Exhibit (99.4)
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Directors and Officers (Third) Excess Liability Policy
STARR EXCESS
Liability Insurance Company, Ltd.
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29 Richmond Road, Pembroke HM 08, Hamilton, Bermuda
EXCESS DIRECTORS AND OFFICERS INSURANCE POLICY
NOTICE: EXCEPT TO SUCH EXTENT AS MAY OTHERWISE BE PROVIDED HEREIN, THE COVERAGE
OF THIS POLICY IS LIMITED GENERALLY TO LIABILITY FOR ONLY THOSE CLAIMS THAT ARE
FIRST MADE AGAINST THE INSUREDS AND REPORTED TO THE INSURER DURING THE POLICY
PERIOD. PLEASE READ THE POLICY CAREFULLY AND DISCUSS THE COVERAGE THEREUNDER
WITH YOUR INSURANCE AGENT OR BROKER.
NOTICE: THE LIMIT OF LIABILITY AVAILABLE TO PAY JUDGMENTS OR SETTLEMENTS SHALL
BE REDUCED BY AMOUNTS INCURRED FOR LEGAL DEFENSE. AMOUNTS INCURRED FOR LEGAL
DEFENSE SHALL BE APPLIED AGAINST THE RETENTION AMOUNT.
NOTICE: THE INSURER DOES NOT ASSUME ANY DUTY TO DEFEND.
DECLARATIONS POLICY #: 700090
ITEM 1. NAMED CORPORATION: The Procter and Gamble Company
MAILING ADDRESS: One Procter & Gamble Plaza
Cincinnati
Ohio 45202-3314
STATE OF INCORPORATION
OF THE NAMED CORPORATION: Ohio
ITEM 2. FOLLOWED POLICY:
INSURER: CODA POLICY NO: PG-106C
ITEM 3. POLICY PERIOD: From: June 30, 1996 To: June 30, 1997
(12:01 A.M. standard time at the address stated in Item 1.)
ITEM 4. LIMIT OF LIABILITY: $50,000,000 aggregate for coverages
combined (including Defense Costs)
EXCESS OF TOTAL UNDERLYING LIMITS OF: $95,000,000
ITEM 5. RETENTIONS:
A. $N/A per Director or Officer each Loss, but not exceeding
B. $N/A in the aggregate each Loss
1 of 2
Date of Issuance - September 16, 1996
SELIC DOO(6/94)DEC
(sedoopol)
DECLARATIONS POLICY NO.: 700090
ITEM 6. SCHEDULE OF PRIMARY AND UNDERLYING EXCESS POLICIES:
POLICY POLICY
INSURER NUMBER LIMITS PERIOD
PRIMARY POLICY: CODA PG-106C $25,000,000 6/30/96 to 6/30/99
EXCESS POLICIES: X.L. XLD+O-00364-96 $25,000,000 6/30/96 to 6/30/97
ACE PG-8117D $45,000,000 6/30/96 to 6/30/97
ITEM 7. PREMIUM: $125,000
ITEM 8. A. DISCOVERY PERIOD PREMIUM: 100% of
Premium indicated in Item 7.
B. DISCOVERY PERIOD: One Year
ITEM 9. NOTICE OF CANCELLATION PERIOD: 60 days.
ITEM 10. ADDRESS OF INSURER FOR ALL NOTICES UNDER THIS POLICY:
STARR EXCESS LIABILITY INSURANCE COMPANY, LTD.
P.O. BOX HM 152
HAMILTON, HM AX
BERMUDA
ITEM 11. POLICY FORM: EXCESS DIRECTORS AND OFFICERS INSURANCE
POLICY SELIC DOO(6/94)
ENDORSEMENT(S): 1-2
BROKER: Park International Limited
44 Church Street
P.O. Box HM 2064
Hamilton HM HX
Bermuda
/s/ DAVID F. ALLEN
Authorized Representative
2 of 2
EXCESS DIRECTORS AND OFFICERS INSURANCE POLICY
In consideration of the payment of the premium, and in reliance upon the
statements made to the Insurer by application forming a part hereof and its
attachments and the material incorporated therein, STARR EXCESS LIABILITY
INSURANCE COMPANY, LTD. herein called the "Insurer", agrees as follows:
I. INSURING AGREEMENTS
This policy shall provide the Insured(s) with Excess Directors and Officers
Insurance coverage in accordance with the same warranties, terms, conditions,
exclusions and limitations of the Followed Policy identified in Item 2 of the
Declarations as they were in existence on the inception date of this policy
(except as regards the premium, the amount and limits of liability and the
policy period) subject to:
(a) the warranties, terms, conditions, exclusions and limitations of this
policy including any endorsement attached hereto, and
(b) provided always that this policy shall, in no event and notwithstanding
any other provision, provide coverage broader than that provided by the
Followed Policy unless such broader coverage is specifically agreed to by
the Insurer and identified as broader coverage in a written endorsement
attached hereto.
