Document:

Employee Stock Option and Incentive Plan, amended and restated

 Exhibit 10.19.6 
  
 AVERY DENNISON CORPORATION 
 EMPLOYEE STOCK OPTION AND INCENTIVE PLAN 
 amended and restated 
  
 The purposes of this Plan are as follows: 
  
 (1) To provide additional incentive for Employees to further the growth, development and
financial success of the Company by personally benefiting through the ownership of Company stock and/or rights, which recognize such growth, development and financial success. 
  
 (2) To enable the Company to recruit and retain Employees considered essential to the long range success of the Company by offering them an
opportunity to own stock in the Company and/or rights, which will reflect the growth, development and financial success of the Company. 
  
 ARTICLE 1 DEFINITIONS 
  
 Wherever the following terms are used in this Plan they shall have the meaning specified below, unless the context clearly indicates otherwise.

  
 1.1 Award 
  
 “Award” shall mean a Dividend Equivalent, Option,
Restricted Stock, Restricted Stock Unit, or Stock Appreciation Right granted under this Plan. 
  
 1.2 Award Agreement 
  
 “Award Agreement” shall mean an agreement setting forth the terms and conditions of an Award. 
  
 1.3 Awardee 
  
 “Awardee” shall mean a person who has received an Award
under the Plan. 
  
 1.4 Beneficiary

  
 “Beneficiary” shall have the meaning
given in Article 11.8. 
  
 1.5 Board

  
 “Board” shall mean the Board of
Directors of the Company. 
  
 1.6 Cause

  
 “Cause” shall mean, with respect to any
Awardee’s Termination of Employment, unless otherwise provided by the Committee, (i) “Cause” as defined in any Individual Agreement or Award Agreement to which the applicable Awardee is a party, or (ii) if there is no such Individual
Agreement or Award Agreement or if it does not define Cause: (A) conviction of the Awardee for committing a felony under federal law or the law of the state in which such action occurred, (B) willful and deliberate failure on the part of the Awardee
to perform his employment duties in any material respect, or (C) prior to a Change in Control, such other serious events as shall be determined by the Committee. Prior to a Change of Control, the Committee shall, unless otherwise provided in an
Individual Agreement with a particular Awardee, have the discretion to determine whether “Cause” exists, and its determination shall be final. 
  
 1.7 Change in Control 
  
 “Change in Control” has the meanings set forth in Article 9.2. 
  
 1.8 CEO 
  
 “CEO” shall mean the Chief Executive Officer of the Company. 
  

 1 

 1.9 Code 
  
 “Code” shall mean the Internal Revenue Code of 1986, as amended. 
  
 1.10 Committee 
  
 “Committee” shall mean committee of the Board designated to
administer the Plan as contemplated by Article 10.1. 
  
 1.11 Commission 
  
 “Commission”
shall mean the Securities and Exchange Commission or any successor agency. 
  
 1.12 Common Stock 
  
 “Common Stock” shall mean the common stock of the Company. 
  
 1.13 Company 
  
 “Company” shall mean Avery Dennison Corporation or any successor company. 
  
 1.14 COO 
  
 “COO” shall mean the Chief Operating Officer of the
Company. 
  
 1.15 Covered Employee

  
 “Covered Employee” shall mean an Awardee
designated by the Committee in connection with any Award as an individual who is or may be a “covered employee” within the meaning of Section 162(m)(3) of the Code in the year in which an Award is expected to be taxable to such Awardee.

  
 1.16 Director 
  
 “Director” shall mean a member of the Board. 
  
 1.17 Disability 
  
 “Disability” shall mean, with respect to any Awardee,
unless otherwise provided by the Committee, (i) “Disability” as defined in any Individual Agreement or Award Agreement to which the Awardee is a party, or (ii) if there is no such Individual Agreement or it does not define
“Disability,” permanent and total disability as defined in Section 22(c)3 of the Code. 
  
 1.18 Disaffiliation 
  
 “Disaffiliation” shall mean, with respect to any Subsidiary, the Subsidiary’s ceasing to be a Subsidiary for any reason (including,
without limitation, as a result of a public offering, or a spin-off or sale by the Company, of the majority of the stock of the Subsidiary). 
  
 1.19 Dividend Equivalent 
  
 “Dividend Equivalent” shall mean a right to receive a number of shares of Common Stock or an amount of cash, determined as provided in
Article 8.1 hereof. 
  
 1.20 Early Retirement

  
 “Early Retirement” shall mean retirement
from active employment with the Company, or a Subsidiary, pursuant to the early retirement provisions of the applicable pension plan of such employer or as otherwise determined by the Committee. 
  
 1.21 Employee 
  
 “Employee” shall mean any officer or other employee of the
Company, or of any corporation, which is then a Subsidiary. 
  
 1.22 Expiration Date 
  
 “Expiration Date” shall have the meaning given in Article 4.3. 
  

 2 

 1.23 Exchange Act 
  
 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
  
 1.24 Fair Market Value 
  
 “Fair Market Value” of a share of Common Stock as of a
given date shall be (i) the mean between the highest and lowest selling price of a share of Common Stock during normal business hours on the principal exchange on which shares of Common Stock are then trading, if any, on such date, or if shares were
not traded on such date, then the weighted average of the means between the highest and lowest sales upon the nearest date before and the nearest date after such valuation date; or (ii) if Common Stock is not traded on an exchange, the mean between
the closing representative bid and asked prices for the Common Stock during normal business hours on such date as reported by NASDAQ or, if NASDAQ is not then in existence, by its successor quotation system; or (iii) if Common Stock is not publicly
traded, the Fair Market Value of a share of Common Stock as established by the Committee acting in good faith. 
  
 1.25 Incentive Stock Option 
  
 “Incentive Stock Option” shall mean an Option that both meets the requirements to be an “incentive stock option” under Section
422A of the Code and is designated as an Incentive Stock Option by the Committee. 
  
 1.26 including or includes 
  
 “including” or “includes” shall mean including without limitation, or includes, without limitation. 
  
 1.27 Individual Agreement 
  
 “Individual Agreement” shall mean an employment, severance
or similar agreement between an Awardee and the Company or one of its Subsidiaries. 
  
 1.28 Involuntary Termination 
  
 “Involuntary Termination” shall mean Termination of Employment other than for Cause, death, Disability, Retirement or voluntary
termination by the Awardee. 
  
 1.29
Non-Qualified Stock Option 
  
 “Non-Qualified Stock
Option” shall mean an Option that either is not an Incentive Stock Option or is designated as a Non-Qualified Stock Option by the Committee. 
  
 1.30 Normal Retirement 
  
 “Normal Retirement” shall mean retirement from active employment with the Company, or a Subsidiary at or after age 62. 
  
 1.31 Option 
  
 “Option” shall mean a stock option granted pursuant to this
Plan. 
  
 1.32 Optionee 
  
 “Optionee” shall mean an Employee granted an Option under
this Plan. 
  
 1.33 Performance Goals

  
 “Performance Goals” shall mean the
performance goals established by the Committee in connection with the grant of Restricted Stock or Restricted Stock Units. In the case of Qualified Performance-Based Awards, (i) such goals shall be based on the attainment of specified levels of one
or more of the following measures: earnings per share, sales, net income, net income after tax, gross income, operating income, cash generation, economic value added, unit volume, return on equity, return on assets, change in working capital, return
on capital or stockholder return, and (ii) such Performance Goals shall be set by the Committee within the time period prescribed by Section 162(m) of the Code and related regulations. 
  
 1.34 Plan 
  

“Plan” shall mean the Employee Stock Option and Incentive Plan, as amended and restated. 
  

 3 

 1.35 Qualified Performance-Based Award 
  
 “Qualified Performance-Based Award” shall mean an Award of
Restricted Stock or Restricted Stock Units designated as such by the Committee at the time of grant, based upon a determination that (i) the Awardee is or may be a “covered employee” within the meaning of Section 162(m)(3) of the Code in
the year in which the Company would expect to be able to claim a tax deduction with respect to such Restricted Stock and (ii) the Committee wishes such Award to qualify for the Section 162(m) Exemption. Notwithstanding any other provision of the
Plan, no Award shall be considered a Qualified Performance-Based Award unless it is granted subject to or after obtaining stockholder approval satisfying the requirements of Section 162(m)(4)(C)(ii) of the Code and the Treasury Regulations
thereunder. 
  
 1.36 Restricted Stock

  
 “Restricted Stock” shall mean Common
Stock issued pursuant to Article 7. 
  
 1.37
Restricted Stock Unit 
  
 “Restricted Stock
Unit” shall mean a right to receive Common Stock or a cash payment based on the value of Common Stock granted pursuant to Article 7. 
  
 1.38 Retirement 
  
 “Retirement” shall mean Normal or Early Retirement. 
  
 1.39 Rule 16b-3 
  
 “Rule 16b-3” shall mean Rule 16b-3, as promulgated by the Commission under Section 16(b) of the Exchange
Act, as amended from time to time. 
  
 1.40
Secretary 
  
 “Secretary” shall mean the
Secretary of the Company. 
  
 1.41 Section
162(m) Exemption 
  
 “Section 162(m)
Exemption” shall mean the exemption from the limitation on deductibility imposed by Section 162(m) of the Code that is set forth in Section 162(m)(4)(C) of the Code. 
  
 1.42 Stock Appreciation Right 
  
 “Stock Appreciation Right” shall mean a stock appreciation right granted under this Plan. 
  
 1.43 Subsidiary 
  
 “Subsidiary” shall mean any corporation in an unbroken
chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing 33 percent or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain, as well as partnerships and limited liability companies, in which the Company holds a 33 percent or more interest. 
  
 1.44 Termination of Employment 
  
 “Termination of Employment” of an Awardee shall mean the termination of the employee-employer relationship between the Awardee and the
Company or a Subsidiary for any reason, including a termination by resignation, discharge, death, Disability or Retirement; but excluding (a) terminations where there is a simultaneous reemployment or continuing employment by the Company or a
Subsidiary and (b) temporary absences from employment because of illness, vacation or leave of absence and transfers among the Company and Subsidiaries. In addition, an Awardee employed by a Subsidiary shall be deemed to incur a Termination of
Employment upon a Disaffiliation of that Subsidiary, unless the Awardee immediately thereafter becomes or remains an Employee of the Company or one of its continuing Subsidiaries. The Committee or the Company shall determine the effect of all other
matters and questions relating to Termination of Employment. 
  

 4 

 1.45 Gender and Number 
  
 “Gender and Number” Wherever the masculine gender is used
it shall include the feminine and neuter, and wherever a singular pronoun is used it shall include the plural, unless the context clearly indicates otherwise. 
  

ARTICLE 2 SHARES SUBJECT TO PLAN 
  
 2.1 Shares Subject to Plan 
  
 As of December 31, 2004, there were 635,835 shares available for future Awards under the Plan. As of the Effective Date, as defined in Article 11.13 below
and subject to stockholder approval, the aggregate number of shares deliverable pursuant to Awards shall be increased by 4,500,000 for a total of 5,135,835 shares. Shares of Common Stock issued under the Plan may be authorized and unissued shares,
previously outstanding shares held as treasury shares, or treasury shares that have been transferred to and held in a grantor trust of the Company. 
  
 2.2 Unexercised Options and Other Rights 
  

If any Option, or other right to acquire shares of Common Stock under any other Award expires or is cancelled without having been fully exercised, the
number of shares subject to such Option or other right, but as to which such Option or other right was not exercised prior to its expiration or cancellation, may again be optioned, granted or awarded hereunder, subject to the limitations of Article
2.1. 
  
 ARTICLE 3 GRANTING OF OPTIONS 
  
 3.1 Eligibility 
  
 Options may be granted to Employees of the Company or of a Subsidiary.

