exv10w4





Exhibit 10.4




ULTA SALON, COSMETICS & FRAGRANCE, INC.

2007 INCENTIVE AWARD PLAN

OPTION AGREEMENT — CERTIFICATE




          The following evidences a grant of an option (the “Option”) to purchase shares of common stock
of Ulta Salon, Cosmetics & Fragrance, Inc. (the “Company”) pursuant to the Ulta Salon, Cosmetics &
Fragrance, Inc. 2007 Incentive Award Plan (the “Plan”) to the following individual and upon the
following terms:




	 	 	 

	Optionee: Carl Rubin

	 	Name:
	 

	 	Address:
	 
	 	 
	 

	 	Location-
	 
	 	 
	Grant
Date: May 10, 2010
	 	 
	 
	 	 
	Exercise Price Per Share:
	 	 
	 
	 	 
	Total Number of Shares Granted:
	 	 
	 
	 	 
	Type of Option:

	 	___ Incentive Stock Option
	 

	 	___ Non Qualified Stock Option






          If designated as an Incentive Stock Option, this Option is intended to qualify as an Incentive
Stock Option as defined in Section 422 of the Code; provided, however, that to the extent that it
does not so qualify that portion which does not so qualify shall be treated as a Non-Qualified
Stock Option.




          Unless otherwise defined herein, capitalized terms shall have the same meanings as set forth
in the Plan.




          1. Vesting Schedule. The Option shall vest and become exercisable based on Optionee’s
continued service as an employee, director or consultant to the Company (“Service Provider”) on the
following dates and according to the following schedule:




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Vested Options	 	 	 	 
	Period Elapsed	 	ISO	 	 	NQ	 	 	Total	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 





 









 





Notwithstanding the foregoing, (i) if Optionee’s employment is terminated without Cause prior to
becoming fully vested in the Option, then upon such termination of employment Optionee will be
vested in an additional one-fourth (1/4) of the Option, (ii) the Option will be fully vested and
exercisable if (A) Optionee ceases to be a Service Provider for reasons of death or Disability or
(B) Optionee’s employment is terminated without Cause within twelve (12) months following a Change
in Control. If Optionee ceases to be a Service Provider for reasons of Cause, then the Option will
be forfeited, whether or not previously vested, and all rights Optionee may have to exercise the
Option shall immediately terminate. For this purpose “Cause” shall have the meaning set forth in
the Employment Agreement dated April 12, 2010 by and between the Company and the Optionee.




          2. Option Period. The Option shall be valid for a term commencing on the Grant Date
and will expire the earliest of: (i) ten (10) years from the Grant Date; (ii) the date three (3)
months after the Optionee ceases to be a Service Provider for any reason other than death, or
Disability; (iii) the date twelve (12) months after the Optionee ceases to be a Service Provider by
reason of death, or Disability or (iv) the date Optionee ceases to be a Service Provider for
reasons of Cause.




          3. Exercise. The Option may be exercised at any time during its term to the extent
vested. If Optionee ceases to be a Service Provider any unvested portion of the Option will
terminate and will no longer be exercisable. The Option may not be exercised for fractional
shares. In order to exercise the Option, Optionee shall be required to execute such forms and
provide such notice as the Company may require from time to time. The Option will not be deemed
exercised until the Exercise Price for each share, plus any required tax withholding is delivered
to the Company. The Exercise Price may be paid pursuant to any method allowable under the Plan.




          4. Non-Compete, Non-Solicitation and Confidential Information. The grant of this
Option is subject to the Optionee’s either consenting to or having already consented to and abiding
by the terms of the attached Confidential Information & Restrictive Covenants Agreement.




          5. Withholding. The Company has the authority to deduct or withhold, or require
Optionee to remit to the Company, an amount sufficient to satisfy applicable federal, state, local
and foreign taxes arising from this Option. Optionee may satisfy his or her tax obligation, in
whole or in part : (i) with the consent of the Company, by having the Company withhold shares
otherwise to be delivered with a fair market value equal to the minimum amount of the tax
withholding obligation; (ii) with the consent of the Company, by having the Optionee surrender to
the Company previously owned Common Stock with a fair market value equal to the minimum amount of
the tax withholding obligation; (iii) by payment in cash or check; or (iv) with the consent of the
Company, by delivery of a notice that the Optionee has placed a market sell order with a broker
with respect to shares then issuable upon exercise of the Option, and that the broker has been
directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction
of the withholding amount; provided that payment of such proceeds is then made to the Company upon
settlement of such sale.







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          6. No Additional Rights. Participation in the Plan is voluntary. The value of the
option is an extraordinary item of compensation outside the scope of Optionee’s employment
contract, if any. As such, the option is not part of normal or expected compensation for purposes
of calculating any severance, resignation, redundancy, end of service payments, bonuses,
long-service awards, pensions or retirement benefits or similar payments unless specifically and
otherwise provided in such plans. Rather, the awarding of an option under the Plan represents a
mere investment opportunity.




          7. Not Transferable. This Option is not transferable except by will or the laws of
descent and distribution.




          8. Limitations on Plan Rights. This Option is granted under and governed by the terms
and conditions of the Plan. By acceptance of this Option Optionee acknowledges and agrees that the
Plan is discretionary in nature and may be amended, cancelled, or terminated by the Company, in its
sole discretion, at any time. The grant of an option under the Plan is a one-time benefit and does
not create any contractual or other right to receive a grant of options or benefits in lieu of
options in the future. Future grants of options, if any, will be at the sole discretion of the
Company, including, but not limited to, the timing of the grant, the number of stock options,
vesting provisions, and the exercise price. The Plan has been introduced voluntarily by the
Company and in accordance with the provisions of the Plan may be terminated by the Company at any
time. By acceptance of this Option, Optionee consents to the provisions of the Plan and this
Agreement. Defined terms used herein shall have the meaning set forth in the Plan, unless
otherwise defined herein.




	 	 	 	 	 
	 	COMPANY:







ULTA SALON, COSMETICS & FRAGRANCE, INC., a Delaware corporation

 	 
	 	By:  	
 	 
	 	 	Name:  	Joseph C. Addante 	 
	 	 	Title:  	Vice President of Finance 	 
	 




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