II. DEFINITIONS
(a) The term "Director(s) or Officer(s)" and the term "Insured(s)" shall
mean those directors, officers and other natural persons (if any) insured
under the Followed Policy.
(b) The term "Company" shall mean the Named Corporation designated in Item
1 of the Declarations.
(c) The term "Loss" shall have the same meaning in this policy as is
attributed to it in the Followed Policy except that the term "Loss" shall
in no event include civil or criminal fines or penalties, punitive or
exemplary damages, the multiplied portion of multiplied damages or any
amount for which the Insureds are not financially liable or which are
without legal recourse to the Insureds, or matters which may be deemed
uninsurable under the law pursuant to which this policy shall be construed.
(d) "Policy Period" shall mean the period of time from the inception date
shown in Item 3 of the Declarations to the earlier of the expiration date
shown in Item 3 of the Declarations or the effective date of cancellation
of this policy.
(e) The term "Underlying Policies" shall mean the Primary and Underlying
Excess Policies set forth in Item 6 of the Declarations. The term
"Underlying Insurer(s)" shall mean the insurer(s) of the Underlying
Policies The term "Underlying Limit" shall mean an amount equal to the
aggregate of all the limits of the Underlying Policies combined (excess of
their retentions).
(f) The term "Wrongful Act" and "Subsidiary" shall have the same meanings
in this policy as are attributed to them in the Followed Policy.
III. LIMIT OF LIABILITY
The limit of liability stated in Item 4 of the Declarations is the limit of the
Insurer's liability for all Loss under all Coverages combined, arising out of
all claims first made against the Insureds and reported to the Insurer during
the Policy Period and the Discovery period (if applicable); however, the limit
of liability for the Discovery Period shall be part of, and not in addition to,
the limit of liability for the Policy Period. Further ,any claim which is made
subsequent to the Policy Period or Discovery Period (if applicable) which
pursuant to Clause V(b) is considered made during the Policy Period or Discovery
Period shall also be subject to the one aggregate limit of liability stated in
item 4 of the Declarations.
It is expressly agreed that liability for any covered Loss with respect to
claims first made and reported during the Policy period shall attach to the
Insurer only after the Underlying Limit, and the Insureds shall have paid or
been held liable to pay the full amount of the Underlying Limit, and the
Insureds shall have paid or been held liable to pay the full amount of the
applicable Retention amount for such Policy Period. In the event and only in the
event of the reduction or exhaustion of the Underlying Limit by reason of the
Underlying Insurers, and/or the Insureds paying or being held liable to pay Loss
otherwise covered hereunder, this policy shall: (i) in the event of reduction,
pay excess of the reduced Underlying Limit, and (ii) in the event of exhaustion,
continue in force as primary insurance; provided always that in the latter event
this policy shall only pay excess of the Retention amounts set forth in Item 5
of the Declarations, which Retention amount shall be applied to any subsequent
Loss in the same manner as specified in the Followed Policy; provided however,
that the Retention amounts set forth in Item 5 shall not apply if the retention
amount of any Underlying Policy has been applied to such Loss.
This policy shall pay only in the event of reduction or exhaustion of the
Underlying Limit as described above and shall not drop down for any reason
including, but not limited to, uncollectability (in whole or in part) of the
Underlying Limit, existence of a sub-limit of liability in any Underlying
Policy, or any Excess Policy containing terms and conditions different from the
Followed Policy. The risk of uncollectability of such underlying insurance (in
whole or in part) whether because of financial impairment or insolvency of an
Underlying Insurer, the application of any underlying sub-limit of liability or
differing terms and conditions or for any other reason is expressly retained by
the Insureds and is not in any way or under any circumstances insured or assumed
by the Insurer.