  
 3.2 Granting of Options 
  
 The Committee shall from time to time, in its discretion: 
  
 (i) Select the Employees who will be granted Options;

  
 (ii) Determine the number of shares to be
subject to such Options granted to the selected Employees; provided, however, that no Employee shall be granted Options covering in excess of 400,000 shares during any calendar year; and 
  
 (iii) Determine the terms and conditions of such Options, consistent with this Plan (including whether they
are Incentive Stock Options or Non-Qualified Stock Options). 
  
 ARTICLE 4
TERMS OF OPTIONS 
  
 4.1 Option Agreement

  
 Each Option and the terms and conditions thereof shall be
evidenced by an Award Agreement, which shall be executed by the Optionee and an authorized officer of the Company. Upon grant of an Option, the Committee shall instruct the Secretary to issue an Award Agreement evidencing such Option, and to deliver
such Award Agreement to the Optionee. 
  
 4.2
Option Price 
  
 The exercise price per share of the shares
subject to each Option shall be not less than 100% of the Fair Market Value of a share of Common Stock on the date the Option is granted. Once Options are granted, they may not be repriced, and this Article 4.2 may not be amended without the consent
of the stockholders. 
  
 4.3 Option Term

  
 The term of an Option shall be set by the Committee in
its discretion. The last day of the term of the Option shall be the Option’s “Expiration Date.” 
  

 5 

 4.4 Option Vesting 
  
 (a) The period during which the right to exercise an Option in whole or in part vests in the Optionee shall be set by the
Committee (and Option vesting shall be set forth in Award Agreements), and the Committee may determine that an Option may not be exercised in whole or in part for a specified period after it is granted. At any time after grant of an Option the
Committee may, in its sole discretion and subject to whatever terms and conditions it selects, accelerate the period during which an Option vests or extend the period during which it may be exercised (but not beyond the Expiration Date thereof).

  
 (b) No portion of an Option, which is unexercisable at
Termination of Employment, shall thereafter become exercisable. 
  
 4.5 Exercise of Options after Termination of Employment 
  
 (a) Termination by Death. Unless otherwise determined by the Committee, if an Optionee has a Termination of Employment by reason of the
Optionee’s death, any Option held by such Optionee may thereafter be exercised by the Optionee’s Beneficiaries, to the extent then exercisable, or on such accelerated basis as the Committee may determine, for a period of 12 months (or such
other period as the Committee may specify in the applicable Award Agreement) from the date of such death or until the Expiration Date thereof, whichever period is the shorter. 
  
 (b) Termination by Reason of Disability. Unless otherwise determined by the Committee, if an Optionee has a
Termination of Employment by reason of the Optionee’s Disability, any Option held by such Optionee may thereafter be exercised by the Optionee, to the extent it was exercisable immediately before the Termination of Employment, or on such
accelerated basis as the Committee may determine, for a period of three years (or such shorter period as the Committee may specify in the applicable Award Agreement) from the date of such Termination of Employment or until the Expiration Date
thereof, whichever period is the shorter; provided, however, that if the Optionee dies within such period, any unexercised Stock Option held by such Optionee shall, notwithstanding the expiration of such period, continue to be exercisable to
the extent to which it was exercisable at the time of death for a period of 12 months from the date of such death or until the Expiration Date thereof, whichever period is the shorter. 
  
 (c) Termination by Reason of Retirement. Unless otherwise determined by the Committee in an Award Agreement, if an
Optionee has a Termination of Employment by reason of the Optionee’s Retirement, any Option held by such Optionee may thereafter be exercised by the Optionee, to the extent it was exercisable at the time of such Retirement, or on such
accelerated basis as the Committee may determine, as follows: (i) if the Optionee has been before such Retirement, the CEO or the COO, for the period ending on the Expiration Date of such Option; (ii) if the Optionee has been before such Retirement,
a participant in the Company’s Long Term Incentive Program or any successor thereto, other than the CEO or the COO, for the period ending on the earlier of the fifth anniversary of such Retirement or the Expiration Date of such Option; and
(iii) in all other cases, for a period ending on the earlier of the third anniversary of such Retirement or the Expiration Date of such Stock Option; provided, however, that if the Optionee dies within such period any unexercised Option held
by such Optionee shall, notwithstanding the expiration of such period, continue to be exercisable to the extent to which it was exercisable at the time of death for a period of 12 months from the date of such death or until the Expiration Date of
such Option, whichever period is the shorter. 
  
 (d) Other
Termination. Unless otherwise determined by the Committee: (i) if an Optionee incurs a Termination of Employment for Cause, all Options held by such Optionee shall thereupon terminate; and (ii) if an Optionee incurs a Termination of Employment
for any reason, other than death, Disability, Retirement or for Cause, any Stock Option held by such Optionee, to the extent then exercisable, or on such accelerated basis as the Committee may determine, may be exercised for the lesser of 6 months
from the date of such Termination of Employment or until the Expiration Date of such Stock Option; provided, however, that if the Optionee dies within such period, any unexercised Stock Option held by such Optionee shall, notwithstanding the
expiration of such period, continue to be exercisable to the extent to which it was exercisable at the time of death for a period of 12 months from the date of such death or until the Expiration Date of such Stock Option, whichever period is the
shorter. 
  

 6 

 (e) Transferability of Stock Options. No Option shall be transferable by the Optionee other than
(i) by designation of a Beneficiary, by will or by the laws of descent and distribution, or (ii) as otherwise expressly permitted under the applicable Award Agreement including, if so permitted, pursuant to a gift to such Optionee’s family,
whether directly or indirectly or by means of a trust or partnership or otherwise. All Options shall be exercisable, subject to the terms of this Plan, only by the Optionee, by the guardian or legal representative of the Optionee if the Optionee is
incapacitated, by the Optionee’s Beneficiaries, legal representative or heirs after the Optionee’s death, or any person to whom such option is transferred pursuant to clause (ii) of the preceding sentence. 
  
 (f) Cashing Out of Stock Option. On receipt of written notice of
exercise, the Committee may elect to cash out all or part of the portion of the shares of Common Stock for which a Stock Option is being exercised by paying the Optionee an amount, in cash or Common Stock, equal to the excess of the Fair Market
Value of the Common Stock over the option price times the number of shares of Common Stock for which the Option is being exercised on the effective date of such cash-out. 
  
 ARTICLE 5 EXERCISE OF OPTIONS 
  
 5.1 Partial Exercise 
  
 An Option may be exercised in whole or in part at any time after it has become vested and exercisable and before its Expiration Date, subject to Article
4. However, an Option shall not be exercisable with respect to fractional shares and the Committee or the Company may impose a minimum number of shares for which a partial exercise will be permitted. 
  
 5.2 Manner of Exercise 
  
 All or a portion of an exercisable Option may be exercised upon delivery to
the Secretary or his office of all of the following: 
  
 (a) A
written notice complying with the applicable rules established by the Committee or the Company, stating that the Option, or a portion thereof, is being exercised, and signed by the Optionee or other person then entitled to exercise the Option or
such portion; 
  
 (b) Full payment for the shares and taxes
described in Article 11.7 with respect to which the Option, or portion thereof, is exercised in whole or in part by (i) cash; (ii) certified or bank check or such other instrument as the Company may accept; (iii) delivery (either by surrender of the
shares or by attestation) of shares unrestricted Common Stock already owned by the Optionee of the same class as the Common Stock subject to the Stock Option (based on the Fair Market Value of the Common Stock on the date the Stock Option is
exercised); provided, however, that such already-owned shares either were acquired by the Optionee in an open-market transaction or have been held by the Optionee for at least six months at the time of exercise; (iv) if permitted by the
Committee, the surrender of shares of Common Stock then issuable upon exercise of the Option; or (v) if permitted by the Committee, by delivering a properly executed exercise notice to the Company, together with a copy of irrevocable instructions to
a broker acceptable to the Company to deliver promptly to the Company the amount of sale or loan proceeds necessary to pay the option price, and, if requested, by the amount of any federal, state, local or foreign withholding taxes; and 

 
 (c) In the event that the Option shall be exercised by any person or
persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option. 
  
 ARTICLE 6 STOCK APPRECIATION RIGHTS 
  
 6.1 Grant and Exercise 
  
 (a) Stock Appreciation Rights may be granted in conjunction with all or part of any Option granted under the Plan, either at or after the time of grant of
such Option. A Stock Appreciation Right shall terminate and no longer be exercisable upon the termination or exercise of the related Option. 
  

 7 

 (b) A Stock Appreciation Right may be exercised by an Optionee in accordance with Article 6.2(b) by
surrendering the applicable portion of the related Option in accordance with procedures established by the Committee or the Company. Upon such exercise and surrender, the Optionee shall be entitled to receive an amount determined in the manner
prescribed in Article 6.2(b). Options that have been so surrendered shall no longer be exercisable to the extent the related Stock Appreciation Rights have been exercised. 
  
 6.2 Terms and Conditions 
  
 Stock Appreciation Rights shall be subject to such terms and conditions as shall be determined by the Committee, including
the following: 
  
 (a) Stock Appreciation Rights shall be
exercisable only at such time or times and to the extent that the Options to which they relate are exercisable in accordance with the provisions of the Plan. 
  
 (b) Upon the exercise of a Stock Appreciation Right, an Optionee shall be entitled to receive an amount in cash, shares of Common Stock or both, in value
equal to the excess of the Fair Market Value of one share of Common Stock over the option price per share specified in the related Option multiplied by the number of shares in respect of which the Stock Appreciation Right shall have been exercised,
with the Committee or the Company having the right to determine the form of payment. To the extent that a Stock Appreciation Right is exercised and settled in Common Stock, the number of shares available for future Awards under the Plan shall be
reduced by the number of Stock Appreciation Rights that are exercised (and not the number of shares actually issued upon settlement of the Award). 
  
 (c) Stock Appreciation Rights shall be transferable only to permitted transferees of the underlying Option in accordance with the provisions of the Plan.

  
 ARTICLE 7 RESTRICTED STOCK AND RESTRICTED STOCK UNITS 
  
 7.1 Administration 
  
 Shares of Restricted Stock and Awards of Restricted Stock Units may be
awarded either alone or in addition to other Awards granted under the Plan. The Committee shall determine the Employees to whom and the time or times at which grants of Restricted Stock and Restricted Stock Units will be awarded, the number of
shares to be awarded to any Awardee, the conditions for vesting, the time or times within which such Awards may be subject to forfeiture and any other terms and conditions of the Awards, in addition to those contained in Article 7.3. The total
number of shares of Restricted Stock and the total number of shares represented by Restricted Stock Units and Dividend Equivalents granted under the Plan shall not exceed 300,000. 
  
 7.2 Awards and Certificates 
  
 (a) Shares of Restricted Stock shall be evidenced in such manner, as the Committee or the Company may deem appropriate,
including book-entry registration or issuance of one or more stock certificates. Any certificate issued in respect of shares of Restricted Stock shall be registered in the name of such Awardee and shall bear an appropriate legend referring to the
terms, conditions, and restrictions applicable to such Award, substantially in the following form: 
  
 “The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of
the Avery Dennison Corporation Employee Stock Option and Incentive Plan and an Award Agreement. Copies of such Plan and Agreement are on file at the offices of Avery Dennison Corporation, 150 North Orange Grove Boulevard, Pasadena, CA 91103.”

  
 The Committee or the Company may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions thereon shall have lapsed and that, as a condition of any Award of Restricted Stock, the Awardee shall have delivered a stock power, endorsed in blank, relating to the Common Stock
covered by such Award. 
  
 (b) Restricted Stock Units shall
represent the right to receive, at a specified time or times, either a specified number of shares of Common Stock, or a cash payment equal to the Fair Market Value of a specified number of shares of Common Stock, as the Committee or the Company
shall determine. 
  

