EX-4.10





 Exhibit 4.10 

COPA HOLDINGS, S.A. 
 2005 STOCK
INCENTIVE PLAN 
 1. PURPOSE OF THE PLAN 
 The
purpose of the Plan is to aid the Company and its Affiliates in recruiting and retaining key employees, directors or consultants of outstanding ability and to motivate such employees, directors or consultants to exert their best efforts on behalf of
the Company and its Affiliates by providing incentives through the granting of Awards. The Company expects that it will benefit from the added interest which such key employees, directors or consultants will have in the welfare of the Company as a
result of their proprietary interest in the Company’s success. 
 2. DEFINITIONS 

The following capitalized terms used in the Plan have the respective meanings set forth in this Section: 

 

	 	(a)	 Act: The U.S. Securities Exchange Act of 1934, as amended, or any successor thereto. 



 

	 	(b)	 Affiliate: With respect to the Company, any entity directly or indirectly controlling, controlled by, or under
common control with, the Company or any other entity designated by the Board in which the Company or an Affiliate has an interest. 


  

	 	(c)	 Award: An Option, Stock Appreciation Right or Other Stock-Based Award granted pursuant to the Plan.



  

	 	(d)	 Beneficial Owner: A “beneficial owner”, as such term is defined in Rule 13d-3 under the Act (or any successor rule thereto). 


  

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



 

	 	(f)	 Change in Control: The occurrence of any of the following events: 



(i) the sale or disposition, in one or a series of related transactions, of all or substantially all, of the assets of the Company to any
“person” or “group” (as such terms are defined in Sections 13(d)(3) or 14(d)(2) of the Act) other than the Permitted Holders; 

(ii) any person or group, other than the Permitted Holders, is or becomes the Beneficial Owner (except that a person shall be deemed to have
“beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total voting power of the
voting stock of the Company (or any entity which controls the Company), including by way of merger, consolidation, tender or exchange offer or otherwise; or 












 (iii) during any period of two consecutive years, individuals who at the beginning of such
period constituted the Board (together with any new directors whose election by such Board or whose nomination for election by the shareholders of the Company was approved by a vote of a majority of the directors of the Company, then still in
office, who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board, then in office. 

 

	 	(g)	 Code: The Internal Revenue Code of 1986, as amended, or any successor thereto. 



 

	 	(h)	 Committee: The Compensation Committee of the Board. 



 

	 	(i)	 Company: Copa Holdings, S.A., a corporation organized under the laws of the Republic of Panama.



  

	 	(j)	 Effective Date: The date the Board approves the Plan, or such later date as is designated by the Board.



  

	 	(k)	 Employment: The term “Employment” as used herein shall be deemed to refer to (i) a
Participant’s employment if the Participant is an employee of the Company or any of its Affiliates, (ii) a Participant’s services as a consultant, if the Participant is consultant to the Company or its Affiliates and (iii) a
Participant’s services as an non-employee director, if the Participant is a non-employee member of the Board. 



 

	 	(l)	 Fair Market Value: On a given date, (i) if there should be a public market for the Shares on such date,
the arithmetic mean of the high and low prices of the Shares as reported on such date on the Composite Tape of the principal national securities exchange on which such Shares are listed or admitted to trading, or, if the Shares are not listed or
admitted on any national securities exchange, the arithmetic mean of the per Share closing bid price and per Share closing asked price on such date as quoted on the National Association of Securities Dealers Automated Quotation System (or such
market in which such prices are regularly quoted) (the “NASDAQ”), or, if no sale of Shares shall have been reported on the Composite Tape of any national securities exchange or quoted on the NASDAQ on such date, then the immediately
preceding date on which sales of the Shares have been so reported or quoted shall be used; provided that, in the event of an initial public offering of the Shares of the Company, the Fair Market Value on the date of such initial public offering
shall be the price at which the initial public offering was made, and (ii) if there should not be a public market for the Shares on such date, the Fair Market Value shall be the value established by the Committee in good faith.




  
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	 	(m)	 ISO: An Option that is an incentive stock option granted pursuant to Section 6(d) of the Plan.



  

	 	(n)	 Other Stock-Based Awards: Awards granted pursuant to Section 8 of the Plan. 