IV. UNDERLYING LIMITS
It is a condition of this policy that the Underlying Policies shall be
maintained in full effect with solvent insurers during the Policy Period except
for any reduction or exhaustion of the aggregate limits contained therein by
reason of Loss paid thereunder (as provided for in Clause III above). Failure to
comply with the foregoing shall not invalidate this policy, but in the event of
such failure, the Insurer shall be liable only to the extent that it would have
been liable had the Insureds and the company complied with such condition.
Unless the Insurer otherwise agrees in writing, this policy shall immediately
and automatically terminate if the Company fails to notify the Insurer as set
forth in Clause V(c) of this policy that any of the Underlying Policies has
ceased to be in full effect. If such notification is made, then this policy
shall continue in effect but the Insured(s) (or an insurer providing replacement
coverage if such replacement coverage is obtained) shall be liable for the
amount of the underlying limit of such ceased Underlying Policy and the Insurer
shall be liable only to the extent that it would have been liable had the
Underlying Policy not ceased. Unless the Insurer otherwise agrees in writing,
this policy shall automatically terminate thirty (30) days following the date
any Underlying Insurer becomes subject to a receivership, liquidation,
dissolution, rehabilitation or any similar proceeding or is taken over by any
regulatory authority unless the Named Corporation obtains replacement coverage
for such Underlying Policy within such thirty (30) day period.
If during the Policy Period or any Discovery Period the terms, conditions,
exclusions or limitations of the Followed Policy are changed in any manner, the
Company or the Insureds shall as a condition precedent to the Insureds rights
under this policy give to the Insurer as soon as practicable written notice of
the full particulars thereof. This policy shall become subject to any such
changes upon the effective date of the changes in the Followed Policy, but only
upon the condition that the Insurer agrees to follow such changes by written
endorsement attached hereto and the Named Corporation agrees to any additional
premium and/or amendment of the provisions of this policy required by the
Insurer relating to such changes. Further, such new coverage is conditioned upon
the Named Corporation paying when due any additional premium required by the
Insurer relating to such changes.
V. NOTICES AND CLAIM REPORTING PROVISIONS
(a) The Company or the Insureds shall, as a condition precedent to the
obligations of the Insurer under this policy, give written notice to the
Insurer at the address indicated in Item 10 of the Declarations and all
Underlying Insurers as soon as practicable during the Policy Period, or
during the Discovery Period (if applicable), of any claim made against
the Insureds.
(b) If during the Policy period or during the Discovery Period (if
applicable) (i) written notice of a claim has been given to the Insurer
pursuant to Clause V(a) above, or (ii) to the extent permitted by the terms
and conditions of the Followed Policy, written notice of circumstances that
might reasonably be expected to give rise to a claim, has been given to the
Insurer and all Underlying Insurers, then any claim which is subsequently
made against the Insureds and reported to the Insurer and all Underlying
Insurers alleging, arising out of, based upon or attributable to the facts
alleged in the claim or circumstances of which such notice has been given,
or alleging any Wrongful Act which is the same as or related to any
Wrongful Act alleged in the claim or circumstances of which such notice has
been given, shall be considered made at the time such claim or
circumstances has been given to the Insurer.
(c) The Company or the Insureds shall, as a condition precedent to the
obligations of the Insurer under this policy, give written notice to the
Insurer of the following events as soon as practicable but in no event
later than thirty (30) days of an Insured or the Company becoming aware of
the event:
(i) The cancellation, nonrenewal of any Underlying Policy or any
Underlying Policy otherwise ceases to be in effect or uncollectible
(in part or in whole); or
(ii) Any insurer or any Underlying Policy becoming subject to a
receivership, liquidation, dissolution, rehabilitation or any similar
proceeding or being taken over by any regulatory authority; or
(iii) The Named Corporation consolidating with or merging into, or selling
all or substantially all of its assets to, any other person or entity
or group of persons and/or entities acting in concert; or
(iv) Any person or entity or group of persons and/or entities acting in
concert acquiring an amount of the outstanding securities
representing more than 50% of the voting power for the election of
Directors of the Named Corporation, or acquiring the voting rights of
such an amount of such securities.