 8 

 7.3 Terms and Conditions 
  
 The terms and conditions of an Award of Restricted Stock or Restricted Stock
Units as established by the Committee shall be set forth in an Award Agreement, including the following: 
  
 (a) The Committee may, in connection with the grant, designate an Award of Restricted Stock or Restricted Stock Units as a Qualified Performance-Based
Award, in which event it shall condition the grant or vesting (generally, during a period of three years), as applicable, of such Award upon the attainment of Performance Goals. If the Committee does not designate an Award of Restricted Stock or
Restricted Stock Units as a Qualified Performance-Based Award, it may also condition the grant or vesting thereof upon the attainment of Performance Goals. Regardless of whether an Award of Restricted Stock or Restricted Stock Units is a Qualified
Performance-Based Award, the Committee may also condition the grant or vesting thereof upon the continued service of the Awardee. The conditions for grant or vesting and the other provisions of Awards of Restricted Stock or Restricted Stock Units
(including any applicable Performance Goals) need not be the same with respect to each Awardee. The Committee may at any time, in its sole discretion, accelerate or waive, in whole or in part, any of the foregoing restrictions; provided, however,
that in the case of an Award that is a Qualified Performance-Based Award, the applicable Performance Goals have been satisfied. The total number of shares represented by Qualified Performance Based Award granted under the Plan shall not exceed
300,000. 
  
 (b) Subject to the provisions of the Plan and the
applicable Award Agreement, during the period, if any, set by the Committee, commencing with the date of such Award for which such Awardee’s continued service is required (the “Restriction Period”), and until the later of (i) the
expiration of the Restriction Period and (ii) the date the applicable Performance Goals (if any) are satisfied, the Awardee shall not be permitted to sell, assign, transfer, pledge or otherwise encumber shares of Restricted Stock or an Award of
Restricted Stock Units; provided that the foregoing shall not prevent an Awardee from pledging Restricted Stock as security for a loan, the sole purpose of which is to provide funds to pay the option price for Stock Options. 
  
 (c) Except as provided in this paragraph (c) and Articles 7.3(a) and 7.3(b)
and the applicable Award Agreement, the Awardee shall have, with respect to shares of Restricted Stock (but not Restricted Stock Units), all of the rights of a stockholder of the Company holding the class or series of Common Stock that is the
subject of the Restricted Stock, including, if applicable, the right to vote the shares and the right to receive any cash dividends. Unless otherwise determined by the Committee and subject to the next sentence, (A) cash dividends on the class or
series of Common Stock that are the subject of the Award of Restricted Stock or Restricted Stock Units shall be automatically deferred and reinvested in additional Restricted Stock or Restricted Stock Units, as applicable, held subject to the
vesting of the underlying Award, and (B) dividends payable in Common Stock shall be paid in the form of additional Restricted Stock or Restricted Stock Units, as applicable, held subject to the vesting of the underlying Award. Notwithstanding the
foregoing or any provision of an Award Agreement, reinvestment of dividends in additional Restricted Stock or Restricted Stock Units shall only be permissible if sufficient shares of Common Stock are available under the Plan for such reinvestment
(taking into account then outstanding Awards). 
  
 (d) Except to
the extent otherwise provided in the applicable Award Agreement and Articles 7.3(a), 7.3(b), 7.3(e) and 10.1(b), upon an Awardee’s Termination of Employment for any reason during the Restriction Period or before the applicable Performance Goals
are satisfied, all shares of Restricted Stock and all Restricted Stock Units still subject to restriction shall be forfeited by the Awardee. 
  
 (e) Except to the extent otherwise provided in Article 9.1(b), in the event an of an Awardee’s Retirement or Termination of Employment other than for
Cause, the Committee shall have the discretion to waive, in whole or in part, any or all remaining restrictions (other than, in the case of Restricted Stock with respect to which an Awardee is a Covered Employee, satisfaction of the applicable
Performance Goals unless the Termination of Employment was by reason of the Awardee’s death, Disability or Involuntary Termination) with respect to any or all of such Awardee’s shares of Restricted Stock. 
  
 (f) If and when any applicable Performance Goals are satisfied and the
Restriction Period expires without a prior forfeiture of the Restricted Stock, unlegended certificates for such shares shall be delivered to the Awardee upon surrender of the legended certificates. 
  

 9 

 ARTICLE 8 DIVIDEND EQUIVALENTS 
  
 8.1 Dividend Equivalents 
  
 Dividend Equivalents may be granted under this Plan either alone or in conjunction with any other Award. Dividend
Equivalents shall represent the right to receive cash payments, shares of Common Stock, or a combination thereof, having a value equal to the dividends declared on Common Stock during a specified period, and subject to such other terms and
conditions as the Committee shall determine. 
  
 ARTICLE 9 CHANGE IN CONTROL
PROVISIONS 
  
 9.1 Impact of Event

  
 Notwithstanding any other provision of the Plan to the
contrary, in the event of a Change in Control: 
  
 (a) Any
Options and Stock Appreciation Rights outstanding as of the date such Change in Control is determined to have occurred, and which are not then exercisable and vested, shall become fully exercisable and vested, and shall remain exercisable until
their Expiration Date notwithstanding any Termination of Employment of the relevant Optionee other than a Termination of Employment for Cause. 
  
 (b) The restrictions and deferral limitations applicable to any Restricted Stock or Restricted Stock Units shall lapse, and such Restricted Stock or
Restricted Stock Units shall become free of all restrictions and become fully vested and transferable. 
  
 (c) Any restrictions or deferral or forfeiture limitations applicable to any Dividend Equivalents shall lapse. 
  
 9.2 Definition of Change in Control 
  
 For purposes of the Plan, a “Change in Control” shall mean the
happening of any of the following events: 
  
 (a) An acquisition
by any individual, entity or group (within the meaning of Article 13.4(a) or 14.4(b) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either
(i) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election
of directors (the “Outstanding Company Voting Securities”); excluding, however, the following: (A) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security
being so converted was itself acquired directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the
Company, or (D) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Article 9.2; or 
  
 (b) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute
the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, for purposes of this Article 9.2, that any individual who becomes a
member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who
were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but, provided further, that any such individual whose initial assumption of
office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or 
  
 (c) The consummation of a reorganization, merger or consolidation or sale involving the Company or a disposition of all or substantially all of the assets
of the Company (“Corporate Transaction”); excluding however, such a Corporate Transaction pursuant to which (i) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting 
  

 10 

 Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 60%
of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such
Corporate Transaction (including a corporation, which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company, any employee benefit plan
(or related trust) of the Company or such corporation resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of common stock of the corporation resulting from
such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate
Transaction, and (iii) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or 
  
 (d) The approval by the stockholders of the Company of a complete liquidation
or dissolution of the Company. 
  
 ARTICLE 10 ADMINISTRATION 
  
 10.1 Committee 
  
 The Plan shall be administered by the Compensation and Executive Personnel
Committee of the Board or such other committee of the Board, as may from time to be selected by the Board. 
  
 10.2 Powers of Committee 
  
 (a) The Committee shall have the authority to conduct the general administration of this Plan in accordance with its provisions. The Committee shall have
the power to make Awards and set the terms and conditions for such Awards (including the option price, any vesting condition, restriction or limitation (which may be related to the performance of the Awardee, the Company or any Subsidiary) and any
vesting acceleration or forfeiture waiver regarding any Award and the shares of Common Stock relating thereto, based on such factors as the Committee shall determine; to modify, amend or adjust the terms and conditions of any Award, at any time or
from time to time, including Performance Goals; provided, however, that the Committee may not adjust upwards the amount payable with respect to a Qualified Performance-Based Award or waive or alter the Performance Goals associated therewith
except as specifically permitted by the Plan; to determine to what extent and under what circumstances Common Stock and other amounts payable with respect to an Award shall be deferred; and to determine under what circumstances an Award may be
settled in cash or Common Stock under Articles 5, 6, 8 and 9, as applicable. The Committee shall have the power to interpret this Plan and the Awards made hereunder, to adopt such rules and procedures for the administration, interpretation, and
application of this Plan as are consistent therewith, and to interpret, amend or revoke any such rules and procedures. Any Award under this Plan need not be the same with respect to each Awardee. 
  
 (b) Any determination made by the Committee or pursuant to delegated
authority pursuant to the provisions of the Plan with respect to any Award shall be made in the sole discretion of the Committee or such delegate at the time of the grant of the Award or, unless in contravention of any express term of the Plan, at
any time thereafter. All decisions made by the Committee or any appropriately delegated officer pursuant to the provisions of the Plan shall be final and binding on all persons, including the Company, Awardees and Beneficiaries. 
  
 10.3 Action by Committee 
  
 (a) The Committee shall act by a majority of its members in office. The
Committee may act either by vote at a meeting, or by a memorandum, minutes or other written instrument signed by the Chairman of the Committee or by a majority of the Committee. The Committee may delegate to (i) the CEO the authority to make
decisions pursuant to, and interpretations of, the Plan (provided that no such delegation may be made that would cause Awards or other transactions under the Plan to cease to be exempt from Section 16(b) of the Exchange Act or cause Qualified
Performance-Based Awards to fail to qualify for the Section 162(m) exemption), including the authority to grant Awards to any Employee who is not an “officer” of the Company (within the meaning of Rule 
  

 11 

 16a-1(f) promulgated under the Exchange Act, as amended), subject to any limitations the Committee may impose, and (ii)
the CEO or Secretary, or both, or any or all of the administrative and interpretive duties and authority of the Committee under the Plan. 
  
 (b) Any authority granted to the Committee under this Plan may also be exercised by the full Board, except to the extent that the grant or exercise of
such authority would cause any Award designated as a Qualified Performance-Based Award not to qualify for, or to cease to qualify for, the Section 162(m) Exemption. To the extent that any permitted action taken by the Board conflicts with action
taken by the Committee, the Board action shall control. 
  
 10.4 Compensation; Professional Assistance; Good Faith Actions 
  
 Expenses and liabilities that members of the Committee incur in connection with the administration of this Plan shall be borne by the Company. The
Committee may employ attorneys, consultants, accountants, appraisers, brokers, or other persons. The Committee, the Company, and its officers and Directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All
actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon all Awardees and Beneficiaries, the Company, and all other interested persons. No members of the Committee shall be
personally liable for any action, determination, or interpretation made in good faith with respect to this Plan or any Award, and all members of the Committee shall be fully protected by the Company in respect of any such action, determination or
interpretation. 
  
 ARTICLE 11 MISCELLANEOUS PROVISIONS 
  
 11.1 Not Transferable 
  
 Except as specifically provided in the Plan with respect to Options and
Stock Appreciation Rights, as provided in Article 11.8 regarding designation of Beneficiaries, and as may be otherwise provided in the applicable Award Agreement: (i) Awards may not be sold, pledged, assigned, or transferred in any manner other than
by will or the laws of descent and distribution; (ii) no Award or interest or right therein shall be subject to the debts, contracts or engagements of the Awardee or his Beneficiaries and successors in interest or shall be subject to disposition by
transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy); and (iii) any attempted disposition of an Award shall be null and void and of no effect. 
  
 11.2 Unfunded Status of Plan 
  
 It is presently intended that the Plan constitutes an “unfunded” plan for incentive and deferred compensation. The Committee may authorize the
creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provided that, unless the Committee otherwise determines, the existence of such trusts or other arrangements is
consistent with the “unfunded” status of the Plan. 
  
 11.3 General Provisions 
  
 (a) The Committee or the Company may require each person purchasing or receiving shares of Common Stock pursuant to an Award, as a condition to delivery of such shares, to represent to and agree with the Company in writing that such person
is acquiring the shares without a view to the distribution thereof and to provide such other representations and such documents as the Committee or the Company deems necessary or appropriate to effect compliance with all applicable laws. Such shares
may be delivered by book entry or in certificate form, with such legends or other notations as the Committee or the Company deems appropriate to reflect any restrictions on transfer. 
  