 

	 	(o)	 Option: A stock option granted pursuant to Section 6 of the Plan. 



 

	 	(p)	 Option Price: The purchase price per Share of an Option, as determined pursuant to Section 6(a) of the
Plan. 


  

	 	(q)	 Participant: An employee, director or consultant who is selected by the Committee to participate in the Plan.



  

	 	(r)	 Permitted Holder means, as of the date of determination, any and all of Corporacion de Inversiones Aereas,
S.A., Continential Airlines, Inc. or any of their respective Affiliates. 


  

	 	(s)	 Person: A “person”, as such term is used for purposes of Section 13(d) or 14(d) of the Act (or any
successor section thereto). 


  

	 	(t)	 Section 409A: Section 409A of the Code (and any related regulations or other pronouncements thereunder).



  

	 	(u)	 Plan: This Copa Holdings, S.A. 2005 Stock Incentive Plan. 



 

	 	(v)	 Shares: Shares of Class A common stock of the Company. 



 

	 	(w)	 Stock Appreciation Right: A stock appreciation right granted pursuant to Section 7 of the Plan.



  

	 	(x)	 Subsidiary: A subsidiary corporation, as defined in Section 424(f) of the Code (or any successor section
thereto). 


 3. SHARES SUBJECT TO THE PLAN 

The total number of Shares which may be issued under the Plan is 2,187,500. The Shares may consist, in whole or in part, of unissued Shares or
treasury Shares. The issuance of Shares or the payment of cash upon the exercise of an Award or in consideration of the cancellation or termination of an Award shall reduce the total number of Shares available under the Plan, as applicable. Shares
which are subject to Awards which terminate or lapse without the payment of consideration may be granted again under the Plan. 

  
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 4. ADMINISTRATION 

The Plan shall be administered by the Committee, which may delegate its duties and powers in whole or in part to any subcommittee thereof.
Awards may, in the discretion of the Committee, be made under the Plan in assumption of, or in substitution for, outstanding awards previously granted by the Company or its affiliates or a company acquired by the Company or with which the Company
combines. The number of Shares underlying such substitute awards shall be counted against the aggregate number of Shares available for Awards under the Plan. The Committee is authorized to interpret the Plan, to establish, amend and rescind any
rules and regulations relating to the Plan, and to make any other determinations that it deems necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in
the Plan in the manner and to the extent the Committee deems necessary or desirable. Any decision of the Committee in the interpretation and administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall
be final, conclusive and binding on all parties concerned (including, but not limited to, Participants and their beneficiaries or successors). The Committee shall have the full power and authority to establish the terms and conditions of any Award
consistent with the provisions of the Plan and to waive any such terms and conditions at any time (including, without limitation, accelerating or waiving any vesting conditions). The Committee shall require payment of any amount it may determine to
be necessary to withhold for federal, state, local or other taxes as a result of the exercise, grant or vesting of an Award. Unless the Committee specifies otherwise, the Participant may elect to pay a portion or all of such withholding taxes by
(a) delivery in Shares or (b) having Shares withheld by the Company from any Shares that would have otherwise been received by the Participant. 

5. LIMITATIONS 
 No Award may be granted under
the Plan after the tenth anniversary of the Effective Date, but Awards theretofore granted may extend beyond that date. 
 6. TERMS AND CONDITIONS OF
OPTIONS 
 Options granted under the Plan shall be, as determined by the Committee, non-qualified or
incentive stock options for federal income tax purposes, as evidenced by the related Award agreements, and shall be subject to the foregoing and the following terms and conditions and to such other terms and conditions, not inconsistent therewith,
as the Committee shall determine: 
  

	 	(a)	 Option Price. The Option Price per Share shall be determined by the Committee. 



 

	 	(b)	 Exercisability. Options granted under the Plan shall be exercisable at such time and upon such terms and
conditions as may be determined by the Committee, but in no event shall an Option be exercisable more than ten years after the date it is granted. 