VI. CLAIM PARTICIPATION
The Insurer shall have the right, in its sole discretion, but not the obligation
to effectively associate with the Company and the Insureds in the defense and
settlement of any claim that appears to the Insurer to be reasonably likely to
involve the Insurer, including but not limited to effectively associating in the
negotiation of a settlement. The Insureds shall defend and contest any such
claim. The Company and the Insureds shall give the Insurer full cooperation and
such information as it may reasonably require. The failure of the Insurer to
exercise any right under this paragraph at any point in a claim shall not act as
a waive or limit the right of the Insurer in any manner to exercise such rights
at any other point in a claim including the right to effectively associate in
the negotiation of a settlement.
The Insurer does not under this policy assume any duty to defend. The Insureds
shall not admit or assume any liability, enter into any settlement agreement,
stipulate to any judgment or incur any Defense Costs without the prior written
consent of the Insurer. Only those settlements, stipulated judgments and Defense
Costs which have been consented to by the Insurer shall be recoverable as Loss
under the terms of this policy. The Insurer's consent shall not be unreasonably
withheld, provided that the Insurer shall be entitled to effectively associate
in the defense and the negotiation of any settlement of any claim in order to
reach a decision as to reasonableness.
VII. DISCOVERY CLAUSE
If the Insurer shall cancel or refuse to renew this policy the Named Corporation
shall have the right, upon payment of the additional percentage set forth in
Item 8A of the Declarations of the full annual premium, to the period set forth
in Item 8B of the Declarations following the effective date of such cancellation
or nonrenewal (herein referred to as the Discovery Period) in which to give
written notice to the Insurer of claims first made against the Insureds during
said period for any Wrongful Act occurring prior to the end of the Policy Period
and otherwise covered by this policy. As used herein, "full annual premium"
means the premium level in effect immediately prior to the end of the Policy
Period.
The rights contained in this clause shall terminate, however, unless written
notice of such election together with the additional premium due is received by
the Insurer within the time period and in the manner set forth in the Followed
Policy. The Discovery Period is not available unless the Named Corporation has
elected the Discovery Period (or Extended Reporting Period) in all Underlying
Policies which have been canceled or non-renewed by their Underlying Insurers.
The additional premium for the Discovery period shall be fully earned at the
inception of the Discovery Period. The Discovery Period is not cancelable.
The offer by the Insurer of renewal terms, conditions, limits of liability
and/or premiums different from those of the expiring policy shall not constitute
refusal to renew.
VIII. CANCELLATION CLAUSE
This policy may be canceled by the Named Corporation only by mailing written
prior notice to the Insurer or by surrender of this policy to the Insurer or its
authorized agent at the address set forth in Item 10 of the Declarations and
within the time period and in the manner set forth in the Followed Policy. This
policy may also be canceled by or on behalf of the Insurer by delivering to the
Named Corporation or by mailing to the Named Corporation, by registered,
certified, or other first class mail, at the Named Corporation's address set
forth in the Declarations, written notice stating when, not less than the period
set forth in Item 9 of the Declarations, thereafter the cancellation shall be
effective. The mailing of such notice as aforesaid shall be sufficient proof of
notice. The Policy Period terminates at the date and hour specified in such
notice, or at the date and time of surrender.
If this policy shall be canceled by the Named Corporation, the Insurer shall
retain the customary short rate proportion of the premium hereon.
If this policy shall be canceled by the Insurer, the Insurer shall retain the
pro rata proportion of the premium hereon.
Payment or tender of any unearned premium by the Insurer shall not be a
condition precedent to the effectiveness of cancellation but such payment shall
be made as soon as practicable.
If the period of limitation relating to the giving of notice is prohibited or
made void by any law controlling the construction thereof, such period shall be
deemed to be amended so as to be equal to the minimum period of limitation
permitted by such law.
IX. OTHER CONDITIONS
(a) SUBROGATION
In the event of any payment under this policy, the Insurer shall be
subrogated to the extent of such payment to all the Insureds' rights of
recovery therefor, and the Company and the Insureds shall execute all
papers required and shall do everything that may be necessary to secure
such rights including the execution of such documents necessary to enable
the Insurer effectively to bring suit in the name of the Insureds.
(b) OTHER INSURANCE
Such insurance as is provided by this policy shall apply only as
excess over any other valid and collectible insurance. Provided, however,
that nothing in the foregoing shall be construed to compel the Insurer to
drop down in the event of the invalidity or uncollectibility of any
Underlying Policy.