 (b) Notwithstanding any other provision of the Plan or any Award Agreement, the Company shall not be required to issue or
deliver any shares of Common Stock under the Plan prior to fulfillment of all of the following conditions: 
  
 (i) Listing or approval for listing upon notice of issuance of such shares on the New York Stock Exchange, Inc., or such other securities
exchange as may at the time be the principal market for the Common Stock; 
  

 12 

 (ii) Any registration or other qualification of such shares of the Company under any
state or federal law or regulation, or the maintaining in effect of any such registration or other qualification that the Committee or the Company deems necessary or advisable; 
  
 (iii) Obtaining any other consent, approval, or permit from any state or federal governmental agency that
the Committee or the Company determines to be necessary or advisable; 
  
 (iv) The lapse of such reasonable period of time following the exercise of an Option or Stock Appreciation Right or the vesting or other event that results in the settlement of an Award, as the Committee or the
Company may establish from time to time for reasons of administrative convenience; and 
  
 (v) The receipt by the Company of full payment (if any) for such shares and the satisfaction of any tax withholding obligations relating
thereto. 
  
 An Awardee shall not be, nor have any of the rights or privileges of,
a stockholder of the Company in respect of any shares of Common Stock that may become deliverable pursuant to an Award unless and until such shares have been delivered to the Awardee. 
  
 (c) In the event an Award is granted to an Employee who is employed outside the United States and who is not compensated
from a payroll maintained in the United States, the Committee or the Company may modify the provisions of the Plan as they pertain to such Award or Awardee to comply with applicable foreign law, and/or related regulations or requirements.

  
 (d) The Committee may (but need not) establish rules under
which Awardees may be permitted to elect to defer receipt of cash or shares in settlement of Restricted Stock Units for a specified period or until a specified event, either under an existing plan of the Company or otherwise. 
  
 11.4 Amendment, Suspension, or Termination of this Plan

  
 The Board may amend, suspend or terminate the Plan at any
time prior to a Change of Control, but no such amendment, suspension or termination shall impair the rights of Awardees under Awards previously granted without the Awardee’s consent, and provided further that no material amendments will be made
to the terms of the Plan without the approval of the Company’s stockholders. 
  
 The Committee may amend the terms of any Award after it is granted, prospectively or retroactively, but no such amendment shall reprice an option, cause a Qualified Performance-Based Award to cease to qualify for the
Section 162(m) Exemption or impair the rights of the Awardee without the Awardee’s consent. 
  
 11.5 Adjustments upon Changes in Common Stock 
  
 In the event of a stock dividend, stock split, reverse stock split, share combination, recapitalization, merger,
consolidation, acquisition of property or shares, separation, spin-off, reorganization, stock rights offering, liquidation, Disaffiliation of a Subsidiary or similar event, the Committee shall make such adjustments (if any) as it deems appropriate
and equitable, in its discretion, to the following: 
  

	 	(a)	the aggregate number of shares of Common Stock available under Article 2.1 and Article 7.1, and the limits on grants of Options under Article 3.2 and grants of Qualifying
Performance-Based Awards under Articles 7 and 8; 

  

	 	(b)	the number of shares of Common Stock covered by outstanding Awards; 

  

	 	(c)	the option price of outstanding Options, and 

  

	 	(d)	such other adjustments to outstanding Awards as the Committee may determine to be appropriate and equitable. 

  
 Such adjustments may include, without limitation, (i) the cancellation of outstanding Awards
in exchange for payments of cash, property or a combination thereof having an aggregate value equal to the value of such Awards, as determined by the Committee in its sole discretion, (ii) the substitution of other property (including, without

  

 13 

 limitation, other securities) for the Stock covered by outstanding Awards, and (iii) in connection with any
Disaffiliation of a Subsidiary, arranging for the assumption, or replacement with new awards, of Awards held by Awardees employed by the affected Subsidiary by the Subsidiary or an entity that controls the Subsidiary following the Disaffiliation.

  
 11.6 Approval of Plan by Stockholders

  
 This Plan, as amended and restated, was approved by the
Board on February 24, 2005, and will be submitted for the approval by the Company’s stockholders at the annual meeting of stockholders on April 28, 2005. 
  

11.7 Tax Withholding 
  
 No later than the date as of which an amount first becomes includible in the gross income of an Awardee for federal income tax purposes with respect to
any Award under the Plan, such an Awardee shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such
amount. Unless otherwise determined by the Company, withholding obligations may be settled with Common Stock, including Common Stock that is part of the Award that gives rise to the withholding requirement; provided, however, that not more than the
legally required minimum withholding may be settled with Common Stock. The obligations of the Company under the Plan shall be conditional on such payment or arrangements, and the Company and its Subsidiaries shall, to the extent permitted by law,
have the right to deduct any such taxes from any payment otherwise due to such an Awardee. The Committee may establish such procedures as it deems appropriate, including making irrevocable elections, for the settlement of withholding obligations
with Common Stock. 
  
 11.8 Beneficiaries

  
 The Committee or the Company shall establish such
procedures as it deems appropriate for Awardees to designate one or more persons (each, a “Beneficiary”) to whom any amounts payable under this Plan in the event of the applicable Awardee’s death are to be paid and/or by whom any
rights of the applicable Awardee’s, after the Awardee’s death, may be exercised. Designation, revocation and redesignation of Beneficiaries must be made in writing in accordance with procedures established by the Committee or the Company,
and shall be effective upon delivery to the Committee or the Company. 
  
 11.10 Effect of Plan 
  
 The adoption of this Plan shall not affect any other compensation or incentive plans in effect for the Company or any Subsidiary. Nothing in this Plan shall be construed to limit the right of the Company (a) to establish any other forms of
incentives or compensation for employees of the Company or any Subsidiary, or (b) to grant or assume options or other rights otherwise than under this Plan in connection with any proper corporate purpose, including the grant or assumption of options
in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, firm or association. Nothing in this Plan or in any Award Agreement shall confer upon any Awardee any
right to continue in the employ of the Company or any Subsidiary or interfere with or restrict in any way the rights of the Company and the Subsidiaries, which are hereby expressly reserved, to discharge any Awardee at any time for any reason
whatsoever, with or without Cause. 
  
 11.11
Titles 
  
 Titles are provided herein for convenience only
and are not to serve as a basis for interpretation or construction of this Plan. 
  
 11.12 Governing Law 
  
 This Plan and any Award Agreements hereunder shall be administered, interpreted and enforced under the laws of the State of Delaware, without reference to
the principle of conflict of laws. 
  
 11.13
Effective Date 
  
 This Plan, as amended and restated, shall
be effective as of April 28, 2005, subject to the approval of stockholders of the Company as contemplated by Article 11.6. This Plan was previously approved by stockholders on April 24, 2003. 
  

 14Forms of NQSO Agreement under Stock Option Plan

 Exhibit 10.19.7 
  
 AVERY DENNISON CORPORATION 
 NON-QUALIFIED STOCK OPTION AGREEMENT 
  
 THIS AGREEMENT, dated December 2, 2004, is made by and between Avery Dennison Corporation, a Delaware corporation, hereinafter referred to as the “Company,” and *, an employee of Company or a Subsidiary of Company, hereinafter
referred to as “Employee.” 
  
 WHEREAS, Company wishes to afford
Employee the opportunity to purchase shares of its $1.00 par value common stock under the terms of the Employee Stock Option and Incentive Plan; and 
  
 WHEREAS, the Compensation and Executive Personnel Committee of the Company’s Board of Directors (hereinafter referred to as the “Committee”), appointed to
administer said Plan, has determined that it would be to the advantage and best interest of Company and its shareholders to grant the Option provided for herein to Employee as an inducement to remain in the service of Company or its Subsidiaries and
as an incentive for increased efforts during such service; 
  
 WHEREAS, the
Committee has advised the Company of its determination and instructed the undersigned officers to issue said Option, which the Committee has determined should be a Non-Qualified Stock Option, as authorized under the Plan; 
  
 NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and
valuable consideration, the receipt of which is hereby acknowledged, Company and Employee do hereby agree as follows: 
  
 ARTICLE I - DEFINITIONS 
  
 Whenever the following terms are used in this Agreement they shall have the meaning specified below unless the context clearly indicates to the contrary. 
  

	1.1	Beneficiary 

  
 “Beneficiary” shall mean a person properly designated by the Employee, including his/her spouse or heirs at law, to exercise such
Employee’s rights under the Plan. Designation, revocation and redesignation of Beneficiaries must be made in writing in accordance with procedures established by the Committee or the Company, and shall be effective upon delivery to the Company.

  

	1.2	Change of Control 

  
 “Change of Control” shall have the same meaning given in Article 10.2 of the Plan. 
  

	1.3	Option 

  
 “Option” shall mean the option to purchase common stock of the Company granted under this Agreement. 
  

	1.4	Plan 

  
 The “Plan” shall mean the Employee Stock Option and Incentive Plan, as amended and restated. 
  

	1.5	Pronouns 

  
 The masculine pronoun shall include the feminine and neuter, and the singular and plural, where the context so indicates. 
  

	*	Refer to attached Notice 

  

 1 

	1.6	Secretary 

  
 “Secretary” shall mean the Secretary of the Company. 
  

	1.7	Subsidiary 

  
 “Subsidiary” shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain then owns stock possessing 33 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
  

	1.8	Termination of Employment 

  
 “Termination of Employment” shall mean the time when the employee-employer relationship between the Employee and the Company or a Subsidiary is
terminated for any reason, including, but not limited to, a termination by resignation, discharge, death or retirement, but excluding terminations where there is a simultaneous reemployment or continuing employment by the Company or a Subsidiary,
and, at the discretion of the Committee or the Company, terminations which result in the severance of the employee-employer relationship that do not exceed one year. The Committee or the Company shall determine the effect of all other matters and
questions relating to Termination of Employment. 
  
 ARTICLE II - GRANT OF OPTION 
  

	2.1	Grant of Option 

  
 In consideration of Employee’s agreement to remain in the employ of Company or its subsidiaries and for other good and valuable consideration, on the
date hereof the Company irrevocably grants to Employee the option to purchase any part or all of an aggregate of * shares of its $1.00 par value common stock upon the terms and conditions set forth in this Agreement. Such Option is granted pursuant
to the Plan and shall also be subject to the terms and conditions set forth in the Plan. 
  

	2.2	Purchase Price 

  
 The purchase price of the shares of stock covered by the Option shall be fifty nine and 18500/10000 dollars ($59.185) per share without commission or
other charge. 
  

	2.3	Consideration to Company 

  
 In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient service to the Company or a
Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted (unless the Employee retires before the end of such period and the
Employee satisfies the requirements of the last paragraph of Subsection 3.1(a)). Nothing in this Agreement or in the Plan shall confer upon the Employee any right to continue in the employ of the Company or any Subsidiary or shall interfere with or
restrict in any way the rights of the Company and its Subsidiaries, which are hereby expressly reserved, to discharge the Employee at any time for any reason whatsoever, with or without good cause. Nor shall it interfere with or restrict in any way,
other than the forfeiture of all rights under this Agreement, the right of the Employee voluntarily to terminate his employment with the Company or a Subsidiary. 
  

	2.4	Adjustments in Option 

  
 In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the
Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend, or combination of shares, the Committee or the Company shall make an appropriate and equitable
adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable. Such adjustment shall be made with 
  

	*	Refer to attached Notice 

  

 2 

 the intent that after the change or exchange of shares, the Employee’s proportionate interest shall
be maintained as before the occurrence of such event. Such adjustment in the Option may include a necessary corresponding adjustment in the option price per share, but shall be made without change in the total price applicable to the unexercised
portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices). 
  
