The Procter & Gamble 1993
Non-Employee Directors’ Stock Plan
THE PROCTER & GAMBLE 1993
NON-EMPLOYEE DIRECTORS’
STOCK PLAN
(as amended September 10, 2002)
The purpose of The
Procter & Gamble 1993 Non-Employee Directors’ Stock Plan
(hereinafter referred to as the “Plan”) is to
strengthen the alignment of interests between non-employee
Directors (hereinafter referred to as “Participants”)
and the shareholders of The Procter & Gamble Company
(hereinafter referred to as the “Company”) through the
increased ownership of shares of the Company’s Common Stock.
This will be accomplished by allowing Participants to elect
voluntarily to convert a portion or all of their cash fees for
services as a Director into Common Stock, by granting Participants
a fixed value of shares of Common Stock restricted until retirement
(hereinafter referred to as “Retirement Shares”) and by
granting Participants non-qualified options to purchase shares of
Common Stock (hereinafter referred to as “Stock
Options”).
ARTICLE B
— Administration.
1. The Plan
shall be administered by the Compensation Committee (hereinafter
referred to as the “Committee”) of the Board of
Directors of the Company (hereinafter referred to as the
“Board”), or such other committee as may be designated
by the Board. The Committee shall consist of not less 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, 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.
2. It shall
be the duty of the Committee to administer this Plan in accordance
with its provisions and to make such recommendations of amendments
or otherwise as it deems necessary or appropriate. A decision by a
majority of the Committee shall govern all actions of the
Committee.
3. Subject to
the express provisions of this Plan, the Committee shall have
authority to allow Participants the right to elect to receive fees
for services as a director in either cash or an equivalent amount
of whole shares of Common Stock of the Company, or partly in cash
and partly in whole shares of the Common Stock of the Company,
subject to such conditions or restrictions, if any, as the
Committee may determine. The Committee also has the authority to
make all other determinations it deems necessary or advisable for
administering this Plan.
4. The
Committee may establish from time to time such regulations,
provisions, and procedures within the terms of this Plan as, in its
opinion, may be advisable in the administration of this
Plan.
5. The
Committee may designate the Secretary of the Company or other
employees of the Company to assist the Committee in the
administration of this Plan and may grant authority to such persons
to execute documents on behalf of the Committee.
ARTICLE C
— Participation.
Participation in
the Plan shall be limited to all non-employee Directors of the
Company.
ARTICLE D
— Limitation on Number of Shares for the Plan.
The total number
of shares of Common Stock of the Company that may be awarded each
year shall not exceed 50,000 shares.
ARTICLE E
— Shares Subject to Use Under the Plan.
Shares of Common
Stock to be awarded under the terms of this Plan shall be treasury
shares.
ARTICLE F
— Retirement Shares
1. On the first
business day in January, each Participant shall receive Retirement
Shares with a fair market value of $45,000 on the date of
grant.
2. All shares
awarded under this Article shall be valued as set forth in
Article I.
ARTICLE G
— Stock Options.
1. The
Committee may, from time to time, grant Participants a Stock Option
to purchase shares of Common Stock having an exercise price of one
hundred percent (100%) of the fair market value of the Common Stock
on the date of the grant.
2. The Stock
Options shall have a term of ten (10) years from the date of
grant, subject to earlier termination as provided herein, and shall
be exercisable 100% three (3) years from the date of grant,
except in the case of death, in which case the Stock Options shall
be immediately exercisable.
3. Stock
Options are not transferable other than by will or by the laws of
descent and distribution. Legatees, distributees and duly appointed
executors and administrators of the estate of a deceased
Participant shall have the right to exercise such Stock Options at
any time prior to the expiration date of the Stock
Options.
4. If a
Participant ceases to be a Director while holding unexercised Stock
Options, such stock options are then void, except in the case of
(i) death, (ii) disability,
(iii) retirement at the end of a term,
(iv) retirement after attaining the age of sixty-nine (69),
(v) resignation from the Board following the
Participant’s retirement from a principal employer under the
terms of an appropriate retirement plan or (vi) resignation
from the Board for reasons of the antitrust laws or the conflict of
interest, corporate governance or continued service
policies.
5. Upon the
exercise of a Stock Option, payment in full of the exercise price
shall be made by the Participant. The exercise price may be paid
for by the Participant either in cash, shares of the Common Stock
of the Company to be valued at their fair market value on the date
of exercise, or a combination thereof.
In the event of
any future reorganization, recapitalization, stock split, stock
dividend, combination of shares, merger, consolidation, rights
offering, share exchange, reclassification, distribution, spin-off
or other change affecting the corporate structure, capitalization
or Common Stock of the Company occuring after the date of approval
of the Plan by the Company’s shareholders, (i) the
amount of shares authorized to be issued under the Plan
and
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