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UNITEDSTATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM10-K

(Mark One)

|        |                                                                                         |
|--------|-----------------------------------------------------------------------------------------|
|   | **ANNUAL REPORT PURSUANT TO SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** |

For the fiscal year ended December 31,2005

OR

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|--------|---------------------------------------------------------------------------------------------|
|   | **TRANSITION REPORT PURSUANT TOSECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** |

For the transition period from                     to                    

Commissionfile number 1-11178

REVLON, INC.

(Exact name of registrant as specified in itscharter)

|                                                               |  |                                    |            |        |  |  |
|---------------------------------------------------------------|--|------------------------------------|------------|--------|--|--|
| **DELAWARE**                                                  |  |                               | 13-3662955 |   |
| (State or other jurisdiction ofincorporation or organization) |  | (I.R.S.EmployerIdentification No.) |
| **237Park Avenue, New York, New York**                        |  | **10017**                          |
| (Address of principal executive offices)                      |  | (ZipCode)                          |
|                                                               |

Registrant's telephonenumber, including area code: (212) 527-4000

Securities registered pursuant to Section 12(b) or 12(g)of the Act:

|                         |  |                                               |  |  |  |  |
|-------------------------|--|-----------------------------------------------|--|--|--|--|
| **Title of each class** |  | **Name of each exchange on which registered** |
| Class A Common Stock    |  | New York StockExchange                        |
|                         |

Indicate by check markif the registrant is a well-known seasoned issuer, as defined in Rule405 of the Securities Act.

Yes        No        

Indicate by check mark if the registrant is notrequired to file reports pursuant to Section 13 or Section 15(d) of theAct.

Yes        No        

Indicate by check mark whether the registrant (1)has filed all reports required to be filed by Section 13 or 15(d) ofthe Securities Exchange Act of 1934 during the preceding 12 months (orfor such shorter period that the registrant was required to file suchreports), and (2) has been subject to such filing requirements for thepast 90 days.

Yes        No        

Indicate by check mark if disclosure of delinquentfilers pursuant to Item 405 of Regulation S-K (§ 229.405 of thischapter) is not contained herein, and will not be contained, to thebest of registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of thisForm 10-K or any amendment to this Form10-K.    

Indicate by check markwhether the registrant is a large accelerated filer, an acceleratedfiler, or a non-accelerated filer. See definition of‘‘accelerated filer’’ and ‘‘largeaccelerated filer’’ in Rule 12b-2 of the Exchange Act.(Check one):

Large acceleratedfiler      Acceleratedfiler      Non-acceleratedfiler    

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2 ofthe Act).

Yes        No        

The aggregate market value of the registrant'sClass A Common Stock held by non-affiliates (using the New York StockExchange closing price as of June  30,  2005, the lastbusiness day of the registrant's most recently completed secondfiscal quarter) was approximately $460,699,713.

As of December  31,  2005, 340,426,418shares of Class A Common Stock and 31,250,000 shares of Class B CommonStock were outstanding. 20,819,333 shares of Class A Common Stock andall of the shares of Class B Common Stock were owned by REV HoldingsLLC, a Delaware limited liability company and an indirectlywholly-owned subsidiary of MacAndrews & Forbes Holdings Inc., and169,341,308 shares of Class A Common Stock were beneficially owned byMacAndrews & Forbes Holdings Inc. and its affiliates.

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Revlon, Inc. andSubsidiaries

Form 10-K

For the Year EndedDecember  31,  2005

Table of Contents

|             |  |                                                                                                            |        |        |  |  |  |  |  |  |
|-------------|--|------------------------------------------------------------------------------------------------------------|--------|--------|--|--|--|--|--|--|
|        |  |                                                                                                       |        | Page   |
| **PARTI**   |  |                                                                                                       |   |   |
| Item1.      |  | Business                                                                                                   |        | 2      |
| Item 1A.    |  | Risk Factors                                                                                               |        | 11     |
| Item 1B.    |  | Unresolved Staff Comments                                                                                  |        | 22     |
| Item 2.     |  | Properties                                                                                                 |        | 22     |
| Item 3.     |  | LegalProceedings                                                                                           |        | 22     |
| Item4.      |  | Submission of Matters to a Vote of Security Holders                                                        |        | 23     |
| **PARTII**  |  |                                                                                                       |
| Item 5.     |  | Market forRegistrant's Common Equity, Related Stockholder Matters and IssuerPurchases of Equity Securities |        | 24     |
| Item 6.     |  | Selected Financial Data                                                                                    |        | 24     |
| Item 7.     |  | Management'sDiscussion and Analysis of Financial Condition and Results ofOperations                        |        | 26     |
| Item7A.     |  | Quantitative and Qualitative Disclosures About MarketRisk                                                  |        | 45     |
| Item8.      |  | Financial Statements and Supplementary Data                                                                |        | 46     |
| Item 9.     |  | Changes in andDisagreements with Accountants on Accounting and FinancialDisclosure                         |        | 46     |
| Item9A.     |  | Controls and Procedures                                                                                    |        | 46     |
| Item 9B.    |  | Other Information                                                                                          |        | 47     |
| **PARTIII** |  |                                                                                                       |
| Item 10.    |  | Directorsand Executive Officers of the Registrant                                                          |        | 53     |
| Item 11.    |  | Executive Compensation                                                                                     |        | 58     |
| Item 12.    |  | SecurityOwnership of Certain Beneficial Owners and Management and RelatedStockholder Matters               |        | 68     |
| Item13.     |  | Certain Relationships and Related Transactions                                                             |        | 70     |
| Item 14.    |  | PrincipalAccounting Fees and Services                                                                      |        | 74     |
| **PARTIV**  |  |                                                                                                       |
| Item 15.    |  | Exhibits andFinancial Statement Schedules                                                                  |        | 76     |
|        |  | Index to ConsolidatedFinancial Statements and Schedules                                                    |        | F-1    |
|        |  | Report of Independent Registered Public AccountingFirm                                                     |        | F-2    |
|        |  | Report of IndependentRegistered Public Accounting Firm                                                     |        | F-3    |
|        |  | Financial Statements                                                                                       |        | F-4    |
|        |  | Financial Statement Schedule                                                                               |        | F-48   |
|        |  | Signatures                                                                                                 |        |   |
|        |  | Certifications                                                                                             |        |   |
|        |  | Exhibits                                                                                                   |        |   |
|             |

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PART I

|              |          |
|--------------|----------|
| Item1.  | Business |

Background

Revlon,Inc. (and together with its subsidiaries, the‘‘Company’’) conducts its business exclusivelythrough its wholly-owned operating subsidiary, Revlon Consumer ProductsCorporation (‘‘Products Corporation’’), whichmanufactures, markets and sells an extensive array of cosmetics,skincare, fragrances and personal care products. **Revlon** is oneof the world's leading mass-market cosmetics brands. **Revlon**believes that its global brand name recognition, product quality andmarketing experience have enabled it to create one of the strongestconsumer brand franchises in the world. The Company's products aresold worldwide and marketed under such brand names as **Revlon,ColorStay, Fabulash, Super Lustrous**and**Revlon Age Defying**makeup with**Botafirm**, as well as the newly relaunched**Almay** brand, including the Company’s new **Almay Intensei-Color** collection, and the Company’s latest brand, **VitalRadiance,** in cosmetics; a new **Almay**skincare line, as wellas **Ultima II** and **Gatineau** in skincare; **Charlie**and**Jean Naté** in fragrances; **Revlon**and**Expert Effects** in beauty tools; and **Mitchum, Flex, Colorsilk**and **Bozzano** in personal care products. In addition, theCompany has a licensing group pursuant to which the Company licensescertain of its key brand names to third parties for complimentarybeauty-related products and accessories.

The Company was foundedby Charles Revson, who revolutionized the cosmetics industry byintroducing nail enamels matched to lipsticks in fashion colors over 70years ago. Today, the Company has leading market positions in a numberof its principal product categories in the U.S. mass-marketdistribution channel, including the lip, eye, face makeup and nailenamel categories. The Company also has leading market positions inseveral product categories in certain retail markets outside of theU.S., including Australia, Canada, Mexico and South Africa. TheCompany’s products are sold in more than 100 countries acrosssix continents. The Company’s net sales in 2005 in the U.S. andCanada accounted for approximately 64% of its consolidated netsales, most of which were made in the mass-market channel.

AllU.S. market share and market position data herein for theCompany’s brands are based upon retail dollar sales, which arederived from ACNielsen data. ACNielsen measures retail sales volume ofproducts sold in the U.S. mass-market distribution channel. Such datarepresent ACNielsen’s estimates based upon data gathered byACNielsen from market samples and are therefore subject to some degreeof variance. Additionally, as of August  4,  2001,ACNielsen’s data do not reflect sales volume from Wal-Mart,Inc., which is the Company’s largest customer. Wal-Mart, Inc.represented approximately 24.0% of the Company’s 2005worldwide net sales. From time to time, ACNielsen adjusts itsmethodology for data collection and reporting, which may result inadjustments to the categories and market shares tracked by ACNielsenfor both current and prior periods. The category and market share datacontained herein has been updated to reflect ACNielsen’sJuly  2005 adjustments.

The Company's Plan

The Company's plan was comprised of three main components: (1)the Cost Rationalization Phase; (2) the Stabilization and Growth Phase;and (3) the Accelerated Growth Phase. The Company has completed thefirst two phases of its plan and it is currently in phase three of itsplan.

The overall objectives of this three-phase plan are to a)create and develop the most consumer-preferred brands, b) become themost valuable partner to the Company's retailers and  c)become a top company where people choose to work.

AcceleratedGrowth Phase

The Company intends to capitalize on the actionstaken during the Cost Rationalization Phase and Stabilization andGrowth Phase of its plan, with the objective of increasing revenues andachieving profitability over the long term. The Company currentlyanticipates that this phase of the plan will include various actionsthat represent refinements of and additions to the actions taken duringthe Stabilization 

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and Growth Phase of its plan, with theobjective of balancing top-line growth with an improved operatingprofit margin and developing and implementing productivity initiatives.These current ongoing initiatives include, among other things, actionsto:

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Further improve the new productdevelopment and introduction process with even deeper insights into theCompany’s consumers and the categories in which it competes.This process has yielded insights leading to the Company’slaunch of a completely new line of cosmetics under the new **VitalRadiance** brand, which focuses on women over 50 years of age, aswell as the relaunch of **Almay**, targeting women who are lookingfor a simpler approach to the cosmetics category. |

|              |                                                                                                    |
|--------------|----------------------------------------------------------------------------------------------------|
| •  | Continue to increase the effectiveness ofthe Company's display walls across categories and brands. |

|              |                                                                                                                                                                                   |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Drive efficiencies across theCompany's overall supply chain. The Company plans to reducemanufacturing costs by continuing to rationalize components and bysourcing strategically. |

|              |                                                                                  |
|--------------|----------------------------------------------------------------------------------|
| •  | Optimize theeffectiveness of the Company's advertising, marketing andpromotions. |

|              |                                                                                                                                                                                                                                                                                |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Continue the training anddevelopment of its organization. The Company will continue the trainingand development of its employees so that the Company may continue toimprove its capability to execute the Company’s strategies whileproviding enhanced job satisfaction. |

|              |                                                                                                                                               |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Continue to strengthen the Company'sbalance sheet and capital structure. The Company has continued tostrengthen its balance sheet since 2004: |

|  |           |                                                                                                                                                                                                                                                                                                                                          |
|--|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (i)  | In March  2004, Revlon, Inc.exchanged approximately $804  million of ProductsCorporation's debt, $54.6  million of Revlon, Inc.'spreferred stock and $9.9  million of accrued interest for299,969,493 shares of Revlon, Inc. Class A common stock, with a parvalue of $0.01 per share (‘‘Class A CommonStock’’); |

|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (ii)  | InJuly  2004, Products Corporation entered into a new 2004 CreditAgreement (as hereinafter defined), consisting of an $800.0million term loan facility (which was partially prepaid in 2005, asfurther discussed below) and a $160.0  million asset-basedmulti-currency revolving credit facility, and used the proceeds torefinance its 2001 Credit Agreement (as hereinafter defined) and toredeem all $363.0  million aggregate principal amount outstandingof Products Corporation’s 12% Senior Secured Notes due in2005 (the "12% Senior SecuredNotes"); |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--|-------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iii)  | InMarch  2005, Products Corporation issued $310.0  millionaggregate principal amount of 91⁄2% Senior Notes(as hereinafter defined) and used such proceeds to redeem all$116.2  million aggregate principal amount outstanding of its8 1/8% Senior Notes (as hereinafter defined) andall $75.5  million aggregate principal amount outstanding of its9% Senior Notes (as hereinafter defined) and to prepay$100.0  million of indebtedness outstanding under the term loanfacility of the 2004 Credit Agreement, together with accrued interestand the associated $5.0  million prepayment fee, and to pay$7.0  million in certain fees and expenses associated with theissuance of such notes; |

|  |            |                                                                                                                                                                                                                                                                                          |
|--|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iv)  | InAugust  2005, Products Corporation issued $80.0  millionaggregate principal amount of additional 91⁄2%Senior Notes, which priced at 951⁄4% of par,which funds were available to the Company for general corporatepurposes, including to help fund its brand initiatives; and |

|  |           |                                                                                                                                                                                                                                                                                                                                     |
|--|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (v)  | In August  2005, Revlon, Inc.also announced its plans to conduct an equity issuance in the amount ofapproximately $185  million in 2006 and that it planned to use theproceeds from approximately $110  million of such equity issuanceto reduce Products Corporation's debt. (See ‘‘RecentDevelopments’’). |

Continuing to implement and refinethe Company's plan could include taking advantage of additionalopportunities to reposition, repackage or reformulate one or more ofthe Company's brands or product lines, launching new brands orproduct lines or further refining the Company’s approach toretail merchandising. Any of these actions, whose intended purposewould be to create value through profitable growth, could result in theCompany making investments or recognizing charges related to executingagainst such opportunities.

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Recent Developments

InFebruary  2006, Revlon, Inc. announced that it had launched andplans to complete in March  2006, a $110  million rightsoffering that would allow stockholders to purchase additional shares ofClass A Common Stock. Pursuant to the rights offering, Revlon, Inc.distributed, at no charge, one transferable subscription right for eachshare of Class A Common Stock and Class B Common Stock (as hereinafterdefined) held by each stockholder of record as of 5:00 p.m. EasternStandard Time on February  13,  2006, the record date for therights offering. Each subscription right entitles the holder of suchright to purchase 0.1057 shares of Class A Common Stock. As there willbe no fractional shares issued, a rights holder will need to hold atleast ten subscription rights to acquire one share of Class A CommonStock in the rights offering. The subscription price for each share ofClass A Common Stock is $2.80 per share, which subscription price wasrecommended by a committee of Revlon, Inc.'s Board of Directorscomposed solely of independent directors within the meaning of Section303A.02 of the NYSE Listed Company Manual and the Board'sGuidelines for Assessing Director Independence and ratified andconfirmed by the Board of Directors (with Messrs. Perelman, Gittis andDrapkin recusing themselves as they are officers of MacAndrews &Forbes (as hereinafter defined)).

Under an over-subscriptionprivilege, each rights holder that exercises its basic subscriptionprivilege in full may also subscribe in the rights offering foradditional shares of Class A Common Stock at the same subscriptionprice of $2.80 per share, to the extent that other rights holders donot exercise their subscription rights in full. If a sufficient numberof shares are not available to fully satisfy the over-subscriptionprivilege requests, the available shares will be sold pro-rata amongsubscription rights holders who exercised their over-subscriptionprivilege, based on the number of shares each subscription rightsholder subscribed for under the basic subscription privilege.

MacAndrews & Forbes has agreed not to exercise its basicsubscription privilege. Instead, pursuant to a Stock Purchase Agreementbetween MacAndrews & Forbes and Revlon, Inc., MacAndrews &Forbes has agreed to purchase at the same $2.80 subscription price, ina private placement directly from Revlon, Inc., the shares of Class ACommon Stock that it would otherwise have been entitled to subscribefor pursuant to its basic subscription privilege in the rights offering(equal to approximately 60% of the shares available for purchasein the rights offering, or approximately $66  million). MacAndrews& Forbes also agreed not to exercise its over-subscriptionprivilege in the rights offering, which will maximize the sharesavailable for purchase by other stockholders pursuant to theirover-subscription privileges.

If any shares in the rightsoffering remain following the exercise of the basic subscriptionprivilege and the over-subscription privilege by rights holders otherthan MacAndrews & Forbes, MacAndrews & Forbes will back-stopthe rights offering by purchasing at the same $2.80 subscription price,also in a private placement directly from Revlon, Inc., the remainingshares of Class A Common Stock offered but not purchased by otherrights holders. As a result, Revlon, Inc. is assured of raising$110  million in gross proceeds through a combination of therights offering and the sale of shares, in a private placement and, ifnecessary, the back-stop, to MacAndrews & Forbes.

Revlon,Inc. expects to transfer the proceeds from the rights offering toProducts Corporation which it would use, together with available cash,to redeem approximately $110  million aggregate principal amountof Products Corporation's 8 5/8% SeniorSubordinated Notes due 2008, in satisfaction of the applicablerequirements under Products Corporation's 2004 Credit Agreement(as hereinafter defined).

Revlon, Inc. also announced inFebruary  2006 that it intends to conduct a further $75million equity issuance through an underwritten public offering byJune  30,  2006. In connection with such further equityissuance, Revlon, Inc. also announced in February  2006 that ithad entered into an amendment to its 2004 Investment Agreement (ashereinafter defined) with MacAndrews & Forbes, which extendsMacAndrews & Forbes’ back-stop of Revlon, Inc.’splanned $75  million equity issuance from March  31,2006 until June  30,  2006 to, among other things, provideRevlon, Inc. with sufficient time to complete, following the rightsoffering, an underwritten public offering of its Class A Common Stock,the proceeds of which would be transferred by Revlon, Inc. to ProductsCorporation to be available for general corporate purposes. Revlon,Inc. also announced that Products Corporation had entered into anamendment to its 2004 Consolidated MacAndrews & Forbes Line ofCredit (as hereinafter defined) extending the term of such agreementuntil the consummation of Revlon, Inc.’s planned $75million equity issuance.

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Also in February  2006, Revlon, Inc.separately announced an organizational realignment largely involvingthe consolidation of certain functions within its sales, marketing andcreative groups, as well as certain headquarters functions, whichchanges are designed to streamline internal processes, enabling theCompany to continue to be more effective and efficient in meeting theneeds of its consumers and retail customers. The Company indicated thatit expects to take a charge in 2006 of approximately $10  millionto cover severance and other expenses associated with theorganizational realignment, with the vast majority of the charge toimpact results in the first quarter of 2006. The Company estimated thatongoing annualized savings associated with the organizationalrealignment will be approximately $15  million.

Revlon,Inc. also announced in February  2006 that Products Corporationhad entered into an amendment to its 2004 Credit Agreement whichenables Products Corporation to exclude, from various financialcovenants, certain charges in connection with the aforementionedorganizational realignment, as well as some start-up investment chargesincurred by the Company in 2005 related to the launch of its new VitalRadiance brand and the re-launch of Almay. Specifically, such amendmentprovides for the add-back to the definition of‘‘EBITDA’’ the lesser of (i) $50  million;or (ii) the cumulative one-time charges associated with (a) theaforementioned organizational realignment; and (b) the non-recurringcosts in the third and fourth quarters of 2005 associated with thelaunch of the Company's new Vital Radiance brand and the re-launchof Almay. Under the 2004 Credit Agreement, such definition is used inthe determination of Products Corporation's senior securedleverage ratio (the ratio of Products Corporation’s SeniorSecured Debt to EBITDA, as each such term is defined in the 2004 CreditAgreement) and the consolidated fixed charge coverage ratio (the ratioof Products Corporation’s EBITDA minus Capital Expenditures toCash Interest Expense for such period, as each such term is defined inthe 2004 Credit Agreement).

Products

The Companymanufactures and markets a variety of products worldwide. The followingtable sets forth the Company's principal brands and certainselected products.

|                 |  |                 |  |                |  |                  |  |                             |  |           |  |  |  |  |  |  |  |  |  |  |  |  |
|-----------------|--|-----------------|--|----------------|--|------------------|--|-----------------------------|--|-----------|--|--|--|--|--|--|--|--|--|--|--|--|
| COSMETICS       |  | HAIR            |  | BEAUTY TOOLS   |  | FRAGRANCE        |  | ANTI-PERSPIRANTS/DEODORANTS |  | SKINCARE  |
| Revlon          |  | Colorsilk       |  | Revlon         |  | Charlie          |  | Mitchum                     |  | Gatineau  |
| Almay           |  | High Dimension  |  | Expert Effects |  | Jean Naté |  | Almay                       |  | Almay     |
| Vital Radiance* |  | Frost &Glow |  |           |  |             |  |                        |  | Ultima II |
|            |  | Flex            |  |           |  |             |  |                        |  |      |
|            |  | Bozzano         |  |           |  |             |  |                        |  |      |
|                 |

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|--|
|  |  |
|  |

|   |                    |
|---|--------------------|
| * | Newbrand for 2006. |

Cosmetics — Revlon:    TheCompany sells a broad range of cosmetics and skincare products underits flagship **Revlon** brand designed to fulfillspecifically-identified consumer needs, principally priced in the upperrange of the mass-market distribution channel, including lip makeup,nail color and nail care products, eye and face makeup and skincareproducts such as lotions, cleansers, creams, toners and moisturizers.Many of the Company's products incorporate patented,patent-pending or proprietary technology. (See ‘‘NewProduct Development and Research and Development’’).

The Company markets several different lines of **Revlon** lipmakeup (which address different segments of the lip makeup category).The Company's **ColorStay** lipcolor uses patentedtransfer-resistant technology that provides long wear; while**ColorStay Overtime**Lipcolor and **Colorstay OvertimeSheers**’ patented lip technology offers long-wearing benefitswhile enhancing comfort and shine. **Super Lustrous** lipstick isthe Company's flagship wax-based lipcolor, which was furtherimproved in 2005 with the addition of **LiquiSilk** technologydesigned to boost moisturization using silk dispersed inemollients.

The Company sells face makeup, including foundation,powder, blush and concealers, under several **Revlon** brand names.**Revlon Age Defying,**which is targeted for women in the over-35age bracket, was further improved in 2005 with the incorporation of**Botafirm**, to help reduce the appearance of lines and wrinkles.The Company also markets a complete range of **ColorStay** longwearing face makeup with patented **SoftFlex** Technology forenhanced comfort.

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The Company's eye makeup productsinclude mascaras, eyeliners and eye shadows. In mascaras, keyfranchises include **Fabulash,**which uses a patented lashperfecting brush for 100% fuller lashes, as well as the newlylaunched **Luxurious Lengths** mascara which makes lashes appear asmuch as 50% longer. The eyeshadow franchises include**Colorstay 12-Hour Eyeshadow** which enables color to look freshfor 12 hours, and **Illuminance**, an eye shadow that gives sheerluminous color, as well as **Eyeglide Shimmer Shadow**, a creamshadow in a twist-up package.

The Company's nail color andnail care lines include enamels, cuticle preparations and enamelremovers. The Company's flagship **Revlon** nail enamel uses apatented formula that provides consumers with improved wear,application, shine and gloss in a toluene-free, formaldehyde-free andphthalate-free formula. In 2005, the Company launched **Color BeamSheer** nail enamel, which comes in a unique array of shades and hasmultiple patents on its longwearing formula. The Company alsomarkets**ColorStay**nail enamel, which offers superior color andshine for 10 days with an exclusive **ColorLock** system. TheCompany also markets**ColorStay Always On** nail enamel, whichoffers 10-day superior color and wear in an exclusive 2-step system. Inaddition, the Company sells **Cutex** nail polish remover and nailcare products in certain countries outside the U.S.

Cosmetics— Almay:    The Company's **Almay** brand consistsof a line of hypo-allergenic, dermatologist-tested, fragrance-freecosmetics and skincare products. **Almay** products include lipmakeup, eye and face makeup, and skincare products. In 2006, the**Almay** brand has been relaunched to focus on consumers’needs for simplicity, personalization and healthy beauty. Therelaunched line includes 18 new product launches, 4 product restagesand new packaging and formulas affecting over 200 stock keeping units(‘‘SKUs’’). Many of the products are organizedinto expertly coordinated collections that retail customers can easilyfind by answering 3 simple questions about skin type, eye color andfavorite lipshade. The relaunched **Almay** line is intended toprovide today’s increasingly busy women with a simple solutionto healthy beauty.

With **Almay**’s renewed commitmentto skin, the **Almay**brand now offers a complete 3-step skincareline with natural ingredients customized by skin type, as well as aline of anti-aging products with Moringa seed, and a line of bodyfirming and sunless tanning products for a complete look. Within theface category, the **Almay** consumer can also easily find productsfor the consumer’s skin type. In eye makeup, the Company hasfurther expanded upon the breakthrough **Almay Intense i-Color**collection with the ‘‘Play Up’’ collection— providing a new look of color-coordinated shades of shadow,liner and mascara for each eye color. **Ideal Lip**is a new productcollection that provides a complete lip look — lipstick, linerand gloss — where the consumer can choose by favorite lip shade.The **Almay** brand flagship **One Coat**franchise has beenstrengthened with the introduction of the patented Triple Effectmascara for a more dramatic look.

Cosmetics — VitalRadiance:    The Company's **Vital Radiance** brandfocuses on women over 50 years of age and involves the launch of acomplete line of cosmetics that is designed to serve this affluent andgrowing consumer demographic currently underserved in the marketplace.The Company believes that **Vital Radiance** is the first majorcolor cosmetics brand created with women's changing skin in mind.The Company introduced **Vital Radiance** with a unique‘‘**Prepare • Color • Finish’’**beauty system to help more mature women achieve the look that is rightfor them. Using the Company's exclusive hydrating formulas andcarefully-developed age-appropriate color palette, with the launch of**Vital Radiance** the Company combined an understanding of the moremature women's skin's needs with a desire to make the most oftheir beauty experience. The **Vital Radiance**‘‘Prepare • Color • Finish’’ systemis designed to fulfill the beauty needs of the changing skin ofmore-mature women. **Vital Radiance**‘‘Prepare’’ products have moisture-richformulas that help to prepare the skin for makeup application byevening out the skin's surface, filling in the lines andconcealing imperfections.**Vital Radiance**‘‘Color’’ products feature selected shadepalettes for face, eyes and lips that help bring back color anddefinition while revitalizing overall appearance.**Vital Radiance**‘‘Finish’’ products add a final, defining touchfor a beautiful, polished, more vibrant look.

Hair:    The Company sells both haircare and haircolorproducts throughout the world. In the U.S., the **Colorsilk** brandwas the fastest growing haircolor brand in the mass-market distributionchannel in 2005. The Company also markets **High Dimension**haircolor, the first and only permanent haircolor that 

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works in 10 minutes, as well as its **Frost& Glow** highlighting brand. In haircare, the Company sells the**Flex** and **Aquamarine** lines in many countries and the**Bozzano** and **Juvena** brands in Brazil.

BeautyTools:    The Company sells **Revlon** Beauty Tools, whichinclude nail and eye grooming tools, such as clippers, scissors, files,tweezers and eye lash curlers. **Revlon** Beauty Tools are soldindividually and in sets under the **Revlon** brand name and are thenumber one brand of beauty tools in the U.S. mass-market distributionchannel. In 2005, Revlon introduced 14 new Beauty Tool products,including a new line called **Expert Effects** which have beendesigned ergonomically to enable proper technique for expert-likeresults.

Fragrances:    The Company sells a selectionof moderately-priced and premium-priced fragrances, including perfumes,eau de toilettes, colognes and body sprays. The Company'sportfolio includes fragrances such as**Charlie**and **Ciara**as well as**Jean Naté.**In 2006, the Company intends tore-enter the prestige fragrance market in the U.S.

Anti-perspirants/deodorants:    In the area ofanti-perspirants and deodorants, the Company markets **Mitchum**,**Aquamarine** and **Hi & Dri** antiperspirant brands in manycountries. The Company also markets hypo-allergenic personal careproducts, including antiperspirants, under the **Almay** brand.

Skincare:    The Company's skincare products,including moisturizers, are predominantly sold under the **Almay**brand name, as mentioned above. Other brand names include **Eterna27**, **Vitamin C Absolutes** and **Ultima II**. In addition,the Company sells skincare products in international markets underinternationally-recognized brand names and under various regionalbrands, including the Company's premium-priced **Gatineau**brand, as well as **Ultima II**.

Marketing

TheCompany markets extensive consumer product lines principally priced inthe upper range of the mass-market distribution channels and certainother channels outside of the U.S.

The Company uses print andtelevision advertising and point-of-sale merchandising, includingdisplays and samples. The Company's marketing emphasizes a uniformglobal image and product for its portfolio of core brands, including**Revlon, ColorStay, Revlon Age Defying, Almay, Vital Radiance(**currently available only in U.S. retailers), **Charlie** and**Mitchum**. The Company coordinates advertising campaigns within-store promotional and other marketing activities. The Companydevelops jointly with retailers carefully tailored advertising,point-of-purchase and other focused marketing programs. The Companyuses network and spot television advertising, national cableadvertising and print advertising in major general interest,women's fashion and women's service magazines, as well ascoupons and other trial incentives. In 2005, the Company expanded itsmedia reach utilizing ‘‘non-traditional’’vehicles such as outdoor advertising, newspapers and movie theaters tosupplement its media mix.

The Company also uses cooperativeadvertising programs, supported by Company-paid or Company-subsidizeddemonstrators, and coordinated in-store promotions and displays. Othermarketing materials designed to introduce the Company's newestproducts to consumers and encourage trial and purchase in-store includetrial-size products and couponing. Additionally, the Company maintainsseparate websites, www.revlon.com, www.almay.com, www.vitalradiance.comand www.mitchumman.com devoted to the **Revlon**, **Almay, VitalRadiance**and**Mitchum** brands, respectively. Each of thesewebsites feature current product and promotional information for thebrands, respectively, and are updated regularly to stay current withthe Company's new product launches and other advertising andpromotional campaigns. In addition, the Almay and Vital Radiancewebsites offer coupons and/or sampling incentives to their consumersand offer unique, personalized beauty guides.

TheCompany’s launch of its **Vital Radiance** brand wasaccompanied by the introduction of its **Vital Radiance** BeautyCenter staffed with trained beauty specialists who are available sevendays a week, via an 800 telephone number or through the **VitalRadiance** website, www.vitalradiance.com, to provide consumers withcustomized service by helping them to answer all of their beautyquestions and to help ensure that they achieve their perfect look. The**Vital Radiance** beauty specialists are trained extensively inskin assessment, makeup application, color matching, product selectionand consultation. Using their thorough knowledge of the **VitalRadiance** product line, they are trained to match consumers with the

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products that will best satisfy their beautyneeds. The **Vital Radiance** beauty specialists are available liveto answer consumers' questions by calling 1-800-RADIANT orconsumers may send their questions online at www.vitalradiance.com.

New Product Development and Research and Development

TheCompany believes that it is an industry leader in the development ofinnovative and technologically-advanced consumer products. TheCompany's marketing and research and development groups identifyconsumer needs and shifts in consumer preferences in order to developnew products, tailor line extensions and promotions and redesign orreformulate existing products to satisfy such needs or preferences. TheCompany's research and development group comprises departmentsspecialized in the technologies critical to the Company's variousproduct categories, as well as an advanced technology department thatpromotes inter-departmental, cross-functional research on a wide rangeof technologies to develop new and innovative products. In connectionwith the implementation of the Stabilization and Growth Phase of theCompany's plan, the Company has developed and implemented a newcross-functional product development process intended to optimize theCompany's ability to bring to market its new product offerings andto ensure that the Company has products in key trend categories.

The Company operates an extensive cosmetics research and developmentfacility in Edison, New Jersey. The scientists at the Edisonfacility are responsible for all of the Company’s new productresearch worldwide, performing research for new products, ideas,concepts and packaging. The research and development group atthe Edison facility also performs extensive safety and quality testingon the Company’s products, including toxicology, microbiologyand package testing. Additionally, quality control testing isperformed at each manufacturing facility.

As of December31,  2005, the Company employed approximately 180 people in itsresearch and development activities, including specialists inpharmacology, toxicology, chemistry, microbiology, engineering,biology, dermatology and quality control. In 2005, 2004 and 2003, theCompany spent $26.1  million, $24.0  million and $25.4million, respectively, on research and development activities.

Manufacturing and Related Operations and Raw Materials

During 2005, the Company’s cosmetics and/or personal careproducts were produced at the Company’s facilities in Oxford,North Carolina; Irvington, New Jersey; Venezuela; France; South Africa;China; and Mexico and at third-party owned facilities around the world.The Company has also substantially completed its transfer of theproduction of products for its European markets from CreativeOutsourcing Solutions International Limited in Maesteg, Wales to theCompany’s Oxford, North Carolina facility. In the second half of2005, the Company undertook significant increases in manufacturing anddistribution activities, primarily at its Oxford, North Carolinafacility, in connection with the launch of its two major brandinitiatives, the **Almay**relaunch and the launch of **VitalRadiance**.

The Company continually reviews its manufacturingneeds against its manufacturing capacities to identify opportunities toreduce costs and operate more efficiently. The Company purchases rawmaterials and components throughout the world, and continuously pursuesreductions in cost of goods through the global sourcing of rawmaterials and components from qualified vendors, utilizing itspurchasing capacity designed to maximize cost savings. TheCompany’s global sourcing strategy for materials and componentsfrom accredited vendors is also designed to ensure the quality of theraw materials and components and assists in protecting the Companyagainst shortages of, or difficulties in obtaining, such materials. TheCompany believes that alternate sources of raw materials and componentsexist and does not anticipate any significant shortages of, ordifficulty in obtaining, such materials.

Distribution

The Company's products are sold in more than 100 countriesacross six continents. The Company's worldwide sales force hadapproximately 420 people as of December  31,  2005, includinga dedicated sales force for cosmetics, skincare, fragrance and personalcare products in the U.S. mass-market distribution channel. Inaddition, the Company utilizes sales representatives and independentdistributors to serve certain markets and related distributionchannels.

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United States and Canada.    Netsales in the U.S. and Canada accounted for approximately 64% ofthe Company's 2005 net sales, a majority of which were made in themass-market distribution channel. The Company also sells a broad rangeof consumer products to U.S. Government military exchanges andcommissaries. The Company licenses its trademarks to selectmanufacturers for complimentary beauty-related products and accessoriesthat the Company believes have the potential to extend theCompany's brand names and image. As of December  31,2005, nine (9) licenses were in effect relating to fifteen (15) productcategories, which are marketed principally in the mass-marketdistribution channel. Pursuant to such licenses, the Company retainsstrict control over product design and development, product quality,advertising and the use of its trademarks. These licensing arrangementsoffer opportunities for the Company to generate revenues and cash flowthrough royalties and renewal fees, some of which have beenprepaid.

As part of the Company’s strategy to increasethe retail consumption of its products, the Company’s retailmerchandisers stock and maintain the Company's point-of-sale walldisplays intended to ensure that high-selling SKUs are in stock and toensure the optimal presentation of the Company's products inretail outlets.

International.    Net sales outsidethe U.S. and Canada accounted for approximately 36% of theCompany's 2005 net sales. The ten largest countries in terms ofthese sales include South Africa, Australia, U.K., China, Brazil,Japan, France, Mexico, Italy and Venezuela, which together accountedfor approximately 28% of the Company's 2005 net sales. TheCompany distributes its products through drug stores/chemists,hypermarkets/mass volume retailers, variety stores, department storesand specialty stores such as perfumeries. At December  31,2005, the Company actively sold its products through wholly-ownedsubsidiaries established in 16 countries outside of the U.S. andthrough a large number of distributors and licensees elsewhere aroundthe world.

Customers

The Company's principalcustomers include large mass volume retailers and chain drug stores,including such well-known retailers as Wal-Mart, Target, Kmart,Walgreens, Rite Aid, CVS, Eckerd, Albertsons Drugs and Longs in theU.S., Shoppers DrugMart in Canada, Boots in the United Kingdom, A.S.Watson & Co. retail chains in Asia Pacific and Europe. Wal-Mart andits affiliates worldwide accounted for approximately 24.0% ofthe Company's 2005 net sales. As is customary in the consumerproducts industry, none of the Company’s customers is under anobligation to continue purchasing products from the Company in thefuture. The Company expects that Wal-Mart and a small number of othercustomers will, in the aggregate, continue to account for a largeportion of the Company's net sales. Although the loss of Wal-Martor one or more of the Company's other customers that may accountfor a significant portion of the Company's sales, or anysignificant decrease in sales to these customers or any significantdecrease in retail display space in any of these customers'stores, could have a material adverse effect on the Company'sbusiness, financial condition or results of operations, the Company hasno reason to believe that any such loss of customers or decrease insales will occur.

Competition

The consumer productsbusiness is highly competitive. The Company competes primarily on thebasis of: developing quality products with innovative performancefeatures, shades, finishes and packaging; educating consumers on theCompany’s product benefits; anticipating and responding tochanging consumer demands in a timely manner, including the timing ofnew product introductions and line extensions; offering attractivelypriced products relative to the product benefits provided; maintainingfavorable brand recognition; generating competitive margins andinventory turns for its retail customers by providing market-rightproducts and executing effective pricing, incentive and promotionprograms; ensuring product availability through effective planning andreplenishment collaboration with retailers; providing strong andeffective advertising, marketing, promotion and merchandising support;maintaining an effective sales force; and obtaining sufficient retailfloor space, optimal in-store positioning and effective presentation ofits products at retail. For 2005, the Revlon and Almay brands combinedheld U.S. mass-market share of 21.6%, compared with 21.4%for 2004 and 22.2% for 2003. The Company 

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competes in selected product categoriesagainst a number of multinational manufacturers, some of which arelarger and have substantially greater resources than the Company, andwhich may therefore have the ability to spend more aggressively onadvertising and marketing and have more flexibility than the Company torespond to changing business and economic conditions. In addition toproducts sold in the mass-market and demonstrator-assisted channels,the Company's products also compete with similar products sold inprestige department store channels, door-to-door or through mail-orderor telemarketing by representatives of direct sales companies. TheCompany's principal competitors include L'Oréal S.A.,The Procter & Gamble Company and The Estée Lauder CompaniesInc.

Patents, Trademarks and Proprietary Technology

TheCompany's major trademarks are registered in the U.S. and in wellover 100 other countries, and considers trademark protection to be veryimportant to its business. Significant trademarks include**Revlon**, **ColorStay, Revlon Age Defying** makeup with**Botafirm, High Dimension, Frost & Glow, Illuminance, Cutex**(outside the U.S.), **Mitchum, Eterna 27, Almay, Almay Intensei-Color, Almay Kinetin**, **Vital Radiance**, **Ultima II, Flex,Charlie, Jean Naté, Moon Drops, Super Lustrous**,**Colorsilk, Gatineau**and**Bozzano**. The Company regularlyrenews its important trademark registrations in the ordinary course ofbusiness if the applicable trademark remains in use.

The Companyutilizes certain proprietary, patent pending or patented technologiesin the formulation or manufacture of a number of the Company’sproducts, including **ColorStay** cosmetics, classic **Revlon**nail enamel, **Skinlights** skin brightener, **High Dimension**hair color, **Super Top Speed** nail enamel, **Revlon AgeDefying** foundation and cosmetics**, New Complexion** makeup**,Time-Off** makeup, **Amazing Lasting** cosmetics and **Almay OneCoat** cosmetics. The Company also protects certain of its packagingand component concepts through design patents. The Company considersits proprietary technology and patent protection to be important to itsbusiness.

The Company files patents on a continuing basis in theordinary course of business on certain of the Company’s newtechnologies. Patents in the U.S. are effective for up to 20 years andinternational patents are generally effective for up to 20 years. Thepatents that the Company currently has in place expire at various timesbetween 2008 and 2025 and the Company expects to continue to filepatent applications on certain of its technologies in the ordinarycourse of business in the future.

Government Regulation

The Company is subject to regulation by the Federal Trade Commission(the ‘‘FTC’’) and the Food and DrugAdministration (the ‘‘FDA’’) in the U.S., aswell as various other federal, state, local and foreign regulatoryauthorities, including the European Commission in the European Union(‘‘EU’’). The Oxford, North Carolinamanufacturing facility is registered with the FDA as a drugmanufacturing establishment, permitting the manufacture of cosmeticsthat contain over-the-counter drug ingredients, such as sunscreens andantiperspirants. Compliance with federal, state, local and foreign lawsand regulations pertaining to discharge of materials into theenvironment, or otherwise relating to the protection of theenvironment, has not had, and is not anticipated to have, a materialeffect upon the Company's capital expenditures, earnings orcompetitive position. State and local regulations in the U.S. andregulations in the EU that are designed to protect consumers or theenvironment have an increasing influence on the Company's productclaims, ingredients and packaging.

Industry Segments, Foreignand Domestic Operations

The Company operates in a singlesegment. Certain geographic, financial and other information of theCompany is set forth in the Consolidated Statements of Operations andNote 19 of the Notes to Consolidated Financial Statements of theCompany.

Employees

As of December  31,  2005,the Company employed approximately 6,800 people. As of December31,  2005, approximately 150 of such employees in the U.S. werecovered by collective bargaining agreements. The Company believes thatits employee relations are satisfactory. Although the Company

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has experienced minor work stoppages oflimited duration in the past in the ordinary course of business, suchwork stoppages have not had a material effect on the Company'sresults of operations or financial condition.

|               |              |
|---------------|--------------|
| Item1A.  | Risk Factors |

In addition to the otherinformation in this report, investors should consider carefully thefollowing risk factors when evaluating the Company’sbusiness.

**Revlon, Inc. is a holding company with nobusiness operations of its own and is dependent on its subsidiaries topay certain expenses and dividends. In addition, shares of the capitalstock of Products Corporation, Revlon, Inc.'s wholly-ownedsubsidiary, are pledged by Revlon, Inc. to secure obligations under the2004 Credit Agreement.**

Revlon, Inc. is a holding companywith no business operations of its own. Revlon, Inc.’s onlymaterial asset is all of the outstanding capital stock of ProductsCorporation, Revlon, Inc.’s wholly-owned subsidiary, throughwhich the Company conducts its business operations. As such, Revlon,Inc.’s net (loss) income has historically consistedpredominantly of its equity in the net (loss) income of ProductsCorporation, which for 2005, 2004 and 2003 was approximately $(77.8)million, $(142.8) million and $(154.0) million, respectively, whichexcluded approximately $7.6  million, $1.2  million and$1.2  million, respectively, in expenses primarily related tobeing a public holding company. Revlon, Inc. is dependent on theearnings and cash flow of, and dividends and distributions from,Products Corporation to pay Revlon, Inc.’s expenses incidentalto being a public holding company. Products Corporation may notgenerate sufficient cash flow to pay dividends or distribute funds toRevlon, Inc. because, for example, Products Corporation may notgenerate sufficient cash or net income; state laws may restrict orprohibit Products Corporation from issuing dividends or makingdistributions unless Products Corporation has sufficient surplus or netprofits, which Products Corporation may not have; or becausecontractual restrictions, including negative covenants contained inProducts Corporation’s various debt instruments, may prohibit orlimit such dividends or distributions.

The terms of the 2004Credit Agreement, the 2004 Consolidated MacAndrews & Forbes Line ofCredit (each as hereinafter defined) and the indentures governingProducts Corporation’s outstanding 91⁄2%Senior Notes and 8 5/8% Senior Subordinated Notes(each as hereinafter defined) generally restrict Products Corporationfrom paying dividends or making distributions, except that ProductsCorporation is permitted to pay dividends and make distributions toRevlon, Inc., among other things, to enable Revlon, Inc. to makecertain payments and pay expenses incidental to being a public holdingcompany.

Shares of the capital stock of Products Corporationheld by Revlon, Inc. are pledged to secure Revlon, Inc.’sguarantee of Products Corporation's obligations under the 2004Credit Agreement. A foreclosure upon the shares of ProductsCorporation's common stock would result in Revlon, Inc. no longerholding its only material asset and would have a material adverseeffect on the holders of Revlon, Inc.’s common stock and wouldbe a change of control under other debt instruments of ProductsCorporation.

**Products Corporation’s substantialindebtedness could adversely affect the Company’s operations andflexibility and Products Corporation’s ability to service itsdebt.**

Products Corporation has a substantial amount ofoutstanding indebtedness. As of December  31,  2005, theCompany’s total indebtedness was $1,422.4  million,primarily including $327.0  million aggregate principal amountoutstanding of Products Corporation's 8 5/8%Senior Subordinated Notes, $386.4  million aggregate principalamount outstanding of Products Corporation's91⁄2% Senior Notes and $700.0  millionaggregate principal amount outstanding under the 2004 Credit Agreement.Additionally, the Company has a history of net losses and if it isunable to achieve sustained profitability in future periods, it couldadversely affect the Company's operations and ProductsCorporation's ability to service its debt.

In July2004, Products Corporation entered into the 2004 Credit Agreement witha syndicate of lenders and Citicorp USA, Inc., as agent. The 2004Credit Agreement currently consists of a $700.0  million Term LoanFacility (as hereinafter defined) and a $160.0  millionasset-based Multi-Currency Facility (as hereinafter defined). TheCredit Facilities (as hereinafter defined) under the 2004 

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Credit Agreement are subject to terminationon October  30,  2007 if the 8 5/8%Senior Subordinated Notes, with an aggregate principal amountoutstanding of $327.0  million as of December  31,2005, are not redeemed, repurchased, defeased or repaid such that notmore than $25.0  million of such notes remain outstanding on orbefore such date. In addition, it will be an event of default under the2004 Credit Agreement and the 2004 Credit Agreement could terminate ifRevlon, Inc. does not issue approximately $110  million of equityand transfer the proceeds of such issuance to Products Corporation byMarch  31,  2006 to promptly reduce outstanding indebtedness.(See ‘‘Recent Developments’’, as to Revlon,Inc.'s plan to, among other things, conduct a rights offering byMarch  31,  2006 and redeem approximately $110  millionof the 8 5/8% Senior Subordinated Notes).

The Company is subject to the risks normally associated withsubstantial indebtedness, including the risk that the Company’soperating revenues and the operating revenues of its subsidiaries willbe insufficient to meet required payments of principal and interest,and the risk that Products Corporation will be unable to refinanceexisting indebtedness when it becomes due or that the terms of any suchrefinancing will be less favorable than the current terms of suchindebtedness. Products Corporation’s substantial indebtednesscould also:

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | limit theCompany’s ability to fund (including by obtaining additionalfinancing) the costs and expenses of the continued implementation of,and refinement to, the Company’s business plan, including inconnection with the Company’s previously-announced brandinitiatives (consisting of the complete relaunch of **Almay** andthe introduction of **Vital Radiance**), future working capital,capital expenditures, advertising or promotional expenses, new productdevelopment costs, purchases and reconfiguration of wall displays,acquisitions, investments, restructuring programs and other generalcorporate requirements; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                             |
|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | require theCompany to dedicate a substantial portion of its cash flow fromoperations to payments on Products Corporation’s indebtedness,thereby reducing the availability of the Company’s cash flow forthe continued implementation of, and refinement to, theCompany’s business plan, including funding the Company’sbrand initiatives, and for other general corporate purposes; |

|              |                                                                                                 |
|--------------|-------------------------------------------------------------------------------------------------|
| •  | place the Company at a competitivedisadvantage compared to its competitors that have less debt; |

|              |                                                                                                                         |
|--------------|-------------------------------------------------------------------------------------------------------------------------|
| •  | limit the Company’s flexibilityin responding to changes in its business and the industry in which itoperates; and |

|              |                                                                                                           |
|--------------|-----------------------------------------------------------------------------------------------------------|
| •  | make the Company morevulnerable in the event of adverse economic conditions or a downturn inits business. |

Although agreements governing ProductsCorporation’s indebtedness, including the indentures governingProducts Corporation’s outstanding 91⁄2%Senior Notes and 8 5/8% Senior SubordinatedNotes, the agreement governing the 2004 Consolidated MacAndrews &Forbes Line of Credit and the 2004 Credit Agreement, limit ProductsCorporation’s ability to borrow additional money, under certaincircumstances Products Corporation is allowed to borrow a significantamount of additional money, some of which, in certain circumstances andsubject to certain limitations, could be secured indebtedness.

Products Corporation’s ability to pay the principal of itsindebtedness depends on many factors.

Products Corporationcurrently anticipates that, in order to pay the principal amount of itsoutstanding indebtedness upon the occurrence of any event of default,to repurchase its 91⁄2% Senior Notes and8 5/8% Senior Subordinated Notes if a change ofcontrol occurs or in the event that Products Corporation’s cashflows from operations are insufficient to allow it to pay the principalamount of its indebtedness at maturity, the Company may be required torefinance Products Corporation’s indebtedness, seek to sellassets or operations, seek to sell additional Revlon, Inc. securities,or seek additional capital contributions or loans from MacAndrews &Forbes or from the Company’s other affiliates or third parties.Revlon, Inc. is a public holding company and has no business operationsof its own, and Revlon, Inc.’s only material asset is thecapital stock of Products Corporation. None of the Company’saffiliates are required to make any capital contributions, loans orother payments to Products Corporation regarding its obligations on itsindebtedness. Products Corporation may not be able to pay the principalamount of 

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its indebtedness if the Company took any ofthe above actions because, under certain circumstances, the indenturesgoverning Products Corporation’s outstanding91⁄2% Senior Notes and8 5/8% Senior Subordinated Notes or any of itsother debt instruments (including the 2004 Credit Agreement and the2004 Consolidated MacAndrews & Forbes Line of Credit) or the debtinstruments of Products Corporation’s subsidiaries then ineffect may not permit the Company to take such actions. (See‘‘Restrictions and covenants in ProductsCorporation’s debt agreements limit its ability to take certainactions and impose consequences in the event of failure tocomply.’’).

Restrictions and covenants in ProductsCorporation’s debt agreements limit its ability to take certainactions and impose consequences in the event of failure to comply.

Agreements governing Products Corporation’s indebtedness,including the 2004 Credit Agreement, the agreement governing the 2004Consolidated MacAndrews & Forbes Line of Credit and the indenturesgoverning Products Corporation’s outstanding91⁄2% Senior Notes and8 5/8% Senior Subordinated Notes, contain anumber of significant restrictions and covenants that limit ProductsCorporation’s ability and its subsidiaries' ability, amongother things (subject in each case to limited exceptions), to:

|              |               |
|--------------|---------------|
| •  | borrow money; |

|              |                                                            |
|--------------|------------------------------------------------------------|
| •  | use assets as security in otherborrowings or transactions; |

|              |                                          |
|--------------|------------------------------------------|
| •  | paydividends on stock or purchase stock; |

|              |              |
|--------------|--------------|
| •  | sell assets; |

|              |                                                     |
|--------------|-----------------------------------------------------|
| •  | enter into certain transactions withaffiliates; and |

|              |                          |
|--------------|--------------------------|
| •  | make certaininvestments. |

In addition, the 2004 Credit Agreement containsfinancial covenants limiting Products Corporation’s secureddebt-to-EBITDA ratio and, under certain circumstances, requiringProducts Corporation to maintain a minimum consolidated fixed chargecoverage ratio. (See ‘‘Recent Developments’’regarding Products Corporation’s recent amendment to its 2004Credit Agreement). The 2004 Credit Agreement also includes provisionsthat would cause the acceleration of the maturities of the CreditFacilities if the 8 5/8% Senior SubordinatedNotes are not refinanced prior to October  30,  2007 suchthat not more than $25.0  million of such notes remainoutstanding. In addition, it will be an event of default if Revlon,Inc. fails to issue approximately $110  million of equity andtransfer the proceeds of such issuance to Products Corporation byMarch  31,  2006 to promptly reduce outstanding indebtedness.(See ‘‘Recent Developments’’ as to Revlon,Inc.'s intention to, among other things, conduct a $110million rights offering by March  31,  2006 and use theproceeds to reduce Products Corporation's debt). These covenantsaffect Products Corporation’s operating flexibility by, amongother things, restricting its ability to incur expenses andindebtedness that could be used to fund the costs of implementing andrefining the Company’s business plan and to grow theCompany’s business, including with respect to theCompany’s brand initiatives, as well as to fund generalcorporate purposes. The breach of certain covenants contained in the2004 Credit Agreement would permit Products Corporation’slenders to accelerate amounts outstanding under the 2004 CreditAgreement, which would in turn constitute an event of default under the2004 Consolidated MacAndrews & Forbes Line of Credit and theindentures governing Products Corporation’s outstanding91⁄2% Senior Notes and8 5/8% Senior Subordinated Notes, if the amountaccelerated exceeds $25.0  million and such default remainsuncured for 10 days following notice from MacAndrews & Forbes withrespect to the 2004 Consolidated MacAndrews & Forbes Line of Creditor the trustee or holders of the applicable percentage under theapplicable indenture. In addition, holders of ProductsCorporation’s outstanding 91⁄2% SeniorNotes and 8 5/8% Senior Subordinated Notes mayrequire Products Corporation to repurchase their respective notes inthe event of a change of control under the applicable indenture. (See‘‘Products Corporation’s ability to pay theprincipal of its indebtedness depends on many factors.’’).Products Corporation may not have sufficient funds at the time of anysuch breach of any such covenant or change of control to repay in fullthe borrowings under the 2004 Credit Agreement, or to repurchase orredeem its outstanding 91⁄2% Senior Notes and/or8 5/8% Senior Subordinated Notes.

Eventsbeyond the Company’s control, such as decreased consumerspending in response to weak economic conditions, weakness in themass-market cosmetics category, retailer inventory management,

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adverse changes in currency, increasedcompetition from the Company’s competitors, changes in consumerpurchasing habits, including with respect to shopping channels, lowerthan anticipated success of the Company’s advertising andmarketing plans, lower than expected customer or consumer acceptance ofthe Company’s brand initiatives, decreased sales of theCompany’s existing products as a result of the Company’sbrand initiatives and changes in the competitive environment, couldimpair the Company’s operating performance, which could affectProducts Corporation’s ability and that of its subsidiaries tocomply with the terms of Products Corporation’s debtinstruments. Products Corporation and its subsidiaries may be unable tocomply with the provisions of Products Corporation’s debtinstruments, including the financial covenants in the 2004 CreditAgreement. If Products Corporation is unable to satisfy such covenantsor other provisions at any future time, Products Corporation would needto seek an amendment or waiver of such financial covenants or otherprovisions. The lenders under the 2004 Credit Agreement may not consentto any amendment or waiver requests that Products Corporation may makein the future, and, if they do consent, they may not do so on termswhich are favorable to it and Revlon, Inc. In the event that ProductsCorporation was unable to obtain such a waiver or amendment and it wasnot able to refinance or repay its debt instruments, including the 2004Credit Agreement, Products Corporation’s inability to meet thefinancial covenants or other provisions would constitute an event ofdefault under its debt instruments, including the 2004 CreditAgreement, which would permit the bank lenders to accelerate the 2004Credit Agreement, which in turn would constitute an event of defaultunder the 2004 Consolidated MacAndrews & Forbes Line of Credit andthe indentures governing Products Corporation’s outstanding91⁄2% Senior Notes and8 5/8% Senior Subordinated Notes, if the amountaccelerated exceeds $25.0  million and such default remainsuncured for 10 days following notice from MacAndrews & Forbes withrespect to the 2004 Consolidated MacAndrews & Forbes Line of Creditor the trustee under the applicable indenture.

ProductsCorporation’s assets and/or cash flow and/or that of ProductsCorporation’s subsidiaries may not be sufficient to repay fullyborrowings under the outstanding debt instruments, either upon maturityor if accelerated upon an event of default, and if Products Corporationwas required to repurchase its outstanding 91⁄2%Senior Notes and/or 8 5/8% Senior SubordinatedNotes upon a change of control, Products Corporation may be unable torefinance or restructure the payments on such debt. Further, ifProducts Corporation was unable to repay, refinance or restructure itsindebtedness under the 2004 Credit Agreement, the lenders could proceedagainst the collateral securing that indebtedness.

**Limits on Products Corporation’s borrowing capacityunder the Multi-Currency Facility may affect the Company’sability to finance its operations.**

While the Multi-CurrencyFacility currently provides for up to $160.0  million ofcommitments, Products Corporation’s ability to borrow fundsunder this facility is limited by a borrowing base determined relativeto the value, from time to time, of eligible accounts receivable andeligible inventory in the U.S. and the U.K. and eligible real propertyand equipment in the U.S. If the value of these eligible assets is notsufficient to support the full $160.0  million borrowing base,Products Corporation will not have full access to the Multi-CurrencyFacility but rather could have access to a lesser amount determined bythe borrowing base. Further, if Products Corporation borrows fundsunder this facility, subsequent changes in the value or eligibility ofthe assets could cause Products Corporation to be required to pay downthe amounts outstanding so that there is no amount outstanding inexcess of the then-existing borrowing base. ProductsCorporation’s ability to make borrowings under theMulti-Currency Facility is also conditioned upon its compliance withother covenants in the 2004 Credit Agreement, including a fixed chargecoverage ratio that applies when the excess borrowing base is less than$30.0  million. Because of these limitations, Products Corporationmay not always be able to meet its cash requirements with fundsborrowed under the Multi-Currency Facility, which could have a materialadverse effect on the Company’s business, results of operationsor financial condition. On February  1,  2006, the Term LoanFacility was fully drawn, and availability under the Multi-CurrencyFacility, based upon the calculated borrowing base less approximately$16 million of outstanding letters of credit, was approximately$144  million, as the Multi-Currency Facility was undrawn at suchdate.

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A substantial portion of ProductsCorporation’s indebtedness is subject to floating interestrates.

A substantial portion of Products Corporation’sindebtedness, principally under the 2004 Credit Agreement, is subjectto floating interest rates, which makes the Company more vulnerable inthe event of adverse economic conditions, increases in prevailinginterest rates or a downturn in the Company’s business. As ofDecember  31,  2005, $709.0  million of ProductsCorporation’s total indebtedness was subject to floatinginterest rates. The Term Loan Facility and the Multi-Currency Facilityunder the 2004 Credit Agreement bear interest, at ProductsCorporation’s option, at either the Eurodollar Rate (as definedin the 2004 Credit Agreement), which is based on LIBOR, or theAlternate Base Rate (as defined in the 2004 Credit Agreement), which isbased on the greater of Citibank, N.A.'s announced base rate andthe U.S. federal fund rate plus 0.5%, or the equivalent forloans denominated in currencies other than U.S. dollars. If any ofLIBOR, the base rate, the U.S. federal funds rate or such equivalentlocal currency rate increases, the Company’s debt service costswill increase to the extent that Products Corporation has elected suchrates for its outstanding loans. Based on the amounts outstanding underthe 2004 Credit Agreement and other short-term borrowings (which, inthe aggregate, is Products Corporation’s only debt currentlysubject to floating interest rates) as of December  31,2005, an increase in LIBOR of 1% would increase theCompany’s annual interest expense by $7.1  million.Increased debt service costs would adversely affect theCompany’s cash flow. While Products Corporation may enter intovarious interest hedging contracts, it may not be able to do so on acost-effective basis, any hedging transactions it might enter into maynot achieve their intended purpose and shifts in interest rates mayhave a material adverse effect on the Company.

**TheCompany depends on its Oxford, North Carolina facility for productionof a substantial portion of its products. Disruptions to this facilitycould affect the Company’s sales and financialcondition.**

A substantial portion of the Company’sproducts are produced at its Oxford, North Carolina facility.Significant unscheduled downtime at this facility due to equipmentbreakdowns, power failures, natural disasters, weather conditionshampering delivery schedules or other disruptions, including thosecaused by transitioning manufacturing from other facilities primarilyto the Company’s Oxford, North Carolina facility, or any othercause could adversely affect the Company’s ability to provideproducts to its customers, which would affect the Company’ssales and financial condition. Additionally, if product sales exceedforecasts, the Company could, from time to time, not have an adequatesupply of products to meet customer demands, which could cause theCompany to lose sales.

The Company’s brand initiativesmay not be as successful as the Company anticipates in furthering itsgrowth objectives.

As described under‘‘Management’s Discussion and Analysis of FinancialCondition and Results of Operations — Overview — Overviewof Brand Initiatives,’’ the Company recently announced twobrand initiatives, one of which involves a complete relaunch of theAlmay brand and builds on Almay’s healthy beauty heritage andthe desire among consumers for simplicity and personalization and theother of which is focused on the more mature consumer and involves thelaunch of a complete line of cosmetics under a new brand name, **VitalRadiance**, that is designed to serve this affluent and growingconsumer demographic currently underserved in the marketplace.

The Company may not be successful in achieving its growthobjectives. Each of the elements of the brand initiatives carriessignificant risks, as well as the possibility of unexpectedconsequences, including:

|              |                                                                                                                              |
|--------------|------------------------------------------------------------------------------------------------------------------------------|
| •  | theacceptance of the brand initiatives by the Company’s retailcustomers may not be as high as the Company anticipates; |

|              |                                                                                                                |
|--------------|----------------------------------------------------------------------------------------------------------------|
| •  | sales of the new products to theCompany’s retail customers may not be as high as the Companyanticipates; |

|              |                                                                                                                                                                                                                                                                                                             |
|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company’smarketing strategies for the brand initiatives may be less effectivethan planned and may fail to effectively reach the targeted consumerbase or engender the desired consumption and the rate of purchases bythe Company’s consumers may not be as high as the Companyanticipates; |

|              |                                                                                                          |
|--------------|----------------------------------------------------------------------------------------------------------|
| •  | the Company’swall displays to showcase the new products may fail to achieve theirintended effects; |

15

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|              |                                                                                                           |
|--------------|-----------------------------------------------------------------------------------------------------------|
| •  | the Companymay experience product returns exceeding its expectations as a resultof the brand initiatives; |

|              |                                                                                                                                                                                                                                                                                                                                                                  |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | theCompany may incur costs exceeding its expectations as a result of thecontinued development and launch of the brand initiatives, including,for example, costs in connection with the purchase and installation ofnew wall displays and advertising and promotional expenses or othercosts, including trade support, related to launching the brandinitiatives; |

|              |                                                                                                                                                               |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company mayexperience a decrease in sales of certain of the Company’sexisting products as a result of the products related to the brandinitiatives; |

|              |                                                                                                                                                                                                                       |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company’sproduct pricing strategies for the brand initiatives may not beaccepted by its retail customers and/or its consumers, which may resultin the Company’s sales being less than it anticipates; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | any delays or other difficultiesimpacting the Company’s ability, or the ability of theCompany’s third party manufacturers and suppliers, to timelymanufacture, distribute and ship products in connection with launchingthe brand initiatives, such as inclement weather conditions or thosedelays or difficulties discussed under ‘‘— TheCompany depends on its Oxford, North Carolina facility for productionof a substantial portion of its products. Disruptions to this facilitycould affect the Company’s sales and financialcondition,’’ could affect the Company’s ability toship and deliver products to meet its retail customers’ resetdeadlines; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the brand initiativeswill require that the Company cause to be manufactured, shipped andinstalled new display walls at the Company’s retailcustomers’ stores in time for such customers’ resetschedules. Any delays or other difficulties impacting the manufacture,distribution and installation of these display walls could affect theCompany’s ability to meet its retail customers’ resetdeadlines; and |

|              |                                                                                                                                                                                                                                                                    |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | attempting toaccomplish all of the elements of the brand initiatives simultaneouslymay prove to be a financial and operational burden on the Company andthe Company may be unable to successfully accomplish all of theelements of the initiatives simultaneously. |

Each of the risksreferred to above could delay or impede the Company’s ability toachieve its growth objectives, which could have a material adverseeffect on the Company’s business, results of operations andfinancial condition.

**The Company’s ability toservice its debt and meet its cash requirements depends on manyfactors, including achieving anticipated levels of revenue growth andexpenses. If such levels prove to be other than as anticipated, theCompany may be unable to meet its cash requirements or ProductsCorporation may be unable to meet the requirements of the financialcovenants under the 2004 Credit Agreement, which could have a materialadverse effect on the Company’s business.**

The Companycurrently expects that operating revenues, cash on hand, net cashproceeds from the planned $75  million equity issuance describedin ‘‘Recent Developments’’ and funds availablefor borrowing under the 2004 Credit Agreement, the 2004 ConsolidatedMacAndrews & Forbes Line of Credit and other permitted lines ofcredit will be sufficient to enable the Company to cover its operatingexpenses for 2006, including cash requirements in connection with theCompany’s operations, the continued implementation of, andrefinement to, the Company’s plan, including with respect to theCompany’s brand initiatives, the Company’s debt servicerequirements for 2006, the organizational realignment described in‘‘Recent Developments’’ and regularly scheduledpension and post-retirement benefit plan contributions.