(c) NOTICE AND AUTHORITY
It is agreed that the Named Corporation shall act on behalf of the
Insureds with respect to the giving and receiving of notice of claim or
cancellation, the payment of premiums and the receiving of any return
premiums that may become due under this policy, the receipt and
acceptance of any endorsements issued to form a part of this policy and
the exercising or declining to exercise any right to a Discovery Period.
(d) ASSIGNMENT
This policy and any and all rights hereunder are not assignable without
the written consent of the Insurer.
(e) PREMIUM
The premium under this policy is a flat premium and is not subject to
adjustment except as otherwise provided herein.
(f) CHANGES
Notice to or knowledge possessed by any person shall not effect a waiver
of or a change in any part of this policy or stop the Insurer from
asserting any right under the terms of this policy; nor shall the terms
of this policy be waived or changed, except by endorsement issued to
form a part hereof, signed by the Insurer or its authorized
representative.
(g) CURRENCY
The premiums and any Loss under this policy are payable in United States
currency.
(h) ARBITRATION
Any dispute arising under or relating to this policy, or the breach
thereof, shall be finally and fully determined in Hamilton, Bermuda
under the provisions of the Bermuda Arbitration Act of 1986, as amended
and supplemented, by an Arbitration Board composed of three arbitrators
who shall be disinterested and active or retired business executives
having knowledge relevant to the matters in dispute, and who shall be
selected for each controversy as follows:
Either party to the dispute, once a claim or demand on its part has been
denied or remains unsatisfied for a period of twenty (20) calendar days
by the other party, may notify the other party of its desire to
arbitrate the matter in dispute and at the time of such notification the
party desiring arbitration shall notify the other party of the name of
the arbitrator selected by it. The other party who has been so notified
shall within ten (10) calendar days thereafter select an arbitrator and
notify the party desiring arbitration o the name of such second
arbitrator. If the party notified of a desire for arbitration shall fail
or refuse to nominate the second arbitrator within ten (10) calendar
days following the receipt of such notification, the party who first
served notice of a desire to arbitrate will, within an additional period
of ten (10) calendar days, apply to the Supreme Court of Bermuda for the
appointment of the second arbitrator and in such a case the arbitrator
appointed by the Supreme Court of Bermuda shall be deemed to have been
nominated by the party who failed to select the second arbitrator. The
two arbitrators, chosen as above provided, shall within ten (10)
calendar days after the appointment of the second arbitrator choose a
third arbitrator. Upon acceptance of the appointment by said third
arbitrator, the Arbitration Board for he controversy in question shall
be deemed fixed.
The Arbitration Board shall fix, by a notice in writing to the parties
involved, a reasonable time and place for the hearing and may in said
written notice or at the time of the commencement of said hearing, at
the option of said Arbitration Board, prescribe reasonable rules and
regulations governing the course and conduct of said hearing.
The Board, shall, within ninety (90) calendar days following the
conclusion of the hearing, render decision on the matter or matters in
controversy in writing and shall cause a copy thereof to be served on
all parties thereto. In case the Board fails to reach a unanimous
decision, the decision of the majority of the members of the Board shall
be deemed to be the decision of the Board.
Each party shall bear the expense of its own arbitrator. The remaining
cost of the arbitration shall be borne equally by the parties to such
arbitration.
All awards made by the Arbitration Board shall be final and no right of
appeal shall lie from any award rendered by the Arbitration Board. The
parties agree that the Supreme Court of Bermuda: (i0 shall not grant
leave to appeal any award based upon a question of law arising out of
the award; (ii) shall not grant leave to make an application with
respect to an award; and (iii) shall not assume jurisdiction upon any
application by a party to determine any issue of law arising in the
course of the arbitration proceeding, including but not limited to
whether a party has been guilty of fraud.
All awards made by the Arbitration Board may be enforced in the same
manner as a judgment or order from the Supreme Court of Bermuda and
judgment may be entered pursuant to the terms of the award by leave from
the Supreme Court of Bermuda.