 ARTICLE III - PERIOD OF EXERCISABILITY 
  

	3.1	Commencement of Exercisability 

  

	 	(a)	The Option will vest (become available for exercise) nine years and nine months from the date the Option was granted. However, if certain conditions are met, the Option will become
eligible for accelerated or early vesting three years from the date the Option was granted or on subsequent anniversary dates thereafter. 

  
 Such early or accelerated vesting will occur provided that the Company’s return on total capital as reported in the annual report to shareholders (or
other report) for the most recently completed fiscal year equals or exceeds the sixty-seventh (67%) percentile of the return on total capital for the peer group companies (as listed in the Company’s proxy statement) for such third year (the
performance test). (For example, the performance test for accelerated vesting for options granted in December 2003 will be based on the return on total capital for 2006). 
  
 To facilitate the peer group performance comparison needed to determine whether option vesting is accelerated, the figures
for peer group companies return on total capital will be based upon the twelve-month performance for each company in the peer group closest to the Company’s fiscal year end, using the most recent publicly available financial information for
such companies. 
  
 If the Company meets the performance test
described above, all prior non-vested Options eligible for accelerated vesting will become available for exercise as soon as possible following the Committee’s certifications of the Company’s performance as compared to the performance of
the peer group companies. 
  
 If the Company fails to meet the
performance test described above, all prior non-vested Options eligible for accelerated vesting will be subject to a similar performance test following the end of the next fiscal year. The test for accelerated vesting of Options will continue to
“roll” forward in the manner described above until the Company passes the performance test, until nine years and nine months have elapsed from the date of grant, or until such Options otherwise vest as described herein. 
  
 Alternatively, Options, granted to employees as participants in the Long
Term Incentive Plan, who (i) retire under the Company’s retirement plan within sixty (60) days of the date of Termination of Employment, (ii) have worked for the Company for ten (10) or more years, and (iii) have a combination of age and
service with the Company of seventy five (75) or more, will vest as of the date of Termination of Employment, provided that the Company has met the performance test (as described above) for the fiscal year ending prior to the employee’s
retirement. 
  

	 	(b)	No portion of the Option which is unexercisable under Subsection (a) above at Termination of Employment shall thereafter become exercisable, unless otherwise determined by the
Committee. 

  

	 	(c)	Notwithstanding Subsections 3.1(a) and 3.1(b) above, upon a Change of Control, all Option installments not yet exercisable shall become immediately exercisable.

  

	3.2	Term of Option 

  
 The Option will expire and will not, under any condition, be exercisable after the tenth (10th) anniversary of the date the Option was granted. Such date
shall be the Option’s Expiration Date. 
  

 3 

	3.3	Exercise of Option after Termination of Employment 

  
 This Option is exercisable by the Employee only while he is employed by the Company or a Subsidiary, subject to the following exceptions: 
  

	 	(a)	If the Employee dies while the Option is exercisable under the terms of this Agreement, the Employee’s Beneficiary may exercise such rights, subject to the limitation in
Subsection 3.1(b). The Option must be exercised within twelve (12) months after the Employee’s death, and the Committee or the Company may in its discretion extend the Expiration Date of the Option to accommodate such exercise.

  

	 	(b)	If the Employee’s employment is terminated due to his permanent and total disability, as defined in Section 22(c)(3) of the Code, the Employee may exercise the Option, subject
to the limitation in Subsection 3.1(b), within thirty six (36) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(c)	If the Employee’s employment is terminated due to his retirement, the Employee may exercise the Option, subject to the limitations of Subsection 3.1(b), within sixty (60)
months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(d)	If the Employee’s employment is terminated other than for good cause or the reasons set forth in Subsections (a) through (c) above, the Employee may exercise the Option,
subject to the limitations of Subsection 3.1(b), within six (6) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  
 ARTICLE IV - EXERCISE OF OPTIONS 
  

	4.1	Partial Exercise 

  
 Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time
when the Option or portion thereof becomes unexercisable under Section 3.2. Each partial exercise shall be for not less than twenty-five (25) shares (or a smaller number, if it is the maximum number which may be exercised under Section 3.1), and
shall be for whole shares only. 
  

	4.2	Manner of Exercise 

  
 The Option, or any exercisable portion thereof, may be exercised by delivery (hard copy, fax or e-mail, as appropriate) to the Secretary or to the
Company’s Securities Administrator of all of the following: 
  

	 	(a)	A written notice, complying with the applicable procedures established by the Committee or the Company, stating that the Option or portion is thereby exercised; the notice shall be
signed by the Employee or the other person then entitled to exercise the Option, or alternatively, if the option exercise is executed through the Company’s designated broker (including execution of stock option exercise electronically through
the Web site of the Company’s designated broker), then such notice shall not be required; and 

  

	 	(b)	Full payment for the shares with respect to which the option or portion thereof is exercised. Payment may be made (i) in cash (or by certified or bank cashier’s check), or (ii)
by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the option is exercised equal to the aggregate
exercise purchase price of the shares with respect to which the option or portion thereof is exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or (iv) irrevocable instructions to a broker, acceptable
to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the option price; or (v) by instructing the Company to withhold a number of such shares having a Fair Market Value on the date of the
exercise equal to the aggregate exercise price of such Option; and 

  

	 	(c)	Full payment to the Company of any federal, state, local or foreign taxes required to be withheld in connection with the exercise. Payment may be made (i) in cash (or by certified
or bank cashier’s check), or (ii) by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the
option is exercised equal to the tax liability with respect to which the option or portion thereof is 

  

 4 

 exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or
(iv) irrevocable instructions to a broker, acceptable to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the tax liability; or (v) by instructing the Company to withhold a number of such
shares having a Fair Market Value on the date of the exercise equal to the tax liability (and provided that in any event Employee is responsible for the payment of any and all applicable taxes related to this stock option grant and any exercise of
stock options hereunder); and 
  

	 	(d)	In the event the Option or portion thereof shall be exercised by any person or persons other than the Employee, appropriate proof of the right of such person or persons to exercise
the Option. 

  

	4.3	Conditions to Issuance of Stock Certificates 

  
 The shares of stock deliverable upon the exercise of the Option, or any part thereof, may be either previously authorized but unissued shares or issued
shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the
Option or part thereof prior to fulfillment of all of the following conditions: 
  

	 	(a)	The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; 

  

	 	(b)	The completion of any registration or other qualification of such shares under any state or federal law, or under rulings or regulations of the Securities and Exchange Commission or
any other governmental regulatory body which the Committee or the Company shall, in its absolute discretion, deem necessary or advisable; 

  

	 	(c)	The obtaining of any approval or other clearance from any state or federal governmental agency which the Committee or the Company shall, in its absolute discretion, determine to be
necessary or advisable; 

  

	 	(d)	The lapse of such reasonable period of time following the exercise of the Option as the Committee or the Company may from time to time establish for reasons of administrative
convenience; and 

  

	 	(e)	The receipt by the Company of full payment for such shares. 

  

	4.4	Rights as Shareholders 

  
 The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon
the exercise of any part of the Option unless and until certificates or book entries representing such shares shall have been issued or made by the Company, or the Company’s transfer agent, to or for such holder. 
  
 ARTICLE V – MISCELLANEOUS 
  

	5.1	Option Subject to Plan 

  
 The Option is subject to the terms of the Plan, and in the event of any conflict between this Agreement and the Plan, the Plan shall control. 

 

	5.2	Administration 

  
 The Committee or the Company shall have the power to interpret the Plan and this Agreement and to adopt such procedures for the administration,
interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such procedures. 
  

	5.3	Option Not Transferable 

  
 Neither the Option nor any interest or right therein or part thereof may be sold, pledged, assigned or transferred in any manner other than by will or by
the applicable laws of descent and distribution. The Option shall be exercised during the Employee’s lifetime only by the Employee, or his guardian or legal representative. 
  

 5 

	5.4	Notices 

  
 Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary and any notice to be
given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section, either party may hereafter designate a different address for notices to be given to him. Any notice that
is required to be given to Employee shall, if Employee is then deceased, be given to Employee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section.

  

	5.5	Titles 

  
 Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 
  

	5.6	Construction 

  
 This Agreement and the Plan and all actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Delaware,
without reference to principles of conflict of laws. 
  
 IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the parties hereto. 
  

									
	 	 	 	 	 	 	 AVERY DENNISON CORPORATION

					
	By:	 	 *

	 	 	 	By:	 	 *

	Optionee	 	 	 	 	 	Chairman and Chief Executive Officer
					
	Address*:	 	
	 	 	 	By:	 	 *

	  

	 	 	 	 	 	Secretary
	  

	 	 	 	 	 	 

	*	Refer to attached Notice. 

  

 6 

 AVERY DENNISON CORPORATION 
 NON-QUALIFIED STOCK OPTION AGREEMENT 
  
 THIS AGREEMENT, dated December 2, 2004, is made by and between Avery Dennison Corporation, a Delaware corporation, hereinafter referred to as the “Company,” and *, an employee of Company or a Subsidiary of
Company, hereinafter referred to as “Employee.” 
  
 WHEREAS, Company
wishes to afford Employee the opportunity to purchase shares of its $1.00 par value common stock under the terms of the Employee Stock Option and Incentive Plan; and 
  
 WHEREAS, the Compensation and Executive Personnel Committee of the Company’s Board of Directors (hereinafter referred to as the
“Committee”), appointed to administer said Plan, has determined that it would be to the advantage and best interest of Company and its shareholders to grant the Option provided for herein to Employee as an inducement to remain in the
service of Company or its Subsidiaries and as an incentive for increased efforts during such service; 
  
 WHEREAS, the Committee has advised the Company of its determination and instructed the undersigned officers to issue said Option, which the Committee has determined should be a Non-Qualified Stock Option, as
authorized under the Plan; 
  
 NOW, THEREFORE, in consideration of the mutual
covenants herein contained and other good and valuable consideration, the receipt of which is hereby acknowledged, Company and Employee do hereby agree as follows: 
  
 ARTICLE I - DEFINITIONS 
  
 Whenever the following terms are used in this Agreement they shall have the meaning specified below unless the context clearly indicates to
the contrary. 
  

	1.1	Beneficiary 

  
 “Beneficiary” shall mean a person properly designated by the Employee, including his/her spouse or heirs at law, to exercise such
Employee’s rights under the Plan. Designation, revocation and redesignation of Beneficiaries must be made in writing in accordance with procedures established by the Committee or the Company, and shall be effective upon delivery to the Company.

  

	1.2	Change of Control 

  
 “Change of Control” shall have the same meaning given in Article 10.2 of the Plan. 
  

	1.3	Option 

  
 “Option” shall mean the option to purchase common stock of the Company granted under this Agreement. 
  

	1.4	Plan 

  
 The “Plan” shall mean the Employee Stock Option and Incentive Plan, as amended and restated. 
  

	1.5	Pronouns 

  
 The masculine pronoun shall include the feminine and neuter, and the singular and plural, where the context so indicates. 
  

	1.6	Secretary 

  
 “Secretary” shall mean the Secretary of the Company. 
  

	*	Refer to attached Notice. 

  

 7 

	1.7	Subsidiary 

  
 “Subsidiary” shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain then owns stock possessing 33 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
  

	1.8	Termination of Employment 

  
 “Termination of Employment” shall mean the time when the employee-employer relationship between the Employee and the Company or a Subsidiary is
terminated for any reason, including, but not limited to, a termination by resignation, discharge, death or retirement, but excluding terminations where there is a simultaneous reemployment or continuing employment by the Company or a Subsidiary,
and, at the discretion of the Committee or the Company, terminations which result in the severance of the employee-employer relationship that do not exceed one year. The Committee or the Company shall determine the effect of all other matters and
questions relating to Termination of Employment. 
  