  
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	 	(c)	 Exercise of Options. Except as otherwise provided in the Plan or in an Award agreement, an Option may be
exercised for all, or from time to time any part, of the Shares for which it is then exercisable. For purposes of Section 6 of the Plan, the exercise date of an Option shall be the later of the date a notice of exercise is received by the
Company and, if applicable, the date payment is received by the Company pursuant to clauses (i), (ii), (iii) or (iv) in the following sentence. The purchase price for the Shares as to which an Option is exercised shall be paid to the Company in
full at the time of exercise at the election of the Participant (i) in cash or its equivalent (e.g., by check), (ii) to the extent permitted by the Committee, in Shares having a Fair Market Value equal to the aggregate Option Price for the
Shares being purchased and satisfying such other requirements as may be imposed by the Committee; provided, that such Shares have been held by the Participant for no less than six months (or such other period as established from time to time by the
Committee in order to avoid adverse accounting treatment applying generally accepted accounting principles), (iii) partly in cash and, to the extent permitted by the Committee, partly in such Shares or (iv) if there is a public market for the
Shares at such time, through the delivery of irrevocable instructions to a broker to sell Shares obtained upon the exercise of the Option and to deliver promptly to the Company an amount out of the proceeds of such Sale equal to the aggregate Option
Price for the Shares being purchased. No Participant shall have any rights to dividends or other rights of a stockholder with respect to Shares subject to an Option until the Participant has given written notice of exercise of the Option, paid in
full for such Shares and, if applicable, has satisfied any other conditions imposed by the Committee pursuant to the Plan. 


  

	 	(d)	 ISOs. The Committee may grant Options under the Plan that are intended to be ISOs. Such ISOs shall comply with
the requirements of Section 422 of the Code (or any successor section thereto). No ISO may be granted to any Participant who at the time of such grant, owns more than ten percent of the total combined voting power of all classes of stock of the
Company or of any Subsidiary, unless (i) the Option Price for such ISO is at least 110% of the Fair Market Value of a Share on the date the ISO is granted and (ii) the date on which such ISO terminates is a date not later than the day
preceding the fifth anniversary of the date on which the ISO is granted. Any Participant who disposes of Shares acquired upon the exercise of an ISO either (i) within two years after the date of grant of such ISO or (ii) within one year
after the transfer of such Shares to the Participant, shall notify the Company of such disposition and of the amount realized upon such disposition. All Options granted under the Plan are intended to be nonqualified stock options, unless the
applicable Award agreement expressly states that the Option is intended to be an ISO. If an Option is intended to be an ISO, and if for any reason such Option (or portion thereof) shall not qualify as an ISO, then, to the extent of such
nonqualification, such Option (or portion thereof) shall be 



  
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regarded as a nonqualified stock option granted under the Plan; provided that such Option (or potion thereof) otherwise complies with the Plan’s requirements relating to nonqualified stock
options. In no event shall any member of the Committee, the Company or any of its Affiliates (or their respective employees, officers or directors) have any liability to any Participant (or any other Person) due to the failure of an Option to
qualify for any reason as an ISO. 

  

	 	(e)	 Attestation. Wherever in this Plan or any agreement evidencing an Award a Participant is permitted to pay the
exercise price of an Option or taxes relating to the exercise of an Option by delivering Shares, the Participant may, subject to procedures satisfactory to the Committee, satisfy such delivery requirement by presenting proof of beneficial ownership
of such Shares, in which case the Company shall treat the Option as exercised without further payment and shall withhold such number of Shares from the Shares acquired by the exercise of the Option. 



7. TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS 
  

	 	(a)	 Grants. Subject to Section 17 of the Plan, the Committee also may grant (i) a Stock Appreciation
Right independent of an Option or (ii) a Stock Appreciation Right in connection with an Option, or a portion thereof. A Stock Appreciation Right granted pursuant to clause (ii) of the preceding sentence (A) may be granted at the time
the related Option is granted or at any time prior to the exercise or cancellation of the related Option, (B) shall cover the same number of Shares covered by an Option (or such lesser number of Shares as the Committee may determine) and
(C) shall be subject to the same terms and conditions as such Option except for such additional limitations as are contemplated by this Section 7 (or such additional limitations as may be included in an Award agreement).



