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The following table summarizes stock option activity during 2002, 2001 and 2000: 

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Stock options outstanding at June 30, 2002 were in the following exercise price ranges: 

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Stock options exercisable at June 30, 2002 were in the following exercise price ranges: Exercisable Options 

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As a component of its treasury share repurchase program, the Company generally repurchases common shares to fund the stock options granted. Additionally, the Company enters into equity put options on its common stock in order to reduce the cash outlay for share repurchases. These agreements typically mature in six months and can be settled on a physical or net-share basis at the Company’s option. The premium 

received from the sale of the instruments is credited to equity. 

The put options entered into during 2002 were equivalent to three million shares at approximately $81 per share. The last of the equity put option contracts will expire in the second quarter of 2003. The 2001 options were equivalent to one million common shares, at approximate- ly $74 per share and the options entered into in 2000 were equivalent to 12 million common shares, at prices ranging from $60 to $71 per share. The 2001 and 2000 options have expired mostly unexercised. Over the past three years, $96 of premiums received have been credited to equity. 

In limited cases, the Company also issues stock appreciation rights, generally in countries where stock options are not permitted by local governments. The obligations and associated compensation expense are adjusted for changes in intrinsic value. The impact of these adjustments is insignificant. 

## Note 9 Employee Stock Ownership Plan 

The Company maintains The Procter & Gamble Profit Sharing Trust and Employee Stock Ownership Plan (ESOP) to provide funding for certain employee benefits. 

The ESOP borrowed $1,000 in 1989 and the proceeds were used to purchase Series A ESOP Convertible Class A Preferred Stock to fund a portion of the defined contribution plan. Principal and interest requirements are $117 per year, paid by the trust from dividends on the preferred shares and from cash contributions and advances from the Company. Each share is convertible at the option of the holder into one share of the Company’s common stock. The liquidation value is $13.64 per share. 

In 1991, the ESOP borrowed an additional $1,000. The proceeds were used to purchase Series B ESOP Convertible Class A Preferred Stock to fund a portion of retiree health care benefits. These shares are considered plan assets of the other retiree benefits plan as discussed in Note 10. Debt service requirements are $94 per year, funded by preferred stock dividends and cash contributions from the Company. Each share is convertible at the option of the holder into one share of the Company’s common stock. The liquidation value is $25.92 per share. 