 ARTICLE II - GRANT OF OPTION 
  

	2.1	Grant of Option 

  
 In consideration of Employee’s agreement to remain in the employ of Company or its subsidiaries and for other good and valuable consideration, on the
date hereof the Company irrevocably grants to Employee the option to purchase any part or all of an aggregate of * shares of its $1.00 par value common stock upon the terms and conditions set forth in this Agreement. Such Option is granted pursuant
to the Plan and shall also be subject to the terms and conditions set forth in the Plan. 
  

	2.2	Purchase Price 

  
 The purchase price of the shares of stock covered by the Option shall be fifty nine and 18500/10000 dollars ($59.185) per share without commission or
other charge. 
  

	2.3	Consideration to Company 

  
 In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient service to the Company or a
Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted (unless the Employee retires before the end of such period and the
Employee satisfies the requirements of the last paragraph of Subsection 3.1(a)). Nothing in this Agreement or in the Plan shall confer upon the Employee any right to continue in the employ of the Company or any Subsidiary or shall interfere with or
restrict in any way the rights of the Company and its Subsidiaries, which are hereby expressly reserved, to discharge the Employee at any time for any reason whatsoever, with or without good cause. Nor shall it interfere with or restrict in any way,
other than the forfeiture of all rights under this Agreement, the right of the Employee voluntarily to terminate his employment with the Company or a Subsidiary. 
  

	2.4	Adjustments in Option 

  
 In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the
Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend, or combination of shares, the Committee or the Company shall make an appropriate and equitable
adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable. Such adjustment shall be made with the intent that after the change or exchange of shares, the Employee’s
proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option may include a necessary corresponding adjustment in the option price per share, but shall be made without change in the total price
applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices). 
  

	*	Refer to attached Notice. 

  

 8 

 ARTICLE III - PERIOD OF EXERCISABILITY 
  

	3.1	Commencement of Exercisability 

  

	 	(a)	The Option will vest (become available for exercise) nine years and nine months from the date the Option was granted. However, if certain conditions are met, the Option will become
eligible for accelerated or early vesting three years from the date the Option was granted or on subsequent anniversary dates thereafter. 

  
 Such early or accelerated vesting will occur provided that the Company’s return on total capital as reported in the annual report to shareholders (or
other report) for the most recently completed fiscal year equals or exceeds the sixty-seventh (67%) percentile of the return on total capital for the peer group companies (as listed in the Company’s proxy statement) for such third year (the
performance test). (For example, the performance test for accelerated vesting for options granted in December 2003 will be based on the return on total capital for 2006). 
  
 To facilitate the peer group performance comparison needed to determine whether option vesting is accelerated, the figures
for peer group companies return on total capital will be based upon the twelve-month performance for each company in the peer group closest to the Company’s fiscal year end, using the most recent publicly available financial information for
such companies. 
  
 If the Company meets the performance test
described above, all prior non-vested Options eligible for accelerated vesting will become available for exercise as soon as possible following the Committee’s certifications of the Company’s performance as compared to the performance of
the peer group companies. 
  
 If the Company fails to meet the
performance test described above, all prior non-vested Options eligible for accelerated vesting will be subject to a similar performance test following the end of the next fiscal year. The test for accelerated vesting of Options will continue to
“roll” forward in the manner described above until the Company passes the performance test, until nine years and nine months have elapsed from the date of grant, or until such Options otherwise vest as described herein. 
  
 Alternatively, Options, granted to employees as participants in the Long
Term Incentive Plan, who (i) retire under the Company’s retirement plan within sixty (60) days of the date of Termination of Employment, (ii) have worked for the Company for ten (10) or more years, and (iii) have a combination of age and
service with the Company of seventy five (75) or more, will vest as of the date of Termination of Employment, provided that the Company has met the performance test (as described above) for the fiscal year ending prior to the employee’s
retirement. 
  

	 	(b)	No portion of the Option which is unexercisable under Subsection (a) above at Termination of Employment shall thereafter become exercisable, unless otherwise determined by the
Committee. 

  

	 	(c)	Notwithstanding Subsections 3.1(a) and 3.1(b) above, upon a Change of Control, all Option installments not yet exercisable shall become immediately exercisable.

  

	3.2	Term of Option 

  
 The Option will expire and will not, under any condition, be exercisable after the tenth (10th) anniversary of the date the Option was granted. Such date
shall be the Option’s Expiration Date. 
  

	3.3	Exercise of Option after Termination of Employment 

  
 This Option is exercisable by the Employee only while he is employed by the Company or a Subsidiary, subject to the following exceptions: 
  

	 	(a)	If the Employee dies while the Option is exercisable under the terms of this Agreement, the Employee’s Beneficiary may exercise such rights, subject to the limitation in
Subsection 3.1(b). The Option must be exercised within twelve (12) months after the Employee’s death, and the Committee or the Company may in its discretion extend the Expiration Date of the Option to accommodate such exercise.

  

 9 

	 	(b)	If the Employee’s employment is terminated due to his permanent and total disability, as defined in Section 22(c)(3) of the Code, the Employee may exercise the Option, subject
to the limitation in Subsection 3.1(b), within thirty six (36) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(c)	If the Employee’s employment is terminated due to his retirement, the Employee may exercise the Option, subject to the limitations of Subsection 3.1(b), to the full term of the
option, but not later than the Option’s Expiration Date. 

  

	 	(d)	If the Employee’s employment is terminated other than for good cause or the reasons set forth in Subsections (a) through (c) above, the Employee may exercise the Option,
subject to the limitations of Subsection 3.1(b), within six (6) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  
 ARTICLE IV - EXERCISE OF OPTIONS 
  

	4.1	Partial Exercise 

  
 Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time
when the Option or portion thereof becomes unexercisable under Section 3.2. Each partial exercise shall be for not less than twenty-five (25) shares (or a smaller number, if it is the maximum number which may be exercised under Section 3.1), and
shall be for whole shares only. 
  

	4.2	Manner of Exercise 

  
 The Option, or any exercisable portion thereof, may be exercised by delivery (hard copy, fax or e-mail, as appropriate) to the Secretary or to the
Company’s Securities Administrator of all of the following: 
  

	 	(a)	A written notice, complying with the applicable procedures established by the Committee or the Company, stating that the Option or portion is thereby exercised; the notice shall be
signed by the Employee or the other person then entitled to exercise the Option, or alternatively, if the option exercise is executed through the Company’s designated broker (including execution of stock option exercise electronically through
the Web site of the Company’s designated broker), then such notice shall not be required; and 

  

	 	(b)	Full payment for the shares with respect to which the option or portion thereof is exercised. Payment may be made (i) in cash (or by certified or bank cashier’s check), or (ii)
by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the option is exercised equal to the aggregate
exercise purchase price of the shares with respect to which the option or portion thereof is exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or (iv) irrevocable instructions to a broker, acceptable
to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the option price; or (v) by instructing the Company to withhold a number of such shares having a Fair Market Value on the date of the
exercise equal to the aggregate exercise price of such Option; and 

  

	 	(c)	Full payment to the Company of any federal, state, local or foreign taxes required to be withheld in connection with the exercise. Payment may be made (i) in cash (or by certified
or bank cashier’s check), or (ii) by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the
option is exercised equal to the tax liability with respect to which the option or portion thereof is exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or (iv) irrevocable instructions to a broker,
acceptable to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the tax liability; or (v) by instructing the Company to withhold a number of such shares having a Fair Market Value on the
date of the exercise equal to the tax liability (and provided that in any event Employee is responsible for the payment of any and all applicable taxes related to this stock option grant and any exercise of stock options hereunder); and

  

 10 

	 	(d)	In the event the Option or portion thereof shall be exercised by any person or persons other than the Employee, appropriate proof of the right of such person or persons to exercise
the Option. 

  

	4.3	Conditions to Issuance of Stock Certificates 

  
 The shares of stock deliverable upon the exercise of the Option, or any part thereof, may be either previously authorized but unissued shares or issued
shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the
Option or part thereof prior to fulfillment of all of the following conditions: 
  

	 	(a)	The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; 

  

	 	(b)	The completion of any registration or other qualification of such shares under any state or federal law, or under rulings or regulations of the Securities and Exchange Commission or
any other governmental regulatory body which the Committee or the Company shall, in its absolute discretion, deem necessary or advisable; 

  

	 	(c)	The obtaining of any approval or other clearance from any state or federal governmental agency which the Committee or the Company shall, in its absolute discretion, determine to be
necessary or advisable; 

  

	 	(d)	The lapse of such reasonable period of time following the exercise of the Option as the Committee or the Company may from time to time establish for reasons of administrative
convenience; and 

  

	 	(e)	The receipt by the Company of full payment for such shares. 

  

	4.4	Rights as Shareholders 

  
 The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon
the exercise of any part of the Option unless and until certificates or book entries representing such shares shall have been issued or made by the Company, or the Company’s transfer agent, to or for such holder. 
  
 ARTICLE V - MISCELLANEOUS 
  

	5.1	Option Subject to Plan 

  
 The Option is subject to the terms of the Plan, and in the event of any conflict between this Agreement and the Plan, the Plan shall control. 

 

	5.2	Administration 

  
 The Committee or the Company shall have the power to interpret the Plan and this Agreement and to adopt such procedures for the administration,
interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such procedures. 
  

	5.3	Option Not Transferable 

  
 Neither the Option nor any interest or right therein or part thereof may be sold, pledged, assigned or transferred in any manner other than by will or by
the applicable laws of descent and distribution. The Option shall be exercised during the Employee’s lifetime only by the Employee, or his guardian or legal representative. 
  

 11 

	5.4	Notices 

  
 Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary and any notice to be
given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section, either party may hereafter designate a different address for notices to be given to him. Any notice that
is required to be given to Employee shall, if Employee is then deceased, be given to Employee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section.

  

	5.5	Titles 

  
 Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 
  

	5.6	Construction 

  
 This Agreement and the Plan and all actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Delaware,
without reference to principles of conflict of laws. 
  
 IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the parties hereto. 
  

									
	 	 	 	 	 	 	AVERY DENNISON CORPORATION
					
	By:	 	 *

	 	 	 	By:	 	 *

	Optionee	 	 	 	 	 	Chairman and Chief Executive Officer
					
	Address*:	 	  

	 	 	 	By:	 	 *

	  

	 	 	 	 	 	Secretary
	  

	 	 	 	 	 	 

	*	Refer to attached Notice. 

  

 12 

 AVERY DENNISON CORPORATION 
 NON-QUALIFIED STOCK OPTION AGREEMENT 
  
 THIS AGREEMENT, dated December 2, 2004, is made by and between Avery Dennison Corporation, a Delaware corporation, hereinafter referred to as the “Company,” and *, an employee of Company or a Subsidiary of
Company, hereinafter referred to as “Employee.” 
  
 WHEREAS, Company
wishes to afford Employee the opportunity to purchase shares of its $1.00 par value common stock under the terms of the Employee Stock Option and Incentive Plan; and 
  
 WHEREAS, the Compensation and Executive Personnel Committee of the Company’s Board of Directors (hereinafter referred to as the
“Committee”), appointed to administer said Plan, has determined that it would be to the advantage and best interest of Company and its shareholders to grant the Option provided for herein to Employee as an inducement to remain in the
service of Company or its Subsidiaries and as an incentive for increased efforts during such service; 
  
 WHEREAS, the Committee has advised the Company of its determination and instructed the undersigned officers to issue said Option, which the Committee has determined should be a Non-Qualified Stock Option, as
authorized under the Plan; 
  
 NOW, THEREFORE, in consideration of the mutual
covenants herein contained and other good and valuable consideration, the receipt of which is hereby acknowledged, Company and Employee do hereby agree as follows: 
  
 ARTICLE I - DEFINITIONS 
  
 Whenever the following terms are used in this Agreement they shall have the meaning specified below unless the context clearly indicates to
the contrary. 
  