If theCompany’s anticipated level of revenue growth is not achieved,however, because of, for example, decreased consumer spending inresponse to weak economic conditions or weakness in the mass-marketcosmetics category, retailer inventory management, adverse changes incurrency, increased competition from the Company’s competitors,changes in consumer purchasing habits, including with respect toshopping channels, or because the Company’s advertising andmarketing plans or the brand initiatives are not as successful asanticipated, or if the Company’s expenses associated withcontinued implementation of, and refinement to, the Company’splan, including expenses related to the Company’s 

16

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brand initiatives, exceed the anticipatedlevel of expenses, the Company’s current sources of funds may beinsufficient to meet its cash requirements. In addition, suchdevelopments, if significant, could reduce the Company’srevenues and could adversely affect Products Corporation’sability to comply with certain financial covenants under the 2004Credit Agreement. If operating revenues, cash on hand, net cashproceeds from the planned $75  million equity issuance describedin ‘‘Recent Developments’’ and funds availablefor borrowing are insufficient to cover the Company’s expensesor are insufficient to enable Products Corporation to comply with thefinancial covenants under the 2004 Credit Agreement, the Company couldbe required to adopt one or more alternatives listed below. Forexample, the Company could be required to:

|              |                                                                                                                                                                                                  |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | delay the implementation of or revisecertain aspects of the Company’s plan, including potentiallydelaying, suspending or revising certain aspects of theCompany’s brand initiatives; |

|              |                                                                                                                                                                                                                |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | reduce or delay purchases of walldisplays or advertising or promotional expenses, including spending onnew wall displays anticipated to be undertaken in connection with theCompany’s brand initiatives; |

|              |                                                                                                     |
|--------------|-----------------------------------------------------------------------------------------------------|
| •  | reduce or delay capital spending,including in connection with the Company’s brandinitiatives; |

|              |                                                       |
|--------------|-------------------------------------------------------|
| •  | restructure ProductsCorporation’s indebtedness; |

|              |                            |
|--------------|----------------------------|
| •  | sell assets or operations; |

|              |                                                                                                                                            |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------|
| •  | delay, reduce or revise theCompany’s restructuring plans (including as described in‘‘Recent Developments’’); |

|              |                                                                                                                                                     |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | seek additional capital contributions orloans from MacAndrews & Forbes, Revlon, Inc., the Company’sother affiliates and/or third parties; |

|              |                                                                                       |
|--------------|---------------------------------------------------------------------------------------|
| •  | sell additional Revlon, Inc. securitiesor debt securities of Products Corporation; or |

|              |                                      |
|--------------|--------------------------------------|
| •  | reduce other discretionary spending. |

If the Company is required to take any of these actions, it couldhave a material adverse effect on its business, financial condition andresults of operations. In addition, the Company may be unable to takeany of these actions, because of a variety of commercial or marketfactors or constraints in Products Corporation’s debtinstruments, including, for example, market conditions beingunfavorable for an equity or debt issuance, additional capitalcontributions or loans not being available from affiliates and/or thirdparties, or that the transactions may not be permitted under the termsof the various debt instruments then in effect, because of restrictionson the incurrence of debt, incurrence of liens, asset dispositionsand/or related party transactions. Such actions, if ever taken, may notenable the Company to satisfy its cash requirements or enable ProductsCorporation to comply with the financial covenants under the 2004Credit Agreement if the actions do not result in savings or generate asufficient amount of additional capital, as the case may be.

The Company depends on a limited number of customers for a largeportion of its net sales and the loss of one or more of these customerscould reduce the Company’s net sales.

For 2005, 2004 and2003, Wal-Mart, Inc. and its affiliates accounted for approximately24.0%, 21.0%, and 20.6%, respectively, of theCompany’s worldwide net sales. The Company expects that for 2006and future periods, Wal-Mart and a small number of other customerswill, in the aggregate, continue to account for a large portion of theCompany’s net sales. As is customary in the consumer productsindustry, none of the Company’s customers is under an obligationto continue purchasing products from the Company in the future. Theloss of Wal-Mart or one or more of the Company’s other customersthat may account for a significant portion of the Company’s netsales, or any significant decrease in sales to these customers or anysignificant decrease in the Company’s retail display space inany of these customers' stores, could reduce the Company’snet sales and therefore could have a material adverse effect on theCompany’s business, financial condition and results ofoperations.

The Company may be unable to increase its salesthrough the Company’s primary distribution channels.

Although the U.S. mass-market for color cosmetics advanced3.2% for the year ended December  31,  2005, ascompared with 2004, the U.S. mass-market color cosmetics categorydeclined by 

17

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approximately 0.6% in 2004 from 2003and declined by approximately 1.1% in 2003 from 2002. In theU.S., mass volume retailers and chain drug and food stores currentlyare the primary distribution channels for the Company’sproducts. Additionally, other channels, including department stores,door-to-door and the internet, combined account for a significantamount of sales of cosmetics and beauty care products. A decrease inconsumer demand in the U.S. mass-market for color cosmetics, retailerinventory management and/or a change in consumers’ purchasinghabits, such as by buying more cosmetics and beauty care products inchannels in which the Company does not currently compete, could causethe Company to be unable to increase sales of its products throughthese distribution channels, which could reduce the Company’snet sales and therefore have a material adverse effect on theCompany’s business, financial condition and results ofoperations.

The Company has a limited operating history underits business plan, and it may not be successful or enable the Companyto achieve or maintain profitable operations.

The Company has alimited operating history under its three-phase business plan. If theCompany fails to successfully execute its plan, including if theCompany fails to successfully execute its brand initiatives, theCompany may not achieve the expected increases in its net sales orimprovements in its operating profit margin, which could adverselyaffect the Company’s profitability and liquidity. Additionally,it is possible that implementation of the plan may have unanticipatedconsequences that could be adverse to the Company’sbusiness.

Each of the components of the Company’s plancarries significant risks, as well as the possibility of unexpectedconsequences. Potential risks include:

|              |                                                                                                                         |
|--------------|-------------------------------------------------------------------------------------------------------------------------|
| •  | the Company’s attempts to makeits advertising and media more effective may fail to achieve theirintended effects; |

|              |                                                                                        |
|--------------|----------------------------------------------------------------------------------------|
| •  | changes to theCompany’s wall displays may fail to achieve their intendedeffects; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                 |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company may experienceproduct returns and/or other costs exceeding the Company’sexpectations as a result of new product introductions or brandlaunches, including as a result of the brand initiatives, or additionalrepositioning, repackaging and reformulating one or more of theCompany’s product lines or brands, or further refining theCompany’s approach to retail merchandising; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company may incur costs exceedingits expectations as a result of the roll out of wall displays,including costs in connection with rolling out new wall displays inconnection with the Company’s brand initiatives, or makingfurther refinements to the Company’s wall displays, or the walldisplays or refinements to such displays may fail to achieve theirintended effects; |

|              |                                                                                                                                                                                                                                                                                  |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | theCompany’s new product development process may not be assuccessful as contemplated, or consumers may not accept theCompany’s new product offerings to the degree envisioned,including products to be sold in connection with the Company’sbrand initiatives; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | theCompany’s competitors, some of which have greater resources thanthe Company, could increase their spending on advertising and media,increase their new product development spending or take other steps inresponse to the Company’s plan, including in response to itsbrand initiatives, which could impact the effectiveness of theCompany’s plan, including the effectiveness of its brandinitiatives, and the Company’s ability to achieve its objectiveof increased revenues and profitability over the long term; |

|              |                                                                                                                                                                                                                                                                                                           |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company may experience difficulties,delays or higher than expected costs in implementing its comprehensiveprogram to develop and train the Company’s employees with theobjective of improving its organizational capabilities or in attractingand retaining talented and experienced personnel; |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the Company may be unable to achieve itsgrowth objectives in connection with its brand initiatives or theCompany may experience difficulties, delays or higher than expectedcosts in implementing its brand initiatives, including as discussed in‘‘— The Company’s brand initiatives may not beas successful as the Company anticipates in furthering its growthobjectives;’’ and |

18

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|              |                                                                                                                                                                                                                     |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | attempts toaccomplish all of the elements of the Company’s plansimultaneously may prove to be financially or operationally burdensomeand may cause disruption or difficulties in the Company’sbusiness. |

(See ‘‘— The Company’sability to service its debt and meet its cash requirements depends onmany factors, including achieving anticipated levels of revenue growthand expenses. If such levels prove to be other than as anticipated, theCompany may be unable to meet its cash requirements or ProductsCorporation may be unable to meet the requirements of the financialcovenants under the 2004 Credit Agreement, which could have a materialadverse effect on the Company’s business’’ and‘‘— The Company’s brand initiatives may not beas successful as the Company anticipates in furthering its growthobjectives.’’).

**Unanticipatedcircumstances may adversely affect the Company’s assumptions andexpectations regarding the Company’s ‘‘DestinationModel’’.**

The Company’s‘‘Destination Model’’ is based upon itsexpectation that the Company will achieve an improvement in itsoperating profit margin as a result of improvements in various aspectsof the Company’s business, including, without limitation, in itsinternational supply chain, in its promotion redesign, in its cost ofgoods (due to various initiatives including value analyses, packaginginitiatives, strategic sourcing and make versus buy analyses), in itsproduct life cycle management, in its in-store merchandising and byleveraging the Company’s fixed cost structure and otherinitiatives, for an aggregate targeted operating profit margin ofapproximately 12% (measured as a percentage of gross sales) bythe end of 2008. Although the Company believes that these expectationsare reasonable and achievable, the Company may achieve less thanexpected savings from one or more of these initiatives, theCompany’s progress may not be spread ratably and the margintransformation initiatives may not be implemented successfully and/orother events and circumstances, such as difficulties, delays orunexpected costs in achieving those results, may occur which couldresult in the Company’s not achieving its‘‘Destination Model’’, achieving only a portionof it, or achieving it later than the Company expects. Additionally, ifproduct sales exceed forecasts, the Company’s focus on closelymanaging inventory levels could result, from time to time, in theCompany’s not having an adequate supply of products to meetconsumer demand, which would cause the Company to lose sales. Inaddition, if the Company experiences lower than expected sales, theCompany may experience difficulties or delays in achieving its targetedoperating profit margin.

Competition in the consumer productsbusiness could materially adversely affect the Company’s netsales and its market share.

The consumer products business ishighly competitive.The Company competes primarily on the basis of:

|              |                                                                                                  |
|--------------|--------------------------------------------------------------------------------------------------|
| •  | developing quality products withinnovative performance features, shades, finishes and packaging; |

|              |                                                             |
|--------------|-------------------------------------------------------------|
| •  | educating consumers on theCompany’s product benefits; |

|              |                                                                                                                                                   |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | anticipating and responding to changingconsumer demands in a timely manner, including the timing of newproduct introductions and line extensions; |

|              |                                                                                  |
|--------------|----------------------------------------------------------------------------------|
| •  | offering attractively priced products,relative to the product benefits provided; |

|              |                                         |
|--------------|-----------------------------------------|
| •  | maintaining favorable brandrecognition; |

|              |                                                                                                                                                                                                |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | generating competitivemargins and inventory turns for the Company’s retail customersby providing market-right products and executing effective pricing,incentive and promotion programs; |

|              |                                                                                                         |
|--------------|---------------------------------------------------------------------------------------------------------|
| •  | ensuring product availability througheffective planning and replenishment collaboration with retailers; |

|              |                                                                                            |
|--------------|--------------------------------------------------------------------------------------------|
| •  | providing strong and effectiveadvertising, marketing, promotion and merchandising support; |

|              |                                          |
|--------------|------------------------------------------|
| •  | maintaining an effective sales force;and |

19

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|              |                                                                                                                                           |
|--------------|-------------------------------------------------------------------------------------------------------------------------------------------|
| •  | obtainingsufficient retail floor space, optimal in-store positioning andeffective presentation of the Company’s products at retail. |

An increase in the amount of competition that the Company facescould have a material adverse effect on its market share and revenues.The Company experienced declines in its market share in the U.S.mass-market in color cosmetics from the end of the first half of 1998through the first half of 2002, including a decline in theCompany’s combined color cosmetics market share fromapproximately 32% in the second quarter of 1998 to approximately22% in the second quarter of 2002. From the second half of 2002through 2005, the Company’s U.S. mass-market share in colorcosmetics stabilized, and the Company achieved a combined U.S.mass-market share of 21.6% for 2005. The Revlon brand registereda U.S. mass-market share of 15.4% for 2005, while the Almaybrand advanced to 6.2% for 2005. It is possible that declines inthe Company’s market share could occur in the future.

Inaddition, the Company competes in selected product categories against anumber of multinational manufacturers, some of which are larger andhave substantially greater resources than the Company, and which maytherefore have the ability to spend more aggressively on advertisingand marketing and more flexibility to respond to changing business andeconomic conditions than the Company. In addition to products sold inthe mass-market, the Company’s products also compete withsimilar products sold in prestige department store channels,door-to-door, on the internet and through mail-order or telemarketingby representatives of direct sales companies.

**TheCompany’s foreign operations are subject to a variety of social,political and economic risks and may be affected by foreign currencyfluctuation, which could adversely affect the results of theCompany’s operations and the value of its foreignassets.**

As of December  31,  2005, the Company hadoperations based in 16 foreign countries and its products were sold inover 100 countries. The Company is exposed to the risk of changes insocial, political and economic conditions inherent in operating inforeign countries, including those in Asia, Eastern Europe and LatinAmerica, which could adversely affect the Company’s business,results of operations and financial condition. Such changes includechanges in the laws and policies that govern foreign investment incountries where the Company has operations, changes in consumerpurchasing habits including as to shopping channels, as well as, to alesser extent, changes in U.S. laws and regulations relating to foreigntrade and investment. In addition, fluctuations in foreign currencyexchange rates may affect the results of the Company’soperations and the value of its foreign assets, which in turn mayadversely affect the Company’s reported earnings and,accordingly, the comparability of period-to-period results ofoperations. Changes in currency exchange rates may affect the relativeprices at which the Company and its foreign competitors sell productsin the same markets. The Company’s net sales outside of the U.S.and Canada for the years ended December  31,  2005, 2004, and2003 were approximately 36%, 34% and 31% of theCompany’s total consolidated net sales, respectively. Inaddition, changes in the value of relevant currencies may affect thecost of certain items and materials required in the Company’soperations. Products Corporation enters into forward foreign exchangecontracts to hedge certain cash flows denominated in foreign currency.At December  31,  2005, the notional amount of ProductsCorporation’s foreign currency forward exchange contracts was$31.9  million. The hedges Products Corporation enters into maynot protect against currency fluctuations.

**Terroristattacks, acts of war or military actions may adversely affect themarkets in which the Company operates and the Company’soperations and profitability.**

On September  11,2001, the U.S. was the target of terrorist attacks of unprecedentedscope. These attacks contributed to major instability in the U.S. andother financial markets and reduced consumer confidence. Theseterrorist attacks, as well as terrorist attacks such as those that haveoccurred in Madrid, Spain and London, England, military responses toterrorist attacks and future developments, or other military actions,such as the military actions in Iraq, may adversely affect prevailingeconomic conditions, resulting in reduced consumer spending and reduceddemand for the Company’s products. These developments subjectthe Company’s worldwide operations to increased risks and,depending on their magnitude, could reduce net sales and thereforecould have a material adverse effect on the Company’s business,results of operations and financial condition.

20

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**The Company’s productsare subject to federal, state and international regulations that couldadversely affect the Company’s financial results.**

TheCompany is subject to regulation by the FTC and the FDA, in the U.S.,as well as various other federal, state, local and foreign regulatoryauthorities, including the EU in Europe. The Company’s Oxford,North Carolina manufacturing facility is registered with the FDA as adrug manufacturing establishment, permitting the manufacture ofcosmetics that contain over-the-counter drug ingredients, such assunscreens and antiperspirants. State and local regulations in the U.S.and regulations in the EU that are designed to protect consumers or theenvironment have an increasing influence on the Company’sproduct claims, ingredients and packaging. To the extent regulatorychanges occur in the future, they could require the Company toreformulate or discontinue certain of its products or revise itsproduct packaging or labeling, either of which could result in, amongother things, increased costs to the Company, delays in productlaunches or result in product returns.

**Shares ofRevlon, Inc. Class A Common Stock and Products Corporation’scapital stock are pledged to secure various of Revlon, Inc.’sand/or other of the Company’s affiliates’ obligations andforeclosure upon these shares or dispositions of shares could result inthe acceleration of debt under the 2004 Credit Agreement and could haveother consequences.**

Products Corporation’s shares ofcommon stock are pledged to secure Revlon, Inc.’s guaranteeunder the 2004 Credit Agreement. As of December  31,  2005,there were 2,325,291 shares of Class A Common Stock pledged by REVHoldings to secure $18.5  million principal amount of REVHoldings’ 13% Senior Secured Notes due 2007. MacAndrews& Forbes has advised the Company that it has pledged additionalshares of Class A Common Stock to secure other obligations. Additionalshares of Revlon, Inc. and shares of common stock of intermediateholding companies between Revlon, Inc. and MacAndrews & Forbes mayfrom time to time be pledged to secure obligations of MacAndrews &Forbes. A default under any of these obligations that are secured bythe pledged shares could cause a foreclosure with respect to suchshares of Class A Common Stock, Products Corporation’s commonstock or stock of intermediate holding companies. A foreclosure uponany such shares of common stock or dispositions of shares of Class ACommon Stock, Products Corporation's common stock or stock ofintermediate holding companies beneficially owned by MacAndrews &Forbes could, in a sufficient amount, constitute a "changeof control" under the 2004 Credit Agreement, the 2004Consolidated MacAndrews & Forbes Line of Credit and the indenturesgoverning the 91⁄2% Senior Notes and the8 5/8% Senior Subordinated Notes. A change ofcontrol constitutes an event of default under the 2004 CreditAgreement, which would permit Products Corporation’s lenders toaccelerate amounts outstanding under the 2004 Credit Agreement. Inaddition, holders of the 91⁄2% Senior Notes andthe 8 5/8% Senior Subordinated Notes may requireProducts Corporation to repurchase their respective notes under thosecircumstances. Products Corporation may not have sufficient funds atthe time of any such change of control to repay in full the borrowingsunder the 2004 Credit Agreement or to repurchase or redeem the91⁄2% Senior Notes and/or the8 5/8% Senior Subordinated Notes. (See‘‘The Company’s ability to service its debt and meetits cash requirements depends on many factors, including achievinganticipated levels of revenue growth and expenses. If such levels proveto be other than as anticipated, the Company may be unable to meet itscash requirements or Products Corporation may be unable to meet therequirements of the financial covenants under the 2004 CreditAgreement, which could have a material adverse effect on theCompany’s business.’’).

MacAndrews &Forbes has the power to direct and control the Company’sbusiness.

MacAndrews & Forbes is wholly owned by Ronald O.Perelman. Mr.  Perelman, directly and through MacAndrews &Forbes, beneficially owns approximately 60% of Revlon,Inc.’s outstanding common stock. Mr.  Perelman, directlyand through MacAndrews & Forbes, controls approximately 77%of the combined voting power of Revlon, Inc.’s common stock. Asa result, MacAndrews & Forbes is able to control the election ofthe entire Board of Directors of Revlon, Inc. and Products Corporationand controls the vote on all matters submitted to a vote of Revlon,Inc.’s and Products Corporation’s stockholders, includingthe approval of mergers, consolidations, sales of some, all orsubstantially all of Revlon, Inc.’s or ProductsCorporation’s assets, issuances of capital stock and similartransactions.

21

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**New accounting requirementswill cause the Company to record compensation expense for employeestock option grants, which will affect the Company’s reportedearnings.**

In December  2004, the FASB issued SFAS No.123 (revised 2004), ‘‘Share-Based Payment,’’ anamendment to FASB Statements Nos. 123 and 95 (‘‘SFAS No.123(R)’’), which replaces SFAS No. 123, and supercedes APBOpinion No. 25, ‘‘Accounting for Stock Issued toEmployees.’’ SFAS No. 123(R) requires all share-basedpayments to employees, including grants of employee stock options, tobe recognized in the financial statements based on their fair values.In April  2005, the U.S. Securities and Exchange Commission (the‘‘SEC’’ or the‘‘Commission’’) adopted a rule allowingcompanies to implement SFAS No. 123(R) at the beginning of their nextfiscal year that begins after June  15,  2005, which for theCompany will be effective beginning January  1,  2006. TheCompany will use the modified prospective transition method, utilizingthe Black-Scholes option pricing model for the calculation of the fairvalue of its employee stock options. Under the modified prospectivemethod, stock option awards that are granted, modified or settled afterJanuary  1,  2006 will be measured and accounted for inaccordance with SFAS No. 123(R). Compensation cost for stock optionawards granted prior to, but not vested, as of January  1,2006 would be based on the grant date attributes originally used tovalue those awards for pro forma purposes under SFAS No. 123. TheCompany expects the adoption of SFAS No. 123(R) will result inapproximately $10  million in additional expenses for fiscal year2006. This estimate is based on the number of unvested optionsoutstanding as of January 1, 2006 and the estimated number of optionsto be granted in 2006. This estimate could change based on a number offactors, including differences in the estimate of the number of optionsgranted before 2006 which are forfeited during 2006 and the number ofoptions actually granted in 2006 and the fair value of these options attheir grant date.

Item 1B.    Unresolved Staff Comments

None.

Item 2.    Properties

The following tablesets forth as of December  31,  2005 the Company's majormanufacturing, research and warehouse/distribution facilities, all ofwhich are owned except where otherwise noted.

|                           |  |                                                        |  |                               |           |        |  |  |  |  |
|---------------------------|--|--------------------------------------------------------|--|-------------------------------|-----------|--------|--|--|--|--|
| Location                  |  | Use                                                    |  | Approximate FloorSpace Sq.Ft. |
| Oxford, North Carolina    |  | Manufacturing,warehousing, distribution and office (a) |  |                          | 1,012,000 |   |
| Edison, New Jersey        |  | Research and office (leased)                           |  |                          | 123,000   |   |
| Irvington, New Jersey.    |  | Manufacturing, warehousing and office (a)              |  |                          | 96,000    |   |
| Mexico City, Mexico       |  | Manufacturing, distribution and office                 |  |                          | 150,000   |   |
| Caracas, Venezuela        |  | Manufacturing, distribution andoffice                  |  |                          | 145,000   |   |
| Kempton Park, SouthAfrica |  | Warehousing, distribution and office (leased)          |  |                          | 120,000   |   |
| Canberra, Australia       |  | Warehousing, distribution and office (leased)          |  |                          | 125,000   |   |
| Rietfontein, South Africa |  | Manufacturing, warehousing, distribution and office    |  |                          | 94,000    |   |
|                           |

|  |
|--|
|  |  |
|  |

|     |                                                             |
|-----|-------------------------------------------------------------|
| (a) | Propertiessubject to liens under the 2004 Credit Agreement. |

Inaddition to the facilities described above, the Company owns and leasesadditional facilities in various areas throughout the world, includingthe lease for the Company's executive offices in New York, NewYork (approximately 176,800 square feet). Management considers theCompany's facilities to be well-maintained and satisfactory forthe Company's operations, and believes that the Company'sfacilities and third party contractual supplier arrangements providesufficient capacity for its current and expected productionrequirements.

Item 3.    Legal Proceedings

TheCompany is involved in various routine legal proceedings incident tothe ordinary course of its business. The Company believes that theoutcome of all pending legal proceedings in the aggregate is unlikelyto have a material adverse effect on the business or consolidatedfinancial condition of the 

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Company. A purported class action lawsuitwas filed on September  27,  2000, in the United StatesDistrict Court for the Southern District of New York on behalf of DanGavish, Tricia Fontan and Walter Fontan individually and allegedly onbehalf of all others similarly situated who purchased the securities ofRevlon, Inc. and REV Holdings Inc. (a Delaware corporation and thepredecessor of REV Holdings LLC, a Delaware limited liability company(‘‘REV Holdings’’)) between October2,  1998 and September  30,  1999 (the‘‘Second Gavish Action’’). The complaint,amended by the plaintiffs in November  2001, alleged, among otherthings, that Revlon, Inc., certain of its present and former officersand directors and REV Holdings Inc. violated, among other things, Rule10b-5 under the Securities Exchange Act of 1934, as amended (the‘‘Exchange Act’’). On September  29,2004, the United States District Court for the Southern District of NewYork dismissed the Second Gavish Action, without prejudice. Revlon,Inc.’s counsel has subsequently received a second amendedcomplaint. If this matter is pursued, Revlon, Inc. intends to defend itvigorously as the Company believes it is without merit. In light of thesettlement of the defendants' insurance claim for this matter andthe other purported class actions filed in 1999 and settled inJune  2003, which the Company recorded in 2002, the Company doesnot expect to incur any further expense in this matter.

Item4.    Submission of Matters to a Vote of Security Holders

Nomatter was submitted to a vote of security holders during the fourthquarter of the fiscal year covered by thisreport.

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PART II

|               |                                                                                                            |
|---------------|------------------------------------------------------------------------------------------------------------|
| Item 5.  | Market for Registrant'sCommon Equity, Related Stockholder Matters and Issuer Purchases ofEquity Securities |

MacAndrews & Forbes, which is whollyowned by Ronald O. Perelman, beneficially owns (i) 190,160,641 sharesof Class A Common Stock (20,819,333 of which are owned by REV Holdingsand 169,341,308 of which are beneficially owned by MacAndrews &Forbes) and (ii) all of the outstanding 31,250,000 shares of Class BCommon Stock of Revlon, Inc., with a par value of $0.01 per share (the‘‘Class B Common Stock’’, and together with theClass A Common Stock, the ‘‘Common Stock’’).Based on the shares referenced in clauses (i) and (ii) above, andincluding Mr.  Perelman's vested stock options discussed inPart III, Item 12. of this Form 10-K (‘‘Security Ownershipof Certain Beneficial Owners and Management’’), Mr.Perelman, directly and indirectly, through MacAndrews & Forbes, atDecember  31,  2005, beneficially owned approximately60% of Revlon, Inc.'s outstanding shares of Common Stockand had approximately 77% of the combined voting power of theoutstanding shares of Revlon, Inc.'s Common Stock currentlyentitled to vote at its 2006 Annual Meeting of Stockholders. Theremaining 150,265,777 shares of Class A Common Stock outstanding atDecember  31,  2005 were owned by the public. Revlon,Inc.'s Class A Common Stock is listed and traded on the New YorkStock Exchange (the ‘‘NYSE’’). As ofDecember  31,  2005, there were 920 holders of record ofClass A Common Stock. No dividends were declared or paid during 2005 or2004 by Revlon, Inc. on its Common Stock. The terms of the 2004 CreditAgreement, the 2004 Consolidated MacAndrews & Forbes Line ofCredit, the 8 5/8% Senior Subordinated Notes andthe 91⁄2% Senior Notes currently restrict theability of Products Corporation to pay dividends or make distributionsto Revlon, Inc., except in limited circumstances. (See Part III, Item12. of this Form 10-K, ‘‘Security Ownership of CertainBeneficial Owners and Management’’, and theCompany’s Consolidated Financial Statements and the Notesthereto).

The table below shows the high and low quarterly stockprices of Revlon, Inc.'s Class A Common Stock on the NYSE for theyears ended December  31,  2005 and 2004.

|        |  |                                  |      |             |  |             |      |             |  |        |      |        |  |        |      |        |  |  |
|--------|--|----------------------------------|------|-------------|--|-------------|------|-------------|--|--------|------|--------|--|--------|------|--------|--|--|
|   |  | YearEnded December  31,  2005(1) |
|   |  | 1st Quarter                      |      | 2nd Quarter |  | 3rd Quarter |      | 4th Quarter |
| High   |  | $                                | 3.08 |        |  | $           | 3.39 |        |  | $      | 4.29 |   |  | $      | 3.38 |   |
| Low    |  |                             | 2.20 |        |  |        | 2.70 |        |  |   | 3.00 |   |  |   | 2.33 |   |
|        |

|        |  |                                  |      |             |  |             |      |             |  |        |      |        |  |        |      |        |  |  |
|--------|--|----------------------------------|------|-------------|--|-------------|------|-------------|--|--------|------|--------|--|--------|------|--------|--|--|
|   |  | YearEnded December  31,  2004(1) |
|   |  | 1st Quarter                      |      | 2nd Quarter |  | 3rd Quarter |      | 4th Quarter |
| High   |  | $                                | 3.66 |        |  | $           | 3.50 |        |  | $      | 2.94 |   |  | $      | 2.55 |   |
| Low    |  |                             | 2.28 |        |  |        | 2.70 |        |  |   | 2.11 |   |  |   | 2.06 |   |
|        |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Representsthe closing price per share of Revlon, Inc.'s Class A Common Stockon the NYSE. The Company's stock trading symbol is‘‘REV’’. |

|              |                         |
|--------------|-------------------------|
| Item6.  | Selected Financial Data |

The ConsolidatedStatements of Operations Data for each of the years in the five-yearperiod ended December  31,  2005 and the Balance Sheet Dataas of December  31,  2005, 2004, 2003, 2002 and 2001 arederived from the Company’s Consolidated Financial Statements,which have been audited by KPMG LLP, an independent registered publicaccounting firm. The Selected Consolidated Financial Data should beread in conjunction with the Company's Consolidated FinancialStatements and the Notes to the Consolidated Financial Statements and‘‘Management's Discussion and Analysis of FinancialCondition and Results of Operations.’’

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|                                                                                         |  |                                                               |         |           |  |          |         |           |  |         |         |         |  |        |         |         |  |        |         |         |  |  |
|-----------------------------------------------------------------------------------------|--|---------------------------------------------------------------|---------|-----------|--|----------|---------|-----------|--|---------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                                                                    |  | YearEnded December  31,(in millions, except per shareamounts) |
|                                                                                    |  | 2005 (a)                                                      |         | 2004      |  | 2003 (b) |         | 2002 (b)  |  | 2001(c) |
| **Statement of OperationsData:**                                                        |  |                                                          |    |      |  |     |    |      |  |    |    |    |  |   |    |    |  |   |    |    |
| Netsales                                                                                |  | $                                                             | 1,332.3 |      |  | $        | 1,297.2 |      |  | $       | 1,299.3 |    |  | $      | 1,119.4 |    |  | $      | 1,277.6 |    |
| Gross profit(d)                                                                         |  |                                                          | 824.2   |      |  |     | 811.9   |      |  |    | 798.2   |    |  |   | 615.7   |    |  |   | 733.4   |    |
| Selling, general and administrativeexpenses                                             |  |                                                          | 757.8   |      |  |     | 717.6   |      |  |    | 770.9   |    |  |   | 717.0   |    |  |   | 679.2   |    |
| Restructuring costs andother, net (e)                                                   |  |                                                          | 1.5     |      |  |     | 5.8     |      |  |    | 6.0     |    |  |   | 13.6    |    |  |   | 38.1    |    |
| Operating income (loss)                                                                 |  |                                                          | 64.9    |      |  |     | 88.5    |      |  |    | 21.3    |    |  |   | (114.9  | )  |  |   | 16.1    |    |
| Interest Expense                                                                        |  |                                                          | 130.0   |      |  |     | 130.8   |      |  |    | 174.5   |    |  |   | 159.0   |    |  |   | 140.5   |    |
| Loss on early extinguishment of debt                                                    |  |                                                          | 9.0     | (f)  |  |     | 90.7    | (g)  |  |    | — |    |  |   | — |    |  |   | 3.6     |    |
| Loss from continuingoperations                                                          |  |                                                          | (83.7   | )    |  |     | (142.5  | )    |  |    | (153.8  | )  |  |   | (286.5  | )  |  |   | (153.7  | )  |
| Basic and diluted lossfrom continuing operations per common share                       |  | $                                                             | (0.23   | )    |  | $        | (0.47   | )    |  | $       | (2.47   | )  |  | $      | (5.36   | )  |  | $      | (2.87   | )  |
| Weighted averagenumber of common shares outstanding (in millions): (h) Basic anddiluted |  |                                                          | 371.1   |      |  |     | 301.1   |      |  |    | 62.3    |    |  |   | 53.5    |    |  |   | 53.5    |    |
|                                                                                         |

|                                     |  |                                      |          |         |  |          |          |          |  |        |          |         |  |        |          |         |  |        |          |         |  |  |
|-------------------------------------|--|--------------------------------------|----------|---------|--|----------|----------|----------|--|--------|----------|---------|--|--------|----------|---------|--|--------|----------|---------|--|--|
|                                |  | YearEnded December  31,(in millions) |
|                                |  | 2005 (a)                             |          | 2004    |  | 2003 (b) |          | 2002 (b) |  | 2001   |
| **Balance SheetData:**              |  |                                 |     |    |  |     |     |     |  |   |     |    |  |   |     |    |  |   |     |    |
| Totalassets                         |  | $                                    | 1,043.7  |    |  | $        | 1,000.5  |     |  | $      | 892.2    |    |  | $      | 933.7    |    |  | $      | 997.6    |    |
| Total indebtedness                  |  |                                 | 1,422.4  |    |  |     | 1,355.3  |     |  |   | 1,897.5  |    |  |   | 1,775.1  |    |  |   | 1,661.1  |    |
| Total stockholders’deficiency |  |                                 | (1,095.9 | )  |  |     | (1,019.9 | )   |  |   | (1,725.6 | )  |  |   | (1,638.5 | )  |  |   | (1,282.1 | )  |
|                                     |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | Resultsfor 2005 include expenses of approximately $44  million inincremental returns and allowances and approximately $7  millionin accelerated amortization cost of certain permanent displays relatedto the launch of the brand initiatives. |

|     |                                                                                                                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | Results for 2003 and2002 include expenses of approximately $31.0  million in 2003 andapproximately $104.0  million in 2002 related to the acceleratedimplementation of the Stabilization and Growth Phase of theCompany's plan. |

|     |                                                                                                                                                                                                                                   |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | In July  2001, theCompany completed the disposition of the Colorama brand and facility inBrazil. Accordingly, the selected financial data includes the resultsof operations of the Colorama brand through the date ofdisposition. |

|     |                                                                                                                                                                                                                                                                                                                                                                                               |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (d) | In connection with theCompany's restructuring activities described in note (e) below,through 2002 the Company incurred additional costs associated with theconsolidation of its Phoenix and Canada facilities and its worldwideoperations. The Company recorded $1.5  million and $38.2million of such costs for the years ended December  31,  2002and 2001, respectively, in cost of sales. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (e) | In 2000, the Companyinitiated a new restructuring program (the ‘‘2000restructuring program’’), to improve profitability byreducing personnel and consolidating manufacturing facilities. The 2000restructuring program focused on closing manufacturing operations inPhoenix, Arizona and Mississauga, Canada and consolidating productioninto the Company's plant in Oxford, North Carolina. The 2000restructuring program also included the remaining obligation for excessleased real estate at the Company's headquarters, consolidationcosts associated with closing the Company's facility in NewZealand and the elimination of several domestic and internationalexecutive and operational positions, each of which was effected toreduce and streamline corporate overhead costs. Restructuring expensesincurred through 2005 were with respect to the 2000 restructuringprogram, the continued consolidation of the Company's worldwideoperations or one-time restructuring events including employeeseverance costs. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (f) | The loss on earlyextinguishment of debt for 2005 includes: (i) a $5.0  millionprepayment fee related to the prepayment in March  2005 of$100.0  million of indebtedness outstanding under the Term LoanFacility of the 2004 Credit Agreement with a portion of the proceedsfrom the issuance of Products Corporation's Original91⁄2% Senior Notes and (ii) the aggregate$1.5  million loss on the redemption of ProductsCorporation’s 8 1/8% Senior Notes and9% Senior Notes in April  2005, as well as the write-off ofthe portion of deferred financing costs related to such prepaidamount. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (g) | Represents the loss onthe exchange of equity for certain indebtedness in the Revlon ExchangeTransactions (as hereinafter defined) and fees, expenses, premiums andthe write-off of deferred financing costs related to the RevlonExchange Transactions, the tender for and redemption of the 12%Senior Secured Notes (including the applicable premium) and therepayment of the 2001 Credit Agreement. (See Note 9 to the ConsolidatedFinancial Statements). |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (h) | Represents the weightedaverage number of common shares outstanding for the period. Uponconsummation of Revlon, Inc.’s rights offering in 2003, the fairvalue, based on NYSE closing price of Revlon, Inc.'s Class ACommon Stock was more than the subscription price. Accordingly, basicand diluted loss per common share have been restated for all periodsprior to the rights offering in 2003 to reflect the stock dividend of1,262,328 shares of Class A Common Stock. (See Note 1 to theConsolidated Financial Statements). On March  25,  2004, inconnection with the Revlon Exchange Transactions, Revlon, Inc. issued299,969,493 shares of Class A Common Stock. (See Note 9 to theConsolidated Financial Statements). The shares issued in the RevlonExchange Transactions are included in the weighted average number ofshares outstanding since the date of the respective transactions. Inaddition, if upon consummation of Revlon, Inc.’s rights offeringin 2006 as referred to in ‘‘RecentDevelopments’’, the fair value, based on NYSE closing priceof Revlon, Inc.'s Class A Common Stock on the consummation date ismore than the subscription price, the basic and diluted loss per commonshare will be restated for all prior periods presented to such 2006rights offering to reflect the implied stock dividend. |

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Item 7.    Management's Discussionand Analysis of Financial Condition and Results of Operations

Overview

Overview of the Business

TheCompany is providing this overview in accordance with the SEC'sDecember  2003 interpretive guidance regarding Management'sDiscussion and Analysis of Financial Condition and Results ofOperations.

Revlon, Inc. (and together with its subsidiaries,the ‘‘Company’’) conducts its businessexclusively through its wholly-owned operating subsidiary, RevlonConsumer Products Corporation (‘‘ProductsCorporation’’), which operates in a single segment andmanufactures, markets and sells an extensive array of cosmetics,skincare, fragrances and personal care products. **Revlon** is oneof the world's leading mass-market cosmetics brands. **Revlon**believes that its global brand name recognition, product quality andmarketing experience have enabled it to create one of the strongestconsumer brand franchises in the world. The Company's products aresold worldwide and marketed under such brand names as **Revlon,ColorStay, Fabulash, Super Lustrous**and**Revlon Age Defying**makeup with**Botafirm**, as well as the newly relaunched**Almay** brand, including the Company’s new **Almay Intensei-Color** collection, and the Company’s latest brand, **VitalRadiance,** in cosmetics; a new **Almay**skincare line, as wellas **Ultima II** and **Gatineau** in skincare; **Charlie**and**Jean Naté** in fragrances; **Revlon**and**Expert Effects** in beauty tools; and **Mitchum, Flex, Colorsilk**and **Bozzano** in personal care products. In addition, theCompany has a licensing group pursuant to which the Company licensescertain of its key brand names to third parties for complimentarybeauty-related products and accessories.

The Company is anindirectly majority-owned subsidiary of MacAndrews & ForbesHoldings Inc. (‘‘MacAndrews & ForbesHoldings’’ and, together with its affiliates,‘‘MacAndrews & Forbes’’), a corporationwholly-owned by Ronald O. Perelman.

Overview of theCompany’s Plan

The Company is in the third phase ofits plan, the Accelerated Growth Phase.

The Company intends tocapitalize on the actions taken during the earlier phases of the plan,with the objective of increasing revenues and achieving profitabilityover the long term. The Accelerated Growth Phase of the plan includesvarious actions that represent refinements of and additions to theactions taken during the earlier phases of the plan, with the objectiveof balancing top-line growth with an improved operating profit margin.These ongoing initiatives include, among other things, actions to: (i)further improve the new product development and introduction processwith even deeper insights into the Company’s consumers and thecategories in which it competes; (ii)  continue to increase theeffectiveness and reduce the cost of the Company's display wallsacross categories and brands; (iii) drive efficiencies across theCompany's overall supply chain, including reducing manufacturingcosts by continuing to rationalize components and by sourcingstrategically; (iv) optimize the effectiveness of the Company’sadvertising, marketing and promotions; (v) continue the training anddevelopment of the organization so that the Company may continue toimprove its capabilities to execute its strategies while providingenhanced job satisfaction for the Company’s employees; and (vi)continue to strengthen the Company’s balance sheet and capitalstructure, much of which has been accomplished during 2004, withadditional financing transactions completed during 2005 and planned for2006. (See ‘‘Recent Developments’’ regardingRevlon, Inc.'s planned $110  million rights offering andplanned $75  million equity issuance).

The Company believesthat it has strengthened its organizational capabilities and it intendsto continue doing so. The Company also believes that it hasstrengthened its relationships with its key retailers in the U.S.

Overview of Brand Initiatives

In August2005, the Company announced two major brand initiatives. One initiativeinvolves a complete relaunch of the Almay brand and builds onAlmay’s healthy beauty heritage and the desire 

26

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among consumers for simplicity andpersonalization. The second initiative is focused on the more matureconsumer and involves the launch of a complete line of cosmetics undera new brand name, **Vital Radiance**, that is designed to serve thisaffluent and growing consumer demographic currently underserved in themarketplace.

The brand initiatives had a positive effect on netsales of approximately $33  million in 2005, after giving effectto approximately $44  million of provisions for incrementalreturns and allowances associated with the launch of these initiatives.As a result of these brand initiatives, the Company had acceleratedamortization associated with certain existing retail display fixturesof approximately $7  million that impacted selling, general andadministrative expenses (‘‘SG&A’’) in 2005.The total upfront launch and related costs of the brand initiatives in2005 was approximately $62  million, principally includingprovisions for the aforementioned incremental returns and allowances ofapproximately $44  million and the aforementioned $7  millionof accelerated amortization. The Company also currently expects thatthe first quarter of 2006 would benefit from the incremental initialshipments associated with the launch of these brand initiatives.

The Company continues to make certain investments in connection withthese brand initiatives, most notably in the area of permanent displaysand inventory. In terms of the cash flow impact of these brandinitiatives, the Company’s investment in permanent displays,including displays for its existing businesses and these brandinitiatives, was approximately $70  million for 2005 and theCompany expects that its continued investment in permanent displayswill be in the range of $85  million to $95  million for2006, returning to more normalized levels thereafter. The net increasein 2005 inventory levels of approximately $66  million and theincrease in 2005 net trade receivables of approximately $82million, as compared with that of 2004, is primarily due to the brandinitiatives. The Company’s working capital is expected to returnto more normalized levels in relation to sales during the second halfof 2006.

Overview of Sales and Earnings Results

Net sales in 2005 increased $35.1  million to $1,332.3million, as compared with $1,297.2  million in 2004, driven byhigher shipments and favorable foreign currency translation, partiallyoffset by higher total returns, allowances and discounts and lowerlicensing revenue primarily as a result of the prepayment of certainminimum royalties and renewal fees by licensees in 2004.

In theUnited States and Canada, 2005 net sales increased $1.4  millionto $857.1  million from $855.7  million in 2004. Excludingthe impact of Canadian currency fluctuations, net sales were down$3.2  million. This decrease was primarily due to a decline in netsales of certain of the Company’s base business products and adecrease in licensing revenue from 2004 levels which included theprepayments of certain minimum royalties and renewal fees by licensees,partially offset by an increase in new product net sales due in part tothe brand initiatives. In International, 2005 net sales increased$33.7  million to $475.2  million from $441.5  millionin 2004. The increase in 2005 was due primarily to higher shipments andfavorable foreign currency translation.

Net loss in 2005decreased $58.8  million to $83.7  million, as compared with$142.5  million in 2004. The improvement in net loss for 2005, ascompared with 2004, reflected a decrease of approximately $82million in expenses relating to the early extinguishment of debt,higher product shipments, due principally to the brand initiatives, andfavorable foreign currency impact. These improvements were partiallyoffset by the decrease in the aforementioned licensing revenues and theadditional costs incurred relating to the launch of the brandinitiatives, including a charge for incremental returns and allowances,plus additional costs incurred for advertising, which includes expensesincurred for promotional displays and accelerated depreciation oncertain existing permanent displays.

Overview of MarketShare Data

In terms of U.S. marketplace performance, theU.S. color cosmetics category for 2005 increased approximately3.2% versus 2004. Combined U.S. mass-market share for the Revlonand Almay brands totaled 21.6% for 2005, compared with21.4% for 2004, with the Revlon brand registering a shareof 15.4% for 2005, compared with 15.7% for 2004, and theAlmay brand registering a share of 6.2% for 2005, 

27

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compared with 5.7% for 2004.The share increase for the Almay brand was driven primarily by thesuccessful launch of new products, including the Almay Intense i-Colorcollection. In women’s hair color and beauty tools, the Companygained market share in 2005, compared with 2004, increasing,respectively, from a 8.0% market share for 2004 to 8.5%for 2005, and 24.1% market share for 2004 to 25.0% for2005. Market share performance was essentially even at 6.2% foranti-perspirants/deodorants in 2004 and 2005.

Overview ofFinancing Activities

The Accelerated Growth Phase of theCompany’s plan include actions intended to, among other things,strengthen the Company's balance sheet and capital structure, muchof which actions were accomplished during 2005 and 2004. (See‘‘Financial Condition, Liquidity and Capital Resources– 2004 Refinancing Transactions’’ for a discussion ofthe 2004 financing transactions).

In March  2005, ProductsCorporation issued in a private placement $310.0  millionaggregate principal amount of 91⁄2% Senior Notesdue 2011 (the ‘‘Original 91⁄2%Senior Notes’’) and used the proceeds to prepay andpermanently reduce $100.0  million of indebtedness under the TermLoan Facility of Products Corporation’s 2004 Credit Agreement,to redeem its 8 1/8% Senior Notes and 9%Senior Notes and to pay the applicable redemption premiums, fees,expenses and accrued interest related to these transactions. Thisissuance and the related transactions extended the maturities ofProducts Corporation's debt that would have otherwise been due in2006. In June  2005, all of the Original91⁄2% Senior Notes were exchanged for new91⁄2% Senior Notes (the ‘‘March 200591⁄2% Senior Notes’’), which havesubstantially identical terms to the Original91⁄2% Senior Notes, except that they areregistered with the SEC under the Securities Act of 1933, as amended(the ‘‘Securities Act’’), and the transferrestrictions and registration rights applicable to the Original91⁄2% Senior Notes do not apply to theMarch  2005  91⁄2% Senior Notes. (Seefurther discussion in ‘‘2005 RefinancingTransactions’’ within this section and in Note 9,‘‘Long-Term Debt’’, to the ConsolidatedFinancial Statements).

In August  2005, ProductsCorporation issued in a private placement $80.0  million aggregateprincipal amount of additional 91⁄2% SeniorNotes due 2011 (the ‘‘Additional91⁄2% Senior Notes’’). The Companyused the proceeds of such issuance to help fund investments in itsbrand initiatives and for general corporate purposes, as well as to payfees and expenses in connection with the issuance of the Additional91⁄2% Senior Notes. In December  2005, allof the Additional 91⁄2% Senior Notes wereexchanged for new 91⁄2% Senior Notes (the‘‘August 2005 91⁄2% SeniorNotes’’ and together with the March  200591⁄2% Senior Notes, the‘‘91⁄2% Senior Notes’’),which have substantially identical terms to the Additional91⁄2% Senior Notes, except that they areregistered with the SEC under the Securities Act, and the transferrestrictions and registration rights applicable to the Additional91⁄2% Senior Notes do not apply to theAugust  2005  91⁄2% Senior Notes. (Seefurther discussion in ‘‘2005 RefinancingTransactions’’ within this section and in Note 9‘‘Long-Term Debt’’ to the ConsolidatedFinancial Statements).

Also in August  2005, Revlon, Inc.announced its plan to issue $185.0  million of equity with theproceeds from approximately $110  million of this issuance to becontributed to Products Corporation to reduce its debt and the balanceof the proceeds to be available to Products Corporation for generalcorporate purposes. (See ‘‘RecentDevelopments’’ and ‘‘2005 RefinancingTransactions’’ within this section for furtherdiscussion).

In December  2005, the SEC declared effectiveRevlon, Inc.’s ‘‘shelf’’ registrationstatement on Form S-3 registering up to $250.0  million of avariety of equity securities, including (a) Class A Common Stock, (b)preferred stock, (c) warrants to purchase Class A Common Stock orpreferred stock, (d) stock purchase contracts (representing contractsobligating holders to purchase from Revlon, Inc. and Revlon, Inc. tosell to the holders, certain shares of Class A Common Stock orpreferred stock at future dates), (e) stock purchase units (whichconsist of a stock purchase contract and/or warrants that would securethe holder’s obligation to purchase or sell Class A Common Stockor preferred stock), and (f) subscription rights to purchase Class ACommon Stock or preferred stock. (See ‘‘RecentDevelopments’’).

Discussion of Critical AccountingPolicies

In the ordinary course of its business, the Companyhas made a number of estimates and assumptions relating to thereporting of results of operations and financial condition in thepreparation of its financial 

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statements in conformity with accountingprinciples generally accepted in the U.S. Actual results could differsignificantly from those estimates and assumptions. The Companybelieves that the following discussion addresses the Company'smost critical accounting policies, which are those that are mostimportant to the portrayal of the Company's financial conditionand results and require management's most difficult, subjectiveand complex judgments, often as a result of the need to make estimatesabout the effect of matters that are inherently uncertain.

Sales Returns:

The Company allows customers to return theirunsold products when they meet certain company-established criteria asoutlined in the Company’s trade terms. The Company regularlyreviews and revises, when deemed necessary, the Company’sestimates of sales returns based primarily upon actual returns, plannedproduct discontinuances, and promotional sales, which would permitcustomers to return items based upon the Company’s trade terms.The Company records estimated sales returns as a reduction to sales andcost of sales, and an increase in accrued liabilities and inventories.Returned products which are recorded as inventories are valued basedupon the amount that the Company expects to realize upon theirsubsequent disposition. The physical condition and marketability of thereturned products are the major factors the Company considers inestimating realizable value. Cost of sales includes the cost ofrefurbishment of returned products. Actual returns, as well as realizedvalues on returned products, may differ significantly, either favorablyor unfavorably, from the Company’s estimates if factors such asproduct discontinuances, customer inventory levels or competitiveconditions differ from the Company’s estimates and expectationsand, in the case of actual returns, if economic conditions differsignificantly from the Company’s estimates and expectations.

Trade Support Costs:

In order to support the retail trade,the Company has various performance-based arrangements with retailersto reimburse them for all or a portion of their promotional activitiesrelated to the Company's products. The Company regularly reviewsand revises, when deemed necessary, estimates of costs to the Companyfor these promotions based on estimates of what has been incurred bythe retailers. Actual costs incurred by the Company may differsignificantly if factors such as the level and success of theretailers' programs, as well as retailer participation levels,differ from the Company's estimates and expectations.

Inventories:

Inventories are stated at the lower of cost ormarket value. Cost is principally determined by the first-in, first-outmethod. The Company records adjustments to the value of inventory basedupon its forecasted plans to sell its inventories, as well as planneddiscontinuances. The physical condition (e.g., age and quality) of theinventories is also considered in establishing its valuation. Theseadjustments are estimates, which could vary significantly, eitherfavorably or unfavorably, from the amounts that the Company mayultimately realize upon the disposition of inventories if futureeconomic conditions, customer inventory levels, productdiscontinuances, return levels or competitive conditions differ fromthe Company's estimates and expectations.

Property, Plantand Equipment and Other Assets:

Property, plant and equipmentis recorded at cost and is depreciated on a straight-line basis overthe estimated useful lives of such assets. Changes in circumstancessuch as technological advances, changes to the Company's businessmodel, changes in the planned use of fixtures or software or closing offacilities or changes in the Company's capital strategy can resultin the actual useful lives differing from the Company'sestimates.

Included in other assets are permanent wall displays,which are recorded at cost and amortized on a straight-line basis overthe estimated useful lives of such assets. Intangibles other thangoodwill are recorded at cost and amortized on a straight-line basisover the estimated useful lives of such assets.

Long-livedassets, including fixed assets, permanent wall displays and intangiblesother than goodwill, are reviewed by the Company for impairmentwhenever events or changes in circumstances indicate that 

29

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the carrying amount of any such asset may notbe recoverable. If the undiscounted cash flows (excluding interest)from the use and eventual disposition of the asset is less than thecarrying value, the Company recognizes an impairment loss, measured asthe amount by which the carrying value exceeds the fair value of theasset. The estimate of undiscounted cash flow is based upon, amongother things, certain assumptions about expected future operatingperformance. The Company's estimates of undiscounted cash flow maydiffer from actual cash flow due to, among other things, technologicalchanges, economic conditions, changes to its business model or changesin its operating performance. In those cases where the Companydetermines that the useful life of other long-lived assets should beshortened, the Company would depreciate the net book value in excess ofthe salvage value (after testing for impairment as described above),over the revised remaining useful life of such asset thereby increasingamortization expense. Additionally, goodwill is reviewed for impairmentat least annually. The Company recognizes an impairment loss to theextent that carrying value exceeds the fair value of the asset.

Pension Benefits:

The Company sponsors both funded andunfunded pension and other retirement plans in various forms coveringemployees who meet the applicable eligibility requirements. The Companyuses several statistical and other factors in an attempt to estimatefuture events in calculating the liability and expense related to theplans. These factors include assumptions about the discount rate,expected return on plan assets and rate of future compensationincreases as determined annually by the Company, within certainguidelines, which assumptions would be subject to revisions ifsignificant events occur during the year. The Company usesSeptember  30 as its measurement date for plan obligations andassets.

The Company selected a discount rate of 5.5% in2005, a decline from the 5.75% rate selected in 2004 for theCompany’s U.S. pension plans. The average discount rate selectedfor the Company’s international plans also declined from5.5% for 2004 to 5% for 2005. The discount rates are usedto measure the benefit obligations at the measurement date and the netperiodic benefit cost for the subsequent calendar year and are resetannually using data available at the measurement date. The changes inthe discount rates used for 2005 were primarily due to declininglong-term interest rates. At September  30,  2005, thedecrease in the discount rates had the effect of increasing theCompany’s projected pension benefit obligation by approximately$19 million. For fiscal 2006, the Company expects that decreasesin the discount rates will have the effect of increasing the netperiodic benefit cost for its U.S. and international plans byapproximately $1.5 million.

The expected rate of returnon the pension plan assets used in 2005 and 2004 remained unchanged at8.5% for the Company’s U.S. pension plans. The averageexpected rate of return used for the Company’s internationalplans declined from 7% in 2004 to 6.7% in 2005, primarilydue to a change in the portfolios’ asset allocations.

Thetable below reflects the Company’s estimates of the possibleeffects of changes in the discount rates and expected rates of returnon its 2006 net periodic benefit costs and its projected benefitobligation at September  30,  2005 for the Company’sprincipal plans:

|                        |  |                          |      |                                   |  |                           |         |                                    |  |        |     |        |  |        |         |        |  |  |
|------------------------|--|--------------------------|------|-----------------------------------|--|---------------------------|---------|------------------------------------|--|--------|-----|--------|--|--------|---------|--------|--|--|
|                   |  | 25basis points increase  |      | 25 basis pointsdecrease           |
|                   |  | Netperiodicbenefit costs |      | Projectedpensionbenefitobligation |  | Net periodicbenefit costs |         | Projectedpension benefitobligation |
| Discount rate          |  | $                        | (1.5 | )                            |  | $                         | (19.4   | )                             |  | $      | 1.7 |   |  | $      | 20.2    |   |
| Expected rate ofreturn |  |                     | (1.0 | )                            |  |                      | — |                               |  |   | 1.0 |   |  |   | — |   |
|                        |

The rate of future compensationincreases is another assumption used by the Company’s thirdparty actuarial consultants for pension accounting. The rate of futurecompensation increases used in 2005 and in 2004 remained unchanged at4% for the U.S. pension plans In addition, the Company'sactuarial consultants also use other factors such as withdrawal andmortality rates. The actuarial assumptions used by the Company maydiffer materially from actual results due to changing market andeconomic conditions, higher or lower withdrawal rates or longer orshorter life spans of participants, among other things. Differencesfrom these assumptions could significantly impact the actual amount ofnet periodic benefit cost and liability recorded by the Company.

30

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Results of Operations

**Yearended December  31,  2005 compared with the year endedDecember  31,  2004**

In the tables, numbers arein millions and amounts in parenthesis (    ) denote unfavorablevariances.

Net sales:

Net sales in 2005increased $35.1  million, or 2.7%, to $1,332.3million, as compared with $1,297.2  million in 2004, driven byhigher shipments and favorable foreign currency translation, partiallyoffset by higher total returns, allowances and discounts. Excluding theimpact of foreign currency fluctuations, consolidated 2005 net salesincreased 1.8%. The 2004 year benefited from the prepayment ofcertain minimum royalties and renewal fees by licensees.

|                         |  |                        |         |        |  |        |         |        |  |        |      |        |  |        |     |                             |  |  |
|-------------------------|--|------------------------|---------|--------|--|--------|---------|--------|--|--------|------|--------|--|--------|-----|-----------------------------|--|--|
|                    |  | YearEnded December 31, |         | Change |
|                    |  | 2005                   |         | 2004   |  | $      |         | %      |
| United Statesand Canada |  | $                      | 857.1   |   |  | $      | 855.7   |   |  | $      | 1.4  |   |  |   | 0.2 | %(1)                   |
| International           |  |                   | 475.2   |   |  |   | 441.5   |   |  |   | 33.7 |   |  |   | 7.6 |    (2)  |
|                    |  | $                      | 1,332.3 |   |  | $      | 1,297.2 |   |  | $      | 35.1 |   |  |   | 2.7 | %(3)                   |
|                         |

|  |
|--|
|  |  |
|  |

|     |                                                                                                |
|-----|------------------------------------------------------------------------------------------------|
| (1) | Excludingthe impact of foreign currency fluctuations, U.S. and Canada net salesdecreased 0.4%. |

|     |                                                                                              |
|-----|----------------------------------------------------------------------------------------------|
| (2) | Excludingthe impact of foreign currency fluctuations, International net salesincreased 6.0%. |

|     |                                                                                             |
|-----|---------------------------------------------------------------------------------------------|
| (3) | Excludingthe impact of foreign currency fluctuations, consolidated net salesincreased 1.8%. |

United States andCanada.

In the United States and Canada, net sales increased$1.4  million, or 0.2%, to $857.1  million in 2005from $855.7  million in 2004. Excluding the impact of Canadiancurrency fluctuations, 2005 net sales were down $3.2  million, or0.4%, compared with 2004. This decrease was primarily due to adecline in shipments of certain base business products and a decreaseof approximately $12  million in licensing revenue from 2004levels, which included the prepayments of certain minimum royalties andrenewal fees by licensees, partially offset by an increase in shipmentsof new products and the brand initiatives, net of a provision forincremental returns and allowances of approximately $44  millionassociated with the launch of the brand initiatives.

International.

Net sales in the Company'sinternational operations increased $33.7  million, or 7.6%,to $475.2  million in 2005 from $441.5  million in 2004.Excluding the impact of foreign currency fluctuations, internationalnet sales increased by $26.4  million, or 6.0%, in 2005, ascompared with 2004.

In Asia Pacific and Africa, net salesincreased by $16.4  million, or 7.3%, to $242.6million in 2005, as compared with $226.2  million in 2004.Excluding the impact of foreign currency fluctuations, net sales inAsia Pacific and Africa increased $13.5  million, or 6.0%,in 2005, as compared with 2004. This increase in 2005 net sales,excluding the impact of foreign currency fluctuations, was driven byhigher net sales in each of the Company’s major markets in theregion. Excluding the impact of foreign currency fluctuations, theCompany estimates that South Africa, Australia, Japan and certaindistributor markets contributed approximately 4.8% of theincrease in net sales for the region in 2005, as compared with2004.

In Europe, which is comprised of Europe and the MiddleEast, net sales increased by $4.4  million, or 3.6%, to$125.0  million in 2005, as compared with $120.6  million in2004. Excluding the impact of foreign currency fluctuations, net salesin Europe increased by $5.2  million, or 4.3%, in 2005, ascompared with 2004. The increase in net sales, excluding the impact offoreign currency fluctuations, was due to higher net sales in the U.K.and certain distributor markets (which the Company estimatescontributed to an approximate 5.0% increase in net sales for theregion in 2005, as compared with 2004), and was partially offset by adecrease in net sales primarily in Italy (which the Company estimatescontributed to an approximate 0.6% reduction in net sales forthe region in 2005, as compared with 2004).

31

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In Latin America, which is comprised ofMexico, Central America and South America, net sales increased by$12.9  million, or 13.6%, to $107.6  million in 2005,as compared with $94.7  million in 2004. Excluding the impact offoreign currency fluctuations, net sales in Latin America increased by$8.9  million, or 9.5%, in 2005, as compared with 2004. Theincrease in net sales, excluding the impact of foreign currencyfluctuations, was driven primarily by increased shipments in Brazil,Mexico and certain distributor markets (which the Company estimatescontributed to an approximate 9.1% increase in net sales for theregion in 2005, as compared with 2004), which was partially offset bylower net sales in Argentina and Chile (which the Company estimatescontributed to an approximate 0.5% reduction in net sales forthe region in 2005, as compared with 2004).

Grossprofit:

|              |  |                        |       |        |  |   |       |        |  |   |      |        |  |  |
|--------------|--|------------------------|-------|--------|--|---|-------|--------|--|---|------|--------|--|--|
|         |  | YearEnded December 31, |       | Change |
|         |  | 2005                   |       | 2004   |
| Gross profit |  | $                      | 824.2 |   |  | $ | 811.9 |   |  | $ | 12.3 |   |
|              |

Gross profit increased by $12.3million in 2005 from 2004 primarily due favorable foreign currencytranslation of $6.4  million and to higher shipments of products,which were partially offset by the aforementioned lower licensingrevenues, higher cost of goods due to increased shipments and higherconsolidated returns, allowances and discounts, which includedapproximately $44  million of provision for incremental returnsand allowances associated with the launch of the brand initiatives.Gross profit as a percentage of net sales decreased to 61.9% in2005 from 62.6% in 2004 primarily due to the aforementionedincrease in consolidated returns, allowances and discounts and theaforementioned lower licensing revenue.

SG&Aexpenses:

|                   |  |                        |       |        |  |   |       |        |  |   |       |         |  |  |
|-------------------|--|------------------------|-------|--------|--|---|-------|--------|--|---|-------|---------|--|--|
|              |  | YearEnded December 31, |       | Change |
|              |  | 2005                   |       | 2004   |
| SG&A expenses |  | $                      | 757.8 |   |  | $ | 717.6 |   |  | $ | (40.2 | )  |
|                   |

Excluding unfavorableforeign currency fluctuations of $5.6  million, SG&A increased$34.6  million, or 4.8%, to $757.8  million for theyear ended December  31,  2005, primarily due to $17.5million in expenditures related to the launch of the Company’stwo brand initiatives, inclusive of the aforementioned acceleratedamortization of permanent displays. The increase in SG&A expenseswas also due to $4.2  million in higher distribution costs, higherbrand support of $4.0  million and higher display amortizationexpenses related to the base business of $2.7  million, in eachcase in 2005, as compared with 2004.

Restructuringcosts:

|                                    |  |                        |     |        |  |   |     |        |  |   |     |        |  |  |
|------------------------------------|--|------------------------|-----|--------|--|---|-----|--------|--|---|-----|--------|--|--|
|                               |  | YearEnded December 31, |     | Change |
|                               |  | 2005                   |     | 2004   |
| Restructuring costs and other, net |  | $                      | 1.5 |   |  | $ | 5.8 |   |  | $ | 4.3 |   |
|                                    |

The Companyrecorded $1.5  million and $5.8  million in restructuring foremployee severance and other related personnel benefits in 2005 and2004, respectively.

Other expenses:

|                   |  |                        |       |        |  |   |       |        |  |   |     |        |  |  |
|-------------------|--|------------------------|-------|--------|--|---|-------|--------|--|---|-----|--------|--|--|
|              |  | YearEnded December 31, |       | Change |
|              |  | 2005                   |       | 2004   |
| Interest expenses |  | $                      | 130.0 |   |  | $ | 130.8 |   |  | $ | 0.8 |   |
|                   |

The decrease ininterest expense of $0.8  million for 2005, as compared with 2004,is primarily due to a slightly lower weighted average interest rateduring the first three quarters of 2005, offset in part by higher debtbalances during the fourth quarter of 2005 attributable primarily toworking capital build to help fund the Company’s brandinitiatives, as well as higher weighted average interest rates duringthe fourth quarter of 2005.

32

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|                                      |  |                       |     |        |  |   |      |        |  |   |      |        |  |  |
|--------------------------------------|--|-----------------------|-----|--------|--|---|------|--------|--|---|------|--------|--|--|
|                                 |  | YearEnded December31, |     | Change |
|                                 |  | 2005                  |     | 2004   |
| Loss on early extinguishment of debt |  | $                     | 9.0 |   |  | $ | 90.7 |   |  | $ | 81.7 |   |
|                                      |

The$9.0  million loss on early extinguishment of debt for 2005includes the $5.0  million prepayment fee related to theprepayment in March  2005 of $100.0  million of indebtednessoutstanding under the Term Loan Facility of the 2004 Credit Agreementwith a portion of the proceeds from the issuance of the Original91⁄2% Senior Notes, the aggregate $1.5million loss on the redemption of Products Corporation’s8 1/8% Senior Notes and 9% Senior Notes inApril  2005, as well as the write-off of the portion of deferredfinancing costs related to such prepaid amount. The loss on earlyextinguishment of debt for 2004 represents the loss on the exchange ofequity for certain indebtedness in the Revlon Exchange Transactions andfees, expenses and the write-off of deferred financing costs related tothe Revlon Exchange Transactions, the tender for and redemption ofProducts Corporation’s 12% Senior Secured Notes(including the applicable premium) and the repayment of ProductsCorporation’s credit agreement dated November  30,2001, which was scheduled to mature on May  30,  2005 (asamended, the ‘‘2001 Credit Agreement’’). (SeeNote 9 to the Consolidated Financial Statements).

|                    |  |                       |      |         |  |   |     |        |  |   |     |        |  |  |
|--------------------|--|-----------------------|------|---------|--|---|-----|--------|--|---|-----|--------|--|--|
|               |  | YearEnded December31, |      | Change  |
|               |  | 2005                  |      | 2004    |
| Miscellaneous, net |  | $                     | (0.5 | )  |  | $ | 2.0 |   |  | $ | 2.5 |   |
|                    |

The decrease inmiscellaneous, net for 2005, as compared with 2004, is primarily due tofees and expenses associated with the refinancing that ProductsCorporation launched in May  2004 but did not consummate.

Provision for income taxes:

|                            |  |                       |     |        |  |   |     |        |  |   |     |        |  |  |
|----------------------------|--|-----------------------|-----|--------|--|---|-----|--------|--|---|-----|--------|--|--|
|                       |  | YearEnded December31, |     | Change |
|                       |  | 2005                  |     | 2004   |
| Provision for income taxes |  | $                     | 8.5 |   |  | $ | 9.3 |   |  | $ | 0.8 |   |
|                            |

Thedecrease in the provision for income taxes in 2005, as compared with2004, was primarily attributable to the favorable resolution of varioustax matters resulting in a tax benefit of approximately $3.8 million in2005, compared to that of approximately $2.9 million in 2004. Thedecrease in the provision for income taxes was partially offset by thetax on cash repatriation dividends from a foreign subsidiary.

