Exhibit 10.1

AVON PRODUCTS, INC.

2005 STOCK INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

1. Grant of Restricted Stock Unit Award. Pursuant to the provisions of its 2005
Stock Incentive Plan (the “Plan”), Avon Products, Inc. (the “Company”) has
awarded you (the “Grantee”) Restricted Stock Units (the “RSUs”), representing
the right to receive in the future shares of Stock (the “Shares”) as set forth
in the Grantee’s grant notification. These RSUs are subject to the terms and
conditions set forth below, as well as those terms and conditions set forth in
the Plan, all of which are hereby incorporated by this reference. All
capitalized terms used in this Restricted Stock Unit Award Agreement (this
“Agreement”) shall have the meaning set forth in the Plan.

2. Nature of RSUs; Issuance of Shares. These RSUs represent a right to receive
Shares on the Vesting Date (as defined below) but do not represent a current
interest in the Shares. If all the terms and conditions hereof and of the Plan
are met, then the Grantee shall be issued certificates for the respective number
of Shares on the Vesting Date (or earlier as provided in this Agreement). In
lieu of issuance of Shares, the Company reserves the right to instead make a
cash payment to the Grantee equal to the Fair Market Value of the Shares
determined as of the Vesting Date (or earlier as provided in this Agreement).

3. Restrictions on Transfer of RSUs. These RSUs may not be sold, tendered,
assigned, transferred, pledged or otherwise encumbered.

4. Vesting of RSUs; Voting; Dividends.

(a) Subject to Section 5, vesting and settlement of the RSUs shall occur on the
date set forth in the Grantee’s grant notification (such date the “Vesting
Date”), provided, however, that the RSUs shall vest sooner upon the occurrence
of a Change in Control and such vested Shares shall be issued to the Grantee
within thirty (30) days after the occurrence of a Change in Control. Subject to
Section 5, vesting is contingent upon the Grantee being employed by the Company
or its Subsidiaries on the Vesting Date, or on the date of the Change in
Control.

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(b) The Grantee does not have the right to vote any of the Shares or to receive
dividends on them prior to the date such Shares are to be issued to the Grantee
pursuant to the terms hereof. However, unless otherwise determined by the
Committee, the Grantee shall be entitled to “Dividend Equivalent Rights” so that
the Grantee will receive a cash payment in respect of the Shares in amounts that
would otherwise be payable as dividends with respect to such number of Shares,
when and as dividends are paid.

5. Termination of Employment.

(a) Termination by the Company without Cause. If the Grantee’s employment is
terminated by the Company (and, if applicable, by any Subsidiary for whom the
Grantee is employed) other than for Cause and the Grantee is not eligible for
Retirement at the end of the payment period under a severance pay plan of the
Company or some other agreement between the Grantee and the Company, then a
pro-rata portion of the RSUs referred to in Section 4(a) above shall become
vested and the appropriate number of such vested Shares shall be issued to the
Grantee within thirty (30) days after such termination date, unless such Grantee
is a “specified employee” on the termination date, as defined in Code
Section 409A and determined pursuant to procedures and elections made by the
Company from time to time, in which case, the vested Shares shall be issued on
the date which is six months after the termination date. The number of Shares
that vest shall be determined by multiplying the full number of Shares subject
to the RSU by a fraction, which shall be the number of complete months of
employment from the date of grant (the “Grant Date”) to the date of termination
(last day of active employment), divided by the number of months from the Grant
Date to the Vesting Date.

(b) Termination due to Retirement. If the Grantee’s employment is voluntarily
terminated due to Retirement, or the Grantee’s employment is terminated by the
Company (and, if applicable by any Subsidiary for whom the Grantee is employed)
other than for Cause and the Grantee is eligible for Retirement at the end of
the payment period under a severance pay plan of the Company or some other
agreement between the Grantee and the Company, then all of the RSUs referred to
in Section 4(a) above shall become vested and such vested Shares shall be issued
to the Grantee on the Vesting Date.

(c) Termination due to Disability. If the Grantee’s employment is terminated due
to Disability, then all of the RSUs referred to in Section 4(a) above shall
become vested and such vested Shares shall be issued to the Grantee on the
Vesting Date.

 

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(d) Death. If the Grantee dies, then all of the RSUs referred to in Section 4(a)
above shall become vested and such vested Shares shall be issued to the
Grantee’s designated beneficiary (or if none, the Grantee’s estate) within
thirty (30) days after such death.

(e) Termination by the Company for Cause or by the Grantee for Any Reason Other
than Retirement, Disability or Death. If the Grantee’s employment is terminated
by the Company (and, if applicable, by any Subsidiary for whom the Grantee is
employed) for Cause, or if the Grantee voluntarily terminates employment for any
reason other than Retirement, Disability or death, then all RSUs shall be
forfeited. “Cause” shall have the same meaning as that provided in the Company’s
severance pay plan on the Grant Date. In addition, termination for Cause shall
include any termination due to acts of dishonesty or gross misconduct on the
part of the Grantee which result, or are intended to result, in damage to the
Company’s business or reputation.

(f) For purposes of determining the vesting of RSUs under this Agreement, a paid
or an unpaid/long-term leave of absence of the Grantee shall not constitute a
termination of employment of the Grantee, except to the extent that such leave
of absence constitutes a “separation from service” (as defined in Code
Section 409A). During a paid or an unpaid/long-term leave of absence until a
“separation from service” occurs, the RSUs shall continue to vest as set forth
in the grant notification referred to in Section 4(a) of this Agreement.

