AMERICAN HOME PRODUCTS CORP
1994 RESTRICTED STOCK PLAN -  DIRECTORS
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>5
<FILENAME>dirres.txt
<DESCRIPTION>1994 RESTRICTED STOCK PLAN -  DIRECTORS
<TEXT>
                       AMERICAN HOME PRODUCTS CORPORATION

              1994 RESTRICTED STOCK PLAN FOR NON-EMPLOYEE DIRECTORS

          (Initially approved by stockholders on April 20, 1994 and as
              amended by the Board of Directors on June 21, 2001)

     Section  1.  Purpose.   The  purpose  of  the  Restricted  Stock  Plan  for
Non-Employee  Directors of American Home Products  Corporation is to attract and
retain  qualified  persons  who are not  employees  or former  employees  of the
Company or any of its  subsidiaries  or affiliates for service as members of the
Board of Directors by granting such  Directors  shares of the  Company's  Common
Stock,  which are  restricted in accordance  with the terms and  conditions  set
forth below,  and thereby  encouraging  ownership in the Company by non-employee
Directors.

     Section 2. Definitions.  Whenever used herein, unless the context otherwise
indicates,  the  following  terms  shall have the  respective  meaning set forth
below:

     Act: The Securities Exchange Act of 1934, as amended.

     Board  Membership:  The period of time during which a person  serves on the
Board of  Directors,  regardless  of  whether  occurring  before  or  after  the
Effective Date.

     Board of Directors (or Board): The Board of Directors of the Company.

     Committee:  The  Compensation  and  Benefits  Committee  of  the  Board  of
Directors appointed to administer the Plan in accordance with Section 7 hereof.

     Common Stock:  Common Stock, par value $.33 1/3 per share, of American Home
Products Corporation.

     Company:  American  Home  Products  Corporation  or any  successor to it in
ownership of substantially all of its assets,  whether by merger,  consolidation
or otherwise.

     Director: Any member of the Board of Directors.

     Disability:  A medically  determinable  physical or mental impairment which
renders a participant substantially unable to function as a Director.

     Effective Date: The date specified in Section 10 hereof.

     Eligible  Director (or Non-Employee  Director):  Any Director who is not an
employee  or  former  employee  of the  Company  or any of its  subsidiaries  or
affiliates.

     Participant:  Each Director to whom  Restricted  Stock is granted under the
Plan.

     Plan: The 1994 Restricted Stock Plan for Non-Employee Directors of American
Home Products Corporation.

     Restricted  Period:  The  period  of time  from  the  date of  grant of the
Restricted  Stock until the earliest to occur of the events described in Section
4(b) hereof.

     Retirement Benefit: A normal benefit payable under the Retirement Plan.

     Retirement Plan: The American Home Products Corporation Retirement Plan for
Outside Directors, as amended.

     Restricted  Stock:  Common Stock granted under the Plan which is subject to
restrictions in accordance with Section 4 hereof.

     Year of Board Membership: 365 consecutive days of Board Membership.

     Section 3. Eligibility and Grants.

     (a) Grants.  To be eligible to participate in the Plan, a Director must not
be an employee or former  employee of the Company or any of its  subsidiaries or
affiliates.  Each  Eligible  Director  on the  Effective  Date of the Plan shall
receive a grant of eight hundred (800) shares of Restricted  Stock. In addition,
each  person  who  becomes  an  Eligible  Director  for the first time after the
Effective  Date of the Plan shall also  receive a grant of eight  hundred  (800)
shares of Restricted  Stock,  effective as of the date of such person's election
as an Eligible  Director.  Thereafter,  each Eligible  Director shall be granted
eight hundred (800) shares of Restricted Stock for each subsequent Year of Board
Membership,  up to a maximum of four thousand (4,000) shares of Restricted Stock
per Eligible  Director.  Notwithstanding  anything to the contrary  contained in
this Plan, if a Participant  shall terminate  service as a Director due to death
or  Disability  prior to having been  granted  the  maximum  number of shares of
Restricted Stock hereunder and provided the Participant is not then eligible for
a Retirement  Benefit under the Retirement Plan, then such Participant,  or such
Participant's  beneficiary  or  estate,  as the  case may be,  shall be  granted
additional  shares of Restricted Stock which together with the shares previously
granted  under the Plan  will  equal  such  maximum  number  of  shares  and all
restrictions  applicable  to such shares shall lapse on the later of the date of
such  termination of service or six months after the date of grant.  If required
by the Committee, each grant of Restricted Stock shall be evidenced by a written
agreement duly executed by or on behalf of the Company and the Participant.

     b) Number of Shares.  The total number of shares of Restricted  Stock which
may be  granted  under the Plan  shall not  exceed  100,000.  The  shares may be
authorized  and  unissued  or  issued  and  reacquired  shares,  as the Board of
Directors from time to time may determine.  Shares of Restricted  Stock that are
forfeited before the restrictions lapse shall be available for subsequent grants
of Restricted Stock under the Plan.

