any
other method and shall not be subject to being taken by his creditors by any
process whatsoever.

8.2 The Plan shall not be deemed to give any participant or employee the right
to be retained in the employ of the Company or any subsidiary nor shall the Plan
interfere with the right of the Company or any subsidiary to discharge any
employee at any time.

8.3 In the event of a stock dividend, split-up or combinations of shares,
recapitalization for 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 used as a basis for granting awards under the
Plan, the units then outstanding or to be granted thereunder, the maximum number
of basic stock units which may be granted, the unit value 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 complete liquidation of the Company, all outstanding basic stock units and
dividend equivalent units shall thereafter accrue no further value, provided
that at least twenty days prior to the effective date of any such consolidation
or merger, the Board of Directors shall either (a) make all outstanding basic
units and dividend equivalent units immediately vested and payable, or (b)
arrange to have the surviving corporation grant replacement units to the
participants.

DECEMBER 1999

                                       10

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