33

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    **Year Ended December31,  2004 compared with the year ended December  31,2003**

In the tables, numbers are in millions andamounts in parenthesis (    ) denote unfavorable variances.

Net sales:

Net sales in 2004 declined$2.1  million, or 0.2%, to $1,297.2  million, ascompared with $1,299.3  million in 2003, driven by higherconsolidated returns, allowances and discounts, due in part to higherreturns provision for product discontinuances identified in 2004 andhigher returns from promotions, partially offset by higher shipmentsand favorable foreign currency translation.

|                         |  |                        |         |        |  |        |         |        |  |        |       |         |  |        |      |                                         |  |  |
|-------------------------|--|------------------------|---------|--------|--|--------|---------|--------|--|--------|-------|---------|--|--------|------|-----------------------------------------|--|--|
|                    |  | YearEnded December 31, |         | Change |
|                    |  | 2004                   |         | 2003   |  | $      |         | %      |
| United Statesand Canada |  | $                      | 855.7   |   |  | $      | 890.6   |   |  | $      | (34.9 | )  |  |   | (3.9 | )%                                 |
| International           |  |                   | 441.5   |   |  |   | 408.7   |   |  |   | 32.8  |    |  |   | 8.0  |      (1)  |
|                    |  | $                      | 1,297.2 |   |  | $      | 1,299.3 |   |  | $      | (2.1  | )  |  |   | (0.2 | )%(2)                              |
|                         |

|  |
|--|
|  |  |
|  |

|     |                                                                                              |
|-----|----------------------------------------------------------------------------------------------|
| (1) | Excludingthe impact of foreign currency fluctuations, International net salesincreased 1.0%. |

|     |                                                                                             |
|-----|---------------------------------------------------------------------------------------------|
| (2) | Excludingthe impact of foreign currency fluctuations, consolidated net salesdecreased 2.7%. |

United States andCanada.

Net sales in the U.S. and Canada decreased $34.9million, or 4%, in 2004, as compared with 2003, due to highertotal returns, allowances and discounts of approximately $51.0million, partially offset by higher shipments of approximately$3.3  million, the favorable impact of foreign currencytranslation of $5.9  million and increased licensing revenue of$6.9  million, primarily from the prepayments of minimum royaltiesand renewal fees by licensees of $11.8  million in 2004 versus$5.3  million in 2003. The increase in returns, allowances anddiscounts in 2004 versus 2003 is due in part to higher returnsprovision for product discontinuances identified in 2004, higherreturns from promotions, and the fact that the 2003 provision forreturns benefited from a revision of previous estimates for returnsassociated with the Company's Stabilization and Growth Phase ofits plan recorded in 2002.

In terms of U.S. marketplaceperformance, the U.S. color cosmetics category for 2004 declined byapproximately 0.6% versus 2003. For 2004, the Revlon and Almaybrands combined held U.S. mass-market share of 21.4%, comparedwith 22.2% for 2003. Market share performance of existingproducts under the Revlon and Almay brands increased from 2003 to 2004,offset in part by decreased share performance of new products undersuch brands. In women’s hair color and beauty tools, the Companygained market share in 2004, compared with 2003, increasing,respectively, from a 7.3% market share for 2003 to 8.0%for 2004 and a 22.2% market share for 2003 to 24.1% for2004, while market share was down for anti-perspirants/deodorants,decreasing from 6.4% in 2003 to 6.2% in 2004.

International.

Net sales in the Company'sinternational operations increased $32.8  million, or 8.0%,in 2004, as compared with 2003. Excluding the impact of foreigncurrency fluctuations, international net sales increased by 1.0%in 2004, as compared with 2003.

In Europe, which is comprised ofEurope and the Middle East, net sales decreased by $3.7  million,or 3.0%, to $120.6  million for 2004, as compared with2003. Excluding the impact of foreign currency fluctuations, net salesdecreased by $15.1  million, or 12.2%, in 2004, as comparedwith 2003. The decline in net sales, excluding the impact of foreigncurrency fluctuations, was due to lower sales in the U.K., in part dueto reduced customer inventory levels and higher allowances granted tocustomers (which the Company estimates contributed to an approximate9.4% reduction in net sales in 2004 for the region, as comparedwith 2003) and lower sales to distributors in Russia and Germany (whichthe Company estimates contributed to an approximate 4.3%reduction in net sales in 2004 for the region, as compared with 2003),partially offset by increased sales in Israel (which the Companyestimates contributed to an approximate 1.3% increase in netsales in 2004 for the region, as compared with 2003).

34

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In September  2004, the Companyexercised its contractual rights to terminate its 2002 supply agreementwith COSi that became effective on January  31,  2006. TheCompany has transitioned such manufacturing primarily to its Oxford,North Carolina facility and distribution and warehousing to a localU.K.-based third party. During 2004, COSi earned approximately$1.9  million in performance-based payments. In December2004, the Company and COSi entered into a transitional agreementcovering the period through termination pursuant to which, among otherthings, COSi received $1.9  million in additionalperformance-based payments by maintaining specific production servicelevel objectives. However, such payments were fully set off againstpayments due to the Company from COSi in connection with the cessationof such arrangement.

In Latin America, which is comprised ofMexico, Central America and South America, net sales increased by$2.5  million, or 2.8%, to $94.7  million for 2004, ascompared with 2003. Excluding the impact of foreign currencyfluctuations, net sales increased by $4.8  million, or5.2%, in 2004, as compared with 2003. The increase in net sales,excluding the impact of foreign currency fluctuations, was primarilydue to increased net sales in Brazil, Venezuela and certain distributormarkets due to improved local economic and business conditions (whichthe Company estimates contributed to an approximate 11.5%increase in net sales for the region in 2004, as compared with 2003),partially offset by lower sales in Mexico (which the Company estimatescontributed to an approximate 5.2% reduction in net sales in2004 for the region, as compared with 2003).

In the Asia Pacificand Africa, net sales increased by $34.0  million, or17.7%, to $226.2  million for 2004, as compared with 2003.Excluding the impact of foreign currency fluctuations, net salesincreased $14.4  million, or 7.5%, for 2004, as comparedwith 2003. This increase was driven by higher sales in South Africa andJapan related to favorable economic conditions (which the Companyestimates contributed to an approximate 6.0% increase in netsales in 2004 for the region, as compared with 2003).

Grossprofit:

|              |  |                       |       |        |  |   |       |        |  |   |      |        |  |  |
|--------------|--|-----------------------|-------|--------|--|---|-------|--------|--|---|------|--------|--|--|
|         |  | YearEnded December31, |       | Change |
|         |  | 2004                  |       | 2003   |
| Gross profit |  | $                     | 811.9 |   |  | $ | 798.2 |   |  | $ | 13.7 |   |
|              |

Excluding foreignexchange fluctuations, gross profit for 2004 decreased $6.3million, as compared with 2003, reflecting higher total returns,allowances and discounts, partially offset by higher shipments ofproducts, the aforementioned increase in licensing revenue and lowercost of goods sold. Gross profit as a percent of sales, excluding theimpact of foreign currency fluctuations, increased to 62.6% in2004 from 61.4% in 2003, primarily due to cost savings and theaforementioned higher licensing revenues, partially offset by highertotal returns, allowances and discounts.

SG&Aexpenses:

|                   |  |                       |       |        |  |   |       |        |  |   |      |        |  |  |
|-------------------|--|-----------------------|-------|--------|--|---|-------|--------|--|---|------|--------|--|--|
|              |  | YearEnded December31, |       | Change |
|              |  | 2004                  |       | 2003   |
| SG&A expenses |  | $                     | 717.6 |   |  | $ | 770.9 |   |  | $ | 53.3 |   |
|                   |

SG&A expensesdecreased $53.3  million, or 6.9%, to $717.6  millionfor 2004, as compared with 2003, due primarily to $36.7  millionof lower marketing spending and the absence of fees and expensesrelated to the Stabilization and Growth Phase of the Company'splan in 2004 versus $26.1  million of plan-related expenses in2003, partially offset by $14.9  million of unfavorable foreigncurrency fluctuations.

Restructuring costs:

|                                    |  |                       |     |        |  |   |     |        |  |   |     |        |  |  |
|------------------------------------|--|-----------------------|-----|--------|--|---|-----|--------|--|---|-----|--------|--|--|
|                               |  | YearEnded December31, |     | Change |
|                               |  | 2004                  |     | 2003   |
| Restructuring costs and other, net |  | $                     | 5.8 |   |  | $ | 6.0 |   |  | $ | 0.2 |   |
|                                    |

The Companyrecorded $5.8  million and $6.0  million for employeeseverance and other personnel benefits in 2004 and 2003,respectively.

35

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Other expenses:

|                   |  |                       |       |        |  |   |       |        |  |   |      |        |  |  |
|-------------------|--|-----------------------|-------|--------|--|---|-------|--------|--|---|------|--------|--|--|
|              |  | YearEnded December31, |       | Change |
|              |  | 2004                  |       | 2003   |
| Interest expenses |  | $                     | 130.8 |   |  | $ | 174.5 |   |  | $ | 43.7 |   |
|                   |

The decrease in interestexpense of $43.7  million for 2004, as compared with 2003, isprimarily due to lower consolidated debt during 2004, resulting fromthe Revlon Exchange Transactions, partially offset by higher borrowingsunder the 2004 Credit Agreement to repay the 2001 Credit Agreement, thetender for and redemption of the 12% Senior Secured Notes(including the applicable premium and accrued interest) and to payrelated fees and expenses. (See Note 9 to the Consolidated FinancialStatements).

|                                      |  |                       |      |        |  |   |                     |        |  |   |       |         |  |  |
|--------------------------------------|--|-----------------------|------|--------|--|---|---------------------|--------|--|---|-------|---------|--|--|
|                                 |  | YearEnded December31, |      | Change |
|                                 |  | 2004                  |      | 2003   |
| Loss on early extinguishment of debt |  | $                     | 90.7 |   |  | $ |   — |   |  | $ | (90.7 | )  |
|                                      |

The loss on early extinguishment ofdebt in 2004 represents the loss on the exchange of equity for certainindebtedness in the Revlon Exchange Transactions (such loss was equalto the difference between the fair value of the equity securitiesissued in the Revlon Exchange Transactions and the book value of therelated indebtedness exchanged by third parties other than MacAndrews& Forbes or related parties) and fees, expenses and the write-offof deferred financing costs related to the Revlon ExchangeTransactions, the tender for and redemption of the 12% SeniorSecured Notes (including the applicable premium) and the repayment ofthe 2001 Credit Agreement. (See Note 9 to the Consolidated FinancialStatements).

|                    |  |                       |     |        |  |   |     |        |  |   |      |         |  |  |
|--------------------|--|-----------------------|-----|--------|--|---|-----|--------|--|---|------|---------|--|--|
|               |  | YearEnded December31, |     | Change |
|               |  | 2004                  |     | 2003   |
| Miscellaneous, net |  | $                     | 2.0 |   |  | $ | 0.5 |   |  | $ | (1.5 | )  |
|                    |

The increase inmiscellaneous, net for 2004, as compared with 2003, is primarily due tofees and expenses associated with the refinancing that ProductsCorporation launched in May  2004, but did not consummate.

Provision for income taxes:

|                            |  |                       |     |        |  |   |     |        |  |   |      |         |  |  |
|----------------------------|--|-----------------------|-----|--------|--|---|-----|--------|--|---|------|---------|--|--|
|                       |  | YearEnded December31, |     | Change |
|                       |  | 2004                  |     | 2003   |
| Provision for income taxes |  | $                     | 9.3 |   |  | $ | 0.5 |   |  | $ | (8.8 | )  |
|                            |

Theincrease in the provision for income taxes in 2004, as compared with2003, is due to higher taxable income in certain markets outside theU.S. in 2004. Additionally, 2004 and 2003 benefited by approximately$2.9  million and $7.0  million, respectively, from thefavorable resolution of various tax audits.

FinancialCondition, Liquidity and Capital Resources

Net cash used foroperating activities was $139.7  million, $94.2  million and$166.4  million for 2005, 2004 and 2003, respectively. Thisincrease in cash used in 2005 versus 2004 resulted primarily fromincreased purchases of permanent displays and an increase in inventoryand accounts receivables, partially offset by an increase in accountspayable and accrued expenses, in each case due principally to the brandinitiatives. The improvement in net cash used for operating activitiesfor 2004 versus 2003 resulted primarily from higher operating income,lower purchases of permanent displays, lower accrued expenses and lowercash spending in connection with the Stabilization and Growth Phase ofthe Company's plan and lower interest payments. The Companyreceived nil, $11.8  million and $5.3  million in 2005, 2004and 2003, respectively, related to prepaid minimum royalties andrenewal fees under licensing agreements.

Net cash used forinvesting activities was $15.8  million, $18.9  million and$23.3  million for 2005, 2004 and 2003, respectively. Net cashused for investing activities for 2005, 2004 and 2003 primarilyconsisted of capital expenditures, partially offset in 2003 by theproceeds from the sale of the Company's warehouse in Canada.

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Net cash provided by financing activitieswas $67.6  million, $174.5  million and $151.1  millionfor 2005, 2004 and 2003, respectively. Net cash provided by financingactivities for 2005 included proceeds of $386.2  million from theissuance of the 91⁄2% Senior Notes, which wasused to (i) prepay $100.0  million of indebtedness under the TermLoan Facility of Products Corporation’s 2004 Credit Agreement,along with the $5.0  million prepayment fee plus accrued interest,(ii) redeem $116.2  million aggregate principal amount outstandingof Products Corporation’s 8 1/8% SeniorNotes, plus the payment of accrued interest, (iii) redeem $75.5million aggregate principal amount outstanding of ProductsCorporation’s 9% Senior Notes, plus accrued interest andthe applicable premium, and (iv) pay financing costs related to suchtransactions, with the balance being used to help fund theCompany’s brand initiatives. Net cash provided by financingactivities for 2004 included cash drawn under each of the 2001 CreditAgreement, a $125  million term loan from MacAndrews & Forbes(the ‘‘2004 $125  million MacAndrews & ForbesLoan’’) and the Term Loan Facility under the 2004 CreditAgreement, partially offset by a) the repayment of borrowings under the2001 Credit Agreement (in connection with the refinancing thereof), b)the repayment of borrowings under the 2004 $125  millionMacAndrews & Forbes Loan, c) the payment of the redemption price,the applicable premium and interest in connection with the tender forand redemption of Products Corporation’s 12% SeniorSecured Notes and d) the payment of financing costs in connection withcertain amendments to the 2001 Credit Agreement during 2004, the RevlonExchange Transactions, the 2004 Credit Agreement and the tender for andredemption of the 12% Senior Secured Notes. Net cash provided byfinancing activities for 2003 included cash drawn under the 2001 CreditAgreement and under a $65  million line of credit and a$100.0  million term loan from MacAndrews & Forbes and netproceeds from a $50.0  million rights offering conducted byRevlon, Inc. in 2003, partially offset by the repayment of borrowingsunder the 2001 Credit Agreement and payment of financing costs.

At February  1,  2006, Products Corporation had aliquidity position, of approximately $255  million, consisting of(i) cash, cash equivalents and marketable securities (net of anyoutstanding checks), (ii) approximately $144  million of availableborrowings from the Multi-Currency Facility under the 2004 CreditAgreement and (iii) approximately $87  million of availableborrowings under the 2004 Consolidated MacAndrews & Forbes Line ofCredit. (See ‘‘Recent Developments’’).

2004 Credit Agreement

In July  2004, ProductsCorporation entered into a new credit agreement (the ‘‘2004Credit Agreement’’) with certain of its subsidiaries aslocal borrowing subsidiaries, a syndicate of lenders, and Citicorp USA,Inc., as multi-currency administrative agent, term loan administrativeagent and collateral agent.

The 2004 Credit Agreement originallyprovided up to $960.0  million and, before giving effect to the$100.0  million prepayment in March  2005, consisted of aterm loan facility of $800.0  million (prior to being reduced to$700.0  million following the Company’s March  2005prepayment of $100.0  million) (the ‘‘Term LoanFacility’’) and a $160.0  million multi-currencyfacility, the availability under which varies based upon the borrowingbase that is determined based upon the value of eligible accountsreceivable, eligible inventory and eligible real property and equipmentin the U.S. and the U.K. from time to time (the‘‘Multi-Currency Facility’’). ProductsCorporation may request the Multi-Currency Facility to be increasedfrom time to time in an aggregate principal amount not to exceed$50.0  million subject to certain exceptions and subject to thelenders’ agreement. The Multi-Currency Facility is available to:(i) Products Corporation in revolving credit loans denominated in U.S.dollars, (ii) Products Corporation in swing line loans denominated inU.S. dollars up to $25.0  million, (iii) Products Corporation instandby and commercial letters of credit denominated in U.S. dollarsand other currencies up to $50.0  million and (iv) ProductsCorporation and certain of its international subsidiaries designatedfrom time to time in revolving credit loans and bankers’acceptances denominated in U.S. dollars and other currencies, in eachcase subject to borrowing base availability. If the value of theeligible assets is not sufficient to support the $160.0  millionborrowing base under the Multi-Currency Facility, Products Corporationwill not have full access to the Multi-Currency Facility. ProductsCorporation’s ability to make borrowings under theMulti-Currency Facility is also conditioned upon the satisfaction ofcertain conditions precedent and Products Corporation’scompliance with other covenants in the 2004 Credit Agreement, includinga fixed charge coverage ratio that applies when the excess borrowingbase is less than $30.0  million. In 

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March  2005 Products Corporationprepaid $100.0  million of indebtedness outstanding under the TermLoan Facility, together with accrued interest and the $5.0million prepayment fee associated with such prepayment, using a portionof the proceeds from the issuance of the Original 200591⁄2% Senior Notes.

The Multi-CurrencyFacility will terminate on July  9,  2009 and the loans underthe Term Loan Facility will mature on July  9,  2010;provided that the 2004 Credit Agreement will terminate on October30,  2007 if the 8 5/8% Senior SubordinatedNotes are not redeemed, repurchased, defeased or repaid on or beforesuch date such that not more than $25.0  million in aggregateprincipal amount of Products Corporation’s8 5/8% Senior Subordinated Notes remainoutstanding. In addition to customary events of default, it would be anevent of default under the 2004 Credit Agreement if Revlon, Inc. failsto complete an approximately $110.0  million equity issuance andtransfer the proceeds of such equity issuance to Products Corporationby March  31,  2006, which Products Corporation must promptlyuse to reduce its outstanding indebtedness. (See ‘‘RecentDevelopments’’).

Borrowings under the Multi-CurrencyFacility (other than loans in foreign currencies) bear interest at arate equal to, at Products Corporation's option, either (A) theAlternate Base Rate plus 1.50%; or (B) the Eurodollar Rate plus2.50%. Loans in foreign currencies bear interest in certainlimited circumstances or if mutually acceptable to Products Corporationand the relevant foreign lenders at the Local Rate, and otherwise atthe Eurocurrency Rate, in each case plus 2.50%. The loans underthe Term Loan Facility bear interest at a rate equal to, at ProductsCorporation's option, either (A) the Alternate Base Rate plus5.00%; or (B) the Eurodollar Rate plus 6.00%. AtDecember  31,  2005, the weighted average rate for borrowingsunder the Term Loan Facility was 10.1%.

The 2004 CreditAgreement requires Products Corporation to comply with variousfinancial covenants and restrictions, including covenants andrestrictions relating to indebtedness, liens, investments, sales ofassets, mergers and acquisitions, dividends and transactions withProducts Corporation’s affiliates, each of which is subject tolimited exceptions. Additionally, the 2004 Credit Agreement containsfinancial covenants limiting Products Corporation’s seniorsecured leverage ratio (the ratio of Products Corporation’sSenior Secured Debt to EBITDA, as each such term is defined in the 2004Credit Agreement) to 5.50 to 1.00 for the four consecutive quartersending during the period from December  31,  2004 toSeptember  30,  2005; 5.00 to 1.00 for the four consecutivequarters ending during the period from December  31,  2005 toDecember  31,  2006; and 4.50 to 1.00 for the fourconsecutive quarters ending March  31,  2007 and eachsubsequent quarter until the maturity date of the 2004 CreditAgreement. Additionally, under any circumstances when the excessborrowing base under the Multi-Currency Facility is less than$30.0  million for a period of 30 consecutive days or more,Products Corporation would be required to maintain a consolidated fixedcharge coverage ratio (the ratio of EBITDA minus Capital Expendituresto Cash Interest Expense for such period, as each such term is definedin the 2004 Credit Agreement) of 1.00 to 1.00. Products Corporation wasin compliance with all applicable covenants under the 2004 CreditAgreement as of December  31,  2005.

At February1,  2006, the Term Loan Facility was fully drawn and availabilityunder the Multi-Currency Facility, based upon the calculated borrowingbase less approximately $16 million of outstanding letters of credit,was approximately $144  million, as the Multi-Currency Facilitywas undrawn. (See ‘‘Recent Developments’’regarding recent amendments to the financial covenants under the 2004Credit Agreement).

2004 Consolidated MacAndrews &Forbes Line of Credit

In July  2004, ProductsCorporation and MacAndrews & Forbes Inc. entered into a line ofcredit, with an initial commitment of $152.0  million, whichreduced to $87.0  million in July  2005 (as amended, the‘‘2004 Consolidated MacAndrews & Forbes Line ofCredit’’). (See ‘‘RecentDevelopments’’ regarding an extension of the term of suchline of credit). As of February  1,  2006, the 2004Consolidated MacAndrews & Forbes Line of Credit was undrawn.

Loans are available under the 2004 Consolidated MacAndrews &Forbes Line of Credit if (i) the Multi-Currency Facility under the 2004Credit Agreement has been substantially drawn (after taking intoaccount anticipated needs for Local Loans (as defined in the 2004Credit Agreement) and letters of credit), (ii) such borrowing isnecessary to cause the excess borrowing base under the Multi-Currency

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Facility to remain greater than $30.0million, (iii) additional revolving loans are not available under theMulti-Currency Facility, (iv) such borrowing is reasonably necessary toprevent or to cure a default or event of default under the 2004 CreditAgreement or (v) Products Corporation requests such loan to assist itin funding investments in the Company’s brand initiatives.

Loans under the 2004 Consolidated MacAndrews & Forbes Line ofCredit bear interest (which is not payable in cash but is capitalizedquarterly in arrears) at a rate per annum equal to the lesser of (a)12.0% and (b) 0.25% less than the rate payable from timeto time on Eurodollar loans under the Term Loan Facility under the 2004Credit Agreement, which effective interest rate was 9.35% as ofDecember  31,  2005, provided that at any time that theEurodollar Base Rate under the 2004 Credit Agreement is equal to orgreater than 3.0%, the applicable rate on loans under the 2004Consolidated MacAndrews & Forbes Line of Credit will be equal tothe lesser of (x) 12.0% and (y) 5.25% over the EurodollarBase Rate then in effect.

2005 RefinancingTransactions

In March  2005, Products Corporationissued $310.0  million aggregate principal amount of its Original91⁄2% Senior Notes. This issuance and therelated transactions extended the maturities of ProductsCorporation's debt that would have otherwise been due in 2006.

The proceeds from the Original 91⁄2% SeniorNotes were used to prepay $100.0  million of indebtednessoutstanding under the Term Loan Facility of ProductsCorporation’s 2004 Credit Agreement, together with accruedinterest and the associated $5.0  million prepayment fee, and topay $7.0  million in certain fees and expenses associated with theissuance of the Original 91⁄2% Senior Notes. Theremaining $197.9  million in proceeds was used to redeem all ofthe $116.2  million aggregate principal amount outstanding ofProducts Corporation’s 8 1/8% SeniorNotes, plus accrued interest, and all of the $75.5  millionaggregate principal amount outstanding of Products Corporation’s9% Senior Notes, plus accrued interest and applicable premium.The aggregate redemption amounts for the 8 1/8%Senior Notes and 9% Senior Notes were $118.1  million and$79.8  million, respectively, which constituted the principalamount and interest payable on the 8 1/8% SeniorNotes and the 9% Senior Notes up to, but not including, theredemption date, and, with respect to the 9% Senior Notes, theapplicable premium. In June  2005, all of the Original91⁄2% Senior Notes which were issued by ProductsCorporation in March  2005 were exchanged for the March2005  91⁄2% Senior Notes, which havesubstantially identical terms to the Original91⁄2% Senior Notes, except that the March2005  91⁄2% Senior Notes are registeredwith the SEC under the Securities Act, and the transfer restrictionsand registration rights applicable to the Original91⁄2% Senior Notes do not apply to theMarch  2005  91⁄2% Senior Notes.

In August  2005, Products Corporation issued $80.0million aggregate principal amount of the Additional91⁄2% Senior Notes, which priced at951⁄4% of par. Products Corporation issued theAdditional 91⁄2% Senior Notes as additionalnotes pursuant to the same indenture, dated as of March  16,2005, governing the March  2005  91⁄2%Senior Notes (the ‘‘91⁄2% SeniorNotes Indenture’’). The Additional91⁄2% Senior Notes constitute a further issuanceof, are the same series as, and will vote on any matters submitted tonote holders with, the March  200591⁄2% Senior Notes. In December  2005, allof the Additional 91⁄2% Senior Notes issued byProducts Corporation were exchanged for new August91⁄2% Senior Notes, which have substantiallyidentical terms to the Additional 91⁄2% SeniorNotes, except that the August  200591⁄2% Senior Notes are registered with the SECunder the Securities Act, and the transfer restrictions andregistration rights applicable to the Additional91⁄2% Senior Notes do not apply to theAugust  2005  91⁄2% Senior Notes.

Pursuant to the terms of the 91⁄2% SeniorNotes Indenture, the 91⁄2% Senior Notes aresenior unsecured debt of Products Corporation with right to paymentunder the 91⁄2% Senior Notes equal in right ofpayment with any present and future senior indebtedness of ProductsCorporation. The 91⁄2% Senior Notes bearinterest at an annual rate of 91⁄2%, which ispayable on April  1 and October  1 of each year, whichcommenced on October  1,  2005.

As mentioned in‘‘Overview – Overview of FinancingActivities’’, in August  2005, Revlon, Inc. announcedits plan to issue $185.0  million of equity, with the proceedsfrom approximately $110  million of this issuance to becontributed to Products Corporation to reduce its debt and the balanceof the 

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proceeds to be available to ProductsCorporation for general corporate purposes. Additionally, in connectionwith Revlon, Inc.’s plan to issue $185.0  million ofequity, MacAndrews & Forbes and Revlon, Inc. amended the 2004Investment Agreement to increase MacAndrews & Forbes'commitment to purchase such equity as is necessary to ensure thatRevlon, Inc. issues $185.0  million in equity. (See‘‘Recent Developments’’).

2004Refinancing Transactions

In February  2004, Revlon,Inc.'s Board of Directors approved agreements with FidelityManagement & Research Company(‘‘Fidelity’’) and MacAndrews & Forbesintended to dramatically strengthen the Company's balance sheet,as well as an Investment Agreement (the ‘‘2004 InvestmentAgreement’’) with MacAndrews & Forbes covering a seriesof transactions designed to reduce Products Corporation's levelsof indebtedness.

In March  2004, Revlon, Inc. exchangedapproximately $804  million of Products Corporation’s debt,$54.6  million of Revlon, Inc. preferred stock and $9.9million of accrued interest for 299,969,493 shares of Class A CommonStock (the ‘‘Revlon Exchange Transactions’’).As a result of the Revlon Exchange Transactions, Revlon, Inc. reducedProducts Corporation's debt by approximately $804  million onMarch  25,  2004. In addition to the Revlon ExchangeTransactions, pursuant to the 2004 Investment Agreement, Revlon, Inc.is committed to conduct further rights and equity offerings (suchequity offerings, together with the Revlon Exchange Transactions, arereferred to as the ‘‘Debt ReductionTransactions’’). Under the 2004 Credit Agreement,MacAndrews & Forbes agreed to take, or cause to be taken, allcommercially reasonable actions to facilitate the Debt ReductionTransactions. (See ‘‘Recent Developments’’ and‘‘— Overview — Overview of FinancingActivities’’ for further discussion of such proposed equityissuances).

In another contemporaneous transaction to the RevlonExchange Transactions, Revlon, Inc. and Fidelity entered into astockholders agreement (the ‘‘StockholdersAgreement’’) pursuant to which, among other things, (i)Revlon, Inc. agreed to continue to maintain a majority of independentdirectors (as defined by NYSE listing standards) on its Board ofDirectors, as it currently does (as of February  1,  2006,eight of Revlon, Inc.’s twelve directors are independent); (ii)Revlon, Inc. would establish and maintain a Nominating and CorporateGovernance Committee of the Board of Directors, which it formed inMarch  2004; and (iii) Revlon, Inc. agreed to certain restrictionswith respect to Revlon, Inc.'s conducting any business or enteringinto any transactions or series of related transactions with any of itsaffiliates, any holders of 10% or more of the outstanding votingstock or any affiliates of such holders (in each case, other than itssubsidiaries). The Stockholders Agreement will terminate at such timeas Fidelity ceases to be the beneficial holder of at least 5% ofRevlon, Inc.'s outstanding voting stock.

Sources andUses

The Company's principal sources of funds areexpected to be operating revenues, cash on hand, net cash proceeds fromthe planned $75  million equity issuance described in‘‘Recent Developments’’, and funds availablefor borrowing under the 2004 Credit Agreement, the 2004 ConsolidatedMacAndrews & Forbes Line of Credit and other permitted lines ofcredit. (See ‘‘Recent Developments’’ regardingthe extension of the term of the 2004 Consolidated MacAndrews &Forbes Line of Credit ). The 2004 Credit Agreement, the 2004Consolidated MacAndrews & Forbes Line of Credit and the indenturesgoverning the 91⁄2% Senior Notes and the8 5/8% Senior Subordinated Notes contain certainprovisions that by their terms limit Products Corporation and itssubsidiaries' ability to, among other things, incur additionaldebt.

The Company's principal uses of funds are expected tobe the payment of operating expenses, including expenses in connectionwith the continued implementation of, and refinement to, theCompany’s plan (including the Company’s brand initiativesreferred to in ‘‘— Overview — Overviewof Brand Initiatives’’), purchases of permanent walldisplays, capital expenditure requirements, payments in connection withthe Company’s restructuring programs referred to herein andunder ‘‘Recent Developments’’, debt servicepayments and costs and regularly scheduled pension and post-retirementbenefit plan contributions. Cash contributions to the Company'spension and post-retirement benefit plans were approximately $27million in 2005 and the Company expects them to be approximately

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$33  million in 2006. In 2005, theCompany’s purchases of wall displays were approximately$70  million and capital expenditures were approximately $26million.

The Company continues to make certain investments inconnection with its brand initiatives, most notably in the area ofpermanent displays and inventory. In terms of the cash flow impact ofthese brand initiatives, the Company expects that its investment inpermanent displays, including displays for its existing businesses andthese brand initiatives, will be in the range of $85  million to$95  million for 2006, returning to more normalized levelsthereafter. The Company’s working capital increasedsignificantly during the second half of 2005, due principally to thebrand initiatives, and is expected to return to more normalized levelsin relation to sales during the second half of 2006. The Companyestimates that capital expenditures for 2006 will be approximately$35  million.

The Company has undertaken a number ofprograms to efficiently manage its cash and working capital including,among other things, programs to carefully manage inventory levels,centralized purchasing to secure discounts and efficiencies inprocurement, and providing additional discounts to U.S. customers formore timely payment of receivables and careful management of accountspayable.

In 2002, the Company estimated that charges related tothe implementation of the Stabilization and Growth Phase of its planwould not exceed $160  million. The Company recorded charges ofapproximately $104  million in 2002, $31  million in 2003 andnil after 2003 related to the implementation of the Stabilization andGrowth Phase of its plan. Cash payments related to the foregoingcharges were approximately nil, $20  million and $80  millionduring 2005, 2004 and 2003, respectively.

Continuing toimplement and refine the Company’s plan could include takingadvantage of additional opportunities to reposition, repackage orreformulate one or more brands or product lines, launching additionalnew brands or products and/or further refining the Company’sapproach to retail merchandising. Any of these actions, whose intendedpurpose would be to create value through profitable growth, couldresult in the Company making investments or recognizing charges relatedto executing against such opportunities.

The Company expectsthat operating revenues, cash on hand, net cash proceeds from theplanned $75  million equity issuance described in‘‘Recent Developments’’ and funds available forborrowing under the 2004 Credit Agreement, the 2004 ConsolidatedMacAndrews & Forbes Line of Credit and other permitted lines ofcredit will be sufficient to enable the Company to cover its operatingexpenses for 2006, including cash requirements in connection with theCompany’s operations, the continued implementation of, andrefinement to, the Company’s plan (including theCompany’s brand initiatives referred to in‘‘— Overview — Overview of BrandInitiatives’’), cash requirements in connection with theCompany’s restructuring programs referred to above, theCompany’s debt service requirements and regularly scheduledpension and post-retirement plan contributions. However, there can beno assurance that such funds will be sufficient to meet theCompany’s cash requirements on a consolidated basis. If theCompany’s anticipated level of revenue growth is not achievedbecause, for example, of decreased consumer spending in response toweak economic conditions or weakness in the mass-market cosmeticscategory, adverse changes in currency, increased competition from theCompany’s competitors, changes in consumer purchasing habits,including with respect to shopping channels, retailer inventorymanagement or the Company’s advertising and marketing plans orbrand initiatives are not as successful as anticipated, or if theCompany’s expenses associated with the continued implementationof, and refinement to, the Company’s plan exceed the anticipatedlevel of expenses, the Company’s current sources of funds may beinsufficient to meet the Company’s cash requirements.

Although the U.S. mass-market for color cosmetics advanced3.2% for the year ended December  31,  2005, ascompared with 2004, the U.S. mass-market color cosmetics categorydeclined by approximately 0.6% in 2004 from 2003 and declined byapproximately 1.1% in 2003 from 2002. In the event of a decreasein demand for the Company's products, reduced sales, lack ofincreases in demand and sales, changes in consumer purchasing habits,including with respect to shopping channels, retailer inventorymanagement and/or increased returns or expenses associated with thecontinued implementation of, and refinement to, the Company's planexceeding its expectations, any such development, if 

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significant, could reduce ProductsCorporation's revenues and could adversely affect ProductsCorporation's ability to comply with certain financial covenantsunder the 2004 Credit Agreement and in such event the Company could berequired to take measures, including reducing discretionaryspending.

(See Item 1A, ‘‘Risk Factors — TheCompany’s ability to service its debt and meet its cashrequirements depends on many factors, including achieving anticipatedlevels of revenue growth and expenses. If such levels prove to be otherthan as anticipated, the Company may be unable to meet its cashrequirements or Products Corporation may be unable to meet therequirements of the financial covenants under the 2004 CreditAgreement, which could have a material adverse effect on theCompany’s business’’; ‘‘— TheCompany may be unable to increase its sales through theCompany’s primary distribution channels’’; and‘‘— Restrictions and covenants in ProductsCorporation’s debt agreements limit its ability to take certainactions and impose consequences in the event of failure tocomply’’).

As noted in ‘‘— 2005Refinancing Transactions’’, in April  2005, using theproceeds from the issuance of the Original 91⁄2%Senior Notes in March  2005, Products Corporation prepaid$100.0  million of principal amount outstanding under the TermLoan Facility of the 2004 Credit Agreement and redeemed all ofProducts Corporation’s 8 1/8% Senior Notesand 9% Senior Notes in April 2005. Products Corporationlikewise plans to refinance its 8 5/8% SeniorSubordinated Notes, with an aggregate principal amount outstanding of$327.0  million, prior to their maturity in 2008. Under the 2004Credit Agreement, Products Corporation must refinance its8 5/8% Senior Subordinated Notes by October30,  2007 (such that not more than $25.0  million aggregateprincipal amount of such notes remains outstanding). In addition, itwould be an event of default under the 2004 Credit Agreement if Revlon,Inc. failed to issue approximately $110.0  million of equity andtransfer the proceeds of such equity issuance to Products Corporationby March  31,  2006 to promptly reduce its outstandingindebtedness. (See ‘‘Recent Developments’’ and‘‘— Overview — Overview of FinancingActivities’’ regarding the Company’s planned equityissuances). As of February  1,  2006, the Company had$700.0  million of outstanding indebtedness under the Term LoanFacility of the 2004 Credit Agreement and availability of approximately$144  million under the Multi-Currency Facility, based upon thecalculated borrowing base less approximately $16 million of outstandingletters of credit, while the 2004 Consolidated MacAndrews & ForbesLine of Credit, with availability of $87  million, was undrawn. Inaddition, in August  2005, Products Corporation issued $80.0million aggregate principal amount of the Additional91⁄2% Senior Notes. (See ‘‘2005Refinancing Transactions’’).

Revlon, Inc., as aholding company, will be dependent on the earnings and cash flow of,and dividends and distributions from, Products Corporation to pay itsexpenses and to pay any cash dividend or distribution on Revlon,Inc.'s Class A Common Stock that may be authorized by the Board ofDirectors of Revlon, Inc. The terms of the 2004 Credit Agreement, the2004 Consolidated MacAndrews & Forbes Line of Credit and theindentures governing the 91⁄2% Senior Notes andthe 8 5/8% Senior Subordinated Notes generallyrestrict Products Corporation from paying dividends or makingdistributions, except that Products Corporation is permitted to paydividends and make distributions to Revlon, Inc. to enable Revlon,Inc., among other things, to pay expenses incidental to being a publicholding company, including, among other things, professional fees suchas legal and accounting fees, regulatory fees such as SEC filing feesand other miscellaneous expenses related to being a public holdingcompany and, subject to certain limitations, to pay dividends or makedistributions in certain circumstances to finance the purchase byRevlon, Inc. of its Class A Common Stock in connection with thedelivery of such Class A Common Stock to grantees under the Amended andRestated Revlon, Inc. Stock Plan (the ‘‘StockPlan’’).

As a result of the closing of the RevlonExchange Transactions, as of the end of March  25,  2004,Revlon, Inc., Products Corporation and their U.S. subsidiaries were nolonger included in the MacAndrews & Forbes Holdings consolidatedgroup (the ‘‘MacAndrews & Forbes Group’’)for federal income tax purposes. The MacAndrews & Forbes TaxSharing Agreement (as hereinafter defined) will remain in effect solelyfor taxable periods beginning on or after January  1,  1992,through and including March  25,  2004. In these taxableperiods, Revlon, Inc. and Products Corporation were included in theMacAndrews & Forbes Group, and Revlon, Inc.'s and ProductsCorporation's federal taxable income and loss were included insuch group's consolidated tax return filed by MacAndrews &Forbes Holdings. Revlon, Inc. and Products Corporation were alsoincluded in certain state and local tax returns of MacAndrews &Forbes Holdings or its subsidiaries. In June  1992, RevlonHoldings (as hereinafter 

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defined), Revlon, Inc., Products Corporationand certain of its subsidiaries, and MacAndrews & Forbes Holdingsentered into a tax sharing agreement (as subsequently amended andrestated, the ‘‘MacAndrews & Forbes Tax SharingAgreement’’), pursuant to which MacAndrews & ForbesHoldings agreed to indemnify Revlon, Inc. and Products Corporationagainst federal, state or local income tax liabilities of theMacAndrews & Forbes Group (other than in respect of Revlon, Inc.and Products Corporation) for taxable periods beginning on or afterJanuary  1,  1992 during which Revlon, Inc. and ProductsCorporation or a subsidiary of Products Corporation was a member ofsuch group. Pursuant to the MacAndrews & Forbes Tax SharingAgreement, for all such taxable periods, Products Corporation wasrequired to pay to Revlon, Inc., which in turn was required to pay toRevlon Holdings, amounts equal to the taxes that Products Corporationwould otherwise have had to pay if it were to file separate federal,state or local income tax returns (including any amounts determined tobe due as a result of a redetermination arising from an audit orotherwise of the consolidated or combined tax liability relating to anysuch period which was attributable to Products Corporation), exceptthat Products Corporation was not entitled to carry back any losses totaxable periods ending prior to January  1,  1992. Nopayments were required by Products Corporation or Revlon, Inc. if andto the extent Products Corporation was prohibited under the terms ofits 2004 Credit Agreement from making tax sharing payments to Revlon,Inc. The 2004 Credit Agreement prohibits Products Corporation frommaking such tax sharing payments under the MacAndrews & Forbes TaxSharing Agreement other than in respect of state, local and federaltaxes. The MacAndrews & Forbes Tax Sharing Agreement was amended,effective as of January  1,  2001, to eliminate a contingentpayment to Revlon, Inc. under certain circumstances in return for a$10  million note by MacAndrews & Forbes Holdings, withinterest at 12% and with interest and principal payable inDecember  2005, which was paid in full. As a result of tax netoperating losses, there were no federal tax payments or payments inlieu of taxes by Revlon, Inc. or Products Corporation pursuant to theMacAndrews & Forbes Tax Sharing Agreement in respect of 2004.

Following the closing of the Revlon Exchange Transactions, Revlon,Inc. became the parent of a new consolidated group for federal incometax purposes and Products Corporation's federal taxable income andloss will be included in such group's consolidated tax returns.Accordingly, Revlon, Inc. and Products Corporation entered into a taxsharing agreement (the ‘‘Revlon Tax SharingAgreement’’) pursuant to which Products Corporation will berequired to pay to Revlon, Inc. amounts equal to the taxes thatProducts Corporation would otherwise have had to pay if ProductsCorporation were to file separate federal, state or local income taxreturns, limited to the amount, and payable only at such times, asRevlon, Inc. will be required to make payments to the applicable taxingauthorities. The 2004 Credit Agreement does not prohibit payments fromProducts Corporation to Revlon, Inc. to the extent required under theRevlon Tax Sharing Agreement. As a result of tax net operating losses,there were no federal tax payments or payments in lieu of taxes fromProducts Corporation to Revlon, Inc. pursuant to the Revlon Tax SharingAgreement in respect of 2004. The Company expects that there will befederal alternative minimum tax payments of $0.1  million fromProducts Corporation to Revlon, Inc. pursuant to the Revlon Tax SharingAgreement in respect of 2005.

As a result of dealing withsuppliers and vendors in a number of foreign countries, ProductsCorporation enters into foreign currency forward exchange contracts andoption contracts from time to time to hedge certain cash flowsdenominated in foreign currencies. There were foreign currency forwardexchange contracts with a notional amount of $31.9  millionoutstanding at December  31,  2005. The fair value of foreigncurrency forward exchange contracts outstanding at December31,  2005 was $(0.2) million.

43

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Disclosures about ContractualObligations and Commercial Commitments

The following tableaggregates all contractual commitments and commercial obligations thataffect the Company's financial condition and liquidity position asof December  31,  2005:

|                                           |  |                                            |         |                  |  |           |         |           |  |              |         |        |  |        |         |        |  |        |         |        |  |  |
|-------------------------------------------|--|--------------------------------------------|---------|------------------|--|-----------|---------|-----------|--|--------------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--|
|                                      |  | PaymentsDue by Period(dollars in millions) |
| Contractual Obligations                   |  | Total                                      |         | Less than 1 year |  | 1-3 years |         | 3-5 years |  | After 5years |
| Long-term Debt, including Current Portion |  | $                                          | 1,417.0 |             |  | $         | — |      |  | $            | 327.0   |   |  | $      | 700.0   |   |  | $      | 390.0   |   |
| Interest on Long-term Debt (a)            |  |                                       | 571.6   |             |  |      | 136.0   |      |  |         | 246.1   |   |  |   | 180.2   |   |  |   | 9.3     |   |
| Capital Lease Obligations                 |  |                                       | 5.2     |             |  |      | 2.2     |      |  |         | 2.7     |   |  |   | 0.3     |   |  |   | — |   |
| Operating Leases                          |  |                                       | 131.2   |             |  |      | 15.7    |      |  |         | 31.9    |   |  |   | 29.4    |   |  |   | 54.2    |   |
| PurchaseObligations (b)                   |  |                                       | 46.1    |             |  |      | 46.1    |      |  |         | — |   |  |   | — |   |  |   | — |   |
| Other Long-termObligations (c)            |  |                                       | 32.7    |             |  |      | 16.8    |      |  |         | 15.4    |   |  |   | 0.5     |   |  |   | — |   |
| TotalContractual Cash Obligations         |  | $                                          | 2,203.8 |             |  | $         | 216.8   |      |  | $            | 623.1   |   |  | $      | 910.4   |   |  | $      | 453.5   |   |
|                                           |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                             |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | Consistsof interest primarily on the 91⁄2% Senior Notesand the 8 5/8% Senior Subordinated Notes and the$700  million Term Loan Facility under the 2004 Credit Agreementthrough the respective maturity dates based upon assumptions regardingthe amount of debt outstanding under the 2004 Credit Agreement andassumed interest rates. |

|     |                                                                                                                                                                                                                                                                                                                                         |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | Consists of purchasecommitments for finished goods, raw materials, components and servicespursuant to enforceable and legally binding obligations which includeall significant terms, including fixed or minimum quantities to bepurchased; fixed, minimum or variable price provisions; and theapproximate timing of the transactions. |

|     |                                                                                                                                                                                                                                                                                                    |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | Consists primarily of obligations related toadvertising, insurance, employment contracts and other personnelservice contracts. Such amounts exclude severance and other contractualcommitments related to restructuring, which are discussed under‘‘Restructuring Costs’’. |

Off-Balance Sheet Transactions

The Company does notmaintain any off-balance sheet transactions, arrangements, obligationsor other relationships with unconsolidated entities or others that arereasonably likely to have a material current or future effect on theCompany's financial condition, changes in financial condition,revenues or expenses, results of operations, liquidity, capitalexpenditures or capital resources.

Recent AccountingPronouncements

In May  2005, the FASB issued SFAS No. 154,‘‘Accounting Changes and Error Corrections.’’SFAS No. 154 requires retroactive application of a voluntary change inaccounting principle to prior period financial statements unless it isimpracticable. SFAS No. 154 also requires that a change in method ofdepreciation, amortization or depletion for long-lived, non-financialassets be accounted for as a change in accounting estimate that isaffected by a change in accounting principle. SFAS No. 154 replaces APBOpinion No. 20, ‘‘Accounting Changes’’ and SFASNo. 3, ‘‘Reporting Accounting Changes in Interim FinancialStatements’’. SFAS No. 154 is effective for fiscal yearsbeginning after December  15,  2005. The Company will adoptthe provisions of SFAS No. 154 as of January  1,  2006 anddoes not expect that its adoption will have a material impact on itsresults of operations or financial condition.

In December2004, the FASB issued SFAS No. 123 (revised 2004),‘‘Share-Based Payment,’’ an amendment to FASBStatements Nos. 123 and 95 (‘‘SFAS No.123(R)’’), which replaces SFAS No. 123, and supercedes APBOpinion No. 25, ‘‘Accounting for Stock Issued toEmployees.’’ SFAS No. 123(R) requires all share-basedpayments to employees, including grants of employee stock options, tobe recognized in the financial statements based on their fair values.In April  2005, the SEC adopted a rule allowing companies toimplement SFAS No. 123(R) at the beginning of their next fiscal yearthat begins after June  15,  2005, which for the Company willbe effective beginning January  1,  2006. The Company willuse the modified prospective transition method, utilizing theBlack-Scholes option pricing model for the calculation of the fairvalue of its employee stock options. Under the modified prospectivemethod, stock option awards that are granted, modified or settled afterJanuary  1,  2006 will be measured and accounted for inaccordance with SFAS No. 123(R). Compensation cost for stock optionawards granted prior to, but 

44

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not vested, as of January  1,2006 would be based on the grant date attributes originally used tovalue those awards for pro forma purposes under SFAS No. 123. TheCompany expects the adoption of SFAS No. 123(R) will result inapproximately $10  million in additional expenses for fiscal year2006. This estimate is based on the number of unvested optionsoutstanding as of January 1, 2006 and the estimated number of optionsto be granted in 2006. This estimate could change based on a number offactors, including differences in the estimate of the number of optionsgranted before 2006 which are forfeited during 2006 and the number ofoptions actually granted in 2006 and the fair value of these options attheir grant date.

In November  2004, the FASB issued SFASNo. 151, ‘‘Inventory Costs — An Amendment of ARB No.43, Chapter 4.’’ SFAS No. 151 amends the guidance in ARBNo. 43, Chapter 4, ‘‘Inventory Pricing,’’ toclarify the accounting for abnormal amounts of idle facility expense,freight, handling costs and wasted materials (spoilage). Among otherprovisions, the new rule requires that the aforementioned items berecognized as current-period charges. Additionally, SFAS No. 151requires that the allocation of fixed production overheads to the costsof conversion be based on the normal capacity of the productionfacilities. SFAS No. 151 is effective for fiscal years beginning afterJune  15,  2005 and is required to be adopted by the Companybeginning on January  1,  2006. During the third quarter of2005, the Company early adopted the provisions of SFAS No. 151, whichadoption did not have a material impact on the Company’sconsolidated results of operations and financial position.

Inflation

In general, the Company's costs are affectedby inflation and the effects of inflation may be experienced by theCompany in future periods. Management believes, however, that sucheffects have not been material to the Company during the past threeyears in the U.S. and in foreign non-hyperinflationary countries. TheCompany operates in certain countries around the world, such asArgentina, Brazil, Venezuela and Mexico, which have in the pastexperienced hyperinflation. In hyperinflationary foreign countries, theCompany attempts to mitigate the effects of inflation by increasingprices in line with inflation, where possible, and efficiently managingits working capital levels.

Subsequent Events

See‘‘Part I, Item 1 — RecentDevelopments.’’

Item 7A.    Quantitative andQualitative Disclosures About Market Risk

Interest RateSensitivity

The Company has exposure to changing interest ratesprimarily under the Term Loan Facility and Multi-Currency Facility ofthe 2004 Credit Agreement. The Company manages interest rate riskthrough the use of a combination of fixed and floating rate debt. TheCompany from time to time makes use of derivative financial instrumentsto adjust its fixed and floating rate ratio. There were no suchderivative financial instruments outstanding at December31,  2005. The table below provides information about theCompany's indebtedness that is sensitive to changes in interestrates. The table presents cash flows with respect to principal onindebtedness and related weighted average interest rates by expectedmaturity dates. Weighted average variable rates are based on impliedforward rates in the yield curve at December  31,  2005. Theinformation is presented in U.S. dollar equivalents, which is theCompany's reporting currency.

Exchange RateSensitivity

The Company manufactures and sells its products ina number of countries throughout the world and, as a result, is exposedto movements in foreign currency exchange rates. In addition, a portionof the Company's borrowings are denominated in foreign currencies,which are also subject to market risk associated with exchange ratemovement. The Company from time to time hedges major foreign currencycash exposures generally through foreign exchange forward and optioncontracts. Products Corporation enters into these contracts with majorfinancial institutions to minimize counterparty risk. These contracts

45

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generally have a duration of less thantwelve months and are primarily against the U.S. dollar. In addition,Products Corporation enters into foreign currency swaps to hedgeintercompany financing transactions. The Company does not hold or issuefinancial instruments for trading purposes.

Expected maturitydate for the year ended December 31,(dollars in millions, exceptfor rate information)

|                                                  |  |        |         |         |  |        |         |        |  |        |         |            |  |        |         |                           |  |        |         |         |  |        |         |         |  |        |         |        |  |        |         |        |  |  |
|--------------------------------------------------|--|--------|---------|---------|--|--------|---------|--------|--|--------|---------|------------|--|--------|---------|---------------------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|--------|--|--------|---------|--------|--|--|
| Debt                                             |  | 2006   |         | 2007    |  | 2008   |         | 2009   |  | 2010   |         | Thereafter |  | Total  |         | FairValueDecember31, 2005 |
| Short-term variablerate (various currencies)     |  | $      | 9.0     |    |  | $      | — |   |  | $      | — |       |  | $      | — |                      |  | $      | — |    |  | $      | — |    |  | $      | 9.0     |   |  | $      | 9.0     |   |
| Average interest rate(a)                         |  |   | 14.2    | %  |  |   | — |   |  |   | — |       |  |   | — |                      |  |   | — |    |  |   | — |    |  |   | — |   |  |   | — |   |
| Long-term fixed rate — thirdparty ($US)    |  |   | — |    |  |   | — |   |  |   | 327.0   | *     |  |   | — |                      |  |   | — |    |  |   | 390.0   |    |  |   | 717.0   |   |  |   | 673.4   |   |
| Average interest rate                            |  |   | — |    |  |   | — |   |  |   | 8.6     | %     |  |   | — |                      |  |   | — |    |  |   | 9.5     | %  |  |   | — |   |  |   | — |   |
| Long-term variable rate — thirdparty ($US) |  |   | — |    |  |   | — |   |  |   | — |       |  |   | — |                      |  |   | 700.0   |    |  |   | — |    |  |   | 700.0   |   |  |   | 700.0   |   |
| Average interest rate (a)                        |  |   | — |    |  |   | — |   |  |   | — |       |  |   | — |                      |  |   | 11.3    | %  |  |   | — |    |  |   | — |   |  |   | — |   |
| Total debt                                       |  | $      | 9.0     |    |  | $      | — |   |  | $      | 327.0   |       |  | $      | — |                      |  | $      | 700.0   |    |  | $      | 390.0   |    |  | $      | 1,426.0 |   |  | $      | 1,382.4 |   |
|                                                  |

|                                                |  |                             |        |                                   |  |                                |      |                            |  |        |      |        |  |        |         |         |  |  |
|------------------------------------------------|--|-----------------------------|--------|-----------------------------------|--|--------------------------------|------|----------------------------|--|--------|------|--------|--|--------|---------|---------|--|--|
| ForwardContracts                               |  | AverageContractualRate $/FC |        | Original US Dollar NotionalAmount |  | ContractValueDecember 31, 2005 |      | Fair ValueDecember 31,2005 |
| Buy Euros/Sell USD                             |  |                        | 1.2484 |                              |  | $                              | 0.4  |                       |  | $      | 0.4  |   |  | $      | — |    |
| BuyMexican Pesos/Sell USD                      |  |                        | 0.0927 |                              |  |                           | 0.3  |                       |  |   | 0.3  |   |  |   | — |    |
| Sell British Pounds/Buy USD                    |  |                        | 1.7835 |                              |  |                           | 4.9  |                       |  |   | 5.0  |   |  |   | 0.1     |    |
| Sell Australian Dollars/Buy USD                |  |                        | 0.7470 |                              |  |                           | 7.2  |                       |  |   | 7.4  |   |  |   | 0.2     |    |
| Sell CanadianDollars/Buy USD                   |  |                        | 0.8374 |                              |  |                           | 9.1  |                       |  |   | 8.8  |   |  |   | (0.3    | )  |
| Sell South African Rand/Buy USD                |  |                        | 0.1484 |                              |  |                           | 3.8  |                       |  |   | 3.6  |   |  |   | (0.2    | )  |
| Sell Japanese Yen/Buy USD                      |  |                        | 0.0085 |                              |  |                           | 1.0  |                       |  |   | 1.0  |   |  |   | — |    |
| Sell Hong Kong Dollars/BuyUSD                  |  |                        | 0.1290 |                              |  |                           | 0.3  |                       |  |   | 0.3  |   |  |   | — |    |
| Buy Australian Dollars/Sell New ZealandDollars |  |                        | 1.0959 |                              |  |                           | 4.0  |                       |  |   | 4.0  |   |  |   | — |    |
| Buy New Zealand Dollars/Sell USD               |  |                        | 0.7050 |                              |  |                           | 0.9  |                       |  |   | 0.9  |   |  |   | — |    |
| Total forward contracts                        |  |                        |   |                              |  | $                              | 31.9 |                       |  | $      | 31.7 |   |  | $      | (0.2    | )  |
|                                                |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                  |
|-----|------------------------------------------------------------------------------------------------------------------|
| (a) | Weightedaverage variable rates are based upon implied forward rates from theyield curves at December  31,  2005. |

|   |                                                                                                                                                                                                                                                |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| * | While the 8 5/8% SeniorSubordinated Notes are due in March  2008, under the 2004 CreditAgreement, Products Corporation must refinance these notes byOctober  30,  2007, such that not more than $25.0million of such notes remain outstanding. |

|              |                                             |
|--------------|---------------------------------------------|
| Item8.  | Financial Statements and Supplementary Data |

Reference is made to the Index on page F-1 of the Company’sConsolidated Financial Statements and the Notes thereto containedherein.

|               |                                                                                     |
|---------------|-------------------------------------------------------------------------------------|
| Item 9.  | Changes in andDisagreements with Accountants on Accounting and FinancialDisclosures |

None.

Item 9A.    Controls andProcedures

**(a)    Disclosure Controls andProcedures.**    The Company maintains disclosure controlsand procedures that are designed to ensure that information required tobe disclosed in the Company's reports under the SecuritiesExchange Act of 1934, as amended, is recorded, processed, summarizedand reported 

46

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within the time periods specified in theSEC's rules and forms, and that such information is accumulatedand communicated to management, including the Company's ChiefExecutive Officer and Chief Financial Officer, as appropriate, to allowtimely decisions regarding required disclosure. The Company'smanagement, with the participation of the Company's ChiefExecutive Officer and Chief Financial Officer, has evaluated theeffectiveness of the Company's disclosure controls and proceduresas of the end of the fiscal year covered by this Annual Report on Form10-K. The Company's Chief Executive Officer and Chief FinancialOfficer have concluded that, as of the end of the period covered bythis Annual Report on Form 10-K, the Company's disclosure controlsand procedures were effective.

**(b)    Management’s Annual Report on InternalControl over Financial Reporting.**    The Company’smanagement is responsible for establishing and maintaining adequateinternal control over financial reporting. The Company’sinternal control system was designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparationand fair presentation of published financial statements in accordancewith generally accepted accounting principles and includes thosepolicies and procedures that:

|              |                                                                                                                                              |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------|
| •  | pertainto the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of its assets; |

|              |                                                                                                                                                                                                                                                                                                                      |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | provide reasonable assurance thattransactions are recorded as necessary to permit preparation of itsfinancial statements in accordance with generally accepted accountingprinciples, and that its receipts and expenditures are being made onlyin accordance with authorizations of its management and directors;and |

|              |                                                                                                                                                                                                           |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | provide reasonable assuranceregarding prevention or timely detection of unauthorized acquisition,use or disposition of the Company's assets that could have amaterial effect on its financial statements. |

Because of itsinherent limitations, internal control over financial reporting may notprevent or detect misstatements. Management's projections of anyevaluation of the effectiveness of internal control over financialreporting as to future periods are subject to the risks that controlsmay become inadequate because of changes in conditions, or that thedegree of compliance with the policies or procedures maydeteriorate.

The Company’s management assessed theeffectiveness of the Company’s internal control over financialreporting as of December  31,  2005 and in making thisassessment used the criteria set forth by the Committee of SponsoringOrganizations of the Treadway Commission in Internal Control-IntegratedFramework in accordance with the standards of the Public CompanyAccounting Oversight Board (United States).

Revlon, Inc.'smanagement determined that as of December  31,  2005, theCompany's internal control over financial reporting waseffective.

KPMG LLP, the Company's independent registeredpublic accounting firm that audited the Company's financialstatements included in this Annual Report on Form 10-K for the periodended December  31,  2005, has issued an audit report onmanagement's assessment of the Company's internal controlover financial reporting. This report appears on page F-3.

**(c)    Changes in Internal Control Over FinancialReporting.**    There have not been any changes in theCompany's internal control over financial reporting during thefiscal quarter ended December  31,  2005 that have materiallyaffected, or are reasonably likely to materially affect, theCompany's internal control over financial reporting.

Item 9B.    Other Information

As previouslyannounced by the Company on January  18,  2006, Thomas E.McGuire, the Company's Executive Vice President and ChiefFinancial Officer, and David L. Kennedy, the Company's ExecutiveVice President and President of the Company's internationaloperations, will rotate their positions and 

47

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responsibilities, effective in earlyMarch  2006, after the Company files this Annual Report on Form10-K for the year ended December  31,  2005. In connectionwith these changes, effective March 2, 2006, Products Corporationentered into amendments to the employment agreements of each of Messrs.McGuire and Kennedy to reflect their new responsibilities and toprovide for a term that would expire effective two years after writtennotice of non-extension of the agreement. A copy of such employmentagreement amendments are attached to this Form 10-K as Exhibits 10.7and 10.9 and the terms of such amendments are incorporated herein byreference.