6. Non-Competition/Non-Solicitation/Non-Disclosure. The Grantee agrees that,
during the Grantee’s employment, beginning on the Grant Date, and for a period
of one year after the termination of the Grantee’s employment with the Company
(and, if applicable, a Subsidiary) for any reason whatsoever (including
Retirement or Disability), he or she shall not, without the prior written
consent of the Company, engage in any of the following activities:

(a) the Grantee shall not directly or indirectly engage or otherwise participate
in any business which is competitive with any significant business of the
Company or any Subsidiary, including without limitation, the Grantee’s
acceptance of employment with, entrance into a consulting or advisory
arrangement with, rendering services to or otherwise facilitating the business
of Amway Corporation/Alticor Inc., O Boticário, Ebel International/Belcorp
Corporation, De Millus, S.A., Faberlic, Forever Living Products LLC USA, Gryphon
Development/Limited Brands, Inc., Herbalife Ltd., Hermès, Lady
Racine/LR-International Cosmetic and Marketing GmbH, L’Oréal Group/Cosmair,
Inc., Mary Kay Inc., Natura Cosmetics S.A., Mistine/Better Way (Thailand) Co.
Ltd.,

 

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Neways International, Newcup International, NuSkin Enterprises, Inc., Oriflame
Cosmetics S.A., Reckitt Benckiser PLC, Revlon, Inc., Sara Lee Corporation, The
Body Shop International PLC, The Estée Lauder Companies Inc., The Procter &
Gamble Company, Shaklee Corporation, Tupperware Corporation, the Unilever Group
(N.V. and PLC), Victory Corporation PLC (Virgin Vie, The Virgin Cosmetics
Company, Virgin Ware), Vorwerk & Co. KG/Jafra Worldwide Holdings (Lux) S.àR.L.,
Inc. and Yanbal International/(Yanbal, Unique), or any of their affiliates;

(b) the Grantee shall not solicit or aid in the solicitation of any employees of
the Company or any Subsidiary to leave their employment; or

(c) the Grantee shall not, unless compelled pursuant to an order of a court or
other body having jurisdiction over such matter, communicate or divulge any
secret or confidential information, knowledge or data, including without
limitation any trade secrets, relating to the Company or a Subsidiary, and their
respective businesses, obtained by the Grantee during his or her employment by
the Company or a Subsidiary and which is not otherwise publicly known (other
than by reason of an unauthorized act by the Grantee), to anyone other than the
Company and those designated by it.

In the event the Company determines that the Grantee has breached any term of
this Section 6 or any non-disclosure, non-compete or non-solicitation covenant
set forth in his or her severance agreement, employment contract or any Company
policy, in addition to any other remedies the Company may have available to it,
unless otherwise determined by the Committee, (i) all unvested RSUs granted
hereunder shall be forfeited, (ii) if shares of Stock have been issued to the
Grantee in respect of vested RSUs hereunder, the Grantee shall forfeit all such
shares of Stock so issued to the Grantee hereunder and (iii) if cash has been
paid to the Grantee in lieu of shares of Stock in respect of vested RSUs
hereunder, the Grantee shall pay to the Company all such cash so paid in lieu of
shares of Stock to the Grantee hereunder; provided, however, that if the Grantee
no longer holds shares of Stock issued to the Grantee hereunder, the Grantee
shall pay to the Company in cash the Fair Market Value of any such shares of
Stock on the date such shares of Stock were issued to the Grantee hereunder.

 

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7. No Right to Employment, etc.

(a) The execution and delivery of this Agreement and the granting of the RSUs
hereunder shall not constitute or be evidence of any agreement or understanding,
express or implied, on the part of the Company to employ the Grantee for any
specific period.

(b) The award of the RSUs hereunder does not entitle the Grantee to any benefit
other than that specifically granted under this Agreement, nor to any future
grants or other benefits under the Plan or any similar plan. Any benefits
granted under this Agreement and under the Plan are not part of the Grantee’s
ordinary compensation, and shall not be considered as part of such compensation
in the event of severance, redundancy or resignation. The Grantee understands
and accepts that the benefits granted under the Plan are entirely at the
discretion of the Company and that the Company retains the right to amend or
terminate the Plan, and/or the Grantee’s participation therein, at any time, at
the Company’s sole discretion and without notice.

8. Change of Capitalization. If, prior to the time the restrictions imposed by
this Agreement on the RSUs awarded hereunder lapse, the Company shall be
reorganized, or consolidated or merged with another corporation, the appropriate
amount of any stock, securities or other property exchangeable for shares of
Stock pursuant to such reorganization, consolidation or merger shall be
appropriately substituted for the Shares hereunder.

9. Application of Laws. The granting of these RSUs and the delivery of Shares
hereunder shall be subject to all applicable laws, rules and regulations.

10. Taxes. By accepting this grant, the Grantee hereby irrevocably elects to
satisfy any taxes required to be withheld by the Company on the date of delivery
of any Shares hereunder or any earlier date on which such taxes may be due by
authorizing the Company to withhold a sufficient number of Shares (or cash in
lieu thereof if the RSUs are to be settled in cash) to satisfy such tax
obligation. Notwithstanding the preceding sentence, if, on the applicable
vesting date, the delivery of Shares is not made because the Grantee has not
retired or because of Internal Revenue Code Section 409A requirements or because
the Grantee elects pursuant to the Company’s Deferred Compensation Plan to defer
the delivery of any Shares payable hereunder, the Grantee hereby irrevocably
elects to satisfy all applicable FICA taxes due on the applicable vesting date
with respect to such Shares for which delivery is being deferred by delivering
cash to the Company in an amount sufficient to satisfy all such FICA taxes.

 

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IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the Grantee
have executed this Agreement as of the Grant Date.

 

AVON PRODUCTS, INC.     GRANTEE

 

   

 

Andrea Jung     Name: Chief Executive Officer    

 

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