     (c)  Non-Consecutive   Terms.  An  Eligible  Director  who  is  elected  to
non-consecutive  terms of Board  Membership shall receive  additional  grants of
shares  of  Restricted  Stock at the time of such  re-election  to the Board and
thereafter as provided in Section 3, provided that the amounts so granted,  when
aggregated with the number of shares of Restricted Stock  previously  granted to
such Director with respect to which the restrictions  thereon shall have lapsed,
does not exceed four thousand (4,000) shares.

     Section 4. Terms and Conditions of Restricted  Stock.  The restrictions set
forth in this  section  shall  apply to each grant of  Restricted  Stock for the
duration of the Restricted Period.

     (a) Restrictions.  A stock certificate representing the number of shares of
Restricted Stock granted shall be registered in the Participant's name but shall
be held in custody by the Company for the Participant's account. The Participant
shall have all rights and  privileges  of a  stockholder  as to such  Restricted
Stock,  including  the rights to vote and to  receive  dividends,  except  that,
subject to the provisions of Sections 3(a) and 4(b), the following  restrictions
shall  apply:  (i) the  Participant  shall not be  entitled  to  delivery of the
certificate  until the  expiration of the  Restricted  Period;  (ii) none of the
shares  of  Restricted  Stock may be sold,  transferred,  assigned,  pledged  or
otherwise  encumbered  or disposed of during the  Restricted  Period;  (iii) the
Participant  shall,  if  requested  by the  Company,  execute and deliver to the
Company,  a stock power  endorsed in blank.  The  Participant  shall forfeit all
shares of Restricted Stock with respect to which such  restrictions do not lapse
at the end of the Restricted  Period.  Upon the forfeiture (in whole or in part)
of shares of  Restricted  Stock,  such  forfeited  shares shall become  treasury
shares of the Company without further action by the Participant. The Participant
shall  have  the  same  rights  and  privileges,  and be  subject  to  the  same
restrictions, with respect to any shares received pursuant to Section 6.

     (b) Events.  The Restricted Period shall end upon the first to occur of the
following events:

     (i)  Five Years of Service.  The  Participant  completes  at least five (5)
          years of  service  from the date of the  initial  grant of  Restricted
          Stock to the Participant under the Plan.

     (ii) Disability.  The  Participant  ceases  to be a  Director  by reason of
          Disability; provided, however, that if the Participant is at such time
          entitled to a Retirement Benefit,  then the Restricted Period shall be
          deemed  not to have  lapsed.  In such case,  all shares of  Restricted
          Stock will be forfeited.

     (iii)Death.  The  Participant  ceases to be a Director  by reason of death;
          provided, however, that if the Participant is at such time entitled to
          a Retirement  Benefit,  then the Restricted Period shall be deemed not
          to have lapsed.  In such case, all shares of Restricted  Stock will be
          forfeited.

     (c) Delivery of Restricted  Shares.  At the end of the Restricted Period as
herein provided,  subject to Section 3(a), a stock certificate for the number of
shares of Restricted  Stock with respect to which the  restrictions  have lapsed
shall be delivered,  free of all such  restrictions,  to the  Participant or the
Participant's  beneficiary  or  estate,  as the  case  may  be,  subject  to the
withholding  requirements of Section 9 hereof. The Company shall not be required
to deliver any  fractional  share of Common Stock but will pay, in lieu thereof,
the fair market value (measured as of the date the  restrictions  lapse) of such
fractional share to the Participant or the Participant's  beneficiary or estate,
as the case may be.  Notwithstanding  the foregoing,  a Participant  may make an
irrevocable  election to cause the Company to contribute such Restricted  Shares
to the Restricted Stock Trust which he or she otherwise would have received from
the Plan by completing a deferral election form provided by the Company, wherein
such shares  shall be held,  subject to the claims of the  Company's  creditors,
until delivered to the Participant in accordance with such election.

     Section 5. Regulatory  Compliance and Listing.  The issuance or delivery of
any shares of  Restricted  Stock may be postponed by the Company for such period
as may be required to comply with any applicable  requirements under the federal
securities laws, any applicable listing  requirements of any national securities
exchange or any requirements under any other law or regulation applicable to the
issuance or delivery of such shares and the Company  shall not be  obligated  to
issue or deliver any such  shares if the  issuance  or  delivery  thereof  shall
constitute a violation  of any  provision  of any law or any  regulation  of any
governmental authority or any national securities exchange.

     Section 6. Adjustments.  In the event of a  recapitalization,  stock split,
stock dividend, combination or exchange of shares, merger, consolidation, rights
offering, separation,  reorganization or liquidation, or any other change in the
corporate  structure  or  shares of the  Company,  the  Committee  may make such
equitable  adjustments,  to prevent dilution or enlargement of rights, as it may
deem  appropriate  in the  number and class of shares  authorized  to be granted
hereunder.

     Section  7.   Administration.   The  Plan  shall  be  administered  by  the
Compensation and Benefits Committee,  consisting of three or more Directors each
of whom shall be a  "disinterested  Director"  within the  meaning of Rule 16b-3
under the Act. All  determinations  of the Committee  shall be  conclusive.  The
Committee  may obtain such advice or  assistance  as it deems  appropriate  from
persons not serving on the Committee.