Forward Looking Statements

This AnnualReport on Form 10-K for the year ended December  31,  2005,as well as other public documents and statements of the Company,contain forward-looking statements that involve risks anduncertainties, which are based on the beliefs, expectations, estimates,projections, forecasts, plans, anticipations, targets, outlooks,initiatives, destinations, visions, objectives, strategies,opportunities, drivers and intents of the Company’s management.The Company's actual results may differ materially from thosediscussed in such forward-looking statements. Such statements include,without limitation, the Company's expectations and estimates(whether qualitative or quantitative) as to:

|  |           |                                                                                                                                                                                                                                                               |
|--|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (i)  | the Company's future financialperformance, including the Company's belief that it hasstrengthened its organizational capabilities (and its expectation tocontinue to do so) and that it has strengthened its relationships withits key retailers in the U.S.; |

|  |            |                                                                                                                                                                                                                                                                                                              |
|--|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (ii)  | the effect on sales of weak economicconditions, political uncertainties, military actions, terroristactivities, adverse currency fluctuations, category weakness,competitive activities, retailer inventory management and changes inconsumer purchasing habits, including with respect to shoppingchannels; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iii)  | the Company'sbelief that the continued implementation and refinement to its plancould include taking advantage of additional opportunities toreposition, repackage and/or reformulate one or more of its brands orproduct lines and/or launching new brands or product lines and/orfurther refining its approach to retail merchandising, including,without limitation, the Company’s plans to re-enter the U.S.prestige fragrance market in 2006, any of which, whose intended purposewould be to create value through profitable growth, could result in theCompany making investments and/or recognizing charges related toexecuting against such opportunities; |

|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                              |
|--|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iv)  | the Company's plans regardingthe Accelerated Growth Phase of its plan, including the Company'splans to capitalize on the actions taken during the previous phases ofits plan, and the Company's expectation that such actions wouldhelp it achieve the objective of balancing top-line growth with animproved operating profit margin (including a targeted operating profitmargin of approximately 12% by the end of 2008); |

|  |           |                                                                                             |
|--|-----------|---------------------------------------------------------------------------------------------|
|  | (v)  | the Company's plans to furtherimprove its new product development and introduction process; |

|  |            |                                                                                                                |
|--|------------|----------------------------------------------------------------------------------------------------------------|
|  | (vi)  | the Company's plans to continueto increase the effectiveness of its display walls across categoriesand brands; |

|  |             |                                                                                                                                                                                       |
|--|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (vii)  | the Company'splans to drive efficiencies across its overall supply chain, includingreducing manufacturing costs by continuing to rationalize componentsand by sourcing strategically; |

|  |              |                                                                                               |
|--|--------------|-----------------------------------------------------------------------------------------------|
|  | (viii)  | the Company's plans tooptimize the effectiveness of its advertising, marketing andpromotions; |

|  |            |                                                                                                                                                                                                                                |
|--|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (ix)  | the Company'splans to continue training and development of its organization so thatit may continue to improve its capabilities to execute theCompany's strategies, while providing enhanced job satisfactionfor its employees; |

|  |           |                                                                                  |
|--|-----------|----------------------------------------------------------------------------------|
|  | (x)  | theCompany's current expectation and beliefs regarding its two brandinitiatives; |

|  |            |                                                                                                                                                      |
|--|------------|------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xi)  | the Company'sbelief that the Almay initiative will build on its healthy beautyheritage and desire among consumers for simplicity andpersonalization; |

48

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|  |             |                                                                                                                                                                                                        |
|--|-------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xii)  | theCompany's belief that its Vital Radiance initiative, focused onthe more mature cosmetics consumer, will serve an affluent and growingconsumer demographic currently underserved in the marketplace; |

|  |              |                                                                                                                                                                  |
|--|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xiii)  | the Company's expectationthat the first quarter of 2006 will benefit from incremental initialshipments associated with the launch of these two brandinitiatives; |

|  |             |                                                                                                                                                                                                                                                                                                               |
|--|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xiv)  | the Company'sexpectation that the cash flow impact of the brand initiatives from itsinvestment in permanent displays, including displays for its existingbusinesses and the brand initiatives, will be in the range of $85million to $95  million during 2006, returning to more normalizedlevels thereafter; |

|  |            |                                                                                                                                                                      |
|--|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xv)  | theCompany's expectation that due to the brand initiatives, workingcapital will return to more normalized levels in relation to salesduring the second half of 2006; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xvi)  | the Company’s plans tocontinue to strengthen its balance sheet and capital structure,including Revlon, Inc.’s plans to conduct a $110  millionrights offering and contribute the proceeds from such equity issuanceto Products Corporation by March  31,  2006 to promptlyreduce its debt by redeeming approximately $110  million of its8 5/8% Senior Subordinated Notes (as well as thepossible accounting impact of such transaction on the Company’sbasic and diluted loss per common share), as well as its plans torefinance the balance of Products Corporation’s8 5/8% Senior Subordinated Notes by October30,  2007 prior to their maturity and Revlon, Inc.’s plansto conduct an additional equity issuance of $75  million byJune  30,  2006; |

|  |              |                                                                                                                                                                                                                          |
|--|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xvii)  | restructuring activities,restructuring costs, the timing of restructuring payments and annualsavings and other benefits from such activities (including as describedin ‘‘Recent Developments’’); |

|  |               |                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--|---------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xviii)  | operating revenues, cash on hand,net cash proceeds of the planned $75  million equity issuance, andavailability of borrowings under Products Corporation's 2004Credit Agreement, the 2004 Consolidated MacAndrews & Forbes Line ofCredit and other permitted lines of credit being sufficient to satisfythe Company's operating expenses in 2006, including cashrequirements referred to in item (xx) below; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xix)  | the availability of funds fromProducts Corporation's 2004 Credit Agreement, the 2004Consolidated MacAndrews & Forbes Line of Credit and other permittedlines of credit, restructuring indebtedness, selling assets oroperations, capital contributions and/or loans from MacAndrews &Forbes, the Company's other affiliates and/or third parties and/orthe sale of additional equity securities of Revlon, Inc. or additionaldebt securities of Products Corporation and the net cash proceeds ofthe planned $75  million equity issuance described in‘‘Recent Developments’’; |

|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|--|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xx)  | the Company's uses of funds,including amounts required for the payment of operating expenses,including expenses in connection with the continued implementation of,and refinement to, the Company's plan (including in connectionwith its brand initiatives), payments in connection with theCompany's purchases of permanent wall displays, capitalexpenditure requirements, restructuring programs (including asdescribed in ‘‘Recent Developments’’), debtservice payments and costs and regularly scheduled pension andpost-retirement plan contributions, and its estimates of operatingexpenses, working capital expenses, wall display costs, capitalexpenditures, cash contributions to the Company's pension plansand post-retirement benefit plans, debt service payments (includingpayments required under Products Corporation's debt instruments)and charges in connection with the Company's growth plan; |

|  |             |                                                                    |
|--|-------------|--------------------------------------------------------------------|
|  | (xxi)  | matters concerning theCompany's market-risk sensitive instruments; |

|  |              |                                                                            |
|--|--------------|----------------------------------------------------------------------------|
|  | (xxii)  | the effects of the Company'sadoption of certain accounting principles; and |

49

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|  |               |                                                                                                                                                                                                                                                                                                                                                           |
|--|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xxiii)  | theCompany's plan to efficiently manage its cash and working capital,including, among other things, by carefully managing inventory levels,centralizing purchasing to secure discounts and efficiencies inprocurement, and providing additional discounts to U.S. customers formore timely payment of receivables and carefully managing accountspayable. |

Statements that are not historical facts, includingstatements about the Company's beliefs and expectations, areforward-looking statements. Forward-looking statements can beidentified by, among other things, the use of forward-looking languagesuch as ‘‘estimates,’’‘‘objectives,’’‘‘visions,’’‘‘projects,’’‘‘forecasts,’’‘‘plans,’’ ‘‘targets,’’‘‘strategies,’’‘‘opportunities,’’ ‘‘drivers,‘‘ ‘‘believes,’’‘‘intends,’’‘‘destinations,’’‘‘outlooks,’’‘‘initiatives,’’‘‘expects,’’ ‘‘scheduledto,’’ ‘‘anticipates, ‘‘‘‘seeks,’’ ‘‘may,’’‘‘will,’’ or ‘‘should’’or the negative of those terms, or other variations of those terms orcomparable language, or by discussions of strategy, targets, models orintentions. Forward-looking statements speak only as of the date theyare made, and except for the Company's ongoing obligations underthe U.S. federal securities laws, the Company undertakes no obligationto publicly update any forward-looking statements, whether as a resultof new information, future events or otherwise. Investors are advised,however, to consult any additional disclosures the Company made in itsQuarterly Reports on Form 10-Q and Current Reports on Form 8-K, in eachcase filed with the SEC in 2005 and 2006 (which, among other places,can be found on the SEC's website at http://www.sec.gov, as wellas on the Company's website at www.revloninc.com). The informationavailable from time to time on such websites shall not be deemedincorporated by reference into this Annual Report on Form 10-K.Additionally, the business and financial materials and any otherstatement or disclosure on, or made available through, theCompany's websites shall not be considered a ‘‘freewriting prospectus’’ under the SEC's Rule 405 of theSecurities Act of 1933, as amended, unless specifically identified assuch. A number of important factors could cause actual results todiffer materially from those contained in any forward-lookingstatement. In addition to factors that may be described in theCompany's filings with the SEC, including this filing, thefollowing factors, among others, could cause the Company's actualresults to differ materially from those expressed in anyforward-looking statements made by the Company:

|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (i)  | unanticipated circumstances orresults affecting the Company's financial performance, includingdecreased consumer spending in response to weak economic conditions orweakness in the category, changes in consumer preferences, such asreduced consumer demand for the Company's color cosmetics andother current products, changes in consumer purchasing habits,including with respect to shopping channels, lower than expected retailcustomer acceptance or consumer acceptance of the Company’sbrand initiatives, decreased sales of the Company’s existingproducts as a result of the Company’s brand initiatives andchanges in the competitive environment, actions by the Company’scustomers, such as retailer inventory management, and actions by theCompany's competitors, including business combinations,technological breakthroughs, new products offerings, promotionalspending and marketing and promotional successes, including increasesin market share; |

|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (ii)  | the effects ofand changes in economic conditions (such as inflation, monetaryconditions and foreign currency fluctuations, as well as in trade,monetary, fiscal and tax policies in international markets); politicalconditions (such as military actions and terrorist activities); as wellas the effects of and changes in category weakness, in competitiveactivities, in retailer inventory management and in consumer purchasinghabits, including with respect to shopping channels; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|--|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iii)  | unanticipated costs or difficultiesor delays in completing projects associated with the continuedimplementation of, and refinement to, the Company's plan or lowerthan expected revenues or inability to achieve profitability over thelong term as a result of such plan, including lower than expectedsales, or higher than expected costs, including as may arise from anyadditional repositioning, repackaging and/or reformulating of one ormore of the Company's brands or product lines and/or launching ofnew brands or product lines and/or further refining its approach toretail merchandising, including, without limitation, difficulties,delays or increased costs in connection with the Company’s plansto re-enter the prestige fragrance market in 2006; |

50

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|  |            |                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (iv)  | difficulties,delays or unanticipated costs in implementing the Company's plansregarding the Accelerated Growth Phase of its plan, includingdifficulties, delays or unanticipated costs in taking actions tocapitalize on the actions taken during the previous phases of its plan,which could affect the Company's ability to achieve its objectiveof balancing top-line growth with an improved operating profitmargin; |

|  |           |                                                                                                                                                                                                                                                                                                                                                                                              |
|--|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (v)  | difficulties, delays orunanticipated costs in connection with the Company's plans tofurther improve its new product development and introduction process,which could affect the Company's ability to effectively launch newand restaged products and/or reposition, repackage and/or reformulateone or more of the Company's brands or product lines and generaterevenues from such sources; |

|  |            |                                                                                                                                               |
|--|------------|-----------------------------------------------------------------------------------------------------------------------------------------------|
|  | (vi)  | difficulties, delays orunanticipated costs in implementing the Company's plans tocontinue to increase the effectiveness of its display walls; |

|  |             |                                                                                                                                                                                                                                      |
|--|-------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (vii)  | difficulties, delays orunanticipated costs in implementing the Company's plans to driveefficiencies across its overall supply chain, including reducingmanufacturing costs by rationalizing components and by sourcingstrategically; |

|  |              |                                                                                                                                                          |
|--|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (viii)  | difficulties,delays or unanticipated costs in implementing the Company's plansto optimize the effectiveness of its advertising, marketing andpromotions; |

|  |            |                                                                                                                                                                                                                                                               |
|--|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (ix)  | difficulties, delaysor unanticipated costs in the Company continuing to train and developits organization so that it may continue to improve its capabilities toexecute the Company's strategies, while providing enhanced jobsatisfaction for its employees; |

|  |           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (x)  | difficulties, delays or unanticipatedcircumstances or costs associated with the Company’s brandinitiatives, including the Company's inability to timely implementits brand initiatives, higher than expected returns in connection withthe brand initiatives, weaker than expected retail customer acceptanceand/or consumer demand for the products launched pursuant to the brandinitiatives, the possibility that the Company's product pricingstrategies for the brand initiatives will not be accepted by theCompany's retail customers and/or consumers or that the Companymay experience decreased sales of its existing products as a result ofthe products launched and sold under these initiatives and thepossibility that the Company's current expectations and beliefsregarding the brand initiatives may turn out to be incorrect, or asapplicable, overestimates or underestimates; |

|  |            |                                                                                                                                                 |
|--|------------|-------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xi)  | the Almay initiative does notachieve its anticipated marketing effects and less than anticipatedconsumer or retail customer acceptance thereof; |

|  |             |                                                                                                                                                                                                    |
|--|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xii)  | the Vital Radiance brand initiativetargeted to the more mature consumer does not achieve its anticipatedmarketing effects and less than anticipated consumer or retail customeracceptance thereof; |

|  |              |                                                                                                                                                                                                                                                                                                                                                                                            |
|--|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xiii)  | theCompany's inability to achieve the anticipated benefits from thesebrand initiatives in the first quarter of 2006, such as due to lessthan expected shipments during the first quarter of 2006 as a result ofless than anticipated acceptance of these initiatives from theCompany's retail customers and/or consumers or other difficulties,delays or unexpected costs related thereto; |

|  |             |                                                                                                                        |
|--|-------------|------------------------------------------------------------------------------------------------------------------------|
|  | (xiv)  | higher than anticipated costs forpermanent displays or unforeseen circumstances affecting the timing orlevels thereof; |

|  |            |                                                                                                           |
|--|------------|-----------------------------------------------------------------------------------------------------------|
|  | (xv)  | higher thananticipated working capital or unforeseen circumstances affecting thetiming or levels thereof; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--|-------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xvi)  | difficulties, delays orunanticipated costs in, or the Company's inability to consummate,transactions to strengthen its balance sheet and capital structure,including difficulties, delays or increased costs associated with, orRevlon, Inc.'s inability to consummate, in whole or in part, the$110  million rights offering by March  31,  2006 (orunanticipated changes in the accounting treatment of such transactionon the Company’s basic and diluted loss per common |

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|  |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |   | share), to use the proceeds from such rightsoffering to promptly reduce Products Corporation’s debt,including to redeem approximately $110  million of its8 5/8% Senior Subordinated Notes, or otherdifficulties, delays or unexpected costs related thereto, ordifficulties, delays or increased costs associated with, or theinability to consummate, in whole or in part, the refinancing of thebalance of Products Corporation’s 8 5/8%Senior Subordinated Notes by October  30,  2007 prior totheir maturity, or difficulties, delays or increased costs associatedwith conducting, or Revlon, Inc.’s inability to consummate, inwhole or in part, the additional planned $75  million equityissuance by June  30,  2006; |

|  |              |                                                                                                                                                                                                                              |
|--|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xvii)  | difficulties, delays orunanticipated costs or less than expected savings and other benefitsresulting from the Company's restructuring activities (includingas described in ‘‘Recent Developments’’); |

|  |               |                                                                                                                                                                                |
|--|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xviii)  | lower than expected operatingrevenues, the inability to secure capital contributions or loans fromMacAndrews & Forbes, the Company's other affiliates and/orthird parties; |

|  |             |                                                                                                                                                                                                                                                                                                                                                                                                                       |
|--|-------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xix)  | theunavailability of funds under Products Corporation's 2004 CreditAgreement, the 2004 Consolidated MacAndrews & Forbes Line of Creditor other permitted lines of credit, restructuring indebtedness, sellingassets or operations, the sale of additional equity or debt securitiesor from Revlon, Inc.’s planned $75  million equity issuancedescribed in ‘‘Recent Developments’’; |

|  |            |                                                                                                                                                                                                                                                                                                                            |
|--|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | (xx)  | higher than expected operatingexpenses (including in connection with the brand initiatives), salesreturns, working capital expenses, wall display costs, capitalexpenditures, restructuring costs, regularly scheduled cash pensionplan contributions, post-retirement benefit plan contributions or debtservice payments; |

|  |             |                                                                                                                         |
|--|-------------|-------------------------------------------------------------------------------------------------------------------------|
|  | (xxi)  | interest rateor foreign exchange rate changes affecting the Company and itsmarket-risk sensitive financial instruments; |

|  |              |                                                                                         |
|--|--------------|-----------------------------------------------------------------------------------------|
|  | (xxii)  | unanticipated effects of theCompany's adoption of certain new accounting standards; and |

|  |               |                                                                                                        |
|--|---------------|--------------------------------------------------------------------------------------------------------|
|  | (xxiii)  | difficulties, delays or theinability of the Company to efficiently manage its cash and workingcapital. |

Factors other than those listed above could also causethe Company's results to differ materially from expected results.This discussion is provided as permitted by the Private SecuritiesLitigation Reform Act of 1995.

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Part III

(Dollars in Part III are actual dollars, not millions)

Item 10.    Directors and Executive Officers of theRegistrant

The following table sets forth certain informationconcerning the Directors of Revlon, Inc. as of December  31,2005, except for Mses. Lee and Seifert, who became Directors of Revlon,Inc. effective January 1, 2006. Each Director holds office until his orher successor is duly elected and qualified or until his or herresignation or removal, if earlier.

|                          |  |                                                |  |  |  |  |
|--------------------------|--|------------------------------------------------|--|--|--|--|
| **Name**                 |  | **Position**                                   |
| Ronald O. Perelman       |  | Chairman of the Board and Director             |
| Jack L.Stahl             |  | President, Chief Executive Officer andDirector |
| Alan S. Bernikow         |  | Director                                       |
| Paul J. Bohan            |  | Director                                       |
| Donald G. Drapkin        |  | Director                                       |
| Professor Meyer Feldberg |  | Director                                       |
| Howard Gittis            |  | Director                                       |
| Edward J. Landau         |  | Director                                       |
| Debra L. Lee             |  | Director                                       |
| Linda Gosden Robinson    |  | Director                                       |
| Kathi P. Seifert         |  | Director                                       |
| Kenneth L. Wolfe         |  | Director                                       |
|                          |

The name, age (as of December31,  2005), principal occupation for the last five years, selectedbiographical information and period of service as a Director of Revlon,Inc. for each of the Directors are set forth below:

**Mr.Perelman (62)** has been Chairman of the Board of Directors ofRevlon, Inc. and of Products Corporation since June  1998 and aDirector of Revlon, Inc. and of Products Corporation since theirrespective formations in 1992. Mr.  Perelman has been Chairman ofthe Board of Managers, Manager and Chief Executive Officer of REVHoldings, which files reports pursuant to the Exchange Act, sinceDecember  2002. He was Chief Executive Officer of REV HoldingsInc. (the predecessor of REV Holdings) from 1997 through December2002 and Chairman of its Board of Directors from 1993 throughDecember  2002. Mr.  Perelman has been Chairman of the Boardand Chief Executive Officer of MacAndrews & Forbes Holdings andvarious of its affiliates since 1980. Mr.  Perelman served asChairman of the Board of Directors of Panavision Inc.(‘‘Panavision’’) until September  2003 andthereafter began service as Co-Chairman. Mr.  Perelman is also aDirector (or member of the Board of Managers, as applicable) of thefollowing companies which are required to file reports pursuant to theExchange Act: Allied Security Holdings LLC (‘‘AlliedSecurity’’), M&F Worldwide Corp. (‘‘M&FWorldwide’’), Panavision and Scientific Games Corporation(‘‘Scientific Games’’).

**Mr.Stahl (52)** has been President and Chief Executive Officer ofRevlon, Inc. and of Products Corporation since February  2002 anda Director of Revlon, Inc. and of Products Corporation sinceMarch  2002. Mr.  Stahl served as President and ChiefOperating Officer of The Coca-Cola Company(‘‘Coca-Cola’’) from February  2000 toMarch  2001. Prior to that, Mr.  Stahl held various seniorexecutive positions at Coca-Cola, where he began his career in 1979.Mr.  Stahl is also a Director of the Cosmetic, Toiletry, andFragrance Association, Vice Chairman of the Board of the United NegroCollege Fund and is a member of the Board of Governors of the Boys& Girls Clubs of America.

**Mr.  Bernikow (65)** hasbeen a Director of Revlon, Inc. and of Products Corporation sinceSeptember  2003. From 1998 until his retirement in May  2003,Mr.  Bernikow served as the Deputy Chief Executive Officer ofDeloitte & Touche LLP (‘‘D&T’’). Priorto that, Mr.  Bernikow held various senior executive positions atD&T and various of its predecessor companies, which he joined in1966. Mr.  Bernikow also serves as a Director and as a member ofthe Audit Committee of Casual Male Retail 

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Group, Inc. and as a Director and Chairman ofthe Audit Committee of Mack-Cali Realty Corporation, each of which arerequired to file reports pursuant to the Exchange Act. Mr.Bernikow is also a director or trustee and serves as Chairman of theaudit committees of certain funds for which UBS Global Asset Management(US) Inc., a wholly-owned subsidiary of UBS AG, or one of itsaffiliates (‘‘UBS’’) serves as investmentadvisor, sub-advisor or manager.

**Mr.  Bohan (60)** hasbeen a Director of Revlon, Inc. since March  2004. Prior to hisretirement in February  2001, Mr.  Bohan was a ManagingDirector of the high-yield bond sales group of Salomon Smith Barney, aunit of Citigroup Inc., a global financial services holding company,having joined Salomon Smith Barney in 1980. Mr.  Bohan is adirector of Haynes International, Inc., which files reports pursuant tothe Exchange Act. Mr.  Bohan also serves as a member of the Boardof Directors of Arena Brands, Inc., which is a privately-held company,and of the Board of Directors of The New York Police & FireWidows' & Children's Benefit Fund. In addition, Mr.Bohan serves on the audit committee of The New York Police & FireWidows' & Children's Benefit Fund.

**Mr.Drapkin (57)** has been a Director of Revlon, Inc. and of ProductsCorporation since their respective formations in 1992. He has been ViceChairman of the Board of MacAndrews & Forbes Holdings and variousof its affiliates since 1987. Mr.  Drapkin was a partner in thelaw firm of Skadden, Arps, Slate, Meagher & Flom LLP for more thanfive years prior to 1987. Mr.  Drapkin is also a Director (ormember of the Board of Managers, as applicable) of the followingcompanies which are required to file reports pursuant to the ExchangeAct: Allied Security, Anthracite Capital, Inc., Nephros Inc., PlayboyEnterprises, Inc. and SIGA Technologies, Inc.

**ProfessorFeldberg (63)** has been a Director of Revlon, Inc. sinceFebruary  1997. Professor Feldberg has been a Senior Advisor withMorgan Stanley since March  2005 and has been the Dean Emeritusand Sanford Bernstein Professor of Leadership and Ethics at ColumbiaBusiness School, New York City, since July  1,  2004. He wasthe Dean of Columbia Business School from July  1989 to June2004. Professor Feldberg is also a Director of the following companieswhich are required to file reports pursuant to the Exchange Act:Federated Department Stores, Inc., PRIMEDIA Inc. and Sappi Limited. Inaddition, Professor Feldberg is also a director or trustee of certainfunds for which UBS serves as investment advisor, sub-advisor ormanager, and a director of certain funds for which UBS FinancialServices Inc. or one of its affiliates serves as investment advisor,administrator or manager. In addition to being a member of theCompany's Audit Committee, Professor Feldberg is also an auditcommittee member of PRIMEDIA Inc.

**Mr.  Gittis (71)**has been a Director of Revlon, Inc. since its formation in 1992.Mr.  Gittis was a Director of, and served as the Vice Chairman of,Products Corporation from June  2002 through March  2004.Mr.  Gittis was Vice Chairman of the Board of Managers and Managerof REV Holdings, which files reports pursuant to the Exchange Act, fromDecember  2002 until March  2004. He was a Director of REVHoldings Inc. (the predecessor of REV Holdings) from its formation in1993 through December  2002 and Vice Chairman of its Board ofDirectors from March  1997 through December  2002. He hasbeen Vice Chairman of the Board of MacAndrews & Forbes Holdings andvarious of its affiliates since 1985. Mr.  Gittis is Chairman ofthe Board, President and Chief Executive Officer of M&F Worldwide.Mr.  Gittis is also a Director of the following companies whichare required to file reports pursuant to the Exchange Act: JonesApparel Group, Inc., Panavision and Scientific Games.

**Mr.  Landau (75)** has been a Director of Revlon, Inc.since June  1996 and of Products Corporation since June 1992. FromFebruary  1998 until his retirement in February  2003,Mr.  Landau was Of Counsel at the law firm of Wolf, Block, Schorrand Solis-Cohen LLP, and was a Senior Partner of Lowenthal, Landau,Fischer & Bring, P.C., a predecessor to such firm, for more thanfive years prior to February  1998. 

**Ms.  Lee(51)** has been a Director of Revlon, Inc. since January  2006.Ms.  Lee is Chairman and Chief Executive Officer of BET Holdings,Inc. (‘‘BET’’), a global media andentertainment company that owns and operates Black EntertainmentTelevision. Ms.  Lee's career at BET began in 1986 as VicePresident and General Counsel. In 1992, she was named Executive VicePresident of Legal Affairs and Publisher of BET's magazinedivision, while continuing to serve as BET's General Counsel. In1995, Ms.  Lee assumed responsibility for BET's strategicbusiness development and was named President and Chief OperatingOfficer in 1996. Prior to joining BET, Ms.  Lee was an attorneywith the Washington, 

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D.C.-based law firm of Steptoe & Johnson.Ms.  Lee serves on the Board of Directors of the followingcompanies which are required to file reports under the Exchange Act:Eastman Kodak Company, Marriott International, Inc. and WGL Holdings,Inc.

**Ms.  Robinson (52)** has been a Director ofRevlon, Inc. since June  1996. Ms.  Robinson has beenChairman of Robinson, Lerer & Montgomery, LLC, a New York Citystrategic communications consulting firm(‘‘RLM’’), since May  1996. Ms.Robinson was Chief Executive Officer of RLM from May  1996 untilJanuary  2002. In March  2000, RLM was acquired by Young& Rubicam Inc. (‘‘Y&R’’), and inOctober  2000, Y&R was acquired by the WPP Group plc(‘‘WPP’’). Ms.  Robinson served as ViceChairman of Y&R from March  2000 until December31,  2004. For more than five years prior to May  1996,Ms.  Robinson was Chairman of the Board and Chief ExecutiveOfficer of Robinson Lerer Sawyer Miller Group or its predecessors.Ms.  Robinson also serves as a Director of BlackRock, Inc., whichis required to file reports pursuant to the Exchange Act.

**Ms.  Seifert (56)** has been a Director of Revlon, Inc.since January  2006. Ms.  Seifert has been Chairman ofPinnacle Perspectives, LLC, a business consulting company, sinceJuly  2004. Ms.  Seifert served as Corporate Executive VicePresident – Personal Care of Kimberly-Clark Corporation(‘‘Kimberly-Clark’’) from 1999 until herretirement in June  2004. Ms.  Seifert joined Kimberly-Clark,a global health and hygiene company, in 1978 and, prior to herretirement, served in several marketing and management positions inconnection with Kimberly-Clark's domestic and internationalconsumer products businesses. Prior to joining Kimberly-Clark,Ms.  Seifert held management positions at The Procter & GambleCompany, Beatrice Foods, Inc. and Fort Howard Paper Company. She alsoserves on the Boards of Directors of the following companies which arerequired to file reports pursuant to the Exchange Act:Albertson's, Inc., Eli Lilly & Company, Appleton Papers Inc.and Paperweight Development Corp.

**Mr. Wolfe (66)** has beena Director of Revlon, Inc. since March  2004. Mr. Wolfe served asChairman and Chief Executive Officer of Hershey Foods Corporation(‘‘Hershey’’) from 1994 until his retirement inDecember  2001. Mr. Wolfe joined Hershey in 1967 and held variousexecutive positions, including President and Chief Operating Officer,before being appointed its Chairman and Chief Executive Officer. Mr.Wolfe is also a Director and Chairman of the audit committees of thefollowing companies which are required to file reports pursuant to theExchange Act: Adelphia Communications Corporation and Bausch & LombIncorporated. Since 2005, Mr. Wolfe has served as a member of the Boardof Trustees of various mutual funds managed by Fidelity Management& Research Company.

Executive Officers

Thefollowing table sets forth each of the executive officers of Revlon,Inc. as of December  31,  2005, except for Mr.  Kennedywho became an executive officer effective in early March2006:

|                   |  |                                                        |  |  |  |  |
|-------------------|--|--------------------------------------------------------|--|--|--|--|
| **Name**          |  | **Position**                                           |
| Jack L.Stahl      |  | President and Chief Executive Officer                  |
| Thomas E. McGuire |  | Executive Vice President and ChiefFinancial Officer    |
| David L. Kennedy  |  | Executive Vice President                               |
| Robert K.Kretzman |  | Executive Vice President, General Counsel andSecretary |
|                   |

The following sets forth the ages,positions held with Revlon, Inc. and selected biographical informationfor the executive officers of Revlon, Inc., in each case as ofDecember  31,  2005, except for Mr.  Stahl, whosebiographical information is included above with the other Directors ofRevlon, Inc.:

**Mr.  McGuire (51)** served as ExecutiveVice President and Chief Financial Officer of Revlon, Inc. and ofProducts Corporation from August  2003 through early March2006. In early March  2006, Mr.  McGuire rotated positionswith Mr.  Kennedy and became Executive Vice President andPresident of Revlon, Inc.'s and Products Corporation'sinternational operations. Mr.  McGuire was the Founder and ChiefExecutive Officer of Human Capital Formation, LLC from August2001 until August  2003. Mr.  McGuire was the Chief OperatingOfficer of Zyman Marketing Group from July  2000 until May2001. From March  1982 until June  2000, Mr.  McGuireheld various professional staff and senior financial executivepositions at Coca-Cola, including positions in its internationalbusinesses.

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**Mr.  Kennedy (59)** served asExecutive Vice President and President of Revlon, Inc.'s andProducts Corporation's international operations from June2002 until early March  2006. In early March  2006, Mr.Kennedy rotated positions with Mr.  McGuire and became ExecutiveVice President and Chief Financial Officer of Revlon, Inc. and ofProducts Corporation. From November  2001 until January2002, Mr.  Kennedy served as a financial consultant. From 1998until 2001, Mr.  Kennedy was Managing Director of Coca-Cola AmatilLimited, a publicly-traded company headquartered in Sydney, Australiaand listed on the Sydney Stock Exchange. Prior to 1998, Mr.Kennedy held several senior management and senior financial positionswith Coca-Cola and its divisions and affiliated companies, which hejoined in 1980, including various senior financial positionsresponsible for financial reporting, internal audit, budgeting andforecasting, as well as serving as General Manager of the Coca-Cola USAFountain Division from 1992 to 1997.

**Mr.  Kretzman(54)** has been Executive Vice President, Chief Legal Officer,General Counsel and Secretary of Revlon, Inc. and of ProductsCorporation since December  2003. Mr.  Kretzman served asSenior Vice President, General Counsel and Secretary of Revlon, Inc.and of Products Corporation from January  2000 untilDecember  2003. Prior to becoming General Counsel, Mr.Kretzman served as Senior Vice President, Deputy General Counsel andSecretary from March  1998 to January  2000, as VicePresident, Deputy General Counsel and Secretary from January  1997to March  1998, and as Vice President and Secretary fromSeptember  1992 to January  1997. Mr.  Kretzman joinedthe Company in 1988 as Senior Counsel responsible for mergers andacquisitions. Mr.  Kretzman has also served as the Company'sChief Compliance Officer since January  2000.

Compensationof Directors

Directors who currently are not receivingcompensation as officers or employees of Revlon, Inc. or any of itsaffiliates (‘‘Non-Employee Directors’’) arepaid an annual retainer fee of $35,000, payable in quarterlyinstallments, a fee of $1,000 for each meeting of the Board ofDirectors or any committee (other than the Audit Committee) thereofthat they attend and annual equity awards(‘‘Awards’’) under the Stock Plan pursuant to aformula. The Compensation Committee determines a maximum face value ofthe annual option grant each year for each Non-Employee Director (whichface value amount cannot exceed $100,000 in any given year and was setat $75,000 for each of 2004 and 2005), and the face value amount isdivided by the closing price on the NYSE of Revlon, Inc.'s Class ACommon Stock on the date of the grant to determine the number ofoptions to be granted to the Non-Employee Director. On March7,  2005, the Compensation Committee granted each of theNon-Employee Directors options to purchase 29,412 shares of Class ACommon Stock ($75,000 divided by $2.55, the per share closing marketprice on the NYSE of Revlon, Inc.'s Class A Common Stock on thegrant date), which options consist of non-qualified options having aterm of seven years, will become exercisable as to 25% of theAward under the Stock Plan on March  7,  2006, and thereafterbecome cumulatively exercisable in additional 25% increments oneach subsequent March  7th, and have an exercise price equal to$2.55, the per share closing market price on the NYSE of Revlon,Inc.'s Class A Common Stock on the grant date (the‘‘2005 Non-Employee Director Awards’’).

In recognition of their increased responsibilities that have arisenas a result of the passage of the Sarbanes-Oxley Act of 2002 andrevised SEC and NYSE rules, and based upon the advice of independentcompensation consultants, members of the Audit Committee are paid anannual Audit Committee retainer fee of $10,000, in addition to theaforementioned annual retainer fee for Board membership, and a permeeting fee of $1,500 for each meeting of the Audit Committee that theyattend and Non-Employee Directors who serve as chairman of the AuditCommittee, Nominating and Corporate Governance Committee andCompensation and Stock Plan Committee each receive an annual retainerfee of $10,000 per annum, in addition to any other retainer or meetingfees they receive.

Messrs. Bernikow and Landau are alsonon-employee members of the Board of Directors of Products Corporation,for which they are paid an annual retainer fee of $25,000 per annum anda meeting fee of $1,000 for each meeting of the Board of Directors ofProducts Corporation that they attend.

Consistent with thesummaries set forth above, the following chart shows all compensationpaid by Revlon, Inc. to the Non-Employee Directors during 2005,including Board of Directors and applicable 

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Board committee retainer and meeting fees.The chart does not show any compensation for Mses. Lee or Seifert, aseach became a member of Revlon, Inc.’s Board of Directorseffective January  1,  2006.

|                       |  |                                               |        |                                                                |  |       |        |        |  |   |         |        |  |  |
|-----------------------|--|-----------------------------------------------|--------|----------------------------------------------------------------|--|-------|--------|--------|--|---|---------|--------|--|--|
| Non-Employee Director |  | Total Board Retainer andCommittee MeetingFees |        | Grant Date Present Value of2005 Non-EmployeeDirectorAwards (a) |  | Total |
| AlanBernikow          |  | $                                             | 70,500 |                                                           |  | $     | 40,127 |   |  | $ | 110,627 |   |
| Paul J. Bohan         |  | $                                             | 64,500 |                                                           |  | $     | 40,127 |   |  | $ | 104,627 |   |
| Meyer Feldberg        |  | $                                             | 80,500 |                                                           |  | $     | 40,127 |   |  | $ | 120,627 |   |
| Edward J. Landau      |  | $                                             | 77,000 |                                                           |  | $     | 40,127 |   |  | $ | 117,127 |   |
| Linda Gosden Robinson |  | $                                             | 56,000 |                                                           |  | $     | 40,127 |   |  | $ | 96,127  |   |
| Kenneth L. Wolfe      |  | $                                             | 53,000 |                                                           |  | $     | 40,127 |   |  | $ | 93,127  |   |
|                       |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | GrantDate Present Values for the 2005 Non-Employee Director Awards werecalculated using the Black-Scholes option pricing model, using theMarch  7,  2005 grant date with respect to such Awards. Stockoption models require a prediction about the future movement of stockprice. The following assumptions were made for purposes of calculatingsuch Grant Date Present Values: (i) a risk-free interest rate of returnof 3.96%; (ii) expected stock price volatility of approximately61%, based upon the volatility of the stock price of Class ACommon Stock; (iii) a constant dividend rate of zero percent; and (iv)an estimated life of 4.75 years from the grant date. No adjustments tothe theoretical value were made to reflect the waiting period, if any,prior to vesting of the stock options or the transferability (orrestrictions related thereto) of the stock options. The real value ofthe options in the table depends upon the actual performance of Revlon,Inc.'s Class A Common Stock on the NYSE during the applicableperiod and upon exercise. |

Audit Committee and AuditCommittee Financial Expert

The Board of Directors of Revlon,Inc. maintains an Audit Committee in accordance with the applicable SECrules and the NYSE's listing standards. Revlon, Inc.'s Boardof Directors has determined that Revlon, Inc.'s Audit Committee,consisting of Alan S. Bernikow, Paul J. Bohan, Meyer Feldberg andEdward J. Landau, has at least one ‘‘audit committeefinancial expert.’’ The Board determined that Alan S.Bernikow, based upon his experience, training and education, qualifiesas an audit committee financial expert in that he has  (a) anunderstanding of generally accepted accounting principles(‘‘GAAP’’) and financial statements;  (b)the ability to assess the general application of GAAP in connectionwith accounting for estimates, accruals and reserves; (c) experiencepreparing, auditing, analyzing or evaluating financial statements thatpresent a breadth and level of complexity of accounting issues that aregenerally comparable to the breadth and complexity of issues that canreasonably be expected to be raised by the Company's financialstatements, as well as experience actively supervising one or morepersons engaged in such activities; (d) an understanding of internalcontrols and procedures for financial reporting; and (e) anunderstanding of audit committee functions. For certain biographicaldata concerning Mr.  Bernikow, see ‘‘— Directorsand Executive Officers of the Registrant.’’ The Boardfurther determined that Mr.  Bernikow and the other members of theAudit Committee are independent of management pursuant to applicableSEC rules and NYSE listing standards regarding the independence ofboard and audit committee members, including the independenceprinciples set forth in the Revlon, Inc. Board Guidelines for AssessingDirector Independence, which are posted on Revlon, Inc.'s websiteat www.revloninc.com.

Senior Financial Officer Code ofEthics

The Company has a written Code of Business Conduct (the‘‘Code of Business Conduct’’) that includes acode of ethics (the ‘‘Senior Financial Officer Code ofEthics’’) that applies to the Company's ChiefExecutive Officer and senior financial officers (including theCompany's Chief Financial Officer, Controller and personsperforming similar functions) (collectively, the ‘‘SeniorFinancial Officers’’). In addition to printable copies ofthe Code of Business Conduct and the Senior Financial Officer Code ofEthics being available on Revlon, Inc.'s website,www.revloninc.com, the Company will provide a copy of the SeniorFinancial Officer Code of Ethics, without charge, upon written requestto Robert K. Kretzman, Executive Vice President and Chief LegalOfficer, Revlon, Inc., 237 Park Avenue, New York NY, 10017. If theCompany changes the Senior Financial Officer Code of Ethics in anymaterial respect or waives any provision of the Senior FinancialOfficer Code of Ethics for any of its Senior Financial Officers, theCompany expects to provide the public with notice of any such change orwaiver by publishing an 

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appropriate description of such event onRevlon, Inc.'s website, www.revloninc.com, or by otherappropriate means as required or permitted under applicable rules ofthe Commission. The Company does not currently expect to make any suchwaivers.

Item 11.    Executive Compensation

Thefollowing table sets forth information for the years indicatedconcerning the compensation awarded to, earned by or paid to thepersons who served as Chief Executive Officer of the Company during2005 and the four most highly paid executive officers (see footnote (a)below), other than the Chief Executive Officer, who served as executiveofficers of the Company during 2005 (collectively, the‘‘Named Executive Officers’’), for servicesrendered in all capacities to the Company and its subsidiaries duringsuch periods.

Summary Compensation Table

|                                       |  |        |        |                        |  |                               |           |                             |  |                              |         |                             |  |                         |         |        |  |        |           |        |  |        |           |        |  |        |         |        |  |  |
|---------------------------------------|--|--------|--------|------------------------|--|-------------------------------|-----------|-----------------------------|--|------------------------------|---------|-----------------------------|--|-------------------------|---------|--------|--|--------|-----------|--------|--|--------|-----------|--------|--|--------|---------|--------|--|--|
|                                  |  |   |        | AnnualCompensation (a) |  | Long-Term Compensation Awards |           |                        |
| NameAnd Principal Position            |  | Year   |        | Salary ($)             |  | Bonus ($)                     |           | OtherAnnualCompensation ($) |  | RestrictedStockAwards($) (b) |         | SecuritiesUnderlyingOptions |  | AllOtherCompensation($) |
| Jack L.Stahl                          |  |   | 2005   |                   |  |                          | 1,300,000 |                        |  |                         | — |                        |  |                    | 80,634  |   |  |   | —   |   |  |   | —   |   |  |   | 158,505 |   |
| President and Chief                   |  |   | 2004   |                   |  |                          | 1,300,000 |                        |  |                         | 455,000 |                        |  |                    | 95,677  |   |  |   | 8,181,000 |   |  |   | 5,520,000 |   |  |   | 173,631 |   |
| Executive Officer (c)                 |  |   | 2003   |                   |  |                          | 1,300,000 |                        |  |                         | — |                        |  |                    | 103,244 |   |  |   | —   |   |  |   | 100,000   |   |  |   | 173,277 |   |
| Thomas E.McGuire                      |  |   | 2005   |                   |  |                          | 524,231   |                        |  |                         | 41,635  |                        |  |                    | 57,722  |   |  |   | —   |   |  |   | 130,000   |   |  |   | 97,116  |   |
| Executive Vice                        |  |   | 2004   |                   |  |                          | 500,000   |                        |  |                         | 735,000 |                        |  |                    | 88,973  |   |  |   | 590,850   |   |  |   | 995,000   |   |  |   | 128,631 |   |
|     President and |  |   | 2003   |                   |  |                          | 182,692   |                        |  |                         | — |                        |  |                    | 18,678  |   |  |   | 150,500   |   |  |   | 100,000   |   |  |   | 25,224  |   |
| Chief FinancialOfficer (d)            |  |   |   |                   |  |                          |      |                        |  |                         |    |                        |  |                    |    |   |  |   |      |   |  |   |      |   |  |   |    |   |
| Robert K.Kretzman                     |  |   | 2005   |                   |  |                          | 521,880   |                        |  |                         | 113,985 |                        |  |                    | 12,573  |   |  |   | —   |   |  |   | 120,000   |   |  |   | 11,902  |   |
| Executive Vice                        |  |   |   |                   |  |                          |      |                        |  |                         |    |                        |  |                    |    |   |  |   |      |   |  |   |      |   |  |   |    |   |
| President,Chief Legal                 |  |   |   |                   |  |                          |      |                        |  |                         |    |                        |  |                    |    |   |  |   |      |   |  |   |      |   |  |   |    |   |
| Officer, General                      |  |   |   |                   |  |                          |      |                        |  |                         |    |                        |  |                    |    |   |  |   |      |   |  |   |      |   |  |   |    |   |
| Counsel and Secretary (e)             |  |   |   |                   |  |                          |      |                        |  |                         |    |                        |  |                    |    |   |  |   |      |   |  |   |      |   |  |   |    |   |
|                                       |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | Theamounts shown in Annual Compensation for 2005, 2004 and 2003 reflectsalary, bonus and other annual compensation (including, as required tobe disclosed in accordance with Item 402 of Regulation S-K promulgatedunder the Exchange Act, perquisites and other personal benefits valuedin excess of $50,000) and amounts reimbursed for payment of taxesawarded to, earned by or paid to the persons listed for servicesrendered to the Company and its subsidiaries. For the periods reported,the Company had an executive bonus plan in which executivesparticipated (including Messrs. Stahl, McGuire and Kretzman) (see‘‘— Employment Agreements’’). Theexecutive bonus plan provided for payment of cash compensation upon theachievement of predetermined business and personal performanceobjectives during the calendar year that are established by theCompensation Committee, except that in respect of 2003, as a result ofthe non-attainment of bonus objectives for that year, the CompensationCommittee determined that no bonuses would be payable under theexecutive bonus plan or any other incentive compensation plan of theCompany for that year. In addition, no salary increases were providedin 2004 and the Company's bonus plan targets for 2004 and 2005were set at 50% and 75%, respectively, of the regularbonus targets. For 2005, the Company is reporting the compensation ofMessrs. Stahl, McGuire and Kretzman, its only executive officers during2005. |

|     |                                                                                                                                                                                                                                                                                                                                                                        |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | See footnotes(c), (d) and (e) below for information concerning the number, value andvesting schedules on restricted stock awards to the Named ExecutiveOfficers under the Stock Plan. The options granted to Named ExecutiveOfficers during 2005 pursuant to the Stock Plan are discussed belowunder ‘‘Option Grants in the Last FiscalYear.’’ |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | Mr.  Stahl became Presidentand Chief Executive Officer of the Company during February  2002.In March  2006, Mr.  Stahl was entitled to receive a bonus of$373,190, which he had earned in respect of 2005 pursuant to the termsof the executive bonus plan, and based upon the achievement of certainpredetermined, objective performance-based bonus criteria that had beenestablished in early 2005 by the Compensation Committee. Mr.Stahl waived receipt of such bonus to help fund, in part, discretionarybonuses to participants in the executive bonus plan in recognition ofthe Company’s significant achievements during 2005, includingthe launch of the Company’s new **Vital Radiance**brand andthe restage of **Almay**; securing an approximately 23%increase in shelf space commitments at U.S. retail customers; growth inthe U.S. market share for color |

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|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | cosmetics, hair color and beauty tools; thesuccessful refinancing of the Company’s debt which was scheduledto mature in 2006 and extending its term through 2011; and thedevelopment of a new fragrance for the Company’s re-entry intothe prestige distribution channel. The amount shown for Mr.  Stahlunder Other Annual Compensation for 2005 includes $80,634 in respect ofgross ups for taxes on imputed income arising out of (x) personal useof a Company-provided automobile, (y) premiums paid or reimbursed bythe Company in respect of life insurance and (z) reimbursements formortgage principal and interest payments pursuant to Mr.Stahl's employment agreement, as amended. In addition, althoughnot required to be disclosed in the Summary Compensation Table abovepursuant to Item 402 of Regulation S-K, Mr.  Stahl'scompensation for 2005 also included (i) $5,652 in respect of use of aCompany-provided automobile, (ii) $12,782 in reimbursements under theCompany's Executive Medical Plan, (iii) $39,014 in premiums paidby the Company in respect of supplemental long-term disabilityinsurance and (iv) $8,500 for tax preparation expenses in 2005. Theamount shown under All Other Compensation for 2005 reflects (i) $16,237in respect of life insurance premiums, (ii) $135,968 of additionalcompensation in respect of interest and principal payments on amortgage loan which Products Corporation made to Mr.  Stahl onMay  20,  2002 (prior to the passage of the Sarbanes-OxleyAct of 2002 and its prohibitions on loans to executive officers) topurchase a principal residence in the New York metropolitan areapursuant to his employment agreement (see ‘‘—Employment Agreements ‘‘) and (iii) $6,300 in respect ofmatching contributions under the 401(k) Plan. |

|  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--|--|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | In March  2005, Mr.  Stahl receiveda bonus of $455,000 in respect of 2004 pursuant to the terms of theexecutive bonus plan, and based upon the achievement of certainpredetermined, objective performance-based bonus criteria that had beenestablished in early 2004 by the Compensation Committee. The amountshown for Mr.  Stahl under Other Annual Compensation for 2004includes $95,677 in respect of gross ups for taxes on imputed incomearising out of (x) personal use of a Company-provided automobile, (y)premiums paid or reimbursed by the Company in respect of life insuranceand (z) reimbursements for mortgage principal and interest paymentspursuant to Mr.  Stahl's employment agreement, as amended. Inaddition, although not required to be disclosed in the SummaryCompensation Table above pursuant to Item 402 of Regulation S-K,Mr.  Stahl's compensation for 2004 also included (i) $21,188in respect of use of a Company-provided automobile, (ii) $11,886 inreimbursements under the Company's Executive Medical Plan, (iii)$28,028 in premiums paid by the Company in respect of supplementallong-term disability insurance and (iv) $8,500 for tax preparationexpenses in 2004. The amount shown under All Other Compensation for2004 reflects (i) $16,513 in respect of life insurance premiums, (ii)$135,968 of additional compensation in respect of interest andprincipal payments on a mortgage loan which Products Corporation madeto Mr.  Stahl on May  20,  2002 (prior to the passage ofthe Sarbanes-Oxley Act of 2002 and its prohibitions on loans toexecutive officers) to purchase a principal residence in the New Yorkmetropolitan area pursuant to his employment agreement (see‘‘— Employment Agreements ‘‘), (iii)$6,150 in respect of matching contributions under the 401(k) Plan and (iv) $15,000 in respect of matching contributions under theRevlon Excess Savings Plan for Key Employees. On April  14,2004, Mr.  Stahl was awarded a grant of 2,700,000 shares ofrestricted stock under the Stock Plan. One third of Mr.Stahl's 2004 restricted stock Award vested on April14,  2005 and, provided Mr.  Stahl remains continuouslyemployed by the Company, or if he is terminated by the Company without‘‘cause’’ or if he terminates his employmentfor ‘‘good reason’’ (as each such term isdescribed in Mr.  Stahl's employment agreement, as amended),his 2004 restricted stock Award will vest as to an additional one-thirdon each subsequent anniversary of the grant date. No dividends will bepaid on unvested restricted stock granted to Mr.  Stahl in 2004.The value of the restricted stock Awards granted to Mr.  Stahl onApril  14,  2004 as reflected in the table is based on the$3.03 per share closing market price of Revlon, Inc.'s Class ACommon Stock on the NYSE on the grant date, provided, however, onlyone-third of Mr.  Stahl's restricted stock Award had vestedas of December  31,  2005 and those vested shares were valuedat $2,727,000 on the same basis. The value of these restricted stockAwards as of December  31,  2005 was $8,370,000, based on aper share price of $3.10, the per share closing market price of Revlon,Inc.'s Class A Common Stock on the NYSE on December31,  2005, provided, however, because only one-third of Mr.Stahl's restricted stock Award had vested as of December31,  2005 those vested shares were valued at $2,790,000 on thesame basis. |

|  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|--|--|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | The amount shown forMr.  Stahl under Other Annual Compensation for 2003 includes$103,244 in respect of gross ups for taxes on imputed income arisingout of (i) personal use of a Company-provided automobile, (ii) premiumspaid or reimbursed by the Company in respect of life insurance and(iii) reimbursements for mortgage principal and interest paymentspursuant to Mr.  Stahl's employment agreement, as amended.The amount shown under All Other Compensation for 2003 reflects (i)$16,309 in respect of life insurance premiums, (ii) $135,968 ofadditional compensation in respect of interest and principal paymentson a mortgage loan which Products Corporation made to Mr.  Stahlon May  20,  2002 to purchase a principal residence in theNew York metropolitan area pursuant to his employment agreement (see‘‘— Employment Agreements’’), (iii)$6,000 in respect of matching contributions under the 401(k) Plan and (iv) $15,000 in respect of matching contributions under theRevlon Excess Savings Plan for Key Employees. |

|  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--|--|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | Mr.  Stahl's employment agreementwas amended on December  17,  2004 to extend the term forthree years and to provide that in the event that Mr.  Stahl isterminated without ‘‘cause’’ or if heterminates his employment for ‘‘good reason,’’the stock option awards granted to Mr.  Stahl on February17,  2002, May  19,  2003 and April  14,2004, and the restricted stock awards granted to Mr.  Stahl onFebruary  17,  2002 and April  14,  2004, shallcontinue to vest in accordance with their terms as if Mr.Stahl's employment had not been terminated and he had remainedemployed by the Company, and those stock option awards shall remainexercisable until the later of (i) one year after such existing optionaward becomes 100% fully vested and exercisable or (ii) 18months following Mr.  Stahl's termination of employment, butin no event beyond the original option term of each suchaward. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (d) | Mr.McGuire served as Executive Vice President and Chief Financial Officerof the Company from August  2003 until early March  2006. Inearly March  2006, Mr.  McGuire became Executive VicePresident and President of the Company's international operations.In March  2006, Mr.  McGuire will receive a bonus of $41,635in respect of 2005 pursuant to the terms of the executive bonus plan,and based upon the achievement of certain predetermined, objectiveperformance-based bonus criteria that had been established in early2005 by the Compensation Committee. The amount shown for Mr.McGuire under Other Annual Compensation for 2005 includes $57,722 inrespect of gross ups for taxes on imputed income arising out ofrelocation expenses paid or reimbursed by the Company in 2005. Inaddition, although not required to be disclosed in the SummaryCompensation Table above pursuant to Item 402 of Regulation S-K,Mr.  McGuire's compensation for 2005 also |

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|  |                                                                                                                                                                                                                                                                                                                                                                                                              |
|--|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | included $15,000 in respect of a cash carallowance. The amount shown under All Other Compensation for 2005reflects  (i) $88,078 in Company-paid expenses for temporarycorporate housing and travel to and from Atlanta pending his relocationto the New York metropolitan area, (ii) $6,300 in respect of matchingcontributions under the 401(k) Plan and (iii) $2,739 in respect of lifeinsurance premiums. |

|  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--|--|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | In March2005, Mr.  McGuire received a bonus of $135,000 in respect of 2004pursuant to the terms of the executive bonus plan, $70,875 of which wasbased upon the achievement of certain predetermined, objectiveperformance-based bonus criteria that had been established in early2004 by the Compensation Committee and $64,125 of which was adiscretionary bonus approved by the Compensation Committee inrecognition of, among other things, Mr.  McGuire'ssignificant contributions to the Company's refinancing activitiesduring 2004. In addition, pursuant to the terms of his employmentagreement, in January  2005 Mr.  McGuire received a $600,000retention incentive in respect of 2004, intended to assist him towardsfunding the purchase of a home in the New York metropolitan area (see‘‘— Employment Agreements’’). The amountshown for Mr.  McGuire under Other Annual Compensation for 2004includes $88,973 in respect of gross ups for taxes on imputed incomearising out of relocation expenses paid or reimbursed by the Company in2004. In addition, although not required to be disclosed in the SummaryCompensation Table above pursuant to Item 402 of Regulation S-K,Mr.  McGuire's compensation for 2004 also included $15,000 inrespect of a cash car allowance. The amount shown under All OtherCompensation for 2004 reflects (i) $119,835 in Company-paid expensesfor temporary corporate housing and travel to and from Atlanta pendinghis relocation to the New York metropolitan area and (ii) $2,546 inrespect of life insurance premiums. On April  14,  2004,Mr.  McGuire was awarded a grant of 195,000 shares of restrictedstock under the Stock Plan. One-third of Mr.  McGuire'srestricted stock Award vested on April  14,  2005 and,provided Mr.  McGuire remains continuously employed by theCompany, his 2004 restricted stock Award will vest as to an additionalone-third on each subsequent anniversary of the grant date. Nodividends will be paid on the unvested restricted stock granted toMr.  McGuire in 2004. The value of the restricted stock Awardsgranted to Mr.  McGuire on April  14,  2004 as reflectedin the table is based on the $3.03 per share closing market price ofRevlon, Inc.'s Class A Common Stock on the NYSE on that date,provided, however, only one-third of Mr.  McGuire'srestricted stock Award had vested as of December  31,  2005and those vested shares were valued at $196,950 on the same basis. Thevalue of these restricted stock Awards as of December  31,2005 was $604,500, based on a per share price of $3.10, the per shareclosing market price of Revlon, Inc.'s Class A Common Stock on theNYSE on December  31,  2005, provided, however, onlyone-third of Mr.  McGuire's restricted stock Award had vestedas of December  31,  2005 and those vested shares were valuedat $201,500 on the same basis. |

|  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--|--|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  |  | Theamount shown for Mr.  McGuire under Other Annual Compensation for2003 includes $18,678 in respect of gross ups for taxes on imputedincome arising out of relocation expenses paid or reimbursed by theCompany in 2003. The amount shown under All Other Compensation for 2003reflects (i) $24,732 in Company-paid relocation expenses and (ii) $492in respect of premiums under the Company’s basic life insuranceprogram. On August  18,  2003 (the ‘‘2003 McGuireGrant Date’’), Mr.  McGuire was awarded 50,000 sharesof restricted stock under the Stock Plan. Provided Mr.  McGuireremains continuously employed by the Company, his 2003 restricted stockAward will vest as to one-third of the restricted shares on the dayafter which the 20-day average of the closing price of Class A CommonStock on the NYSE equals or exceeds $20.00 per share, an additionalone-third of such restricted shares will vest on the day after whichsuch 20-day average closing price equals or exceeds $25.00 per shareand the balance will vest on the day after which such 20-day averageclosing price equals or exceeds $30.00 per share, provided (i) subjectto clause (ii) below, no portion of Mr.  McGuire's 2003restricted stock Award was to vest until the second anniversary of the2003 McGuire Grant Date,  (ii) all of the shares of restrictedstock awarded to Mr.  McGuire in 2003 will vest immediately in theevent of a ‘‘change in control’’ (as defined inMr.  McGuire's restricted stock agreement) and (iii) all ofthe shares of restricted stock granted to Mr.  McGuire in 2003that have not previously vested will fully vest on the thirdanniversary of the 2003 McGuire Grant Date. No dividends will be paidon the unvested restricted stock granted to Mr.  McGuire in 2003.The value of the restricted stock Awards granted to Mr.  McGuireon the 2003 McGuire Grant Date (none of the Award had vested as ofDecember  31,  2005) as reflected in the table is based onthe $3.01 per share closing market price of Revlon, Inc.'s Class ACommon Stock on the NYSE on the 2003 McGuire Grant Date. The value ofthese restricted stock Awards as of December  31,  2005 was$155,000, based on a per share price of $3.10, the per share closingmarket price of Revlon, Inc.'s Class A Common Stock on the NYSE onDecember  31,  2005. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (e) | Mr.  Kretzman,Executive  Vice  President,  Chief  LegalOfficer,  General  Counsel and Secretary of Revlon, Inc. andof Products Corporation, became an executive officer effective inMarch  2005. In March  2006, Mr.  Kretzman will receivea bonus of $113,985 in respect of 2005 pursuant to the terms of theexecutive bonus plan, and based upon the achievement of certainpredetermined, objective performance-based bonus criteria that had beenestablished in early 2005 by the Compensation Committee. The amountshown for Mr.  Kretzman under Other Annual Compensation for 2005includes $12,573 in respect of gross ups for taxes on imputed incomearising out of personal use of a Company-provided automobile. Inaddition, although not required to be disclosed in the SummaryCompensation Table above pursuant to Item 402 of Regulation S-K,Mr.  Kretzman's compensation for 2005 also included (i)$17,007 in respect of use of a Company-provided automobile, (ii)$12,782 in reimbursements under the Company's Executive MedicalPlan and  (iii) $1,000 for tax preparation expenses in 2005. Theamount shown under All Other Compensation for 2005 reflects  (i)$5,602 in respect of life insurance premiums and (ii) $6,300 in respectof matching contributions under the 401(k) Plan. |

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OPTION GRANTS IN THE LAST FISCALYEAR

During 2005, the following grants of stock options weremade pursuant to the Stock Plan to the Named Executive Officers:

|                    |  |                                                   |         |                                                           |  |                                 |  |                |         |                            |  |                                                         |  |        |         |        |  |  |  |  |  |  |
|--------------------|--|---------------------------------------------------|---------|-----------------------------------------------------------|--|---------------------------------|--|----------------|---------|----------------------------|--|---------------------------------------------------------|--|--------|---------|--------|--|--|--|--|--|--|
|               |  | Individual Grants                                 |         | Grant Date Value (a)                                      |
| Name               |  | Number of SecuritiesUnderlyingOptions Granted (#) |         | Percent of Total OptionsGranted toEmployees In FiscalYear |  | ExerciseorBase Price($/Sh)      |  | ExpirationDate |         | Grant DatePresent Value($) |
| JackL. Stahl       |  |                                              | — |                                                      |  |     — |  |           | — |                       |  |         — |  |   | — |   |
| Thomas E. McGuire  |  |                                              | 130,000 |                                                      |  | 2.50%                           |  | $              | 2.55    |                       |  | 3/7/2012                                                |  |   | 177,359 |   |
| Robert K. Kretzman |  |                                              | 120,000 |                                                      |  | 2.31%                           |  | $              | 2.55    |                       |  | 3/7/2012                                                |  |   | 163,716 |   |
|                    |

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|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | GrantDate Present Values were calculated using the Black-Scholes optionpricing model. The model used March  7,  2005 as a grant datewith respect to options granted to Messrs. McGuire and Kretzman on suchdate. Stock option models require a prediction about the futuremovement of stock price. The following assumptions were made forpurposes of calculating Grant Date Present Values: (i) a risk-freeinterest rate of return of 3.96%; (ii) expected stock pricevolatility of approximately 61%, based upon the volatility ofthe stock price of Class A Common Stock; (iii) a constant dividend rateof zero percent; and (iv) an estimated life of 4.75 years from thegrant date. No adjustments to the theoretical value were made toreflect the waiting period, if any, prior to vesting of the stockoptions or the transferability (or restrictions related thereto) of thestock options. The real value of the options in the table depends uponthe actual performance of Revlon, Inc.'s Class A Common Stock onthe NYSE during the applicable period and upon exercise. |

The options granted to Messrs. McGuire and Kretzman in 2005 underthe Stock Plan were awarded on March  7,  2005 and consist ofnon-qualified options having a term of seven years, vesting 25%on March  7,  2006 and continuing to vest in additional25% increments on each March  7th thereafter, becoming100% vested on March  7,  2009. These options have anexercise price equal to $2.55, the per share closing market price onthe NYSE of Revlon, Inc.'s Class A Common Stock on such grantdate, as indicated in the tableabove.

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AGGREGATED OPTIONEXERCISES IN LASTFISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

The following chart shows the number of stock options exercisedduring 2005 and the 2005 year-end value of the stock options held bythe Named Executive Officers:

|                    |  |                                     |         |                         |  |                                                                                                                     |         |                                                                                                   |  |                     |  |                            |  |  |  |  |  |  |
|--------------------|--|-------------------------------------|---------|-------------------------|--|---------------------------------------------------------------------------------------------------------------------|---------|---------------------------------------------------------------------------------------------------|--|---------------------|--|----------------------------|--|--|--|--|--|--|
| Name               |  | SharesAcquiredonExerciseDuring 2005 |         | ValueRealizedDuring2005 |  | Number ofSecuritiesUnderlying Unexercised Options at FiscalYear-EndExercisable/Unexercisableat December 31, 2005(#) |         | Value of In-The-MoneyOptions atFiscalYear-EndExercisable/Unexercisableat December 31, 2005(a) ($) |
| Jack L. Stahl      |  |                                | — |                    |  |                                                                                                                | — |                                                                                              |  | 2,810,000/3,210,000 |  | 193,700/193,700            |
| Thomas E. McGuire  |  |                                | — |                    |  |                                                                                                                | — |                                                                                              |  | 547,500/677,500     |  |   39,325/110,825 |
| Robert K. Kretzman |  |                                | — |                    |  |                                                                                                                | — |                                                                                              |  | 595,000/597,500     |  | 33,425/99,425              |
|                    |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | Amountsshown as value of in-the-money options represent the difference betweenthe exercise price of the options (exercisable or unexercisable, as thecase may be) and the market value of the underlying shares of Class ACommon Stock at year end, calculated using $3.10, the December31,  2005 closing market price on the NYSE of Revlon, Inc.'sClass A Common Stock. The actual value, if any, an executive mayrealize upon exercise of a stock option depends upon the amount bywhich the market price of shares of Class A Common Stock exceeds theexercise price per share when the stock options are exercised. |

Employment Agreements

Each of Messrs. Stahl, McGuire andKretzman has an executive employment agreement with ProductsCorporation.

Mr.  Stahl's employment agreement, asamended and extended (his ‘‘employmentagreement’’), provides that he will serve as President andChief Executive Officer at a base salary of not less than $1,300,000per annum, and that he receive a bonus of not less than $1,300,000 inrespect of 2002 (which bonus was paid in February  2003) andgrants of 1,000,000 shares of restricted stock and 400,000 options uponjoining the Company in 2002 (which grants were made on February17,  2002 (the ‘‘2002 Stahl GrantDate’’)). The term of Mr.  Stahl's employmentagreement ends on February  16,  2008, provided, however,that at any time on or after February  17,  2005, ProductsCorporation may terminate Mr.  Stahl's employment by 36months' prior written notice of non-renewal of the agreement.

Mr.  Stahl's employment agreement provides forparticipation in the executive bonus plan and other executive benefitplans on a basis equivalent to other senior executives of the Companygenerally. Mr.  Stahl's employment agreement provides forCompany-paid supplemental disability insurance and supplemental termlife insurance coverage with a death benefit of $10,000,000 duringemployment. The employment agreement for Mr.  Stahl also providesfor protection of Company confidential information and includes anon-compete obligation.

Mr.  Stahl's employmentagreement provides that in the event of termination of the term byMr.  Stahl for ‘‘good reason’’ (as definedin Mr.  Stahl's employment agreement), or by the Company(otherwise than for ‘‘cause’’ or‘‘disability’’ as each such term is defined ordescribed in Mr.  Stahl's employment agreement), Mr.Stahl would be entitled, at his election, to severance pursuant toProducts Corporation's Executive Severance Policy (see ‘‘— Executive Severance Policy’’)(other than the six-month limit on lump sum payments provided for insuch policy, which six-month limit provision would not apply toMr.  Stahl); or continued payments of base salary, continuedparticipation in the Company's life insurance plan (which lifeinsurance coverage is subject to a limit of two years) and medicalplans subject to the terms of such plans, and continued Company-paidsupplemental term life insurance, in each case through the dateoccurring 36 months after the date of notice of non-renewal, or in thecase of medical plan participation only, until such earlier date onwhich Mr.  Stahl were to become covered by like plans of anothercompany. In addition, Mr.  Stahl's employment agreementprovides that if he remains employed by Products Corporation or itsaffiliates until age 60, then upon any subsequent retirement he will beentitled to a supplemental pension benefit in a sufficient amount sothat his annual pension benefit from all qualified and non-qualifiedpension plans of Products Corporation and its affiliates, as well asany such plans of Mr.  Stahl's past employers or theiraffiliates (expressed as a straight life annuity), equals $500,000.

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If Mr.  Stahl's employment were toterminate on or after February  28,  2006 and prior toFebruary  28,  2007, then he would have received33.32% of the supplemental pension benefit otherwise payablepursuant to his employment agreement and thereafter an additional8.33% will accrue as of each February  28th on whichMr.  Stahl is still employed (but in no event more than would havebeen payable to Mr.  Stahl under the foregoing provision had heretired at age 60). Mr.  Stahl would not receive any supplementalpension benefit and any amounts then being paid for supplementalpension benefits would immediately cease if he were to materiallybreach his employment agreement or be terminated by the Company for‘‘cause’’ (as defined in Mr.  Stahl'semployment agreement). Mr.  Stahl's employment agreementprovides for continuation of group life insurance and executive medicalinsurance coverage in the event of permanent disability.

Mr.  Stahl's employment agreement provides that he wasentitled to a loan in March  2002 from Products Corporation tosatisfy state, local and federal income taxes (including anywithholding taxes) incurred by him as a result of his having made anelection under Section 83(b) of the Internal Revenue Code of 1986 (asamended, the ‘‘Code’’) in connection with the1,000,000 shares of restricted stock that were granted to him by theCompany on the 2002 Stahl Grant Date. Mr.  Stahl received suchloan from Products Corporation in the amount of $1,800,000 inMarch  2002, prior to the passage of the Sarbanes-Oxley Act of2002 and its prohibition on loans to executive officers. Interest onsuch loan is payable at the applicable federal rate. The full principalamount of such loan and all accrued interest is due and payable onFebruary  17,  2007 (the fifth anniversary of the 2002 StahlGrant Date), provided that if Mr.  Stahl terminates his employmentfor ‘‘good reason’’ or the Company terminateshim other than for ‘‘disability’’ or‘‘cause’’ (as each such term is defined ordescribed in Mr.  Stahl's employment agreement), theoutstanding balance of such loan and all accrued interest would beforgiven. Such loan is secured by a pledge of the 1,000,000 shares ofrestricted stock which were granted to Mr.  Stahl on the 2002Stahl Grant Date and such loan and pledge are evidenced by a PromissoryNote and a Pledge Agreement, each dated March  13,  2002.Mr.  Stahl's employment agreement also provides that he wasentitled to a mortgage loan to cover the purchase of a principalresidence in the New York metropolitan area and/or a Manhattanapartment, in the principal amount of $2,000,000, which loan wasadvanced by Products Corporation to Mr.  Stahl on May20,  2002, prior to the passage of the Sarbanes-Oxley Act of 2002.The principal of the mortgage loan is repayable on a monthly basisduring the period from June  1,  2002 through and includingMay  1,  2032, with interest at the applicable federal rate,with the unpaid principal and accrued and unpaid interest due in full90 days after Mr.  Stahl's employment with the Companyterminates, whichever occurs earlier. Pursuant to his employmentagreement, Mr.  Stahl is entitled to receive additionalcompensation payable on a monthly basis equal to the amount repaid byhim in respect of interest and principal on the mortgage loan, plus agross up for any taxes resulting from such additional compensation. Ifduring the term of his employment agreement Mr.  Stahl terminateshis employment for ‘‘good reason,’’ or theCompany terminates his employment other than for‘‘disability’’ or‘‘cause’’ (as each such term is defined ordescribed in Mr.  Stahl's employment agreement), the mortgageloan from the Company would be forgiven in its entirety.

Mr.  Stahl's employment agreement was amended onDecember  17,  2004 to extend the term of his agreement toFebruary  16,  2008 and to provide for continued vesting ofequity awards previously granted to Mr.  Stahl in the event thathe is terminated by the Company without‘‘cause’’ or if Mr.  Stahl terminates hisemployment for ‘‘good reason’’ (as each suchterm is defined or described in Mr.  Stahl's employmentagreement). Specifically, in the event that Mr.  Stahl isterminated without ‘‘cause’’ or if heterminated his employment for ‘‘good reason,’’the stock option awards granted to Mr.  Stahl on February17,  2002, May  19,  2003 and April  14,2004, and the restricted stock awards granted to Mr.  Stahl onFebruary  17,  2002 and April  14,  2004, wouldcontinue to vest in accordance with their terms as if Mr.Stahl's employment had not been terminated and he had remainedemployed by the Company, and those stock option awards shall remainexercisable until the later of (i) one year after such existing optionaward becomes 100% fully vested and exercisable or  (ii) 18months following Mr.  Stahl's termination of employment, butin no event beyond the original option term of each such award;provided, however, that as consideration for continued vesting of anyoption awards or restricted stock awards, as described above, thenon-solicitation and non-competition covenants in Mr.Stahl's employment agreement shall remain in effect at least untilthe date that all existing equity awards are fully vested.