No person or organization shall have any right under this policy to join
the Insurer as a party to any action against the Insureds or the company
to determine the Insureds liability, nor shall the Insurer be impleaded
by the Insureds or the Company or their legal representatives. The
Insurer and the Insureds agree that in the event that claims for
indemnity or contribution are asserted in any action or proceeding
against the Insurer by any of the Insureds other insurers in a
jurisdiction or forum other than that set forth in this clause, the
Insureds will in good faith take all reasonable steps requested by the
Insurer to assist the Insurer in obtaining a dismissal of these claims
(other than on the merits). The Insureds and the Company will, without
limitation, undertake to the court or other tribunal to reduce any
judgment or award against such other insurers to the extent that the
court or tribunal determines that the Insurer would have been liable to
such insurers for indemnity or contribution pursuant to this policy. The
Insureds shall be entitled to assert claims against the Insurer for
coverage under this policy including, without limitation, for amounts by
which the Insureds reduced judgment against such other insurers in
respect of such claims for indemnity or contribution, in an arbitration
between the Insurer and the Insureds pursuant to this clause; provided,
however, that the Insurer in such arbitration in respect of such
reduction of any judgment shall be entitled to raise any defenses under
this policy and any other defenses (other than jurisdictional defenses)
as it would have been entitled to raise in the action or proceeding with
such insurers.
(i) CHOICE OF LAW
This policy shall be construed and enforced in accordance with the
internal laws of the State of New York (with the exception of the
procedural law set required by Clause IX(G), which shall be construed
and enforced in accordance with the laws of Bermuda), provided, however,
that, notwithstanding any legal principals to the contrary, the
warranties, terms, conditions, exclusions and limitations of this policy
are to be construed in an evenhanded fashion between the Insureds, the
Company and the Insurer. Without limitation, where the language of this
policy is deemed to be ambiguous or otherwise unclear, the issues shall
be resolved in the manner most consistent with the warranties, terms,
conditions, exclusions and limitations viewed as a whole (without regard
to authorship of the language, without any presumption or arbitrary
interpretation or construction in favor of either the Insureds, the
Company or the Insurer).
(j) HEADINGS
The descriptions in the headings and any subheadings of this policy
(including any titles given to any endorsement attached hereto) are
inserted solely for convenience and do not constitute any part of the
terms or conditions hereof.
IN WITNESSETH WHEREOF, the Company has caused this policy to be signed by its
President and a Secretary.
/s/L. M. MURPHY /s/JOSEPH C. H. JOHNSON
Secretary President
ENDORSEMENT NO: 1
This endorsement, effective: June 30, 1996
forms a part of policy number: 700090
Issued to: The Procter and Gamble Company
by: Starr Excess Liability Insurance Company, Ltd.
In consideration of the premium charged, it is hereby understood and
agreed that the Insurer shall not be liable for Loss in connection with any
claim or claims made against the Directors or Officers:
(a) alleging, arising out of, based upon or attributable to the facts
alleged, or to the same or related Wrongful Acts alleged or contained,
in any claim which has been reported, or in any circumstances of which
notice has been given, under any policy, whether excess or underlying,
of which this policy is a renewal or replacement or which it may succeed
in time;
(b) alleging, arising out of, based upon or attributable to any pending or
prior litigation prior to June 13, 1994, or alleging or derived from the
same or essentially the same facts as alleged in such pending or prior
litigation;
All other terms and conditions remain the same.
Authorized Representative:
/s/DAVID F. ALLEN
ENDORSEMENT NO: 2
This endorsement, effective: June 30, 1996
forms a part of policy number: 700090
Issued to: The Procter and Gamble Company
by: Starr Excess Liability Insurance Company, Ltd.
In consideration of the premium charged, it is hereby understood and
agreed that this Policy shall not be subject to the Clause 7 (Automatic
Extension) of the Followed Policy.
All other terms and conditions remain the same.
Authorized Representative:
/s/DAVID F. ALLEN
Excess Directors and Officers Insurance and Corporate Reimbursement
Renewal Application
NOTICE: THE POLICY PROVIDES THAT THE LIMIT OF LIABILITY AVAILABLE TO PAY
JUDGMENTS OR SETTLEMENTS SHALL BE REDUCED BY AMOUNTS INCURRED FOR LEGAL DEFENSE.
FURTHER NOTE THAT AMOUNTS INCURRED FOR LEGAL DEFENSE SHALL BE APPLIED AGAINST
THE RETENTION AMOUNT. IF A POLICY IS ISSUED, THE APPLICATION WILL BE ATTACHED TO
AND BECOME A PART OF THE POLICY, THEREFORE IT IS NECESSARY THAT ALL QUESTIONS BE
ANSWERED ACCURATELY AND COMPLETELY.