  

	 	(b)	 Terms. The exercise price per Share of a Stock Appreciation Right shall be an amount determined by the
Committee but in no event shall such amount be less than the greater of (i) the Fair Market Value of a Share on the date the Stock Appreciation Right is granted or, in the case of a Stock Appreciation Right granted in conjunction with an
Option, or a portion thereof, the Option Price of the related Option and (ii) the minimum amount permitted by applicable laws, rules, by-laws or policies of regulatory authorities or stock exchanges. Each
Stock Appreciation Right granted independent of an Option shall entitle a Participant upon exercise to an amount equal to (i) the excess of (A) the Fair Market Value on the exercise date of one Share over (B) the exercise price per
Share, times (ii) the number of Shares covered by the Stock Appreciation Right. Each Stock Appreciation Right granted in conjunction with an Option, or a portion thereof, shall entitle a Participant to surrender to the Company the unexercised
Option, or any portion thereof, and to receive from the Company in exchange therefore an amount equal to (i) the excess of 



  
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(A) the Fair Market Value on the exercise date of one Share over (B) the Option Price per Share, times (ii) the number of Shares covered by the Option, or portion thereof, which is
surrendered. The date a notice of exercise is received by the Company shall be the exercise date. Payment shall be made in Shares or in cash, or partly in Shares and partly in cash (any such Shares valued at such Fair Market Value), all as shall be
determined by the Committee. Stock Appreciation Rights may be exercised from time to time upon actual receipt by the Company of written notice of exercise stating the number of Shares with respect to which the Stock Appreciation Right is being
exercised. No fractional Shares will be issued in payment for Stock Appreciation Rights, but instead cash will be paid for a fraction or, if the Committee should so determine, the number of Shares will be rounded downward to the next whole Share.


  

	 	(c)	 Limitations. The Committee may impose, in its discretion, such conditions upon the exercisability or
transferability of Stock Appreciation Rights as it may deem fit. 


 8. OTHER STOCK-BASED AWARDS 

Subject to Section 17 of the Plan, the Committee, in its sole discretion, may grant or sell Awards of Shares, Awards of restricted Shares
and Awards that are valued in whole or in part by reference to, or are otherwise based on the Fair Market Value of, Shares (“Other Stock-Based Awards”). Such Other Stock-Based Awards shall be in such form, and dependent on such conditions,
as the Committee shall determine, including, without limitation, the right to receive, or vest with respect to, one or more Shares (or the equivalent cash value of such Shares) upon the completion of a specified period of service, the occurrence of
an event and/or the attainment of performance objectives. Other Stock-Based Awards may be granted alone or in addition to any other Awards granted under the Plan. Subject to the provisions of the Plan, the Committee shall determine to whom and when
Other Stock-Based Awards will be made, the number of Shares to be awarded under (or otherwise related to) such Other Stock-Based Awards; whether such Other Stock-Based Awards shall be settled in cash, Shares or a combination of cash and Shares; and
all other terms and conditions of such Awards (including, without limitation, the vesting provisions thereof and provisions ensuring that all Shares so awarded and issued shall be fully paid and
non-assessable). 
 9. ADJUSTMENTS UPON CERTAIN EVENTS 

Notwithstanding any other provisions in the Plan to the contrary, the following provisions shall apply to all Awards granted under the Plan:

  

	 	(a)	 Generally. In the event of any change in the outstanding Shares after the Effective Date by reason of any Share
dividend or split, reorganization, recapitalization, merger, consolidation, spin-off, combination, combination or transaction or exchange of Shares or other corporate exchange, or any distribution to
shareholders of Shares other than regular cash dividends or any transaction similar to the foregoing, the Committee 



  
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in its sole discretion and without liability to any person may make such substitution or adjustment, if any, as it deems to be equitable, as to (i) the number or kind of Shares or other
securities issued or reserved for issuance pursuant to the Plan or pursuant to outstanding Awards, (ii) the Option Price or exercise price of any stock appreciation right and/or (iii) any other affected terms of such Awards. 