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Mr.  McGuire's employmentagreement with Products Corporation, as amended (as so amended, his‘‘employment agreement’’), provides that hewill serve as Executive Vice President and Chief Financial Officerthrough early March  2006 and then as Executive Vice President andPresident of the Company's international operations, or such otherduties and responsibilities as may be assigned to him from time totime, at a base salary of not less than $500,000 per annum and that hereceive a (i) retention incentive of $600,000 (which was paid onJanuary  13,  2005) to assist him in purchasing a home in theNew York metropolitan area, and (ii) grant of (A) 50,000 shares ofrestricted stock in 2003 (which grant was made on the 2003 McGuireGrant Date), (B) 100,000 options in 2003 (which grant was made on the2003 McGuire Grant Date), (C) 25,000 options in 2004 (which grant wasmade on April  14,  2004) and (D) 25,000 options in 2005(which grant was made on March  7,  2005). ProductsCorporation may terminate Mr. McGuire's employment agreementeffective two years after written notice of non-extension of theagreement. During any period that his employment continues aftertermination or expiration of the term of his employment agreement,Mr.  McGuire would be deemed an employee at will and would beeligible for severance under Products Corporation's ExecutiveSeverance Policy (see ‘‘— Executive SeverancePolicy’’), provided that the Severance Period for Mr.McGuire shall not be less than 24 months.

Mr.McGuire's employment agreement provides for participation in theexecutive bonus plan with specific bonus targets. The employmentagreement for Mr.  McGuire also provides for protection of Companyconfidential information and includes a non-compete obligation.

Mr.  McGuire's employment agreement provides that in theevent of termination of the term by Mr.  McGuire for materialbreach by the Company of a material provision of such agreement orfailure of the Compensation Committee to adopt and implement therecommendations of management with respect to stock option orrestricted stock grants to be provided under his employment agreement,or by the Company (otherwise than for ‘‘cause’’as defined in Mr.  McGuire's employment agreement ordisability), Mr.  McGuire would be entitled, at his election, toseverance, including participation in the Company's medical plans,pursuant to the Executive Severance Policy (see ‘‘—Executive Severance Policy’’) (provided that the SeverancePeriod for Mr.  McGuire shall not be less than 24 months) orcontinued payments of base salary throughout the term and continuedparticipation in the Company's life insurance plan, which lifeinsurance coverage is subject to a limit of two years, and medicalplans, subject to the terms of such plans throughout the term or untilMr.  McGuire were covered by like plans of another company.

Mr.  McGuire's original employment agreement provided thatMr.  McGuire was eligible for certain relocation and retentionbenefits with the expectation that he would sell his home in Atlanta byAugust  18,  2004 and complete his relocation to New York byOctober  18,  2004. Due to the significant time thatMr.  McGuire spent on the Company's refinancing and debtreduction activities during 2004, which did not permit Mr.McGuire to pursue his relocation, the employment agreement was amendedin December  2004 to allow Mr.  McGuire until August18,  2005 to sell his home in Atlanta, until October18,  2005 to complete his relocation to the New York metropolitanarea and to extend the period that Products Corporation's wouldprovide him with reasonable corporate housing until December31,  2004.

Mr.  Kretzman's employment agreement(his ‘‘employment agreement’’) provides that hewill serve as Executive Vice President, Chief Legal Officer and GeneralCounsel at a base salary of not less than his current base salary,which for 2005 was $529,000. Products Corporation may terminateMr.  Kretzman's employment agreement effective two yearsafter written notice of non-extension of the agreement. During anyperiod that his employment continues after the termination orexpiration of the term of his employment agreement, Mr.  Kretzmanwould be deemed an employee at will and would be eligible for severanceunder Products Corporation's Executive Severance Policy (see‘‘— Executive Severance Policy’’),provided that the severance period for Mr.  Kretzman shall not beless than 24 months.

Mr.  Kretzman's employmentagreement provides for participation in the executive bonus plan andother executive benefit plans on a basis equivalent to other seniorexecutives of the Company generally. Mr.  Kretzman'semployment agreement provides for Company-paid supplemental term lifeinsurance coverage of two times Mr.  Kretzman's base salary.In addition, Mr.  Kretzman's employment agreement providesthat he is entitled to receive a retirement benefit at age 62,calculated under the Retirement Plan 

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and Pension Equalization Plan (each asdefined below), as if Mr.  Kretzman had elected retirement at age65. The employment agreement for Mr.  Kretzman also provides forprotection of Company confidential information and includes anon-compete obligation.

Mr.  Kretzman's agreementprovides that in the event of termination of the term of the employmentagreement by Mr.  Kretzman for breach by the Company of a materialprovision of his employment agreement, failure of the CompensationCommittee to adopt and implement the recommendations of management withrespect to stock option or restricted stock grants to be provided underhis employment agreement or for ‘‘good reason’’(as defined in Mr.  Kretzman's employment agreement), or bythe Company (otherwise than for ‘‘cause’’ asdefined in the employment agreement or for disability), Mr.Kretzman would be entitled, at his election, to severance and benefitscontinuation pursuant to the Executive Severance Policy (see‘‘— Executive Severance Policy’’)(provided that the Severance Period for Mr.  Kretzman shall not beless than 24 months) or continued payments of base salary throughoutthe term and continued participation in the Company's lifeinsurance plan, subject to a limit of two years, and medical plans,subject to the terms of such plans, throughout the term or untilMr.  Kretzman were covered by like plans of another company.Mr.  Kretzman's agreement provides for continued vesting ofeach of the stock option and restricted stock awards granted toMr.  Kretzman prior to November  1,  2002 in the eventthat he is terminated by the Company without‘‘cause’’ or if Mr.  Kretzman terminateshis employment agreement in accordance with its terms. Such awardswould continue to vest in accordance with their terms and remainexercisable until one year following the later of: (i) Mr.Kretzman's termination of employment or (ii) the date all suchawards became 100% fully vested and exercisable.

Executive Severance Policy

Products Corporation'sExecutive Severance Policy as in effect on December  31,2005 provides that upon termination of employment of eligible executiveemployees, including Messrs. Stahl, McGuire and Kretzman, other thanvoluntary resignation by the executive or termination by ProductsCorporation for ‘‘good reason,’’ inconsideration for the executive's execution of a release andconfidentiality agreement and the Company's standard employeenon-competition agreement, the eligible executive may be eligible toreceive, in lieu of severance under any employment agreement then ineffect or under Products Corporation's basic severance plan, anumber of months of severance pay in bi-weekly installments based uponsuch executive's grade level and years of service, reduced by theamount of any compensation from subsequent employment, unemploymentcompensation or statutory termination payments received by suchexecutive during the severance period and, in certain circumstances, bythe actuarial value of enhanced pension benefits received by theexecutive, as well as continued participation in medical and certainother benefit plans for the severance period (or in lieu thereof, uponcommencement of subsequent employment, a lump sum payment equal to thethen present value of 50% of the amount of base salary thenremaining payable through the balance of the severance period,generally capped at six months pay and subject to any restrictionsunder the Code). Pursuant to the Executive Severance Policy, uponmeeting the conditions set forth in such policy, as of December31,  2005, Messrs. Stahl, McGuire and Kretzman could be entitledto severance pay of up to 22, 20 and 24 months of base salary,respectively, at the base salary rate in effect on the date ofemployment termination, plus continued participation in the medical anddental plans for the same respective periods on the same terms asactive employees, provided that under each of Messrs. McGuire'sand Kretzman's employment agreements the severance period is atleast 24 months and under Mr.  Stahl's agreement he isentitled to 36 months' severance. Any compensation and benefits towhich Messrs. Stahl, McGuire or Kretzman would be eligible to receiveupon termination pursuant to the terms of their employment agreementsor the Executive Severance Policy would be subject to applicablerestrictions of the Code, if any, including, without limitation,Internal Revenue Code Section 409A and related regulations.

Defined Benefit Plans

In accordance with the terms of theRevlon Employees' Retirement Plan (the ‘‘RetirementPlan’’), the following table shows the estimated annualretirement benefits payable (as of December  31,  2005) underthe non-cash balance program of the Retirement Plan (the‘‘Non-Cash Balance Program’’) at normalretirement age (65) to a person retiring with the indicated averagecompensation and years of 

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credited service, on a straight life annuitybasis, after Social Security offset, including amounts attributable tothe Revlon Pension Equalization Plan, as amended (the‘‘Pension Equalization Plan’’), as describedbelow.

|                                                                          |  |                                                                                                             |         |        |  |        |         |        |  |        |         |        |  |        |         |        |  |        |         |        |  |  |
|--------------------------------------------------------------------------|--|-------------------------------------------------------------------------------------------------------------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--|
| Highest ConsecutiveFive-YearAverageCompensation DuringFinal 10 Years ($) |  | Estimated Annual Straight Life Annuity Benefits AtRetirementWith Indicated Years Of Credited Service ($)(a) |
| 15                                                                       |  | 20                                                                                                          |         | 25     |  | 30     |         | 35     |
| 600,000                                                                  |  |                                                                                                        | 150,183 |   |  |   | 200,244 |   |  |   | 250,305 |   |  |   | 300,366 |   |  |   | 300,366 |   |
| 700,000                                                                  |  |                                                                                                        | 176,183 |   |  |   | 234,911 |   |  |   | 293,638 |   |  |   | 352,366 |   |  |   | 352,366 |   |
| 800,000                                                                  |  |                                                                                                        | 202,183 |   |  |   | 269,577 |   |  |   | 336,972 |   |  |   | 404,366 |   |  |   | 404,366 |   |
| 900,000                                                                  |  |                                                                                                        | 228,183 |   |  |   | 304,244 |   |  |   | 380,305 |   |  |   | 456,366 |   |  |   | 456,366 |   |
| 1,000,000                                                                |  |                                                                                                        | 254,183 |   |  |   | 338,911 |   |  |   | 423,638 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 1,100,000                                                                |  |                                                                                                        | 280,183 |   |  |   | 373,577 |   |  |   | 466,972 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 1,200,000                                                                |  |                                                                                                        | 306,183 |   |  |   | 408,244 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 1,300,000                                                                |  |                                                                                                        | 332,183 |   |  |   | 442,911 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 1,400,000                                                                |  |                                                                                                        | 358,183 |   |  |   | 477,577 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 1,500,000                                                                |  |                                                                                                        | 384,183 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 2,000,000                                                                |  |                                                                                                        | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
| 2,500,000                                                                |  |                                                                                                        | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |  |   | 500,000 |   |
|                                                                          |

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|  |  |
|  |

|     |                                                                                                                |
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| (a) | Thenormal form of benefit for the Retirement Plan and the PensionEqualization Plan is a straight life annuity. |

TheRetirement Plan is intended to be a tax qualified defined benefit plan.Non-Cash Balance Program benefits are a function of service and finalaverage compensation. The Non-Cash Balance Program is designed toprovide an employee having 30 years of credited service with an annuitygenerally equal to 52% of final average compensation, less50% of estimated individual Social Security benefits. Finalaverage compensation is defined as average annual base salary and bonus(but not any part of bonuses in excess of 50% of base salary)during the five consecutive calendar years in which base salary andbonus (but not any part of bonuses in excess of 50% of basesalary) were highest out of the last 10 years prior to retirement orearlier termination. Except as otherwise indicated, credited serviceincludes all periods of employment with the Company or a subsidiaryprior to retirement or earlier termination. Messrs. Stahl and McGuiredo not participate in the Non-Cash Balance Program. The estimatedannual benefit payable under the Non-Cash Balance Program as a singlelife annuity (assuming such plan participant remains employed by theCompany until age 65 at his current level of compensation) is $303,700for Mr.  Kretzman.

Effective January  1,  2001,Products Corporation amended the Retirement Plan to provide for a cashbalance program under the Retirement Plan (the ‘‘CashBalance Program’’). Under the Cash Balance Program,eligible employees will receive quarterly credits to an individual cashbalance bookkeeping account equal to 5% of their compensationfor the previous quarter. Interest credits, which commenced June30,  2001, are allocated quarterly (based on the yield of the30-year Treasury bond for November of the preceding calendar year).Employees who as of January  1,  2001 were at least age 45,had 10 or more years of service with the Company and whose age andyears of service totaled at least 60, including Mr.  Kretzman,were ‘‘grandfathered’’ and continue toparticipate in the Non-Cash Balance Program under the same retirementformula described in the preceding paragraph. All other eligibleemployees had their benefits earned (if any) under the Non-Cash BalanceProgram ‘‘frozen’’ on December  31,2000 and began to participate in the Cash Balance Program onJanuary  1,  2001. The ‘‘frozen’’benefits will be payable at normal retirement age and will be reducedif the employee elects early retirement. Any employee who, as ofJanuary  1,  2001 was at least age 40 but not part of the‘‘grandfathered’’ group will, in addition tothe ‘‘basic’’ 5% quarterly pay credits,receive quarterly ‘‘transition’’ pay credits of3% of compensation each year for up to 10 years or until he/sheleaves employment with the Company, whichever is earlier. Messrs. Stahland McGuire participate in the Cash Balance Program. As they were notemployed by the Company on January  1,  2001 (the date onwhich a ‘‘transition’’ employee wasdetermined), Messrs. Stahl and McGuire are eligible to receive onlybasic pay credits. The estimated annual benefits payable under the CashBalance Program as a single life annuity (assuming Messrs. Stahl

66

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and McGuire remain employed by the Companyuntil age 65 at their current level of compensation) is $137,800 forMr.  Stahl and $57,500 for Mr.  McGuire. Mr.Stahl's total retirement benefits will be determined in accordancewith his employment agreement, which provides for a guaranteedretirement benefit provided that certain conditions are met.

TheEmployee Retirement Income Security Act of 1974, as amended, placescertain maximum limitations upon the annual benefit payable under allqualified plans of an employer to any one individual. In addition, theCode limits the annual amount of compensation that can be considered indetermining the level of benefits under qualified plans. The PensionEqualization Plan, as amended, is a non-qualified benefit arrangementdesigned to provide for the payment by the Company of the difference,if any, between the amount of such maximum limitations and the annualbenefit that would be payable under the Retirement Plan (including theNon-Cash Balance Program and the Cash Balance Program) but for suchlimitations, up to a combined maximum annual straight life annuitybenefit at age 65 under the Retirement Plan and the PensionEqualization Plan of $500,000. Benefits provided under the PensionEqualization Plan are conditioned on the participant's compliancewith his or her non-competition agreement and on the participant notcompeting with Products Corporation for one year after termination ofemployment.

The number of full years of service under theRetirement Plan and the Pension Equalization Plan as of January1,  2006 for Mr.  Stahl was three years, for Mr.McGuire was two years and for Mr.  Kretzman was 17years.

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|                |                                                                                              |
|----------------|----------------------------------------------------------------------------------------------|
| Item 12.  | SecurityOwnership of Certain Beneficial Owners and Management and RelatedStockholder Matters |

The following table sets forth, as ofJanuary  1,  2006, the number of shares of Revlon,Inc.'s Common Stock beneficially owned, and the percent so owned,by (i) each person known to the Company to be the beneficial owner ofmore than 5% of the outstanding shares of Revlon, Inc.'sCommon Stock, (ii) each director of Revlon, Inc., (iii) the ChiefExecutive Officer during 2005 and each of the other Named ExecutiveOfficers during 2005 and (iv) all directors and Named ExecutiveOfficers of Revlon, Inc. as a group. The number of shares owned arethose beneficially owned, as determined under the applicable rules ofthe SEC for the purposes of this Annual Report on Form 10-K, and suchinformation is not necessarily indicative of beneficial ownership forany other purpose. Under such rules, beneficial ownership includes anyshares of Common Stock as to which a person has sole or shared votingpower or investment power and any shares of Common Stock which theperson has the right to acquire within 60 days through the exercise ofany option, warrant or right, through conversion of any security orpursuant to the automatic termination of a power of attorney orrevocation of a trust, discretionary account or similar arrangement.Certain of the shares listed as beneficially owned are pursuant tostock options, which may be out of the money.

|                                                                   |  |                                           |  |                                                                      |  |  |  |  |  |  |
|-------------------------------------------------------------------|--|-------------------------------------------|--|----------------------------------------------------------------------|--|--|--|--|--|--|
| Nameand Address ofBeneficial Owner                                |  | Amountand Nature ofBeneficial Ownership   |  | Percentage ofClass                                                   |
| Ronald O. Perelman                                                |  | 191,685,641(Class A)                      |  | 59.74%(Class A and Class  B                                          |
| 35 E.62nd St.New York, NY 10021                                   |  | 31,250,000 (ClassB)(1)                    |  | combined)56.06% (ClassA)100.00% (Class B)                            |
| FMR Corp.                                                         |  | 57,900,499 (Class A)(2)                   |  | 15.58%(Class A and Class  B                                          |
| 82Devonshire StreetBoston MA 02109                                |  |                                      |  | combined)17.01% (Class A)                                            |
| Alan S. Bernikow                                                  |  | 14,780 (Class A)(3)                       |  | *                                                                    |
| PaulJ. Bohan                                                      |  | 11,030 (Class A)(4)                       |  | *                                                                    |
| Donald G. Drapkin                                                 |  | —                                   |  | *                                                                    |
| Meyer Feldberg                                                    |  | 31,655 (Class A)(5)                       |  | *                                                                    |
| Howard Gittis                                                     |  | 150,000 (Class A)                         |  | *                                                                    |
| Robert K. Kretzman                                                |  | 708,420 (ClassA)(6)                       |  | *                                                                    |
| Edward J. Landau                                                  |  | 31,789 (Class A)(7)                       |  | *                                                                    |
| DebraL. Lee                                                       |  | —                                   |  | *                                                                    |
| Thomas E.McGuire                                                  |  | 586,857 (Class A)(8)                      |  | *                                                                    |
| Linda Gosden Robinson                                             |  | 31,655 (ClassA)(9)                        |  | *                                                                    |
| Kathi P. Seifert                                                  |  | 34,000 (Class A)                          |  | *                                                                    |
| Jack L. Stahl                                                     |  | 4,424,416 (Class A)(10)                   |  | 1.18% (Class Aand Class Bcombined)1.29% (Class A)                    |
| Kenneth L. Wolfe                                                  |  | 26,030 (Class A)(11)                      |  | *                                                                    |
| All Directors and Named Executive Officers asa Group (14 Persons) |  | 197,736,273(Class A) 31,250,000 (Class B) |  | 60.69% (Class A and ClassBcombined)57.14% (Class A) 100.00% (ClassB) |
|                                                                   |

|  |
|--|
|  |  |
|  |

|   |                       |
|---|-----------------------|
| * | Lessthan one percent. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Mr.  Perelman beneficiallyowns, directly and indirectly, through MacAndrews & Forbes,191,685,641 shares of Class A Common Stock (including 32,599,374 sharesof Class A Common Stock beneficially owned by a family member, withrespect to which shares MacAndrews & Forbes holds a voting proxy,170,000 shares that represent restricted shares which have vested and1,525,000 shares that Mr.  Perelman may acquire under vestedoptions). Mr.  Perelman, through MacAndrews & Forbes, alsobeneficially owns all of the outstanding 31,250,000 shares of Revlon,Inc. Class B Common Stock, each of which is convertible into one shareof Class A Common Stock, which, together with the Class A Common Stockreferenced above, represent approximately 60% of the outstandingshares of Revlon, Inc. Common Stock and approximately 77% of thecombined voting power of such shares. Shares of Class A Common Stockand shares of intermediate holding companies between Revlon, Inc. andMacAndrews & Forbes are, and may from time to time be, pledged tosecure obligations of MacAndrews & Forbes. |

|     |                                                                                                                                                                                                                                          |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Information based solely on aSchedule 13G/A, dated and filed with the SEC on February14,  2006 and reporting, as of December  31,  2005,beneficial ownership by FMR Corp. and Edward C. Johnson 3d of57,900,499 shares of Class A Common |

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|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|--|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | Stock as of December  31,  2005(collectively, the ‘‘Fidelity Owned Shares’’).According to the Schedule 13G/A, Fidelity Management & ResearchCompany (‘‘FMRC’’), a wholly-owned subsidiaryof FMR Corp. and an investment advisor registered under Section 203 ofthe Investment Advisers Act of 1940, was the beneficial owner of40,632,108 shares of Class A Common Stock (which are included in theFidelity Owned Shares) as a result of acting as investment advisor tovarious investment companies registered under Section 8 of theInvestment Company Act of 1940. The ownership of one investmentcompany, Fidelity Advisors High Yield Fund, amounted to 35,212,984shares of Class A Common Stock (which are included in the 40,632,108shares referred to above). Edward C. Johnson 3d and FMR Corp., throughits control of FMRC, and the funds each has sole power to dispose ofthe 40,632,108 shares owned by the funds. Members of the family ofEdward C. Johnson 3d, Chairman of FMR Corp., are the predominantowners, directly or through trusts, of Series B shares of common stockof FMR Corp., representing 49% of the voting power of FMR Corp.The Johnson family group and all other Series B shareholders of FMRCorp. have entered into a shareholders' voting agreement underwhich all Series B shares of FMR Corp. will be voted in accordance withthe majority vote of Series B shares of FMR Corp. As a result of factsdescribed in the Schedule 13G/A, through their ownership of votingcommon stock and the execution of the shareholders' votingagreement, members of the Johnson family may be deemed, under theInvestment Company Act of 1940, to form a controlling group withrespect to FMR Corp. Neither FMR Corp. nor Edward C. Johnson 3d has thesole power to vote or direct the voting of the shares owned directly bythe Fidelity funds, which power resides with the funds' Boards ofTrustees. FMRC carries out the voting of the shares under writtenguidelines established by the funds' Boards of Trustees. FidelityManagement Trust Company (‘‘FMTC’’), awholly-owned subsidiary of FMR Corp. and a bank as defined in Section3(a)(6) of the Exchange Act, was the beneficial owner of 17,268,391shares of Class A Common Stock (which are included in the FidelityOwned Shares) as a result of its serving as investment manager of theinstitutional account(s). Edward C. Johnson 3d and FMR Corp., throughits control of FMTC, each has sole dispositive power over 17,268,391shares of Class A Common Stock and sole power to vote or to direct thevoting of 13,552,038 shares of Class A Common Stock (which are includedin the Fidelity Owned Shares), and no power to vote or to direct thevoting of 3,716,353 shares of Class A Common Stock owned by theinstitutional account(s) discussed above. FMRC, Fidelity Advisors HighYield Fund and FMTC share the same principal business address as FMRCorp. |

|     |                                                                           |
|-----|---------------------------------------------------------------------------|
| (3) | Includes 14,780shares that Mr.  Bernikow may acquire under vestedoptions. |

|     |                                                                        |
|-----|------------------------------------------------------------------------|
| (4) | Includes11,030 shares that Mr.  Bohan may acquire under vestedoptions. |

|     |                                                                           |
|-----|---------------------------------------------------------------------------|
| (5) | Includes31,655 shares that Mr.  Feldberg may acquire under vestedoptions. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (6) | Includes35,000 shares that represent restricted shares that vested during 2004,78,420 shares that represent restricted shares that vested during 2005and 595,000 shares that Mr.  Kretzman may acquire under vestedoptions (as set forth above in Item. 11, ‘‘ExecutiveCompensation – Aggregated Option Exercises in Last Fiscal Yearand Fiscal Year-End Option Values,’’ the value of Mr.Kretzman's exercisable in-the-money options at December31,  2005 was $33,425). |

|     |                                                                                                                     |
|-----|---------------------------------------------------------------------------------------------------------------------|
| (7) | Includes 134 shares helddirectly by Mr.  Landau and 31,655 shares that Mr.  Landaumay acquire under vested options. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (8) | Includes 39,357 shares thatrepresent restricted shares that vested during 2005 and 547,500 sharesthat Mr.  McGuire may acquire under vested options (as set forthabove in Item. 11, ‘‘Executive Compensation –Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-EndOption Values,’’ the value of Mr.  McGuire'sexercisable in-the-money options at December  31,  2005 was$39,325). |

|     |                                                                           |
|-----|---------------------------------------------------------------------------|
| (9) | Includes31,655 shares that Ms.  Robinson may acquire under vestedoptions. |

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (10) | Includes1,601,015 shares held directly by Mr.  Stahl (including 250,000shares that represent restricted shares that vested during 2004,900,000 shares that represent restricted shares that vested during 2005and 250,000 restricted shares that vested on February  17,2006), 13,401 shares held by Mr.  Stahl's wife, as to whichhe disclaims beneficial ownership, and 2,810,000 shares that Mr.Stahl may acquire under vested options (as set forth above in Item. 11,‘‘Executive Compensation — Aggregated OptionExercises in Last Fiscal Year and Fiscal Year-End OptionValues,’’ the value of Mr.  Stahl's exercisablein-the-money options at December  31,  2005 was$193,700). |

|      |                                                                                                                    |
|------|--------------------------------------------------------------------------------------------------------------------|
| (11) | Includes15,000 shares held directly by Mr. Wolfe and 11,030 shares that Mr.Wolfe may acquire under vested options. |

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EQUITY COMPENSATION PLAN INFORMATION

The following table sets forth as of December  31,  2005,with respect to all equity compensation plans of the Company previouslyapproved and not previously approved by its stockholders: (i) thenumber of securities to be issued upon the exercise of outstandingoptions, warrants and rights and the vesting of restricted stock, (ii)the weighted-average exercise price of such outstanding options,warrants and rights (which excludes restricted stock) and (iii) thenumber of securities remaining available for future issuance under suchequity compensation plans, excluding securities reflected in item (i).A description of the Supplemental Stock Plan follows the table.

Equity Compensation Plan Information

|                                            |  |                                                                                     |            |                                                                         |  |                                                                                                                                    |        |            |  |        |           |        |  |  |
|--------------------------------------------|--|-------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------|--|------------------------------------------------------------------------------------------------------------------------------------|--------|------------|--|--------|-----------|--------|--|--|
|                                       |  | (a)                                                                                 |            | (b)                                                                     |  | (c)                                                                                                                                |
| PlanCategory                               |  | Number ofsecurities tobeissued uponexercise ofoutstandingoptions,warrantsand rights |            | Weighted-averageexercise priceofoutstanding options,warrants and rights |  | Number ofsecuritiesremaining available forfuture issuanceunderequity compensationplans (excludingsecuritiesreflected incolumn (a)) |
| PreviouslyApproved by Stockholders:        |  |                                                                                |       |                                                                    |  |                                                                                                                               |   |       |  |   |      |   |
| StockPlan                                  |  |                                                                                | 36,445,599 | (1)                                                                |  | $                                                                                                                                  | 4.25   | (4)   |  |   | 1,927,811 |   |
| Not Previously Approved byStockholders:(2) |  |                                                                                |       |                                                                    |  |                                                                                                                               |   |       |  |   |      |   |
| SupplementalStock Plan                     |  |                                                                                | 397,500    | (3)                                                                |  |                                                                                                                               | N/A(3  | )(4)  |  |   | —   |   |
|                                            |

|  |
|--|
|  |  |
|  |

|     |                                                                                                 |
|-----|-------------------------------------------------------------------------------------------------|
| (1) | Includes3,412,502 shares of restricted stock and 33,033,097 options issuedunder the Stock Plan. |

|     |                                                                                                                                                                                    |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The Supplemental Stock Plan wasnot required to be approved by Revlon, Inc.'s stockholders underNYSE rules in effect in February  2002 when the Supplemental StockPlan was adopted. |

|     |                                                                                                                                                                                                                                |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3) | Includes 530,000 shares ofrestricted stock issued under the Supplemental Stock Plan, the entireamount of securities issuable under such plan, less 132,500 of suchshares as to which the restrictions lapsed on June  18,2004. |

|     |                                                           |
|-----|-----------------------------------------------------------|
| (4) | Weighted-averageexercise price excludes restricted stock. |

On February17,  2002, Revlon, Inc. adopted the Revlon, Inc. 2002 SupplementalStock Plan (the ‘‘Supplemental Stock Plan’’),the purpose of which was to provide Mr.  Stahl, the sole eligibleparticipant, with inducement awards to induce him to join the Companyand to enhance the Company's long-term performance andprofitability. The Supplemental Stock Plan covers 530,000 shares of theCompany's Class A Common Stock. Awards may be made under theSupplemental Stock Plan in the form of stock options, stockappreciation rights and restricted or unrestricted stock. OnFebruary  17,  2002, the Compensation Committee grantedMr.  Stahl an Award of 530,000 restricted shares of Class A CommonStock, the full amount of the shares of Class A Common Stock issuableunder the Supplemental Stock Plan. The terms of the Supplemental StockPlan and the foregoing grant of restricted shares to Mr.  Stahlare substantially the same as the Stock Plan and the grant ofrestricted shares to Mr.  Stahl under the Stock Plan. Pursuant tothe terms of the Supplemental Stock Plan, such grant was madeconditioned upon Mr.  Stahl's execution of the Company'sstandard employee confidentiality and non-competition agreement, whichcondition Mr.  Stahl fulfilled. See ‘‘—Employment Agreements’’ for information regarding vestingand forfeiture.

|                |                                               |
|----------------|-----------------------------------------------|
| Item 13.  | CertainRelationships And Related Transactions |

As of December31,  2005, MacAndrews & Forbes beneficially owned shares ofRevlon, Inc.'s Common Stock having approximately 77% of thecombined voting power of such outstanding shares. As a result,MacAndrews & Forbes is able to control the election of the entireBoard of Directors of Revlon, Inc. and control the vote on all matterssubmitted to a vote of Revlon, Inc.'s stockholders. MacAndrews& Forbes is wholly owned by Ronald O. Perelman, who is Chairman ofthe Board of Directors of Revlon, Inc.

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Transfer Agreements

InJune  1992, Revlon, Inc. and Products Corporation entered into anasset transfer agreement with Revlon Holdings LLC (a Delaware limitedliability company and formerly a Delaware corporation known as RevlonHoldings Inc. (‘‘Revlon Holdings’’) and whichis an affiliate and an indirect wholly-owned subsidiary of MacAndrews& Forbes Holdings) and certain of Revlon Holdings’wholly-owned subsidiaries. Revlon, Inc. and Products Corporation alsoentered into a real property asset transfer agreement with RevlonHoldings. Pursuant to such agreements, on June  24,  1992Revlon Holdings transferred assets to Products Corporation and ProductsCorporation assumed all of the liabilities of Revlon Holdings, otherthan certain specifically excluded assets and liabilities (theliabilities excluded are referred to as the ‘‘ExcludedLiabilities’’). Certain consumer products lines sold indemonstrator-assisted distribution channels considered not integral toRevlon, Inc.'s business, and that historically had not beenprofitable, and certain other assets and liabilities were retained byRevlon Holdings. Revlon Holdings agreed to indemnify Revlon, Inc. andProducts Corporation against losses arising from the ExcludedLiabilities, and Revlon, Inc. and Products Corporation agreed toindemnify Revlon Holdings against losses arising from the liabilitiesassumed by Products Corporation. The amount reimbursed by RevlonHoldings to Products Corporation for the Excluded Liabilities for 2005was $0.2  million.

Reimbursement Agreements

Revlon, Inc., Products Corporation and MacAndrews & Forbes Inc.(a wholly-owned subsidiary of MacAndrews & Forbes Holdings) haveentered into reimbursement agreements (the ‘‘ReimbursementAgreements’’) pursuant to which (i) MacAndrews & ForbesInc. is obligated to provide (directly or through affiliates) certainprofessional and administrative services, including employees, toRevlon, Inc. and its subsidiaries, including Products Corporation, andpurchase services from third party providers, such as insurance, legaland accounting services and air transportation services, on behalf ofRevlon, Inc. and its subsidiaries, including Products Corporation, tothe extent requested by Products Corporation, and (ii) ProductsCorporation is obligated to provide certain professional andadministrative services, including employees, to MacAndrews &Forbes and purchase services from third party providers, such asinsurance and legal and accounting services, on behalf of MacAndrews& Forbes to the extent requested by MacAndrews & Forbes Inc.,provided that in each case the performance of such services does notcause an unreasonable burden to MacAndrews & Forbes or ProductsCorporation, as the case may be. Products Corporation reimbursesMacAndrews & Forbes for the allocable costs of the servicespurchased for or provided to Products Corporation and its subsidiariesand for reasonable out-of-pocket expenses incurred in connection withthe provision of such services. MacAndrews & Forbes Inc. (or suchaffiliates) reimburses Products Corporation for the allocable costs ofthe services purchased for or provided to MacAndrews & Forbes andfor the reasonable out-of-pocket expenses incurred in connection withthe purchase or provision of such services. Each of Revlon, Inc. andProducts Corporation, on the one hand, and MacAndrews & ForbesInc., on the other, has agreed to indemnify the other party for lossesarising out of the provision of services by it under the ReimbursementAgreements other than losses resulting from its willful misconduct orgross negligence. The Reimbursement Agreements may be terminated byeither party on 90 days' notice. Products Corporation does notintend to request services under the Reimbursement Agreements unlesstheir costs would be at least as favorable to Products Corporation ascould be obtained from unaffiliated third parties. Revlon, Inc. andProducts Corporation participate in MacAndrews & Forbes'directors and officers liability insurance program, which coversRevlon, Inc. and Products Corporation as well as MacAndrews &Forbes. The limits of coverage are available on an aggregate basis forlosses to any or all of the participating companies and theirrespective directors and officers. Revlon, Inc. and ProductsCorporation reimburse MacAndrews & Forbes from time to time fortheir allocable portion of the premiums for such coverage, which theCompany believes is more favorable than the premiums the Company wouldpay were it to secure stand-alone coverage. The amounts paid by Revlon,Inc. and Products Corporation to MacAndrews & Forbes for premiumsis included in the amounts paid under the Reimbursement Agreements. Thenet amount payable to MacAndrews & Forbes Inc. for the servicesprovided under the Reimbursement Agreements for 2005 was $3.7million.

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Tax Sharing Agreements

As aresult of the closing of the Revlon Exchange Transactions, as of theend of March  25,  2004, Revlon, Inc., Products Corporationand their U.S. subsidiaries were no longer included in the MacAndrews& Forbes Group for federal income tax purposes. See Item 7.,‘‘Management's Discussion and Analysis of FinancialCondition and Results of Operations — Financial Condition,Liquidity and Capital Resources — Sources and Uses’’for further discussion on these agreements and related transactions in2005.

Registration Rights Agreement

Prior to theconsummation of Revlon, Inc.'s initial public equity offering inFebruary  1996, Revlon, Inc. and Revlon Worldwide Corporation(subsequently merged into REV Holdings), the then direct parent ofRevlon, Inc., entered into a registration rights agreement (the‘‘Registration Rights Agreement’’), and inFebruary  2003, MacAndrews & Forbes Inc. executed a joinderagreement to the Registration Rights Agreement, pursuant to which REVHoldings, MacAndrews & Forbes Inc. and certain transferees ofRevlon, Inc.'s Common Stock held by REV Holdings (the‘‘Holders’’) had the right to require Revlon,Inc. to register under the Securities Act all or part of the Class ACommon Stock owned by such Holders, including shares of Class A CommonStock purchased in connection with the $50.0  million equityrights offering consummated by Revlon, Inc. in 2003, and shares ofClass A Common Stock issuable upon conversion of Revlon, Inc.'sClass B Common Stock owned by such Holders (a ‘‘DemandRegistration’’); provided that Revlon, Inc. may postponegiving effect to a Demand Registration for a period of up to 30 days ifRevlon, Inc. believes such registration might have a material adverseeffect on any plan or proposal by Revlon, Inc. with respect to anyfinancing, acquisition, recapitalization, reorganization or othermaterial transaction, or if Revlon, Inc. is in possession of materialnon-public information that, if publicly disclosed, could result in amaterial disruption of a major corporate development or transactionthen pending or in progress or in other material adverse consequencesto Revlon, Inc. In addition, the Holders have the right to participatein registrations by Revlon, Inc. of its Class A Common Stock (a‘‘Piggyback Registration’’). The Holders willpay all out-of-pocket expenses incurred in connection with any DemandRegistration. Revlon, Inc. will pay any expenses incurred in connectionwith a Piggyback Registration, except for underwriting discounts,commissions and expenses attributable to the shares of Class A CommonStock sold by such Holders. In connection with the closing of theRevlon Exchange Transactions and pursuant to the 2004 InvestmentAgreement, MacAndrews & Forbes Inc. executed a joinder agreementthat provided that MacAndrews & Forbes Inc. would also be a Holderunder the Registration Rights Agreement and that all shares acquired byMacAndrews & Forbes Inc., pursuant to the Debt ReductionTransactions or the 2004 Investment Agreement, are deemed to beregistrable securities under the Registration Rights Agreement. Thiswould include any Class A Common Stock acquired by MacAndrews &Forbes in connection with Revlon, Inc.'s previously-announced$110  million rights offering, which it intends to conduct by theend of March  2006, and that would allow stockholders as of theFebruary  13,  2006 record date to purchase additional sharesof Class A Common Stock. See Item 1., ‘‘Business –Recent Developments’’.

2004 Consolidated MacAndrews& Forbes Line of Credit

For a description of transactionsin 2005 with MacAndrews & Forbes in connection with the 2004 loanagreements, see Item 7., ‘‘Management's Discussion andAnalysis of Financial Condition and Results of Operations —Financial Condition, Liquidity and Capital Resources — 2004Consolidated MacAndrews & Forbes Line of Credit.’’

2005 Refinancing Transactions

For a description oftransactions in 2005 with MacAndrews & Forbes in connection withthe Debt Reduction Transactions, the Revlon Exchange Transactions andthe 2004 Investment Agreement, see Item 7.,‘‘Management's Discussion and Analysis of FinancialCondition and Results of Operations — Financial Condition,Liquidity and Capital Resources — 2005 Refinancing Transactions,and — 2004 Refinancing Transactions.’’

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Other

Pursuant to a lease datedApril  2,  1993 (the ‘‘EdisonLease’’), Revlon Holdings leased to Products Corporationthe Edison research and development facility for a term of up to 10years with an annual rent of $1.4  million and certain sharedoperating expenses payable by Products Corporation which, together withthe annual rent, were not to exceed $2.0  million per year. InAugust  1998, Revlon Holdings sold the Edison facility to anunrelated third party, which assumed substantially all liability forenvironmental claims and compliance costs relating to the Edisonfacility, and in connection with the sale Products Corporationterminated the Edison Lease and entered into a new lease with the newowner. Revlon Holdings agreed to indemnify Products Corporation throughSeptember  1,  2013 (the term of the new lease) to the extentthat rent under the new lease exceeds rent that would have been payableunder the terminated Edison Lease had it not been terminated. The netamount reimbursed by Revlon Holdings to Products Corporation withrespect to the Edison facility for 2005 was $0.3  million.

During 2005, Products Corporation leased a small amount of space atcertain facilities to MacAndrews & Forbes or its affiliatespursuant to occupancy agreements and leases, including space atProducts Corporation's New York headquarters. The rent paid byMacAndrews & Forbes or its affiliates to Products Corporation for2005 was $0.2  million.

The 2004 Credit Agreement issupported by, among other things, guaranties from Revlon, Inc. and,subject to certain limited exceptions, all of the domestic subsidiariesof Products Corporation. The obligations under such guaranties aresecured by, among other things, the capital stock of ProductsCorporation and, subject to certain limited exceptions, the capitalstock of all of Products Corporation's domestic subsidiaries and66% of the capital stock of Products Corporation's and itsdomestic subsidiaries' first-tier foreign subsidiaries. Inconnection with the Revlon Exchange Transactions, on February11,  2004, Revlon, Inc. entered into supplemental indenturespursuant to which it agreed to guarantee the obligations of ProductsCorporation under the indentures governing Products Corporation's8 5/8% Senior Subordinated Notes and, prior totheir redemption in April  2005, Products Corporation's8 1/8% Senior Notes and 9% SeniorNotes.

In March  2002, prior to the passage of theSarbanes-Oxley Act of 2002, Products Corporation made an advance of$1.8  million to Mr.  Stahl pursuant to his employmentagreement, which was entered into in February  2002, for taxassistance related to a grant of restricted stock provided to Mr.Stahl pursuant to such agreement, which loan bears interest at theapplicable federal rate. In May  2002, prior to the passage of theSarbanes-Oxley Act of 2002, Products Corporation made an advance of$2.0  million to Mr.  Stahl pursuant to his employmentagreement in connection with the purchase of his principal residence inthe New York City metropolitan area, which loan bears interest at theapplicable federal rate. Mr.  Stahl repaid $147,299 of such loanduring 2005. Pursuant to his employment agreement, Mr.  Stahlreceives from Products Corporation additional compensation payable on amonthly basis equal to the amount actually paid by him in respect ofinterest and principal on such $2.0  million advance, which for2005 was $135,968. Products Corporation also pays Mr.  Stahl agross up for any taxes payable by Mr.  Stahl as a result of suchadditional compensation, which tax gross up amount was $68,999 in2005.

During 2005, Products Corporation made payments of$0.6  million to Ms.  Ellen  Barkin under a writtenagreement pursuant to which she provides voiceover services for certainof the Company's advertisements, which payments were competitivewith industry rates for similarly situated talent.

During 2005,Products Corporation paid $1.0  million to a nationally-recognizedsecurity services company, in which MacAndrews & Forbes has acontrolling interest, for security officer services. ProductsCorporation's decision to engage such firm was based upon itsexpertise in the field of security services, and the rates werecompetitive with industry rates for similarly situated securityfirms.

Although not required to be disclosed in this Item 13.‘‘Certain Relationships and Related PartyTransactions’’ pursuant to Item 404 of Regulation S-K,during 2005, Products Corporation obtained advertising, media anddirect marketing services from various subsidiaries of WPP in theordinary course of business. Ms.  Robinson, a member of Revlon,Inc.’s Board of Directors, is employed by one of WPP'ssubsidiaries, however, she is not an executive officer of WPP and hasno direct or indirect material interest in the business that theCompany conducts with WPP.

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|                |                                       |
|----------------|---------------------------------------|
| Item 14.  | PrincipalAccounting Fees and Services |

AUDIT FEES

The Board ofDirectors of Revlon, Inc. maintains an Audit Committee in accordancewith applicable SEC rules and the NYSE's listing standards. Inaccordance with the charter of Revlon, Inc.'s Audit Committee,which is available at www.revloninc.com, Revlon, Inc.'s AuditCommittee is directly responsible for the appointment, compensation,retention and oversight of the work of Revlon, Inc.'s independentauditors for the purpose of preparing and issuing its audit report orperforming other audit, review or attest services for Revlon, Inc. Theindependent auditors report directly to Revlon, Inc.'s AuditCommittee and Revlon, Inc.'s Audit Committee is directlyresponsible for, among other things, reviewing in advance, and grantingany appropriate pre-approvals of, (a) all auditing services to beprovided by the independent auditor and (b) all non-audit services tobe provided by the independent auditor (as permitted by the ExchangeAct), and in connection therewith to approve all fees and other termsof engagement, as required by the applicable rules of the Exchange Actand subject to the exemptions provided for in such rules. The AuditCommittee has an Audit Committee Pre-Approval Policy for pre-approvingall permissible audit and non-audit services performed by KPMG. In2004, the Audit Committee approved the Audit Committee Pre-ApprovalPolicy for 2005, and in October  2005, the Audit Committeeapproved the Audit Committee Pre-Approval Policy for 2006.

Theaggregate fees billed for professional services by KPMG in 2005 and2004 for these various services were (in millions):

|                    |  |        |         |        |  |        |         |        |  |  |
|--------------------|--|--------|---------|--------|--|--------|---------|--------|--|--|
| Typesof Fees       |  | 2005   |         | 2004   |
| Audit Fees         |  | $      | 4.6     |   |  | $      | 5.6     |   |
| Audit-Related Fees |  | $      | 0.5     |   |  | $      | 0.3     |   |
| Tax Fees           |  | $      | 0.3     |   |  | $      | 0.5     |   |
| AllOther Fees      |  |   | — |   |  |   | — |   |
| **Total Fees**     |  | $      | 5.4     |   |  | $      | 6.4     |   |
|                    |

In theabove table, in accordance with the SEC definitions and rules,‘‘audit fees’’ are fees the Company paid KPMGfor professional services rendered for the audits of (i) Revlon,Inc.'s and Products Corporation's annual financialstatements, (ii) management's assessment of the effectiveness ofthe Company’s internal control over financial reporting, (iii)the effectiveness of the Company’s internal control overfinancial reporting and (iv) the review of financial statementsincluded in Revlon, Inc.'s and Products Corporation'sQuarterly Reports on Form 10-Q, and for services that are normallyprovided by the auditor in connection with statutory and regulatoryfilings or engagements; ‘‘audit-related fees’’are fees billed by KPMG for assurance and related services that aretraditionally performed by the auditor, including services performed byKPMG related to employee benefit plan audits, the issuance by ProductsCorporation of its 91⁄2% Senior Notes in Marchand August  2005, the universal shelf registration statement filedby Revlon, Inc. with the SEC in 2005 and certain equity issuancesundertaken pursuant to such shelf registration, the Revlon ExchangeTransactions consummated in 2004 and attest services not required bystatute or regulation; ‘‘tax fees’’ are feesfor permissible tax compliance, tax advice and tax planning; and‘‘all other fees’’ are fees billed by KPMG tothe Company for any permissible services not included in the firstthree categories.

During 2005, the Audit Committee specificallypre-approved the services performed by KPMG in connection with (i)Revlon, Inc.'s and Products Corporation's 2005 audits, (ii)the issuance by Products Corporation of its91⁄2% Senior Notes in March and August2005 and (iii) the universal shelf registration statement filed byRevlon, Inc. with the SEC in 2005 and Revlon, Inc.’s planned$110  million rights offering being undertaken pursuant to suchshelf registration. During 2004, the Audit Committee specificallypre-approved the services performed by KPMG in connection with (i)Revlon, Inc.'s and Products Corporation's 2004 audit and(ii) the Debt Reduction Transactions consummated in 2004. All of theother services performed by KPMG for the Company during 2005 and 2004were either expressly pre-approved by the Audit Committee or werepre-approved in accordance with the Audit Committee's Pre-ApprovalPolicy and the Audit Committee was provided with regular updates as tothe nature of such services and fees paid for such services.

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Website Availability of Reports andOther Corporate Governance Information

The Company maintains acomprehensive corporate governance program, including CorporateGovernance Guidelines for Revlon, Inc.’s Board of Directors,Revlon, Inc.’s Board Guidelines for Assessing DirectorIndependence and charters for Revlon, Inc.’s Audit Committee,Nominating and Corporate Governance Committee and Compensation andStock Plan Committee. Revlon, Inc. maintains a corporate investorrelations website, www.revloninc.com, where stockholders and otherinterested persons may review, without charge, among other things,Revlon, Inc.'s corporate governance materials and certain SECfilings (such as Revlon, Inc.'s annual reports on Form 10-K,quarterly reports on Form 10-Q, current reports on Form 8-K, proxystatements, annual reports, Section 16 reports reflecting certainchanges in the stock ownership of Revlon, Inc.’s directors andSection 16 executive officers, and certain other documents filed withthe Commission), each of which are generally available on the samebusiness day as the filing date with the SEC on the SEC’swebsite http://www.sec.gov, as well as on the Company’s websitehttp://www.revloninc.com. In addition, under the section of the websiteentitled, ‘‘Corporate Governance,’’ Revlon,Inc. posts printable copies of the latest versions of its CorporateGovernance Guidelines, Board Guidelines for Assessing DirectorIndependence, charters for Revlon, Inc.'s Audit Committee,Nominating and Corporate Governance Committee and Compensation andStock Plan Committee, as well as Revlon, Inc.'s Code of BusinessConduct, which includes Revlon, Inc.'s Code of Ethics for SeniorFinancial Officers and the Audit Committee Pre-approval Policy, each ofwhich the Company will provide in print, without charge, upon writtenrequest to Robert K. Kretzman, Executive Vice President and Chief LegalOfficer, Revlon, Inc., 237 Park Avenue, New York, NY 10017. Thebusiness and financial materials and any other statement or disclosureon, or made available through, the Company's websites shall not beconsidered a ‘‘free writing prospectus’’ underthe SEC's Rule 405 of the Securities Act of 1933, as amended,unless specifically identified assuch.

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PART IV

|               |                                         |
|---------------|-----------------------------------------|
| Item15.  | Exhibits, Financial Statement Schedules |

|        |        |         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |  |
|--------|--------|---------|--|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|
|   | (a     | )  |  | List of documentsfiled as part of this Report:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |   |    |  | (1)  Consolidated Financial Statementsand Independent Auditors' Report included herein: See Index onpage F-1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   |   |    |  | (2)  FinancialStatement Schedule: See Index on page F-1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   |   |    |  |   All other schedules are omitted asthey are inapplicable or the required information is furnished in theConsolidated Financial Statements of the Company or the Notesthereto.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   |    |  | (3)  List ofExhibits:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|   | 3.     |    |  | Certificate ofIncorporation and By-laws.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   | 3.1    |    |  | Restated Certificate of Incorporation of Revlon, Inc., datedApril  30,  2004 (incorporated by reference to Exhibit 3.1 tothe Quarterly Report on Form 10-Q of Revlon, Inc. for the quarter endedMarch  31,  2004 filed with the Commission on May17,  2004 (the ‘‘Revlon, Inc. 2004 First Quarter10-Q’’)).                                                                                                                                                                                                                                                                                                                                                                                                                |
|   | 3.2    |    |  | Amended andRestated By-Laws of Revlon, Inc. dated as of March  22,  2004(incorporated by reference to Exhibit 3.2 to the Revlon, Inc. 2004First Quarter 10-Q).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   | 4.     |    |  | InstrumentsDefining the Rights of Security Holders, IncludingIndentures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   | 4.1    |    |  | Credit Agreement,dated as of July  9,  2004, among Products Corporation andcertain local borrowing subsidiaries, as borrowers, the lenders andissuing lenders party thereto, Citicorp USA, Inc., as term loanadministrative agent, Citicorp USA, Inc. as multi-currencyadministrative agent, Citicorp USA, Inc., as collateral agent, UBSSecurities LLC, as syndication agent, and Citigroup Global MarketsInc., as sole lead arranger and sole bookrunner (the ‘‘2004Credit Agreement’’) (incorporated by reference to Exhibit4.34 to the Current Report on Form 8-K of Products Corporation filedwith the Commission on July  13,  2004 (the‘‘Products Corporation July  13,  2004 Form8-K’’)). |
|   | 4.2    |    |  | First Amendmentdated February  15,  2006 to the 2004 Credit Agreement(incorporated by reference to Exhibit 10.2 to the Current Report onForm 8-K of Products Corporation filed with the Commission onFebruary  17,  2006 (the ‘‘Products CorporationFebruary  2006 Form 8-K’’)).                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   | 4.3    |    |  | Pledge and Security Agreement, dated as ofJuly  9,  2004, among Revlon, Inc., Products Corporation andthe additional grantors party thereto, in favor of Citicorp USA, Inc.,as collateral agent for the secured parties (incorporated by referenceto Exhibit 4.35 to the Products Corporation July  13,  2004Form 8-K).                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   | 4.4    |    |  | Intercreditor andCollateral Agency Agreement, dated as of July  9,  2004,among Citicorp USA, Inc., as administrative agent for themulti-currency lenders and issuing lenders, Citicorp USA, Inc., asadministrative agent for the term loan lenders, Citicorp USA, Inc., ascollateral agent for the secured parties, Revlon, Inc., ProductsCorporation and each other loan party (incorporated by reference toExhibit 4.36 to the Products Corporation July  13,  2004 Form8-K).                                                                                                                                                                                                                                                                   |
|        |

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|        |      |        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |  |
|--------|------|--------|--|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|
|   | 4.5  |   |  | Indenture, dated as ofFebruary  1,  1998, between Revlon Escrow and U.S. Bank TrustNational Association, as trustee, relating to the8 5/8% Senior Subordinated Notes due 2008 (asamended, the ‘‘8 5/8% SeniorSubordinated Notes Indenture’’) (incorporated by referenceto Exhibit 4.3 to the Registration Statement on Form S-1 of ProductsCorporation filed with the Commission on March  12,  1998,File No. 333-47875 (the ‘‘Products Corporation March1998 Form S-1’’)). |
|   | 4.6  |   |  | FirstSupplemental Indenture, dated March  4,  1998, among ProductsCorporation, Revlon Escrow, and U.S. Bank Trust National Association,as trustee, amending the 8 5/8% SeniorSubordinated Notes Indenture (incorporated by reference to Exhibit 4.4to the Products Corporation March  1998 Form S-1).                                                                                                                                                                                                                       |
|   | 4.7  |   |  | Second Supplemental Indenture, dated as ofFebruary  11,  2004, among Products Corporation, U.S. BankTrust National Association, as trustee, and Revlon, Inc. as guarantor,amending the 8 5/8% Senior Subordinated NotesIndenture (incorporated by reference to Exhibit 4.31 of the CurrentReport on Form 8-K of Revlon, Inc. filed with the Commission onFebruary  12,  2004 (the ‘‘Revlon, Inc.February  12,  2004 Form 8-K’’)).                                                                   |
|   | 4.8  |   |  | Indenture, dated as of March  16,2005, between Products Corporation and U.S. Bank National Association,as trustee, relating to Products Corporation's91⁄2% Senior Notes due 2011 (incorporated byreference to Exhibit 4.12 to the Annual Report on Form 10-K/A for theyear ended December  31,  2004 of Products Corporation (the‘‘2004 Products Corporation10-K/A’’)).                                                                                                                        |
|   | 4.9  |   |  | Stock PurchaseAgreement, dated February  17,  2006, between Revlon, Inc.and MacAndrews & Forbes Holdings (incorporated by reference toExhibit 10.1 to the Current Report on Form 8-K of Revlon, Inc. filedwith the Commission on February  17,  2006 (the‘‘Revlon, Inc. February  2006 Form8-K’’)).                                                                                                                                                                                             |
|   | 10.  |   |  | MaterialContracts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   | 10.1 |   |  | Tax SharingAgreement, dated as of June  24,  1992, among MacAndrews& Forbes Holdings, Revlon, Inc., Products Corporation and certainsubsidiaries of Products Corporation, as amended and restated as ofJanuary  1,  2001 (incorporated by reference to Exhibit 10.2to the Annual Report on Form 10-K of Products Corporation for thefiscal year ended December  31,  2001 filed with theCommission on February  25,  2002 (the ‘‘ProductsCorporation 2001 Form 10-K’’)).                        |
|   | 10.2 |   |  | Tax Sharing Agreement, dated as of March26,  2004, by and among Revlon, Inc., Products Corporation andcertain subsidiaries of Products Corporation (incorporated by referenceto Exhibit 10.25 to the Quarterly Report on Form 10-Q of ProductsCorporation for the quarter ended March  31,  2004 filed withthe Commission on May  17,  2004).                                                                                                                                                                               |
|   | 10.3 |   |  | Employment Agreement, dated as of February17,  2002, between Products Corporation and Jack L. Stahl (the‘‘Stahl Employment Agreement’’) (incorporatedby reference to Exhibit 10.17 to the Quarterly Report on Form 10-Q ofRevlon, Inc. for the quarter ended March  31,  2002 filedwith the Commission on May  15,  2002).                                                                                                                                                                          |
|   | 10.4 |   |  | First Amendment to the Stahl EmploymentAgreement, effective as of December  17,  2004 (incorporatedby reference to Exhibit 10.35 to the Current Report on Form 8-K ofRevlon, Inc. filed with the Commission on December  22,  2004(the ‘‘Revlon, Inc. December  22,  2004 Form8-K’’)).                                                                                                                                                                                                              |
|   | 10.5 |   |  | EmploymentAgreement, dated as of August  18,  2003, between ProductsCorporation and Thomas E. McGuire (the ‘‘McGuire EmploymentAgreement’’) (incorporated by reference to Exhibit 10.5 tothe Quarterly Report on Form 10-Q of Revlon, Inc. for the quarter endedSeptember  30,  2003 filed with the Commission onNovember  14,  2003).                                                                                                                                                              |
|        |

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|        |       |             |  |                                                                                                                                                                                                                                                                                                                                                                                                                   |  |  |
|--------|-------|-------------|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|
|   | 10.6  |        |  | Amendment to McGuireEmployment Agreement, dated as of December  17,  2004(incorporated by reference to Exhibit 10.36 to the Revlon, Inc.December  22,  2004 Form 8-K).                                                                                                                                                                                                                                            |
|   |       | *10.7  |  | Second Amendment to McGuire Employment Agreement, effective as ofMarch 2, 2006.                                                                                                                                                                                                                                                                                                                                   |
|   | 10.8  |        |  | Employment Agreement,dated as of June  10,  2002, between Products Corporation andDavid L. Kennedy (the ‘‘Kennedy EmploymentAgreement’’) (incorporated by reference to Exhibit 99.1 tothe Current Report on Form 8-K of Revlon, Inc. filed with theCommission on January  18,  2006).                                                                                                     |
|   |       | *10.9  |  | First Amendment to Kennedy EmploymentAgreement, effective March 2, 2006.                                                                                                                                                                                                                                                                                                                                          |
|   | 10.10 |        |  | Employment Agreement, dated as of November  1,  2002,between Products Corporation and Robert K. Kretzman (incorporated byreference to Exhibit 10.10 to the Annual Report on Form 10-K of Revlon,Inc. for the fiscal year ended December  31,  2004 filed withthe Commission on March  10,  2005 (the ‘‘Revlon,Inc. 2004 Form 10-K’’)).                                                    |
|   | 10.11 |        |  | Amended and Restated Revlon, Inc. Stock Plan (as amended the‘‘Stock Plan’’) (incorporated by reference toExhibit 4.1 to the Registration Statement on Form S-8 of Revlon, Inc.filed with the Commission on June  4,  2004, File No.333-116160).                                                                                                                                           |
|   | 10.12 |        |  | Current form ofNonqualified Stock Option Agreement under the Stock Plan (incorporatedby reference to Exhibit 10.12 to the Revlon, Inc. 2004 Form10-K).                                                                                                                                                                                                                                                            |
|   | 10.13 |        |  | Current form of RestrictedStock Agreement under the Stock Plan (incorporated by reference toExhibit 10.13 to the Revlon, Inc. 2004 Form 10-K).                                                                                                                                                                                                                                                                    |
|   | 10.14 |        |  | Revlon, Inc. 2002 Supplemental Stock Plan(incorporated by reference to Exhibit 4.1 to the Registration Statementon Form S-8 of Revlon, Inc. filed with the Commission on June24,  2002, File No. 333-91040).                                                                                                                                                                                                      |
|   | 10.15 |        |  | Revlon Executive Bonus Plan (incorporated by reference to Exhibit10.15 to the Quarterly Report on Form 10-Q of Products Corporation forthe quarter ended June  30,  2005 filed with the Commissionon August  9,  2005 (the ‘‘Products Corporation2005 Second Quarter Form 10-Q’’)).                                                                                                       |
|   | 10.16 |        |  | Amended and Restated Revlon PensionEqualization Plan, amended and restated as of December  14,1998 (incorporated by reference to Exhibit 10.15 to the Annual Reporton Form 10-K of Revlon, Inc. for year ended December  31,1998 filed with the Commission on March  3,1999).                                                                                                                                     |
|   | 10.17 |        |  | Executive SupplementalMedical Expense Plan Summary, dated July  2000 (incorporated byreference to Exhibit 10.10 to the Annual Report on Form 10-K of Revlon,Inc. for the year ended December  31,  2002 filed with theCommission on March  21,  2003 (the ‘‘Revlon,Inc. 2002 Form 10-K’’)).                                                                                               |
|   | 10.18 |        |  | Benefit Plans Assumption Agreement, dated as of July  1,1992, by and among Revlon Holdings, Revlon, Inc. and ProductsCorporation (incorporated by reference to Exhibit 10.25 to the AnnualReport on Form 10-K for the year ended December  31,  1992 ofProducts Corporation filed with the Commission on March  12,1993).                                                                                         |
|   | 10.19 |        |  | Revlon Executive SeverancePolicy, as amended July  1,  2002 (incorporated by referenceto Exhibit 10.13 to the Revlon, Inc. 2002 Form 10-K).                                                                                                                                                                                                                                                                       |
|   | 10.20 |        |  | 2004 Senior Unsecured Line of Credit Agreement,dated as of July  9,  2004, between Products Corporation andMacAndrews & Forbes (the ‘‘2004 Consolidated MacAndrews& Forbes Line of Credit’’) (incorporated by referenceto Exhibit 10.34 to the Quarterly Report on Form 10-Q of Revlon, Inc.for the quarter ended June  30,  2004 filed with theCommission on August  16,  2004). |
|        |

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|        |       |             |  |                                                                                                                                                                                                                                                                                                                         |  |  |
|--------|-------|-------------|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|
|   | 10.21 |        |  | First Amendment,dated as of August  4,  2005, to the 2004 ConsolidatedMacAndrews & Forbes Line of Credit (incorporated by reference toExhibit 10.33 to the Products Corporation 2005 Second Quarter Form10-Q).                                                                                                      |
|   | 10.22 |        |  | Second Amendment, dated as ofFebruary  17,  2006, to the 2004 Consolidated MacAndrews& Forbes Line of Credit (incorporated by reference to Exhibit 10.4to the Products Corporation February  2006 Form 8-K).                                                                                                        |
|   | 10.23 |        |  | Stockholders Agreement, dated as ofFebruary  20,  2004, by and between Revlon, Inc. and Fidelity(incorporated by reference to Exhibit 10.29 to the Current Report onForm 8-K of Revlon, Inc. filed with the Commission on February23,  2004 (the ‘‘Revlon, Inc. February  23,2004 Form 8-K’’)). |
|   | 10.24 |        |  | Investment Agreement, dated as of February  5,  2003,among Revlon, Inc., Products Corporation and MacAndrews & ForbesHoldings (incorporated by reference to Exhibit 2.1 to the CurrentReport on Form 8-K of Products Corporation filed with the Commission onFebruary  5,  2003).                                   |
|   | 10.25 |        |  | Investment Agreement, dated as of February  20,  2004, byand between Revlon, Inc. and MacAndrews & Forbes Holdings (asamended, the ‘‘2004 Investment Agreement’’)(incorporated by reference to Exhibit 10.30 of the Revlon, Inc.February  23,  2004 Form 8-K).                              |
|   | 10.26 |        |  | Amendment, dated as of March  24,  2004, to the 2004Investment Agreement (incorporated by reference to Exhibit 10.33 to theCurrent Report on Form 8-K of Revlon, Inc. filed with the Commission onMarch  26,  2004).                                                                                                    |
|   | 10.27 |        |  | SecondAmendment, dated as of March  7,  2005, to the 2004Investment Agreement (incorporated by reference to Exhibit 10.31 to theRevlon, Inc. 2004 Form 10-K).                                                                                                                                                           |
|   | 10.28 |        |  | ThirdAmendment, dated as of August  4,  2005, to the 2004Investment Agreement (incorporated by reference to Exhibit 10.34 to theQuarterly Report on Form 10-Q of Revlon, Inc. for the quarter endedJune 30, 2005 filed with the Commission on August 9, 2005).                                                          |
|   | 10.29 |        |  | Fourth Amendment, dated as of February17,  2006, to the 2004 Investment Agreement (incorporated byreference to Exhibit 10.3 to the Revlon, Inc. February  2006 Form8-K).                                                                                                                                                |
|   | 21.   |        |  | Subsidiaries.                                                                                                                                                                                                                                                                                                           |
|   |       | *21.1  |  | Subsidiaries of Revlon, Inc.                                                                                                                                                                                                                                                                                            |
|   | 23.   |        |  | Consents of Experts and Counsel.                                                                                                                                                                                                                                                                                        |
|   |       | *23.1  |  | Consent of KPMG LLP.                                                                                                                                                                                                                                                                                                    |
|   | 24.   |        |  | Powers of Attorney.                                                                                                                                                                                                                                                                                                     |
|   |       | *24.1  |  | Power of Attorney executed by Ronald O.Perelman.                                                                                                                                                                                                                                                                        |
|   |       | *24.2  |  | Power of Attorney executedby Howard Gittis.                                                                                                                                                                                                                                                                             |
|   |       | *24.3  |  | Power of Attorneyexecuted by Donald G. Drapkin.                                                                                                                                                                                                                                                                         |
|   |       | *24.4  |  | Powerof Attorney executed by Alan S. Bernikow.                                                                                                                                                                                                                                                                          |
|   |       | *24.5  |  | Power of Attorney executed by Paul J.Bohan.                                                                                                                                                                                                                                                                             |
|   |       | *24.6  |  | Power of Attorney executed byMeyer Feldberg.                                                                                                                                                                                                                                                                            |
|   |       | *24.7  |  | Power of Attorneyexecuted by Edward J. Landau.                                                                                                                                                                                                                                                                          |
|   |       | *24.8  |  | Powerof Attorney executed by Debra L. Lee.                                                                                                                                                                                                                                                                              |
|        |

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|        |      |                            |  |                                                                                                                                                                                          |  |  |
|--------|------|----------------------------|--|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|
|   |      | *24.9                 |  | Power of Attorneyexecuted by Linda Gosden Robinson.                                                                                                                                      |
|   |      | *24.10                |  | Power of Attorney executed by Kathi P. Seifert.                                                                                                                                          |
|   |      | *24.11                |  | Power of Attorney executed by Kenneth L.Wolfe.                                                                                                                                           |
|   |      | *31.1                 |  | Certification of Jack L.Stahl, Chief Executive Officer, dated March 2, 2006, pursuant to Rule13a-14(a)/15d-14(a) of the Exchange Act.                                                    |
|   |      | *31.2                 |  | Certification of Thomas E. McGuire, Chief Financial Officer, datedMarch 2, 2006, pursuant to Rule 13a-14(a)/15d-14(a) of the ExchangeAct.                                                |
|   | 32.1 | (furnished herewith)  |  | Certification of Jack L. Stahl, ChiefExecutive Officer, dated March 2, 2006, pursuant to 18 U.S.C. Section1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of2002.     |
|   | 32.2 | (furnished herewith)  |  | Certification of Thomas E. McGuire, ChiefFinancial Officer, dated March 2, 2006, pursuant to 18 U.S.C. Section1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of2002. |
|   |      | *99.1                 |  | Revlon, Inc. Audit CommitteePre-ApprovalPolicy.                                                                                                                                          |
|        |

|  |
|--|
|  |  |
|  |

|   |               |
|---|---------------|
| * | Filedherewith |

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REVLON,INC. AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTSAND SCHEDULE

|                                                                                                                                                   |  |        |        |        |  |  |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--|--------|--------|--------|--|--|
|                                                                                                                                              |  | Page   |
| Report of Independent Registered Public Accounting Firm(Consolidated Financial Statements)                                                        |  |   | F-2    |   |
| Report of Independent Registered Public Accounting Firm(Internal Control Over Financial Reporting)                                                |  |   | F-3    |   |
| **Audited FinancialStatements:**                                                                                                                  |  |   |   |   |
| Consolidated BalanceSheets as of December  31,  2005 and 2004                                                                                     |  |   | F-4    |   |
| Consolidated Statements of Operationsfor each of the years in the three-year period endedDecember  31,  2005                                      |  |   | F-5    |   |
| Consolidated Statements of Stockholders' Deficiencyand Comprehensive Loss for each of the years in the three-yearperiod ended December  31,  2005 |  |   | F-6    |   |
| Consolidated Statements of Cash Flows for each of theyears in the three-year period ended December  31,2005                                       |  |   | F-7    |   |
| Notes to ConsolidatedFinancial Statements                                                                                                         |  |   | F-8    |   |
| **Financial StatementSchedule:**                                                                                                                  |  |   |   |   |
| Schedule II —Valuation and Qualifying Accounts                                                                                              |  |   | F-48   |   |
|                                                                                                                                                   |

F-1

----

REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM

The Board of Directors andStockholders

Revlon, Inc.:

We haveaudited the accompanying consolidated balance sheets of Revlon, Inc.and subsidiaries as of December  31,  2005 and 2004, and therelated consolidated statements of operations, stockholders’deficiency and comprehensive loss, and cash flows for each of the yearsin the three-year period ended December  31,  2005. Inconnection with our audits of the consolidated financial statements, wealso have audited the financial statement schedule as listed on theindex on page F-1. These consolidated financial statements and thefinancial statement schedule are the responsibility of theCompany’s management. Our responsibility is to express anopinion on these consolidated financial statements and the financialstatement schedule based on our audits.