	1.1	Beneficiary 

  
 “Beneficiary” shall mean a person properly designated by the Employee, including his/her spouse or heirs at law, to exercise such
Employee’s rights under the Plan. Designation, revocation and redesignation of Beneficiaries must be made in writing in accordance with procedures established by the Committee or the Company, and shall be effective upon delivery to the Company.

  

	1.2	Change of Control 

  
 “Change of Control” shall have the same meaning given in Article 10.2 of the Plan. 
  

	1.3	Option 

  
 “Option” shall mean the option to purchase common stock of the Company granted under this Agreement. 
  

	1.4	Plan 

  
 The “Plan” shall mean the Employee Stock Option and Incentive Plan, as amended and restated. 
  

	1.5	Pronouns 

  
 The masculine pronoun shall include the feminine and neuter, and the singular and plural, where the context so indicates. 
  

	1.6	Secretary 

  
 “Secretary” shall mean the Secretary of the Company. 
  

	*	Refer to attached Notice. 

  

 13 

	1.7	Subsidiary 

  
 “Subsidiary” shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain then owns stock possessing 33 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
  

	1.8	Termination of Employment 

  
 “Termination of Employment” shall mean the time when the employee-employer relationship between the Employee and the Company or a Subsidiary is
terminated for any reason, including, but not limited to, a termination by resignation, discharge, death or retirement, but excluding terminations where there is a simultaneous reemployment or continuing employment by the Company or a Subsidiary,
and, at the discretion of the Committee or the Company, terminations which result in the severance of the employee-employer relationship that do not exceed one year. The Committee or the Company shall determine the effect of all other matters and
questions relating to Termination of Employment. 
  
 ARTICLE II - GRANT OF OPTION 
  

	2.1	Grant of Option 

  
 In consideration of Employee’s agreement to remain in the employ of Company or its subsidiaries and for other good and valuable consideration, on the
date hereof the Company irrevocably grants to Employee the option to purchase any part or all of an aggregate of * shares of its $1.00 par value common stock upon the terms and conditions set forth in this Agreement. Such Option is granted pursuant
to the Plan and shall also be subject to the terms and conditions set forth in the Plan. 
  

	2.2	Purchase Price 

  
 The purchase price of the shares of stock covered by the Option shall be fifty nine and 18500/10000 dollars ($59.185) per share without commission or
other charge. 
  

	2.3	Consideration to Company 

  
 In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient service to the Company or a
Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Employee
any right to continue in the employ of the Company or any Subsidiary or shall interfere with or restrict in any way the rights of the Company and its Subsidiaries, which are hereby expressly reserved, to discharge the Employee at any time for any
reason whatsoever, with or without good cause. Nor shall it interfere with or restrict in any way, other than the forfeiture of all rights under this Agreement, the right of the Employee voluntarily to terminate his employment with the Company or a
Subsidiary. 
  

	2.4	Adjustments in Option 

  
 In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the
Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend, or combination of shares, the Committee or the Company shall make an appropriate and equitable
adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable. Such adjustment shall be made with the intent that after the change or exchange of shares, the Employee’s
proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option may include a necessary corresponding adjustment in the option price per share, but shall be made without change in the total price
applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices). 
  

	*	Refer to attached Notice. 

  

 14 

 ARTICLE III - PERIOD OF EXERCISABILITY 
  

	3.1	Commencement of Exercisability 

  

	 	(a)	The Option shall become exercisable in four cumulative installments as follows: 

  

	 	(i)	The first installment shall consist of twenty-five percent (25%) of the shares covered by the Option and shall become exercisable on the first anniversary of the date the Option was
granted. 

  

	 	(ii)	The second installment shall consist of an additional twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the second anniversary of the
date the Option was granted. 

  

	 	(iii)	The third installment shall consist of an additional twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the third anniversary of the date
the Option was granted. 

  

	 	(iv)	The fourth installment shall consist of twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the fourth anniversary of the date the Option
was granted. 

  
 The installments provided for in
this Subsection (a) are cumulative. Each installment which becomes exercisable shall remain exercisable during the term of the Option, except as otherwise provided in this Agreement. 
  

	 	(b)	No portion of the Option, which is an unexercisable installment under Subsection (a) above at Termination of Employment, shall thereafter become exercisable, unless otherwise
determined by the Committee. 

	 	

	 	(c)	Notwithstanding Subsections 3.1(a) and 3.1(b) above, upon a Change of Control, all Option installments not yet exercisable shall become immediately exercisable.

  

	3.2	Term of Option 

  
 The Option will expire and will not, under any condition, be exercisable after the tenth (10th) anniversary of the date the Option was granted. Such date
shall be the Option’s Expiration Date. 
  

	3.3	Exercise of Option after Termination of Employment 

  
 This Option is exercisable by the Employee only while he is employed by the Company or a Subsidiary, subject to the following exceptions: 
  

	 	(a)	If the Employee dies while the Option is exercisable under the terms of this Agreement, the Employee’s Beneficiary may exercise such rights, subject to the limitation in
Subsection 3.1(b). The Option must be exercised within twelve (12) months after the Employee’s death, and the Committee or the Company may in its discretion extend the Expiration Date of the Option to accommodate such exercise.

  

	 	(b)	If the Employee’s employment is terminated due to his permanent and total disability, as defined in Section 22(c)(3) of the Code, the Employee may exercise the Option, subject
to the limitation in Subsection 3.1(b), within thirty six (36) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(c)	If the Employee’s employment is terminated due to his retirement, the Employee may exercise the Option, subject to the limitations of Subsection 3.1(b), within thirty-six (36)
months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(d)	If the Employee’s employment is terminated other than for good cause or the reasons set forth in Subsections (a) through (c) above, the Employee may exercise the Option,
subject to the limitations of Subsection 3.1(b), within six (6) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

 15 

 ARTICLE IV - EXERCISE OF OPTIONS 
  

	4.1	Partial Exercise 

  
 Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time
when the Option or portion thereof becomes unexercisable under Section 3.2. Each partial exercise shall be for not less than twenty-five (25) shares (or a smaller number, if it is the maximum number which may be exercised under Section 3.1), and
shall be for whole shares only. 
  

	4.2	Manner of Exercise 

  
 The Option, or any exercisable portion thereof, may be exercised by delivery (hard copy, fax or e-mail, as appropriate) to the Secretary or to the
Company’s Securities Administrator of all of the following: 
  

	 	(a)	A written notice, complying with the applicable procedures established by the Committee or the Company, stating that the Option or portion is thereby exercised; the notice shall be
signed by the Employee or the other person then entitled to exercise the Option, or alternatively, if the option exercise is executed through the Company’s designated broker (including execution of stock option exercise electronically through
the Web site of the Company’s designated broker), then such notice shall not be required; and 

  

	 	(b)	Full payment for the shares with respect to which the option or portion thereof is exercised. Payment may be made (i) in cash (or by certified or bank cashier’s check), or (ii)
by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the option is exercised equal to the aggregate
exercise purchase price of the shares with respect to which the option or portion thereof is exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or (iv) irrevocable instructions to a broker, acceptable
to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the option price; or (v) by instructing the Company to withhold a number of such shares having a Fair Market Value on the date of the
exercise equal to the aggregate exercise price of such Option; and 

  

	 	(c)	Full payment to the Company of any federal, state, local or foreign taxes required to be withheld in connection with the exercise. Payment may be made (i) in cash (or by certified
or bank cashier’s check), or (ii) by actual or constructive delivery to the Company, in accordance with the procedures established by the Company, of Company Common Stock then owned by the Employee with a fair market value on the date the
option is exercised equal to the tax liability with respect to which the option or portion thereof is exercised, or (iii) by a combination of cash and surrender of stock in the manner herein specified, or (iv) irrevocable instructions to a broker,
acceptable to the Company, to deliver promptly to the Company the amount of the sale or the loan proceeds necessary to pay the tax liability; or (v) by instructing the Company to withhold a number of such shares having a Fair Market Value on the
date of the exercise equal to the tax liability; (and provided that in any event Employee is responsible for the payment of any and all applicable taxes related to this stock option grant and any exercise of stock options hereunder); and

  

	 	(d)	In the event the Option or portion thereof shall be exercised by any person or persons other than the Employee, appropriate proof of the right of such person or persons to exercise
the Option. 

  

	4.3	Conditions to Issuance of Stock Certificates 

  
 The shares of stock deliverable upon the exercise of the Option, or any part thereof, may be either previously authorized but unissued shares or issued
shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the
Option or part thereof prior to fulfillment of all of the following conditions: 
  

	 	(a)	The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; 

  

 16 

	 	(b)	The completion of any registration or other qualification of such shares under any state or federal law, or under rulings or regulations of the Securities and Exchange Commission or
any other governmental regulatory body which the Committee or the Company shall, in its absolute discretion, deem necessary or advisable; 

  

	 	(c)	The obtaining of any approval or other clearance from any state or federal governmental agency which the Committee or the Company shall, in its absolute discretion, determine to be
necessary or advisable; 

  

	 	(d)	The lapse of such reasonable period of time following the exercise of the Option as the Committee or the Company may from time to time establish for reasons of administrative
convenience; and 

  

	 	(e)	The receipt by the Company of full payment of the exercise price and all taxes related to the exercise of the Option. 

  

	4.4	Rights as Shareholders 

  
 The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon
the exercise of any part of the Option unless and until certificates or book entries representing such shares shall have been issued or made by the Company, or the Company’s transfer agent, to or for such holder. 
  
 ARTICLE V - MISCELLANEOUS 
  

	5.1	Option Subject to Plan 

  
 The Option is subject to the terms of the Plan, and in the event of any conflict between this Agreement and the Plan, the Plan shall control. 

 

	5.2	Administration 

  
 The Committee or the Company shall have the power to interpret the Plan and this Agreement and to adopt such procedures for the administration,
interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such procedures. 
  

	5.3	Option Not Transferable 

  
 Neither the Option nor any interest or right therein or part thereof may be sold, pledged, assigned or transferred in any manner other than by will or by
the applicable laws of descent and distribution. The Option shall be exercised during the Employee’s lifetime only by the Employee, or his guardian or legal representative. 
  

	5.4	Notices 

  
 Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary and any notice to be
given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section, either party may hereafter designate a different address for notices to be given to him. Any notice that
is required to be given to Employee shall, if Employee is then deceased, be given to Employee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section.

  

	5.5	Titles 

  
 Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 
  

 17 

	5.6	Construction 

  
 This Agreement and the Plan and all actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Delaware,
without reference to principles of conflict of laws. 
  
 IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the parties hereto. 
  

									
	 	 	 	 	 	 	AVERY DENNISON CORPORATION
					
	By:	 	 *

	 	 	 	By:	 	 *

	Optionee	 	 	 	 	 	Chairman and Chief Executive Officer
					
	Address*:	 	  

	 	 	 	By:	 	 *

	  

	 	 	 	 	 	Secretary
	  

	 	 	 	 	 	 

	*	Refer to attached Notice. 

  

 18 

 AVERY DENNISON CORPORATION EMPLOYEE STOCK OPTION AND INCENTIVE PLAN (as amended effective

 April 24, 2003) - 2003 UK APPROVED RULES 
  
 AWARD AGREEMENT (“THE AGREEMENT”) 
  
 THIS AGREEMENT, dated December 2, 2004, is made by and between Avery Dennison Corporation, a Delaware corporation, hereinafter referred to as the “Company,” and
* an employee of a Constituent Company, hereinafter referred to as “Employee.” 
  