 

	 	(b)	 Change in Control. In the event of a Change of Control after the Effective Date, (i) [if determined by the
Committee in the applicable Award agreement or otherwise,] any outstanding Awards then held by Participants which are unexercisable or otherwise unvested or subject to lapse restrictions shall automatically be deemed exercisable or otherwise vested
or no longer subject to lapse restrictions, as the case may be, as of immediately prior to such Change of Control and (ii) the Committee may, but shall not be obligated to, (A) cancel such Awards for fair value (as determined in the sole
discretion of the Committee) which, in the case of Options and Stock Appreciation Rights, may equal the excess, if any, of value of the consideration to be paid in the Change of Control transaction to holders of the same number of Shares subject to
such Options or Stock Appreciation Rights (or, if no consideration is paid in any such transaction, the Fair Market Value of the Shares subject to such Options or Stock Appreciation Rights) over the aggregate exercise price of such Options or Stock
Appreciation Rights, (B) provide for the issuance of substitute Awards that will substantially preserve the otherwise applicable terms of any affected Awards previously granted hereunder as determined by the Committee in its sole discretion or
(C) provide that for a period of at least 15 days prior to the Change of Control, such Options shall be exercisable as to all shares subject thereto and that upon the occurrence of the Change of Control, such Options shall terminate and be of
no further force and effect. 


 10. NO RIGHT TO EMPLOYMENT OR AWARDS 

The granting of an Award under the Plan shall impose no obligation on the Company or any Subsidiary to continue the Employment of a Participant
and shall not lessen or affect the Company’s or Subsidiary’s right to terminate the Employment of such Participant. No Participant or other Person shall have any claim to be granted any Award, and there is no obligation for uniformity of
treatment of Participants, or holders or beneficiaries of Awards. The terms and conditions of Awards and the Committee’s determinations and interpretations with respect thereto need not be the same with respect to each Participant (whether or
not such Participants are similarly situated). 
 11. SUCCESSORS AND ASSIGNS 

The Plan shall be binding on all successors and assigns of the Company and a Participant, including without limitation, the estate of such
Participant and the executor, administrator or trustee of such estate, or any receiver or trustee in bankruptcy or representative of the Participant’s creditors. 

  
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 12. NONTRANSFERABILITY OF AWARDS 

Unless otherwise determined by the Committee, an Award shall not be transferable or assignable by the Participant otherwise than by will or by
the laws of descent and distribution. An Award exercisable after the death of a Participant may be exercised by the legatees, personal representatives or distributees of the Participant. 

13. AMENDMENTS OR TERMINATION 
 The Board may
amend, alter or discontinue the Plan, but no amendment, alteration or discontinuation shall be made, (a) without the approval of the shareholders of the Company, if such action would (except as is provided in Section 9 of the Plan),
increase the total number of Shares reserved for the purposes of the Plan or change the maximum number of Shares for which Awards may be granted to any Participant or (b) without the consent of a Participant, if such action would diminish any
of the rights of the Participant under any Award theretofore granted to such Participant under the Plan; provided, however, that the Committee may amend the Plan in such manner as it deems necessary to permit the granting of Awards meeting the
requirements of the Code or other applicable laws. 
 14. INTERNATIONAL PARTICIPANTS 

With respect to Participants who reside or work outside the Republic of Panama or the United States of America, the Committee may, in its sole
discretion, amend the terms of the Plan or Awards with respect to such Participants in order to conform such terms with the requirements of local law. 

15. CHOICE OF LAW 
 The Plan shall be governed by
and construed in accordance with the laws of the Republic of Panama without regard to conflicts of laws. 
 16. EFFECTIVENESS OF THE PLAN 

The Plan shall be effective as of the Effective Date, subject to the approval of the shareholders of the Company. 

17. SECTION 409A 
 No Award shall be granted,
deferred, paid out or modified under this Plan in a manner that would result in the imposition of a penalty tax under Section 409A upon a Participant. In the event that it is reasonably determined by the Committee that, as a result of
Section 409A, payments in respect of any Award under the Plan may not be made at the time contemplated by the terms of the Plan or the relevant Award agreement, as the case may be, without causing the Participant holding such Award to be
subject to an income tax penalty under Section 409A, the Company will make such payment on the first day that would not result in the 

  
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Participant incurring any tax liability under Section 409A. In addition, other provisions of the Plan or any Award agreements thereunder notwithstanding, the Company shall have no right to
accelerate any payment in respect of an Award or to make any such payment as the result of an event if such payment would, as a result, be subject to the tax imposed by Section 409A. 

  
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