We conducted ouraudits in accordance with the standards of the Public CompanyAccounting Oversight Board (United States). Those standards requirethat we plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significantestimates made by management, as well as evaluating the overallfinancial statement presentation. We believe that our audits provide areasonable basis for our opinion.

In our opinion, theconsolidated financial statements referred to above present fairly, inall material respects, the financial position of Revlon, Inc. andsubsidiaries as of December  31,  2005 and 2004, and theresults of their operations and their cash flows for each of the yearsin the three-year period ended December  31,  2005, inconformity with U.S. generally accepted accounting principles. Also inour opinion, the related financial statement schedule, when consideredin relation to the basic consolidated financial statements taken as awhole, presents fairly, in all material respects, the information setforth therein.

We also have audited, in accordance withthe standards of the Public Company Accounting Oversight Board (UnitedStates), the effectiveness of Revlon, Inc. and subsidiaries’internal control over financial reporting as of December31,  2005, based on criteria established in Internal Control— Integrated Framework issued by the Committee of SponsoringOrganizations of the Treadway Commission (COSO), and our report datedMarch 1, 2006, expressed an unqualified opinion on management’sassessment of, and the effective operation of, internal control overfinancial reporting.

/s/ KPMG LLP

New York, New York

March 1,2006

F-2

----

REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM

The Board of Directors andStockholders

Revlon, Inc.:

We haveaudited management's assessment, included in the accompanyingManagement’s Annual Report on Internal Control over FinancialReporting in item 9A(b), that Revlon, Inc. maintained effectiveinternal control over financial reporting as of December31,  2005, based on criteria established in Internal Control— Integrated Framework issued by the Committee of SponsoringOrganizations of the Treadway Commission (COSO). Revlon,Inc.’s management is responsible for maintaining effectiveinternal control over financial reporting and for its assessment of theeffectiveness of internal control over financial reporting. Ourresponsibility is to express an opinion on management's assessmentand an opinion on the effectiveness of the Company’s internalcontrol over financial reporting based on our audit.

Weconducted our audit in accordance with the standards of the PublicCompany Accounting Oversight Board (United States). Those standardsrequire that we plan and perform the audit to obtain reasonableassurance about whether effective internal control over financialreporting was maintained in all material respects. Our audit includedobtaining an understanding of internal control over financialreporting, evaluating management's assessment, testing andevaluating the design and operating effectiveness of internal control,and performing such other procedures as we considered necessary in thecircumstances. We believe that our audit provides a reasonable basisfor our opinion.

A company's internal control overfinancial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company'sinternal control over financial reporting includes those policies andprocedures that (1) pertain to the maintenance of records that, inreasonable detail, accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generallyaccepted accounting principles, and that receipts and expenditures ofthe company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorizedacquisition, use, or disposition of the company’s assets thatcould have a material effect on the financial statements.

Because of its inherent limitations, internal control overfinancial reporting may not prevent or detect misstatements. Also,projections of any evaluation of effectiveness to future periods aresubject to the risk that controls may become inadequate because ofchanges in conditions, or that the degree of compliance with thepolicies or procedures may deteriorate.

In our opinion,management's assessment that Revlon, Inc. maintained effectiveinternal control over financial reporting as of December31,  2005, is fairly stated, in all material respects, based oncriteria established in Internal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the TreadwayCommission (COSO). Also, in our opinion, Revlon, Inc. maintained, inall material respects, effective internal control over financialreporting as of December  31,  2005, based on criteriaestablished in Internal Control — Integrated Framework issued bythe Committee of Sponsoring Organizations of the Treadway Commission(COSO).

We also have audited, in accordance with thestandards of the Public Company Accounting Oversight Board (UnitedStates), the consolidated balance sheets of Revlon, Inc. andsubsidiaries as of December  31,  2005 and 2004, and therelated consolidated statements of operations, stockholders’deficiency and comprehensive loss, and cash flows for each of the yearsin the three-year period ended December  31,  2005, and ourreport dated March 1, 2006 expressed an unqualified opinion on thoseconsolidated financial statements.

/s/ KPMGLLP

New York, New York

March1,  2006

F-3

----

REVLON,INC. AND SUBSIDIARIES

CONSOLIDATED BALANCESHEETS

(dollars in millions, except per shareamounts)

|                                                                                                                                                                             |  |                 |          |                  |  |        |          |         |  |  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|-----------------|----------|------------------|--|--------|----------|---------|--|--|
|                                                                                                                                                                        |  | December31,2005 |          | December 31,2004 |
| **ASSETS**                                                                                                                                                                  |  |            |     |             |  |   |     |    |
| Currentassets:                                                                                                                                                              |  |            |     |             |  |   |     |    |
| Cash and cashequivalents                                                                                                                                                    |  | $               | 32.5     |             |  | $      | 120.8    |    |
| Trade receivables, less allowances of $18.9 and $19.0 asof December  31,  2005 and 2004, respectively                                                                       |  |            | 282.2    |             |  |   | 200.6    |    |
| Inventories                                                                                                                                                                 |  |            | 220.6    |             |  |   | 154.7    |    |
| Prepaid expenses andother                                                                                                                                                   |  |            | 56.7     |             |  |   | 69.7     |    |
| Total current assets                                                                                                                                                        |  |            | 592.0    |             |  |   | 545.8    |    |
| Property, plant and equipment,net                                                                                                                                           |  |            | 119.7    |             |  |   | 118.7    |    |
| Otherassets                                                                                                                                                                 |  |            | 146.0    |             |  |   | 149.9    |    |
| Goodwill, net                                                                                                                                                               |  |            | 186.0    |             |  |   | 186.1    |    |
| Total assets                                                                                                                                                                |  | $               | 1,043.7  |             |  | $      | 1,000.5  |    |
| **LIABILITIESAND STOCKHOLDERS’DEFICIENCY**                                                                                                                            |  |            |     |             |  |   |     |    |
| Currentliabilities:                                                                                                                                                         |  |            |     |             |  |   |     |    |
| Short-term borrowings— third parties                                                                                                                                  |  | $               | 9.0      |             |  | $      | 36.6     |    |
| Current portion of long-term debt — thirdparties                                                                                                                      |  |            | —  |             |  |   | 10.5     |    |
| Accounts payable and outstanding checks                                                                                                                                     |  |            | 133.1    |             |  |   | 95.2     |    |
| Accrued expenses andother                                                                                                                                                   |  |            | 328.4    |             |  |   | 283.2    |    |
| Total current liabilities                                                                                                                                                   |  |            | 470.5    |             |  |   | 425.5    |    |
| Long-term debt — third parties                                                                                                                                        |  |            | 1,413.4  |             |  |   | 1,308.2  |    |
| Other long-termliabilities                                                                                                                                                  |  |            | 255.7    |             |  |   | 286.7    |    |
| Stockholders’deficiency:                                                                                                                                              |  |            |     |             |  |   |     |    |
| Class B ConvertibleCommon Stock, par value $0.01 per share; 200,000,000 shares authorized,31,250,000 issued and outstanding as of December  31,  2005and 2004, respectively |  |            | 0.3      |             |  |   | 0.3      |    |
| Class A Common Stock, par value $0.01 per share;900,000,000 shares authorized and 344,472,735 and 344,592,944 sharesissued as of December  31,  2005 and 2004, respectively |  |            | 3.4      |             |  |   | 3.4      |    |
| Additional paid-in capital                                                                                                                                                  |  |            | 771.3    |             |  |   | 771.4    |    |
| Treasury stock, atcost; 236,315 and 0 shares of Class A Common Stock as of December31,  2005 and 2004, respectively                                                         |  |            | (0.8     | )           |  |   | —  |    |
| Accumulated deficit                                                                                                                                                         |  |            | (1,741.9 | )           |  |   | (1,658.2 | )  |
| Deferredcompensation                                                                                                                                                        |  |            | (6.5     | )           |  |   | (12.5    | )  |
| Accumulated other comprehensive loss                                                                                                                                        |  |            | (121.7   | )           |  |   | (124.3   | )  |
| Total stockholders’ deficiency                                                                                                                                        |  |            | (1,095.9 | )           |  |   | (1,019.9 | )  |
| Total liabilities and stockholders’deficiency                                                                                                                         |  | $               | 1,043.7  |             |  | $      | 1,000.5  |    |
|                                                                                                                                                                             |

See Accompanying Notes toConsolidated Financial Statements

F-4

----

REVLON, INC. ANDSUBSIDIARIES

CONSOLIDATED STATEMENTS OFOPERATIONS

(dollars in millions, except per shareamounts)

|                                                                   |  |                        |             |         |  |        |             |         |  |        |            |         |  |  |
|-------------------------------------------------------------------|--|------------------------|-------------|---------|--|--------|-------------|---------|--|--------|------------|---------|--|--|
|                                                              |  | YearEnded December 31, |
|                                                              |  | 2005                   |             | 2004    |  | 2003   |
| Net sales                                                         |  | $                      | 1,332.3     |    |  | $      | 1,297.2     |    |  | $      | 1,299.3    |    |
| Cost of sales                                                     |  |                   | 508.1       |    |  |   | 485.3       |    |  |   | 501.1      |    |
| Gross profit                                                      |  |                   | 824.2       |    |  |   | 811.9       |    |  |   | 798.2      |    |
| Selling, general and administrativeexpenses                       |  |                   | 757.8       |    |  |   | 717.6       |    |  |   | 770.9      |    |
| Restructuring costs and other, net                                |  |                   | 1.5         |    |  |   | 5.8         |    |  |   | 6.0        |    |
| Operating income                                                  |  |                   | 64.9        |    |  |   | 88.5        |    |  |   | 21.3       |    |
| Other expenses(income):                                           |  |                   |        |    |  |   |        |    |  |   |       |    |
| Interest expense                                                  |  |                   | 130.0       |    |  |   | 130.8       |    |  |   | 174.5      |    |
| Interest income                                                   |  |                   | (5.8        | )  |  |   | (4.8        | )  |  |   | (4.3       | )  |
| Amortization of debt issuancecosts                                |  |                   | 6.9         |    |  |   | 8.2         |    |  |   | 8.9        |    |
| Foreign currency (gains) losses, net                              |  |                   | 0.5         |    |  |   | (5.2        | )  |  |   | (5.0       | )  |
| Loss on earlyextinguishment of debt                               |  |                   | 9.0         |    |  |   | 90.7        |    |  |   | —    |    |
| Miscellaneous, net                                                |  |                   | (0.5        | )  |  |   | 2.0         |    |  |   | 0.5        |    |
| Other expenses, net                                               |  |                   | 140.1       |    |  |   | 221.7       |    |  |   | 174.6      |    |
| Loss before income taxes                                          |  |                   | (75.2       | )  |  |   | (133.2      | )  |  |   | (153.3     | )  |
| Provision for income taxes                                        |  |                   | 8.5         |    |  |   | 9.3         |    |  |   | 0.5        |    |
| Net loss                                                          |  | $                      | (83.7       | )  |  | $      | (142.5      | )  |  | $      | (153.8     | )  |
| Basic and dilutedloss per common share: Net loss per common share |  | $                      | (0.23       | )  |  | $      | (0.47       | )  |  | $      | (2.47      | )  |
| Weighted average number ofcommon sharesoutstanding:               |  |                   |        |    |  |   |        |    |  |   |       |    |
| Basic anddiluted                                                  |  |                   | 371,132,302 |    |  |   | 301,053,334 |    |  |   | 62,327,726 |    |
|                                                                   |

SeeAccompanying Notes to Consolidated FinancialStatements

F-5

----

REVLON, INC. ANDSUBSIDIARIES

CONSOLIDATED STATEMENTS OFSTOCKHOLDERS’ DEFICIENCY AND COMPREHENSIVELOSS

(dollars in millions)

|                                                                                    |  |                |                          |             |  |                                              |                          |               |  |                    |                          |                      |  |                                   |                          |                                    |  |        |                          |         |  |        |                          |         |  |        |                          |         |  |        |          |         |  |  |
|------------------------------------------------------------------------------------|--|----------------|--------------------------|-------------|--|----------------------------------------------|--------------------------|---------------|--|--------------------|--------------------------|----------------------|--|-----------------------------------|--------------------------|------------------------------------|--|--------|--------------------------|---------|--|--------|--------------------------|---------|--|--------|--------------------------|---------|--|--------|----------|---------|--|--|
|                                                                               |  | PreferredStock |                          | CommonStock |  | AdditionalPaid-In-Capital(CapitalDeficiency) |                          | TreasuryStock |  | AccumulatedDeficit |                          | DeferredCompensation |  | AccumulatedOtherComprehensiveLoss |                          | TotalStockholders’Deficiency |
| Balance, January  1,  2003                                                         |  | $              | 54.6                     |        |  | $                                            | 0.5                      |          |  | $                  | (192.6                   | )               |  | $                                 | —                  |                               |  | $      | (1,361.9                 | )  |  | $      | (6.4                     | )  |  | $      | (132.7                   | )  |  | $      | (1,638.5 | )  |
| Net proceeds from 2003 Rights Offering (See Note 9)                                |  |           |                     |        |  |                                         | 0.2                      |          |  |               | 46.7                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | 46.9     |    |
| Reduction of liabilities assumed from indirectparent                               |  |           |                     |        |  |                                         |                     |          |  |               | 6.9                      | (a)             |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | 6.9      |    |
| Amortization ofdeferred compensation                                               |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   | 2.2                      |    |  |   |                     |    |  |   | 2.2      |    |
| Comprehensiveloss:                                                                 |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   |     |    |
| Netloss                                                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   | (153.8                   | )  |  |   |                     |    |  |   |                     |    |  |   | (153.8   | )  |
| Adjustment for minimumpension liability                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | 1.5                      |    |  |   | 1.5      |    |
| Revaluation of foreign currencyforward exchange contracts                          |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | (1.4                     | )  |  |   | (1.4     | )  |
| Currency translation adjustment                                                    |  |           |      |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   | 10.6                     |    |  |   | 10.6     |    |
| Total comprehensive loss                                                           |  |           |      |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   |      |    |  |   | (143.1   | )  |
| Balance, December  31,2003                                                         |  |           | 54.6                     |        |  |                                         | 0.7                      |          |  |               | (139.0                   | )               |  |                              | —                  |                               |  |   | (1,515.7                 | )  |  |   | (4.2                     | )  |  |   | (122.0                   | )  |  |   | (1,725.6 | )  |
| Common stock issued in exchangefor debt, accrued interest and preferred stock  (b) |  |           | (54.6                    | )      |  |                                         | 3.0                      |          |  |               | 879.3                    |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | 827.7    |    |
| Reduction ofliabilities assumed from indirect parent                               |  |           |                     |        |  |                                         |                     |          |  |               | 16.4                     | (a)             |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | 16.4     |    |
| Stock-basedcompensation                                                            |  |           |                     |        |  |                                         |                     |          |  |               | 14.7                     |                 |  |                              |                     |                               |  |   |                     |    |  |   | (14.7                    | )  |  |   |                     |    |  |   | —  |    |
| Amortization of deferredcompensation                                               |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   | 6.4                      |    |  |   |                     |    |  |   | 6.4      |    |
| Comprehensiveloss:                                                                 |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   |     |    |
| Netloss                                                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   | (142.5                   | )  |  |   |                     |    |  |   |                     |    |  |   | (142.5   | )  |
| Adjustment for minimumpension liability                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | (1.6                     | )  |  |   | (1.6     | )  |
| Revaluation of foreign currencyforward exchange contracts                          |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | (1.3                     | )  |  |   | (1.3     | )  |
| Currency translation adjustment                                                    |  |           |      |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   | 0.6                      |    |  |   | 0.6      |    |
| Total comprehensive loss                                                           |  |           |      |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   |      |    |  |   | (144.8   | )  |
| Balance, December  31,2004                                                         |  |           | —                  |        |  |                                         | 3.7                      |          |  |               | 771.4                    |                 |  |                              | —                  |                               |  |   | (1,658.2                 | )  |  |   | (12.5                    | )  |  |   | (124.3                   | )  |  |   | (1,019.9 | )  |
| Treasury stock acquired, atcost  (c)                                               |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              | (0.8                     | )                             |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | (0.8     | )  |
| Stock-basedcompensation                                                            |  |           |                     |        |  |                                         |                     |          |  |               | (0.2                     | )               |  |                              |                     |                               |  |   |                     |    |  |   | 0.2                      |    |  |   |                     |    |  |   | —  |    |
| Exercise of stock optionsfor common stock                                          |  |           |                     |        |  |                                         |                     |          |  |               | 0.1                      |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   | 0.1      |    |
| Amortization ofdeferred compensation                                               |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   | 5.8                      |    |  |   |                     |    |  |   | 5.8      |    |
| Comprehensiveloss:                                                                 |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   |                     |    |  |   |     |    |
| Netloss                                                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   | (83.7                    | )  |  |   |                     |    |  |   |                     |    |  |   | (83.7    | )  |
| Adjustment for minimumpension liability                                            |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | 6.7                      |    |  |   | 6.7      |    |
| Revaluation of foreign currencyforward exchange contracts                          |  |           |                     |        |  |                                         |                     |          |  |               |                     |                 |  |                              |                     |                               |  |   |                     |    |  |   |                     |    |  |   | 2.4                      |    |  |   | 2.4      |    |
| Currency translation adjustment                                                    |  |           |      |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   | (6.5                     | )  |  |   | (6.5     | )  |
| Total comprehensive loss                                                           |  |           |                     |        |  |                                         |      |          |  |               |      |                 |  |                              |      |                               |  |   |      |    |  |   |      |    |  |   |      |    |  |   | (81.1    | )  |
| Balance, December  31,2005                                                         |  | $              | —                  |        |  | $                                            | 3.7                      |          |  | $                  | 771.3                    |                 |  | $                                 | (0.8                     | )                             |  | $      | (1,741.9                 | )  |  | $      | (6.5                     | )  |  | $      | (121.7                   | )  |  | $      | (1,095.9 | )  |
|                                                                                    |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | During2003, the Company resolved various tax audits, which resulted in a taxbenefit of $13.9 of which $6.9 was recorded directly to capitaldeficiency since it relates to liabilities assumed by Revlon ConsumerProducts Corporation in connection with the transfer agreements relatedto Revlon Consumer Products Corporation's formation in 1992.During 2004, the Company resolved various state and federal tax auditsand determined that certain tax liabilities assumed by Revlon ConsumerProducts Corporation in connection with transfer agreements related toRevlon Consumer Products Corporation's formation in 1992 were nolonger probable. As a result, $16.4 was recorded directly to capitaldeficiency. (See Note 16, ‘‘Related PartyTransactions’’). |

|     |                                                                                                                                                                                                                                                                |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | The changes in Preferred Stock,Common Stock, Additional Paid-in-Capital (Capital Deficiency) and aportion of Accumulated Deficit are a result of the consummation of theRevlon Exchange Transactions. (See Note 9, ‘‘Long-TermDebt’’). |

|     |                                                                                                                                                                                                                                                                                   |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | Amount relates to 236,315 sharesof Revlon, Inc. Class A common stock received from certain executivesto satisfy the minimum statutory tax withholding requirements relatedto the vesting of shares of restricted stock. (See Note 13,‘‘Treasury Stock’’). |

SeeAccompanying Notes to Consolidated FinancialStatements

F-6

----

REVLON, INC. ANDSUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASHFLOWS

(dollars in millions)

|                                                                                           |  |             |         |         |  |        |         |         |  |        |         |         |  |  |
|-------------------------------------------------------------------------------------------|--|-------------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                                                                      |  | December31, |
|                                                                                      |  | 2005        |         | 2004    |  | 2003   |
| **CASH FLOWS FROMOPERATING ACTIVITIES:**                                                  |  |        |    |    |  |   |    |    |  |   |    |    |
| Net loss                                                                                  |  | $           | (83.7   | )  |  | $      | (142.5  | )  |  | $      | (153.8  | )  |
| Adjustments to reconcile net loss to net cash usedin operatingactivities:                 |  |        |    |    |  |   |    |    |  |   |    |    |
| Depreciation andamortization                                                              |  |        | 102.9   |    |  |   | 106.1   |    |  |   | 107.6   |    |
| Amortization of debt discount                                                             |  |        | 0.2     |    |  |   | 1.8     |    |  |   | 3.1     |    |
| Stock compensationamortization                                                            |  |        | 5.8     |    |  |   | 6.4     |    |  |   | 2.2     |    |
| Loss on early extinguishment of debt                                                      |  |        | 9.0     |    |  |   | 77.3    |    |  |   | — |    |
| Change inassets andliabilities:                                                           |  |        |    |    |  |   |    |    |  |   |    |    |
| (Increase)decrease in trade receivables                                                   |  |        | (86.5   | )  |  |   | (12.1   | )  |  |   | 40.2    |    |
| Increase in inventories                                                                   |  |        | (69.8   | )  |  |   | (7.8    | )  |  |   | (5.7    | )  |
| (Increase) decrease in prepaid expenses and othercurrent assets                           |  |        | 2.6     |    |  |   | (22.3   | )  |  |   | 2.9     |    |
| Increase (decrease) in accounts payable                                                   |  |        | 22.0    |    |  |   | (4.4    | )  |  |   | 0.5     |    |
| Increase(decrease) in accrued expenses and other current liabilities                      |  |        | 12.9    |    |  |   | (60.3   | )  |  |   | (109.8  | )  |
| Purchase of permanent displays                                                            |  |        | (69.6   | )  |  |   | (56.0   | )  |  |   | (72.9   | )  |
| Other, net                                                                                |  |        | 14.5    |    |  |   | 19.6    |    |  |   | 19.3    |    |
| Net cash used in operating activities                                                     |  |        | (139.7  | )  |  |   | (94.2   | )  |  |   | (166.4  | )  |
| **CASH FLOWS FROM INVESTINGACTIVITIES:**                                                  |  |        |    |    |  |   |    |    |  |   |    |    |
| Capitalexpenditures                                                                       |  |        | (25.8   | )  |  |   | (18.9   | )  |  |   | (28.6   | )  |
| Investment in debt defeasance trust                                                       |  |        | (197.9  | )  |  |   | — |    |  |   | — |    |
| Liquidation ofinvestment in debt defeasance trust                                         |  |        | 197.9   |    |  |   | — |    |  |   | — |    |
| Payment received onnote from parent                                                       |  |        | 10.0    |    |  |   | — |    |  |   | — |    |
| Proceeds from the sale of brand andcertain assets                                         |  |        | — |    |  |   | — |    |  |   | 5.3     |    |
| Net cash used in investingactivities                                                      |  |        | (15.8   | )  |  |   | (18.9   | )  |  |   | (23.3   | )  |
| **CASH FLOWS FROM FINANCINGACTIVITIES:**                                                  |  |        |    |    |  |   |    |    |  |   |    |    |
| Net increase(decrease) in short-term borrowings and overdraft — thirdparties        |  |        | (8.8    | )  |  |   | 6.0     |    |  |   | (1.6    | )  |
| Proceeds from the issuance of long-term debt — thirdparties                         |  |        | 386.2   |    |  |   | 1,136.2 |    |  |   | 233.1   |    |
| Repayment of long-term debt — third parties, includingprepayment fee and premiums   |  |        | (297.9  | )  |  |   | (960.2  | )  |  |   | (239.3  | )  |
| Proceeds from the issuance of long-termdebt — affiliates                            |  |        | — |    |  |   | 42.4    |    |  |   | 178.1   |    |
| Repayment of long-term debt —affiliates                                             |  |        | — |    |  |   | (19.5   | )  |  |   | (62.6   | )  |
| Net Proceeds from the 2003 Rights Offering                                                |  |        | — |    |  |   | — |    |  |   | 46.9    |    |
| Issuanceof Series C preferred stock                                                       |  |        | — |    |  |   | — |    |  |   | 50.0    |    |
| Redemption of Series C preferredstock                                                     |  |        | — |    |  |   | — |    |  |   | (50.0   | )  |
| Proceeds from the exercise of stock options for commonstock                               |  |        | 0.1     |    |  |   | — |    |  |   | — |    |
| Payment of financing costs                                                                |  |        | (12.0   | )  |  |   | (30.4   | )  |  |   | (3.5    | )  |
| Net cash provided by financingactivities                                                  |  |        | 67.6    |    |  |   | 174.5   |    |  |   | 151.1   |    |
| Effect of exchange rate changes on cashand cash equivalents                               |  |        | (0.4    | )  |  |   | 2.9     |    |  |   | 9.3     |    |
| Net (decrease) increasein cash and cash equivalents                                       |  |        | (88.3   | )  |  |   | 64.3    |    |  |   | (29.3   | )  |
| Cash and cash equivalents atbeginning of period                                           |  |        | 120.8   |    |  |   | 56.5    |    |  |   | 85.8    |    |
| Cash and cashequivalents at end of period                                                 |  | $           | 32.5    |    |  | $      | 120.8   |    |  | $      | 56.5    |    |
| Supplementalschedule of cash flowinformation:                                             |  |        |    |    |  |   |    |    |  |   |    |    |
| Cashpaid during the periodfor:                                                            |  |        |    |    |  |   |    |    |  |   |    |    |
| Interest                                                                                  |  | $           | 123.5   |    |  | $      | 133.9   |    |  | $      | 160.8   |    |
| Income taxes, net of refunds                                                              |  | $           | 17.9    |    |  | $      | 11.1    |    |  | $      | 6.7     |    |
| Supplementalschedule of non-cash investing and financingactivities:                       |  |        |    |    |  |   |    |    |  |   |    |    |
| Conversion oflong-term debt and accrued interest into Class A Common Stock                |  | $           | — |    |  | $      | 813.8   |    |  | $      | — |    |
| Exchange and conversion of Series A and Series B PreferredStock into Class A Common Stock |  | $           | — |    |  | $      | 54.6    |    |  | $      | — |    |
| Treasury stock receivedto satisfy tax withholding liabilities                             |  | $           | 0.8     |    |  | $      | — |    |  | $      | — |    |
| Reduction ofliabilities assumed from indirect parent                                      |  | $           | — |    |  | $      | 16.4    |    |  | $      | 6.9     |    |
|                                                                                           |

See AccompanyingNotes to Consolidated FinancialStatements

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REVLON,INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIALSTATEMENTS(all tabular amounts in millions, except per shareamounts)

1.    SUMMARY OF SIGNIFICANTACCOUNTING POLICIES

Principles of Consolidation andBasis of Presentation:

Revlon, Inc. (and together with itssubsidiaries, the ‘‘Company’’) conducts itsbusiness exclusively through its direct subsidiary, Revlon ConsumerProducts Corporation and its subsidiaries (‘‘ProductsCorporation’’). The Company manufactures and sells anextensive array of cosmetics, skincare, fragrances, beauty tools andpersonal care products. The Company's principal customers includelarge mass volume retailers and chain drug stores, as well as certaindepartment stores and other specialty stores, such as perfumeries. TheCompany also sells consumer products to U.S. military exchanges andcommissaries and has a licensing group, pursuant to which the Companylicenses certain of its key brand names to third parties forcomplimentary beauty-related products and accessories.

Unlessthe context otherwise requires, all references to the Company meanRevlon, Inc. and its subsidiaries. Revlon, Inc., as a public holdingcompany, has no business operations of its own and its only materialasset has been all of the outstanding capital stock of ProductsCorporation. As such, its net (loss) income has historically consistedpredominantly of the net (loss) income of Products Corporation, and in2005, 2004 and 2003 included approximately $7.6  million,$1.2  million and $1.2  million, respectively, in expensesincidental to being a public holding company.

The Company is anindirectly majority-owned subsidiary of MacAndrews & ForbesHoldings Inc. (‘‘MacAndrews & ForbesHoldings’’ and, together with its affiliates,‘‘MacAndrews & Forbes’’), a corporationwholly-owned by Ronald O. Perelman.

The accompanyingConsolidated Financial Statements include the accounts of the Companyafter elimination of all material intercompany balances andtransactions.

The preparation of financial statements inconformity with accounting principles generally accepted in the U.S.requires management to make estimates and assumptions that affectamounts of assets and liabilities and disclosures of contingent assetsand liabilities as of the date of the financial statements and reportedamounts of revenues and expenses during the periods presented. Actualresults could differ from these estimates. Estimates and assumptionsare reviewed periodically and the effects of revisions are reflected inthe consolidated financial statements in the period they are determinedto be necessary. Significant estimates made in the accompanyingConsolidated Financial Statements include, but are not limited to,allowances for doubtful accounts, inventory valuation reserves,expected sales returns and allowances, certain assumptions related tothe recoverability of intangible and long-lived assets, reserves forestimated tax liabilities, and certain estimates regarding thecalculation of the net periodic benefit costs and the projected benefitobligation for the Company’s pension and other post-retirementplans.

Cash and Cash Equivalents:

Cash equivalents areprimarily investments in high-quality, short-term money marketinstruments with original maturities of three months or less and arecarried at cost, which approximates fair value. Cash equivalents were$9.7  million and $79.0  million as of December31,  2005 and 2004, respectively. Accounts payable includes$18.2  million and $4.4  million of outstanding checks notyet presented for payment at December  31,  2005 and 2004,respectively.

In accordance with borrowing arrangements withcertain financial institutions, Products Corporation is permitted toborrow against its cash balances. The cash available to ProductsCorporation is the net of the cash position less amounts supportingthese short-term borrowings. The cash balances and related borrowingsare shown gross in the Company's Consolidated Balance Sheets. Asof December  31,  2005 and 2004, the Company had $3.2million and $36.2  million, respectively, of cash supporting suchshort-term borrowings. (See Note 8, ‘‘Short-TermBorrowings’’).

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Accounts Receivable:

Accountsreceivable represent payments due to the Company for previouslyrecognized net sales, reduced by an allowance for doubtful accounts forbalances, which are estimated to be uncollectible at December31,  2005 and 2004. The Company grants credit terms in the normalcourse of business to its customers. Trade credit is extended basedupon periodically updated evaluations of each customer's abilityto perform its obligations. The Company does not normally requirecollateral or other security to support credit sales. The allowance fordoubtful accounts is determined based on historical experience andongoing evaluations of the Company's receivables and evaluationsof the risks of payment. Accounts receivable balances are recordedagainst the allowance for doubtful accounts when they are deemeduncollectible. Recoveries of accounts receivable previously recordedagainst the allowance are recorded in the Consolidated Statements ofOperations when received. At both December  31,  2005 and2004, the Company's three largest customers accounted for anaggregate of approximately 43% of outstanding accountsreceivable.

Inventories:

Inventories are stated at thelower of cost or market value. Cost is principally determined by thefirst-in, first-out method.

Property, Plant and Equipment andOther Assets:

Property, plant and equipment is recorded at costand is depreciated on a straight-line basis over the estimated usefullives of such assets as follows: land improvements, 20 to 40 years;buildings and improvements, 5 to 45 years; machinery and equipment, 3to 17 years; and office furniture and fixtures and capitalizedsoftware, 2 to 12 years. Leasehold improvements are amortized overtheir estimated useful lives or the terms of the leases, whichever isshorter. Repairs and maintenance are charged to operations as incurred,and expenditures for additions and improvements are capitalized.

Long-lived assets, including fixed assets and intangibles other thangoodwill, are reviewed for impairment whenever events or changes incircumstances indicate that the carrying amount of an asset may not berecoverable. If events or changes in circumstances indicate that thecarrying amount of an asset may not be recoverable, the Companyestimates the undiscounted future cash flows (excluding interest)resulting from the use of the asset and its ultimate disposition. Ifthe sum of the undiscounted cash flows (excluding interest) is lessthan the carrying value, the Company recognizes an impairment loss,measured as the amount by which the carrying value exceeds the fairvalue of the asset.

Included in other assets are net permanentwall displays amounting to approximately $91.4  million and$94.2  million as of December  31,  2005 and 2004,respectively, which are generally amortized over 3 years in the U.S.and generally over 3 to 5 years outside of the U.S. Amortizationexpense for permanent wall displays for 2005, 2004 and 2003 was $70.4million, $60.9 million and $62.1 million, respectively. The Company hasincluded in other assets net costs related to the issuance of ProductsCorporation’s debt instruments amounting to approximately$33.9  million and $31.6  million as of December31,  2005 and 2004, respectively, which are amortized over theterms of the related debt instruments. In addition, the Company hasincluded in other assets trademarks, net, of $8.1  million and$7.8  million as of December  31,  2005 and 2004,respectively, and patents, net, of $2.3  million and $3.2million as of December  31,  2005 and 2004, respectively.Patents and trademarks are recorded at cost and amortized ratably overapproximately 10 to 17 years. Amortization expense for patents andtrademarks for 2005, 2004 and 2003 was $2.0  million, $1.8million and $1.8  million, respectively.

Intangible AssetsRelated to Businesses Acquired:

Intangible assets related tobusinesses acquired principally represent goodwill, which representsthe excess purchase price over the fair value of assets acquired. TheCompany accounts for its goodwill and intangible assets in accordancewith SFAS No. 142, ‘‘Goodwill and Other IntangibleAssets’’, and does not amortize its goodwill. The Companyreviews its goodwill for impairment at least annually, or wheneverevents or changes in circumstances would indicate possible impairment.The Company performs its 

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annual impairment test of goodwill as ofSeptember  30 and performed the annual test as of September30,  2005 and 2004 and concluded that no impairment existed. TheCompany operates in one reportable segment, which is also the onlyreporting unit for purposes of SFAS No. 142. Since the Companycurrently only has one reporting unit, all of the goodwill has beenassigned to the enterprise as a whole. The Company compared itsestimated fair value as measured by, among other factors, its marketcapitalization to its net assets and since the fair value wassubstantially greater than the net assets, the Company concluded thatas of December  31,  2005 there was no impairment ofgoodwill. The amount outstanding for goodwill, net, was $186.0million and $186.1  million at December  31,  2005 and2004, respectively. Accumulated amortization aggregated $117.2million and $117.3  million at December  31,  2005 and2004, respectively. Amortization of goodwill ceased on January1,  2002 upon adoption of SFAS No. 142.

In accordance withSFAS No. 142, the Company’s intangible assets with finite usefullives are amortized over their respective estimated useful lives totheir estimated residual values, and reviewed for impairment wheneverevents or changes in circumstances would indicate possible impairmentin accordance with Statement 144, ‘‘Accounting for theImpairment or Disposal of Long-Lived Assets’’.

Revenue Recognition:

Sales are recognized when revenue isrealized or realizable and has been earned. The Company's policyis to recognize revenue when risk of loss and title to the producttransfers to the customer. Net sales is comprised of gross revenuesless expected returns, trade discounts and customer allowances, whichinclude costs associated with off-invoice mark-downs and other pricereductions, as well as trade promotions and coupons. These incentivecosts are recognized at the later of the date on which the Companyrecognizes the related revenue or the date on which the Company offersthe incentive. The Company allows customers to return their unsoldproducts if and when they meet certain Company-established criteria asoutlined in the Company's trade terms. The Company regularlyreviews and revises, when deemed necessary, its estimates of salesreturns based primarily upon actual returns, planned productdiscontinuances, new product launches, estimates of customer inventoryand promotional sales, which would permit customers to return itemsbased upon the Company's trade terms. The Company records salesreturns as a reduction to sales and cost of sales, and an increase toaccrued liabilities and to inventories. Returned products which arerecorded as inventories are valued based upon the amount that theCompany expects to realize upon their subsequent disposition. Thephysical condition and marketability of the returned products are themajor factors considered by the Company in estimating realizable value.Actual returns, as well as realized values on returned products, maydiffer significantly, either favorably or unfavorably, from theCompany's estimates if factors such as product discontinuances,customer inventory levels or competitive conditions differ from theCompany's estimates and expectations and, in the case of actualreturns, if economic conditions differ significantly from theCompany's estimates and expectations. Revenues derived fromlicensing arrangements, including any prepayments, are recognized inthe period in which they become due and payable but not before theinitial license term commences.

Cost of sales includes all ofthe costs to manufacture the Company's products. For productsmanufactured in the Company's own facilities, such costs includeraw materials and supplies, direct labor and factory overhead. Forproducts manufactured for the Company by third-party contractors, suchcosts represent the amounts invoiced by the contractors. Cost of salesalso includes the cost of refurbishing products returned by customersthat will be offered for resale and the cost of inventory write-downsassociated with adjustments of held inventories to net realizablevalue. These costs are reflected in the statement of operations whenthe product is sold and net sales revenues are recognized or, in thecase of inventory write-downs, when circumstances indicate that thecarrying value of inventories is in excess of its recoverable value.Additionally, cost of sales reflects the costs associated with freeproducts. These incentive costs are recognized on the later of the datethat the Company recognizes the related revenue or the date on whichthe Company offers the incentive.

Selling, general andadministrative expenses (‘‘SG&A’’) includeexpenses to advertise the Company's products, such as televisionadvertising production costs and air-time costs, print advertisingcosts, promotional displays and consumer promotions. SG&A alsoincludes the amortization of permanent wall 

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displays and intangible assets, distributioncosts (such as freight and handling), non-manufacturing overhead,principally personnel and related expenses, insurance and professionalfees.

Income Taxes:

Income taxes are calculated usingthe asset and liability method in accordance with the provisions ofSFAS No. 109, ‘‘Accounting for IncomeTaxes.’’

Revlon, Inc. and its U.S. subsidiaries,including Products Corporation, for federal income tax purposes, wereincluded through the period ended March  25,  2004 in theaffiliated group of which MacAndrews & Forbes Holdings was thecommon parent (the ‘‘MacAndrews & ForbesGroup’’), and Revlon, Inc.'s and its U.S.subsidiaries, including Products Corporation, federal taxable incomeand loss was through the period ended March  25,  2004included in such group's consolidated tax return filed byMacAndrews & Forbes Holdings. As a result of the Revlon ExchangeTransactions (as hereinafter defined) (see Note 9,‘‘Long-Term Debt’’), as of the end of the dayon March  25,  2004, Revlon, Inc. and its U.S. subsidiaries,including Products Corporation, were no longer included in theMacAndrews & Forbes Group for federal income tax purposes.

Research and Development:

Research and developmentexpenditures are expensed as incurred. The amounts charged againstearnings in 2005, 2004 and 2003 for research and developmentexpenditures were $26.1  million, $24.0  million and$25.4  million, respectively.

Foreign CurrencyTranslation:

Assets and liabilities of foreign operations aregenerally translated into U.S. dollars at the rates of exchange ineffect at the balance sheet date. Income and expense items aregenerally translated at the weighted average exchange rates prevailingduring each period presented. Gains and losses resulting from foreigncurrency transactions are included in the results of operations. Gainsand losses resulting from translation of financial statements offoreign subsidiaries and branches operating in non-hyperinflationaryeconomies are recorded as a component of accumulated othercomprehensive loss until either sale or upon complete or substantiallycomplete liquidation by the Company of its investment in a foreignentity. Foreign subsidiaries and branches operating inhyperinflationary economies translate non-monetary assets andliabilities at historical rates and include translation adjustments inthe results of operations.

Sale of Subsidiary Stock:

The Company recognizes gains and losses on sales of subsidiary stockin its Consolidated Statements of Operations.

Basic and DilutedLoss per Common Share and Classes of Stock:

Shares used inbasic loss per share are computed using the weighted average number ofcommon shares outstanding each period. Shares used in diluted loss pershare include the dilutive effect of unvested restricted shares andoutstanding stock options using the treasury stock method. Options topurchase 33,033,097, 30,781,700 and 7,707,600 shares of Revlon, Inc.Class A common stock, par value of $0.01 per share (the‘‘Class A Common Stock’’), with weightedaverage exercise prices of $4.25, $4.66 and $10.66, respectively, wereoutstanding at December  31,  2005, 2004 and 2003,respectively. Additionally, 3,810,002, 5,725,000 and 1,970,000 sharesof unvested restricted stock were outstanding as of December31,  2005, 2004 and 2003, respectively. Because the Companyincurred losses in 2005, 2004 and 2003, these shares are excluded fromthe calculation of diluted loss per common share as their effect wouldbe antidilutive.

For each period presented, the amount of lossused in the calculation of diluted loss per common share was the sameas the amount of loss used in the calculation of basic loss per commonshare.

Stock-Based Compensation:

SFAS No. 123,‘‘Accounting for Stock-Based Compensation,‘‘encourages, but does not require, companies to record compensation costfor stock-based employee compensation plans at fair value for

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fiscal periods ended on or beforeDecember  31,  2005. For such periods, the Company has chosento account for stock-based compensation plans using the intrinsic valuemethod as prescribed in Accounting Principles Board(‘‘APB’’) Opinion No. 25,‘‘Accounting for Stock Issued to Employees,‘‘and related interpretations. Accordingly, compensation cost for stockoptions granted to employees is measured as the excess, if any, of thequoted market price of Class A Common Stock at the date of the grantover the amount an employee must pay to acquire such common stock.

The following table illustrates the effect on net loss and net lossper basic and diluted common share as if the Company had applied thefair value method to its stock-based compensation under the disclosureprovisions of SFAS No. 123 and amended disclosure provisions of SFASNo. 148, ‘‘Accounting for Stock-Based Compensation -Transition and Disclosure, an amendment of FASB Statements No.123’’, which is more fully described in Note 14,‘‘Stock Compensation Plan’’:

|                                                                                                          |  |                        |        |         |  |        |        |         |  |        |        |         |  |  |
|----------------------------------------------------------------------------------------------------------|--|------------------------|--------|---------|--|--------|--------|---------|--|--------|--------|---------|--|--|
|                                                                                                     |  | Year Ended December31, |
|                                                                                                     |  | 2005                   |        | 2004    |  | 2003   |
| Net loss as reported                                                                                     |  | $                      | (83.7  | )  |  | $      | (142.5 | )  |  | $      | (153.8 | )  |
| Add-back: Stock-based employee compensation expenseincluded in reported net loss                         |  |                   | 5.8    |    |  |   | 5.2    |    |  |   | 2.2    |    |
| Deduct: Stock-based employee compensationexpense determined under fair value based method for all awards |  |                   | (22.1  | )  |  |   | (30.3  | )  |  |   | (7.7   | )  |
| Pro forma net loss                                                                                       |  | $                      | (100.0 | )  |  | $      | (167.6 | )  |  | $      | (159.3 | )  |
| Basic and diluted loss percommon share:                                                                  |  |                   |   |    |  |   |   |    |  |   |   |    |
| As reported                                                                                              |  | $                      | (0.23  | )  |  | $      | (0.47  | )  |  | $      | (2.47  | )  |
| Pro forma                                                                                                |  | $                      | (0.27  | )  |  | $      | (0.56  | )  |  | $      | (2.56  | )  |
|                                                                                                          |

The Company uses the Black-Scholesoption valuation model (‘‘Black-Scholes’’),which is the measure of fair value most often utilized under SFAS No.123. The Company estimated the fair value of stock-based compensationissued to employees during each respective period using Black-Scholeswith the following weighted average assumptions:

|                         |  |                        |  |           |  |           |  |  |  |  |  |  |  |  |
|-------------------------|--|------------------------|--|-----------|--|-----------|--|--|--|--|--|--|--|--|
|                    |  | Year Ended December31, |
|                    |  | 2005                   |  | 2004      |  | 2003      |
| Expected life ofoption. |  | 4.75years              |  | 7.00years |  | 7.00years |
| Risk-free interest rate |  | 3.95%                  |  | 3.95%     |  | 3.72%     |
| Expected volatility.    |  | 61%                    |  | 69%       |  | 70%       |
| Expecteddividend yield  |  | N/A                    |  | N/A       |  | N/A       |
|                         |

Derivative Financial Instruments:

The Company accounts for derivative financial instruments inaccordance with SFAS No. 133, as amended by SFAS No. 149. The standardrequires the recognition of all derivative instruments on the balancesheet as either assets or liabilities measured at fair value. Changesin fair value are recognized immediately in earnings unless thederivatives qualify as hedges of future cash flows. For derivativesqualifying as hedges of future cash flows, the effective portion ofchanges in fair value is recorded as a component of other comprehensiveincome (loss) and recognized in earnings when the hedged transaction isrecognized in earnings. Any ineffective portion (representing theextent that the change in fair value of the hedges does not completelyoffset the change in the anticipated net payments being hedged) isrecognized in earnings as it occurs. If a derivative instrumentdesignated as a hedge is terminated, the unrecognized fair value of thehedge previously recorded in accumulated other comprehensive income(loss) is recognized in earnings when the hedged transaction isrecognized in earnings. If the transaction being hedged is terminated,the unrecognized fair value of the Company's related hedgeinstrument is recognized in earnings at that time.

The Companyformally designates and documents each financial instrument as a hedgeof a specific underlying exposure, as well as the risk managementobjectives and strategies for entering into the hedge 

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transaction upon inception. The Company alsoformally assesses upon inception and quarterly thereafter whether thefinancial instruments used in hedging transactions are effective inoffsetting changes in the fair value or cash flows of the hedgeditems.

The Company uses derivative financial instruments,primarily foreign currency forward exchange contracts, to reduce theeffects of fluctuations in foreign currency exchange rates. Thesecontracts, which have been designated as cash flow hedges, were enteredinto primarily to hedge anticipated inventory purchases and certainintercompany payments denominated in foreign currencies, which havematurities of less than one year. Any unrecognized income (loss)related to these contracts are recorded in the Statement of Operationsprimarily in cost of goods sold when the underlying transactions hedgedare realized (e.g., when inventory is sold or intercompany transactionsare settled). Products Corporation enters into these contracts withcounterparties that are major financial institutions, and accordinglythe Company believes that the risk of counterparty nonperformance isremote. During 2005, 2004 and 2003, net derivative losses of $2.2million, $1.5  million and $1.5  million, respectively, werereclassified to the Statement of Operations. The notional amount of theforeign currency forward exchange contracts outstanding atDecember  31,  2005 and 2004 was $31.9  million and$31.5  million, respectively. The fair value of the foreigncurrency forward exchange contracts outstanding at December31,  2005 and 2004 was $(0.2) million and $(2.3) million,respectively, and is recorded in ‘‘Accrued expenses andother’’ in the accompanying Consolidated Balance Sheets.The Company had accumulated net derivative losses of $(0.3) million inother comprehensive loss as of December  31,  2005 related tocash flow hedges, all of which will be reclassified into earningswithin 12 months. The amount of the hedges' ineffectiveness forthe years ended December  31,  2005 and 2004 recorded in theConsolidated Statements of Operations was not significant.

Advertising and Promotion:

Costs associated withadvertising and promotion are expensed when incurred. The costs ofpromotional displays are expensed in the period in which they areshipped to customers. Television advertising production costs areexpensed the first time the advertising takes place. Advertising andpromotion expenses were $230.5  million, $225.2  million and$251.4  million for 2005, 2004 and 2003, respectively, and wereincluded in SG&A in the Company's Consolidated Statements ofOperations. The Company also has various arrangements with customerspursuant to its trade terms to reimburse them for a portion of theiradvertising or promotional costs, which provide advertising andpromotional benefits to the Company. Additionally, from time to timethe Company may pay fees to customers in order to expand or maintainshelf space for its products. The costs that the Company incurs for‘‘cooperative" advertising programs, end capplacement, shelf placement costs and slotting fees are expensed asincurred and are netted against revenues on the Company'sConsolidated Statements of Operations.

Distribution Costs:

Costs, such as freight and handling costs, associated withdistribution are expensed within SG&A when incurred. Distributioncosts were $68.3  million, $62.0  million and $60.4million for 2005, 2004 and 2003, respectively.

RecentAccounting Pronouncements:

In May  2005, the FASB issuedSFAS No. 154, ‘‘Accounting Changes and ErrorCorrections.’’ SFAS No. 154 requires retroactiveapplication of a voluntary change in accounting principle to priorperiod financial statements unless it is impracticable. SFAS No. 154also requires that a change in method of depreciation, amortization ordepletion for long-lived, non-financial assets be accounted for as achange in accounting estimate that is affected by a change inaccounting principle. SFAS No. 154 replaces APB Opinion No. 20,‘‘Accounting Changes’’ and SFAS No. 3,‘‘Reporting Accounting Changes in Interim FinancialStatements’’. SFAS No. 154 is effective for fiscal yearsbeginning after December  15,  2005. The Company will adoptthe provisions of SFAS No. 154 as of January  1,  2006 anddoes not expect that its adoption will have a material impact on itsresults of operations or financial condition.

In December2004, the FASB issued SFAS No. 123 (revised 2004),‘‘Share-Based Payment’’, an amendment to FASBStatements Nos. 123 and 95 (‘‘SFAS No.123(R)’’), which replaces SFAS No. 123, 

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and supercedes APB Opinion No. 25,‘‘Accounting for Stock Issued to Employees’’.SFAS No. 123(R) requires all share-based payments to employees,including grants of employee stock options, to be recognized in thefinancial statements based on their fair values. In April  2005,the U.S. Securities and Exchange Commission (the‘‘SEC’’ or the‘‘Commission’’) adopted a rule allowingcompanies to implement SFAS No. 123(R) at the beginning of their nextfiscal year that begins after June  15,  2005, which for theCompany will be effective beginning January  1,  2006. TheCompany will use the modified prospective transition method, utilizingthe Black-Scholes option pricing model for the calculation of the fairvalue of its employee stock options. Under the modified prospectivemethod, stock option awards that are granted, modified or settled afterJanuary  1,  2006 will be measured and accounted for inaccordance with SFAS No. 123(R). Compensation cost for awards grantedprior to, but not vested, as of January  1,  2006 would bebased on the grant date attributes originally used to value thoseawards for pro forma purposes under SFAS No. 123. The Company expectsthe adoption of SFAS No. 123(R) will have a material impact for2006.

In November  2004, the FASB issued SFAS No. 151,‘‘Inventory Costs — An Amendment of ARB No. 43,Chapter 4’’. SFAS No. 151 amends the guidance in ARB No.43, Chapter 4, ‘‘Inventory Pricing’’, toclarify the accounting for abnormal amounts of idle facility expense,freight, handling costs and wasted materials (spoilage). Among otherprovisions, the new rule requires that the aforementioned items berecognized as current-period charges. Additionally, SFAS No. 151requires that the allocation of fixed production overheads to the costsof conversion be based on the normal capacity of the productionfacilities. SFAS No. 151 is effective for fiscal years beginning afterJune  15,  2005 and is required to be adopted by the Companybeginning on January  1,  2006. The Company had early adoptedthe provisions of SFAS No. 151 during the third quarter of 2005, whichadoption did not have a material impact on the Company’sconsolidated results of operations and financial position.

2.    RESTRUCTURING COSTS AND OTHER, NET

During 2005, the Company recorded net charges of $1.5  millionfor employee severance and other related personnel benefits. During2004, the Company recorded net charges of $5.8  million primarilyfor employee severance and other related personnel benefits for 42employees in connection with realignments within several departmentalfunctions and international operations, as to which 40 employees hadbeen terminated as of December  31,  2005. In 2003, theCompany recorded separate charges of $5.9  million for employeeseverance and other personnel benefits for 421 employees in certainInternational operations, as to which 397 employees had been terminatedas of December  31,  2005.

Designed to improveprofitability by reducing personnel and consolidating certainfacilities, the 2000 restructuring program accounted for the obligationof excess leased real estate in the Company's old New York Cityheadquarters, consolidation costs associated with the Company closingcertain facilities and the elimination of several domestic andinternational executive and operational positions. The 2000restructuring program was fully paid-out in 2004.

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Details of the activity described aboveduring 2005, 2004 and 2003 are as follows:

|                                                |  |                          |         |               |  |               |         |                     |  |        |         |         |  |        |         |         |  |        |         |        |  |  |
|------------------------------------------------|--|--------------------------|---------|---------------|--|---------------|---------|---------------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|--------|--|--|
|                                           |  | Balance Beginning ofYear |         | Expenses, Net |  | Utilized, Net |         | Balance End of Year |
|                                           |  | Cash                     |         | Noncash       |
| **2005**                                       |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| Employeeseverance and other personnelbenefits: |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| 2003programs                                   |  | $                        | 3.1     |          |  | $             | — |                |  | $      | (1.7    | )  |  | $      | (0.2    | )  |  | $      | 1.2     |   |
| 2004 programs                                  |  |                     | 5.1     |          |  |          | 1.5     |                |  |   | (3.9    | )  |  |   | (0.3    | )  |  |   | 2.4     |   |
|                                           |  |                     | 8.2     |          |  |          | 1.5     |                |  |   | (5.6    | )  |  |   | (0.5    | )  |  |   | 3.6     |   |
| Leases and equipment write-offs                |  |                     | 2.9     |          |  |          | — |                |  |   | (2.0    | )  |  |   | (0.3    | )  |  |   | 0.6     |   |
|                                           |  | $                        | 11.1    |          |  | $             | 1.5     |                |  | $      | (7.6    | )  |  | $      | (0.8    | )  |  | $      | 4.2     |   |
| **2004**                                       |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| Employeeseverance and other personnelbenefits: |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| 2000program                                    |  | $                        | 1.8     |          |  | $             | — |                |  | $      | (1.8    | )  |  | $      | — |    |  | $      | — |   |
| 2003program                                    |  |                     | 5.0     |          |  |          | 0.1     |                |  |   | (2.4    | )  |  |   | 0.4     |    |  |   | 3.1     |   |
| 2004 program                                   |  |                     | — |          |  |          | 5.9     |                |  |   | (0.8    | )  |  |   | — |    |  |   | 5.1     |   |
|                                           |  |                     | 6.8     |          |  |          | 6.0     |                |  |   | (5.0    | )  |  |   | 0.4     |    |  |   | 8.2     |   |
| Leases and equipment write-offs                |  |                     | 2.2     |          |  |          | (0.2    | )              |  |   | 0.6     |    |  |   | 0.3     |    |  |   | 2.9     |   |
|                                           |  | $                        | 9.0     |          |  | $             | 5.8     |                |  | $      | (4.4    | )  |  | $      | 0.7     |    |  | $      | 11.1    |   |
| **2003**                                       |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| Employeeseverance and other personnelbenefits: |  |                     |    |          |  |          |    |                |  |   |    |    |  |   |    |    |  |   |    |   |
| 2000program.                                   |  | $                        | 7.0     |          |  | $             | — |                |  | $      | (5.2    | )  |  | $      | — |    |  | $      | 1.8     |   |
| 2003 program.                                  |  |                     | — |          |  |          | 5.9     |                |  |   | (0.9    | )  |  |   | — |    |  |   | 5.0     |   |
|                                           |  |                     | 7.0     |          |  |          | 5.9     |                |  |   | (6.1    | )  |  |   | — |    |  |   | 6.8     |   |
| Relocation                                     |  |                     | — |          |  |          | 0.1     |                |  |   | (0.1    | )  |  |   | — |    |  |   | — |   |
| Leases and equipmentwrite-offs                 |  |                     | 3.9     |          |  |          | — |                |  |   | (1.7    | )  |  |   | — |    |  |   | 2.2     |   |
| Other obligations                              |  |                     | 0.9     |          |  |          | — |                |  |   | — |    |  |   | (0.9    | )  |  |   | — |   |
|                                           |  | $                        | 11.8    |          |  | $             | 6.0     |                |  | $      | (7.9    | )  |  | $      | (0.9    | )  |  | $      | 9.0     |   |
|                                                |

As ofDecember  31,  2005, 2004 and 2003, the unpaid balance of therestructuring costs and other, net for reserves are included in‘‘Accrued expenses and other’’ and‘‘Other long-term liabilities’’ in theCompany's Consolidated Balance Sheets. The remaining balance atDecember  31,  2005 for employee severance and otherpersonnel benefits is $4.2  million, of which $3.8  millionis expected to be paid by the end of 2006 and the remaining obligationsof $0.4  million are expected to be paid by the end of 2008.

3.    DISPOSITIONS

In December  2003,the Company sold a facility located in Canada for approximately$5.2  million and leased it back through the end of 2006. Inconnection with such disposition, the Company would recognize a pre-taxand after-tax net gain of approximately $1.7  million ratably overthe remaining 3-year lease term, of which approximately $0.6 millionwas recognized in each of 2005 and 2004, with the remaining amount tobe recognized in 2006. For 2005 and 2004, the Company had no additionaldispositions.

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4.    INVENTORIES

|                            |  |              |       |        |  |        |       |        |  |  |
|----------------------------|--|--------------|-------|--------|--|--------|-------|--------|--|--|
|                       |  | December 31, |
|                       |  | 2005         |       | 2004   |
| Raw materials and supplies |  | $            | 60.7  |   |  | $      | 48.1  |   |
| Work-in-process            |  |         | 17.6  |   |  |   | 12.2  |   |
| Finished goods             |  |         | 142.3 |   |  |   | 94.4  |   |
|                       |  | $            | 220.6 |   |  | $      | 154.7 |   |
|                            |

5.    PREPAID EXPENSES ANDOTHER

|                               |  |              |         |        |  |        |      |        |  |  |
|-------------------------------|--|--------------|---------|--------|--|--------|------|--------|--|--|
|                          |  | December 31, |
|                          |  | 2005         |         | 2004   |
| Prepaid expenses              |  | $            | 37.8    |   |  | $      | 35.4 |   |
| Note receivable (See Note 11) |  |         | — |   |  |   | 15.9 |   |
| Other.                        |  |         | 18.9    |   |  |   | 18.4 |   |
|                          |  | $            | 56.7    |   |  | $      | 69.7 |   |
|                               |

6.    PROPERTY, PLANT ANDEQUIPMENT,NET

|                                                    |  |              |        |         |  |        |        |         |  |  |
|----------------------------------------------------|--|--------------|--------|---------|--|--------|--------|---------|--|--|
|                                               |  | December 31, |
|                                               |  | 2005         |        | 2004    |
| Land and improvements                              |  | $            | 2.2    |    |  | $      | 2.3    |    |
| Building and improvements                          |  |         | 57.6   |    |  |   | 57.3   |    |
| Machinery, equipment and capitalleases             |  |         | 125.7  |    |  |   | 125.1  |    |
| Officefurniture, fixtures and capitalized software |  |         | 110.3  |    |  |   | 110.6  |    |
| Leasehold improvements                             |  |         | 18.9   |    |  |   | 17.4   |    |
| Construction-in-progress                           |  |         | 14.9   |    |  |   | 7.8    |    |
|                                               |  |         | 329.6  |    |  |   | 320.5  |    |
| Accumulateddepreciation                            |  |         | (209.9 | )  |  |   | (201.8 | )  |
|                                               |  | $            | 119.7  |    |  | $      | 118.7  |    |
|                                                    |

Depreciation expense for the yearsended December  31,  2005, 2004 and 2003 was $22.7million, $34.0  million and $33.7  million, respectively. In2002, the Company evaluated its management information systems anddetermined, among other things, to upgrade its systems. As a result ofthis decision, certain existing information systems were amortized onan accelerated basis. The additional amortization recorded in 2004 and2003 was $4.3  million and $4.6  million, respectively, andthese information systems were then fully amortized in 2004.

7.    ACCRUED EXPENSES AND OTHER

|                                       |  |             |       |        |  |        |       |        |  |  |
|---------------------------------------|--|-------------|-------|--------|--|--------|-------|--------|--|--|
|                                  |  | December31, |
|                                  |  | 2005        |       | 2004   |
| Sales returns and allowances          |  | $           | 141.2 |   |  | $      | 103.3 |   |
| Advertising andpromotional costs      |  |        | 48.0  |   |  |   | 45.5  |   |
| Compensation and related benefits     |  |        | 61.5  |   |  |   | 56.9  |   |
| Interest.                             |  |        | 28.5  |   |  |   | 20.9  |   |
| Taxes, other than federal incometaxes |  |        | 13.8  |   |  |   | 13.0  |   |
| Restructuringcosts                    |  |        | 3.8   |   |  |   | 7.6   |   |
| Other                                 |  |        | 31.6  |   |  |   | 36.0  |   |
|                                  |  | $           | 328.4 |   |  | $      | 283.2 |   |
|                                       |

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8.    SHORT-TERMBORROWINGS

Products Corporation had outstandingshort-term bank borrowings (excluding borrowings under the 2004 CreditAgreement (as defined in Note 9)) aggregating $9.0  million and$36.6  million at December  31,  2005 and 2004,respectively. The weighted average interest rate on short-termborrowings outstanding at December  31,  2005 and 2004 was13.7% and 4.2%, respectively. The higher weighted averageinterest rate for short-term borrowings in 2005 reflects higher-rateborrowings in certain Latin American countries and the cessation of oneof the Company’s cash-collateralized borrowing arrangements witha financial institution. Under these cash-collateralized borrowingarrangements, the Company was permitted to borrow against its cashbalances. The cash balances and related borrowings are shown gross inthe Company's Consolidated Balance Sheets. As of December31,  2005 and 2004, the Company had $3.2  million and$36.2  million, respectively, of cash supporting such short-termborrowings. Interest rates on these cash balances at December31,  2005 and 2004 ranged from 0.3% to 0.5% and0.5% to 4.5%, respectively.

9.    LONG-TERM DEBT

|                                                         |  |              |         |        |  |        |         |         |  |  |
|---------------------------------------------------------|--|--------------|---------|--------|--|--------|---------|---------|--|--|
|                                                    |  | December 31, |
|                                                    |  | 2005         |         | 2004   |
| 2004 Credit Agreement(a):                               |  |         |    |   |  |   |    |    |
| Term Loan Facility due2010                              |  | $            | 700.0   |   |  | $      | 800.0   |    |
| Multi-Currency Facility due 2009                        |  |         | — |   |  |   | — |    |
| 8 1/8% SeniorNotes due 2006 (b)                         |  |         | — |   |  |   | 116.2   |    |
| 9% Senior Notes due 2006 (c)                            |  |         | — |   |  |   | 75.5    |    |
| 91⁄2% Senior Notesdue 2011, net of discounts (d)   |  |         | 386.4   |   |  |   | — |    |
| 8 5/8% SeniorSubordinated Notes due 2008 (e)            |  |         | 327.0   |   |  |   | 327.0   |    |
| 2004 Consolidated MacAndrews & ForbesLine of Credit |  |         | — |   |  |   | — |    |
|                                                    |  |         | 1,413.4 |   |  |   | 1,318.7 |    |
| Less current portion                                    |  |         | — |   |  |   | (10.5   | )  |
|                                                    |  | $            | 1,413.4 |   |  | $      | 1,308.2 |    |
|                                                         |

The Company completed two significantfinancing transactions during 2005: (i) Products Corporation issued$310.0  million aggregate principal amount of its91⁄2% Senior Notes (as hereinafter defined), andusing the proceeds of such notes, Products Corporation completed theredemption of all $116.2  million aggregate principal amountoutstanding of its 8 1/8% Senior Notes (ashereinafter defined) and all $75.5  million aggregate principalamount outstanding of its 9% Senior Notes (as hereinafterdefined) and prepaid $100.0  million of the Term Loan Facility (ashereinafter defined) and paid related fees and expenses incurred inconnection with such transactions and (ii) Products Corporation issued$80.0  million aggregate principal amount of additional91⁄2% Senior Notes, which priced at951⁄4% of par, and used the proceeds to fundgeneral corporate purposes, principally to fund its brand initiatives,namely the relaunch of the **Almay** brand and the launch of its new**Vital Radiance** brand.