IF A POLICY IS ISSUED, IT WILL BE ON A CLAIMS-MADE BASIS.
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1. APPLICANT'S
(a) Corporation name The Procter & Gamble Company
(b) State of Incorporation Ohio
(c) Address One Procter & Gamble Plaza
Cincinnati, Ohio 45202-3314
2. Are any plans for merger, acquisition, consolidation, tender offer or
issuance of securities of or by the Applicant or any of its
Subsidiaries being considered? Yes X No (If yes, please provide
details) The Company's Board has approved a number of acquisitions,
none of which is material or required submission to the Company's
shareholders for approval.
3. Has the Applicant or any of its Subsidiaries filed any registration of
securities under the Securities Act of 1933 or any other offering of
securities within the last year? Yes X No Does it anticipate doing so
within the next year? Yes X No (If yes, give details and submit
offering materials if available)
4. Name of Risk Manager Harold L. Maxson, Director of Insurance
5. Loss experience for Directors & Officers Insurance or similar coverage
(If yes, attach full details. If no losses, check here: X
6. Has any insurance carrier refused, canceled or nonrenewed Directors &
Officers Insurance or similar coverage? Yes No X (If yes,
attach full details including when and reason)
7. Attach copies of the following for the Applicant and, to the extent
available, each of its Subsidiaries:
(a) Latest annual report and 10-K filed with the SEC
(b) Form 10-Q reports and interim financial statements for all
quarters since last 10-K Report
(c) All proxy statements and Notices of Annual Meeting of
Stockholders within the last twelve months
(d) All registration statements filed with the SEC within the last
twelve months and/or any private placement offerings
(e) Any Form 8-K filings made with the SEC within the last twelve
months
(f) If there has been a change since your last application, a
conformed copy of the indemnification provisions of the
charter and the by-laws. Also attach a copy of any corporate
indemnification agreement(s)
(g) Schedule of previous Directors & Officers Insurance, if not
previously insured with Starr Excess
(h) Schedule of current or proposed Directors & Officers Insurance
8. It is agreed that this renewal application is a supplement to the
application(s) which are part of the expiring policy, and that those
application(s) together with this renewal application, constitute the
complete application that shall be the basis of the contract and shall
form part of the policy should a policy be issued.
THE UNDERSIGNED AUTHORIZED OFFICER OF THE APPLICANT DECLARES THAT THE STATEMENTS
SET FORTH HEREIN ARE TRUE. THE UNDERSIGNED AUTHORIZED OFFICER AGREES THAT IF THE
INFORMATION SUPPLIED ON THIS APPLICATION CHANGES BETWEEN THE DATE OF THIS
APPLICATION AND THE EFFECTIVE DATE OF THE INSURANCE, HE/SHE (UNDERSIGNED) WILL,
IN ORDER FOR THE INFORMATION TO BE ACCURATE ON THE EFFECTIVE DATE OF THE
INSURANCE, IMMEDIATELY NOTIFY THE INSURER OF SUCH CHANGES, AND THE INSURER MAY
WITHDRAW OR MODIFY ANY OUTSTANDING QUOTATIONS AND/OR AUTHORIZATIONS OR
AGREEMENTS TO BIND THE INSURANCE.
SIGNING OF THIS APPLICATION DOES NOT BIND THE APPLICANT OR THE INSURER TO
COMPLETE THE INSURANCE, BUT IT IS AGREED THAT THIS APPLICATION SHALL BE THE
BASIS OF THE CONTRACT SHOULD A POLICY BE ISSUED, AND WILL BE ATTACHED TO AND
BECOME PART OF THE POLICY.
ALL WRITTEN STATEMENTS AND MATERIALS FURNISHED TO THE INSURER IN CONJUNCTION
WITH THIS APPLICATION ARE HEREBY INCORPORATED BY REFERENCE INTO THIS APPLICATION
AND MADE A PART HEREOF.