 WHEREAS, the Company wishes to afford the Employee the opportunity to purchase shares of its $1.00 par value common stock under the terms of the Avery Dennison Corporation Employee Stock Option and Incentive Plan (as
amended and restated effective April 24, 2003) (“the Plan”) 2003 UK Approved Rules (“the Sub-Plan”); and 
  
 WHEREAS, the Compensation and Executive Personnel Committee of the Company’s Board of Directors (hereinafter referred to as the “Committee”), appointed to
administer said Plan, has determined that it would be to the advantage and best interest of Company and its shareholders to grant the Option provided for herein to Employee as an inducement to remain in the service of the Company or a Constituent
Company and as an incentive for increased efforts during such service; 
  
 WHEREAS, the Committee has advised the Company of its determination and instructed the undersigned officers to issue said Option, which the Committee has determined should be a Non-Qualified Stock Option grant, granted under the Sub-Plan.

  
 NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt of which is hereby acknowledged, Company and Employee do hereby agree as follows: 
  
 ARTICLE I - DEFINITIONS 
  
 Whenever the following terms are used in this Agreement they shall have the meaning specified below unless the context clearly indicates to the contrary. 
  

	1.1	Change of Control 

  
 “Change of Control” shall have the same meaning given in Article 10.2 of the Plan, as supplemented and amended by Rule 9 of the Sub-Plan.

  

	1.2	Constituent Company 

  
 “Constituent Company” shall have the meaning given in Rule 1.1 of the Sub-Plan (as defined in Schedule 4 paragraph 3(3) of the Income Tax
(Earnings and Pensions) Act 2003). 
  

	1.3	Option 

  
 “Option” shall mean the option to purchase common stock of the Company granted under the Agreement. 
  

	1.5	Pronouns 

  
 The masculine pronoun shall include the feminine and neuter, and the singular and plural, where the context so indicates. 
  

	1.6	Secretary 

  
 “Secretary” shall mean the Secretary of the Company. 
  

	*	Refer to attached Notice. 

  

 19 

	1.7	Termination of Employment 

  
 “Termination of Employment” shall mean the time when the employee-employer relationship between the Employee and the Company or a Constituent
Company is terminated for any reason, including, but not limited to, a termination by resignation, discharge, death or retirement, but excluding terminations where there is a simultaneous reemployment or continuing employment by the Company a
Constituent Company or another company in the same group as the Company, and, at the discretion of the Committee or the Company, terminations which result in the severance of the employee-employer relationship that do not exceed one year. The
Committee or the Company shall determine the effect of all other matters and questions relating to Termination of Employment. 
  
 ARTICLE II - GRANT OF OPTION 
  

	2.1	Grant of Option 

  
 In consideration of Employee’s agreement to remain in the employ of Company or its subsidiaries and for other good and valuable consideration, on the
date hereof the Company irrevocably grants to Employee the option to purchase any part or all of an aggregate of * shares of its $1.00 par value common stock upon the terms and conditions set forth in this Agreement. Such Option is granted pursuant
to the Sub-Plan and shall also be subject to the terms and conditions set forth in the Plan and the Sub-Plan. 
  

	2.2	Option Price 

  
 The option price of the shares of stock shall be fifty nine and 18500/10000 dollars (US$59.185) per share without commission or other charge, which was
the equivalent of £30.751. (For informational purposes, on December 2, 2004 the exchange rate of £ to US$, as reported by Bloomberg L.P., was £1.00 equals US$1.9246). 
  

	2.3	Consideration to Company 

  
 In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient service to the Company a Constituent
Company or another group company, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least twelve months from the date this Option is granted. Nothing in this Agreement or in the Plan or
Sub-Plan shall confer upon the Employee any right to continue in the employment of the Company, a Constituent Company or another group company or shall interfere with or restrict in any way the rights of the Company, Constituent Company or another
group company, which are hereby expressly reserved, to discharge the Employee at any time for any reason whatsoever, with or without good cause. Nor shall it interfere with or restrict in any way, other than the forfeiture of all rights under this
Agreement, the right of the Employee voluntarily to terminate his employment with the Company, Constituent Company or another group company. 
  

	2.4	Adjustments in Option 

  
 The Committee or the Company shall make an appropriate and equitable adjustment to the Option only in circumstances specified in Rule 6 of the Sub-Plan.
Such adjustment shall be made with the intent that after the change or exchange of shares, the Employee’s proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option may include a necessary
corresponding adjustment in the option price per share, but shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share
quantities or prices). 
  
 ARTICLE III -
PERIOD OF EXERCISABILITY 
  

	3.1	Commencement of Exercisability 

  

	 	(a)	The Option shall become exercisable as follows: 

  

	 	(i)	The first installment shall consist of twenty-five percent (25%) of the shares covered by the Option and shall become exercisable on the first anniversary of the date the Option was
granted. 

  

	*	Refer to attached Notice. 

  

 20 

	 	(ii)	The second installment shall consist of an additional twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the second anniversary of the
date the Option was granted. 

  

	 	(iii)	The third installment shall consist of an additional twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the third anniversary of the date
the Option was granted. 

  

	 	(iv)	The fourth installment shall consist of twenty five percent (25%) of the shares covered by the Option and shall become exercisable on the fourth anniversary of the date the Option
was granted. 

  
 The installments provided for in
this Subsection (a) are cumulative. Each installment which becomes exercisable shall remain exercisable during the term of the Option, except as otherwise provided in this Agreement. 
  

	 	(b)	No portion of the Option, which is an unexercisable installment under Subsection (a) above at Termination of Employment, shall thereafter become exercisable, unless otherwise
determined by the Committee. 

  

	 	(c)	Notwithstanding Subsections 3.1(a) and 3.1(b) above, upon a Change of Control, all Option installments not yet exercisable shall become immediately exercisable.

  

	3.2	Term of Option 

  
 The Option will expire and will not, under any condition, be exercisable after the tenth anniversary of the date the Option was granted. Such date shall
be the Option’s Expiration Date. 
  

	3.3	Exercise of Option after Termination of Employment 

  
 This Option is exercisable by the Employee only while he is employed by the Company, Constituent Company or another group company, subject to the
following exceptions: 
  

	 	(a)	Termination by Death – if the Employee dies while the Option is exercisable under the terms of this Agreement the Option may be exercised by the Employee’s
personal representatives, to the extent then exercisable, for a period of 12 months from the date of death or until the expiration of the stated term of the Option, whichever period is the shorter. 

  

	 	(b)	Termination by Reason of Disability - If the Employee’s employment is terminated due to his permanent and total disability, as defined in Section 22(c)(3) of the
Code, the Employee may exercise the Option, subject to the limitation in Subsection 3.1(b), within thirty six (36) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(c)	Termination by Reason of Retirement - If the Employee’s employment is terminated due to his retirement the Employee may exercise the Option, subject to the
limitations of Subsection 3.1(b), within thirty-six (36) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

	 	(d)	Other Termination - If the Employee’s employment is terminated other than for good cause or the reasons set forth in Subsections (a) through (c) above, the
Employee may exercise the Option, subject to the limitations of Subsection 3.1(b), within six (6) months after Termination of Employment, but not later than the Option’s Expiration Date. 

  

 21 

 ARTICLE IV - EXERCISE OF OPTIONS 
  

	4.1	Partial Exercise 

  
 Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time
when the Option or portion thereof becomes unexercisable under Section 3.2. Each partial exercise shall be for not less than twenty-five shares (or a smaller number, if it is the maximum number which may be exercised under Section 3.1), and shall be
for whole shares only. 
  

	4.2	Manner of Exercise 

  

	 	(a)	A written notice, complying with the applicable procedures established by the Committee or the Company, stating that the Option or portion is thereby exercised; the notice shall be
signed by the Employee or the other person then entitled to exercise the Option, or alternatively, if the option exercise is executed through the Company’s designated broker (including execution of stock option exercise electronically through
the Web site of the Company’s designated broker), then such notice shall not be required; and 

  

	 	(b)	Full payment to the Company of the aggregate exercise price for the shares with respect to which the Option or portion thereof is exercised must be made in cash (or by certified or
bank cashier’s check). 

  

	 	(c)	An exercise shall not be valid unless, in addition to receipt of a valid notice of exercise (hard copy, fax or email, as appropriate) and payment of the option price, the Company is
satisfied that the Employee has entered into arrangements which are satisfactory to the Company, to pay all or any part of the British Federal, State, local and foreign taxes for which the Employee is liable and which are required by law to be
withheld by the Constituent Company or any other member of the same group of companies as the Constituent Company on the exercise of the Option in accordance with Rule 7.4 of the Sub-Plan. 

  
 In the event the Option or portion thereof shall be exercised by any person
or persons other than the Employee, appropriate proof of the right of such person or persons to exercise the Option must be provided. 
  

	4.3	Conditions to Issuance of Stock Certificates 

  
 The shares of stock deliverable upon the exercise of the Option, or any part thereof, may be either previously authorized but unissued shares or issued
shares which have then been reacquired by the Company. Such shares shall be fully paid and non assessable and will be allotted to the Employee within 30 days from the effective date of exercise in accordance with Rule 7.2 of the Sub-Plan. The
Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or part thereof prior to fulfillment of all of the following conditions: 
  

	 	(a)	The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; 

  

	 	(b)	The completion of any registration or other qualification of such shares under any state or federal law, or under rulings or regulations of the Securities and Exchange Commission or
any other governmental regulatory body which the Committee or the Company shall, in its absolute discretion, deem necessary or advisable; 

  

	 	(c)	The obtaining of any approval or other clearance from any state or federal governmental agency which the Committee or the Company shall, in its absolute discretion, determine to be
necessary or advisable; 

  

	 	(d)	The lapse of such reasonable period of time following the exercise of the Option as the Committee or the Company may from time to time establish for reasons of administrative
convenience; and 

  

	 	(e)	The receipt by the Company of full payment for such shares. 

  

	4.4	Rights as Shareholders 

  
 The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon
the exercise of any part of the Option unless and until certificates or book entries representing such shares shall have been issued or made by the Company, or the Company’s transfer agent, to or for such holder. 
  

 22 

 ARTICLE V - MISCELLANEOUS 
  

	5.1	Option Subject to Plan 

  
 The Option is subject to the terms of the Plan as amended by the Sub-Plan, and in the event of any conflict between this Agreement, the Plan and the
Sub-Plan, the Sub-Plan shall prevail. 
  

	5.2	Administration 

  
 The Committee or the Company shall have the power to interpret the Plan, the Sub-Plan and this Agreement and to adopt such procedures for the
administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such procedures. 
  

	5.3	Option Not Transferable 

  
 Neither the Option nor any interest or right therein or part thereof may be sold, pledged, assigned or transferred. The Option shall be exercised during
the Employee’s lifetime only by the Employee, or his guardian or legal representative. 
  

	5.4	Notices 

  
 Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary and any notice to be
given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section, either party may hereafter designate a different address for notices to be given to him. Any notice that
is required to be given to Employee shall, if Employee is then deceased, be given to Employee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section.

  

	5.5	Titles 

  
 Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 
  

	5.6	Construction 

  
 This Agreement and the Plan and Sub-Plan and all actions taken thereunder shall be governed by and construed in accordance with the laws of the State of
Delaware, without reference to principles of conflict of laws. 
  
 IN WITNESS
WHEREOF, this Agreement has been executed and delivered by the parties hereto. 
  

									
	 	 	 	 	 	 	AVERY DENNISON CORPORATION
					
	By:	 	 *

	 	 	 	By:	 	 *

	Optionee	 	 	 	 	 	Chairman and Chief Executive Officer
					
	Address*:	 	  

	 	 	 	By:	 	 *

	  

	 	 	 	 	 	Secretary
	  

	 	 	 	 	 	 

	*	Refer to attached Notice. 

  

 23

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]