The Company completed twosignificant financing transactions during 2004: (i) Revlon, Inc.exchanged approximately $804  million of ProductsCorporation's debt, $54.6  million of Revlon, Inc. preferredstock and $9.9  million of accrued interest for 299,969,493 sharesof Class A Common Stock (the ‘‘Revlon ExchangeTransactions’’) and (ii) Products Corporation entered intothe 2004 Credit Agreement, consisting of an $800.0  million termloan facility (before giving effect to the $100.0  millionprepayment discussed above) and a $160.0  million asset-basedmulti-currency revolving credit facility, and used the proceeds torefinance its 2001 Credit Agreement (as hereinafter defined) and tocomplete a tender offer and subsequent redemption of all of its12% Senior Secured Notes due 2005. See discussionbelow.

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(a)    2004 CreditAgreement:

In July  2004, Products Corporation enteredinto a new credit agreement (the ‘‘2004 CreditAgreement’’) with certain of its subsidiaries as localborrowing subsidiaries, a syndicate of lenders, and Citicorp USA, Inc.,as multi-currency administrative agent, term loan administrative agentand collateral agent.

The 2004 Credit Agreement originallyprovided up to $960.0  million and, before giving effect to the$100.0  million prepayment in March  2005, consisted of an$800.0  million term loan facility (the ‘‘Term LoanFacility’’) and a $160.0  million asset-basedmulti-currency facility (the ‘‘Multi-CurrencyFacility’’), the availability under which varies based uponthe borrowing base that is based upon the value of eligible accountsreceivable, eligible inventory and eligible real property and equipmentin the U.S. and the U.K. from time to time. Products Corporation mayrequest the Multi-Currency Facility to be increased from time to timein an aggregate principal amount not to exceed $50.0  millionsubject to certain exceptions and subject to the lenders’agreement. The Multi-Currency Facility is available to: (i) ProductsCorporation in revolving credit loans denominated in U.S. dollars, (ii)Products Corporation in swing line loans denominated in U.S. dollars upto $25.0  million, (iii) Products Corporation in standby andcommercial letters of credit denominated in U.S. dollars and othercurrencies up to $50.0  million and (iv) Products Corporation andcertain of its international subsidiaries designated from time to timein revolving credit loans and bankers’ acceptances denominatedin U.S. dollars and other currencies, in each case subject to borrowingbase availability. If the value of the eligible assets is notsufficient to support the $160.0  million borrowing base, ProductsCorporation will not have full access to the Multi-Currency Facility.Products Corporation’s ability to make borrowings under theMulti-Currency Facility is also conditioned upon the satisfaction ofcertain conditions precedent and Products Corporation’scompliance with other covenants in the 2004 Credit Agreement, includinga fixed charge coverage ratio that applies if and when the excessborrowing base is less than $30.0  million. In March  2005,Products Corporation prepaid $100.0  million of indebtednessoutstanding under the Term Loan Facility, together with accruedinterest and the $5.0  million prepayment fee associated with suchprepayment, using proceeds from the issuance of the Original91⁄2% Senior Notes (as hereinafter defined).

During July and August  2004, Products Corporation used theproceeds from borrowings under the Term Loan Facility to repay in fullthe $290.5  million of outstanding indebtedness (including accruedinterest) under Products Corporation's credit agreement datedNovember  30,  2001 and which was scheduled to mature onMay  30,  2005 (as amended, the ‘‘2001 CreditAgreement’’), to purchase and redeem in July andAugust  2004 (the ‘‘Tender Offer’’) all ofthe $363.0  million aggregate principal amount of ProductsCorporation’s 12% Senior Secured Notes for a purchaseprice of approximately $412.3  million (including the applicablepremium and accrued interest), and to pay fees and expenses incurred inconnection with the 2004 Credit Agreement, the Tender Offer for the12% Senior Secured Notes and the Revlon Exchange Transactions,including the payment of expenses related to a refinancing thatProducts Corporation launched in May  2004 but did not consummate.The balance of such proceeds was available to Products Corporation forgeneral corporate purposes.

The Multi-Currency Facility willterminate on July  9,  2009 and the loans under the Term LoanFacility will mature on July  9,  2010; provided that the2004 Credit Agreement will terminate on October  30,  2007 ifthe 8 5/8% Senior Subordinated Notes (ashereinafter defined) are not redeemed, repurchased, defeased or repaidon or before such date such that not more than $25.0  million inaggregate principal amount of such notes remain outstanding. Inaddition to customary events of default, it would be an event ofdefault under the 2004 Credit Agreement if Revlon, Inc. fails toundertake an approximately $110.0  million equity issuance andtransfer the proceeds of such equity issuance to Products Corporationby March  31,  2006 to promptly reduce its outstandingindebtedness. See Note 20, ‘‘SubsequentEvents’’.

Borrowings under the Multi-CurrencyFacility (other than loans in foreign currencies) bear interest at arate equal to, at Products Corporation's option, either (A) theAlternate Base Rate plus 1.50%; or (B) the Eurodollar Rate plus2.50%. Loans in foreign currencies bear interest in certainlimited circumstances or if mutually acceptable to Products Corporationand the relevant foreign lenders at the Local Rate, and otherwise atthe Eurocurrency Rate, in each case plus 2.50%. The loans underthe Term 

F-18

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Loan Facility bear interest at a rate equalto, at Products Corporation's option, either (A) the AlternateBase Rate plus 5.00%; or (B) the Eurodollar Rate plus6.00%. At December  31,  2005, the weighted averagerate for borrowings under the Term Loan Facility was 10.1%.

The 2004 Credit Agreement requires Products Corporation to complywith various financial covenants and restrictions, including covenantsand restrictions relating to indebtedness, liens, investments, sales ofassets, mergers and acquisitions, dividends and transactions withProducts Corporation’s affiliates, each of which is subject tolimited exceptions. Additionally, the 2004 Credit Agreement containsfinancial covenants limiting Products Corporation’s seniorsecured leverage ratio (the ratio of Products Corporation’sSenior Secured Debt to EBITDA, as each such term is defined in the 2004Credit Agreement) to 5.50 to 1.00 for the four consecutive quartersending during the period from December  31,  2004 toSeptember  30,  2005; 5.00 to 1.00 for the four consecutivequarters ending during the period from December  31,  2005 toDecember  31,  2006; and 4.50 to 1.00 for the fourconsecutive quarters ending March  31,  2007 and eachsubsequent quarter until the maturity date of the 2004 CreditAgreement. Additionally, under any circumstances when the excessborrowing base under the Multi-Currency Facility is less than$30.0  million for a period of 30 consecutive days or more,Products Corporation would be required to maintain a consolidated fixedcharge coverage ratio (the ratio of EBITDA minus Capital Expendituresto Cash Interest Expense for such period, as each such term is definedin the 2004 Credit Agreement) of 1.00 to 1.00. Products Corporation wasin compliance with all applicable covenants under the 2004 CreditAgreement as of December  31,  2005. (See Note 20,‘‘Subsequent Events’’, regarding recentamendments to the financial covenants under the 2004 CreditAgreement).

At December  31,  2005, the Term LoanFacility was fully drawn and availability under the Multi-CurrencyFacility, based upon the calculated borrowing base less approximately$16 million of outstanding letters of credit, was approximately$144  million, as the Multi-Currency Facility was undrawn.

(b)    Redemption of the 8 1/8% SeniorNotes due 2006 (the ‘‘8 1/8% SeniorNotes’’):

The 8 1/8%Senior Notes, prior to their redemption in April  2005, weresenior unsecured obligations of Products Corporation and ranked equallyin right of payment with all existing and future senior debt ofProducts Corporation, including the 91⁄2% SeniorNotes, the indebtedness under the 2004 Credit Agreement and theindebtedness under the 2004 Consolidated MacAndrews & Forbes Lineof Credit (as hereinafter defined) and were senior to the8 5/8% Senior Subordinated Notes and to allfuture subordinated indebtedness of Products Corporation. The8 1/8% Senior Notes were effectively subordinatedto the outstanding indebtedness and other liabilities of ProductsCorporation's subsidiaries. Interest was payable on February1 and August  1.

The principal amount of $116.2million outstanding of the 8 1/8% Senior Noteswas redeemed in April  2005. The aggregate redemption price of the8 1/8% Senior Notes was $118.1  million,which constituted the principal amount and interest payable on the8 1/8% Senior Notes. In connection with theredemption, the Company recognized a loss on extinguishment of debt(see ‘‘(c)’’ below).

(c)    Redemption of the 9% Senior Notes due 2006 (the‘‘9% Senior Notes’’):

The9% Senior Notes, prior to their redemption in April  2005,were senior unsecured obligations of Products Corporation and rankedequally in right of payment with all existing and future senior debt ofProducts Corporation, including the 91⁄2% SeniorNotes, the indebtedness under the 2004 Credit Agreement and theindebtedness under the 2004 Consolidated MacAndrews & Forbes Lineof Credit and were senior to the 8 5/8% SeniorSubordinated Notes and to all future subordinated indebtedness ofProducts Corporation. The 9% Senior Notes were effectivelysubordinated to outstanding indebtedness and other liabilities ofProducts Corporation's subsidiaries. Interest was payable onMay  1 and November  1.

The principal amount of$75.5  million outstanding of the 9% Senior Notes wasredeemed in April  2005. The aggregate redemption price of the9% Senior Notes was $79.8  million, which constituted theprincipal amount, interest payable on the 9% Senior Notes andthe applicable premium.

In connection with the redemption of the9% Senior Notes and the redemption of the8 1/8% Senior Notes, the Company recognized aloss on extinguishment of debt of $1.5  million.

F-19

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(d)    91⁄2%Senior Notes due 2011:

Products Corporation issued$310.0  million aggregate principal amount of91⁄2% Senior Notes due 2011 (the‘‘Original 91⁄2% SeniorNotes’’) pursuant to an indenture, dated as of March16,  2005, by and between Products Corporation and U.S. BankNational Association, as trustee. This issuance and the relatedtransactions extended the maturities of Products Corporation'sdebt that would have otherwise been due in 2006.

The proceedsfrom the Original 91⁄2% Senior Notes were usedto prepay $100.0  million of indebtedness outstanding under theTerm Loan Facility of Products Corporation’s 2004 CreditAgreement, together with accrued interest and the associated $5.0million prepayment fee and to pay $7.0  million in certain feesand expenses associated with the issuance of the Original91⁄2% Senior Notes. The remaining $197.9million of proceeds from the Original 91⁄2%Senior Notes was placed in a debt defeasance trust and, in April2005, used to redeem $116.2  million aggregate principal amountoutstanding of Products Corporation’s8 1/8% Senior Notes, plus accrued interest, and$75.5  million aggregate principal amount outstanding of ProductsCorporation’s 9% Senior Notes, plus accrued interest andthe applicable premium. The aggregate redemption amounts for the8 1/8% Senior Notes and 9% Senior Noteswere $118.1  million and $79.8  million, respectively, whichconstituted the principal amount and interest payable on the8 1/8% Senior Notes and the 9% SeniorNotes up to, but not including, the redemption date, and, with respectto the 9% Senior Notes, the applicable premium. In connectionwith the redemption, the Company recognized a loss on extinguishment ofdebt of $1.5  million. Amounts prepaid under the Term LoanFacility permanently reduced the commitment and are not available forfuture borrowings. In June  2005, all of the Original91⁄2% Senior Notes were exchanged for new91⁄2% Senior Notes (the ‘‘March 200591⁄2% Senior Notes’’), which havesubstantially identical terms to the Original91⁄2% Senior Notes, except that the March2005  91⁄2% Senior Notes are registeredwith the SEC under the Securities Act of 1933, as amended (the‘‘Securities Act’’), and the transferrestrictions and registration rights applicable to the Original91⁄2% Senior Notes do not apply to theMarch  2005  91⁄2% Senior Notes.

In August  2005, Products Corporation issued $80.0million aggregate principal amount of additional91⁄2% Senior Notes due 2011, which priced at951⁄4% of par (the "Additional91⁄2% Senior Notes") in a privateplacement to institutional buyers, as additional notes pursuant to thesame indenture governing the Original 91⁄2%Senior Notes. The issuance of the Additional91⁄2% Senior Notes constituted a furtherissuance of, are the same series as, and will vote on any matterssubmitted to note holders with, the Original91⁄2% Senior Notes. The Company used theproceeds of this issuance to help fund investments in theCompany’s brand initiatives and for general corporate purposes,as well as to pay fees and expenses in connection with the issuance ofthe Additional 91⁄2% Senior Notes and anyoutstanding fees and expenses in connection with the issuance of andexchange offer for the Original 91⁄2% SeniorNotes.

On December  27,  2005, all of the Additional91⁄2% Senior Notes issued by ProductsCorporation were exchanged for new 91⁄2% SeniorNotes (the ‘‘August 2005 91⁄2%Senior Notes’’), which have substantially identical termsto the Additional 91⁄2% Senior Notes, exceptthat the August  2005  91⁄2% SeniorNotes are registered with the SEC under the Securities Act, and thetransfer restrictions and registration rights applicable to theAdditional 91⁄2% Senior Notes do not apply tothe August  2005  91⁄2% Senior Notes(which are collectively referred to with the March  200591⁄2% Senior Notes as the"91⁄2% SeniorNotes").

The 91⁄2% SeniorNotes are senior unsecured obligations of Products Corporation rankingequally in right of payment with any of Products Corporation'spresent and future senior indebtedness, including the indebtednessunder the 2004 Credit Agreement and the indebtedness under the 2004MacAndrews & Forbes Line of Credit, and are senior to the8 5/8% Senior Subordinated Notes and to allfuture subordinated indebtedness of Products Corporation. The91⁄2% Senior Notes are effectively subordinatedto the outstanding indebtedness and other liabilities of ProductsCorporation’s subsidiaries. The 91⁄2%Senior Notes bear interest at an annual rate of91⁄2%, which is payable on April  1 andOctober  1 of each year, commencing with October  1,2005. The 91⁄2% Senior Notes indenture providesthat Products Corporation may redeem the 91⁄2%Senior Notes at its option, in whole or in part, at any time on orafter April  1,  2008, at the redemption prices set forth inthe 91⁄2% Senior Notes indenture. In addition,at any time prior to April  1,  2008 Products Corporation isentitled to redeem up to 35% of the aggregate principal

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amount of the 91⁄2%Senior Notes at a redemption price of 109.5% of the principalamount thereof, plus accrued and unpaid interest, if any, to the dateof redemption, with, to the extent actually received, the net cashproceeds of one or more public equity offerings, provided that at least65% of the aggregate principal amount of the91⁄2% Senior Notes issued remains outstandingimmediately after giving effect to such redemption. In addition, the91⁄2% Senior Notes indenture provides thatProducts Corporation is entitled to redeem the91⁄2% Senior Notes at any time or from time totime prior to April  1,  2008 at a redemption price per noteequal to the sum of (1) the then outstanding principal amount thereof,plus (2) accrued and unpaid interest, if any, to the date ofredemption, plus (3) the greater of (i) 1.0% of the thenoutstanding principal amount of such note and (ii) the excess of (A)the present value at such redemption date of (1) the redemption priceof such note on April  1,  2008 (exclusive of any accruedinterest) plus (2) all required remaining scheduled interest paymentsdue on such note through April  1,  2008, computed using adiscount rate equal to the applicable treasury rate plus 75 basispoints, over (B) the then outstanding principal amount of such note.Pursuant to the 91⁄2% Senior Notes indenture,upon a Change of Control (as defined in the91⁄2% Senior Notes indenture), each holder ofthe 91⁄2% Senior Notes has the right to requireProducts Corporation to make an offer to repurchase all or a portion ofsuch holder's 91⁄2% Senior Notes at a priceequal to 101% of the principal amount of such holder's91⁄2% Senior Notes, plus accrued and unpaidinterest, if any, thereon to the date of repurchase.

The91⁄2% Senior Notes indenture contains covenantswhich, subject to certain exceptions, limit the ability of ProductsCorporation and its subsidiaries to, among other things, incuradditional indebtedness, pay dividends on or redeem or repurchasestock, engage in certain asset sales, make certain types of investmentsand other restricted payments, engage in transactions with affiliates,restrict dividends or payments from subsidiaries and create liens ontheir assets. All of these limitations and prohibitions, however, aresubject to a number of important qualifications and exceptions. The91⁄2% Senior Notes indenture contains customaryevents of default (see below item (e) for details).

(e)    The 8 5/8% Senior SubordinatedNotes due 2008 (the "8 5/8% SeniorSubordinated Notes"): 

The8 5/8% Senior Subordinated Notes are generalunsecured obligations of Products Corporation and (i) are subordinatein right of payment to all existing and future senior debt of ProductsCorporation, including the 91⁄2% Senior Notes,the indebtedness under the 2004 Credit Agreement and the indebtednessunder the 2004 Consolidated MacAndrews & Forbes Line of Credit,(ii) rank equally in right of payment with all future seniorsubordinated debt, if any, of Products Corporation and  (iii) aresenior in right of payment to all future junior subordinated debt, ifany, of Products Corporation. The 8 5/8% SeniorSubordinated Notes are effectively subordinated to the outstandingindebtedness and other liabilities of Products Corporation'ssubsidiaries. Interest is payable on February  1 and August1.

The 8 5/8% Senior Subordinated Notesare due February  2008 and may be redeemed at the option ofProducts Corporation in whole or from time to time in part at any timeon or after February  1,  2003 at the redemption prices setforth in the 8 5/8% Senior Subordinated Notesindenture, plus accrued and unpaid interest, if any, to the date ofredemption. The 2004 Credit Agreement requires that ProductsCorporation redeem, repurchase or defease on or before October30,  2007 the 8 5/8% Senior SubordinatedNotes such that not more than $25.0  million in aggregateprincipal amount of the 8 5/8% SeniorSubordinated Notes remains outstanding. Otherwise, the 2004 CreditFacilities will terminate and all amounts outstanding under the 2004Credit Facilities will become due on such date. In 2004, approximately$322.9  million principal amount of the8 5/8% Senior Subordinated Notes were exchangedfor Class A Common Stock in the Revlon Exchange Transactions, asdiscussed below. See Note 20, ‘‘SubsequentEvents’’, regarding the Company’s plans to redeem,repurchase or defease approximately $110  million of the8 5/8% Senior Subordinated Notes.

Upon aChange of Control, as defined in the 8 5/8%Senior Subordinated Notes indenture, Products Corporation will have theoption to redeem the 8 5/8% Senior SubordinatedNotes in whole at a redemption price equal to the principal amountthereof, plus accrued and unpaid interest, if any, thereon to the dateof redemption, plus the applicable premium, as defined in the8 5/8% Senior Subordinated Notes indenture, and,subject to certain conditions, each holder of the8 5/8% Senior Subordinated Notes will have theright to require Products Corporation to repurchase all or a portion ofsuch holder's 8 5/8% Senior SubordinatedNotes at a price equal to 101% of the principal amount thereof,plus accrued and unpaid interest, if any, thereon to the date ofrepurchase.

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The 8 5/8% SeniorSubordinated Notes indenture contains covenants that, among otherthings, limit (i) the issuance of additional debt and redeemable stockby Products Corporation, (ii) the incurrence of liens, (iii) theissuance of debt and preferred stock by Products Corporation'ssubsidiaries, (iv) the payment of dividends on capital stock ofProducts Corporation and its subsidiaries and the redemption of capitalstock of Products Corporation, (v) the sale of assets and subsidiarystock, (vi)  transactions with affiliates, (vii) consolidations,mergers and transfers of all or substantially all of ProductsCorporation's assets and (viii) the issuance of additionalsubordinated debt that is senior in right of payment to the8 5/8% Senior Subordinated Notes. The8 5/8% Senior Subordinated Notes indenture alsoprohibits certain restrictions on distributions from subsidiaries. Allof these limitations and prohibitions, however, are subject to a numberof important qualifications and exceptions.

The indenture foreach of the 91⁄2% Senior Notes and the8 5/8% Senior Subordinated Notes containcustomary events of default for debt instruments of such type andincludes a cross acceleration provision which provides that it shall bean event of default under each such indenture if any debt (as definedin each such indenture) of Products Corporation or any of itssignificant subsidiaries (as defined in each such indenture) is notpaid within any applicable grace period after final maturity or isaccelerated by the holders of such debt because of a default and thetotal principal amount of the portion of such debt that is unpaid oraccelerated exceeds $25.0  million and such default continues for10 days after notice from the trustee under such indenture. If any suchevent of default occurs, the trustee under such indenture or theholders of at least 25% in principal amount of the outstandingnotes under such indenture may declare all such notes to be due andpayable immediately, provided that the holders of a majority inaggregate principal amount of the outstanding notes under suchindenture may, by notice to the trustee, waive any such default orevent of default and its consequences under such indenture. Inconnection with the Revlon Exchange Transactions, in February2004, Revlon, Inc. entered into a supplemental indenture pursuant towhich it agreed to guarantee Products Corporation’s obligationsunder the 8 5/8% Senior Subordinated Notesindenture.

2004 Consolidated MacAndrews & Forbes Line ofCredit

In July  2004, Products Corporation and MacAndrews& Forbes Inc. entered into an agreement, which effective as ofAugust  10,  2004 amended, restated and consolidated thefacilities for the MacAndrews & Forbes $65  million line ofcredit (which was undrawn at such time) and the 2004 MacAndrews &Forbes $125  million term loan (as to which after the RevlonExchange Transactions the total term loan availability was $87.0million) into a single consolidated line of credit (as amended, the‘‘2004 Consolidated MacAndrews & Forbes Line ofCredit’’). As of December  31,  2005, the 2004Consolidated MacAndrews & Forbes Line of Credit had availability of$87.0  million. The commitment under the 2004 ConsolidatedMacAndrews & Forbes Line of Credit reduced to $87.0  millionfrom $152.0  million as of July  1,  2005. InAugust  2005, the 2004 Consolidated MacAndrews & Forbes Lineof Credit was amended to provide that such line of credit is availableto assist the Company in funding its brand initiatives. See Note 20,‘‘Subsequent Events’’, regarding an extensionof the term of the 2004 Consolidated MacAndrews & Forbes Line ofCredit.

Loans are available under the 2004 ConsolidatedMacAndrews & Forbes Line of Credit if (i) the Multi-CurrencyFacility under the 2004 Credit Agreement has been substantially drawn(after taking into account anticipated needs for Local Loans (asdefined in the 2004 Credit Agreement) and letters of credit), (ii) suchborrowing is necessary to cause the excess borrowing base under theMulti-Currency Facility to remain greater than $30.0  million,(iii) additional revolving loans are not available under theMulti-Currency Facility, (iv) such borrowing is reasonably necessary toprevent or to cure a default or event of default under the 2004 CreditAgreement or (v) Products Corporation requests such loan to assist infunding the Company’s investments in its brand initiatives.

Loans under the 2004 Consolidated MacAndrews & Forbes Line ofCredit bear interest (which is not payable in cash but is capitalizedquarterly in arrears) at a rate per annum equal to the lesser of (a)12.0% and (b) 0.25% less than the rate payable from timeto time on Eurodollar loans under the Term Loan Facility under the 2004Credit Agreement, which the effective interest rate was 9.35% asof December  31,  2005, provided that at any time that theEurodollar Base Rate under the 2004 Credit Agreement is equal to orgreater than 3.0%, the applicable rate on loans under the 2004Consolidated MacAndrews 

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& Forbes Line of Credit will be equal tothe lesser of (x) 12.0% and (y) 5.25% over the EurodollarBase Rate then in effect. As of December  31,  2005, the 2004Consolidated MacAndrews & Forbes Line of Credit was undrawn.

During 1992, Revlon Holdings (as hereinafter defined) made anadvance of $25.0  million to Products Corporation, evidenced bysubordinated noninterest-bearing demand notes. The notes weresubsequently adjusted by offsets and additional amounts loaned byRevlon Holdings to Products Corporation. In March  2004, thebalance of $24.1  million was exchanged for Class A Common Stockin the Revlon Exchange Transactions as discussed below.

Theaggregate amounts of contractual long-term debt maturities atDecember  31,  2005 in the years 2006 through 2010 andthereafter are as follows:

|                         |  |                         |         |           |  |  |
|-------------------------|--|-------------------------|---------|-----------|--|--|
| Yearsended December 31, |  | Long-termdebtmaturities |
| 2006                    |  | $                       | — |      |
| 2007                    |  |                    | — |      |
| 2008                    |  |                    | 327.0   | (1)  |
| 2009                    |  |                    | — |      |
| 2010                    |  |                    | 700.0   |      |
| Thereafter              |  |                    | 390.0   | (2)  |
| Total long-term debt    |  | $                       | 1,417.0 |      |
|                         |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Amountrefers to the aggregate principal balance due on the8 5/8% Senior Subordinated Notes, which is due2008. However, the 2004 Credit Agreement requires that ProductsCorporation redeem, repurchase or defease on or before October30,  2007 the 8 5/8% Senior SubordinatedNotes such that not more than $25.0  million in aggregateprincipal amount of such notes remain outstanding. See Note 20,‘‘Subsequent Events’’. |

|     |                                                                                                                                                                                                                                                               |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Amount refers to the principalbalance due on the 91⁄2% Senior Notes. Thedifference between this amount and the carrying amount is due to theissuance of the $80.0  million Additional91⁄2% Senior Notes at a discount, priced at951⁄4% of par. |

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Revlon Exchange Transactions

InFebruary  2004, Revlon, Inc. entered into agreements with FidelityManagement & Research Co. (‘‘Fidelity’’)and MacAndrews & Forbes confirming that if Revlon, Inc. were tocommence an offer to exchange or convert certain indebtedness ofProducts Corporation and Revlon, Inc. preferred stock for Class ACommon Stock, Fidelity and MacAndrews & Forbes would tender, orcause to be tendered, certain indebtedness in the exchange. InFebruary  2004, Revlon, Inc. launched debt-for-equity exchangeoffers to exchange any and all of Products Corporation’soutstanding 8 1/8% Senior Notes, 9% SeniorNotes, and 8 5/8% Senior Subordinated Notes(collectively, the ‘‘Revlon Exchange Notes’’)for shares of Revlon, Inc.'s Class A Common Stock or, undercertain conditions, cash.

Fidelity and MacAndrews & Forbesagreed to tender the Revlon Exchange Notes at a ratio of 400 shares ofClass A Common Stock for each one thousand dollars principal of8 1/8% Senior Notes or 9% Senior Notes and300 shares of Class A Common Stock for each one thousand dollarsprincipal of 8 5/8% Senior Subordinated Notestendered for exchange. The agreements allowed Fidelity the right toelect to receive cash or additional shares of Class A Common Stock foraccrued interest on the notes tendered while MacAndrews & Forbesreceived Class A Common Stock for the accrued interest. Other holderswere offered the opportunity to exchange their Revlon Exchange Notesfor (i)  shares of Class A Common Stock at the same exchangeratios or, under certain conditions, (ii) cash up to a maximum of$150  million aggregate principal of tendered Revlon ExchangeNotes, subject to proration, at $830 per one thousand dollars principalfor the 8 1/8% Senior Notes, $800 per onethousand dollars principal for the 9% Senior Notes and $620 perone thousand dollars principal for the 8 5/8%Senior Subordinated Notes. Accrued interest was paid in cash oradditional shares of Class A Common Stock, at the holder'soption.

An aggregate of approximately $631.2  million inoutstanding notes, consisting of approximately $133.8  million of8 1/8% Senior Notes, approximately $174.5million of the 9% Senior Notes and approximately $322.9million of the 8 5/8% Senior Subordinated Noteswere exchanged, along with the related accrued interest, for anaggregate of approximately 224.1  million shares of Class A CommonStock. These amounts included approximately $1.0  million of9% Senior Notes and $286.7  million of8 5/8% Senior Subordinated Notes tendered byMacAndrews & Forbes and related entities and approximately$85.9  million of 9% Senior Notes, approximately$77.8  million of 8 1/8% Senior Notes andapproximately $32.1  million of 8 5/8%Senior Subordinated Notes tendered by funds and accounts managed byFidelity. No cash was paid for any principal amount of notesexchanged.

MacAndrews & Forbes also received Class A CommonStock for amounts outstanding as of the March  25,  2004closing date under the MacAndrews & Forbes $100  million termloan (approximately $109.7  million, including accrued interest),the 2004 MacAndrews & Forbes $125  million term loan(approximately $38.9  million, including accrued interest) andapproximately $24.1  million in subordinated promissory notes.Amounts under the MacAndrews & Forbes $100  million term loanand 2004 MacAndrews & Forbes $125  million term loan, whichexchanged at 400 shares per thousand dollars, exchanged forapproximately 43.9  million shares and 15.6  million shares,respectively. Amounts under the subordinated promissory notes, whichexchanged at 300 shares per thousand dollars, exchanged forapproximately 7.2  million shares. Portions of the 2004 MacAndrews& Forbes $125  million term loan and the MacAndrews &Forbes $65  million line of credit not exchanged remainedavailable to Products Corporation, subject to a borrowing limitation,which was subsequently eliminated. As mentioned above, the 2004MacAndrews & Forbes $125  million term loan and the MacAndrews& Forbes $65  million line of credit were consolidated intothe 2004 Consolidated MacAndrews & Forbes Line of Credit inJuly  2004.

REV Holdings LLC (‘‘REVHoldings’’), a wholly owned indirect subsidiary ofMacAndrews & Forbes Holdings, owned all 546 shares of Revlon,Inc.'s outstanding Series A preferred stock with a par value of$0.01 per share and a liquidation preference of $54.6  million(‘‘Revlon, Inc. Series A Preferred Stock’’) andall 4,333 shares of Revlon, Inc.'s outstanding Series Bconvertible preferred stock, with a par value of $0.01 per share(‘‘Revlon, Inc. Series B Preferred Stock’’) andwhich were convertible into 433,333 shares of Class A Common Stock. Aspart of the Revlon Exchange Transactions, REV Holdings exchanged each$1,000 of liquidation preference of Revlon, Inc. Series A PreferredStock for 160 shares of Class A Common Stock for an aggregate ofapproximately 8.7  million shares of Class A Common Stock andconverted its shares of Revlon, Inc. Series B Preferred Stock into anaggregate of 433,333 shares of Class A Common Stock.

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The consummation of the Revlon ExchangeTransactions on March  25,  2004 resulted in (i) thereduction of debt, preferred stock and accrued interest ofapproximately $804  million (as of such date), $54.6  millionand $9.9  million, respectively, resulting from the issuance of299,969,493 shares of Class A Common Stock and (ii) resulted in adecrease to capital deficiency of $879.3  million, including$79.9  million as a result of the exchange or conversion of debtand preferred stock by MacAndrews & Forbes, calculated as thedifference between the market value on March  25,  2004 ofthe Class A Common Stock issued and the principal amount of debt andpreferred stock exchanged or converted, together with accrued interest.Additionally, the Company recognized a loss on early extinguishment ofdebt of $32.0  million for the write-off of unamortized debtissuance costs and debt discount, estimated fees and expenses and thedifference between the market value on March  25,  2004 ofthe shares of Class A Common Stock issued and the principal amount ofdebt exchanged by third parties (other than by MacAndrews &Forbes), together with accrued interest, of $15.5  million.

In February  2004, Revlon, Inc. and Fidelity also entered intoa stockholders agreement (the ‘‘StockholdersAgreement’’) pursuant to which, among other things, (i)Revlon, Inc. agreed to continue to maintain a majority of independentdirectors (as defined by New York Stock Exchange listing standards) onits Board of Directors, as it currently does; (ii) Revlon, Inc. wouldestablish and maintain a Nominating and Corporate Governance Committeeof the Board of Directors, which it formed in March  2004; and(iii) Revlon, Inc. agreed to certain restrictions with respect toRevlon, Inc.’s conducting any business or entering into anytransactions or series of related transactions with any of itsaffiliates, any holders of 10% or more of the outstanding votingstock or any affiliates of such holders (in each case, other than itssubsidiaries). This Stockholders Agreement will terminate when Fidelityceases to be the beneficial holder of at least 5% of Revlon,Inc.'s outstanding voting stock.

Also in February2004, Revlon, Inc. and MacAndrews & Forbes also entered into aninvestment agreement (as amended, the ‘‘2004 InvestmentAgreement’’) pursuant to which MacAndrews and Forbescommitted to assisting the Company with its goal of reducing ProductsCorporation's indebtedness by an additional $200  million inthe aggregate by the end of 2004 and further by an additional$100  million in the aggregate by March  2006. Pursuant tothe 2004 Investment Agreement, MacAndrews & Forbes agreed, amongother things, (i) to the extent that a minimum of $150  millionaggregate principal amount of notes were not tendered in the RevlonExchange Transaction, to back-stop the exchange offers by subscribingfor additional shares of Revlon, Inc.'s Class A Common Stock at apurchase price of $2.50 per share, to the extent of any shortfall, theproceeds of which would be used to reduce Products Corporation'soutstanding indebtedness; (ii) to back-stop a rights offering in anamount necessary to meet the $200  million aggregate debtreduction target by December  31,  2004, not to exceed$50  million since at least $150  million of debt reductionin the aggregate was ensured as a result of the MacAndrews & Forbesback-stop obligations discussed in (i)  above; and (iii) toback-stop an equity or rights offering in an amount necessary to meetthe $300  million aggregate debt reduction target by March31,  2006, not to exceed $100  million since at least$200  million of debt reduction in the aggregate is ensured as aresult of the back-stop obligations discussed in (i) and (ii) above(such equity offerings together with the Revlon Exchange Transactionsare the ‘‘Debt Reduction Transactions’’). Inconnection with the closing of the Revlon Exchange Transactions onMarch  25,  2004, MacAndrews & Forbes Holdings executed ajoinder agreement to the Revlon, Inc. registration rights agreementpursuant to which all Class A Common Stock acquired by MacAndrews &Forbes will be deemed to be registrable securities. In August2005, in connection with Revlon, Inc.’s plan to issue$185.0  million of equity, MacAndrews & Forbes and Revlon,Inc. amended the 2004 Investment Agreement to increase MacAndrews &Forbes' commitment to purchase such equity as is necessary toensure that Revlon, Inc. issues $185.0  million of equity. (SeeNote 20, ‘‘Subsequent Events’’).

Inconnection with consummating the Revlon Exchange Transactions, Revlon,Inc. announced that its previously - announced plan to launch a rightsoffering and use the proceeds to reduce debt by a further $50million by year-end 2004 was reduced to $9.7  million, as a resultof $190.3  million of Revlon Exchange Notes having been exchangedin excess of the Revlon Exchange Notes committed to be exchanged byMacAndrews & Forbes and Fidelity under their respective supportagreements. This $190.3  million more than satisfied Revlon,Inc.'s plan to reduce debt through the Revlon Exchange Offers (ashereinafter defined) by $150  million in addition to the RevlonExchange Notes that were committed to be exchanged 

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in the support agreements with MacAndrews& Forbes and Fidelity. The $40.3  million difference satisfiedall but $9.7  million of the Company's plan to reduce debt(in addition to the Revlon Exchange Notes) by a further $50million by year-end 2004. Because the costs and expenses, as well asthe use of organizational resources, associated with a $9.7million rights offering would have been unduly disproportionate,Revlon, Inc.'s support agreements with MacAndrews & Forbes andFidelity and the 2004 Investment Agreement relating to theCompany's debt reduction plan were amended to enable Revlon, Inc.to satisfy the remaining $9.7  million of debt reduction as partof the final stage of the Company's debt reduction plan.Consistent with agreements between MacAndrews & Forbes and Revlon,Inc. entered into contemporaneously with the agreements relating to theRevlon Exchange Transactions, MacAndrews & Forbes agreed toback-stop the proposed equity issuance. See Note 20,‘‘Subsequent Events’’.

LiquidityConsiderations

The Company expects that operating revenues,cash on hand, the net cash proceeds from Revlon, Inc.’s planned$75  million equity issuance described in Note 20,‘‘Subsequent Events’’ and funds available forborrowing under the 2004 Credit Agreement, the 2004 ConsolidatedMacAndrews & Forbes Line of Credit and other permitted lines ofcredit will be sufficient to enable the Company to cover its operatingexpenses for 2006, including cash requirements in connection with theCompany’s operations, the continued implementation of, andrefinement to, the Company’s plan, cash requirements inconnection with the Company’s restructuring programs referred toabove (including as described in Note 20, ‘‘SubsequentEvents’’), the Company’s debt service requirementsand regularly scheduled pension and post-retirement plan contributions.However, there can be no assurance that such funds will be sufficientto meet the Company’s cash requirements on a consolidated basis.If the Company’s anticipated level of revenue growth is notachieved because, for example, of decreased consumer spending inresponse to weak economic conditions or weakness in the mass-marketcosmetics category, adverse changes in currency, increased competitionfrom the Company’s competitors, changes in consumer purchasinghabits, including with respect to shopping channels, retailer inventorymanagement or the Company’s advertising and marketing plans orbrand initiatives are not as successful as anticipated, or if theCompany’s expenses associated with the continued implementationof, and refinement to, the Company’s plan exceed the anticipatedlevel of expenses, the Company’s current sources of funds may beinsufficient to meet the Company’s cash requirements.

Inthe event of a decrease in demand for the Company's products,reduced sales, lack of increases in demand and sales, changes inconsumer purchasing habits, including with respect to shoppingchannels, retailer inventory management and/or increased returns orexpenses associated with the continued implementation of, andrefinement to, the Company's plan exceeding its expectations, anysuch development, if significant, could reduce ProductsCorporation's revenues and could adversely affect ProductsCorporation's ability to comply with certain financial covenantsunder the 2004 Credit Agreement and in such event the Company could berequired to take measures, including reducing discretionaryspending.

If the Company is unable to satisfy its cashrequirements from the sources identified above or comply with its debtcovenants, the Company could be required to adopt one or morealternatives, such as delaying the implementation of or revisingaspects of its plan, including reducing or delaying purchases of walldisplays or advertising or promotional expenses, reducing or delayingcapital spending, delaying, reducing or revising restructuring programs(including as described in Note 20, ‘‘SubsequentEvents’’), restructuring indebtedness, selling assets oroperations, seeking additional capital contributions or loans fromMacAndrews & Forbes, the Company's other affiliates and/orthird parties, selling additional equity securities of Revlon, Inc. (ordebt securities of Products Corporation) or reducing otherdiscretionary spending. There can be no assurance that the Companywould be able to take any of the actions referred to above because of avariety of commercial or market factors or constraints in ProductsCorporation's debt instruments, including, for example, marketconditions being unfavorable for an equity or debt issuance, additionalcapital contributions or loans not being available from affiliatesand/or third parties, or that the transactions may not be permittedunder the terms of Products Corporation's various debt instrumentsthen in effect, because of restrictions on the incurrence of debt,incurrence of liens, asset dispositions and related party transactions.In addition, such actions, if taken, may not enable the 

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Company to satisfy its cash requirements orenable Products Corporation to comply with its debt covenants if theactions do not generate a sufficient amount of additional capital.

Revlon, Inc., as a holding company, will be dependent on theearnings and cash flow of, and dividends and distributions from,Products Corporation to pay its expenses and to pay any cash dividendor distribution on Revlon, Inc.'s Class A Common Stock that may beauthorized by Revlon, Inc.’s Board of Directors. The terms ofthe 2004 Credit Agreement, the 2004 Consolidated MacAndrews &Forbes Line of Credit and the indentures governing the91⁄2% Senior Notes and the8 5/8% Senior Subordinated Notes generallyrestrict Products Corporation from paying dividends or makingdistributions, except that Products Corporation is permitted to paydividends and make distributions to Revlon, Inc. to enable Revlon,Inc., among other things, to pay expenses incidental to being a publicholding company, including, among other things, professional fees suchas legal and accounting fees, regulatory fees such as SEC filing feesand other miscellaneous expenses related to being a public holdingcompany and, subject to certain limitations, to pay dividends or makedistributions in certain circumstances to finance the purchase byRevlon, Inc. of its Class A Common Stock in connection with thedelivery of such Class A Common Stock to grantees under the Amended andRestated Revlon, Inc. Stock Plan (the ‘‘StockPlan’’).

10.    FINANCIALINSTRUMENTS

The fair value of the Company'slong-term debt is based on the quoted market prices for the same issuesor on the current rates offered to the Company for debt of the sameremaining maturities. The estimated fair value of long-term debt atDecember  31,  2005 and 2004, respectively, was approximately$40.0  million and $38.3  million less than the carryingvalues of $1,413.4  million and $1,318.7  million,respectively.

Products Corporation also maintains standby andtrade letters of credit with certain banks for various corporatepurposes under which Products Corporation is obligated, of whichapproximately $16.0  million and $17.0  million (includingamounts available under credit agreements in effect at that time) weremaintained at December  31,  2005 and 2004, respectively.Included in these amounts is approximately $11.9  million and$11.0  million, at December  31,  2005 and 2004,respectively, in standby letters of credit, which support ProductsCorporation's self-insurance programs. The estimated liabilityunder such programs is accrued by Products Corporation.

Thecarrying amounts of cash and cash equivalents, marketable securities,trade receivables, notes receivable, accounts payable and short-termborrowings approximate their fair values.

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11.    INCOMETAXES

The Company's loss before incometaxes and the applicable provision (benefit) for income taxes are asfollows:

|                                         |  |                        |        |         |  |        |        |         |  |        |        |         |  |  |
|-----------------------------------------|--|------------------------|--------|---------|--|--------|--------|---------|--|--------|--------|---------|--|--|
|                                    |  | Year Ended December31, |
|                                    |  | **2005**               |        | 2004    |  | 2003   |
| Loss before incometaxes:                |  |                   |   |    |  |   |   |    |  |   |   |    |
| Domestic                                |  | $                      | (97.2  | )  |  | $      | (165.8 | )  |  | $      | (136.5 | )  |
| Foreign                                 |  |                   | 22.0   |    |  |   | 32.6   |    |  |   | (16.8  | )  |
|                                    |  | $                      | (75.2  | )  |  | $      | (133.2 | )  |  | $      | (153.3 | )  |
| Provision (benefit) forincome taxes:    |  |                   |   |    |  |   |   |    |  |   |   |    |
| Federal                                 |  | $                      | 0.1    |    |  | $      | (1.7   | )  |  | $      | (4.4   | )  |
| State and local                         |  |                   | 0.4    |    |  |   | (0.8   | )  |  |   | 0.4    |    |
| Foreign                                 |  |                   | 8.0    |    |  |   | 11.8   |    |  |   | 4.5    |    |
|                                    |  | $                      | 8.5    |    |  | $      | 9.3    |    |  | $      | 0.5    |    |
| Current                                 |  | $                      | 15.2   |    |  | $      | 12.6   |    |  | $      | 8.3    |    |
| Deferred                                |  |                   | 0.1    |    |  |   | 1.6    |    |  |   | 1.9    |    |
| Benefits ofoperating loss carryforwards |  |                   | (3.0   | )  |  |   | (2.0   | )  |  |   | (1.9   | )  |
| Resolution of tax matters               |  |                   | (3.8   | )  |  |   | (2.9   | )  |  |   | (7.8   | )  |
|                                    |  | $                      | 8.5    |    |  | $      | 9.3    |    |  | $      | 0.5    |    |
|                                         |

The effective tax rate on lossbefore income taxes is reconciled to the applicable statutory federalincome tax rate as follows:

|                                                                         |  |                        |         |          |  |        |         |          |  |        |         |          |  |  |
|-------------------------------------------------------------------------|--|------------------------|---------|----------|--|--------|---------|----------|--|--------|---------|----------|--|--|
|                                                                    |  | Year Ended December31, |
|                                                                    |  | 2005                   |         | 2004     |  | 2003   |
| Statutory federal income taxrate                                        |  |                   | (35.0   | )%  |  |   | (35.0   | )%  |  |   | (35.0   | )%  |
| State and local taxes, net offederal income tax benefit                 |  |                   | 0.4     |     |  |   | 0.2     |     |  |   | 0.2     |     |
| Foreign and U.S. tax effects attributableto operations outside the U.S. |  |                   | 14.4    |     |  |   | (4.5    | )   |  |   | 2.1     |     |
| Loss on early extinguishment of debt                                    |  |                   | — |     |  |   | (14.9   | )   |  |   | — |     |
| Changein valuation allowance                                            |  |                   | 36.8    |     |  |   | 61.5    |     |  |   | 38.1    |     |
| Sale of businesses                                                      |  |                   | — |     |  |   | — |     |  |   | — |     |
| Resolution of taxaudits                                                 |  |                   | (5.2    | )   |  |   | (2.2    | )   |  |   | (5.1    | )   |
| Other                                                                   |  |                   | (0.2    | )   |  |   | 1.8     |     |  |   | — |     |
| Effective rate                                                          |  |                   | 11.2    | %   |  |   | 6.9     | %   |  |   | 0.3     | %   |
|                                                                         |

F-28

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The tax effects of temporary differencesthat give rise to significant portions of the deferred tax assets anddeferred tax liabilities at December  31,  2005 and 2004 arepresented below:

|                                                                |  |             |        |         |  |        |        |         |  |  |
|----------------------------------------------------------------|--|-------------|--------|---------|--|--------|--------|---------|--|--|
|                                                           |  | December31, |
|                                                           |  | 2005        |        | 2004    |
| Deferred taxassets:                                            |  |        |   |    |  |   |   |    |
| Accounts receivable, principallydue to doubtful accounts       |  | $           | 1.3    |    |  | $      | 1.5    |    |
| Inventories                                                    |  |        | 13.6   |    |  |   | 13.0   |    |
| Net operating loss carryforwards - domestic                    |  |        | 182.6  |    |  |   | 176.8  |    |
| Net operating losscarryforwards - foreign                      |  |        | 122.9  |    |  |   | 135.4  |    |
| Accruals and related reserves                                  |  |        | 1.4    |    |  |   | 4.4    |    |
| Employee benefits                                              |  |        | 63.0   |    |  |   | 67.1   |    |
| State and local taxes                                          |  |        | 7.6    |    |  |   | 7.6    |    |
| Advertising, sales discounts and returnsand coupon redemptions |  |        | 50.3   |    |  |   | 36.2   |    |
| Other                                                          |  |        | 34.2   |    |  |   | 29.7   |    |
| Total gross deferred tax assets                                |  |        | 476.9  |    |  |   | 471.7  |    |
| Less valuationallowance                                        |  |        | (447.2 | )  |  |   | (441.7 | )  |
| Total deferred tax assets, net ofvaluation allowance           |  |        | 29.7   |    |  |   | 30.0   |    |
| Deferred taxliabilities:                                       |  |        |   |    |  |   |   |    |
| Plant, equipment and otherassets                               |  |        | (24.2  | )  |  |   | (23.5  | )  |
| Other                                                          |  |        | (1.6   | )  |  |   | (2.1   | )  |
| Totalgross deferred tax liabilities                            |  |        | (25.8  | )  |  |   | (25.6  | )  |
| Net deferred tax assets                                        |  | $           | 3.9    |    |  | $      | 4.4    |    |
|                                                                |

Inassessing the recoverability of its deferred tax assets, managementconsiders whether it is more likely than not that some portion or allof the deferred tax assets will not be realized. The ultimaterealization of deferred tax assets is dependent upon the generation offuture taxable income during the periods in which those temporarydifferences become deductible. Management considers the scheduledreversal of deferred tax liabilities, projected future taxable income,and tax planning strategies in making this assessment. Based upon thelevel of historical taxable income for certain international marketsand projections for future taxable income over the periods in which thedeferred tax assets are deductible, management believes it is morelikely than not that the Company will realize the benefits of certaindeductible differences existing at December  31,  2005. Thevaluation allowance increased by $5.5  million during 2005 anddecreased by $186.3  million during 2004.

During 2005, 2004and 2003, certain of the Company's foreign subsidiaries usedoperating loss carryforwards to credit the current provision for incometaxes by $1.1  million, $2.0  million, and $1.9million, respectively. Certain other foreign operations generatedlosses during 2005, 2004 and 2003 for which the potential tax benefitwas reduced by a valuation allowance. During 2005 the Company useddomestic operating loss carryforwards to credit the current provisionfor income taxes by $1.9  million. At December  31,2005, the Company had tax loss carryforwards of approximately$916.4  million of which $394.6  million are foreign and$521.8  million are domestic. Of the domestic losses, $111.4million represent tax losses generated by the Company from March26,  2004 to December  31,  2004, and $410.4million represent losses of the Company not absorbed by the MacAndrews& Forbes Group in accordance with the Internal Revenue Code of 1986(as amended, the "Code") and the Treasuryregulations issued thereunder, offset by losses used by the Company in2005. The losses expire in future years as follows: 2006-$51.8million; 2007-$119.1  million; 2008-$182.8  million;2009-$88.1  million; 2010 and beyond−$219.9 million; andunlimited−$254.7 million. The Company could receive the benefitof such tax loss carryforwards only to the extent it has taxable incomeduring the carryforward periods in the applicable tax jurisdictions. Asa result of the closing of the Revlon Exchange Transactions, as of theend of the day on March  25,  2004, Revlon Inc., ProductsCorporation and its U.S. subsidiaries were no longer included in theMacAndrews & Forbes Group for federal income tax purposes (seefurther discussion immediately below). The Code and the Treasuryregulations issued thereunder govern both the 

F-29

----

calculation of the amount and allocation tothe members of the MacAndrews & Forbes Group of any consolidatedfederal net operating losses (‘‘CNOLs’’) of thegroup that will be available to offset Revlon, Inc.’s taxableincome and the taxable income of its U.S. subsidiaries, includingProducts Corporation, for the taxable years beginning after March25,  2004. Only the amount of any CNOLs that the MacAndrews &Forbes Group did not absorb by December  31,  2004 will beavailable to be allocated to Revlon, Inc. and its U.S. subsidiaries,including Products Corporation, for their taxable years beginning onMarch  26,  2004. MacAndrews & Forbes Holdings hasindicated that, after giving effect to the CNOLs that the MacAndrews& Forbes Group reported as having absorbed on its 2004 consolidatedfederal income tax return, $415.9  million in U.S. federal netoperating losses and $15.2  million of alternative minimum taxlosses were available to Revlon, Inc. and its U.S. subsidiaries,including Products Corporation, after March  25,  2004. Theseamounts are subject to change if the Internal Revenue Service adjuststhe results of the MacAndrews & Forbes Group or if the MacAndrews& Forbes Group amends its returns for the tax years ended on orbefore December  31,  2004. Any losses that Revlon, Inc. andits U.S. subsidiaries, including Products Corporation, generate afterMarch  25,  2004 will be available to Revlon, Inc. for itsuse and its U.S. subsidiaries', including ProductsCorporation’s, use and will not be available for the use of theMacAndrews & Forbes Group.

The Company has not provided forU.S. Federal and foreign withholding taxes on $44.9  million offoreign subsidiaries' undistributed earnings as of December31,  2005, because such earnings are intended to be indefinitelyreinvested overseas. The amount of unrecognized deferred taxliabilities for temporary differences related to investments inundistributed earnings is not practicable to determine at thistime.

As a result of the closing of the Revlon ExchangeTransactions, as of the end of March  25,  2004, Revlon,Inc., Products Corporation and their U.S. subsidiaries were no longerincluded in the MacAndrews & Forbes Group for federal income taxpurposes. The MacAndrews & Forbes Tax Sharing Agreement (ashereinafter defined) will remain in effect solely for taxable periodsbeginning on or after January  1,  1992, through andincluding March  25,  2004. In these taxable periods, Revlon,Inc. and Products Corporation were included in the MacAndrews &Forbes Group, and Revlon, Inc.'s and Products Corporation'sfederal taxable income and loss were included in such group'sconsolidated tax return filed by MacAndrews & Forbes Holdings.Revlon, Inc. and Products Corporation were also included in certainstate and local tax returns of MacAndrews & Forbes Holdings or itssubsidiaries. In June  1992, Revlon Holdings, Revlon, Inc.,Products Corporation and certain of its subsidiaries, and MacAndrews& Forbes Holdings entered into a tax sharing agreement (assubsequently amended and restated, the ‘‘MacAndrews &Forbes Tax Sharing Agreement’’), pursuant to whichMacAndrews & Forbes Holdings agreed to indemnify Revlon, Inc. andProducts Corporation against federal, state or local income taxliabilities of the MacAndrews & Forbes Group (other than in respectof Revlon, Inc. and Products Corporation) for taxable periods beginningon or after January  1,  1992 during which Revlon, Inc. andProducts Corporation or a subsidiary of Products Corporation was amember of such group. Pursuant to the MacAndrews & Forbes TaxSharing Agreement, for all such taxable periods, Products Corporationwas required to pay to Revlon, Inc., which in turn was required to payto Revlon Holdings, amounts equal to the taxes that ProductsCorporation would otherwise have had to pay if it were to file separatefederal, state or local income tax returns (including any amountsdetermined to be due as a result of a redetermination arising from anaudit or otherwise of the consolidated or combined tax liabilityrelating to any such period which was attributable to ProductsCorporation), except that Products Corporation was not entitled tocarry back any losses to taxable periods ending prior to January1,  1992. No payments were required by Products Corporation orRevlon, Inc. if and to the extent Products Corporation was prohibitedunder the terms of its 2004 Credit Agreement from making tax sharingpayments to Revlon, Inc. The 2004 Credit Agreement prohibits ProductsCorporation from making such tax sharing payments under the MacAndrews& Forbes Tax Sharing Agreement other than in respect of state,local and federal taxes. The MacAndrews & Forbes Tax SharingAgreement was amended, effective as of January  1,  2001, toeliminate a contingent payment to Revlon, Inc. under certaincircumstances in return for a $10  million note by MacAndrews& Forbes Holdings, with interest at 12% and interest andprincipal payable in December  2005, which was paid in full. As aresult of tax net operating losses, there were no federal tax paymentsor payments in lieu of taxes pursuant to the MacAndrews & ForbesTax Sharing Agreement in respect of 2004.

F-30

----

Following the closing of the RevlonExchange Transactions, Revlon, Inc. became the parent of a newconsolidated group for federal income tax purposes and ProductsCorporation's federal taxable income and loss will be included insuch group's consolidated tax returns. Accordingly, Revlon, Inc.and Products Corporation entered into a tax sharing agreement (the‘‘Revlon Tax Sharing Agreement’’) pursuant towhich Products Corporation will be required to pay to Revlon, Inc.amounts equal to the taxes that Products Corporation would otherwisehave had to pay if Products Corporation were to file separate federal,state or local income tax returns, limited to the amount, and payableonly at such times, as Revlon, Inc. will be required to make paymentsto the applicable taxing authorities. The 2004 Credit Agreement doesnot prohibit payments from Products Corporation to Revlon, Inc. to theextent required under the Revlon Tax Sharing Agreement. As a result oftax net operating losses, there were no federal tax payments orpayments in lieu of taxes from Products Corporation to Revlon, Inc.pursuant to the Revlon Tax Sharing Agreement in respect of 2004. TheCompany expects that there will be federal alternative minimum taxpayments of $0.1  million from Products Corporation to Revlon,Inc. pursuant to the Revlon Tax Sharing Agreement in respect of2005.

Pursuant to the asset transfer agreement referred to inNote 16, Products Corporation assumed all tax liabilities of RevlonHoldings other than (i) certain income tax liabilities arising prior toJanuary  1,  1992 to the extent such liabilities exceededreserves on Revlon Holdings' books as of January  1,1992 or were not of the nature reserved for and (ii) other taxliabilities to the extent such liabilities are related to the businessand assets retained by Revlon Holdings. During the second quarter of2003, the Company resolved various tax audits, which resulted in a taxbenefit of $13.9  million, of which $6.9  million wasrecorded directly to capital deficiency since it relates to liabilitiesassumed by Products Corporation in connection with the transferagreements related to Products Corporation's formation in 1992(see Note 16, ‘‘Related Party Transactions’’).During 2004, the Company resolved various state and federal tax auditsand determined that certain tax liabilities were no longer probable,which resulted in a tax benefit of $19.3  million, of which$16.4  million was recorded to capital deficiency since it relatesto liabilities assumed by Products Corporation in connection with thetransfer agreements related to Products Corporation's formation in1992 (see Note 16, ‘‘Related PartyTransactions’’). During 2005, the Company resolved varioustax matters and determined certain tax liabilities were no longerprobable, which resulted in a tax benefit of $3.8  million, noneof which was recorded to capital deficiency. In the normal course ofbusiness the Company is subject to tax examinations in both domesticand foreign jurisdictions. The Company believes that adequateprovisions have been made for adjustments that may result from such taxexaminations.

12.    SAVINGS PLAN, PENSION ANDPOST-RETIREMENT BENEFITS

Savings Plan:

The Company offers a qualified defined contribution plan forU.S.-based employees, the Revlon Employees' Savings, Investmentand Profit Sharing Plan (as amended, the ‘‘SavingsPlan’’), which allows eligible participants to contributeup to 25% and highly compensated employees to contribute up to6% of qualified compensation through payroll deductions. TheCompany matches employee contributions at fifty cents for each dollarcontributed up to the first 6% of eligible compensation. TheCompany may also contribute from time to time profit sharingcontributions (if any) for non-bonus eligible employees. In 2005, 2004and 2003, the Company made cash matching contributions to the SavingsPlan of approximately $2.9  million, $2.7  million and$2.8  million, respectively. There were no additionalcontributions or profit sharing contributions made during thoseyears.

Pension Benefits:

The Company sponsors anumber of qualified defined benefit pension plans covering asubstantial portion of the Company's employees in the U.S., aswell as certain other non-U.S. employees. The Company also hasnonqualified pension plans which provide benefits in excess of IRSlimitations in the U.S. and in certain limited cases contractualbenefits for designated officers of the Company. These plans are fundedfrom the general assets of the Company.

F-31

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Other Post-retirementBenefits:

The Company previously sponsored an unfundedretiree benefit plan, which provides death benefits payable tobeneficiaries of a very limited number of former employees.Participation in this plan was limited to participants enrolled as ofDecember  31,  1993. The Company also administers an unfundedmedical insurance plan on behalf of Revlon Holdings, the cost of whichhas been apportioned to Revlon Holdings under the reimbursementagreements among Revlon, Inc., Products Corporation and MacAndrews& Forbes. (See Note 16, ‘‘Related Party Transactions— Reimbursement Agreements’’).

The Companyuses September  30 as its measurement date for pension and otherpost-retirement plans obligations and assets.

Informationregarding the Company's significant pension and otherpost-retirement plans at the dates indicated is as follows:

|                                                                |  |               |         |                                   |  |        |         |         |  |        |         |         |  |        |         |         |  |  |
|----------------------------------------------------------------|--|---------------|---------|-----------------------------------|--|--------|---------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                                           |  | Pension Plans |         | OtherPost-retirementBenefit Plans |
|                                                           |  | 2005          |         | 2004                              |  | 2005   |         | 2004    |
| Change in BenefitObligation:                                   |  |          |    |                              |  |   |    |    |  |   |    |    |  |   |    |    |
| Benefitobligation – September  30 of prior year          |  | $             | (557.8  | )                            |  | $      | (518.2  | )  |  | $      | (13.0   | )  |  | $      | (17.1   | )  |
| Service cost                                                   |  |          | (9.6    | )                            |  |   | (9.9    | )  |  |   | (0.1    | )  |  |   | (0.1    | )  |
| Interestcost                                                   |  |          | (31.0   | )                            |  |   | (30.6   | )  |  |   | (0.9    | )  |  |   | (0.8    | )  |
| Plan amendments                                                |  |          | — |                              |  |   | — |    |  |   | (0.5    | )  |  |   | 4.2     |    |
| Actuarialloss                                                  |  |          | (20.3   | )                            |  |   | (21.8   | )  |  |   | — |    |  |   | (0.1    | )  |
| Benefits paid                                                  |  |          | 27.5    |                              |  |   | 26.6    |    |  |   | 1.1     |    |  |   | 1.0     |    |
| Foreignexchange                                                |  |          | 4.9     |                              |  |   | (3.6    | )  |  |   | 0.2     |    |  |   | — |    |
| Plan participant contributions                                 |  |          | (0.2    | )                            |  |   | (0.3    | )  |  |   | — |    |  |   | — |    |
| Benefit obligation –September  30 of current year        |  |          | (586.5  | )                            |  |   | (557.8  | )  |  |   | (13.2   | )  |  |   | (12.9   | )  |
| Change in PlanAssets:                                          |  |          |    |                              |  |   |    |    |  |   |    |    |  |   |    |    |
| Fair value of planassets – September  30 of prior year   |  |          | 341.5   |                              |  |   | 298.6   |    |  |   | — |    |  |   | — |    |
| Actualreturn (loss) on plan assets.                            |  |          | 44.0    |                              |  |   | 36.6    |    |  |   | — |    |  |   | — |    |
| Employercontributions                                          |  |          | 27.5    |                              |  |   | 30.3    |    |  |   | 1.1     |    |  |   | 1.0     |    |
| Plan participant contributions                                 |  |          | 0.2     |                              |  |   | 0.3     |    |  |   | — |    |  |   | — |    |
| Benefits paid                                                  |  |          | (27.2   | )                            |  |   | (26.5   | )  |  |   | (1.1    | )  |  |   | (1.0    | )  |
| Foreign exchange                                               |  |          | (3.0    | )                            |  |   | 2.2     |    |  |   | — |    |  |   | — |    |
| Fair value of plan assets –September  30 of current year |  |          | 383.0   |                              |  |   | 341.5   |    |  |   | — |    |  |   | — |    |
| Funded status ofplans                                          |  |          | (203.5  | )                            |  |   | (216.3  | )  |  |   | (13.2   | )  |  |   | (12.9   | )  |
| Amounts contributed to plans duringfourth quarter              |  |          | 2.3     |                              |  |   | 4.3     |    |  |   | 0.2     |    |  |   | 0.2     |    |
| Unrecognized net loss                                          |  |          | 130.0   |                              |  |   | 135.1   |    |  |   | 1.6     |    |  |   | 1.5     |    |
| Unrecognizedprior service cost                                 |  |          | (3.6    | )                            |  |   | (4.1    | )  |  |   | — |    |  |   | — |    |
| Accrued net periodic benefit cost at December31,               |  | $             | (74.8   | )                            |  | $      | (81.0   | )  |  | $      | (11.4   | )  |  | $      | (11.2   | )  |
|                                                                |

F-32

----

|                                                                 |  |               |        |                                   |  |        |        |         |  |        |         |         |  |        |         |         |  |  |
|-----------------------------------------------------------------|--|---------------|--------|-----------------------------------|--|--------|--------|---------|--|--------|---------|---------|--|--------|---------|---------|--|--|
|                                                            |  | Pension Plans |        | OtherPost-retirementBenefit Plans |
|                                                            |  | December  31, |
|                                                            |  | 2005          |        | 2004                              |  | 2005   |        | 2004    |
| Amounts recognized in theConsolidated Balance Sheets consistof: |  |          |   |                              |  |   |   |    |  |   |    |    |  |   |    |    |
| Prepaid expenses                                                |  | $             | 6.2    |                              |  | $      | 6.8    |    |  | $      | — |    |  | $      | — |    |
| Accrued expenses                                                |  |          | (31.6  | )                            |  |   | (23.3  | )  |  |   | — |    |  |   | — |    |
| Other long-termliabilities                                      |  |          | (157.2 | )                            |  |   | (179.0 | )  |  |   | (11.4   | )  |  |   | (11.2   | )  |
| Intangible asset                                                |  |          | 0.2    |                              |  |   | 0.3    |    |  |   | — |    |  |   | — |    |
| Accumulated other comprehensive loss                            |  |          | 107.0  |                              |  |   | 113.7  |    |  |   | — |    |  |   | — |    |
| Otherlong-term assets                                           |  |          | 0.6    |                              |  |   | 0.5    |    |  |   | — |    |  |   | — |    |
|                                                            |  | $             | (74.8  | )                            |  | $      | (81.0  | )  |  | $      | (11.4   | )  |  | $      | (11.2   | )  |
|                                                                 |

With respect to theabove accrued net periodic benefit costs, the Company has recorded areceivable from affiliates of $1.9  million and $1.3  millionat December  31,  2005 and 2004, respectively, relating toRevlon Holdings' participation in the Company's pension plansand $1.0  million and $1.1  million at December31,  2005 and 2004, respectively, for other post-retirement netperiodic benefits costs attributable to Revlon Holdings.

Wherethe accumulated benefit obligation exceeded the related fair value ofplan assets, the projected benefit obligation, accumulated benefitobligation, and fair value of plan assets for the Company'spension plans are as follows:

|                                |  |               |       |        |  |        |       |        |  |        |       |        |  |  |
|--------------------------------|--|---------------|-------|--------|--|--------|-------|--------|--|--------|-------|--------|--|--|
|                           |  | September 30, |
|                           |  | 2005          |       | 2004   |  | 2003   |
| Projected benefit obligation   |  | $             | 586.5 |   |  | $      | 557.8 |   |  | $      | 518.2 |   |
| Accumulated benefit obligation |  |          | 567.6 |   |  |   | 541.0 |   |  |   | 502.4 |   |
| Fair value of planassets       |  |          | 383.0 |   |  |   | 341.5 |   |  |   | 298.6 |   |
|                                |

The components of net periodic benefitcost for the plans are as follows:

|                                      |  |                         |         |                                   |  |        |       |         |  |        |       |         |  |        |         |        |  |        |         |        |  |        |         |         |  |  |
|--------------------------------------|--|-------------------------|---------|-----------------------------------|--|--------|-------|---------|--|--------|-------|---------|--|--------|---------|--------|--|--------|---------|--------|--|--------|---------|---------|--|--|
|                                 |  | Pension Plans           |         | OtherPost-retirementBenefit Plans |
|                                 |  | Years Ended December31, |
|                                 |  | 2005                    |         | 2004                              |  | 2003   |       | 2005    |  | 2004   |       | 2003    |
| Service cost                         |  | $                       | 9.6     |                              |  | $      | 9.9   |    |  | $      | 11.8  |    |  | $      | 0.1     |   |  | $      | 0.1     |   |  | $      | 0.3     |    |
| Interest cost                        |  |                    | 31.0    |                              |  |   | 30.6  |    |  |   | 29.2  |    |  |   | 0.9     |   |  |   | 0.8     |   |  |   | 1.0     |    |
| Expected return on plan assets       |  |                    | (28.3   | )                            |  |   | (24.7 | )  |  |   | (21.3 | )  |  |   | — |   |  |   | — |   |  |   | — |    |
| Amortization of priorservice cost    |  |                    | (0.6    | )                            |  |   | (0.6  | )  |  |   | (0.8  | )  |  |   | — |   |  |   | — |   |  |   | — |    |
| Amortization of net transition asset |  |                    | — |                              |  |   | (0.1  | )  |  |   | (0.1  | )  |  |   | — |   |  |   | — |   |  |   | — |    |
| Amortization of actuarial loss(gain) |  |                    | 7.4     |                              |  |   | 9.6   |    |  |   | 9.5   |    |  |   | 0.1     |   |  |   | — |   |  |   | (0.1    | )  |
|                                 |  |                    | 19.1    |                              |  |   | 24.7  |    |  |   | 28.3  |    |  |   | 1.1     |   |  |   | 0.9     |   |  |   | 1.2     |    |
| Portion allocated to RevlonHoldings  |  |                    | (0.1    | )                            |  |   | (0.1  | )  |  |   | (0.3  | )  |  |   | — |   |  |   | — |   |  |   | — |    |
|                                 |  | $                       | 19.0    |                              |  | $      | 24.6  |    |  | $      | 28.0  |    |  | $      | 1.1     |   |  | $      | 0.9     |   |  | $      | 1.2     |    |
|                                      |

The Company recognized $3.3  millionof income in 2004 related to a reduction in the liability for anInternational post-retirement benefit arrangement whose terms weremodified.