THE UNDERSIGNED AUTHORIZED OFFICER OF THE APPLICANT HEREBY ACKNOWLEDGES THAT
HE/SHE IS AWARE THAT THE LIMIT OF LIABILITY CONTAINED IN THIS POLICY SHALL BE
REDUCED, AND MAY BE COMPLETELY EXHAUSTED, BY THE COSTS OF LEGAL DEFENSE AND, IN
SUCH EVENT, THE INSURER SHALL NOT BE LIABLE FOR THE COSTS OF LEGAL DEFENSE OR
FOR THE AMOUNT OF ANY JUDGMENT OR SETTLEMENT TO THE EXTENT THAT SUCH EXCEEDS THE
LIMIT OF LIABILITY OF THIS POLICY.
THE UNDERSIGNED AUTHORIZED OFFICER OF THE APPLICANT HEREBY FURTHER ACKNOWLEDGES
THAT HE/SHE IS AWARE THAT LEGAL DEFENSE COSTS THAT ARE INCURRED SHALL BE APPLIED
AGAINST THE RETENTION AMOUNT.
Applicant: The Procter & Gamble Company
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By: /S/JOHN E. PEPPER
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(must be signed by the Chairman of the Board or President
Title: Chairman of the Board and Chief Executive
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Date: ---------------------------------------------------------
Corporation: --------------------------------------------------------
(Corporate seal)
Private or Foreign Company Supplement
(Companies outside the United States)
1. Stock Ownership
(a) Total number of voting shares outstanding: 737,933,312
(b) Total number of voting shareholders: 200,134
(c) Total number of voting shares owned by its Directors (direct
and beneficial): 375,774
(d) Total number of voting shares owned by its Officers (direct
and beneficial) who are not Directors: 1,376,147
(e) Does any shareholder own five percent or more of the voting
shares directly or beneficially? If so, designate name and
percentage of holdings. (If no such shareholders, check here
"none". )
P&G Profit Sharing Long Term Incentive Trust - 5.5%
(f) Are there any other securities convertible to voting stock.
If so, fully describe. (If none, check here "none". )
Preferred stock is not traded, but is held for retirees. These
shares are convertible to common stock upon retirement.
2. (a) Complete list of all Directors of the Corporation named in
1(a) of the application by name and affiliation with other
corporations. (If included as an attachment herein, check
here X )
See Annual Report.
3. Complete list of all Officers of the Corporation named in 1(a) of the
application by name and affiliation with other corporations. (If
included as an attachment herein, check here X )
4. List of all direct and indirect Subsidiary corporations:
Business Percentage Date Domestic or Foreign
or Type of of Acquired and Country of
Name Operation Ownership or Created Incorporation
- ---- ---------- ---------- ---------- ------------------
See Schedule I
Coverage to include all Subsidiaries? Yes X No . If yes, include complete list
of Directors and Officers of each Subsidiary. If no, include complete list of
Directors and Officers of each Subsidiary for which coverage is requested. If
included as an attachment herein, check here .
5. Attached complete copy of charter and by-laws
Schedule G
Schedule of Directors and Officers Insurance for previous policy period
(a) Policy expiration date 7/1/96
(b) Policy term 7/1/95-7/1/96
(c) Primary Insurance
Limit of
Name of Insurer Liability Retention Premium
--------------- --------- --------- -------
CODA $25 Million / / $355,000
(d) Excess Insurance (by layer)
Limit of
Name of Insurer Liability Premium
--------------- --------- -------
X. L. $25 Million xs $ 25 Million $150,000
ACE $45 Million xs $ 50 Million $140,000
Starr Excess $50 Million xs $100 Million $125,000
ACE $ 5 Million xs $145 Million Included Above
Schedule H
Schedule of underlying insurance:
List the underlying Directors and Officers insurance which will, or is proposed
to, be carried by the Company for the policy period being applied for:
(a) Primary Insurance
Limit of
Name of Insurer Liability Retention Premium
--------------- --------- --------- -------
CODA $25 Million / / $355,000
(b) Excess Insurance (by layer)
Limit of
Name of Insurer Liability Premium
--------------- --------- -------
X. L. $25 Million xs $ 25 Million $150,000
ACE $45 Million xs $ 50 Million $140,000
Starr Excess $50 Million xs $100 Million $125,000
ACE $ 5 Million xs $145 Million Included Above
(c) Does any policy of excess insurance contain any coverage restrictions or
exclusions which are not in the primary insurance? (If yes, attach full
details. If "no", check here X )