     Section 8.  Termination  or Amendment.  The Board may at any time terminate
the Plan and may from time to time  alter or amend the Plan or any part  thereof
(including any amendment  deemed necessary to ensure that the Company may comply
with any regulatory  requirement  referred to in Section 5), provided,  however,
that, unless otherwise required by law, the rights of a Participant with respect
to shares of Restricted Stock granted prior to such  termination,  alteration or
amendment  may not be  impaired  without the  consent of such  Participant  and,
provided  further,  without  the  approval  of the  Company's  stockholders,  no
alteration  or  amendment  may be made which would (i)  increase  the  aggregate
number of shares of Restricted  Stock that may be granted under the Plan (except
by operation of Section 6), or (ii) change the category of Directors eligible to
receive  shares  of  Restricted  Stock  under  the  Plan.   Notwithstanding  the
foregoing,  the Plan shall not 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. The Company intends that
the Plan and the grants of  Restricted  Stock  hereunder  shall  comply with the
conditions of Rule 16b-3 of the Act and qualify for the  exemption  from Section
16(b) of the Act as a  "formula  plan".  Should  any  provisions  hereof  not be
necessary  in order to comply with the  requirements  of such Rule or should any
additional provisions be necessary in order to so comply, the Board of Directors
may amend the Plan accordingly,  without the necessity of obtaining the approval
of the Company's stockholders.

     Section 9. Miscellaneous.

     (a) Right to Re-election. Nothing in the Plan shall be deemed to create any
obligation on the part of the Board to nominate any Director for  re-election by
the Company's  stockholders,  nor confer upon any Director the right to remain a
member of the Board of Directors.

     (b) Withholding and Responsibility For Taxes. The Company shall satisfy any
tax withholding  obligation  required by law by reducing the number of shares of
Common Stock otherwise  deliverable to the  Participant or the Restricted  Stock
Trust, as the case may be. To the extent no taxes are required to be withheld on
the delivery of the shares of Common Stock to the  Participant or the Restricted
Stock  Trust,  the  Participant  shall be  responsible  for the  payment  of all
applicable taxes.

     (c)  Governing  Law. This Plan shall be governed by the law of the State of
Delaware and in accordance with such federal laws as may be applicable.

     (d)  Construction.  Wherever  any  words are used  herein in the  masculine
gender they shall be  construed  as though  they were also used in the  feminine
gender in all cases where they would so apply,  and  wherever any words are used
herein in the  singular  form they shall be  construed  as though they were also
used in the plural form in all cases where they would so apply.

     Section 10. Effective Date. The Plan shall be submitted to the stockholders
of the Company for their  approval at the Annual Meeting of  Stockholders  to be
held on April 20, 1994.  The Plan shall become  effective  upon the  affirmative
vote of the  holders of a majority  of the shares of Common  Stock  present,  or
represented, and entitled to vote at the meeting.

     Section 11. Change in Control.  Upon the occurrence of a Change in Control,
Restricted  Stock  that was  previously  granted  under the Plan  (which has not
previously been forfeited)  will become vested,  and the Restricted  Period with
respect to such Restricted  Stock will be deemed to have ended.  For purposes of
this provision, a Change in Control will be deemed to have occurred if:

     (a)  any person or persons  acting in concert  (excluding  Company  benefit
          plans)  becomes  the  beneficial  owner of  securities  of the Company
          having  at  least  20% of the  voting  power  of  the  Company's  then
          outstanding  securities (unless the event causing the 20% threshold to
          be crossed is an acquisition of voting common securities directly from
          the Company); or

     (b)  the  consummation  of any merger or other business  combination of the
          Company,  sale or lease of the Company's  assets or combination of the
          foregoing  transactions (the "Transactions")  other than a Transaction
          immediately  following which the shareholders of the Company who owned
          shares immediately prior to the Transaction  (including any trustee or
          fiduciary  of any  Company  employee  benefit  plan) own, by virtue of
          their prior  ownership of the  Company's  shares,  at least 65% of the
          voting power, directly or indirectly, of (a) the surviving corporation
          in any such merger or other business combination; (b) the purchaser or
          lessee of the Company's assets; or (c) both the surviving  corporation
          and the  purchaser  or  lessee  in the  event  of any  combination  of
          Transactions; or

     (c)  within any 24 month period, the persons who were directors immediately
          before the beginning of such period (the "Incumbent  Directors") shall
          cease  (for any  reason  other than  death) to  constitute  at least a
          majority of the Board or the board of  directors of a successor to the
          Company.  For this purpose, any director who was not a director at the
          beginning of such period  shall be deemed to be an Incumbent  Director
          if such director was elected to the Board by, or on the recommendation
          of or with the approval of, at least  two-thirds  of the directors who
          then  qualified as Incumbent  Directors  (so long as such director was
          not  nominated  by a person  who has  expressed  an intent to effect a
          Change in Control or engage in a proxy or other control contest).



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