The following weighted-average assumptions were usedin accounting for both the benefit obligations and net periodic benefitcost of the pension plans:

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|                                       |  |            |     |                     |  |        |      |         |  |        |     |         |  |        |     |         |  |        |     |         |  |        |     |         |  |  |
|---------------------------------------|--|------------|-----|---------------------|--|--------|------|---------|--|--------|-----|---------|--|--------|-----|---------|--|--------|-----|---------|--|--------|-----|---------|--|--|
|                                  |  | U.S. Plans |     | International Plans |
|                                  |  | 2005       |     | 2004                |  | 2003   |      | 2005    |  | 2004   |     | 2003    |
| Discountrate                          |  |       | 5.5 | %              |  |   | 5.75 | %  |  |   | 6.0 | %  |  |   | 5.0 | %  |  |   | 5.5 | %  |  |   | 5.4 | %  |
| Expected return on plan assets        |  |       | 8.5 |                |  |   | 8.5  |    |  |   | 8.8 |    |  |   | 6.7 |    |  |   | 7.0 |    |  |   | 7.1 |    |
| Rate of future compensation increases |  |       | 4.0 |                |  |   | 4.0  |    |  |   | 4.0 |    |  |   | 3.7 |    |  |   | 3.7 |    |  |   | 3.6 |    |
|                                       |

The 5.5% discount rate forthe U.S. plans was derived by reference to appropriate benchmark yieldson high quality corporate bonds, with terms which approximate theduration of the benefit payments and the relevant benchmark bondindices considering the individual plan’s characteristics, suchas Moody’s Aa Corporate Bond Index and the Citigroup PensionDiscount Curve, to select a rate at which the Company believes the U.S.pension benefits could be effectively settled. The discount rates forthe Company’s primary international plans were derived fromsimilar local studies, in conjunction with local actuarial consultantsand asset managers.

The Company considers a number of factors todetermine its expected rate of return on plan assets assumption,including, without limitation, recent and historical performance ofplan assets, asset allocation and other third-party studies andsurveys. The Company considered the plan portfolios' assetallocations over a variety of time periods and compared them withthird-party studies and reviewed performance of the capital markets inrecent years and other factors and advice from various third parties,such as the pension plans' advisers, investment managers andactuaries. While the Company considered recent performance and thehistorical performance of plan assets over a ten-year period (from 1995to 2005), the results of which exceeded the Company’s expectedrate of return, the Company’s assumptions are based primarily onits estimates of long-term, prospective rates of return. Using theaforementioned methodologies, the Company selected the 8.5%return on assets assumption used for the U.S pension plans. Differencesbetween actual and expected asset returns are recognized in the netperiodic benefit cost over the remaining service period of the activeparticipating employees.

The rate of future compensationincreases is an assumption used by the actuarial consultants forpension accounting and is determined based on the Company’scurrent expectation for such increases.

The following tablepresents domestic and foreign pension plan assets information atSeptember  30,  2005, 2004 and 2003:

|                          |  |            |       |                     |  |      |       |        |  |      |       |        |  |   |      |        |  |   |      |        |  |   |      |        |  |  |
|--------------------------|--|------------|-------|---------------------|--|------|-------|--------|--|------|-------|--------|--|---|------|--------|--|---|------|--------|--|---|------|--------|--|--|
|                     |  | U.S. Plans |       | International Plans |
|                     |  | 2005       |       | 2004                |  | 2003 |       | 2005   |  | 2004 |       | 2003   |
| Fair value ofplan assets |  | $          | 347.5 |                |  | $    | 308.9 |   |  | $    | 272.1 |   |  | $ | 35.5 |   |  | $ | 32.6 |   |  | $ | 26.5 |   |
|                          |

The Investment Committee for theCompany's pension plans (the ‘‘InvestmentCommittee’’) has adopted (and revises from time to time) aninvestment policy for the U.S. pension plans intended to meet or exceedthe expected rate of return on plan assets assumption. In connectionwith this objective, the Investment Committee retains professionalinvestment managers that invest plan assets in the following assetclasses: equity and fixed income securities, real estate, and cash andother investments, which may include hedge funds and private equity andglobal balanced strategies. The International plans follow a similarmethodology in conjunction with local actuarial consultants and assetmanagers.

The U.S. pension plans currently have the followingtarget ranges for these asset classes, which are reviewed quarterly andconsidered for readjustment when an asset class weighting is outside ofits target range (recognizing that these are flexible target rangesthat may vary from time to time) with the goal of achieving therequired return at a reasonable risk level as follows:

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|                            |  |                 |        |        |        |        |        |        |  |  |
|----------------------------|--|-----------------|--------|--------|--------|--------|--------|--------|--|--|
|                       |  | Target Ranges   |        |   |
| AssetCategory:             |  |            |   |   |        |   |   |   |
| Equitysecurities           |  | 37% –47%  |        |   |   |   |
| Fixed income securities    |  | 17% – 25% |        |   |   |   |
| Realestate                 |  | 0% – 8%   |        |   |   |   |
| Cash and other investments |  | 8%– 18%   |        |   |   |   |
| Global balancedstrategies  |  | 15% – 25% |        |   |   |   |
|                            |

The U.S. pension plans weighted-average assetallocations at September  30,  2005 and 2004 by assetcategories were as follows:

|                            |  |        |        |         |  |        |        |         |  |  |
|----------------------------|--|--------|--------|---------|--|--------|--------|---------|--|--|
|                       |  | 2005   |        | 2004    |
| AssetCategory:             |  |   |   |    |  |   |   |    |
| Equitysecurities           |  |   | 43.6   | %  |  |   | 45.7   | %  |
| Fixed income securities    |  |   | 17.9   |    |  |   | 25.5   |    |
| Real estate                |  |   | 4.4    |    |  |   | 4.0    |    |
| Cashand other investments  |  |   | 13.7   |    |  |   | 8.2    |    |
| Global balanced strategies |  |   | 20.4   |    |  |   | 16.6   |    |
|                       |  |   | 100.0  | %  |  |   | 100.0  | %  |
|                            |

Within the equity securitiesasset class, the investment policy provides for investments in a broadrange of publicly-traded securities ranging from small to largecapitalization stocks and U.S. and international stocks. Within thefixed income securities asset class, the investment policy provides forinvestments in a broad range of publicly-traded debt securities rangingfrom U.S. Treasury issues, corporate debt securities, mortgages andasset-backed issues, as well as international debt securities. Withinthe real estate asset class, the investment policy provides forinvestment in a diversified commingled pool of real estate propertiesacross the U.S. In the cash and other investments asset class,investments may be in cash and cash equivalents and other investments,which may include hedge funds and private equity not covered in theclasses listed above, provided that such investments are approved bythe Investment Committee prior to their selection. Within the globalbalanced strategies, the investment policy provides for investments ina broad range of publicly traded stocks and bonds in both U.S. andinternational markets as described in the asset classes listed above.In addition, the global balanced strategies can include commodities,provided that such investments are approved by the Investment Committeeprior to their selection.

The Investment Committee’sinvestment policy does not allow the use of derivatives for speculativepurposes, but such policy does allow its investment managers to usederivatives to reduce risk exposures or to replicate exposures of aparticular asset class.

Contributions:

TheCompany’s policy is to fund at least the minimum contributionsrequired to meet applicable federal employee benefit and local laws, orto directly pay benefit payments where appropriate. During 2006, theCompany expects to contribute approximately $31.6  million to itspension plans and $1.0  million to other post-retirement benefitplans.

Estimated Future Benefit Payments:

The followingbenefit payments, which reflect expected future service, asappropriate, are expected to be paid:

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|                    |  |                       |       |                     |  |        |     |        |  |  |
|--------------------|--|-----------------------|-------|---------------------|--|--------|-----|--------|--|--|
|               |  | Total PensionBenefits |       | Total OtherBenefits |
| 2006               |  | $                     | 28.5  |                |  | $      | 1.1 |   |
| 2007               |  |                  | 29.9  |                |  |   | 1.2 |   |
| 2008               |  |                  | 31.9  |                |  |   | 1.2 |   |
| 2009               |  |                  | 33.3  |                |  |   | 1.2 |   |
| 2010               |  |                  | 35.0  |                |  |   | 1.2 |   |
| Years 2011 to 2015 |  |                  | 197.3 |                |  |   | 6.0 |   |
|                    |

13.    STOCKHOLDERS'EQUITY

Information about the Company's preferred,common and treasury stock issued and/or outstanding is as follows:

|                                            |  |                 |         |              |  |               |         |         |  |        |             |         |  |        |            |        |  |        |         |        |  |  |
|--------------------------------------------|--|-----------------|---------|--------------|--|---------------|---------|---------|--|--------|-------------|---------|--|--------|------------|--------|--|--------|---------|--------|--|--|
|                                       |  | Preferred Stock |         | Common Stock |  | TreasuryStock |
|                                       |  | Class A         |         | Class B      |  | Class A       |         | Class B |
| Balance, January1,  2003                   |  |            | 546     |         |  |          | 4,333   |    |  |   | 22,521,135  |    |  |   | 31,250,000 |   |  |   | — |   |
| Stockissuances                             |  |            | — |         |  |          | — |    |  |   | 17,605,650  |    |  |   | —    |   |  |   | — |   |
| Restricted stockplans                      |  |            | — |         |  |          | — |    |  |   | 200,000     |    |  |   | —    |   |  |   | — |   |
| Cancellation ofrestricted stock            |  |            | — |         |  |          | — |    |  |   | (148,334    | )  |  |   | —    |   |  |   | — |   |
| Balance, December  31,2003                 |  |            | 546     |         |  |          | 4,333   |    |  |   | 40,178,451  |    |  |   | 31,250,000 |   |  |   | — |   |
| Stockissuances                             |  |            | — |         |  |          | — |    |  |   | 299,536,000 |    |  |   | —    |   |  |   | — |   |
| Conversions                                |  |            | (546    | )       |  |          | (4,333  | )  |  |   | 433,493     |    |  |   | —    |   |  |   | — |   |
| Restricted stock plans                     |  |            | — |         |  |          | — |    |  |   | 4,495,000   |    |  |   | —    |   |  |   | — |   |
| Cancellation of restricted stock           |  |            | — |         |  |          | — |    |  |   | (50,000     | )  |  |   | —    |   |  |   | — |   |
| Balance,December  31,  2004                |  |            | — |         |  |          | — |    |  |   | 344,592,944 |    |  |   | 31,250,000 |   |  |   | — |   |
| Exercise of stock options for common stock |  |            | — |         |  |          | — |    |  |   | 18,125      |    |  |   | —    |   |  |   | — |   |
| Restricted stock plans                     |  |            | — |         |  |          | — |    |  |   | 50,000      |    |  |   | —    |   |  |   | — |   |
| Cancellation of restricted stock           |  |            | — |         |  |          | — |    |  |   | (188,334    | )  |  |   | —    |   |  |   | — |   |
| Repurchase of restricted stock             |  |            | — |         |  |          | — |    |  |   | —     |    |  |   | —    |   |  |   | 236,315 |   |
| Balance,December  31,  2005                |  |            | — |         |  |          | — |    |  |   | 344,472,735 |    |  |   | 31,250,000 |   |  |   | 236,315 |   |
|                                            |

Preferred Stock

Prior to itselimination in March  2004, the Company's designatedpreferred stock consisted of 20  million shares of Series APreferred Stock, and 20  million shares of Series B PreferredStock. On March  24,  2004, shares of the Series A PreferredStock were exchanged for approximately 8.7  million shares ofRevlon, Inc. Class A Common Stock and shares of Series B PreferredStock were converted into 433,333 shares of Revlon, Inc. Class A CommonStock as part of the Revlon Exchange Transactions. On March29,  2004, in connection with the Revlon Exchange Transactions,the Company eliminated the Series A and Series B Preferred Stock. SeeNote 9, ‘‘Long-Term Debt’’.

CommonStock

As of December  31,  2005, the Company'sauthorized common stock consists of 900  million shares of Class ACommon Stock and 200  million shares of Class B Common Stock, parvalue $0.01 per share (‘‘Class B Common Stock’’and together with the Class A Common Stock, the ‘‘CommonStock’’). The holders of Class A Common Stock and Class BCommon Stock vote as a single class on all matters, except as otherwiserequired by law, with each share of Class A Common Stock entitling itsholder to one vote and each share of the Class B Common Stock entitlingits holder to ten votes. All of the shares of Class B Common Stock areowned by REV Holdings. As a result of the Revlon Exchange Transactions,MacAndrews & Forbes beneficially owned, as of December31,  2005, approximately 60% of the Company's CommonStock (representing approximately 77% of the combined votingpower of the 

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Company's Common Stock). The holders ofthe Company's two classes of Common Stock are entitled to shareequally in the earnings of the Company from dividends, when and ifdeclared by Revlon, Inc.’s Board of Directors. Each outstandingshare of Class B Common Stock is convertible into one share of Class ACommon Stock.

The consummation of the Revlon ExchangeTransactions on March  25,  2004 resulted in the issuance of299,969,493 shares of Class A Common Stock, including approximately8.7  million shares of Class A Common Stock in exchange foroutstanding Series A Preferred Stock and 433,333 shares of Class ACommon Stock upon conversion of the 4,333 shares of Series B PreferredStock (see Note 9, ‘‘Long-Term Debt’’). As aresult of the Revlon Exchange Transactions, on March  25,2004 Revlon, Inc. had outstanding 338,177,944 shares of its Class ACommon Stock and 31,250,000 shares of its Class B Common Stock, withMacAndrews & Forbes beneficially owning as of March  25,2004 approximately 221.2  million shares of the Common Stock(representing approximately 60% of the outstanding shares ofCommon Stock and approximately 77% of the combined voting powerof the Common Stock); funds and accounts managed by Fidelitybeneficially owning as of March  25,  2004 approximately78.4  million shares of Class A Common Stock (representingapproximately 21% of the outstanding shares of Common Stock andapproximately 12% of the combined voting power of the CommonStock, excluding the impact of unvested restricted stock); and otherstockholders beneficially owning as of March  25,  2004approximately 69.8  million shares of Class A Common Stock(representing approximately 19% of the outstanding shares of theCommon Stock and approximately 11% of the combined voting powerof the Common Stock). As filed by Fidelity with the SEC onFebruary  14,  2006 and reporting, as of December31,  2005, on a Schedule 13G/A, Fidelity held approximately57.9  million shares of Class A Common Stock, representingapproximately 16% of the outstanding shares of Common Stock andapproximately 9% of the combined voting power of the CommonStock, excluding the impact of unvested restricted stock.

InFebruary  2003, the Company entered into an investment agreementwith MacAndrews & Forbes Holdings (the ‘‘2003Investment Agreement’’) pursuant to which Revlon, Inc.undertook and, on June  20,  2003, completed, a $50million equity rights offering (the ‘‘2003 RightsOffering’’) in which Revlon, Inc.'s stockholderspurchased additional shares of Class A Common Stock. Pursuant to the2003 Rights Offering, Revlon, Inc. distributed to each stockholder ofrecord of its Common Stock, as of the close of business on May12,  2003, the record date set by Revlon, Inc.’s Board ofDirectors, at no charge, one transferable subscription right for each2.9403 shares of Common Stock owned. Each subscription right enabledthe holder to purchase one share of Class A Common Stock at asubscription price equal to $2.84, representing 80% of the $3.55closing price per share of Revlon, Inc. Class A Common Stock on the NewYork Stock Exchange on May  12,  2003, the record date of the2003 Rights Offering. In connection with the consummation of the 2003Rights Offering on June  20,  2003, Revlon, Inc. issued anadditional 17,605,650 shares of its Class A Common Stock, including3,015,303 shares subscribed for by the public and 14,590,347 sharesissued to MacAndrews & Forbes in a private placement (representingthe number of shares of Revlon, Inc.'s Class A Common Stock thatMacAndrews & Forbes would otherwise have been entitled to purchasepursuant to its basic subscription privilege, which was approximately83% of the shares of Revlon, Inc.'s Class A Common Stockoffered in the 2003 Rights Offering). See Note 20,‘‘Subsequent Events’’.

TreasuryStock

In April and September  2005, certain executives, inlieu of paying withholding taxes on the vesting of certain restrictedstock, authorized the withholding of an aggregate 183,914 and 52,401shares, respectively of Revlon, Inc. Class A Common Stock to satisfythe minimum statutory tax withholding requirements related to suchvesting in accordance with the share withholding provisions of Revlon,Inc.’s Stock Plan, a stock-based compensation plan. These shareswere recorded as treasury stock using the cost method, at $3.29 and$3.57 per share, respectively, the market price on the vesting date,for a total of $0.6  million and $0.2  million,respectively.

14.    STOCK COMPENSATIONPLAN

Revlon, Inc. applies APB Opinion No. 25 and itsrelated interpretations in accounting for the Stock Plan, itsstock-based compensation plan. Under APB Opinion No. 25, because theexercise price of 

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Revlon, Inc.'s employee stock optionsunder the Stock Plan equals the market price of the underlying stock onthe date of grant, no compensation cost has been recognized for thefiscal periods ended December  31,  2005.

InJune  2004, the Stock Plan was amended and restated to, amongother things, increase the number of shares available for grant and toreduce the maximum term of the option grants to 7 years. Awards may begranted to employees and directors of Revlon, Inc., and itssubsidiaries for up to an aggregate of 40,650,000 shares of Class ACommon Stock, of which up to 5,935,000 shares may be issued asrestricted stock. Non-qualified options granted under the Stock Planare granted at prices that equal or exceed the market value of Class ACommon Stock on the grant date and have a term of 7 years (optiongrants under the Stock Plan prior to June  4,  2004 have aterm of 10 years). Option grants vest over service periods that rangefrom one to five years. Certain option grants contain provisions thatallow for accelerated vesting if the Class A Common Stock closing priceequals or exceeds amounts ranging from $30.00 to $40.00 per share.Additionally, certain employee stock option grants vest upon a‘‘change in control’’ as defined in therespective stock option agreements.

In August  2004,pursuant to a pre-existing contractual commitment, the Compensation andStock Plan Committee (the ‘‘CompensationCommittee’’) of Revlon, Inc.’s Board of Directorsgranted options to a former executive officer of the Company topurchase 825,000 shares of Class A Common Stock at $3.03 per share,vesting 25% on each December  31st thereafterand with a term of 7 years. The transaction was valued using theBlack-Scholes option-pricing model and the Company recognized$1.2  million in stock compensation expense related to thegrant.

Stock options:

At December31,  2005, 2004 and 2003 there were 15,972,389, 10,415,745 and3,792,196 stock options exercisable under the Stock Plan,respectively.

A summary of the status of the Stock Plan as ofDecember  31,  2005, 2004 and 2003 and changes during theyears then ended is presented below:

|                                    |  |                     |          |                               |  |        |         |        |  |  |
|------------------------------------|--|---------------------|----------|-------------------------------|--|--------|---------|--------|--|--|
|                               |  | Shares(000’s) |          | WeightedAverageExercise Price |
| Outstanding at January  1,  2003   |  |                | 7,886.1  |                          |  | $      | 12.83   |   |
| Granted                            |  |                | 1,091.6  |                          |  |   | 3.00    |   |
| Exercised                          |  |                | —  |                          |  |   | — |   |
| Forfeited                          |  |                | (1,270.1 | )                        |  |   | 17.43   |   |
| Outstanding at December  31,  2003 |  |                | 7,707.6  |                          |  |   | 10.66   |   |
| Granted                            |  |                | 24,517.4 |                          |  |   | 3.03    |   |
| Exercised                          |  |                | —  |                          |  |   | — |   |
| Forfeited                          |  |                | (1,443.3 | )                        |  |   | 9.01    |   |
| Outstanding at December  31,  2004 |  |                | 30,781.7 |                          |  |   | 4.66    |   |
| Granted                            |  |                | 5,200.4  |                          |  |   | 2.56    |   |
| Exercised                          |  |                | (18.1    | )                        |  |   | 3.03    |   |
| Forfeited                          |  |                | (2,930.9 | )                        |  |   | 5.59    |   |
| Outstanding at December  31,  2005 |  |                | 33,033.1 |                          |  |   | 4.25    |   |
|                                    |

The weighted average grant date fairvalue of options granted during 2005, 2004 and 2003 approximated $1.38,$2.08 and $2.03, respectively, and were estimated using theBlack-Scholes option valuation model with the followingweighted-average assumptions:

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|                         |  |                        |  |            |  |            |  |  |  |  |  |  |  |  |
|-------------------------|--|------------------------|--|------------|--|------------|--|--|--|--|--|--|--|--|
|                    |  | Year Ended December31, |
|                    |  | 2005                   |  | 2004       |  | 2003       |
| Expected life of option |  | 4.75 years             |  | 7.00 years |  | 7.00 years |
| Risk-freeinterest rate  |  | 3.95%                  |  | 3.95%      |  | 3.72%      |
| Expected volatility     |  | 61%                    |  | 69%        |  | 70%        |
| Expected dividend yield |  | N/A                    |  | N/A        |  | N/A        |
|                         |

The following table summarizes informationabout the Stock Plan's options outstanding at December31,  2005:

|                                                                                                                                                            |  |                              |          |                               |  |                              |        |                              |  |                               |        |        |  |        |          |        |  |        |        |        |  |  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--|------------------------------|----------|-------------------------------|--|------------------------------|--------|------------------------------|--|-------------------------------|--------|--------|--|--------|----------|--------|--|--------|--------|--------|--|--|
|                                                                                                                                                       |  | Outstanding                  |          | Exercisable                   |
| RangeofExercise Prices                                                                                                                                     |  | NumberofOptions(000’s) |          | WeightedAverageYearsRemaining |  | WeightedAverageExercisePrice |        | NumberofOptions(000’s) |  | Weighted AverageExercisePrice |
| $  2.31        to        $  3.78                       |  |                         | 29,536.0 |                          |  |                         | 5.60   |                         |  | $                             | 2.99   |   |  |   | 12,977.5 |   |  | $      | 3.12   |   |
|     3.82        to            6.88 |  |                         | 1,508.1  |                          |  |                         | 5.87   |                         |  |                          | 4.87   |   |  |   | 1,005.9  |   |  |   | 5.31   |   |
|     7.06        to          15.00            |  |                         | 1,115.5  |                          |  |                         | 3.96   |                         |  |                          | 10.28  |   |  |   | 1,115.5  |   |  |   | 10.28  |   |
|   18.50        to          50.00                       |  |                         | 873.5    |                          |  |                         | 1.89   |                         |  |                          | 38.14  |   |  |   | 873.5    |   |  |   | 38.14  |   |
|     2.31        to          50.00            |  |                         | 33,033.1 |                          |  |                         |   |                         |  |                          |   |   |  |   | 15,972.4 |   |  |   |   |   |
|                                                                                                                                                            |

Restricted stock awards: 

TheStock Plan also allows for awards of restricted stock to employees anddirectors of Revlon, Inc. and its subsidiaries, including ProductsCorporation. The restricted stock awards vest over service periods thatrange from three to five years. In 2005, 2004 and 2003, the Companygranted 50,000, 4,495,000 and 200,000 shares, respectively, ofrestricted stock under the Stock Plan with weighted average fairvalues, based on the market price of Class A Common Stock on the datesof grant, of $3.13, $3.03 and $3.01, respectively. At December31,  2005 and 2004, there were 3,412,502 and 5,327,500 shares,respectively, of restricted stock outstanding and unvested under theStock Plan.

In 2002, Revlon, Inc. adopted the Revlon, Inc. 2002Supplemental Stock Plan (the ‘‘Supplemental StockPlan’’), the purpose of which was to provide Mr.Jack  Stahl, the Company's President and Chief ExecutiveOfficer, the sole eligible participant, with inducement awards toentice him to join the Company to enhance the Company's long-termperformance and profitability. The Supplemental Stock Plan covers530,000 shares of Class A Common Stock. All of the 530,000 shares wereissued in the form of restricted shares of Class A Common Stock to theCompany’s President and Chief Executive Officer inFebruary  2002. The terms of the Supplemental Stock Plan and theforegoing grant of restricted shares to the President and ChiefExecutive Officer are substantially the same as the Stock Plan.Pursuant to the terms of the Supplemental Stock Plan, such grant wasmade conditioned upon his execution of the Company's standardEmployee Agreement as to Confidentiality and Non-Competition.

Nodividends will be paid on unvested restricted stock, provided, however,that in connection with the 2002 grants to the Company's Presidentand Chief Executive Officer, of 470,000 shares of restricted stockunder the Stock Plan and 530,000 shares of restricted stock under theSupplemental Stock Plan (of which 750,000 shares of restricted stockremained unvested at December  31,  2005), in the event anycash or in-kind distributions are made in respect of Common Stock priorto the lapse of the restrictions on such shares, such dividends will beheld by the Company and paid to Mr.  Stahl when and if suchrestrictions lapse.

The Company amortizes amounts related torestricted stock awards using the straight-line method over the vestingperiod as compensation expense and recorded expense of $5.8million, $5.2  million and $2.2  million during 2005, 2004and 2003, respectively, and deferred compensation of $6.5  millionand $12.5  million at December  31,  2005 and 2004,respectively, related to the restricted stock awards.

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15.    COMPREHENSIVELOSS

The components of comprehensive loss during 2005,2004 and 2003 are as follows:

|                                 |  |                            |         |                         |  |                      |         |                                   |  |        |         |         |  |        |        |         |  |  |
|---------------------------------|--|----------------------------|---------|-------------------------|--|----------------------|---------|-----------------------------------|--|--------|---------|---------|--|--------|--------|---------|--|--|
|                            |  | ForeignCurrencyTranslation |         | MinimumPensionLiability |  | DeferredLoss-Hedging |         | AccumulatedOtherComprehensiveLoss |
| Balance, January  1,  2003      |  | $                          | (19.1   | )                  |  | $                    | (113.6  | )                            |  | $      | — |    |  | $      | (132.7 | )  |
| Unrealized (losses)             |  |                       | 10.6    |                    |  |                 | 1.5     |                              |  |   | (2.9    | )  |  |   | 9.2    |    |
| Reclassifications into netloss  |  |                       | — |                    |  |                 | — |                              |  |   | 1.5     |    |  |   | 1.5    |    |
| Balance, December31,  2003      |  |                       | (8.5    | )                  |  |                 | (112.1  | )                            |  |   | (1.4    | )  |  |   | (122.0 | )  |
| Unrealizedgains (losses)        |  |                       | 0.6     |                    |  |                 | (1.6    | )                            |  |   | (2.8    | )  |  |   | (3.8   | )  |
| Reclassifications into net loss |  |                       | — |                    |  |                 | — |                              |  |   | 1.5     |    |  |   | 1.5    |    |
| Balance December  31,  2004     |  |                       | (7.9    | )                  |  |                 | (113.7  | )                            |  |   | (2.7    | )  |  |   | (124.3 | )  |
| Unrealized gains (losses)       |  |                       | (6.9    | )                  |  |                 | 6.7     |                              |  |   | 0.2     |    |  |   | 1.5    |    |
| Reclassifications into net loss |  |                       | 0.4     |                    |  |                 | — |                              |  |   | 2.2     |    |  |   | 1.1    |    |
| Balance December  31,  2005     |  | $                          | (14.4   | )                  |  | $                    | (107.0  | )                            |  | $      | (0.3    | )  |  | $      | (121.7 | )  |
|                                 |

16.    RELATED PARTYTRANSACTIONS

As of December  31,  2005,MacAndrews & Forbes beneficially owned shares of Revlon,Inc.'s Common Stock having approximately 77% of thecombined voting power of such outstanding shares. As a result,MacAndrews & Forbes is able to elect Revlon, Inc.'s entireBoard of Directors and control the vote on all matters submitted to avote of Revlon, Inc.'s stockholders. MacAndrews & Forbes iswholly owned by Ronald O. Perelman, Chairman of Revlon, Inc.'sBoard of Directors.

Transfer Agreements

In June1992, Revlon, Inc. and Products Corporation entered into an assettransfer agreement with Revlon Holdings LLC, a Delaware limitedliability company and formerly a Delaware corporation known as RevlonHoldings Inc. (‘‘Revlon Holdings’’) and whichis an affiliate and an indirect wholly-owned subsidiary of MacAndrews& Forbes and certain of Revlon Holdings’ wholly-ownedsubsidiaries. Revlon, Inc. and Products Corporation also entered into areal property asset transfer agreement with Revlon Holdings. Pursuantto such agreements, on June  24,  1992 Revlon Holdingstransferred assets to Products Corporation and Products Corporationassumed all of the liabilities of Revlon Holdings, other than certainspecifically excluded assets and liabilities (the liabilities excludedare referred to as the ‘‘ExcludedLiabilities’’). Certain consumer products lines sold indemonstrator-assisted distribution channels considered not integral toRevlon, Inc.'s business and that historically had not beenprofitable and certain other assets and liabilities were retained byRevlon Holdings. Revlon Holdings agreed to indemnify Revlon, Inc. andProducts Corporation against losses arising from the ExcludedLiabilities, and Revlon, Inc. and Products Corporation agreed toindemnify Revlon Holdings against losses arising from the liabilitiesassumed by Products Corporation. The amounts reimbursed by RevlonHoldings to Products Corporation for the Excluded Liabilities for 2005,2004 and 2003 were $0.2  million, $0.2  million and$0.3  million, respectively.

Reimbursement Agreements

Revlon, Inc., Products Corporation and MacAndrews & Forbes Inc.(a wholly-owned subsidiary of MacAndrews & Forbes Holdings) haveentered into reimbursement agreements (the ‘‘ReimbursementAgreements’’) pursuant to which (i) MacAndrews & ForbesInc. is obligated to provide (directly or through affiliates) certainprofessional and administrative services, including employees, toRevlon, Inc. and its subsidiaries, including Products Corporation, andpurchase services from third party providers, such as insurance, legaland accounting services and air transportation services, on behalf ofRevlon, Inc. and its subsidiaries, including Products Corporation, tothe extent requested by Products Corporation, 

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and (ii) Products Corporation is obligatedto provide certain professional and administrative services, includingemployees, to MacAndrews & Forbes and purchase services from thirdparty providers, such as insurance and legal and accounting services,on behalf of MacAndrews & Forbes to the extent requested byMacAndrews & Forbes Inc., provided that in each case theperformance of such services does not cause an unreasonable burden toMacAndrews & Forbes or Products Corporation, as the case may be.Products Corporation reimburses MacAndrews & Forbes for theallocable costs of the services purchased for or provided to ProductsCorporation and its subsidiaries and for reasonable out-of-pocketexpenses incurred in connection with the provision of such services.MacAndrews & Forbes Inc. (or such affiliates) reimburses ProductsCorporation for the allocable costs of the services purchased for orprovided to MacAndrews & Forbes and for the reasonableout-of-pocket expenses incurred in connection with the purchase orprovision of such services. Each of Revlon, Inc. and ProductsCorporation, on the one hand, and MacAndrews & Forbes Inc., on theother, has agreed to indemnify the other party for losses arising outof the provision of services by it under the Reimbursement Agreementsother than losses resulting from its willful misconduct or grossnegligence. The Reimbursement Agreements may be terminated by eitherparty on 90 days' notice. Products Corporation does not intend torequest services under the Reimbursement Agreements unless their costswould be at least as favorable to Products Corporation as could beobtained from unaffiliated third parties. Revlon, Inc. and ProductsCorporation participate in MacAndrews & Forbes' directors andofficers liability insurance program, which covers Revlon, Inc. andProducts Corporation as well as MacAndrews & Forbes. The limits ofcoverage are available on an aggregate basis for losses to any or allof the participating companies and their respective directors andofficers. Revlon, Inc. and Products Corporation reimburse MacAndrews& Forbes from time to time for their allocable portion of thepremiums for such coverage, which the Company believes is morefavorable than the premiums the Company would pay were it to securestand-alone coverage. The amounts paid by Revlon, Inc. and ProductsCorporation to MacAndrews & Forbes for premiums is included in theamounts paid under the Reimbursement Agreements. The net amountsreimbursable from (payable to) MacAndrews & Forbes Inc. for theservices provided under the Reimbursement Agreements for 2005, 2004 and2003, were $(3.7) million, $1.0  million and $(2.7) million,respectively.

Tax Sharing Agreements

As a result of theclosing of the Revlon Exchange Transactions, as of the end ofMarch  25,  2004, Revlon, Inc., Products Corporation andtheir U.S. subsidiaries were no longer included in the MacAndrews &Forbes Group for federal income tax purposes. See Note 11,‘‘Income Taxes’’, for further discussion onthese agreements and related transactions in 2005, 2004 and 2003.

Registration Rights Agreement

Prior to the consummation ofRevlon, Inc.'s initial public equity offering in February1996, Revlon, Inc. and Revlon Worldwide Corporation (subsequentlymerged into REV Holdings), the then direct parent of Revlon, Inc.,entered into a registration rights agreement (the‘‘Registration Rights Agreement’’), and inFebruary  2003, MacAndrews & Forbes Inc. executed a joinderagreement to the Registration Rights Agreement, pursuant to which REVHoldings, MacAndrews & Forbes Inc. and certain transferees ofRevlon, Inc.'s Common Stock held by REV Holdings (the‘‘Holders’’) had the right to require Revlon,Inc. to register under the Securities Act all or part of the Class ACommon Stock owned by such Holders, including shares of Class A CommonStock purchased in connection with the $50.0  million equityrights offering consummated by Revlon, Inc. in 2003, and shares ofClass A Common Stock issuable upon conversion of Revlon, Inc.'sClass B Common Stock owned by such Holders (a ‘‘DemandRegistration’’); provided that Revlon, Inc. may postponegiving effect to a Demand Registration for a period of up to 30 days ifRevlon, Inc. believes such registration might have a material adverseeffect on any plan or proposal by Revlon, Inc. with respect to anyfinancing, acquisition, recapitalization, reorganization or othermaterial transaction, or if Revlon, Inc. is in possession of materialnon-public information that, if publicly disclosed, could result in amaterial disruption of a major corporate development or transactionthen pending or in progress or in other material adverse consequencesto Revlon, Inc. In addition, the Holders have the right to participatein registrations by Revlon, Inc. of its Class A Common Stock (a‘‘Piggyback Registration’’). The Holders willpay all out-of-pocket expenses 

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incurred in connection with any DemandRegistration. Revlon, Inc. will pay any expenses incurred in connectionwith a Piggyback Registration, except for underwriting discounts,commissions and expenses attributable to the shares of Class A CommonStock sold by such Holders. In connection with the closing of theRevlon Exchange Transactions and pursuant to the 2004 InvestmentAgreement, MacAndrews & Forbes Inc. executed a joinder agreementthat provided that MacAndrews & Forbes Inc. would also be a Holderunder the Registration Rights Agreement and that all shares acquired byMacAndrews & Forbes Inc., pursuant to the Debt ReductionTransactions or the 2004 Investment Agreement, are deemed to beregistrable securities under the Registration Rights Agreement. Thiswould include any Class A Common Stock acquired by MacAndrews &Forbes in connection with Revlon, Inc.'s previously-announced$110  million rights offering, which it intends to conduct by theend of March  2006, and that would allow stockholders as of theFebruary  13,  2006 record date to purchase additional sharesof Class A Common Stock. (See Note 20, ‘‘SubsequentEvents’’).

2004 Consolidated MacAndrews &Forbes Line of Credit

For a description of transactions in 2005and 2004 with MacAndrews & Forbes in connection with the 2004 loanagreements with MacAndrews & Forbes, see Note 9,‘‘Long-Term Debt’’.

RefinancingTransactions

For a description of transactions in 2005 and 2004with MacAndrews & Forbes in connection with the Debt ReductionTransactions, the Revlon Exchange Transactions and the 2004 InvestmentAgreement, see Note 9, ‘‘Long-Term Debt’’.

Other

Pursuant to a lease dated April  2,  1993(the ‘‘Edison Lease’’), Revlon Holdings leasedto Products Corporation the Edison research and development facilityfor a term of up to 10 years with an annual rent of $1.4  millionand certain shared operating expenses payable by Products Corporationwhich, together with the annual rent, were not to exceed $2.0million per year. In August  1998, Revlon Holdings sold the Edisonfacility to an unrelated third party, which assumed substantially allliability for environmental claims and compliance costs relating to theEdison facility, and in connection with the sale Products Corporationterminated the Edison Lease and entered into a new lease with the newowner. Revlon Holdings agreed to indemnify Products Corporation throughSeptember  1,  2013 (the term of the new lease) to the extentthat rent under the new lease exceeds rent that would have been payableunder the terminated Edison Lease had it not been terminated. The netamounts reimbursed by Revlon Holdings to Products Corporation withrespect to the Edison facility for 2005, 2004 and 2003 were $0.3million, $0.3  million and $1.1  million, respectively.

During 2005, 2004 and 2003, Products Corporation leased a smallamount of space at certain facilities to MacAndrews & Forbes or itsaffiliates pursuant to occupancy agreements and leases, including spaceat Products Corporation's New York headquarters. The rent paid byMacAndrews & Forbes or its affiliates to Products Corporation for2005, 2004 and 2003 was $0.2  million, $0.3  million and$0.3  million, respectively.

The 2004 Credit Agreement is,and prior to the redemption of all Products Corporation'soutstanding 12% Senior Secured Notes in July and August2004, the 12% Senior Secured Notes were, supported by, amongother things, guaranties from Revlon, Inc. and, subject to certainlimited exceptions, all of the domestic subsidiaries of ProductsCorporation. The obligations under such guaranties are and were securedby, among other things, the capital stock of Products Corporation and,subject to certain limited exceptions, the capital stock of all ofProducts Corporation's domestic subsidiaries and 66% of thecapital stock of Products Corporation's and its domesticsubsidiaries' first-tier foreign subsidiaries. In connection withthe Revlon Exchange Transactions, on February  11,  2004,Revlon, Inc. entered into supplemental indentures pursuant to which itagreed to guarantee the obligations of Products Corporation under theindentures governing Products Corporation's8 5/8% Senior Subordinated Notes and, prior totheir redemption in April  2005, Products Corporation’s8 1/8% Senior Notes and 9% SeniorNotes.

In March  2002, prior to the passage of theSarbanes-Oxley Act of 2002, Products Corporation made an advance of$1.8  million to Mr.  Stahl pursuant to his employmentagreement, which was entered into 

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in February  2002, for tax assistancerelated to a grant of restricted stock provided to Mr.  Stahlpursuant to such agreement, which loan bears interest at the applicablefederal rate. In May  2002, prior to the passage of theSarbanes-Oxley Act of 2002, Products Corporation made an advance of$2.0  million to Mr.  Stahl pursuant to his employmentagreement in connection with the purchase of his principal residence inthe New York City metropolitan area, which loan bears interest at theapplicable federal rate. Mr.  Stahl repaid $0.1  million,$0.1  million and $0.1  million of such loan during 2005,2004 and 2003, respectively. Pursuant to his employment agreement,Mr.  Stahl receives from Products Corporation additionalcompensation payable on a monthly basis equal to the amount actuallypaid by him in respect of interest and principal on such $2.0million advance, which for 2005, 2004 and 2003 was $0.1  million,$0.1  million and $0.1  million, respectively. ProductsCorporation also pays Mr.  Stahl a gross up for any taxes payableby Mr.  Stahl as a result of such additional compensation, whichtax gross up amount was $0.1  million, $0.1  million and$0.1  million in 2005, 2004 and 2003, respectively.

During2000, prior to the passage of the Sarbanes-Oxley Act of 2002, ProductsCorporation made an advance of $0.8  million to Mr.Douglas  Greeff, the Company's former Executive VicePresident Strategic Finance, pursuant to his employment agreement,which loan bore interest at the applicable federal rate and was payablein 5 equal annual installments on each of May  9,  2001,2002, 2003, 2004, and May  9,  2005. Mr.  Greeff hasfully repaid such loan, including installments of $0.2  million,$0.2  million and $0.2  million during 2005, 2004 and 2003,respectively. Pursuant to his employment agreement, Mr.  Greeffwas entitled to receive bonuses from Products Corporation, payable oneach May  9th commencing on May  9,  2001 and ending onMay  9,  2005, in each case equal to the sum of the principaland interest on the advance repaid in respect of such year by Mr.Greeff, provided that he remained employed by Products Corporation oneach such May  9th, which bonus installments were paidto Mr.  Greeff. Pursuant to the terms of Mr.  Greeff'sseparation agreement, as a result of the fact that Mr.  Greeffceased employment in February  2005, Mr.  Greeff repaid theremaining amount of the loan on or about May  9,  2005 andProducts Corporation paid the final bonus installment to Mr.Greeff on or about May  12,  2005.

During 2005, 2004and 2003 Products Corporation made payments of $0.6  million,$0.4  million and $0.3  million, respectively, to Ms.Ellen  Barkin under a written agreement pursuant to which sheprovides voiceover services for certain of the Company'sadvertisements, which payments were competitive with industry rates forsimilarly situated talent.

During 2004 and 2003, ProductsCorporation placed advertisements in magazines and other media operatedby Martha Stewart Living Omnimedia, Inc.(‘‘MSLO’’), which is controlled by Ms.Martha  Stewart, a former member of Revlon, Inc.’s Board ofDirectors, who served as MSLO's Founder and Chief CreativeOfficer. Products Corporation paid MSLO $0.9  million and$1.9  million for such services in 2004 and 2003, respectively,which fees were less than 1% of the Company's estimate ofMSLO's consolidated gross revenues, and less than 1% of theCompany's consolidated gross revenues, for 2004 and 2003,respectively. Products Corporation's decision to placeadvertisements for its products in MSLO's magazines and othermedia was based upon their popular appeal to women and the rates paidwere competitive with industry rates for similarly situated magazinesand media. Ms.  Stewart ceased serving as a director inMarch  2004.

Products Corporation employed Mr.Perelman's daughter in a marketing position through June2004, with compensation paid in each of 2004 and 2003 of less than$0.1  million.

Products Corporation employed Mr.Drapkin's daughter in a marketing position through June2004, with compensation paid in each of 2004 and 2003 of less than$0.1  million.

During 2005 and 2004, Products Corporationpaid $1.0  million and $1.0  million, respectively, to anationally-recognized security services company, in which MacAndrews& Forbes has a controlling interest, for security officer services.Products Corporation's decision to engage such firm was based uponits expertise in the field of security services, and the rates werecompetitive with industry rates for similarly situated securityfirms.

Although not required to be disclosed under SFAS No. 57,‘‘Related Party Disclosures’’ during 2005, 2004and 2003, Products Corporation obtained advertising, media and directmarketing services from various subsidiaries of WPP in the ordinarycourse of business. Ms.  Linda  Gosden  Robinson, amember 

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of Revlon, Inc.’s Board of Directors,is employed by one of WPP’s subsidiaries, however, she is not anexecutive officer of WPP and has no direct or indirect materialinterest in the business that the Company conducts with WPP.

17.    COMMITMENTS AND CONTINGENCIES

TheCompany currently leases manufacturing, executive, including researchand development, and sales facilities and various types of equipmentunder operating and capital lease agreements. Rental expense was$17.3  million, $19.4  million and $27.2  million forthe years ended December  31,  2005, 2004 and 2003,respectively. Minimum rental commitments under all noncancelableleases, including those pertaining to idled facilities, with remaininglease terms in excess of one year from December  31,  2005aggregated $136.4  million. Such commitments for each of the fiveyears and thereafter subsequent to December  31,  2005 are$17.9, $18.1, $16.5, $15.5, 14.2 and $54.2  million,respectively.

The Company and its subsidiaries are defendants inlitigation and proceedings involving various matters. In the opinion ofthe Company's management, based upon advice of its counselhandling such litigation and proceedings, adverse outcomes, if any,will not result in a material effect on the Company's consolidatedfinancial condition or results of operations.

The Company isinvolved in various routine legal proceedings incident to the ordinarycourse of its business. The Company believes that the outcome of allpending legal proceedings in the aggregate is unlikely to have amaterial adverse effect on the business or consolidated financialcondition of the Company. A purported class action lawsuit was filed onSeptember  27,  2000, in the United States District Court forthe Southern District of New York on behalf of Dan Gavish, TriciaFontan and Walter Fontan individually and allegedly on behalf of allothers similarly situated who purchased the securities of Revlon, Inc.and REV Holdings Inc. (a Delaware corporation and the predecessor ofREV Holdings) between October  2,  1998 and September30,  1999 (the ‘‘Second Gavish Action’’).The complaint, amended by the plaintiffs in November  2001,alleged, among other things, that Revlon, Inc., certain of its presentand former officers and directors and REV Holdings Inc. violated, amongother things, Rule 10b-5 under the Securities Exchange Act of 1934, asamended. On September  29,  2004, the United States DistrictCourt for the Southern District of New York dismissed the Second GavishAction, without prejudice. Revlon, Inc.’s counsel hassubsequently received a second amended complaint. If this matter ispursued, Revlon, Inc. intends to defend it vigorously as the Companybelieves it is without merit. In light of the settlement of thedefendants' insurance claim for this matter and the otherpurported class actions filed in 1999 and settled in June  2003,which the Company recorded in the fourth quarter of 2002, the Companydoes not expect to incur any further expense in this matter.

18.    QUARTERLY RESULTS OF OPERATIONS(UNAUDITED)

The following is a summary of the unauditedquarterly results of operations:

|                                   |  |                              |        |            |  |             |        |            |  |        |        |         |  |        |        |        |  |  |
|-----------------------------------|--|------------------------------|--------|------------|--|-------------|--------|------------|--|--------|--------|---------|--|--------|--------|--------|--|--|
|                              |  | Year Ended December31,  2005 |
|                              |  | 1stQuarter                   |        | 2ndQuarter |  | 3rd Quarter |        | 4thQuarter |
| Net sales                         |  | $                            | 300.9  |       |  | $           | 318.3  |       |  | $      | 275.3  |    |  | $      | 437.8  |   |
| Grossprofit                       |  |                         | 186.7  |       |  |        | 199.4  |       |  |   | 158.3  |    |  |   | 279.8  |   |
| Net (loss) income (a)             |  |                         | (46.8  | )     |  |        | (35.8  | )     |  |   | (65.4  | )  |  |   | 64.3   |   |
| Basic loss per commonshare:       |  |                         |   |       |  |        |   |       |  |   |   |    |  |   |   |   |
| Net (loss) income percommon share |  | $                            | (0.13  | )     |  | $           | (0.10  | )     |  | $      | (0.18  | )  |  | $      | 0.17   |   |
| Diluted lossper common share:     |  |                         |   |       |  |        |   |       |  |   |   |    |  |   |   |   |
| Net (loss)income per common share |  | $                            | (0.13  | )     |  | $           | (0.10  | )     |  | $      | (0.18  | )  |  | $      | 0.17   |   |
|                                   |

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|                                   |  |                              |        |            |  |             |        |            |  |        |        |         |  |        |        |        |  |  |
|-----------------------------------|--|------------------------------|--------|------------|--|-------------|--------|------------|--|--------|--------|---------|--|--------|--------|--------|--|--|
|                              |  | Year Ended December31,  2004 |
|                              |  | 1stQuarter                   |        | 2ndQuarter |  | 3rd Quarter |        | 4thQuarter |
| Net sales                         |  | $                            | 308.4  |       |  | $           | 316.1  |       |  | $      | 294.4  |    |  | $      | 378.3  |   |
| Grossprofit                       |  |                         | 191.3  |       |  |        | 197.7  |       |  |   | 176.5  |    |  |   | 246.4  |   |
| Net (loss) income (b)             |  |                         | (58.2  | )     |  |        | (38.9  | )     |  |   | (91.6  | )  |  |   | 46.2   |   |
| Basic loss per commonshare:       |  |                         |   |       |  |        |   |       |  |   |   |    |  |   |   |   |
| Net (loss) income percommon share |  | $                            | (0.63  | )     |  | $           | (0.11  | )     |  | $      | (0.25  | )  |  | $      | 0.12   |   |
| Diluted lossper common share:     |  |                         |   |       |  |        |   |       |  |   |   |    |  |   |   |   |
| Net (loss)income per common share |  | $                            | (0.63  | )     |  | $           | (0.11  | )     |  | $      | (0.25  | )  |  | $      | 0.12   |   |
|                                   |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | During2005, primarily in the third and fourth quarters, the Company recordedupfront launch costs of approximately $62  million associated withthe launch of its brand initiatives. In addition, primarily during thefirst and second quarters of 2005, the Company recorded an aggregate$9.0  million loss on early extinguishment of debt, which includesa $5.0  million prepayment fee related to the prepayment of$100.0  million of indebtedness outstanding under the Term LoanFacility of the 2004 Credit Agreement with a portion of the proceedsfrom the issuance of the Original 91⁄2% SeniorNotes, the loss on the redemption of Products Corporation’s8 1/8% Senior Notes and 9% Senior Notes of$1.5  million in the aggregate, as well as the write-off of theportion of deferred financing costs related to such prepaidamount. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | During 2004,primarily in the first and third quarters, the Company incurred$90.7  million in losses on the early extinguishment of debtconsisting of the loss on exchange for equity of certain indebtednessin the Revlon Exchange Transactions and fees, expenses, premiums andthe write-off of deferred financing costs related to the RevlonExchange Transactions, the tender for and redemption of the 12%Senior Secured Notes and the repayment of the 2001 CreditAgreement. |

19.    GEOGRAPHIC, FINANCIAL AND OTHERINFORMATION

The Company manages its business on thebasis of one reportable operating segment. See Note 1,‘‘Summary of Significant Accounting Policies’’,for a brief description of the Company's business. As ofDecember  31,  2005, the Company had operations establishedin 16 countries outside of the U.S. and its products are soldthroughout the world. The Company's results of operations and thevalue of its foreign assets and liabilities may be adversely affectedby, among other things, weak economic conditions, politicaluncertainties, military actions, terrorist activities, adverse currencyfluctuations, competitive activities, retailer inventory management andchanges in consumer purchasing habits, including with respect toshopping channels. Net sales by geographic area are presented byattributing revenues from external customers on the basis of where theproducts are sold. During 2005, 2004 and 2003, Wal-Mart and itsaffiliates worldwide accounted for approximately 24.0%,21.0% and 20.6%, respectively, of the Company's netsales. The Company expects that Wal-Mart and a small number of othercustomers will, in the aggregate, continue to account for a largeportion of the Company's net sales. As is customary in theconsumer products industry, none of the Company’s customers isunder an obligation to continue purchasing products from the Company inthe future. Although the loss of Wal-Mart or one or more of theCompany's other customers that may account for a significantportion of the Company's sales, or any significant decrease insales to these customers or any significant decrease in retail displayspace in any of these customers' stores, could have a materialadverse effect on the Company's business, financial condition orresults of operations, the Company has no reason to believe that anysuch loss of customer or decrease in sales willoccur.

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|                         |  |                        |         |        |  |        |         |        |  |        |         |        |  |  |
|-------------------------|--|------------------------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--|
|                    |  | Year Ended December31, |
|                    |  | 2005                   |         | 2004   |  | 2003   |
| **Geographicarea:**     |  |                   |    |   |  |   |    |   |  |   |    |   |
| Netsales:               |  |                   |    |   |  |   |    |   |  |   |    |   |
| United States           |  | $                      | 788.3   |   |  | $      | 792.7   |   |  | $      | 837.0   |   |
| Canada                  |  |                   | 68.8    |   |  |   | 63.0    |   |  |   | 53.6    |   |
| United States andCanada |  |                   | 857.1   |   |  |   | 855.7   |   |  |   | 890.6   |   |
| International           |  |                   | 475.2   |   |  |   | 441.5   |   |  |   | 408.7   |   |
|                    |  | $                      | 1,332.3 |   |  | $      | 1,297.2 |   |  | $      | 1,299.3 |   |
|                         |

|                             |  |               |        |        |  |        |        |        |  |        |        |        |  |  |
|-----------------------------|--|---------------|--------|--------|--|--------|--------|--------|--|--------|--------|--------|--|--|
|                        |  | December  31, |
|                        |  | 2005          |        | 2004   |  | 2003   |
| **Long-lived assets -net:** |  |          |   |   |  |   |   |   |  |   |   |   |
| United States               |  | $             | 366.9  |   |  | $      | 371.3  |   |  | $      | 392.9  |   |
| Canada                      |  |          | 3.8    |   |  |   | 4.2    |   |  |   | 3.9    |   |
| United States andCanada     |  |          | 370.7  |   |  |   | 375.5  |   |  |   | 396.8  |   |
| International               |  |          | 81.0   |   |  |   | 79.2   |   |  |   | 79.8   |   |
|                        |  | $             | 451.7  |   |  | $      | 454.7  |   |  | $      | 476.6  |   |
|                             |

|                                   |  |                        |         |        |  |        |         |        |  |        |         |        |  |  |
|-----------------------------------|--|------------------------|---------|--------|--|--------|---------|--------|--|--------|---------|--------|--|--|
|                              |  | Year Ended December31, |
|                              |  | 2005                   |         | 2004   |  | 2003   |
| **Classes ofsimilarproducts:**    |  |                   |    |   |  |   |    |   |  |   |    |   |
| Netsales:                         |  |                   |    |   |  |   |    |   |  |   |    |   |
| Cosmetics, skincare andfragrances |  | $                      | 904.3   |   |  | $      | 874.7   |   |  | $      | 872.4   |   |
| Personal care                     |  |                   | 428.0   |   |  |   | 422.5   |   |  |   | 426.9   |   |
|                              |  | $                      | 1,332.3 |   |  | $      | 1,297.2 |   |  | $      | 1,299.3 |   |
|                                   |

20.    SUBSEQUENTEVENTS

In February  2006, Revlon, Inc. announcedthat it had launched and plans to complete in March  2006, a$110  million rights offering that would allow stockholders topurchase additional shares of Class A Common Stock. Pursuant to therights offering, Revlon, Inc. distributed, at no charge, onetransferable subscription right for each share of Class A Common Stockand Class B Common Stock held by each stockholder of record as of 5:00p.m. Eastern Standard Time on February  13,  2006, the recorddate for the rights offering. Each subscription right entitles theholder of such right to purchase 0.1057 shares of Class A Common Stock.As there will be no fractional shares issued, a rights holder will needto hold at least ten subscription rights to acquire one share of ClassA Common Stock in the rights offering. The subscription price for eachshare of Class A Common Stock is $2.80 per share, which subscriptionprice was recommended by a committee of Revlon, Inc.'s Board ofDirectors composed solely of independent directors within the meaningof Section 303A.02 of the NYSE Listed Company Manual and theBoard's Guidelines for Assessing Director Independence andratified and confirmed by the Board of Directors (with Messrs.Perelman, Gittis and Drapkin recusing themselves as they are officersof MacAndrews & Forbes).

Under an over-subscriptionprivilege, each rights holder that exercises its basic subscriptionprivilege in full may also subscribe in the rights offering foradditional shares of Class A Common Stock at the same subscriptionprice of $2.80 per share, to the extent that other rights holders donot exercise their subscription rights in full. If a sufficient numberof shares are not available to fully satisfy the over-subscriptionprivilege requests, the available shares will be sold pro-rata amongsubscription rights holders who exercised their over-subscriptionprivilege, based on the number of shares each subscription rightsholder subscribed for under the basic subscription privilege.

MacAndrews & Forbes has agreed not to exercise its basicsubscription privilege. Instead pursuant to a Stock Purchase Agreementbetween MacAndrews & Forbes and Revlon, Inc., MacAndrews &

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Forbes has agreed to purchase at the same$2.80 subscription price, in a private placement directly from Revlon,Inc., the shares of Class A Common Stock that it would otherwise havebeen entitled to subscribe for pursuant to its basic subscriptionprivilege in the rights offering (equal to approximately 60% ofthe shares available for purchase in the rights offering, orapproximately $66  million). MacAndrews & Forbes also agreednot to exercise its over-subscription privilege in the rights offering,which will maximize the shares available for purchase by otherstockholders pursuant to their over-subscription privileges.

Ifany shares in the rights offering remain following the exercise of thebasic subscription privilege and the over-subscription privilege byrights holders other than MacAndrews & Forbes, MacAndrews &Forbes will back-stop the rights offering by purchasing at the same$2.80 subscription price, also in a private placement directly fromRevlon, Inc., the remaining shares of Class A Common Stock offered butnot purchased by other rights holders. As a result of this back-stop,Revlon, Inc. is assured of raising $110  million in gross proceedsthrough a combination of the rights offering and the sale of shares, ina private placement and, if necessary, the back-stop, to MacAndrews& Forbes.

Revlon, Inc. expects to transfer the proceeds fromthe rights offering to Products Corporation which it would use,together with available cash, to redeem approximately $110million aggregate principal amount of Products Corporation's8 5/8% Senior Subordinated Notes, in satisfactionof the applicable requirements under Products Corporation's 2004Credit Agreement.

Revlon, Inc. also announced in February2006 that it intends to conduct a further $75  million equityissuance through an underwritten public offering by June30,  2006. In connection with such further equity issuance,Revlon, Inc. also announced in February  2006 that it had enteredinto an amendment to its 2004 Investment Agreement with MacAndrews& Forbes, which extends MacAndrews & Forbes’ back-stopof Revlon, Inc.’s planned $75  million equity issuance fromMarch  31,  2006 until June  30,  2006 to, amongother things, provide Revlon, Inc. with sufficient time to complete,following the rights offering, an underwritten public offering of itsClass A Common Stock, the proceeds of which would be transferred byRevlon, Inc. to Products Corporation to be available for generalcorporate purposes. Revlon, Inc. also announced that ProductsCorporation had entered into an amendment to its 2004 ConsolidatedMacAndrews & Forbes Line of Credit extending the term of suchagreement until the consummation of Revlon, Inc.’s planned$75  million equity issuance.

Also in February  2006,Revlon, Inc. separately announced an organizational realignment largelyinvolving the consolidation of certain functions within its sales,marketing and creative groups, as well as certain headquartersfunctions, which changes are designed to streamline internal processes,enabling the Company to continue to be more effective and efficient inmeeting the needs of its consumers and retail customers. The Companyindicated that it expects to take a charge in 2006 of approximately$10  million to cover severance and other expenses associated withthe organizational realignment, with the vast majority of the charge toimpact results in the first quarter of 2006. The Company estimatessignificant ongoing annualized savings associated with theorganizational realignment.

Revlon, Inc. also announced inFebruary  2006 that Products Corporation had entered into anamendment to its 2004 Credit Agreement which enables ProductsCorporation to exclude, from various financial covenants, certaincharges in connection with the aforementioned organizationalrealignment, as well as some start-up investment charges incurred bythe Company in 2005 related to the launch of its new Vital Radiancebrand and the re-launch of Almay. Specifically, such amendment providesfor the add-back to the definition of‘‘EBITDA’’ the lesser of (i) $50  million;or (ii) the cumulative one-time charges associated with (a) theaforementioned organizational realignment; and (b) the non-recurringcosts in the third and fourth quarters of 2005 associated with thelaunch of the Company's new Vital Radiance brand and the re-launchof Almay. Under the 2004 Credit Agreement, such definition is used inthe determination of Products Corporation's senior securedleverage ratio (the ratio of Products Corporation’s SeniorSecured Debt to EBITDA, as each such term is defined in the 2004 CreditAgreement) and the consolidated fixed charge coverage ratio (the ratioof Products Corporation’s EBITDA minus Capital Expenditures toCash Interest Expense for such period, as each such term is defined inthe 2004 Credit Agreement).

F-47

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**ScheduleII**

REVLON, INC. AND SUBSIDIARIES

VALUATION AND QUALIFYING ACCOUNTS

YearsEnded December  31,  2005, 2004 and 2003

(dollars in millions)

|                                                  |  |                        |        |                           |  |                 |        |                     |  |        |        |           |  |        |        |        |  |  |
|--------------------------------------------------|--|------------------------|--------|---------------------------|--|-----------------|--------|---------------------|--|--------|--------|-----------|--|--------|--------|--------|--|--|
|                                             |  | BalanceatBeginningYear |        | Charged toCostandExpenses |  | OtherDeductions |        | Balance atEndofYear |
| **Year ended December 31,2005:**                 |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Appliedagainst assetaccounts:                    |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Allowance fordoubtful accounts                   |  | $                      | 5.6    |                      |  | $               | 0.6    |                |  | $      | (1.1)  | (1)  |  | $      | 5.1    |   |
| Allowance for volume and early payment discounts |  | $                      | 13.4   |                      |  | $               | 49.6   |                |  | $      | (49.2) | (2)  |  | $      | 13.8   |   |
| **Yearended December  31,2004:**                 |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Appliedagainst assetaccounts:                    |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Allowance fordoubtful accounts                   |  | $                      | 7.7    |                      |  | $               | (1.6   | )              |  | $      | (0.5)  | (1)  |  | $      | 5.6    |   |
| Allowance for volume and early payment discounts |  | $                      | 11.7   |                      |  | $               | 47.4   |                |  | $      | (45.7) | (2)  |  | $      | 13.4   |   |
| **Yearended December  31,2003:**                 |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Appliedagainst assetaccounts:                    |  |                   |   |                      |  |            |   |                |  |   |   |      |  |   |   |   |
| Allowance fordoubtful accounts                   |  | $                      | 15.8   |                      |  | $               | 3.2    |                |  | $      | (11.3) | (1)  |  | $      | 7.7    |   |
| Allowance for volume and early payment discounts |  | $                      | 8.2    |                      |  | $               | 40.4   |                |  | $      | (36.9) | (2)  |  | $      | 11.7   |   |
|                                                  |

|  |
|--|
|  |  |
|  |

Notes:

|     |                                                                                                               |
|-----|---------------------------------------------------------------------------------------------------------------|
| (1) | Doubtful accountswritten off, less recoveries, reclassifications and foreign currencytranslation adjustments. |

|     |                                                                                |
|-----|--------------------------------------------------------------------------------|
| (2) | Discounts taken,reclassifications and foreign currency translationadjustments. |

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d)of the Securities Exchange Act of 1934, the Registrant has duly causedthis report to be signed on its behalf by the undersigned, thereuntoduly authorized.

Revlon, Inc.(Registrant)

|                                                            |  |                                                                   |  |                                                                |  |  |  |  |  |  |
|------------------------------------------------------------|--|-------------------------------------------------------------------|--|----------------------------------------------------------------|--|--|--|--|--|--|
| By: /s/ Jack L.Stahl                                       |  | By: /s/ Thomas E. McGuire                                         |  | By: /s/ John F.Matsen, Jr.                                     |
| Jack L. StahlPresident,Chief ExecutiveOfficer and Director |  | Thomas E.McGuireExecutive VicePresident andChiefFinancial Officer |  | John F. Matsen, Jr.SeniorVice Presidentand CorporateController |
|                                                            |

Dated: March 2,2006

Pursuant to the requirements of theSecurities Exchange Act of 1934, this report has been signed by thefollowing persons on behalf of the Registrant on March 2, 2006 and inthe capacitiesindicated.

|                        |  |                                                |
|------------------------|--|------------------------------------------------|
|                        |  | SignatureTitle                                 |
|                        |
| *                      |  | Chairman of the Board andDirector              |
|                        |
| (Ronald O.Perelman)    |
|                        |
| *                      |  | Director                                       |
|                        |
| (HowardGittis)         |
|                        |
| *                      |  | Director                                       |
|                        |
| (Donald G. Drapkin)    |
|                        |
| /s/ Jack L.Stahl       |  | President, ChiefExecutive Officer and Director |
|                        |
| (Jack L. Stahl)        |
|                        |
| *                      |  | Director                                       |
|                        |
| (Alan S. Bernikow)     |
|                        |
| *                      |  | Director                                       |
|                        |
| (Paul J.Bohan)         |
|                        |
| *                      |  | Director                                       |
|                        |
| (Meyer Feldberg)       |
|                        |
| *                      |  | Director                                       |
|                        |
| (Edward J.Landau)      |
|                        |
| *                      |  | Director                                       |
|                        |
| (Debra L. Lee)         |
|                        |
| *                      |  | Director                                       |
|                        |
| (Linda GosdenRobinson) |
|                        |
| *                      |  | Director                                       |
|                        |
| (Kathi P. Seifert)     |
|                        |
| *                      |  | Director                                       |
|                        |
| (Kenneth L.Wolfe)      |
|                        |

|         |                                                                                                                                                                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *  | Robert K. Kretzman, by signinghis name hereto, does hereby sign this report on behalf of thedirectors of the registrant above whose typed names asterisks appear,pursuant to powers of attorney duly executed by such directors andfiled with the Securities and Exchange Commission. |

|                                    |  |        |  |  |  |  |
|------------------------------------|--|--------|--|--|--|--|
| By: /s/ Robert K. Kretzman         |  |   |
| Robert K. KretzmanAttorney-in-fact |  |   |
|                                    |

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